In the High Court of Justice

Queen's Bench Division

Commercial Court


1997 Folio No. 317


Court No. 3

St Dunstan's House

Fetter Lane

London EC4


28th November 1997


Before: Mr Justice Nance


The Society of Lloyd's v David Frederick West


Mr R Jacobs, instructed by Freshfields, appeared on behalf of the Plaintiffs

Mr R Lord, instructed by Wedlake Bell, appeared on behalf of the Defendant


Unofficial Judgement


Computerised transcript of

Smith Bernal Reporting Ltd

180 Fleet Street

London EC4A2ED





[*2] scheme is enforceable so as to require Names to pay their Equitas premium irrespective of cross-claims, including cross-claims for fraud.


The course of events in the present case is that Lloyd's, as only too often happens, appears to have delayed until near the end of the four-month period for service, giving rise to arguments about whether service effected was good.


The writ was purportedly served on Stafford Run Off Agency Limited on the basis that they were or had been Mr West's member's agents.


The plaintiff's solicitors, Dibb Lupton Alsop sent a copy of the writ, which they said they would be serving on the member's, agents, to Mr West at his Santa Barbara address under cover of a letter of 18th July 1997 reading:


"As a matter of courtesy, we enclose a copy of a writ which has been served out of the Commercial Court in London an served on your Members' Agent. As you are aware, in accordance with the terms of your General Undertaking and the Membership Bylaw (No. 17 of 1993), you appointed your Members' Agent to accept service of proceedings in the English courts on your behalf.

"Your Members' Agent will be sending the service copy writ and an Acknowledgment of Service form to you direct and you should return the Acknowledgment of Service form to the Commercial Court Registry within the period set out in the Guidance Notes to avoid default judgment being taken against you. If you are in any doubt as to how you should act, we recommend that you instruct lawyers in London immediately."


It is the position that Mrs West owns the premises [*3] in Santa Barbara and lets it to tenants from time to time. It is only occupied occasionally by the West family. It is not an address which he had given to Lloyd's or which he ever used for business purposes. He, in fact, has another address at Newport Beach, but he actually lives in Texas and is registered to vote there. He lives at 3301 Barton Creek Boulevard, Austin, Texas.


Nonetheless, the writ came to his attention. Firstly, the package sent by Dibb Lupton containing the letter with a copy of the writ came to his attention as a result of a phone call from DHL, the international couriers, on 23rd July. They told him that they were attempting to deliver a package from Dibb Lupton Alsop addressed to him at the Santa Barbara address. He contacted DHL and, in one way or another, the package was subsequently forwarded to him in Texas where it was received by him on Friday, 25th July with its contents.


The actual sealed copy written Acknowledgment of Service, which had been purportedly served on Stafford, was forwarded by them and was received by him on 30th July. MrWest, pursuant to the receipt of these documents, acted with dispatch and took advice from his United States attorneys, who took advice from Mr West's present solicitors, Wedlake Bell. Notice of Intention [*4] to Defend was given on behalf of Mr West by Wedlake Bell on the last day allowed for that: 31st July.


It is pointed out that no particular significance has been attached to this in argument before me, that that happened to be the day on which the Court of Appeal handed down its judgment in the case brought by the Society of Lloyd's v Leighs. Perhaps the reason no significance is attached to it is that if the writ had been served earlier or more promptly, then Mr West would have been acting prior to that case. It cannot be suggested that any defect or delay in service in this case has deprived him of the opportunity of considering that case. On the contrary, it nearly gave him the opportunity, but not quite.


The course taken was then to issue the present application under Ord. 12, r. 8. All that is very conventional and very sensible. No doubt it does not in any way prejudice Mr West, because if he does not wish to pursue his Ord. 12 r. 8 application or if it fails, he is in no way treated as having submitted to the jurisdiction. He has the choice of whether or not to enter a fresh Notice of Intention to the [sic] Defend and so submit. If he does not wish to, he can have nothing to do with the present proceedings.


The submission on behalf of Mr West, put forward [*5] succinctly and clearly by Mr Lord, is that this course of service involved error in two principal respects: firstly, in the person on whom the writ was served; and, secondly, in the address on the writ which was the California rather than the Texan address.


