Nussberger & Anor v Phillips & Anor

For the purposes of Article 21 of the Lugano Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters 1988, an English court becomes seised of proceedings against a foreign defendant when the claim form is served. Filing documents with the Senior Master for service abroad is not service on the defendant. A domestic power under CPR 6.9 to dispense retrospectively with service cannot rewrite the chronological priority already obtained by proceedings in another Convention state. CPR 3.10 does not convert service of a translation or particulars of claim into service of the claim form. Convention-based rules require clarity, predictability, mutual respect and consistency. The English proceedings were therefore stayed where the Swiss proceedings had been issued first.

Administrators of the estate of Christo Michailidis brought proceedings against Frieda Nussberger and Galerie Nefer AG concerning the proceeds due for the sale of a statue. The defendants later commenced proceedings in Switzerland seeking declaratory relief concerning their liability and ownership issues.

The English claim form was sent for service in Switzerland, but the copy claim form was removed before service because it bore an erroneous stamp stating that it was not for service out of the jurisdiction. The defendant received the translation of the claim form and the particulars of claim, but not the copy claim form. Peter Smith J subsequently dispensed with service under CPR 6.9 and held that the English proceedings had priority under Article 21 of the Lugano Convention. The appeal concerned whether the English court was first seised and whether CPR 6.9 and CPR 3.10 could cure the omission retrospectively.

1. The appeal was allowed. Neuberger LJ gave the principal judgment. Pill LJ and Wilson LJ agreed. The English proceedings were stayed as against the defendants under Article 21 of the Lugano Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters 1988.
2. Article 21 required a simple chronological determination of which court was first seised. Following Dresser UK Ltd v Falcongate Freight Management Ltd [1992] 1 QB 502 and Neste Chemicals SA v DK Line SA (The Sargasso) [1994] 3 All ER 180, the English court became seised of proceedings against a foreign defendant only when the claim form was served. Filing documents with the Senior Master for transmission under the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters 1965 was not service on the defendant.
3. In a domestic case, CPR 6.9 could be used retrospectively to dispense with service after expiry of the ordinary period, but only in exceptional circumstances. The present facts would have been sufficiently unusual for such relief in a purely domestic setting, particularly because the defendant had received the claim-form translation and suffered no prejudice.
4. That domestic power could not be used to give the English proceedings retrospective priority over Swiss proceedings which had already been issued and had thereby obtained priority under Article 21. Such an approach would undermine chronological certainty, mutual trust between Convention courts and the simplicity and predictability required by the international scheme. Even if CPR 6.9 could technically achieve that result, it would be inappropriate to grant relief. The defendants had not evaded service, and the claimants bore at least some responsibility for the failure.
5. CPR 3.10 did not fictionalise service of the claim form by treating service of the translation or particulars of claim as service of the claim form. Although premature service of the particulars might be validated if CPR 6.9 relief were granted, seisin could not thereby arise before the application for relief, and probably not before the order or the defendant’s knowledge of it.
6. The Hague Convention issue was academic. It primarily regulated the method of service, leaving the domestic court to determine what documents were required under its procedural rules, but domestic rules could not be used to subvert the Convention or the Lugano priority rule.

• Court of Appeal (Civil Division) In [2006] EWCA Civ 654 , the appeal was allowed and the proceedings were stayed against the defendants under Article 21 of the Lugano Convention.
• High Court (Chancery Division) Peter Smith J, on 19 August 2005, dispensed with service of the copy claim form under CPR 6.9 and treated the English proceedings as having priority over the Swiss proceedings.