Nova Leipzig Sarl v Gravity Fitness Limited

In a service-in forum non conveniens case, the defendant must show that the foreign forum is available and clearly or distinctly more appropriate. The defendant’s English domicile is both the basis for the burden and a powerful connecting factor favouring England. A foreign governing-law clause is only a working factor, particularly where the foreign law is undisputed or relatively narrow in scope. The court should assess the real and substantial connections, including where the parties’ evidence and litigation are coordinated, where the relevant acts occurred, and the location and language of witnesses. Cost, speed, prejudice and the defendant’s commencement of parallel foreign proceedings are not, without more, connecting factors sufficient to displace the English forum. A case-management stay should not ordinarily be granted merely because parallel proceedings may produce inconsistent judgments.

Nova, a Luxembourg company, brought a debt and damages claim in the Commercial Court against GFL, an English company, under a parent guarantee supporting the obligations of GFL’s dissolved English subsidiary in relation to a Leipzig lease. The guarantee and lease were governed by German law. GFL sought a stay under CPR 11(6)(d), arguing that the Halle Regional Court was available and clearly or distinctly more appropriate. It also sought a case-management stay pending German proceedings which it had commenced after Nova’s claim.

The court considered the availability of Germany, the comparative connecting factors, and whether the parallel proceedings justified a stay.

1. Forum non conveniens. The court applied the governing principles stated in Limbu v Dyson Technology Ltd [2024] EWCA Civ 1564. The available-forum requirement is a condition precedent. GFL’s undertaking to submit unconditionally to any German court chosen by Nova satisfied that requirement.
2. GFL failed to show that Germany was clearly or distinctly more appropriate. Its English incorporation and domicile were of substantial significance. They both placed the burden on GFL and operated as a powerful connecting factor because GFL could reasonably be expected to meet claims in its home jurisdiction.
3. The German governing-law clause was not decisive. It was a working rule only. The relevant German law was substantially undisputed, and the Commercial Court could apply it. The absence of a German jurisdiction clause also mattered: the choice of German law did not show an agreement that disputes would be determined in Germany.
4. Further factors favoured England. GFL’s defence and Nova’s claim would be coordinated from England. The guarantee was signed in England by GFL’s English-resident directors, whose states of mind were central. Most factual witnesses were in England and spoke English; a German trial involving interpreters would be less satisfactory. Electronic documents carried no weight, and the bilingual lease did not alter the analysis.
5. GFL’s later German proceedings, and arguments about cost, speed, prejudice and possible inconsistent judgments, did not displace the English forum. The application for an FNC stay was dismissed.
6. The case-management stay was also refused. It was not in the interests of justice to await proceedings in a forum which was not more appropriate. The risk of irreconcilable judgments was a consequence of GFL’s decision to pursue parallel proceedings and was insufficient to justify a stay.