The Public Institution for Social Security v Banque Pictet & CIE SA & Ors.

An exclusive jurisdiction clause satisfies the written-form requirement in article 23 of the Lugano Convention where a signed contract expressly incorporates general business conditions containing the clause. Real consent does not invariably require actual communication of the incorporated term.

When deciding whether it is expedient to assume connected-defendant jurisdiction under article 6, the court may consider all relevant risks of irreconcilable judgments. This includes conflicts with proceedings which must be brought in another state under an exclusive jurisdiction agreement. The court should assess whether accepting jurisdiction would increase or reduce those risks, while respecting party autonomy and the general rule favouring a defendant’s domicile.

The claimant, a Kuwaiti public social-security institution, alleged that its former director general received bribes from international financial institutions and intermediaries. It brought English proceedings against banks and individuals said to have participated in the bribery schemes and in laundering the proceeds.

Henshaw J held in [2020] EWHC 2979 (Comm) that exclusive jurisdiction clauses required central bribery and accessory claims to proceed in Switzerland or Luxembourg. He also declined jurisdiction over connected claims because trying them in England would create a greater risk of irreconcilable judgments. The claims against two non-European Pictet entities were stayed on forum non conveniens grounds.

The claimant appealed. The principal issues concerned the formal and material validity of the jurisdiction clauses, their scope, the proper approach to expediency under article 6 of the Lugano Convention and the appropriate forum for the remaining claims.

1. Appeal dismissed. The exclusive jurisdiction clauses satisfied article 23(1)(a) of the Lugano Convention. Where a signed contract expressly refers to general business conditions containing a jurisdiction clause, actual communication of those conditions is unnecessary. The signed incorporation establishes the required consensus. The distinction in Estasis Salotti was between direct incorporation in the signed contract and a contract referring only to an earlier offer. Höszig did not establish a general communication requirement: paras [56]–[78], [145(i)].

2. The material-validity inquiry requires identification of the particular legal relationship for which the clause was agreed and determination of whether the dispute arose from that relationship. The relationship need not be confined to the contract containing the clause. Its wider legal context may be considered, although a status such as banker and customer is insufficient by itself. On the broad wording used here, the relevant relationships comprised the totality of the parties’ legal relationships forming part of their banker-customer dealings: paras [80]–[87].

3. The bribery and associated accessory claims were directly and immediately connected with those relationships. They concerned investments placed with or through the banks and knowledge acquired as bankers. Their referral to the chosen courts would not cause relevant surprise. The wider accessory claims concerning the laundering of money generated by other schemes lacked the necessary contractual connection and remained outside the clauses: paras [88]–[104].

4. Article 6 required an evaluative assessment directed to avoiding irreconcilable judgments. The court could consider not only the anchor claim and the proposed connected claim, but also closely related proceedings which had to be brought in another state under article 23. Prospective proceedings could be considered on an informed basis. The question was whether accepting jurisdiction would increase or decrease the relevant risk, not which forum was generally more convenient: paras [105]–[132], [145(ii)].

5. Henshaw J permissibly concluded that trying the remaining claims in England would create a more serious risk of inconsistent findings concerning the same respondents and issues. There was no identifiable flaw in that evaluation. The claims against the remaining individuals therefore belonged in Switzerland. England was also not clearly the appropriate forum for the parasitic claims against the Bahamian and Singaporean entities: paras [133]–[146].

Carr LJ gave the judgment of the court. Simler LJ and Peter Jackson LJ agreed. The claimant was ordered to pay the respondents’ appeal costs, and permission to appeal to the Supreme Court was refused.

1. Court of Appeal (Civil Division): The appeal was dismissed in [2022] EWCA Civ 29. The jurisdictional conclusions and the refusal to exercise common-law jurisdiction were upheld.
2. High Court, Commercial Court: Henshaw J held in [2020] EWHC 2979 (Comm) that exclusive jurisdiction clauses excluded English jurisdiction over the central bribery and accessory claims. He declined jurisdiction over the remaining connected claims and the claims against the Bahamian and Singaporean entities.