PDVSA Servicios SA v Clyde & Co LLP & Ors

Joinder under CPR 19.2(2) is discretionary and requires one of the statutory conditions to be satisfied. The court may join a non-party even where its private-law rights will not be affected, if its presence is desirable in the broader interests of justice and the overriding objective. That possibility is particularly relevant where the non-party has a statutory interest in the operation of a regulatory regime affecting the dispute. However, joinder should be approached cautiously, especially where the statutory body can decide whether to intervene. The court cannot use joinder to determine an issue which belongs to another court or statutory forum. Where the underlying issue has fallen away, joinder is no longer desirable.

PDVSA Servicios SA and PetroSaudi Oil Services (Venezuela) Ltd were parties to confidential arbitration proceedings. An escrow account was operated by Clyde & Co LLP. Following a Malaysian order restricting dealings with the funds, and orders of the English High Court permitting specified payments, PetroSaudi sought to join the National Crime Agency to the proceedings.

The proposed joinder was intended to assist determination of an anticipated mandatory order requiring Clyde & Co to make payments, and to address the possible effect of a prohibition order under the Proceeds of Crime Act 2002 (External Requests and Orders) Order 2005. The central questions were whether the conditions in CPR 19.2(2)(a) or (b) were satisfied and whether joinder remained desirable once the NCA and Clyde & Co confirmed that Part 7 of POCA created no obstacle to the permitted payments.

1. Application refused. The NCA was not joined to the proceedings.
2. Under CPR 19.2(2), the court has no inherent jurisdiction to order joinder. Joinder is available only in the discretion of the court where one or both statutory conditions are met. The guidance in re Pablo Star Limited was guidance rather than a reformulation of the statutory test.
3. CPR 19.2(2)(b) was not satisfied. The issue concerning the form and extent of any prohibition order under the Proceeds of Crime Act 2002 (External Requests and Orders) Order 2005 had to be determined by the Queen’s Bench Division, which was the forum specified by that Order. The court hearing the proposed mandatory order could not resolve that issue.
4. CPR 19.2(2)(a) was capable in principle of applying even though the NCA had no private-law rights liable to be affected. The NCA had a clear statutory interest in the operation of Part 7 of the Proceeds of Crime Act 2002, particularly if a mandatory order might bypass or frustrate that regime. The reasoning in N v RBS demonstrated that the NCA could have a sufficient interest to be heard and that the POCA regime was highly relevant to the court’s discretion.
5. Nevertheless, the court should be wary of involving the NCA against its will in private commercial litigation. A litigant could not ordinarily require the NCA simply to explain its position. Any challenge to delay or inaction would generally need to be approached on the basis of judicial review, although joinder might provide a procedurally efficient course in a suitable case involving real urgency.
6. By the resumed hearing, the NCA had confirmed that Part 7 of POCA did not prevent the payments authorised by Trower J, and Clyde & Co had made or instructed the payments. No live issue remained which could make joinder desirable.

First-instance decision on an application to join the National Crime Agency to existing proceedings. The judgment records earlier orders made by Zacaroli J and Trower J, but no appeal from those orders was determined in this judgment.