Tort gateway test reviewed by the Supreme Court in the context of injuries abroad

Lady Christine Brownlie v Four Seasons Holdings Inc. [19.12.17]

The Supreme Court held that the English courts had no jurisdiction to hear the claim against the defendant as the claimant was unable to establish that there was a ‘good arguable case’.

Facts

In January 2010, Lady Brownlie and her husband were on holiday in Egypt, staying at the Four Seasons Hotel in Cairo at Nile Plaza.

Prior to her holiday she had telephoned the hotel from England and booked an excursion in a chauffeur driven car. During the excursion, the car crashed and the claimant’s husband, Sir Ian Brownlie, and daughter were killed.

Claim form

The claimant issued a claim against Four Seasons Holdings Inc. (“Holdings”) the holding company of the Four Seasons Hotel Group which is based in Canada.

In order to serve her claim form on Holdings the claimant required permission from the court for service outside England and Wales.

Before permission can be given for service of a claim form outside the jurisdiction it is necessary for the claimant to establish that:

  • The case falls within at least one of the jurisdictional “gateways” in CPR 6B, para 3.1
  • His or her claim has a reasonable prospect of success
  • England and Wales is the proper place in which to bring the claim.

Earlier court decisions

At the first hearing, the Master concluded that the English courts did not have jurisdiction to hear the case against Holdings. His order was reversed by the High Court.

The Court of Appeal concluded that English courts did have jurisdiction to hear the fatal accidents claim but did not for the purposes of Lady Brownlie’s own injury claim or in respect of the 1934 Law Reform Act claim that was being advanced by the claimant. They also agreed that the English courts did have jurisdiction to hear the contract claim.

Supreme Court decision

On appeal the Supreme Court held that the claimant did not meet the longstanding test to establish that there was a “good arguable case” as there was no realistic prospect of establishing that she contracted with Holdings or that they would be held vicariously liable for the negligence of the driver of the excursion vehicle.

As a result, the English courts had no jurisdiction to try the claim against Holdings.

Contract gateway: Place where the contract was concluded.

One of the gateways provided for in Practice Direction 6 is where “a claim is made in respect of a contract where the contract … was made within the jurisdiction” (para 3.1(6)(a)).

The Supreme Court did not rule on the application of the contract gateway test. Lord Sumption accepted that this gateway required an offer and acceptance analysis in accordance with the rules laid down in Entores v Miles Far East [1955]. He did state that the application of these rules to determine whether English courts had jurisdiction over a dispute was not satisfactory. The Supreme Court suggested that the Rules Committee needed to review the rules governing the contract gateway.

Tort gateway test

The Supreme Court, by a majority (3/2) held that consequential loss in England as a result of the accident in Egypt did satisfy the tort gateway test which requires that “damage was sustained … within the jurisdiction”.

Lady Hale accepted the claimant’s argument that “damage” should be interpreted by reference to the ordinary and natural meaning of the word, to include consequential loss. She adopted the approach of the first instance decisions which the Court of Appeal in Brownlie had overruled.

Lord Sumption delivered a powerful dissenting judgment. In his view the gateway test could not be satisfied by consequential loss suffered in England and therefore affirmed the Court of Appeal’s decision on this point, albeit for very different reasons.

In Lord Sumption’s view allowing the claimant to establish jurisdiction on the basis of the consequences of an accident abroad affecting the injured party in their home country would, in his words “produce a test for jurisdiction so wide as to conflict with the purpose of the rule”.

Comment

It is important to note that the Supreme Court’s views on the tort gateway test are not binding. As a result, perhaps surprisingly, the Court of Appeal’s determination on this point in the defendant’s favour that direct damage was required in an injury case to satisfy the gateway test remain undisturbed and will be binding on lower courts.

The case highlights the very differing views of the Supreme Court Justices on the issue of the tort gateway test and this decision may not be the last word on the issue.

Kennedys represented the defendants in this action.