Jordan Grand Prix Ltd v Baltic Insurance Group (Baltic Insurance Group v Jordan Grand Prix Ltd)

In matters relating to insurance, Article 11 of the Brussels Convention applies to an insurer irrespective of the insurer’s own domicile. Proceedings by the insurer are restricted to the courts of the Contracting State in which the defendant is domiciled. The counterclaim proviso preserves only an ordinary counterclaim against the original plaintiff. It does not authorise an insurer to join new defendants who were not parties to the original claim. Such defendants have not submitted to the jurisdiction merely because the original action is pending. The leading judgment treated the references to the policy-holder, insured and beneficiary as descriptive rather than exhaustive, but that could not enlarge the counterclaim proviso. The appeal was dismissed and a reference to the European Court of Justice was refused.

Jordan Grand Prix Ltd brought proceedings concerning insurance cover for contractual payments connected with its Formula 1 racing team. Baltic Insurance Group, a Lithuanian insurer, defended the claim and counterclaimed for declarations and damages alleging conspiracy and fraud against Jordan and others, including Quay Financial Software Ltd, Dermot Desmond and Gerard Giblin.

Before the counterclaim was served on those parties, Quay began proceedings in Belgium against Baltic, SRI and CIU. Langley J declared that the court had no jurisdiction over Baltic’s counterclaim against Quay, Mr Desmond and Mr Giblin. Baltic appealed.

The appeal concerned Article 11 of the Brussels Convention, set out in Schedule 1 to the Civil Jurisdiction and Judgments Act 1982. The issues were whether Article 11 applied to an insurer domiciled outside a Contracting State, whether its counterclaim proviso permitted claims against non-plaintiff parties, and whether the status of the proposed defendants affected the result. Questions under Articles 21 and 22 were reserved.

Appeal dismissed. Lord Justice Robert Walker delivered the leading judgment. Lord Justice Otton agreed with the result and the principal reasoning. Lord Justice Staughton agreed that the appeal should be dismissed on the counterclaim point, but expressed doubts about the wider issues and did not decide whether Mr Desmond and Mr Giblin fell within the specified categories in Article 11.

1. Article 11 applied irrespective of Baltic’s domicile. Its wording contained no requirement that the insurer itself be domiciled in a Contracting State. This contrasted with the express references to domicile elsewhere in the Convention. The approach was consistent with New Hampshire Insurance v Strabag Bau [1992] 1 LR 361 and with the protective purpose of the insurance provisions.
2. The counterclaim proviso applied only to an ordinary counterclaim against the original plaintiff. A plaintiff who submits to a court’s jurisdiction becomes subject to the incidents of that litigation, including a counterclaim, as recognised in Republic of Liberia v Gulf Oceanic Inc [1985] 1 Ll Rep 539 and Metal Scrap Trade Corporation Ltd v Kate Shipping Company Ltd [1990] 1 WLR 115. It did not permit Baltic to attach claims against new parties to the English proceedings.
3. The court rejected the submission that alleged co-conspirators had submitted to the jurisdiction through the alleged principal conspirator. That proposition assumed the very conspiracy which Baltic had to establish. The authorities relied on by analogy, including Derby & Company Ltd v Larsson [1976] 1 WLR 202, did not assist. The approach was consistent with the party-by-party analysis in The Maciej Rataj [1995] 1 Ll R, 302, and with the reasoning considered in Danvaern Productions v Schuhfabriken Otterbeck [1995] ECR Vol 1 2053.
4. Walker LJ considered the list of policy-holder, insured and beneficiary illustrative rather than exhaustive. The point did not alter the result because Baltic could invoke the proviso only by counterclaim against an original plaintiff.
5. Walker LJ considered the conclusions sufficiently clear to justify refusing a reference under Article 177 of the Treaty of Rome. Staughton LJ declined a reference as a matter of discretion despite his doubts. The appeal was dismissed with costs and leave to appeal was refused.

1. Court of Appeal (Civil Division) Appeal dismissed with costs. Leave to appeal refused.
2. Queen’s Bench Division Langley J declared that the court had no jurisdiction over Baltic’s counterclaim against Quay Financial Software Ltd, Dermot Desmond and Gerard Giblin.