Harrington & Charles Trading Company Limited (in liquidation) & Ors v Jatin Rajnikant Mehta & Ors

On a forum non conveniens challenge, the defendant must first show that the proposed foreign forum is available and then that it is clearly or distinctly more appropriate than England. In complex international litigation, the dispute must be characterised by substance rather than by the form of the pleaded causes of action or the location of one part of the events. The court should consider the whole dispute, including the parties, the issues, related proceedings, applicable law, witnesses and documents, and fragmentation. India was available, but the defendants failed to show that it was clearly or distinctly more appropriate than England. The English proceedings were therefore neither stayed nor declined jurisdiction.

The liquidators of six English companies and related claimants brought claims against members of the Mehta family arising from an alleged international fraud involving bullion, defaults by Indian companies, and the movement of funds through companies in several jurisdictions. The claims included equitable, proprietary, conspiracy and insolvency claims under the Insolvency Act 1986, together with contribution claims.

The First to Fourth Defendants applied under CPR Part 11 for the English court to decline jurisdiction or stay the claims in favour of India. The central issues were whether India was an available forum, whether it was clearly or distinctly more appropriate than England, and whether justice nevertheless required the English proceedings to continue.

1. Characterisation of the dispute. The dispute could not be characterised merely as an Indian debt-recovery dispute concerning losses suffered by consortium banks, nor merely by reference to the pleaded English causes of action. The matter to be tried comprised both whether the alleged international fraud occurred, including the misappropriation, defaults and laundering of funds through an international corporate network, and whether the English claimant companies or their liquidators had claims of their own against the defendants.
2. Availability. India was an available forum. The defendants offered undertakings to submit to the jurisdiction of the Indian courts, subject to an appropriate permission-to-apply provision. The Indian bankruptcy moratorium was relevant to the appropriateness and justice inquiries, but did not make India unavailable. Nor had a genuine issue been raised showing that Indian courts would refuse to recognise the liquidators’ authority.
3. Appropriateness. Applying the two-stage approach in Spiliada, the defendants bore the heavy burden of showing that India was clearly or distinctly more appropriate. The parties’ present locations, the English incorporation and insolvency of the claimant companies, the international nature of the alleged fraud, the absence of direct identity between the English claims and the Indian proceedings, and the location of important defendants, witnesses and documents did not establish India as the clear forum.
4. The Indian proceedings were principally debt-recovery, insolvency, criminal or separate conspiracy proceedings. They did not create a sufficient identity of parties or issues to produce a serious risk of conflicting judgments or compel the defendants to litigate the same subject matter in both jurisdictions. The moratorium created a risk of fragmentation if claims could not proceed against the First Defendant in India, which weighed against India.
5. The applicants failed to discharge the first-stage burden. England was, if anything, the more appropriate forum. The second stage of the Spiliada inquiry therefore did not arise. The jurisdiction applications were dismissed. The strike-out applications remained to be heard separately.

First-instance decision. The jurisdiction applications under CPR Part 11 were dismissed. Related strike-out applications remained outstanding.