The English courts have increasingly considered it necessary to comment on the amount of time and cost being spent on jurisdiction battles and the need for proportionality. In Vedanta Resources PLC and another v. Lungowe and others [2019] UKSC 20, the UK Supreme Court emphasised that jurisdiction disputes should be litigated in hours not days.²

Although the Supreme Court has set a clear objective that such applications need to be dealt with proportionately, how should parties in practice approach what can be hotly contested and fact-sensitive issues?

Legal context

Some of the challenges faced by parties lie in the nature of the legal test to be applied.

The key to establishing jurisdiction lies in service on the foreign defendant. Save in some specific circumstances,³ permission to serve a defendant out of the jurisdiction must be obtained from the English court. When seeking permission to serve out of the jurisdiction, a claimant must satisfy three key requirements (set out in AK Investment CJSC v. Kyrgyz Mobil Tel Ltd [2011] UKPC 7 at [71] and Civil Procedure Rules (CPR) 6.37):

1. There must be a serious issue to be tried on the merits of the claim;
2. There is a good arguable case that the court has jurisdiction under one of the jurisdictional gateways in Practice Direction 6B (PD 6B); and
3. In all the circumstances England and Wales is the appropriate forum to determine the dispute (often referred to as the question of whether England and Wales is the “forum conveniens”).

Serious issue to be tried

This is a merits-based protection, designed to ensure that a party who is outside the jurisdiction cannot be brought within the jurisdiction by reference to a claim which is bound to fail. This is tested to the summary judgment standard, i.e., whether there is a real, as opposed to fanciful, prospect of success.

Good arguable case

The next hurdle to overcome is that a party seeking permission to serve out must demonstrate a “good arguable case” that the claim falls within one of the PD 6B jurisdictional “gateways”.

Guidance has been given by the Supreme Court on the “good arguable case” test in two modern decisions: Brownlie v. Four Seasons Holdings Incorporated [2017] UKSC 80 and Goldman Sachs International v. Novo Banco [2018] UKSC 34. In Brownlie, Lord Sumption explained the test in three limbs (at [7]) as being:

1. That a claimant must supply a plausible evidential basis for the application of a relevant jurisdictional gateway;
2. That if there is an issue of fact about it, or some other reason for doubting whether it applies, the court must take a view on the material available if it can reliably do so; but
3. The nature of the issue and the limitations of the material available at the interlocutory stage may be such that no reliable assessment can be made, in which case there is a good arguable case for the application of the gateway if there is a plausible (albeit contested) evidential basis for it.

Whilst this commentary was obiter in Brownlie, it was later approved in Goldman Sachs (at [9]).

More recently, in Kaefer Aislamientos v. AMS Drilling Mexico [2019] EWCA Civ 10, the Court of Appeal provided further elucidation on the three limbs of the “good arguable case” test.

1. Limb (i): A “plausible evidential basis” was one in which the claimant has the “better argument” (at [73]). The standard is only plausibility (not the balance of probabilities). The court must be astute not to express a view on the ultimate substantive merits (at [77]). As to the relative level, the claimant does not have to show it has the “much” better argument.
2. Limb (ii): The court should seek to overcome the evidential difficulties inherent in interlocutory applications and to reach a conclusion if it “reliably” can (at [78]). Not every evidential dispute is material and the court must exercise pragmatism, not least because it should be conducted with “due despatch” and without oral evidence.
3. Limb (iii): In circumstances where the court cannot determine which party has the better argument, on the evidence, this limb is intended to provide a flexible test, not necessarily conditional upon relative merits, which combines a “good arguable case” and “plausibility of evidence” (at [80]).

What “plausible evidence” should a claimant rely on, and how should a defendant respond?

Whilst the guidance from the Supreme Court and Court of Appeal on the test to be satisfied is welcome, parties to jurisdiction disputes continue to face significant challenges in evaluating what evidence is actually required.

For a claimant, the test requires an assessment of the facts of the case and its merits. As such, this may well require evidence of the underlying claim and – in some circumstances – perhaps even preliminary reports from certain types of expert (for which permission from the court will be required, and so a claimant must be prepared to demonstrate why such reports are reasonably necessary).⁴

For a defendant resisting the jurisdiction of the English court, there are competing challenges. Whilst there will be a desire to rebut the claimant’s case on the merits (and adduce evidence in order to do so), the risk in seeking to litigate the case at an interim stage is that doing so may suggest that there is a real triable issue.

In addition to the factual evidence, there may be questions of foreign law – both true questions of foreign law which may go to the merits of a particular cause of action governed by foreign law and, potentially, more complicated questions of law and fact in relation to the ability of a litigant to obtain access to a fair hearing in the foreign jurisdiction. This latter point was a live issue in Vedanta Resources v. Lungowe.

There is a fine balance that both claimants and defendants must strike between, on the one hand, providing the court with sufficient information to assess whether the requirements of the legal test have been met, and, on the other hand, litigating in an interlocutory hearing a case which (when the full facts are laid out and witnesses cross-examined) might ultimately expect to be tried over a series of weeks or months. As noted above, the interests of claimants and defendants can sometimes pull in different directions when the question of the depth and nature of the evidence arises.

