Catlin Syndicate Ltd v AMEC Foster Wheeler USA Corp

An exclusive English jurisdiction clause in an insurance contract must be given its ordinary meaning. Other policy provisions cannot disapply or substantially undermine it unless they contain clear contractual language doing so.

Where proceedings are brought abroad in breach of such a clause, the court will ordinarily grant an anti-suit injunction. Once the clause is established to a high degree of probability, the defendant must show strong reasons for refusing relief. The merits of the underlying insurance claim, particularly where the foreign proceedings rely on a different law, ordinarily do not constitute such reasons.

A without-notice anti-suit injunction may be continued where the alleged non-disclosures concern matters immaterial to the jurisdictional application.

The claimant insurers issued an excess insurance policy to the defendants. The policy contained an express choice of English law and exclusive English jurisdiction clause. The defendants disputed coverage for defence costs arising from substantial Texan litigation.

Instead of suing in England, the defendants commenced proceedings in New Jersey and obtained without-notice orders requiring payment of past and future defence costs. The insurers obtained an English anti-suit injunction and applied for its continuation, together with mandatory relief requiring withdrawal of the New Jersey proceedings.

The central issues were whether the policy contained an exclusive English jurisdiction agreement, whether the policy’s interlocking provisions displaced that agreement, whether there were strong reasons not to enforce it, and whether the insurers had breached their duty of full and frank disclosure.

1. Disposition. The anti-suit injunction was continued. Mandatory relief was granted requiring the defendants to withdraw the New Jersey proceedings. The defendants’ cross-applications were dismissed.
2. Jurisdiction agreement. The express clause in the First Excess Policy clearly provided for English law and the exclusive jurisdiction of the English courts. The dispute concerning recoverability of defence costs fell within its scope. The defendants’ argument that other policy provisions had eviscerated the clause was untenable.
3. Interlocking clause. Memorandum 34 concerned the scope of coverage under the Primary and Local Policies. It did not alter their applicable law, jurisdiction or arbitration provisions. In any event, Condition 7 of the First Excess Policy preserved the primacy of its express terms.
4. Anti-suit principles. The court had to be satisfied to a high degree of probability that the jurisdiction agreement governed the dispute. Once that was established, strong reasons were required before relief could be refused. No such reasons existed. The defendants’ alleged strong case on coverage, the New Jersey payment order and the consequences of delay did not justify litigation in a forum applying a different law. Any merits-based application should be made in England under Civil Procedure Rules 1998, Part 24 or Part 25.
5. Disclosure and terms. The alleged non-disclosures were immaterial or non-culpable. The court declined to order payment of defence costs as a condition of continuing the injunction. The defendants could pursue properly formulated English applications for summary judgment or interim payment.