The Royal Bank Of Scotland Plc v Hicks & Ors

The grant of negative declaratory relief is discretionary. There are no special jurisdictional thresholds. The principal consideration is whether the declaration would serve a useful purpose, although the court must remain alert to procedural unfairness caused by reversing the usual roles of claimant and defendant.

An anti-suit injunction may restrain foreign proceedings where an exclusive jurisdiction clause gives a party a contractual right to litigate in England, or where foreign proceedings would be vexatious or oppressive. The jurisdiction remains discretionary and is subject to comity. The court may continue an existing injunction to protect amended domestic proceedings where there remains a real threat of foreign proceedings within either category.

The applications arose in continuing litigation concerning the sale of Liverpool Football Club by companies formerly controlled by Thomas Hicks and George Gillett. The court had previously granted an anti-suit injunction after the former owners obtained a temporary restraining order from a Texas court aimed at preventing the sale.

At this case management stage, the court considered amendments to claims by RBS and Sir Martin Broughton, an application to strike out or stay the Broughton action, discharge or variation of the anti-suit injunction, joinder of NESV, and service out of the jurisdiction. The central issues were whether the amended negative declarations should be permitted and whether the existing injunction remained necessary.

1. Negative declarations. The power to grant negative declaratory relief is discretionary and is not subject to special jurisdictional thresholds. The court should ask whether the declaration would serve a useful purpose, while treating the reversal of the usual procedural roles as a factor requiring caution. The former owners had already advanced detailed allegations in Texas and in public statements, so they could not fairly be treated as merely reluctant litigants. The amendments in both actions were therefore allowed.
2. The principle in Henderson v Henderson did not justify refusing amendment. It may require a party to bring forward claims known, or discoverable with reasonable diligence, but it does not render abusive a claim of which the party was unaware, as explained in Stuart v Goldberg Linde (a firm).
3. Anti-suit injunction. The court’s power under section 37(1) of the Senior Courts Act 1981 covered both proceedings contrary to a legal or equitable right to litigate in England and proceedings which were vexatious or oppressive. The jurisdiction remained discretionary and had to be exercised with regard to comity. The contractual right under Sir Martin Broughton’s exclusive jurisdiction clause was a strong factor. The threatened claims also risked fragmentation and inconsistent decisions, particularly because the alleged breaches of fiduciary duty lay at the centre of the proposed foreign proceedings.
4. The former owners had not shown good reason to discharge the injunction. Their past conduct, the threat of further United States proceedings, the absence of an identified alternative forum, the English connections of the dispute, and the proposed punitive damages all supported continuation. The injunction did not prevent an application for permission concerning identified proceedings, where the court would require evidence of the parties, subject matter, causes of action and forum.
5. The injunction was varied to permit applications under section 1782 of Title 28 of the United States Code in support of English proceedings, provided seven days’ prior notice was given to each respondent. Assistance to Mill Financial was confirmed not to fall within the injunction.
6. The application to strike out or stay was dismissed. NESV was joined. The application for permission to serve Investment out of the jurisdiction was dismissed as unnecessary.