07 APR 2017
Reform of the Gateways for Service Out
BackgroundWhen a claimant suffers personal injury abroad the first question is whether they can bring a claim in this jurisdiction. Very often the proposed defendant is domiciled abroad, has no presence in this country, will not submit voluntarily to English jurisdiction, and has not signed a prior jurisdiction agreement in favour of the English courts.
In such cases, where the defendant is domiciled in the EU a claimant can (at least for now) rely on the helpful provisions of Brussels 1A. But where a proposed defendant is domiciled in a non-EU country Brussels 1A does not apply. The matter is governed by the common law rules which impose 3 conditions for this country’s courts to assume jurisdiction:
- There must be a serious issue to be tried on the merits.
- There must be a good arguable case that the claim falls within one or more of the “gateways” listed in CPR PD 6B, paragraph 3.1.
- England must be distinctly the appropriate forum for trial.
ReformWith effect from 1 October 2015 (as part of the 81st update to the CPR) the list of gateways in CPR PD 6B was significantly altered. For the most part the changes are significant but unlikely to affect personal injury claims. There is a new gateway (21) for claims of breach of confidence or misuse of private information. Several existing gateways have been expanded, e.g. the property gateway (11), administration of an estate (13), claims against the defendant as a constructive trustee (15), and claims for restitution (16). Expanded gateways for trust claims were also introduced in April 2015.
However, 2 areas are of potential interest to personal injury lawyers, namely changes to the existing tort gateway (9) and the creation of a new general gateway (4A).
Tort gateway (9)Before October 2015 the tort gateway applied where a claim was made in tort and damage was sustained in the jurisdiction, or from an act committed within the jurisdiction. The meaning of “damage” and “sustained within the jurisdiction” was controversial and, for many claimants, pivotal.
A series of first instance decisions interpreted the gateway broadly. A claim was said to qualify even if the injuries giving rise to it occurred abroad and a claimant suffered only consequential loss in England (e.g. Cooley v Ramsey  EWHC 129).
However, the Court of Appeal overturned this in Brownlie v Four Seasons Holdings Inc  EWCA Civ 665, a decision followed in several cases since. The claimants were involved in a car accident while on a holiday excursion in Egypt. The excursion was pre-booked on the telephone with a concierge of their hotel in Cairo. One of the claimants was killed in the accident. His widow was injured. She subsequently commenced proceedings in England against the Canadian corporation which ran the chain of hotels. She brought a claim in breach of contract and 3 tort claims (for her own injuries, for loss of dependency under the Fatal Accidents Act 1976, and for her husband’s losses in her capacity as executrix).
The court held that her own claims for personal injury did not satisfy the gateway and could not therefore be pursued in England. The court construed the gateway consistently with the relevant European instruments on jurisdiction (Brussels 1A) and choice of law (Rome II). This entailed a narrow definition of “damage” which did not extend to consequential loss. “Damage” for the purposes of the gateway had occurred only in Egypt. The claim under the 1934 Act failed to qualify for the same reason.
The court did, however, find that the claim under the Fatal Accidents Act qualified because, for the purposes of that claim, she had sustained damage in England. She was also permitted to pursue her claim in contract because the contract was made in England and the claim thereby satisfied the contract gateway (6).
The changes to the tort gateway do not confront these fundamental issues. They amend the wording of the gateway to cover claims in tort where “(a) damage was sustained, or will be sustained, within the jurisdiction; or (b) damage which has been or will be sustained results from an act committed, or likely to be committed, within the jurisdiction.” However, it appears this is simply designed to ensure a match with the wording of the new gateway 21 dealing with claims of breach of confidence or misuse of private information.
The present situation, which is controversial and much less favourable to claimants than it was before Brownlie, therefore remains. The reason for this may simply lie in the timing rather than any value judgment. The decision in Brownlie was only handed down in July 2015. This was very late in the process. It may be that these issues will receive further consideration in the future.
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New general gateway (4A)The reforms also create a new general gateway (4A). This applies where “a claim is made against the defendant in reliance on one or more of paragraphs (2), (6) to (16), (19) or (21) and a further claim is made against the same defendant which arises out of the same or closely connected facts.”
The purpose is to enable related claims against the same defendant to be tried together in England. It applies even if the further claim would not by itself satisfy a gateway. It is distinct from (and broader than) the “necessary and proper party” gateway (3) which requires there to be a claim against another “anchor” defendant. However, in order to rely on it a claimant will need to first establish another claim which satisfies one of the gateways listed.
Strikingly this reform would reverse the outcome in Brownlie. The widow’s claims (for her own personal injury and as executrix), which were said not to satisfy the tort gateway, could now be brought under gateway 4A. She would be able to rely on the claim against the defendant under the contract gateway (6) as arising under the same or closely connected facts. She might also seek to rely on the tort gateway (9) in respect of the Fatal Accident Act claim.
However, while the result in Brownlie would be reversed, the assistance this reform offers claimants across the board is more limited. In cases where there are viable alternative claims (e.g. in contract or under the Fatal Accidents Act), it may be possible to side-step the narrow interpretation of the tort gateway. But in many cases there is no contract and no Fatal Accident Act claim. Take for example a road traffic accident claim against in a non-EU country against the driver of the vehicle where there is serious injury but no death.
ConclusionThe reforms provide some assistance to claimants seeking to establish jurisdiction in personal injury claims in non-EU countries. But this assistance is limited and is likely to apply only in cases where the claimant can establish viable alternative claims in contract or in tort and can rely on the new general gateway (4A). The reforms do not address the controversial issue at the heart of the tort gateway (i.e. the interpretation of “damage” and “sustained within the jurisdiction”). Any change here is likely to have to await a decision of the Supreme Court or further specific legislation.