Associate Genevieve Douglas examines disclosure orders in jurisdiction challenges

Associate Genevieve Douglas explores the recent decision in Alesayi v Bank Audi SAL 2024 EWHC 1975 KB, in which it was held that disclosure orders in jurisdiction disputes are not the norm but will be granted by the courts in cases where it is “proportionate and necessary”.

In the recent decision of Alesayi v Bank Audi SAL 2024 EWHC 1975 KB, the High Court made orders for disclosure under CPR 31.12 (specific disclosure) and 31.14 (documents referred to in statements of case and witness evidence) against a defendant bank to determine a jurisdiction challenge.

Background

The claimant is a wealthy Saudi customer of the defendant Lebanese bank. The claimant’s underlying claim is for a mandatory order that the bank transfer more than £23.8 million to accounts in Switzerland. The bank refused to do so due to the impact of the Lebanese liquidity crisis.

The bank argued that an exclusive jurisdiction clause in favour of the courts in Lebanon contained in its contract with the claimant precluded the High Court’s jurisdiction. It denied that it had carried out business or commercial activities in the UK. The claimant relied on publicly available information to challenge the latter assertion and made an application for disclosure against the bank, seeking documents to evidence whetherthe bank had in fact directed commercial or professional activities to the UK.

Decision

On 30 July 2024, the court partially granted the claimant’s disclosure application, notwithstanding that the court may ultimately not have jurisdiction to hear the case.

Master McCloud held that an order for disclosure in jurisdiction challenges is “exceptional” but should be ordered where necessary to do “justice between the parties” and “limited to that which is proportionate”.

The court accepted that disclosure under CPR 31.12 and 31.14 was necessary to determine whether the bank had met the ‘Activities Requirement’ under s.15E(1)(c) of the Civil Jurisdiction and Judgments Act 1982 (“CJJA”) and thus whether the court had jurisdiction to hear the claim under CJJA s.15B(2).

The thrust of Master McCloud’s judgment was the need to ensure a “level playing field” given the “information asymmetry” at play between the parties.

In essence, Master McCloud concluded that the bank, at relatively cheap cost, could prove it never did business in the UK, whilst the claimant only had access to limited information which nonetheless pointed to the possibility that the bank had in fact met the ‘Activities Requirement’ under CJJA s.15E(1)(c).

Take-aways

In this case, the court deemed disclosure to be necessary for the fair resolution of the jurisdiction application, given:

• The “highly asymmetric evidential position” between the parties;
• The relatively low cost of disclosure compared to the value of the claim; and,
• The fact that the material intended for disclosure was likely to be highly conclusive to the jurisdiction issue.

The judgment confirms that the courts will be reluctant but not constrained in all cases in exercising their coercive powers before jurisdiction is established.

Key considerations in jurisdictional disclosure applications include equality of arms, the cost of disclosure relative to the claim’s value, and proportionality. A relatively ‘light touch’ approach will be taken to the evidence in such applications.

The full judgment can be found here.