Eurasia Sports Ltd v Aguad

For service outside the jurisdiction, damage in a tort claim is sustained where the event giving rise to it directly produces harmful effects on the victim. An act which merely exposes the claimant to risk is insufficient.

The additional-claim and necessary-or-proper-party gateways are complementary. A claim admitted through the former may support the addition of a proper party through the latter where the claims involve the same or closely connected facts. Any concern about an excessive extension of jurisdiction should ordinarily be addressed when deciding whether England and Wales is the appropriate forum.

A betting agency alleged that several Peru-based defendants had conspired to obtain unsecured betting facilities through false representations about security. It also claimed debts arising from their individual betting accounts. The appellant challenged the English court's jurisdiction over the conspiracy and debt claims against him.

Edis J rejected that challenge in [2016] EWHC 2207 (QB). He found that the tort gateway applied because damage was sustained in London, that the appellant was a proper party, that the related debt claim passed through the additional-claim gateway and that England and Wales was the appropriate forum.

The appeal concerned whether there was a serious issue to be tried, whether the claims passed through the jurisdictional gateways in the Civil Procedure Rules 1998, and whether England and Wales was clearly or distinctly the appropriate forum.

1. Appeal dismissed. The judge's conclusion that the English court had jurisdiction was upheld, although the Court of Appeal rejected his reasoning under the tort gateway.

2. The appellant was refused permission to argue for the first time that the pleaded betting debts could not constitute loss caused by the alleged conspiracy. Evidence and an alternative formulation of loss might have answered that argument if it had been raised below. Allowing it on appeal would therefore have been unjust.

3. For the tort gateway, damage is sustained where the event giving rise to it directly produces harmful effects on the victim. The grant of betting credit in London was merely preparatory. It exposed the claimant to risk, but damage arose only when bets were placed and lost. If the harm were characterised as non-receipt of money or security, it occurred in Malta, where payment should have been received. Nor was there a good arguable case that the claimant supplied gambling services from London. The conspiracy claim consequently failed to pass through the tort gateway.

4. The additional-claim gateway in paragraph 3.1(4A) and the necessary-or-proper-party gateway in paragraph 3.1(3) of the relevant Practice Direction are complementary. The former adds closely connected claims against an existing defendant; the latter adds parties to an existing claim. A claim admitted through paragraph 3.1(4A) remains a “claim” upon which paragraph 3.1(3) may build. The language did not imply an exclusion of claims admitted through paragraph 3.1(4A).

5. Contract claims against four defendants properly passed through the contract gateway. Their associated conspiracy claims arose from the same or closely related facts and therefore passed through paragraph 3.1(4A). The appellant was a proper party to that conspiracy claim because the claims required a common investigation. His personal debt claim was also closely connected, notwithstanding when that debt was incurred.

6. The judge made no error of principle in finding England and Wales clearly and distinctly the more appropriate forum. The likelihood that proceedings against other defendants would continue in England was a relevant factor. Its weight was for the judge, subject to appropriate caution when jurisdiction over foreign defendants depends on avoiding multiple proceedings.

1. Court of Appeal (Civil Division): In [2018] EWCA Civ 1742 , dismissed the appellant's jurisdictional appeal. The court upheld the result below through the additional-claim and necessary-or-proper-party gateways, while reversing the judge's conclusion that the tort gateway applied.
2. High Court, Queen’s Bench Division: Edis J, in [2016] EWHC 2207 (QB) , rejected the jurisdictional challenge and held that England and Wales was the appropriate forum.