As to the first point, it is clear that under the relevant bylaws, AUA9, which is a substitute agency appointed in substitution for the managing agents of Mr West's syndicates, had or would have had authority to receive service had it been effected on them. The Society of Lloyd's has on affidavit acknowledged before me, in effect, that it wished it had served them and that it was an administrative error, as they put it, although they do not accept that it was a legal error, to purport to serve on Stafford. They would not have found themselves faced with the present application, I suspect, if they had served AUA9, because it would have been much more difficult to see a basis for it.


However, the Society of Lloyd's does submit that it was in fact also proper in short for the reasons set out in Dibb Lupton's letter of 18th July to serve on Stafford as the member's agent.


The relevant bylaw which introduces AUA9 into its functions, the substitute agent's bylaw annexed to the Points of Claim, makes clear that AUA9 were substituted [*6] not for Stafford, but for the managing agents. Mr Lord accepts, and it is clear, that Stafford were only Mr West's member's agent. Lloyd's contention is that Stafford's authority under the member's agents' agency agreement continued alongside AUA9's.


A number of points were raised by Mr Lord. The first was only raised on the basis of an affidavit in reply of his solicitor, Mr Hewitt, who suggested that it was in issue whether Stafford had authority on behalf of Mr West.


That is developed or transmuted in Mr Lord's skeleton into a submission that Stafford were never appointed as agents by Mr West. That, I must say, is not at all convincing, bearing in mind that Mr Hewitt's first affidavit reads as follows:


"4. Mr West's member's agents were latterly Stafford Run Off Agency Limited. It is not clear on what basis they were appointed."


He then goes on to account that originally it had been RW Sturge and then says:


"But following 1986, it appears that RW Sturge's responsibilities were transferred to Falcon and then on to Stafford. The precise chain of events in relation to the purported transfer of responsibilities from Sturge to Falcon and to Stafford are not known to Mr West and have not been explained to him. On 31 October 1996, Mr West wrote to Stafford terminating their authority to act as his agents."


He produces that letter and reads: [*7]


"RE: Termination of Agency Relationship


"Dear Sirs:


"I have for some considerable time now been writing to you to request information in relation to my Lloyd's affairs. As my Lloyd's agent, you have been contractually bound to provide me with copies of documentation and information relevant to my underwriting affairs. You have failed not only to comply with this requirement, but, in fact, you now completely failed to meaningfully response [sic] to my letters at all since J.D. Hamilton's letter of July 1995.


"In consequence, I appear to have no choice but to regard your behavior as a fundamental breach of our agency agreement and a breach of the fiduciary duties which you owe to me as trustee. In consequence, y our authority t6o act as my agent in connection with my Lloyd's affairs or indeed any other affairs is hereby terminated.


"As you have failed in the past to acknowledge receipt of my letters, I am taking the precaution of insuring this is delivered to you by registered post."


There could not be a clearer statement of what Mr West's true belief is. Namely, that Stafford were his contractually-bound agent as such and there can be really no doubt that they must have been contractually bound on the terms of the standard Agency agreement which was prescribed by Lloyd's bylaw which was at the relevant time the agency agreement's bylaw no. 8 of 1988, 7th December 1988.


It is, I think I can take notice, quite impossible for Mr West otherwise to have remained an underwriting member of Lloyd's if he did not subscribe to that agency agreement as he was obliged to under the bylaws. It is, on any view, as the affidavits state, the standard [*8] agency agreement and the agency agreement to which he would have been contractually party in the ordinary course of events.


Under that agency agreement, there is a provision for termination in clause 11.6 in these terms:


"The Name may terminate the appointment of the Agent under this Agreement, subject to clause 11.7, by notice in writing given by the Name to the Agent by 31st August (or by any later date which the Agent may in any particular case permit) in any year and expiring at the end of that year."


What is said in this case is that by the letter which I have read which was dated October 31st 1996, the agreement was terminated forthwith for repudiation, although that was after 31st August. I certainly accept, in principle, that if there was a repudiation, it would be open to the innocent party to determine the contract whenever he did so forthwith.


