Teekay Tankers v STX Offshore

The court determined that the Claim Form had been validly served on the defendant, an overseas company, at the United Kingdom address shown on the Companies House register pursuant to section 1139(2) of the Companies Act 2006 and, alternatively, as a "place of business" under section 1139(2)(b) and CPR r.6.9(2) para.7. The judge construed the Overseas Companies Regulations and the statutory scheme to require registration of persons authorised to accept service and rejected the defendant's argument that such authority is limited to documents "in respect of the establishment". Factually, the London address was also held to be a place of business.

On forum non conveniens the judge applied the Spiliada principles and concluded that England was the clearly appropriate forum given (inter alia) that the Option Agreement was governed by English law, the central issues were primarily issues of English law, the overlap and efficiency with pending London arbitrations, the documentary position and witness considerations. Accordingly the application for a stay was refused and, if permission to serve out had been required, it would have been granted.

Background and nature of the claim

Teekay sued STX for damages for repudiatory breach of an Option Agreement dated 5 April 2013 concerning options to order further oil tankers. The Option Agreement was governed by English law. Teekay alleged that STX refused to enter shipbuilding contracts for optional vessels and that Teekay terminated the Option Agreement and claimed damages. Parallel arbitrations under the Shipbuilding Contracts had been commenced in London by the buyers; STX commenced proceedings in South Korea seeking a declaration of non-liability.

Procedural posture and relief sought

• STX applied under CPR Part 11 to challenge the English court's jurisdiction, contending that service in England had not been effective and alternatively seeking a stay on forum non conveniens grounds.
• Teekay applied for permission to serve out of the jurisdiction under CPR r.6.37 if in the alternative service in England were ineffective.

Issues framed

1. Whether STX had been validly served in England.
2. If served, whether the proceedings should be stayed on forum non conveniens grounds.
3. If not served, whether permission should be given to serve out and whether England is the proper forum.

Court's reasoning on service

The judge analysed s.1139(2) of the Companies Act 2006 and the mandatory requirement in s.1056(a) that regulations require overseas companies to register particulars identifying every person in the United Kingdom authorised to accept service. He construed Reg.7 of the Overseas Companies Regulations 2009 as requiring particulars of persons authorised to accept service on behalf of the company in respect of the establishment, but held that the qualifying phrase attaches to the person, not to the documents, and does not limit the scope of documents on which that person may be served. The court relied on the statutory purpose, explanatory materials and the historical context (including the Saab decision) to reject STX's narrower construction. As a result service on the named registered person at the London address was valid under s.1139(2)(a).

The judge further held, alternatively, that the London address was a "place of business" within s.1139(2)(b) and CPR r.6.9(2) para.7. The court treated the Companies House registration statement (that the UK establishment had opened and was a liaising office) as prima facie evidence, and found on the facts that business activity and arrangements existed at the address (website listing, personnel, bank account arrangements, contractual steps to take on the lease) sufficient to constitute a place of business.

Court's reasoning on forum conveniens

Applying the Spiliada framework, the court found that England was the clearly appropriate forum. Factors favouring England included the express choice of English law, the predominance of legal issues of English law (construction, certainty, interaction of contractual and common law remedies, frustration and quantification of damages), convenience and efficiency arising from overlap with pending London arbitrations, the language and documentary position, and the relative ease and cost of trial in England for the issues at stake. The Korean proceedings were given little weight because both sets of proceedings were at an early stage and the English proceedings were commenced promptly; the court also noted that STX had induced some delay by representing arbitration might be acceptable. The judge therefore refused STX's stay application and stated that, if permission to serve out had been necessary, he would have granted it.

First instance: The Claim Form was validly served on STX in England. STX’s application for a stay on forum non conveniens grounds is refused. In the alternative, had permission to serve out of the jurisdiction been required, the court would have granted permission because England is the clearly appropriate forum based on the predominance of English law issues, the overlap with London arbitrations, documentary and witness considerations.