Submission: Golden Endurance v RMA Watanya

Golden Endurance Shipping SA v RMA Watanya SA [2016] EWHC 2110 (Comm)

An interesting recent judgment of Phillips J in the Commercial Court has clarified the law concerning submission to the jurisdiction of a foreign court.  20 Essex Street’s Michael Collett QC was instructed for the claimant.

The court held that a Moroccan judgment would not be recognised in England because the claimant had not submitted to the jurisdiction of the Moroccan court. Although the claimant had appeared in the Moroccan proceedings, it had done so in order to ask the court to stay the Moroccan proceedings in favour of arbitration and had only engaged with the merits as it was obliged to do so under Moroccan law.

As a result, the claimant ship-owner was not estopped by a Moroccan judgment from asking an English court for a declaration of non-liability for alleged damage to a cargo.

Three aspects of the judgment are of particular interest.

First, Phillips J held that the question of whether or not a party has submitted to the jurisdiction of a foreign court did not an involve an exercise of discretion. Instead, it was a question of mixed law and fact to which there is a single answer.

Secondly, Phillips J dismissed the defendants’ submission that a challenge to the jurisdiction of a foreign court must be a “rational” one in order for a party to benefit from the protection in s.33(1)(b) of the Civil Jurisdiction and Judgments Act 1982. This had been suggested by the authors of Dicey & Morris.

The judge did, however, leave open the possibility that in an extreme case “where a challenge is so obviously absurd (in the context of the applicable foreign law and procedural rules) … the English court might conclude that the party advancing it has in reality submitted”.

Finally, Phillips J held that the the claimant had not committed an abuse of process.  The claimant had begun court proceedings in England but, when in Morocco, had asserted the existence of an arbitration agreement. Phillips J held that it was not inconsistent to argue a point as a matter of foreign law whilst recognising (in parallel proceedings) that it would not succeed as a matter of English law. Further, the judge noted that the claimant had not actually denied the existence of an arbitration agreement in the English proceedings.

The judgment also considered the time-bar under the Hague Rules.