However, there is actually, on the evidence before me, nothing in the affidavits to substantiate the case of repudiation. The mere assertion in the letter is certainly not good enough. Mr Lord said that no doubt an affidavit could be sworn, but the fact is that none has been.


On that basis, I pass to the next submission, which is that, in any event, the agency relationship was terminated consensually. Prima facie, Mr Lord says, an [*9] agent's relationship may be determined at will, and no doubt that is so at common law, but bylaws, which Mr West was committed to observe by a general undertaking, dated 9th September 1986, which he signed with the Society of Lloyd's, and the terms of the standard agency agreement, which was entered into pursuant to such bylaws, having been prescribed by the 1988 bylaw which I have mentioned, contain clause 11.4 which only allows termination unless [sic] the agents in any case permit a later termination by 31st August. This one was clearly late and so, on the face of it, was ineffective.


However, it is said by Mr Hewitt in reply in his affidavit on information and belief from Mr West, that the fact that Stafford did not respond to Mr West's letter of 31st October 1996 by saying that he was too late to withdraw their authority, led Mr West to believe that they had accepted the termination of their authority. No other substitute agent has been appointed by Lloyd's so far as Mr West knows. That is a plea of estoppels which, if it is to be good, must be founded on the proposition that there was some duty to speak and that one can infer permission from silence. As a general proposition, I do not think that is right and I doubt whether it is right in this context. [*10]


Looking at the matter as I must at this stage, on the balance of probability, it seems to me that Mr West has not made good his case that the authority was terminated consensually.


That leaves the further point -- and I think it is accepted -- that if the authority of Stafford as member's agent continued, then it would extend to receipt of service. No contrary argument was addressed to me. The argument addressed was that if it was terminate, [sic] then the provisions of clause 11.7 dealing with authority after termination do not extend to cover service.


Even though the authority was not terminated and would, prima facie, extend to service, the further argument was addressed that AUA9's authority, in effect, excluded Stafford's authority or superceded [sic] it. That argument depends on the terms of AUA's [sic] authority which, under the Reinsurance and Run-Off Contract, read as follows:


"Service of Process


"25.2 Each Name and closed Year Name not domiciled in the United Kingdom hereby irrevocably appoints the Substitute Agent [that is AUA9] as agent to accept service of any proceedings in the English courts on his behalf."


Clearly, that is in the context of the Equitas Reinsurance Contract. Then I need not read the next two [*11] sentences. Then the last sentence says:


"Nothing herein shall affect the right to serve process in any other manner permitted by law."


It seems to me that that last sentence is probably wide enough to cover and preserve any other right to serve, such as a right to serve on a member's agent, which otherwise exists. That is another manner permitted by law if there is such another agreement.


On that basis, since there has been on the probability no termination, and since the agency has not been, as regards service, superceded [sic] by AUA9's concurrent authority, it follows, on the face of it, that service on Stafford was, in my judgment, good.


I ought just to say a word about the position if Stafford's agency had been terminated. One then comes to clause 11.7 which reads as follows:


"Upon the termination of the Agent's appointment pursuant to the preceding paragraphs of this clause 11, the Agent's authority under clause 2.2 shall also terminate. Subject to this and to any requirements of the Council for the time being applicable, the Agent shall be empowered and obliged following the termination of its appointment to wind up the business and (if the Name has ceased to carry on the business of underwriting at Lloyd's save for the purpose of or in connection with business previously so underwritten) those affairs of the Name at Lloyd's in respect of which the Agent acts as the Name's members' agent."


I need not read the next part. Then there was a clause added form 1st January 1996 by bylaw no. 1 of [*12] 1996 relating to Equitas, reading as follows:


"[11.7A The matters referred to in paragraphs (a) and (b) of clause 11.7 [which I have not in fact read] may include matters arising out of or in connection with business which is to be the subject of an Equitas reinsurance contract and the Agent shall in relation to any matters so arising continue to have the powers, duties and discretions conferred by this Agreement for as long as is necessary to enable those matters to be resolved.]"


As I read that, it specifically relates to business, the subject of an Equitas reinsurance contract, for example, or, in particular, underwriting business reinsured with Equitas. It does not embrace matters which arise directly under or in respect of the reinsurance.


