OFFSHORE CASE DIGEST: - Conyers Dill & Pearman

BRITISH VIRGIN ISLANDSAprilENFORCEMENT OF JUDGMENTS – SUBMISSION TOFOREIGN JURISDICTIONStar Reefers Pool Inc v JFC Group Co Ltd (CommercialCourt) (BVI)This was an application made without notice to register amoney judgment of the English High Court in the BritishVirgin Islands. The issue was whether the Applicant could besaid to have voluntarily appeared or otherwise submitted oragreed to submit to the jurisdiction of the English Court. If itdid not then since the Respondent neither carried on businessnor was ordinarily resident in England, section 3(2)(b) of theReciprocal Enforcement of Judgments Act 1922 (Cap 65)would preclude registration. The Court concluded that theRespondent had submitted to the jurisdiction of the High Courtof England by actively participating in post-judgment freezingorder proceedings taken by the Applicant. In doing so it appliedparagraph 14-067 of Dicey, Morris & Collins, The Conflictsof Law, 14th Edn., which states that such an interventionwould constitute submission. More importantly the court heldthat acknowledging service and seeking unsuccessfully tochallenge jurisdiction to argue forum could not be seen assubmission to the jurisdiction. In so doing the court declinedto follow the decisions in Harris v Taylor [1915] 2 KB 580and Henry v Geopresco [1976] 1 QB 726. The Court heldthat since these authorities were no longer part of the laws ofEngland, having been abrogated by the United Kingdom CivilJurisdiction and Judgments Act 1982, and were now “deadletters in the jurisdiction in which they previously applied”,they would not be introduced in the law in the BVI as suchan archaic rule would “throw English and BVI practice andprocedure out of alignment”. He held section 11 of the EasternCaribbean Supreme Court (Virgin Islands) Act encourageduniformity in the law and practice between the jurisdictions andit would be a “retrograde step and contrary to the spirit of theseprovisions of our legislation, for me to introduce into the lawthe BVI rules which ceased to be part of the law of Englandthirty years ago.” A possible effect of this finding may in fact bethat any previous decision or line of authority in England whichhas now been superceded by legislative developments maynot be applied in the BVI by the Commercial Court. This is asignificant development indeed.COMPANIES – UNFAIR PREJUDICE – BVI BUSINESSCOMPANIES ACT S. 841 – STRIKE OUT – NO UNFAIRPREJUDICE WHERE DERIVATIVE ACTION LIESNigel Gray v Allan Leddra and Pro-flex Packaging CoLimited (Commercial Court) (BVI)Here the Applicant Allan Leddra applied to strike out theClaimant’s unfair prejudice claim under section 1841 of theBVI Business Companies Act on the basis that the claim aspleaded included claims in respect of a wrong actionable atthe suit of the company which amounted to an unauthorizedderivative claim. The Applicant relied on the case of Re ChimeCorp Ltd (2004) 7 HKCFAR where Lord Scott held that whilethe Courts of Hong Kong had jurisdiction in the strict sense toentertain within the confines of an unfair prejudice applicationa claim for relief in respect of a wrong actionable at the suitof the company in question such a claim would ordinarilynot be allowed to be advanced unless the claim for recoverycorresponded precisely with the company’s claim and it wasclear from the pleading that that quantification of the valueof the claim could be made conveniently at trial. The Courtdisapproved of Lord Scott’s treatment of conflicting authorityin the Chime case as “unsatisfactory” and found the caseunhelpful. In his judgment, the position in the BVI was clear.A derivative action requires permission under section 185C ofthe Act and in light of the nature of the conditions which thecourt must be satisfied before granting permission it would bean abuse of process to attempt to mount in the context of anunfair prejudice action a derivative claim without the consentof the Court.conyersdill.com • 15