Brownlie v Four Seasons Holdings Inc

Where the applicable limitation law is foreign and the relevant choice-of-law rules disapply the Foreign Limitation Periods Act 1984, substitution of a new defendant does not relate back to the commencement of the original proceedings. The claimant therefore need only show a reasonably arguable claim, including a reasonably arguable answer to limitation, unless the applicable procedural rule makes a different threshold necessary.

The court may achieve substitution in substance under CPR r.19.2 by adding the new party and removing the existing party. A claimant may rely on the presumption that foreign law is the same as English law where the foreign law evidence is incomplete. Permission to serve out requires a jurisdictional gateway, a reasonably arguable claim and England being the proper forum.

The claimant sought to substitute FS Cairo (Nile Plaza) LLC, an Egyptian company responsible for operating the Cairo hotel, for Four Seasons Holdings Incorporated in proceedings arising from a fatal road accident during an excursion booked through the hotel.

The Supreme Court had previously held that there was no reasonably arguable claim against Holdings and remitted consequential matters to the High Court, permitting an application to substitute or add a party. The claimant sought substitution, amendments to the pleadings and permission to serve LLC out of the jurisdiction. The central issues were whether substitution was permitted under CPR r.19.2 or r.19.5, whether the claims were reasonably arguable under Egyptian law, whether the jurisdictional gateways were satisfied, and whether England was the proper forum.

1. Substitution. The court ordered that LLC be added as a party and Holdings cease to be a party under CPR r.19.2(2) and (3). CPR r.19.2(4) did not provide the only route to substitution in substance. The Court of Appeal’s decision in London Borough of Hounslow v Cumar supported that conclusion.
2. Limitation and relation back. Under Rome I and Rome II, Egyptian law governed limitation. Section 8 of the Foreign Limitation Periods Act 1984 disapplied section 1 of that Act, and consequently section 35 of the Limitation Act 1980 did not apply. Substitution therefore would not relate back. The claimant was not required to establish that LLC had no reasonably arguable limitation defence. It was sufficient that the claims and the answers to the proposed limitation defences were reasonably arguable.
3. Alternative CPR r.19.5 analysis. If CPR r.19.5 applied, the claimant had a reasonably arguable case that the limitation period was current when proceedings began and that Holdings had been named in mistake for LLC. The three-part approach in Adelson v Associated Newspapers Ltd was satisfied. It was unnecessary to decide the alternative argument under r.19.5(3)(b).
4. Merits and foreign law. The claims in contract and tort were reasonably arguable. The claimant could rely, at this interlocutory stage, on Dicey’s Rule 25(2), namely the presumption that foreign law is the same as English law in the absence of satisfactory evidence to the contrary. The court accepted that the Egyptian law evidence did not make the claims unarguable.
5. Jurisdiction and forum. The contract gateway in Practice Direction 6B paragraph 6(a) was satisfied because there was a good arguable case that the telephone contract was made in England. The tort gateway in paragraph 9(a) was also satisfied because consequential damage in England was sufficient. The court preferred the majority observations in the earlier Supreme Court decision in the same litigation, although those observations had been obiter. Applying the principles in Spiliada Maritime Corporation v Consules Ltd (The Spiliada), England and Wales was the proper forum. Permission to serve LLC out of the jurisdiction was granted.

• Supreme Court: In the earlier same-litigation decision, Holdings’ appeal was allowed because there was no reasonably arguable claim against it; consequential matters were remitted to the High Court. The citation was [2017] UKSC 80 in the judgment’s procedural account, with the formal judgment also identified as [2018] UKSC 80.
• High Court (Queen’s Bench Division): The present court determined the remitted applications and granted the claimant’s requested procedural relief.