That is not surprising, since the expectation would have been that those matters would be dealt with by AUA9 and, in particular, service would have been made on AUA9. That does rather suggest that in relation to the more general clause 11.7, despite the generality of the authority after termination, that may not be capable of being construed as wide enough to embrace an issue arising under the Equitas Reinsurance Contract. That argument might have been carried back, I suppose, to the period while the agent's appointment was on foot and had not been terminated but, as I have said, it was not in fact carried back so far.


On this basis, I go on to consider the address [*13] point. Prima facie, if service on Stafford was good, the address of Mr West on the writ is irrelevant.


It is not suggested in Mr Hewitt's first affidavit, paragraph 10, that Stafford was misled into sending it to any wrong address. Indeed, I note that Mr Hewitt does not actually say to which address Stafford did address the writ and Acknowledgment of Service form. He simply says that they were not received until 30th July. By inference, it may be, therefore, quite likely that they were sent direct to him in Texas, in which case there could be no conceivable argument or complaint arising out of the mistaken address.


Even if that is wrong, however, I do not think that Mr West has any grounds for setting aside this writ or any grounds which ought to prevail on the grounds of a wrong address.


In smith v Eammond, the Divisional Court had to consider, admittedly a case of personal service within the jurisdiction, where the writ was wrongly addressed to the defendant as being of Lytham in the county of Lancaster. His only place of business and residence were [sic] in fact Londonderry in Ireland. Nonetheless, the court held that that was an irrelevance.


The judgment of Bruce J suggests that the [*14] requirement in the form of writ given in the appendix prescribed by Ord. 46, r. 1, that a defendant be described as of such and such a place, is merely there for purpose of identification and is not a formality which has to be complied with for the writ to be regular.


I am not sure that Baron Pollack went so far, but he clearly took the view that this was a minor matter which, in the absence of any misleading or prejudice, certainly would not give rise to any remedy in court.


In the present case, as I say, assuming service was correctly made on Stafford, there is no evidence that the wrong address, even if it was a defect, had any detrimental effect at all. The course of events which I have outlined involved receipt from Dibb Lupton on 25th July of notice of the proceedings with copy writ, followed on 30th July by receipt of the originals.


That is against the general background, I should add -- which is accepted by Mr Lord also -- that Names at Lloyd's would have been aware that proceedings were in the offing and also that Mr West in evidently very familiar with the problems at Lloyd's and is litigating about them in California. All those factors together would have led to the conclusion that there was no basis for treating any irregularity in the address as [*15] significant or other than a minor point, and no basis for concluding that Mr West had suffered in that regard any significant prejudice at all.


Accordingly, the court should, if there was an irregularity in that regard relating to an address, waive it under Ord. 2 of the Rules of the Supreme Court.


What if I am wrong regarding Stafford's continuing agency? The consequence then is that there was not merely an administrative error in serving on the wrong agent. They could and should have served on AUA9 if they wished to serve within the jurisdiction. This is not a case where they could only serve by seeking leave to issue and serve out of the jurisdiction a concurrent writ. It is a case where they were entitled to serve on an agent, a substituted agent, indeed, an imposed agent -- AUA9 -- an agent who one might have thought in a way was even less welcome to Mr West than Stafford might have been, although he evidently had parted company with them on the basis as one can see form the letter of 31st October 1996.


However that may be, the fact is, once again, starting from the proposition that this is not a case where the limitation period has expired, although the [*16] writ only actually reached his attention personally after the period of its validity had expired on 25th and 30th July, it is not a case where a new writ could not be issued and reserved. The limitation period was nowhere near expired.


On the facts, he was able to act and protect himself without prejudice. He complains through Mr Hewitt's affidavits about the delay and about the prejudice in loss of the opportunity to consider his position maturely, but those are general statements which do not impress me in the absence of any specific suggestion of any specific prejudice in any particular respect. On the face of it, there is no prejudice at all.


The courts have rightly, in my view, shown themselves increasingly reluctant to give effect to defects in the manner of service which have caused no substantial delay when the consequence of doing so would simply be to cause further delay and costs.