Finally, whilst sensible decisions surrounding the appropriate level of evidence may be taken on issue of an application, circumstances and facts change – not least if there is a competing claim proceeding in the foreign jurisdiction. Both parties will often be faced with the temptation to adduce further evidence to address matters as they develop and this can lead to a proliferation of statements and reports.

Striking the right balance

It is not in the interest of any party to a jurisdictional battle to face criticism from the court on the nature and extent of evidence relied on. The Supreme Court has issued words of caution about the management of such applications. It is open to a court to penalise a party in costs for submitting evidence which was ultimately not considered by the court (or not considered necessary or of assistance to the court).

How can parties and practitioners get the balance right? We discuss below some top tips for ensuring a smooth process:

Prepare a case strategy at an early stage

Identifying the issues in a case (both at the outset and as the application progresses) will help to plan and understand the scope and type of evidence a party may (or may not) need. Doing so will help avoid putting in unnecessary or excessive evidence. Any case strategy will, of course, need to be appropriately flexible to accommodate any significant, unexpected developments.

Instruct the right advisors and experts

As part of the case strategy, it is important that the right legal advisors and any experts are identified and instructed as early as possible. This includes any foreign law experts. Having the right team in place will ensure that decisions are taken efficiently and can help avoid unwanted and unexpected cost increases.

Agree an appropriate timetable

The CPR and Commercial Court Guide impose fairly stringent deadlines for the service of evidence in response to applications. These deadlines can be varied by consent (subject in some instances to the court’s approval). If additional time is expected to be needed for fact/expert evidence (for instance, to reflect the time needed for translations or for public or religious holidays in foreign jurisdictions), then the opposing parties should proactively engage with one another at an early stage.

Check whether permission is required for any expert evidence

Pursuant to CPR Part 35, expert evidence is a matter for the court. That the court controls expert evidence is intended to ensure that expert evidence is restricted only to that which is reasonably required. Permission should therefore be obtained for a party to rely on expert opinion, and planning early what evidence will be required will avoid last-minute applications. Think also about the form of any expert directions. Where the evidence is wide-ranging and detailed, the court may be assisted by (and may in some circumstances insist on) a joint statement identifying (with reasons) the differences between the experts.

Think about the form of hearing

Whilst cross-examination of an expert (or any other witness) on a jurisdiction challenge is unusual, there may be occasions where it could be sought, and thought should be given to this at an early stage.⁵ That will particularly be so where the jurisdiction question arises in respect of an arbitration clause in an application for a stay pursuant to section 9 of the Arbitration Act 1996.⁶

Reserve rights

A party to a jurisdiction challenge should ensure that any rights are appropriately reserved in any competing foreign proceedings or arbitration and the interplay between any two sets of competing proceedings will need to be closely considered at all times. This will often involve close and careful collaboration between different legal teams.

Conclusion

Applications challenging the jurisdiction of the English courts present potential hurdles for both claimants and defendants. Whilst determining the jurisdiction in which a claim will be heard is often important and may have a significant impact on the ultimate outcome of some cases, these interlocutory applications can sometimes be an expensive and time-consuming distraction from litigating the substantive dispute. With the right strategy and evidence in place, however, parties can navigate jurisdiction challenges efficiently and proportionately, allowing them to focus on resolving the substantive issues between them.

1. Which in the English courts are heard by way of application pursuant to section 9 of the Arbitration Act 1996. The courts have, on occasion, confirmed that a challenge by way of section 9 is not a jurisdiction challenge which engages CPR Part 11; see Bilta (UK) v. Nazir [2010] EWHC 1086 (Ch).
2. Citing commentary in Spiliada Maritime Corpn v. Cansulex Ltd [1987] AC 460, 465. In Okpabi and other v. Royal Dutch Shell Plc and another [2018] EWCA Civ 191, the evidence amounted to a total of 39 witness statements running to over 1,000 pages plus five expert reports. See similar commentary in VTB Capital plc v. Nutritek International Corp [2013] 2 AC 337 at [82]-[83]. Notwithstanding this stern warning, multi-day jurisdiction challenges do still occur in the English Commercial Court where, for instance, there are multiple parties and/or particularly complicated issues of foreign law or relevant background fact. Given the Supreme Court’s comment, however, parties would be wise to have jurisdiction challenges determined as proportionately as possible.
3. Such as where the claim is one to which the 2005 Hague Convention applies, or there is an agreement providing for the English court to have jurisdiction (see CPR 6.33(2B)).
4. See, for instance, Abram and Others v. Union Des Associations Européennes De Football [2024] EWHC 1518 (KB), which involved a last-minute application to adduce further foreign law expert evidence, which was refused.
5. See, for instance, the comments in Tyson International Company Ltd v. GIC Re [2024] EWHC 236 (Comm) at [107], and [115] (albeit those comments were made in the context of an anti-suit injunction, and not a jurisdiction challenge).
6. See, for instance, Al-Naimi v. Islamic Press Agency [2000] 1 Lloyd’s Rep. 522, confirming that such applications may be determined by way of trial (involving cross-examination), rather than application.

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