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Litigation & Dispute Resolution - Appleby

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<strong>Litigation</strong> & <strong>Dispute</strong> <strong>Resolution</strong><br />

First Edition<br />

Contributing Editor: Michael Madden<br />

Published by Global Legal Group


CONTENTS<br />

Preface<br />

Michael Madden, Winston & Strawn London<br />

Australia Martin Garrett & Matthew Eglezos, Freehills 1<br />

Belgium Koen Van den Broeck & Thales Mertens, Allen & Overy LLP 14<br />

Bermuda Kiernan Bell & Martin Ouwehand, <strong>Appleby</strong> (Bermuda) Ltd. 19<br />

BVI Andrew Willins, <strong>Appleby</strong> 26<br />

Bulgaria Assen Georgiev, CMS Cameron McKenna LLP - Bulgaria Branch 37<br />

Cayman Islands Tony Heaver-Wren & Shaun Tracey, <strong>Appleby</strong> (Cayman) Ltd. 44<br />

China Hongji Li & Jie Ma, Commerce & Finance Law Offi ces 59<br />

Costa Rica Róger Guevara & Abraham Balzer, Batalla Abogados 64<br />

Cyprus Nicos G. Papaefstathiou & Maria Papaefstathiou, Tassos Papadopoulos & Associates LLC 68<br />

Ecuador Jorge Sicouret Lynch, César Sánchez Icaza & Gabriela Lecaro Malnati, Coronel & Pérez 76<br />

England & Wales Michael Madden & Bryn Dodson, Winston & Strawn London 85<br />

Estonia Pirkka-Marja Põldvere, Aivar Pilv Law Office 100<br />

France Denis Chemla & Erwan Poisson, Allen & Overy LLP 110<br />

Germany Jörg Staudenmayer & Judith Walz, CBM International Lawyers LLP 120<br />

Guernsey Jeremy Le Tissier & Adam Cole, <strong>Appleby</strong> 127<br />

Hong Kong Giovanna Kwong, SJ Berwin LLP 133<br />

India M. Dhyan Chinnappa & M.V. Sundararaman, CrestLaw Partners 141<br />

Indonesia Kartini Muljadi, Kartini Muljadi & Rekan 148<br />

Isle of Man Chris Cope, Elizabeth Simpson & Gillian Duffy, <strong>Appleby</strong> (IOM) LLC 157<br />

Italy Ferdinando Emanuele & Milo Molfa, Cleary Gottlieb Steen & Hamilton LLP 170<br />

Japan Yoshio Otani, Junya Naito & Tsuyoshi Suzuki, Momo-o, Matsuo & Namba 180<br />

Jersey Fraser Robertson & Davida Blackmore, <strong>Appleby</strong> 189<br />

Malaysia Tiang Joo Su, Cheah Teh & Su 199<br />

Mexico<br />

Miguel Angel Hernandez Romo Valencia & Miguel Angel Hernandez Romo,<br />

Bufete Hernandez Romo 209<br />

Netherlands Marius Josephus Jitta & Damiën F. Berkhout, Stibbe 215<br />

Nigeria Kolawole Mayomi & Debo Ogunmuyiwa, SPA Ajibade & Co. 224<br />

Spain Álvaro López de Argumedo & Juliana de Ureña, Uría Menéndez 235<br />

Switzerland Balz Gross, Claudio Bazzani & Julian Schwaller, Homburger 243<br />

Turkey Gönenç Gürkaynak, İlay Yılmaz & Gözde Kitapcı, ELIG Attorneys at Law 252<br />

Ukraine<br />

Andrey Astapov, Oleh Beketov & Oleksiy Zorin,<br />

AstapovLawyers International Law Group 260<br />

USA Kapil Longani & Gunjan Sharma, Skadden, Arps, Slate, Meagher & Flom LLP 270


Guernsey<br />

Jeremy Le Tissier & Adam Cole<br />

<strong>Appleby</strong><br />

Efficiency/integrity<br />

Whilst much of Guernsey’s Royal Court procedure is generally based on principles which are similar<br />

to those adopted in England, it is important to note that Guernsey is a separate jurisdiction with its<br />

own specific laws and rules. Guernsey Royal Court procedure is an adversarial process which takes<br />

place before a single judge 1 . The judge determines all issues of procedure and law, whilst issues of<br />

fact are usually determined by Jurats 2 who will sit with the judge. However, in certain circumstances<br />

issues of fact may also be determined by the judge alone. Only Guernsey Advocates are permitted<br />

rights of audience before the Royal Court.<br />

The Royal Court in Guernsey has unlimited jurisdiction in both civil and criminal disputes. The<br />