A striking case, although it did not involve delay, was the case of the Golden Mariner [1990] 2 Lloyds Rep 215, where the wrong writs were served on the wrong defendants and one defendant was simply served with a form of Acknowledgment of Service and not a writ at all. The court dealt with that by a majority in [*17] fairly trenchant terms. McCowan LJ, in particular, cited from Kerr LJ in Singh v Atombrook Ltd [1989] 1 WLR 810 at page 820. This is citing from McCowan LF's judgment at page 223. Kerr LJ said:


"'Of course, in the present case there was never the slightest doubt in the minds of the defendants that the plaintiff intended to sue them and that they were the persons with whom this case was concerned'."


He then went on:


"The approach of this Court to the exercise of discretion was stated as follows by Lord Justice Cummning-Bruce in Metroinvest Ansalt [sic] v Commercial Union [1985] 1 WLR 513 at p. 521F:


"'I would say that in most cases the way in which the court exercises its powers under Ord. 2, r. 1(2) is likely to depend upon whether it appears that the opposite party has suffered prejudice as a direct consequence of the particular irregularity, that is to say, the particular failure to comply with the rules. But I would construe Ord. 2, 3. 1(2) as being so framed as to give the court the widest possible power in order to do justice...'


"Mr. Tomlinson frankly accepted that he could point to no prejudice suffered by any one of these six defendants by reason of the irregularity. Consequently I have no hesitation in concluding that this Court should exercise its discretions against setting aside the service upon them."


Sir John Megaw reached the same conclusion. The mistake was very gross in the Golden Mariner. Indeed, Sir John Mega called it "lamentable and inexcusable", one for which the plaintiffs had to bear responsibility. He said:


"If it had resulted in any misunderstanding by, or any prejudice to, any of the defendants concerned, the consequences would have been very different in these proceedings. But it is acceptable [sic] that the mistakes [*18] caused none of them any prejudice: they knew that concurrent writs had been issued and were in existence in respect of each of them, and that it had been the intention that the appropriate documents should be served."


He then went on to consider the authorities dealing with writs requiring service out of the jurisdiction. That is Leal v Dunlop Bio-Processes International Ltd. [1984] 1 WLR 874 and Camera Cars Ltd. v Victor Hasselblad Aktiebolag [1996] 1 PTLR 348. He pointed out, after a lengthy analysis, that at least Leal v Dunlop was a case where a test subsequently superceded [sic] in The Myrto [1987] AC 597, had been applied. That is a test of exceptional circumstances, whereas The Myrto introduces a test of good cause or good reason for extension of a writ after expiry of the limitation period.


That may have affected the court's attitude in Leal v Dunlop. I accept that the fact that a writ needs to be served out of the jurisdiction is a material factor, though the courts have always been solicitous of persons abroad in that they should not be brought within this jurisdiction lightly. However, I have pointed out that, in the present case, this was not a writ that needed to be served out of the jurisdiction. There had been, in this case, express appointment of an agent, AUA9, on any view, to accept service within the [*19] jurisdiction.


Furthermore, even in a case of service out of the jurisdiction, it seems to me that it is ultimately a matter of discretion and the fact that service out of the jurisdiction is involved is only one factor.


In the present case, therefore, even if I am wrong about Stafford's agency, I come unhesitatingly to the conclusion that the circumstances are such that I ought to waive the deficiency in the service and I should treat what has happened, namely, service on the old member's agent, with the writ coming to the attention of Mr West via the old member's agent, as good service and uphold it under Ord. 2, r. 1.


Again, it is necessary to consider the effect of the wrong address. Again, at most, it can have caused only some days delay. Again, I conclude, for similar reasons to those mentioned above, that that is not a ground, even if it involves a deficiency in the writ, for setting aside the service and I should treat it as waived under Ord. 2, r. 1.


As I say, it would ultimately appear to be no more than a waste of time and further cost if I were to take a contrary view in view of what I am about to say about the final point, and that is what Mr Lord called forum conveniens. I do not think that is in fact an accurate [*20] description, because this is a case where there are exclusive jurisdiction clauses agreeing the English jurisdiction, and that on the authority of Lord Goff in Spiliada takes the case outside the principals [sic] of forum conveniens -- and I refer to the words of Lord Goff at page 480 in Spiliada -- into a special category which is governed by cases such as El Amria, which he referred to, and also The Chapparal [1996] 2 Lloyds 158, an earlier case which is referred to in the skeleton arguments.


