Recent Amendments To English Civil Procedure Help Simplify The Issuance Of Contractual Claims Against Foreign Defendants'Service Of Process Pursuant To CPR 6.33(2B)

• Published date: 29 September 2021
• Subject Matter: Corporate/Commercial Law, Litigation, Mediation & Arbitration, Contracts and Commercial Law, Trials & Appeals & Compensation
• Law Firm: Cadwalader, Wickersham & Taft LLP
• Author: Ms Melis Acuner, Emma Farrow and Gareth Rund

On 6 April 2021, an amendment was introduced to the Civil Procedure Rules 1998 (S.I. 1998/3132) (the 'CPR') at Part 6 concerning service out of the jurisdiction. The change is of interest where at least one or more international businesses/foreign parties (whether EU or non‑EU), otherwise unconnected with the UK, incorporate a choice of court agreement (or 'COCA') in favour of the courts of England & Wales as a means to resolve their contractual disputes. CPR 6.33(2B)(b) now provides that permission of the court is not required to serve out of the jurisdiction a claim where jurisdiction is based on any COCA in favour of the courts of England and Wales. In many cases, this will simplify the procedure for service of international contractual claims on foreign domiciled defendants, by eliminating a preliminary step (i.e. the need to seek permission of the court), which adds cost and delay.

The amendment arises from proposals of the Lord Chancellor's Advisory Committee on Private International Law to reduce unnecessary procedural hurdles after the UK's exit from the EU, in circumstances where the 2005 Hague Choice of Court Convention¹ does not apply (and absent the UK's re-accession to the Lugano Convention).² Though aimed at covering-off the UK's withdrawal from the EU (in respect of which, under the prior regime, it was not necessary to seek the court's permission to serve process on EU domiciled defendants), CPR 6.33(2B)(b) expands the court's automatic jurisdictional reach to include all jurisdictions, regardless of location or affiliation. As such, there is no longer any distinction to be drawn between effecting service upon EU and non‑EU domiciled defendants where there is a COCA in favour of the courts of England & Wales.³

It remains possible, however, for such defendants to challenge the court's jurisdiction at a later stage in the proceedings, for example by disputing the existence of a valid COCA. Such might be the case where there is a question about the existence of the contract in respect of which the claim is made, for instance, if it is alleged that the agreement in question was executed without actual or ostensible authority. In this regard, the case law previously decided under the (now obsolete) head of jurisdiction at para.3.1(6)(d) of Practice Direction 6B will likely remain relevant.⁴ Namely, a good arguable case must be made out that the contract existed.⁵ It is not sufficient to show that, if there is a contract (or a serious issue that there is a contract), it would arguably contain a law and jurisdiction clause.

That case law also established that the impact of a COCA in favour of the courts of England & Wales on claims brought by or against non‑contracting third...