Magistrate’s Court has jurisdiction to determine more minor criminal matters and civil disputes of<br />

under £10,000.<br />

In respect of civil disputes, the Guernsey Courts have seen an increase in work over the past years<br />

but Court accommodation has also been increased, particularly with a major extension to the Royal<br />

Court buildings in 2005, in order to provide increased capacity for the increased levels of work. In<br />

addition to the judges based in Guernsey, there are also a number of part-time judges who are either<br />

senior English lawyers or members (or former members) of the English judiciary who sit to determine<br />

matters in the Royal Court. A Guernsey judge (whether full time or part time) will not customarily<br />

undertake any Guernsey legal or quasi-legal work save in their official capacity. Where a member of<br />

the Guernsey judiciary perceives that they have a conflict or potential conflict of interest in a matter<br />

to be determined he/she may voluntarily recuse themselves or any of the parties to the litigation may<br />

apply to recuse the judge.<br />

The Guernsey Royal Court is aware of and actively encourages alternate forms of dispute resolution.<br />

Arbitration in Guernsey is governed by the Arbitration (Guernsey) Law, 1982 which provides for,<br />

among other things, the stay of Royal Court proceedings in favour of arbitration. Mediation is another<br />

frequently used method of alternative dispute resolution with both locally based mediators and<br />

mediators from other jurisdictions being used regularly. Other forms of alternate dispute resolution<br />

used include determinations by independent expert and adjudication. Guernsey also has statutory<br />

tribunals for the determination of certain types of dispute, such as the Employment and Discrimination<br />

Tribunal.<br />

Enforcement of judgments/awards<br />

Foreign judgments may be enforced in Guernsey in one of two different manners, either under The<br />

Judgments (Reciprocal Enforcement) (Guernsey) Law, 1957 or at common law.<br />

In order for a foreign judgment to be enforced under the Judgments (Reciprocal Enforcement)<br />

(Guernsey) Law, 1957 the judgment must have been obtained from a superior Court of the following<br />

countries: England and Wales; Scotland; Northern Ireland; the Isle of Man; Israel; the Netherlands;<br />

the Netherlands Antilles; the Republic of Italy; Surinam; or Jersey. Where a judgment is from a Court<br />

other than those set out above, the judgment must be enforced at common law.<br />

GLI - <strong>Litigation</strong> & <strong>Dispute</strong> <strong>Resolution</strong> First Edition 127 www.globallegalinsights.com<br />

© Published and reproduced with kind permission by Global Legal Group Ltd, London


<strong>Appleby</strong><br />

Guernsey<br />

The Judgments (Reciprocal Enforcement) (Guernsey) Law, 1957 sets out a procedure for the<br />

registration and enforcement of a foreign judgment in order for it to be enforceable as if it was a<br />

judgment of the Guernsey Royal Court. There are a certain number of reasons which can mean that a<br />

foreign judgment which is being sought to be enforced under the Judgment (Reciprocal Enforcement)<br />

(Guernsey) Law, 1957 may not be enforced in Guernsey and these may include instances where the<br />

original Court did not have jurisdiction to determine the dispute, where the judgment was obtained by<br />

fraud and where enforcement would be contrary to public policy in Guernsey.<br />

Where a foreign judgment is sought to be enforced at common law, the party seeking to enforce the<br />

judgment will issue proceedings in Guernsey relying on the foreign judgment in order to obtain an<br />

equivalent judgment from the Royal Court which may then be enforced. If a defendant was to seek<br />

to defend the Guernsey proceedings, the Plaintiff would usually seek summary judgment based on the<br />

fact that the foreign judgment had already been obtained and the doctrine of res judicata.<br />

Arbitrations awards, both domestic and foreign, may be enforced by the Guernsey Royal Court under<br />

the provisions of the Arbitration (Guernsey) Law, 1982.<br />

The most common method of enforcement of a judgment of the Royal Court in Guernsey is to provide<br />

the Act of Court recording the judgment to Her Majesty’s Sheriff who is then able to seize assets in<br />

satisfaction of the judgment.<br />

Privilege and disclosure<br />

It is usual for parties to litigation to agree or be ordered to provide disclosure of relevant documents<br />

as part of the litigation procedure. There are two general forms of disclosure, standard disclosure and<br />

specific disclosure. When giving standard disclosure, a party will have to disclose all documents on<br />

which it relies as well as any other documents which adversely affect its own case, any documents<br />

which adversely affect another party’s case and any documents which support another party’s case<br />