Mr Lord accepted that in those circumstances, he had to show good reason for not giving effect to the exclusive jurisdiction clause. In my judgment, no such good reason has been shown. He pointed to the fact that this was an imposed agreement as far as Mr West was concerned and nonetheless it was imposed under lawful authority and I ought to give effect, prima facie, to it and there is a strong prima facie presumption that I should do so.


He pointed to the fact that there was litigation in California under the original underwriting arrangements and membership. The whole essence of the Equitas arrangements is that they are to be treated as separate. The Society of Lloyd's v Leighs case shows that the claim for the Equitas premium can be and should [*21] be treated as separate and can be pursued quite separately from any complaint about the original circumstances in which membership was created or subsequent circumstances in which it was continued.


It is said that Mr West is resident in the United States and so he of course is, but he is in fact resident in Texas, whereas the current proceedings are in California. Those are two different jurisdictions and it appears they are different in material respects potentially, because if the Californian courts maintain their present attitude that they will not enforce the jurisdiction clause because of Californian consumer protection legislation, I understand that that is not an attitude which other states, including Texas, have taken. Anyway, a residence is not a significant factor.


The authorities are very clear that the effect of an exclusive jurisdiction clause is that it is extremely difficult for a party subsequently to complain that it is inappropriate, inconvenient or wrong for him to have to litigate in the place which he has agreed. That seems to be common sense and it has been stated time and again in the authorities. I cited some of them in a decision of mine in Egon Oldendorf v Lybera Corporation [name not checked] [1995] 2 Lloyds Rep 64 at page 72 to [*22] 73. I refer particularly to the words of Hobhouse J in Beresfords v New Hampshire [name not checked] [1990] 1 Lloyds Rep 454, where he said that it had been pointed out in a previous case that the fact that parties have agreed in their contract that the English courts shall have jurisdiction, albeit, in that case, a non-exclusive jurisdiction is an appropriate one. It should, in principle, be a jurisdiction to which neither party to the contract can object as inappropriate. They are both implicitly agreed that it is appropriate. Another authority in the same vein is, of course, The Farouth in the Court of Appeal [1982] 2 Lloyds Rep 351.


The existing proceedings in California are prayed in aid in a different sense, in that it is said that this litigation should be combined with them. That would be quite contrary to the decision of the courts of this country in Society of Lloyd's v Leighs. Indeed, the Californian proceedings are, in English eyes, in obvious breach of the jurisdiction agreements, and therefore not a legitimate factor in the exercise which I have to undertake.


It is said that the purpose of the present proceedings is to recover money from the defendant and he has stated candidly that he is not going to pay [*23] voluntarily, so the Society of Lloyd's will have to attempt to enforce in the United States. That may be so, but it is hardly a reason why the defendant can seek to avoid the jurisdiction which is agreed in this country.


It is perhaps a little surprising to find a defendant being solicitous of a plaintiff's interests in enforcement, but it seems to me that it is not established that enforcement, in particular in Texas or anywhere else where the defendant may happen to have assets, will necessarily involve litigating the very issues that are being litigated in California. As I say, different American jurisdictions appear to have different views and it may be that in some, it will be open to Mr West to seek to re-litigate some matters, despite the existence of an English judgment pursuant to an exclusive jurisdiction clause. I would think that in others it may well not be. I cannot proceed on the basis that it will be.


The further point is made that in California, Mr West would have the protection, which is said to be legitimate, of the consumer protection laws of that place and the California Court of Appeals decision is relied on. However, the contract is clearly subject and expressly subject to English law. If English law is the [*24] governing law and English jurisdiction has been agreed, then this court must take the view that English law provides appropriate remedies.


