Mandy Debra Morgan v Sydney Charles Financial Services Limited

Permission to serve proceedings out of the jurisdiction requires a serious issue to be tried, a good arguable case that a jurisdictional gateway applies, and a showing that England and Wales is clearly the appropriate forum.

A remote employee’s home is not a branch, agency or establishment merely because the employee works there permanently. An agent must do more than act as an administrative conduit for a contract to be made through that agent. For service-out purposes, some contractual breaches occurring in the jurisdiction may suffice, and financial damage may be sustained there by a resident claimant even when the person is temporarily abroad.

Forum convenience must be assessed in the interests of all parties and the ends of justice. Funding difficulties and a foreign limitation bar may justify proceeding in England where the claimant acted reasonably.

The claimant, acting as executrix of the estate of Leslie Smith, brought proposed claims against a Guernsey financial-services company concerning two short-term life-assurance policies arranged in 2013 and 2015. She alleged breach of contract and duties arising in contract, tort and under UK and Guernsey regulatory schemes.

The defendant had not submitted to the jurisdiction and was based and regulated in Guernsey. The claimant sought permission under CPR rules 6.36 and 6.37 and Practice Direction 6B, relying principally on gateways concerning an establishment or agency, contracts made through an agent, contractual breaches, and damage sustained in the jurisdiction. The central issues were whether the gateways were established on a good arguable case and whether England and Wales was clearly the appropriate forum, particularly because the Guernsey claims were now time-barred and the claimant could fund proceedings only in England.

1. Application allowed. Permission was granted to serve the claim form on the defendant in Guernsey.
2. The three requirements for service out were satisfied in principle by a serious issue to be tried, a good arguable case that one or more gateways applied, and a showing that England and Wales was clearly the appropriate forum. The serious-issue requirement was conceded for the application.
3. The claimant failed on the gateway concerning a branch, agency or other establishment. The relevant concepts required a permanent-looking centre of operations, with management and material equipment enabling it to negotiate business with third parties. A remote administrator’s home, connected to a Guernsey office and used for convenience, did not meet that description.
4. The contract gateway based on contracts made through an agent was not established. The administrator did not negotiate or ascertain the contractual terms and merely transmitted documents and communications. That was materially different from the agent in National Mortgage & Agency Company of New Zealand Ltd v Gosselin, whose mediation negotiated the terms even though the foreign principals retained authority to accept them.
5. The contractual-breach gateway was made out. Although most pleaded breaches were framed as omissions, allegations of failure to exercise reasonable skill and care could encompass acts performed inadequately within the jurisdiction, including inadequate explanations and unsuitable policies. It was unnecessary to show that every breach occurred there.
6. The tort gateways concerning damage sustained and an act committed within the jurisdiction were also established. Applying FS Cairo (Nile Plaza) LLC v Brownlie, financial damage was capable of constituting damage for the gateway. The deceased’s residence in England meant that his temporary presence abroad did not prevent the damage being sustained within the jurisdiction.
7. On forum conveniens, Guernsey was otherwise the more appropriate forum. The defendant’s incorporation, regulation and operations were centred there, while many English connections carried limited or neutral weight. However, the claimant had acted reasonably. The evidence showed that she could not afford litigation in Guernsey, could obtain ATE insurance and a conditional fee agreement only for English proceedings, and would otherwise lose the opportunity to have her claim heard. Applying the practical-justice principle in Spiliada Maritime Corpn v Cansulex Ltd and Altimo Holdings and Investment Ltd v Kyrgyz Mobil Tel Ltd, England and Wales was clearly the appropriate forum.