(as well as any other documents the parties may be obliged to disclose under any practice direction).<br />

A document is defined as ‘anything in which information of any description is recorded’. This will<br />

include anything which is held electronically (such as emails, electronic documents, calendars,<br />

scanned images etc.) and other information which may be retained in a form which is other than in<br />

hard copy form (such as voicemail messages or anything recorded on microfiche).<br />

In addition, the obligation to disclose documents refers to documents which are in a party’s control,<br />

or which have been in its control. This includes documents which are or have been in the party’s<br />

physical possession, documents which the party has, or has had, the right to possess and documents<br />

which the party has, or has had, a right to inspect or take copies of.<br />

Documents will be privileged from disclosure where they either attract legal advice privilege or<br />

litigation privilege.<br />

With extremely limited exceptions (e.g. cases of personal injury or death), it is not possible to obtain<br />

pre-action disclosure of documents, nor is it possible to obtain orders for disclosure of documents<br />

from third parties as part of the disclosure process. However, there may be other forms of relief<br />

available from the Court in the appropriate circumstances which will entail the Court ordering such<br />

disclosure of documentation (for instance as part of the ancillary relief comprised within a freezing<br />

order, or a Bankers Trust order).<br />

Whilst there are not yet any practice directions or rules of Court relating to electronic disclosure, the<br />

use of electronic disclosure is becoming more common and this is likely to continue.<br />

Costs and funding<br />

Whilst there are no absolute rules relating to costs as they are within the Court’s discretion, the normal<br />

manner in which the Court will exercise its discretion when awarding costs is for the successful party<br />

to have its costs paid by the unsuccessful party.<br />

There are two general bases for the award of costs, being either the standard basis or the indemnity<br />

basis. Costs ordered on the standard basis are, unless the Court orders otherwise, capped at a rate<br />

GLI - <strong>Litigation</strong> & <strong>Dispute</strong> <strong>Resolution</strong> First Edition 128 www.globallegalinsights.com<br />

© Published and reproduced with kind permission by Global Legal Group Ltd, London


<strong>Appleby</strong><br />

Guernsey<br />

of £227 per hour for Advocates (with corresponding reductions for non-advocate lawyers) which is<br />

likely to be lower than the cost actually charged by the Advocates. The paying party is able to seek a<br />

taxation of costs. Where there is a dispute over the reasonableness of costs incurred on the standard<br />

basis, the presumption is that costs will be resolved in favour of the paying party.<br />

Where parties have engaged English solicitors and barristers to assist in proceedings, those costs are<br />

generally irrecoverable, save in appropriate and exceptional cases.<br />

Where costs are ordered on the indemnity basis, the presumption is reversed so that presumptions are<br />

resolved in favour of the receiving party.<br />

It is possible for the Court to change the recoverable hourly rate so that an increased rate of recovery<br />

can be obtained.<br />

It is not possible for Advocates to enter into contingency fee arrangements. In certain circumstances,<br />

funding for litigation may be available where such funding is not champertous or constitutes unlawful<br />

maintenance.<br />

Interim relief<br />

The Guernsey Royal Court is able to, and does, grant interim relief where justified, with jurisdiction<br />

being available to grant commonly recognised forms of interim relief such as freezing orders and<br />

search orders.<br />

When granting interim relief, the Royal Court will view developments in England and Wales as well<br />

as in other comparable common law jurisdictions, particularly Jersey, as persuasive in the absence<br />

of directly applicable local decisions. Accordingly, where appropriate, ex-parte relief is available.<br />

The Royal Court is also able to, and will, grant injunctions in support of foreign proceedings without<br />

requiring substantive proceedings to be issued locally, such as where the only connection to the<br />

proceedings is the presence of assets within the jurisdiction of the Royal Court.<br />

Other forms of interim relief are available, many of which will be recognisable to lawyers in common<br />

law jurisdictions, such as Bankers Trust Orders and Anti-Suit Injunctions, as well as other forms<br />

of interim relief which are rarely seen outside of Guernsey. The first of such is the Clameur de<br />

Haro which effectively operates as an injunction which a landowner may obtain prohibiting the<br />

interference with his real property without the immediate need to obtain such an order from the Royal<br />

