Axis Corporate Capital UK II Ltd & Ors v ABSA Group Ltd & Ors

A jurisdiction clause must be construed in its contractual and commercial context. A clause requiring parties to submit disputes to the Courts of England and Wales may confer exclusive jurisdiction even without using the word “exclusive”. The distinction between transitive and intransitive drafting is of limited assistance.

An implied term cannot be added merely because coordinated litigation would be more convenient or commercially desirable. Where proceedings breach an exclusive jurisdiction agreement, the court will ordinarily grant an anti-suit injunction unless strong reasons justify refusal, while retaining a cautious and fact-sensitive discretion. Without an exclusive clause, parallel foreign proceedings will not ordinarily be restrained unless they are vexatious or oppressive and intervention is required in the interests of justice.

The claimants were reinsurers under primary and excess reinsurance contracts connected with insurance provided by ABSA Manx Insurance Company Ltd to ABSA entities. The defendants had commenced proceedings in South Africa seeking indemnity under the reinsurance contracts.

An interim anti-suit injunction had been granted by Calver J. On the return date, the court was asked whether to continue it. The parties agreed that the contracts contained English governing-law provisions, but disputed whether the primary-layer and excess-layer jurisdiction clauses were exclusive and whether an injunction should restrain the South African proceedings.

1. Primary layer. The primary-layer clause did not confer exclusive English jurisdiction. Its reference to “worldwide jurisdiction” was inconsistent with that construction. Nor could an implied term requiring disputes affecting excess or aggregate-retention cover to be litigated exclusively in England and Wales be established. Applying Marks & Spencer v BNP Paribas [2016] AC 742, the proposed term was neither necessary for commercial practical coherence nor so obvious that it went without saying. Avoiding inconsistent decisions and duplicated costs was insufficient, particularly since the proposed term could itself produce arbitrary and commercially undesirable results (paras [48]-[60]).
2. Excess layers. Construed in context, sentence (2) of the excess-layer clause required each party to submit disputes to the Courts of England and Wales and no other court. The choice-of-law provision, the commercial advantages of certainty and predictability, and the context of the clause supported exclusivity. The service-of-suit provision and general conditions did not materially displace that conclusion. The transitive/intransitive distinction was of little assistance. Article 25(1) of the Recast Brussels Regulation would, if necessary, have supplied a presumption of exclusivity (paras [61]-[77]).
3. Primary-layer anti-suit relief. The South African primary-layer proceedings were not shown to be vexatious, oppressive or unconscionable. England was not clearly the natural forum: the relevant knowledge and notification evidence and underlying claims were centred in South Africa. Parallel proceedings and the desirability of one forum did not justify intervention (paras [81]-[87]).
4. Excess-layer anti-suit relief. The defendants failed to show strong reasons for refusing enforcement of the exclusive jurisdiction agreement. The court retained a cautious discretion, but restraining the excess-layer proceedings reduced the overlap, enforced the parties’ contractual promises, and avoided unfairness to reinsurers who subscribed only to excess layers. The injunction was continued for the excess-layer proceedings but not for the primary-layer proceedings (paras [88]-[98]).

The judgment concerned the return date of an interim anti-suit injunction granted by Calver J on 2 February 2021. The court varied the interim position by declining to restrain the South African primary-layer proceedings while continuing the injunction in respect of the excess-layer proceedings.