Novus Aviation Ltd v Onur Air Tasimacilik AS

Where permission to serve proceedings out of the jurisdiction is sought on the basis that a contract is governed by English law, the claimant must still show that England is clearly the appropriate, or natural, forum for the dispute. The governing law is relevant, but its weight depends on the issues likely to arise. It does not amount to a choice of English forum. The use of English in international negotiations or documents ordinarily carries limited weight. The court must assess the dispute as a whole, including the parties’ residence, witnesses, factual connections, governing law, and the jurisdictional ground relied upon. An appellate court should not interfere with a commercial judge’s evaluative discretion absent an error of principle or a plainly wrong decision.

Novus, a Bahamian aviation business, claimed commissions from Onur, a Turkish airline, under an alleged extension of an agency agreement concerning aircraft wet-leasing arrangements with Saudi Arabian Airlines. The parties’ agreements included an English governing-law clause, but no English jurisdiction clause.

Onur had no office in England, and the relevant negotiations, meetings, payments, witnesses, and transactions were connected with Turkey, Switzerland, Saudi Arabia, or other locations. Tomlinson J granted permission to serve the proceedings in Turkey. Aikens J refused Onur’s application to set aside that order on 19 May 2008. On appeal, the central issue was whether England was the proper forum under Civil Procedure Rules 1998 6.20(5)(c) and 6.21(2A), now reflected in 6BPD paragraph 3.1(6)(c) and rule 6.37(3).

1. Appeal dismissed. The court upheld Aikens J’s exercise of discretion to permit service out of the jurisdiction.
2. Under Civil Procedure Rules 1998 6.20(5)(c), read with rule 6.21(2A), the claimant had to show that England and Wales was the proper place to bring the claim. The applicable inquiry was whether England was clearly the appropriate forum, or the natural forum with which the dispute had the most real and substantial connection. The claimant bore a heavy burden, and the jurisdiction was an exorbitant one requiring particular caution.
3. The Court of Appeal rejected the contention that the judge had overlooked Spiliada Maritime Corp v Cansulex Ltd. His formulation of the appropriate-forum inquiry substantially reflected that authority. A commercial judge’s unreserved ex tempore judgment should not be subjected to narrow textual analysis or expected to reproduce every nuance of the leading speech where the relevant principles were familiar.
4. An English governing-law clause and the use of English were relevant but non-conclusive factors. The weight of English law depended on the legal and practical issues likely to arise. The choice of English law did not imply a choice of English jurisdiction. In international commerce, the use of English in negotiations and documents was ordinarily of limited significance. The present dispute appeared principally to concern whether an agreement had been made at a meeting, rather than any substantial or difficult issue of English law.
5. The judge was entitled to weigh the possible English-law issues, the language of the documents and negotiations, the location of Onur and its witnesses in Turkey, and the absence of any factual connection with England. Those matters could support England as the appropriate forum even though the dispute had no factual connection with Turkey either. The balancing exercise was finely poised, but disclosed no error of principle or other basis for appellate intervention.
6. The court therefore dismissed the appeal. Wilson LJ and the President of the Family Division agreed with Lawrence Collins LJ.

• Court of Appeal (Civil Division) [2009] EWCA Civ 122: appeal dismissed; the court upheld the refusal to set aside permission to serve proceedings out of the jurisdiction.
• High Court of Justice, Queen’s Bench Division, Commercial Court: Tomlinson J granted permission without notice to serve in Turkey. Aikens J’s judgment of 19 May 2008 refused Onur’s application to set aside that order.