Summary

On the evidence, a claim in respect of the alleged non-performance of a written agreement had a real prospect of success and should proceed to trial. The court had jurisdiction over two of the defendants domiciled outside the English jurisdiction under Council Regulation 44/2001 Art.6(1) and therefore service of the claim form on them was valid. The court also assumed jurisdiction pursuant to CPR r.6.20 over two other defendants on the basis that the claimant had a good arguable case against them.

Facts

The defendant company in the first action (U) applied for summary judgment against the claimant (M) on the basis that his claim in respect of alleged non-performance of an agreement had no real prospect of success. The first defendant in the second action (K) and the defendant companies (C, H and O) applied for orders under CPR Part 11, in respect of M's claim, declaring that the court had no jurisdiction over them and that service of the claim form on them be set aside. K and C were domiciled in Greece and H and O were incorporated in Lebanon. U was incorporated in the United Kingdom. M claimed that, in return for his assistance in obtaining an interest in an oil concession, it was agreed that he would receive a percentage of that interest. The agreement was typed on U's headed notepaper and was signed by M and K, who was at the time a director and authorised signatory of both C and O. The relevant oil interest was initially held by C but was assigned to O. The identity of the party on whose behalf K was acting when he signed the agreement was in dispute. It was common ground that the agreement was made within the jurisdiction for the purposes of CPR r.6.20. The issues for determination were (i) whether there was a real prospect of M succeeding at trial in showing that U was party to the agreement; (ii) whether M was entitled under the Council Regulation 44/2001 to sue C or K in England; (iii) whether there was any serious issue to be tried as between M and H and/or O and whether M was able to establish that England was the appropriate forum for the trial of any claim. U submitted that it was not a party to the agreement with M since it did not own the interest in the concession at the time and that it was not therefore able to transfer any share in the concession to M, that the agreement did not contain any reference to U but referred to C and that K had no authority to contract on its behalf. C and K submitted that neither of the exceptions under Art.5 and Art.6 of the Regulation applied and that Art.2 required that they be sued in Greece. K further submitted that M had not established the necessary good arguable case that K was personally liable under the agreement.

Held

(1) The task of ascertaining the intention of the parties to a commercial contract had to be approached objectively. The question was not what one or other of the parties meant or understood by the words used in the agreement, but "the meaning which the document would convey to a reasonable person having all the background knowledge which would reasonably have been available to the parties in the situation in which they were at the time of the contract", Investors Compensation Scheme Ltd v West Bromwich Building Society (1998) 1 WLR 896 applied. There were a number of material disputes as to what constituted "the background knowledge" and there was a danger if the court proceeded to construe the agreement without first establishing such background knowledge that any resulting construction would be wrong. M had a real prospect of succeeding at trial in showing that U was party to the agreement because the agreement was on its headed notepaper, or alternatively that the agreement was with the group of companies because the group logo was used in the body of the agreement. Accordingly the true construction of the agreement had to await trial. (2) It was plainly expedient to hear and determine both claims in one jurisdiction and the conditions in Art.6(1) of the Regulation had been satisified. M had made out a good arguable case that the court had jurisdiction under Art.6(1) and alternatively under Art.5(1) of the Regulation in relation to K and C. Further, M had established on the evidence that there was a reasonable prospect of success against K and C. Accordingly the applications by K and C failed. (3) The standard to be applied when deciding whether the jurisdiction of the court had been sufficiently established under one or more of the heads of CPR r.6.20 was that of good arguable case. M had a good arguable case against H and O and had a reasonable prospect of success. In light of the conclusions as to the claim against U in the first action and the challenges to the jurisdiction, it was clear that England was the appropriate place to bring the claims against H and O. Accordingly the applications by H and O failed.

Applications refused.