Parallel proceedings under Lugano and Brussels Recast

Although Brussels Recast no longer applies to proceedings initiated in the UK from 1 January 2021, the English courts have remained busy with issues relating to the application of the Regulation to proceedings initiated before that date:

• The Court of Appeal has held that an asymmetric jurisdiction clause conferring exclusive jurisdiction upon the English courts in relation to proceedings initiated by one party only was exclusive for purposes of Art.31(2) of Brussels Recast (Etihad v Flother [2020] EWCA Civ 1707).  Art.31(2) provides that where proceedings are commenced in one EU member state in accordance with an exclusive jurisdiction clause (EJC), any proceedings subsequently brought in another member state under the same clause must be stayed until the first court declares it has no jurisdiction.  In obiter remarks, the Court also indicated that asymmetric jurisdiction clauses are unlikely to fall under the Hague Convention, which continues to apply in the UK in relation to EJCs following the end of the Brexit transition period.

• In Lopesan Touristik SA v Apollo European Principal Finance Fund III (Dollar A) LP [2020] EWHC 2642 (Comm), the Court dismissed an application under Art.30(1) of Brussels Recast for a stay of proceedings, which had been commenced in England pursuant to an EJC, pending the determination of related proceedings in Spain brought under a conflicting EJC.  The decision emphasised that where a claim is commenced in accordance with an EJC, and the related claims cannot be heard together due to conflicting EJCs, very strong factors are required to justify a stay.

• In Município de Mariana v BHP Group plc [2020] EWHC 2930 (TCC), English claims were struck out as an abuse of process where parallel proceedings were underway in Brazil. The case emphasises that the courts are more likely to strike out claims as abusive where the claimant has already taken (or foregone) the opportunity to bring their claim in other proceedings.

Recent cases have also clarified the scope of the Lugano Convention, which (like Brussels Recast) continues to apply in the UK to proceedings commenced before the end of the Brexit transition period.  If the UK rejoins Lugano, this case law will also remain relevant to ongoing cases brought after the UK's accession becomes effective.

• In Wright v Granath[2021] EWCA Civ 28, the Court of Appeal clarified the scope of Art.27 of Lugano, which states that where proceedings involving the same cause of action and between the same parties are brought in different member states, any court other than the court first seised must stay its proceedings until the first court establishes jurisdiction.  In particular, the Court confirmed that Art.27 should be narrowly construed and found that two claims brought in different Lugano member states did not have the same cause of action because one of them included an additional legal element. 

• In Public Institution for Social Security v Al Rajaan[2020] EWHC 2979 (Comm), the Court held that a claimant who was required to sue a defendant in an overseas jurisdiction under Art.23 Lugano in relation to some claims, because of an EJC, could not seek to pursue connected claims in England against the same or another defendant under Art.6 Lugano, which permits co-defendants to be sued in the state where only one of them is domiciled provided that the claims are sufficiently closely connected.  Among other things, allowing the outcome pursued by the claimant would be contrary to the justification for assuming jurisdiction under Art. 6, which was the desirability of avoiding concurrent proceedings and irreconcilable judgments in different states.

See our parallel proceedings microsite for further insight into the issues that arise when an incident leads to multiple legal proceedings and/or enforcement actions.