Dell Emerging Markets (EMEA) Ltd & Ors v Systems Equipment Telecommunications Services SAL

Courts will ordinarily restrain foreign proceedings brought in breach of an exclusive jurisdiction clause unless the resisting party establishes good or strong reasons. At the interim stage, the applicant must show a high degree of probability that the clause exists and has been breached, and must act promptly. The Ralli Bros principle does not make an English jurisdiction clause unenforceable merely because the foreign court would disregard it under its own law. The relevant question is whether contractual performance necessarily requires an unlawful act in the place of performance. A statutory claim may nevertheless fall within the clause where, in substance, it seeks compensation dependent on the parties’ contractual rights, obligations and circumstances of termination.

The claimants sought an interim anti-suit injunction restraining SETS from pursuing proceedings in Lebanon. Those proceedings alleged that Dell had unlawfully terminated an exclusive commercial representation relationship and sought compensation under Decree 34/67.

The claimants relied principally on the exclusive jurisdiction clause in the 2004 international distribution agreement, which selected the High Court of England. SETS argued that the clause was unenforceable under the Ralli Bros principle, that the Lebanese claim was statutory and independent of the contract, and that any agreement with Dell France remained subject to the 1991 agreement and French jurisdiction. The central issues were whether the jurisdiction clause was enforceable, whether the Lebanese claim was contractual in substance, and whether the claimants had met the interim threshold.

1. The application succeeded. The court granted an anti-suit injunction because the claimants established a high degree of probability that the Lebanese proceedings breached the exclusive jurisdiction clause in the 2004 IDA.
2. The ordinary approach is to restrain foreign proceedings brought in breach of an exclusive jurisdiction clause unless the party resisting relief shows good or strong reasons. The burden lies on that party. The application must also be made promptly and before the foreign proceedings are too far advanced.
3. The Ralli Bros principle was inapplicable. It applies where performance necessarily involves an act unlawful under the law of the place where the act must be done. Supplying goods and services in Lebanon was not itself unlawful. The possibility that Lebanese courts would refuse to enforce the English jurisdiction clause did not make performance unlawful or provide a strong reason against relief.
4. Characterisation was a question of English law. The court considered the substance and content of the right asserted, rather than its formal description. Decree 34/67 did not create a right wholly independent of the contractual relationship. The claim required examination of whether the agreement was exclusive, whether termination occurred without fault or lawful cause, and what compensation followed.
5. The Lebanese claim was therefore, in substance, a claim for compensation for breach of contract and fell within clause 27 of the 2004 IDA. The 2004 agreement was the relevant agreement at termination. For present purposes it was unnecessary to decide conclusively whether the arrangement was exclusive.
6. As to Dell France, the evidence established a high degree of probability that the 1991 IDA had been terminated in 2004. The 2004 agreement therefore supplied the relevant exclusive jurisdiction clause for the claim brought against Dell France.