NIX V EMERDATA LTD AND ANOTHER [2022] EWHC 718 (COMM)

HEADLINE SUMMARY

The Commercial Court held that it did not have jurisdiction to grant permission to serve a disclosure application outside the jurisdiction on a foreign non-party. 

COMMENTARY

This decision shows that you can't get disclosure from a non- party outside the jurisdiction using the gateway in CPR 6B PD 3.1 (20), which relates to claims made "under an enactment"; an application notice is not a "claim". The letters of request regime is instead the "proper, courteous, respectful method of obtaining evidence within a foreign jurisdiction from a foreign party". 

FACTUAL BACKGROUND AND DECISION

This case related to the collapse of a now insolvent company. The defendant (E) is the company that purchased the now insolvent company and the claimant (N) was the CEO of the insolvent company, until his suspension in March 2018. 

E issued an application for non-party disclosure against the respondent (S), a New York law firm that advised it at key points during the events in dispute, and sought permission to serve the application notice in New York. It sought to establish what communications had passed between S and N. The judge dismissed the application both on paper and at the subsequent oral hearing. 

The judge pointed to the fact that the court is cautious in allowing processes to be served on a foreigner outside England and questioned why a partnership based in the US, that had no residence in England, should be susceptible to the English court's order. 

E argued that gateway 20(a) of paragraph 3.1, PD 6B should be available for applications made under an enactment by means of an application notice, rather than a claim form; that sub paragraph provides that where a claim is made under an enactment which allows proceedings to be brought, and those proceedings are not covered by any of the other grounds referred to in PD 6B, a claim form may be served outside the jurisdiction with the court's permission.  

KEY LEGAL POINTS

This judgment highlights that the court will not look favourably on attempts to circumvent the letters of request regime. It will only exercise a discretion to order an outgoing letter of request when it would accept a parallel request from a foreign jurisdiction inwards. 

The attempt to serve a disclosure application on an entity that is outside the jurisdiction wasn’t appropriate on the facts and CPR 6.39 (service of an application on a non- party) was not intended to be used in the way in which the N tried to use it. 

The CPRC has approved changes to the gateways under CPR PD 6B that will come into force in October 2022, (but which have not yet been published), which expressly provide a gateway under which the court may give permission for two specific types of non- party disclosure applications (Norwich Pharmacal Orders and Bankers Trust Orders) to be served outside the jurisdiction.

Key Contact

Shaun Marshall