Living with Multi-Jurisdictional Litigation

by Christopher Richter1

"Trial occurs locally. A case is heard before a judge at a local Court house, and decided by what goes on before him. The procedure (and often the substantive law) is governed by local law and practice. Although the collection of evidence may take place across boundaries, the goal is to bring that proof home to be heard at trial."

This is an attitude often adopted by litigators presented with a case which has international scope. It is a dangerous attitude because the presence of extra-jurisdictional elements can change almost any or every aspect of a dispute: from the legal rules to be applied, to the proof which may be available. Like a juggler who suddenly has twice as many balls in the air, the attorney confronted with a multi-jurisdictional dispute has much on his mind.

Parallel proceedings offer the most stark example of how drastically the normal rules may change when a dispute exceeds the boundaries of one jurisdiction -- now there is not one Court deciding the dispute, but competing jurisdictions. Ignoring the presence of the competing jurisdiction may result in irreparable damage to the client's claim both at home and in the competing jurisdiction. It is therefor crucial that the attorney and client understand the implications of the cross-border nature of the dispute.

In my limited time, I would like to give several examples of parallel proceedings which have been considered by the Courts. These examples are chosen to demonstrate the different factual and procedural contexts within which multi-jurisdictional litigation may be fought, and the reactions of the Courts, attorneys and clients to these situations.

Lis alibi pendens

The most obvious situation of parallel proceedings is where the same person is trying to sue the same defendant for the same reason in two or more different jurisdictions. This is the case of the poorly organized plaintiff. While it may appear wise of the plaintiff to hedge his bets by bringing actions in each possible jurisdiction, there are no guarantees of success. The defendant may succeed in contesting jurisdiction on the basis of the doctrine of lis alibi pendens, which states generally that the Court may suspend or dismiss an action where another action is pending in a foreign jurisdiction between the same parties and in respect of the same subject matter.2 But challenges to jurisdiction are not the only risk arising from instituting actions in multiple jurisdictions.

Risk also arises because the plaintiff attorns to the jurisdiction in which he commences each of the actions. It may be impossible for the plaintiff to suspend proceedings in one jurisdiction in favour of another if the defendant insists on pressing forward in the jurisdiction most favourable to it.3 In cases where the proceedings are advanced and the defendant has also attorned to the jurisdiction, the plaintiff may be said to have renounced his right to commence proceedings in any other forum. In such cases, the local forum may be willing to issue an anti-suit injunction to prevent the plaintiff from pursuing the foreign proceedings.4

The simple solution to this problem is to avoid instituting multiple actions by thoroughly investigating the issue of jurisdiction before commencing the first action. After weighing the relative advantages of each jurisdiction, it may still be prudent to preserve jurisdiction in an uncontested, but less favourable, forum (due to a statute of limitations problem, for example) while establishing jurisdiction in another, contested but more favourable, jurisdiction.

Counter claims in competing jurisdictions

The above is a simple example of lis alibi pendens. The situation becomes more complicated where it is not the same party who is plaintiff in both jurisdictions, but rather each party has commenced an action in a...