Dr Markus Boettcher v Xio (UK) LLP (in liquidation) & Ors

The claimant sued in deceit, under section 2(1) of the Misrepresentation Act 1967 and for breach of duty of care, alleging inducement to enter employment by false representations about Xio Group's funds under management. The court held that service on the second defendant at 33 Savile Row was valid because, on the evidence available and as at the date of service, that address amounted to his last known residence within the meaning of CPR rule 6.9. The defendants had not submitted to jurisdiction either statutorily (CPR 11(5)) or at common law. On forum non conveniens the defendants failed to show that Germany was clearly and distinctly a more appropriate forum than England; important connecting factors pointed to England, including that the employment contract was concluded with and to be performed substantially for Xio UK in England and there was a good arguable case that English law applied (Rome II Article 4 / Article 12 issues considered). The court also rejected the contention that the claimant breached the duty of full and frank disclosure on his without-notice application to serve out.

Background and nature of the application:

The claimant, formerly Global Head of Value Creation at Xio UK, alleged he was induced to leave his prior employment and join Xio UK by misrepresentations about the Xio Group's capital under management. Proceedings were issued in England against Xio UK (in liquidation) and four individuals. The present interlocutory proceedings concerned contested jurisdiction: the Second and Third Defendants (Mr Geyer and Mr Pacini) challenged English jurisdiction and sought set-aside of an order permitting service out and/or a stay on forum non conveniens grounds.

Relief sought:

• Declarations that the English court lacked jurisdiction or would not exercise jurisdiction (stay).
• Set aside of the without-notice order permitting service of proceedings outside the jurisdiction.

Issues framed by the court:

1. Whether service within the jurisdiction on Mr Geyer at 33 Savile Row was valid under CPR rule 6.9.
2. Whether Mr Geyer and Mr Pacini had submitted to the jurisdiction (statutory or common law) and thereby lost the right to contest jurisdiction.
3. If not, whether England or Germany was the more appropriate forum (Spiliada / forum non conveniens), including the applicable law question under the Rome II Regulation (Article 4 and Article 12).
4. If relevant, whether the claimant satisfied the CPR PD 6B gateways so as to justify service out; whether there was a real prospect of success on the merits; and whether the claimant complied with the duty of full and frank disclosure on the without-notice application.

Court’s reasoning and conclusions (concise):

• Service at 33 Savile Row: the claimant had at the date of service a plausible evidential basis to treat that address as the defendant’s last known residence. Reasonable inquiries had been made and steps taken; conflicting evidence about porter's enquiries could not be resolved against the claimant on an interlocutory application. Therefore CPR rule 6.9 service was valid.
• Submission to jurisdiction: the defendants had filed acknowledgments of service indicating they would contest jurisdiction and thereafter pursued Part 11 applications within extended timetables. The court found no statutory (CPR 11(5)) or common law waiver amounting to submission to jurisdiction.
• Forum non conveniens: the defendants did not discharge the heavy evidential burden of showing Germany was clearly and distinctly the more appropriate forum. Key connections pointed to England: the employment contract was concluded with Xio UK in England, to be governed by English law and performed substantially in England, and there was a good arguable case English law applied to the tort claims (Rome II Article 4 may point to England because the damage arose on conclusion of the employment contract there). Risk of injustice in Germany (limitation) was considered but not decisive.
• Service out and gateways: if relevant, the claimant established a good arguable case under CPR PD 6B para.3.1(3) (necessary/proper party in Xio UK as anchor) and para.3.1(9)(a) (substantial damage within the jurisdiction), had a real prospect of success and satisfied CPR r.6.37(3) that England was the proper place.
• Duty of full and frank disclosure: the court found no material non-disclosure on the without-notice application that would have required setting aside the service-out order.

Subsidiary findings: service on the Third Defendant at The Shard was not challenged; Xio UK was in liquidation and one defendant had settled confidentially and been dismissed from the proceedings; limitation and applicable-law issues were identified as triable questions for trial.

First instance: The court dismissed the defendants' applications. The court held that service on Mr Geyer at 33 Savile Row was valid under CPR rule 6.9, that neither defendant had submitted to the court's jurisdiction, that Germany was not clearly or distinctly a more appropriate forum than England, and that the without-notice order permitting service out should not be set aside because the claimant had established the PD 6B gateways, a real prospect of success and had made sufficient disclosure.