A recent High Court decision involved consideration of whether the court properly had jurisdiction to hear a case based on the principles of the EU Brussels I Regulation (44/2001). While the decision does not establish any novel principle, it is a useful restatement of a generally understood position.
In Coleman v Offley Insurance Services Limited(1) the defendant, an insurance broking firm registered in the United Kingdom, brought a motion seeking an order to set aside service of proceedings and/or to strike out the summons on the basis that the Irish court did not have jurisdiction to hear and determine the plaintiffs' claims under the Brussels I Regulation. In the summons, the plaintiffs sought damages for "breach of contract, negligence, breach of duty (including breach of statutory duty and breach of fiduciary duty)" and "a declaration that [they] are entitled to an indemnity from the defendant".
Although no further details of the claim appeared in the summons, the summons did contain an endorsement to the effect that:
"The Court has power under Council Regulation (EC) No. 44/2001 of 22 December 2000 to hear and determine the plaintiff's' claims and the Court shall assume jurisdiction to hear the said claim under the provisions of Article 5(1), Article 5(3) of the Regulation."
The endorsement effectively tried to cover two bases, in that Article 5(1) provides for jurisdiction in matters relating to a contract in the courts for the place of performance of the obligation in question, while Article 5(3) provides for matters of tort that jurisdiction arises in the courts where the harmful event occurred.
The defendant had acted as an insurance broker for the plaintiffs in respect of various types of insurance since the 1990s. The first two plaintiffs purchased a house in County Dublin, but continued to reside in England and took out unoccupied buildings insurance which was placed through the defendant's brokerage. Subsequently, building works had to be carried out; despite initial difficulties, those works were covered through insurance obtained through the defendant from August 2 2001 and renewed until February 14 2003, when the building works were substantially completed. From February 2004 the plaintiffs organised their own insurance for the property.
However, by January 2005 the adjoining owner to the property commenced proceedings arising out of the works, alleging damage to his property from the plaintiffs' building works, as well as distress suffered as a consequence. The defendant was advised of the claim in May 2005 and said that he was instructed to obtain the necessary information about the claim from the plaintiffs' solicitor so that the claim could be notified to the insurer. The plaintiffs alleged that following their request to notify the insurer of the claim, the defendant either failed to do so or failed to do so adequately, leading to the loss suffered by them, and claimed from the defendant as part of the proceedings.
The question for determination was whether the plaintiffs' claim was a freestanding claim in tort (negligence), or whether it was founded in contract or in respect of a tort relating to a contract. At the outset, Judge Peart acknowledged that if the latter were the case, the proper place for performance of the contract in question would be the United Kingdom and the courts there properly should have jurisdiction. Conversely, if the claim were simply a freestanding claim in tort only, then the Irish court had jurisdiction on the basis of Article 5(3).
On the facts, and having considered affidavit evidence and heard submissions from both sides, the court was satisfied that the claim was a claim in tort only and that it stood free of, and unrelated to, any contractual claim. It found that each time the plaintiffs sought that the defendant put in place a contract of insurance, a contract was entered into and was fulfilled upon the issue of the relevant contract by the insurer. Moreover, there was no suggestion that the policy of insurance put in place by the defendant was other than what the plaintiffs had instructed him to do.
The court noted that the claim being made here was that after the plaintiffs had informed the defendant of a claim by their neighbour, the defendant had failed to notify or properly notify the insurer. However, under the insurance policy that obligation fell on the plaintiffs and the defendant had no contractual duty to do so. Insofar as the defendant may have been asked to notify the insurers and have taken on such responsibility and failed to do so, it is arguable that he owed a duty of care. If he was negligent in that regard and the loss suffered as a consequence were foreseeable, then he could be liable to the plaintiffs in negligence.
Therefore, the court concluded that the only claim that the plaintiffs could be said to have against the defendant arising from the circumstances put before it was under the broad head of negligence. The court suggested that this was premised on the basis of a relationship of proximity between the parties, the assumption of a duty of care by the defendant to notify the insurer and an alleged breach of that duty by failing to do so, along with foreseeable loss arising therefrom.(2)
Thus, the court felt this was a classic tort claim in negligence and that it came within Article 5(3). Consequently, the defendant's motion would be struck out, but the plaintiff's pleadings would need to be revised to confine the claim advanced to a claim in tort.
As identified above, this decision does not establish any novel principle of law. Notwithstanding that no new principle of law is involved, it does show that the Irish courts will adopt a straightforward and sensible construction of the jurisdiction provisions thereof, which should give parties certainty that Irish courts will determine jurisdiction in accordance with the relatively clear provisions of the Brussels I Regulation.