Court. However, once the ‘Clameur’ has been raised 3 , the landowner is required to promptly register<br />

it with the Royal Court. Whilst it does appear to be a particularly informal method of obtaining<br />

such relief, it is rarely used and there is little doubt that abuse of the procedure would be seriously<br />

criticised by the Royal Court. Another form of interim relief available which is practically unknown<br />

outside of Guernsey is the ability of a plaintiff to make an ex-parte application to register the amount<br />

claimed against a defendant as a charge against any real property he may own on the island. The<br />

plaintiff has to demonstrate a prima facie case and the Court will grant the application, permitting<br />

the plaintiff to register the charge against the property, effectively obtaining security for the amount<br />

being claimed.<br />

As a general rule, the Guernsey Royal Court will be willing to provide assistance in respect of foreign<br />

proceedings by granting interim relief so long as the assistance and relief is sought in the appropriate<br />

circumstances and with the appropriate safeguards, such as undertakings, being provided.<br />

International arbitration<br />

Guernsey is a party to the New York Convention. The United Kingdom extended the territorial<br />

application of the Convention to Guernsey on 19 April 1985. Enforcement of Convention awards<br />

was incorporated in domestic Guernsey law by the Arbitration (Guernsey) Law, 1982 which came into<br />

force on 11 April 1983. The Arbitration (Guernsey) Law, 1982 also provides for the enforcement of<br />

awards by parties to the Convention on the Execution of Foreign Arbitral Awards signed at Geneva on<br />

16 September 1927 (the Geneva Convention) and the Protocol on Arbitration Clauses of 24 September<br />

1923. The convention on the settlement of investment disputes between States and Nationals of<br />

other States signed in Washington on 18 March 1965 (the Washington Convention) has also been<br />

GLI - <strong>Litigation</strong> & <strong>Dispute</strong> <strong>Resolution</strong> First Edition 129 www.globallegalinsights.com<br />

© Published and reproduced with kind permission by Global Legal Group Ltd, London


<strong>Appleby</strong><br />

Guernsey<br />

implemented in Guernsey under an extension of the Arbitration (International Investment <strong>Dispute</strong>s)<br />

Act 1966.<br />

The primary source of domestic arbitration law in Guernsey is statutory, being the Arbitration<br />

(Guernsey) Law, 1982. This law deals with both domestic arbitration proceedings as well as the<br />

enforcement of certain foreign arbitration awards. In addition, the (English) Arbitration (International<br />

Investment <strong>Dispute</strong>s) Act 1966 has been incorporated into domestic Guernsey law by the Arbitration<br />

(International Investment <strong>Dispute</strong>s) (Guernsey) Order 1968.<br />

There are provisions within the Arbitration (Guernsey) Law, 1982 which permit a party to apply to the<br />

Royal Court for a stay of Court proceedings where there is an agreement to arbitrate a dispute between<br />

the parties. Such an application must be made before the party delivers pleadings or takes any other<br />

steps in the Court proceedings.<br />

A domestic arbitration award will be enforced in the same manner as a Royal Court judgment.<br />

However, leave of the Court must first be sought in order to enforce it in such a manner. Foreign<br />

arbitration awards may also be enforced under procedures set out within the Arbitration (Guernsey)<br />

Law, 1982. The Royal Court is likely to look favourably on enforcing arbitration awards as it generally<br />

seeks to encourage alternative dispute resolution.<br />

Guernsey continues to see a relatively steady flow of disputes being referred to arbitration across a<br />

number of different types of dispute. Over recent years, a number of disputes have entailed some<br />

form of reference to the Royal Court for determination of particular issues, but this has not been<br />

particularly common. Further, recently the legislature of the Island has tacitly endorsed arbitration<br />

as an important form of dispute resolution following the enactment of the Trusts (Guernsey) Law,<br />

2007, which contains provisions which specifically provide for the arbitration of trust disputes. Such<br />

provisions are not often found in the trust legislation of different jurisdictions.<br />

Being a financial centre, and in particular an important jurisdiction for investment funds, insurance, the<br />

fiduciary sector, banking and asset management, there are a considerable number of legal agreements<br />

concluded each year under Guernsey law and/or involving Guernsey entities. An appreciable<br />

proportion of these agreements will include provisions to refer disputes to arbitration (although the<br />

proportion does tend to vary on an industry-specific basis). Accordingly, arbitration appears set to<br />

continue as an important form of dispute resolution within Guernsey, for which there is a good level<br />

of recognition and support, both through the legislature, judicially and through industry.<br />

