Evison Holdings Ltd v International Company Finvision Holdings LLC & Ors

On an ex parte application for service out of the jurisdiction, material facts are those which could reasonably affect the decision or cause the court to doubt whether permission should be granted. Disclosure of a claimant’s participation in foreign proceedings is required where that participation gives rise to an argument sufficiently weighty to affect the reasonable-prospects-of-success test. The court is not required to conduct a full merits examination once a serious issue to be tried is shown.

Alternative service in a Hague Service Convention country requires exceptional circumstances. Litigation prejudice caused by delay, including the risk of separate hearings and inconsistent findings, may amount to such circumstances. Material but non-deliberate non-disclosure does not invariably require discharge where the order would probably have been made on proper disclosure and the interests of justice favour reinstatement, although costs may mark the court’s disapproval.

Evison sought to maintain orders permitting service out of the jurisdiction, and service by alternative means, of contempt proceedings against two Russian nationals. The alleged contempt concerned breaches of an anti-suit injunction supporting an LCIA arbitration.

The orders had been granted without a hearing. Evison had not fully disclosed its participation in related Russian proceedings, the applicable exceptional-circumstances test for alternative service in Russia, or that one proposed defendant had previously been a de jure director. The issue was whether the orders should be set aside or reinstated.

1. Materiality and disclosure. Materiality depends on the decision the court is being asked to make. On an ex parte application for service out, the claimant must disclose facts which could reasonably affect the decision or cause the judge to doubt whether permission should be granted. Participation in foreign proceedings must be disclosed where an argument based on that participation is sufficiently weighty to risk misleading the court on whether the claim has a reasonable prospect of success.
2. Merits and submission. The court considered whether Evison’s participation in the Russian proceedings could amount to submission to the Russian jurisdiction and waiver of the anti-suit injunction breaches. Applying the approach in Rubin v Eurofinance and AES v UST, the question depended on the totality of the circumstances. Participation on the merits did not, on the chronology as a whole, make the waiver argument sufficiently strong to undermine the reasonable prospects of the contempt claim.
3. Alternative service. In a case involving a country subject to the Hague Service Convention, alternative service required exceptional circumstances. Delay alone was insufficient. Here, the imminent contempt trial, the need for all respondents to be heard together, the risk of increased costs and the risk of inconsistent findings constituted litigation prejudice amounting to exceptional circumstances.
4. Consequences. The failures to disclose the applicable test and the former directorship were culpable but not deliberate. The orders would probably have been made had proper disclosure occurred. Although the usual consequence of material non-disclosure is discharge, the interests of justice favoured reinstatement because separate hearings could damage the administration of justice. The orders were therefore set aside and immediately reinstated, with costs to mark the breaches.

First-instance decision. The judgment does not state any prior appellate decision in the same proceedings.