Jurisdiction and service out from 1 January 2021: (mostly) back to the usual common law rules

Now that the dust has settled, Kristina Lukacova of Monckton Chambers summarises the position in relation to jurisdiction and service out, including in relation to consumer/employment contracts within the scope of the new sections 15A-E of the Civil Jurisdiction and Judgments Act 1982.

Jurisdiction: back to the common law rules

The Brussels Regulation (recast) has been revoked (Reg. 89 of The Civil Jurisdiction and Judgments (Amendment) (EU Exit) Regulations 2019).

However, it will continue to apply to claims issued before the end of the transition period (Reg. 92(1)(a) of The Civil Jurisdiction and Judgments (Amendment) (EU Exit) Regulations 2019).

As to claims issued after 31 December 2020, the usual common law rules apply, subject to exceptions in relation to:

• exclusive choice of court agreements within the scope of the 2005 Hague Convention on Choice of Court Agreements (“the 2005 Hague Convention”), to which the UK has now acceded in its own right (but note the exclusions in Article 2); and

• claims within the scope of the new sections 15A – 15E of the Civil Jurisdiction and Judgments Act 1982 (“CJJA 1982”) in relation to consumer and employment contracts, discussed below.

Jurisdiction: consumer contracts  

Section 15B CJJA 1982 applies to matters relating to a consumer contract where the consumer is domiciled in the UK.

Replicating the principles in Article 18 of the Brussels Regulation (recast), under section 15B(2) CJJA 1982, the consumer may bring proceedings against the other party to the contract (i) where the other party is domiciled in the UK, in the courts of the part of the UK where the other party is domiciled, or (ii) in the courts of the place where the consumer is domiciled, regardless of the domicile of the other party.

On the other hand, proceedings against the consumer may only be brought in the courts of the part of the UK where the consumer is domiciled (section 15B(3) CJJA 1982).

Replicating Article 19 of the Brussels Regulation (recast), pursuant to section 15B(6) CJJA 1982, the above rules may only be departed from by an agreement (i) which is entered into after the dispute has arisen, (ii) which allows the consumer to bring proceedings in courts other than those indicated in section 15B, or (iii) which confers jurisdiction on the courts of the part of the UK where both the consumer and the other party are domiciled or habitually resident at the time of conclusion of the contract.  

Jurisdiction: employment contracts

Section 15C CJJA 1982 applies to matters relating to individual contracts of employment.

Replicating the provisions in Article 21(1) of the Brussels Regulation (recast), section 15C(2) CJJA 1982 provides that the employer may be sued by the employee:

• where the employer is domiciled in the UK, in the courts of the part of the UK where the employer is domiciled;

• in the courts of the place in the UK where or from where the employee habitually carries out the employee’s work or last did so, regardless of the domicile of the employer; or

• if the employee does not or did not habitually carry out work in any one part of the UK or any one overseas country, in the courts of the place in the UK where the business which engaged the employee is or was located, regardless of the domicile of the employer.

On the other hand, if the employee is domiciled in the UK, the employer may only sue the employee in the part of the UK where the employee is domiciled (section 15C(3) CJJA 1982).

Replicating the provisions in Article 23 of the Brussels Regulation (recast), section 15C(6) CJJA 1982 provides that the above rules may only be departed from by an agreement which (i) is entered into after the dispute has arisen, or (ii) allows the employee to bring proceedings in courts other than those indicated in section 15C. 

Service out: back to seeking permission

As to any claims issued after 31 December 2020, the claimant needs permission to serve a claim form out of the UK pursuant to CPR r.6.36 unless:

• sections 15A-E CJJA 1982 apply and there are no pending proceedings between the parties concerning the same claim in the courts of any other part of the UK (CPR r.6.33(2)); or

• the 2005 Hague Convention applies (CPR r.6.33(2B)).

Unless one of the above exceptions applies, the claimant must apply for permission to serve the claim form out of the jurisdiction and satisfy the court that:

• there is a good arguable case that the claim falls within or more of the grounds of jurisdiction under paragraph 3.1 of Practice Direction 6B;

• there is a serious issue to be tried on the merits of the case; and

• in all the circumstances, England is clearly or distinctly the appropriate forum for the trial of the dispute, and the court ought to exercise its discretion to permit service of the proceedings out of the jurisdiction.

As to any claims issued (but not served) before 1 January 2021, a recently introduced savings provision provides that the old rules on service out continue to apply (Reg. 9(3) of The Civil, Criminal and Family Justice (Amendment) (EU Exit) Regulations 2020). To the extent that such claims fall under Brussels Regulation (recast), they can therefore be served out of the UK without permission under the old version of CPR r.6.33(2).

Choice of court agreements in favour of the courts of England & Wales

At a meeting held on Friday 9^th October 2020, the Civil Procedure Rule Committee agreed that the rules in relation to service out should be amended so that permission is not required where a claimant is seeking to rely upon an England & Wales choice of court agreement where the 2005 Hague Convention does not apply. The approved minutes of the meeting are available here.  

The Lord Chancellor’s Advisory Committee on Private International Law proposed to remove gateway 3.1(6)(d) from Practice Direction 6B, and to introduce a new rule, 6.33(2C), allowing service out without permission of the court where the claimant relies upon a choice of court agreement in favour of the courts of England & Wales. The proposed changes were agreed, subject to final drafting, and are expected to be implemented in due course. 

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