Pacific International Sports Clubs Ltd v Surkis & Ors

On a forum non conveniens stay, the court must first identify the natural and appropriate foreign forum. The claimant must then show, by positive and cogent evidence, special circumstances creating a sufficient risk that justice will not be obtained there. This is an evaluative assessment of future risk, not a requirement to prove on the balance of probabilities that an unfair trial will occur. The two-stage analysis is not rigid: the judge may assess all the circumstances in the round. An English connection created by a minor defendant whose claim cannot be stayed does not necessarily determine the forum for the dispute as a whole. Later amendments introducing materially new causes of action cannot support an earlier order for service out.

Pacific International Sports Clubs Ltd brought Ukrainian-law tortious conspiracy and unjust enrichment claims concerning the dilution and extinguishment of its stake in Dynamo Kiev Football Club. The claims were brought against Igor Surkis, BVI companies and Soccer Marketing International Ltd, an English-registered company.

Blackburne J held that Ukraine was the natural forum, but that the evidence did not establish that Pacific would be denied justice there. He stayed the claims against Mr Surkis and set aside permission to serve the BVI companies out of the jurisdiction. The appeal concerned the assessment of the risk of injustice, the relevance of the English proceedings against SMI, and the effect of amendments introducing Ukrainian causes of action.

1. Appeal dismissed. The stay of the claims against Mr Surkis and the setting aside of permission and service on the BVI defendants were upheld.
2. The judge had not misdirected himself by referring to whether justice would be unavailable or by requiring cogent evidence. In this context, cogency concerns the quality of evidence bearing on the degree of risk that an unfair trial will occur. It does not require proof, on the balance of probabilities, of a future event.
3. The two-stage approach in Spiliada Maritime Corporation v Cansulex Ltd is not rigid or self-contained. Having decided that Ukraine was the natural forum and that the evidence of special circumstances was insufficiently cogent, the judge was entitled to stand back and consider the circumstances in the round.
4. General evidence of deficiencies in the Ukrainian judicial system and Pacific’s adverse experiences in other proceedings did not provide sufficiently direct and cogent evidence that Pacific would be denied a fair trial in this dispute. The judge was entitled to note that adverse decisions do not themselves prove incompetence, impropriety, bias or corruption, and that there was no cogent evidence of improper influence by Mr Surkis or his associates.
5. The English proceedings against SMI could not be stayed under Owusu v Jackson. Their existence did not require the related claims against the foreign defendants to proceed in England. Duplication and inconsistent decisions were relevant, but could be mitigated by case management.
6. The amendments introduced different causes of action under Ukrainian law, rather than merely clarifying the existing case. A claimant who obtained permission to serve out is confined to the case specifically pleaded for that application and cannot later justify service on another legal basis.

• Court of Appeal (Civil Division) — [2010] EWCA Civ 753: appeal dismissed.
• High Court, Chancery Division — Blackburne J, [2009] EWHC 1839 (Ch): Ukraine was the natural forum; the claims against Mr Surkis were stayed and permission to serve the BVI defendants was set aside.