The most prominent arbitral institution is the Channel Islands branch of the Chartered Institute<br />

of Arbitrators. However, there are a wide range of institutions which are commonly identified in<br />

arbitration agreements as the party which will choose and appoint the arbitrator for a reference under<br />

that agreement. Often arbitration agreements will not contain extensive provisions for the rules,<br />

language, fee structure and similar of a reference and therefore parties often conduct references<br />

adopting rules of their own agreement or rules produced by an external arbitral institution.<br />

Mediation and ADR<br />

The Royal Court has a duty under the Royal Court Civil Rules to actively manage cases which includes<br />

encouraging the parties to use any appropriate form of alternative dispute resolution. Mediation is<br />

a frequently used method of alternative dispute resolution with both locally based mediators and<br />

mediators from alternative jurisdictions, particularly England, being used regularly. The Royal<br />

Court’s duty extends to facilitating the use of ADR. Accordingly, civil proceedings will often be<br />

stayed to allow the parties to mediate, where such a course may lead to settlement. It should be noted,<br />

however, that under the Guernsey doctrine of peremption, further proceedings may be barred a year<br />

and a day after the last step taken in the proceedings, unless the Court exercises its discretion to restore<br />

the matter to the list. A recent pilot scheme encouraging mediation for publicly funded non-family<br />

disputes was deemed a success and has been maintained.<br />

* * *<br />

GLI - <strong>Litigation</strong> & <strong>Dispute</strong> <strong>Resolution</strong> First Edition 130 www.globallegalinsights.com<br />

© Published and reproduced with kind permission by Global Legal Group Ltd, London


<strong>Appleby</strong><br />

Guernsey<br />

Endnotes<br />

1 The head of the judiciary is the Bailiff. Other judicial appointments in the Royal Court include<br />

Deputy Bailiff, Lieutenant Bailiff and Judge.<br />

2 The Jurats are members of the public elected to the office of Jurat, part of the role of which is to<br />

perform determinations of fact in judicial proceedings, in a similar manner to that undertaken by<br />

juries.<br />

3 Which involves a plea for assistance, the recitation of the Lord’s Prayer in French and then the<br />

grace in French.<br />

GLI - <strong>Litigation</strong> & <strong>Dispute</strong> <strong>Resolution</strong> First Edition 131 www.globallegalinsights.com<br />

© Published and reproduced with kind permission by Global Legal Group Ltd, London


<strong>Appleby</strong><br />

Guernsey<br />

Jeremy Le Tissier<br />

Tel: +44 1481 755 605 / Email: jletissier@applebyglobal.com<br />

Jeremy Le Tissier is a partner and the local group head of the <strong>Litigation</strong> and<br />

Insolvency department. Jeremy practices all aspects of commercial litigation,<br />

contentious insolvency and contentious trust issues. He advises on fraud and asset<br />

recovery, disputes relating to banking and investments, directors and shareholders,<br />

and investment funds. He also advises on asset confiscation, money laundering issues,<br />

cross-border disputes, property related litigation and arbitration as well as proceeds<br />

of crime issues and regulatory matters. Jeremy is the treasurer of the Guernsey Bar<br />

Council. He is also an Associate of the Chartered Institute of Arbitrators, a member<br />

of the Proceeds of Crime Lawyers Association (POCLA) and is a Chartered Surveyor.<br />

Jeremy is also an international member of the Chancery Bar Association.<br />

Adam Cole<br />

Tel: +44 1481 755 614 / Email: acole@applebyglobal.com<br />

Adam Cole is an associate in the <strong>Litigation</strong> and Insolvency department. He practices<br />

all aspects of commercial litigation, contentious insolvency and contentious trust<br />

issues. Adam has experience of cases involving banking and investment funds,<br />

commercial property, regulatory issues and administration.<br />

<strong>Appleby</strong><br />

First Floor, Lefebvre Place, Lefebvre Street, St Peter Port, Guernsey GY1 2JP<br />

Tel: +44 1481 755 600 / Fax: +44 1481 728 992 / URL: http://www.applebyglobal.com<br />

GLI - <strong>Litigation</strong> & <strong>Dispute</strong> <strong>Resolution</strong> First Edition 132 www.globallegalinsights.com<br />

© Published and reproduced with kind permission by Global Legal Group Ltd, London


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