Turner v Grovit and Others

Under English law, an order restraining foreign proceedings operates in personam. It neither binds the foreign court nor determines that court’s jurisdiction. Outside contractual forum arrangements, the applicant must be party to existing English proceedings; the respondent must be acting in bad faith to frustrate or obstruct them; and restraint must be necessary to protect the applicant’s legitimate interest.

Where interpretation of the 1968 Brussels Convention is raised before the House of Lords and a ruling is necessary for judgment, the 1971 Protocol requires a reference to the European Court of Justice. Whether the Convention permitted restraint on the abuse ground was not acte clair. The House referred that question and did not finally determine compatibility.

Turner v Grovit and Others arose from employment proceedings brought in England by a solicitor against a company in the Chequepoint group. A Spanish group company subsequently claimed substantial damages against him in Madrid, alleging deficient performance and wrongful termination of the same working relationship.

A deputy High Court judge declined to continue an injunction restraining the Spanish action. The Court of Appeal allowed the claimant’s appeal, [2000] 1 QB 345, finding that the Spanish proceedings were a sham commenced in bad faith to obstruct the English employment proceedings. It ordered their discontinuance and restrained related foreign proceedings.

The defendants appealed. The central issue was whether the 1968 Brussels Convention precluded an English court from restraining parties within its jurisdiction from commencing or continuing proceedings in another Convention state for that abusive purpose.

1. Reference to the European Court of Justice. Lord Hobhouse delivered the leading speech. Lord Nicholls, Lord Hoffmann, Lord Millett and Lord Scott agreed. The House unanimously held that Article 3(1) of the 1971 Protocol, as incorporated by section 2(1) of the Civil Jurisdiction and Judgments Act 1982, required a reference where interpretation of the 1968 Brussels Convention was raised and a ruling was necessary for judgment. The answer was not acte clair.

2. Nature of the domestic power. Lord Hobhouse held that section 37(1) of the Supreme Court Act 1981 conferred the relevant power, subject to judicial constraints. A so-called anti-suit injunction is directed only to a party amenable to the English court’s jurisdiction. It does not bind the foreign court, deny its jurisdiction or require it to desist. The remedy addresses wrongful conduct by the restrained party.

3. Conditions for restraint. Lord Hobhouse identified three essential features in a non-contractual abuse case: the applicant must be party to existing English proceedings; the respondent must have commenced or proposed foreign proceedings in bad faith to frustrate or obstruct those proceedings; and restraint must be necessary to protect the applicant’s legitimate interest in the English proceedings. Those requirements were satisfied on the Court of Appeal’s findings. The foreign action had been brought solely to oppress the claimant and impede his employment claim.

4. Foreign jurisdiction and Article 21. Lord Hobhouse held that the English order did not depend on the Madrid court lacking jurisdiction. Whether Article 21 required that court to defer was for the Madrid court. That issue was not decisive because the restraining orders rested on abuse of the English proceedings, not on any alleged infringement of Article 21 or on forum non conveniens.

5. Provisional view. Lord Hobhouse stated that, if the Convention issue had been for the House alone, he would have dismissed the appeal. An order addressing bad-faith obstruction of existing English proceedings did not adjudicate upon the foreign court’s jurisdiction and could reduce the risk of irreconcilable judgments. By contrast, restraint based merely on treating another Convention state as an inconvenient forum would be inconsistent with the Convention scheme. This remained provisional because the Convention question was referred. The correctness of Continental Bank v Aeakos SA [1994] 1 WLR 588 on the priority of Article 17 over Articles 21 and 22 was left open.

• House of Lords — In Turner v Grovit and Others [2001] UKHL 65, the House unanimously referred the Convention question to the European Court of Justice and did not finally determine the appeal.
• Court of Appeal — Allowed the claimant’s appeal, [2000] 1 QB 345. It found that the Spanish proceedings were abusive and ordered their discontinuance while restraining further related foreign proceedings.
• High Court — Pumphrey J initially granted a temporary injunction. David Donaldson QC, sitting as a deputy judge of the Chancery Division, subsequently declined to renew it.