Underwriting Members of Lloyd's Syndicate 980 & Ors v Sinco SA

Article 27 of Council Regulation (EC) 44/2001 requires comparison of the cause and object of the relevant proceedings, between the same parties. The assessment is broad, but a common jurisdictional issue is insufficient where the substantive claims and legal bases differ. A contractual claim for damages for breach of an exclusive jurisdiction clause is not necessarily the same cause of action as substantive claims brought in another Member State, even if both proceedings raise the validity or effect of that clause.

Article 30 requires an autonomous, predictable determination of when proceedings are pending. An amendment adding a claim based on facts occurring after the original proceedings were issued does not automatically relate back for Regulation purposes.

The Syndicates brought English proceedings against Sinco concerning alleged fraud, misrepresentation and failure to account under binding authority agreements. The agreements contained exclusive English jurisdiction clauses. Before service of the English proceedings, Sinco commenced Greek proceedings advancing claims based on tort, statute and the Greek Commercial Code.

The Syndicates later amended their English claim to add damages for Sinco’s alleged breach of the jurisdiction clauses by commencing the Greek proceedings. Sinco sought a stay of that claim under Article 27 of Council Regulation (EC) 44/2001 pending the Greek court’s decision on jurisdiction. The issues were whether the English court was first seised under Article 30 and, if not, whether the English and Greek proceedings involved the same cause of action and object.

1. Application dismissed. The jurisdiction clause claim was not stayed under Article 27 of Council Regulation (EC) 44/2001.
2. Article 27 is interpreted broadly in accordance with the policy of preventing irreconcilable judgments. The cause of action comprises the facts and rule of law relied on, while the object is the end sought by the action. The claims, rather than the defences, are compared.
3. Looking at the proceedings as a whole, the Greek proceedings concerned claims arising outside contract and founded on tort or statute, whereas the English proceedings were contractual. The jurisdiction clause claim was therefore distinguishable from cases involving mirror-image substantive claims. The fact that jurisdiction might arise as a common issue was insufficient.
4. The court followed the approach in Continental Bank v Aeakos, Toepfer International GmbH v Molino Boschi SRL and Toepfer International GmbH v Cargill France. A jurisdictional objection in the foreign proceedings was only one aspect of those proceedings and did not make the cause and object identical.
5. Article 30 requires a uniform and autonomous assessment of when proceedings are pending. Domestic relation-back rules do not determine that question. The jurisdiction clause claim depended on the later institution of the Greek proceedings and had not existed when the English claim was issued. The English court was consequently not treated as first seised of that claim merely because the amendment took effect retrospectively under domestic procedure.
6. The court considered that fragmentation may sometimes be a consequence of the Regulation. Where avoiding fragmentation would create a possibility of conflicting decisions, fragmentation may be more consistent with the Regulation’s purpose.