UK Litigation - A Year In Summary

• Published date: 24 December 2021
• Subject Matter: Corporate/Commercial Law, Litigation, Mediation & Arbitration, Corporate and Company Law, Arbitration & Dispute Resolution, Trials & Appeals & Compensation
• Law Firm: Morrison & Foerster LLP
• Author: Mr Chiraag Shah, Shawna Pasquale, Calum Ablett and Sampaguita Tarrant

This year saw the UK grapple with life after Brexit and, along with the rest of the world, the impact of the continued COVID-19 pandemic. As 2021 draws to a close, we round up the key events and developments from the year in UK litigation, arbitration, and business crime, investigations and regulatory spheres.

Litigation

The transition period under the Withdrawal Agreement between the UK and the EU came to an end on 31 December 2020, leaving a somewhat uncertain future for civil judicial co-operation post-Brexit. The Recast Brussels Regulation no longer applies to the UK and, on 28 June 2021, the European Commission refused to provide its consent to the UK's accession to the 2007 Lugano Convention. To recognise and enforce English exclusive jurisdiction clauses (but not an asymmetric or non-exclusive clause) and English judgments, English courts will now have to rely upon the 2005 Hague Convention on Choice of Court Agreements, which the UK re-acceded to in its own right. While the 2019 Hague Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters may provide assistance in the future, it is still in the process of being ratified by the UK, which may take some time.

While there may be some uncertainty around enforcement of English judgments in Europe, the English Supreme Court continued to march forward, handing down a number of seminal decisions covering issues from COVID-19, to human rights, and class actions.

In January, judgment was delivered in FCA v Arch Insurers with the Supreme Court providing guidance on the meaning, effect, and application of common, non-damage business interruption insurance clauses within the context of COVID-19. The Court broadly found in favour of the FCA, holding that the insurers' narrow interpretation of the relevant business interruption clauses was not viable. You can read more about the COVID-19 Business Interruption Insurance Test Case brought by the FCA in our January Client Alert.

On 12 February, the Supreme Court held, in the case of Okpabi v Shell, that the English courts have jurisdiction over claims advanced by a class of Nigerian claimants against Shell, a UK domiciled parent company, concluding that it was at least arguable that Shell UK owed a duty of care to communities affected by oil spills caused by its Nigerian subsidiary. It remains to be seen whether the substantive claim will succeed, but the doors appear to have been partially opened for parent company liability for infringing acts of its subsidiaries based on the principle of "significant control". In a world where business and human rights violations and ESG are taking increasing prominence, the decision underlines the importance of parent company review and scrutiny of its corporate structure and overseas supply chains. For more detail, you can read our commentary on that case.

On 27 April, the Commercial Court dismissed a claim by the Danish tax revenue agency against a number of Defendants who were alleged to have participated in cum-ex transactions that had allegedly cost the Danish treasury to pay out over '1.5 billion in withholding tax refunds - the practice subsequently being declared unlawful. The Court re-affirmed that English courts have no jurisdiction to consider the enforcement of a foreign state's penal, revenue, or other public law in striking out the claim.

On 21 July 2021, the High Court held, in Warren v DSG Retail Ltd, that an individual claimant who sought damages following a data security incident was not able to pursue claims for breach of confidence, misuse of private information, or negligence, finding that the claim had no real prospect of success. You can read our analysis of how this decision might affect the viability of such claims. Read on for an even more important decision in the Data Privacy space below.

Following a Supreme Court decision in December 2020 (see our previous alert), in August the Competition Appeal Tribunal granted the UK's first Collective...