The Recast Brussels Regulation (the Regulation) and the Lugano Convention (the Convention) contain rules about when a court or tribunal in Great Britain can hear a claim brought against someone who is not domiciled here. Two recent cases have explored how and when the rules apply.
Bosworth v Arcadia Petroleum Limited involved a claim of unlawful means conspiracy and breach of fiduciary duty against the former CEO and CFO of the Arcadia Group. Both defendants were domiciled in Switzerland and had contracts of employment with Arcadia Group companies. They argued that because of this, the High Court did not have jurisdiction to hear the claims against them. Under Article 20 of the Convention, in matters relating to individual contracts of employment, an employer is only entitled to bring proceedings against an employee in the courts of the country where he or she is domiciled.
The Supreme Court referred the case to the CJEU, which found that the defendants were not employees within the meaning of the Convention. To be an employee, there must be a relationship of subordination between the worker and his employer. On the facts of this case there was no such relationship. The CEO and CFO had control over the day to day operation of the business and had drafted their own contracts of employment. The fact that the shareholders of Arcadia Group had power to "hire and fire" them did not imply subordination. As the directors did not have "individual contracts of employment", the Convention protection against being sued outside the country of domicile did not apply.
Ravisy v Simmons & Simmons LLP involved a situation in which a former partner based in France brought tribunal proceedings in Great Britain against a UK based law firm and one of its partners, who was also domiciled in France. Under the Regulation, an employee can sue an employer either in the state where the employer is domiciled, or in the courts of the state where the employee habitually worked. It was conceded that the claimant was an employee for the purposes of the Regulation and that the tribunal had jurisdiction as a matter of international law to hear the claim against the firm.
In relation to the individual respondent, an individual domiciled in a member state should normally be sued in that state. However, if they are one of a number of defendants, Article 8 provides that the individual can be sued where a co-defendant is domiciled, if the claims are closely connected so that it is expedient to hear them together to avoid the risk of irreconcilable judgments from separate proceedings. The question for the EAT was whether the tribunal had jurisdiction in principle to hear the claim against the partner based in France, or whether he could only be sued in France.
The EAT found that the tribunal did have jurisdiction in those circumstances. It was irrelevant that the claimant had brought two separate claims, one against the law firm and one against the individual partner. On a common sense reading of Article 8 it applied where defendants are both parties to claims raising the same issues in the same factual matrix, irrespective of procedural technicalities. However, on the facts of the case, the claimant had not shown a sufficient connection with Great Britain and British employment law for her claim to proceed.