Masri v Consolidated Contractors International Company Sal & Anor

Where the English court has jurisdiction over substantive proceedings, it may grant an ancillary anti-suit injunction to protect its process and judgments. In an alternative forum case, the application requires neither a separate cause of action nor an independent jurisdictional basis. Submission to the substantive proceedings extends to such incidental orders, including after judgment. That power also applies to a judgment debtor domiciled in a Brussels I Regulation State and does not depend on the order being provisional or protective. Its exercise requires caution and respect for international comity. Vexatious or oppressive proceedings seeking to re-litigate matters already determined by an English judgment can justify an injunction. Different considerations arise where an injunction would interfere with an existing foreign judgment.

Munib Masri obtained judgments for approximately US$55 million against Consolidated Contractors International Company SAL and Consolidated Contractors (Oil & Gas) Company SAL. His entitlement arose from an interest in the companies’ interest in a Yemeni oil concession. Both companies were incorporated in Lebanon. The first also had a domicile in Greece for the purposes of the Brussels I Regulation. Both had submitted to the English court’s jurisdiction and defended the substantive proceedings.

After judgment, the companies commenced proceedings in Yemen seeking a declaration that they were not liable to Mr Masri. HH Judge Mackie QC granted an injunction restraining proceedings concerning the agreement and the parties’ rights under it outside England and EU courts. He also required discontinuance of the Yemeni proceedings. Those proceedings were discontinued, but the appeal remained material because further proceedings might be brought.

The companies challenged personal jurisdiction, the effect of their submission, the compatibility of the injunction with international comity and its geographical scope. A related appeal concerning other ancillary orders had been determined in Masri v Consolidated Contractors International Co SAL [2008] EWCA Civ 303. The central question was whether the English court could restrain foreign judgment debtors from re-litigating matters already determined in proceedings to which they had submitted.

The appeal was dismissed, and the order was varied to exclude Lugano Convention States. Lawrence Collins LJ delivered the judgment, with which Longmore LJ and Sir Anthony Clarke MR agreed.

1. An anti-suit injunction operates against the restrained party personally. The party must be amenable to the English court’s jurisdiction so that the injunction can be enforced. Where the court already has jurisdiction over substantive proceedings, it can make ancillary orders protecting its jurisdiction, process and judgments, both before and after judgment.
2. In an alternative forum case, an application for such an injunction does not require a separate cause of action establishing a legal or equitable right not to be sued abroad. The application is ancillary to the existing proceedings. The authorities concerning injunctions founded on contractual rights or brought in single forum cases did not establish a universal requirement for a separate claim. The older view that forum conveniens alone justified an injunction had been replaced by the requirement of vexatious or oppressive foreign proceedings.
3. The companies’ submission to the substantive proceedings supplied personal jurisdiction for incidental orders. The injunction required neither amendment of the claim form nor a fresh jurisdictional basis under the Brussels I Regulation or CPR 6.20. The rule requiring independent jurisdiction for additional substantive claims remained applicable, but this application introduced no such claim. The eventual dismissal of the claim against the English co-defendant affected neither the original assertion of jurisdiction nor the scope of the companies’ submission.
4. Jurisdiction over a domiciliary of a Brussels I Regulation State to make an ancillary order did not depend on its being provisional or protective. The European decisions concerning provisional measures did not decide the limits of other ancillary powers. In any event, this interim injunction protected the underlying rights, the judgment and the integrity of the English proceedings. It was a protective measure and carried an implied liberty to apply.
5. International comity required caution because an injunction indirectly interfered with foreign proceedings. Nevertheless, re-litigation abroad of matters already determined by an English judgment could justify relief. The refusal of injunctions in ED & F Man (Sugar) Ltd v Haryanto (No. 2) and Mamidoil-Jetoil Greek Petroleum Co SA v Okta Crude Refinery AD involved existing foreign judgments or orders and discretionary considerations. The Western Regent concerned the unusual international effect of a maritime limitation decree. Those decisions established no general prohibition on restraining re-litigation.
6. The Yemeni proceedings were a classic instance of vexation and oppression designed to interfere with the English court’s process. The evidence of resistance to payment, coupled with the companies’ refusal to disclose their intentions concerning proceedings elsewhere, justified an injunction extending beyond Yemen. The implied liberty to apply remained available. Apart from excluding Lugano Convention States, there was no reason to interfere with the judge’s discretion.

• Court of Appeal: In [2008] EWCA Civ 625 , the court dismissed the appeal against the anti-suit injunction and varied its geographical scope to exclude Lugano Convention States.
• Court of Appeal, related proceedings: Masri v Consolidated Contractors International Co SAL [2008] EWCA Civ 303 determined a related appeal concerning ancillary enforcement orders. Earlier jurisdictional objections had been dismissed in Consolidated Contractors International Co SAL v Masri [2005] EWCA Civ 1436 , [2006] 1 WLR 830 . An appeal concerning jurisdiction remained pending before the House of Lords, although the companies had submitted to jurisdiction and contested the merits.
• High Court, Commercial Court: On 25 May 2007, HH Judge Mackie QC granted the anti-suit injunction and required discontinuance of the Yemeni proceedings. Gloster J had previously determined liability in July 2006 and quantum in March 2007.