KWOK HO WAN & Ors v UBS AG (LONDON BRANCH)

Permission to appeal may properly be granted where the authorities on a jurisdictional issue are materially unclear, the proposed argument has a real prospect of success, and the factual circumstances provide a useful opportunity for appellate clarification. This applies even where the first-instance judge remains satisfied with the conclusion reached. The scope of the reasoning in flyLAL concerning Article 5.5, including whether tortious involvement is required, remained sufficiently uncertain to justify appellate consideration. Permission was granted on the substantive grounds identified as grounds 2 to 5.

The claimants opposed the defendant’s application for permission to appeal the court’s earlier judgment in this commercial jurisdiction dispute. The proposed appeal concerned, among other matters, the interpretation of Article 5.3 and Article 5.5, including the application and scope of flyLAL. Mrs Justice Cockerill considered the authorities difficult and not entirely clear, and concluded that grounds 2 to 5 had a real prospect of success. Permission was granted on those grounds only. The court also determined the costs of the application.

1. Permission to appeal. Permission was granted on grounds 2 to 5 only. The judge considered those grounds to represent the substance of the dispute and accepted that the relevant authorities were difficult and lacked complete clarity.
2. Article 5.3. No English or European decision squarely addressed the issue. The uncertainty in the EU authorities, together with the judge’s recognition that the defendant’s argument might be preferred by another judge, established a real prospect of success. The factual complexity also made the case suitable for appellate testing and clarification.
3. Article 5.5 and flyLAL. The judge rejected the defendant’s criticisms that she had overstepped in analysing the authorities or had failed to apply flyLAL. Nevertheless, the authorities left live the question whether tortious involvement was required. The appeal therefore offered an appropriate opportunity to clarify the meaning and scope of flyLAL.
4. Costs. The claimants were awarded 85 per cent of the costs sought, payable within 14 days. The court made modest reductions for partner rates, partner time and duplicated involvement in the case.

The judgment records an application for permission to appeal the court’s earlier judgment. Permission was granted on grounds 2 to 5 only.