If -- I think Mr Lord did go so far as to suggest this -- what is complained of is some suggestion that the contract involved commission of an illegality abroad, that is something which English law is able to cater for. There is a principle of English law that a contract may be unenforceable if it involves commission of an illegal act abroad. If, on the other hand, that is not the complaint, then what Mr West is seeking to do is to rely on factors which are not properly admissible under English law as a defence, and he is seeking to do so by saying that English law, which is the chosen law, and the English courts, which are the chosen courts -- or the imposed courts in the case of this defendant -- are not the appropriate courts.


The conclusion I have come to, therefore, is that this is a clear case for enforcement of the jurisdiction clause and that there is no basis for the stay application which was the third an final application which Mr West made.


In those circumstances, I shall refuse to make the declaration sought that the writ has not been duly served. I shall, on the contrary, declare that it be [*25] treated as duly served upon him. I shall refuse to set the writ aside and I shall refuse to stay the action.


MR JACOBS: Can I ask your Lordship to dismiss the summons with costs? There is just one consequential matter which does arise I think on both sides.


Mr West is gong to ask your Lordship to extend time for putting his Further Acknowledgment of Service, because he wants to see what Tuckey J decides in January when Tuckey J is going to consider a point which your Lordship has touched on, namely the effect of Canadian securities legislation and securities legislation generally.


We say there should be no special treatment for Mr West. There is absolutely no reason why he should not be put to his election whether he wants to contest these proceedings or not, as all the other Americans and Canadians have had to do, and very many of them have decided that they are going to contest and run this point.


It does give rise to a further question, that if Mr West does decide that he is going to contest the proceedings, some way ought to be found of bringing him back in the scope of what Tuckey J is dealing with, because Tuckey J made a very complicated order which basically required them to say whether they were running [*26] securities points, so if they are, they can be brought in in some way which is going to be debated before him in due course, into the hearing which is fixed for 21st January.


What I would ask your Lordship to do is, in anticipation, reject Mr Lord's application, but also to make an order that if he does file a further Acknowledgment of Service, he should also notify us within a specific period of time, and we would say 14 days after that, of whether it is his intention to rely upon foreign securities or similar legislation.


MR LORD: Dealing with various points, first of all on the question of costs, whilst I do not consent to the costs order, I can think of no proper argument to advance on it.


On the question of putting in a second Notice of Intention to Defend, we do say, and it is reflected in Mr Hewitt's affidavit, that Mr West should be able to make an informed decision as to what he is doing in the light of the decisions that would be made shortly in this court, so we do ask for an extension of that time.


I should say that although now is not the appropriate time or place to make an order of the nature suggested by Mr Jacobs, there is no doubt that if Mr West does defend these proceedings, it will include [*27] on the basis of the Californian legislation. There is no secret about that. No decision has been made and we ask for time in that regard.


MR JUSTICE MANCE: The difficulty about the time is it does not stop, does it? This is the sort of case where appeals are likely. Why should he sit on the sidelines anymore than any other Name has been able to?


MR LORD: We do not seek special treatment for him. He should not be in any worse position, but we simply ask for the extension of time.


I also ask for leave to appeal. Very briefly, your Lordship has interpreted "permitting" as requiring positive action. I submit that is not a general use of the word. We would then have the difficulty on discretion in any event, and I would submit that this raises the question of which end of the telescope is the wrong end or the right end. I say no more about that, but I ask for leave to appeal.


MR JUSTICE MANCE; I am not going to extend time or give leave to appeal. It seems to me on the first, as I said, that he is really in no different position from any other name who may have been sued in the last year and be resident abroad and have to make that decision. If one were to postpone time to enable greater legal clarity to be forthcoming, there would no way of [*28] knowing when it would be forthcoming. Certainly it is not the sort of case which is necessarily going to stop at first instance. I do not see that as a proper extension. It seems to me on leave to appeal that, ultimately, this is a mater very much of discretion, and I do not feel doubt about it, so I shall refuse leave to appeal.


The costs, I think, do follow the event.


MR LORD: There is one final application. I am instructed to ask for an extension of time until any refusal or grant of leave to appeal by the Court of Appeal, which would have to be made promptly in any event.


MR JACOBS: No. Your Lordship has dismissed this. If my friend wants to go to the Court of Appeal, he can try and get leave, and if he ultimately succeeds in overturning the judgment of your Lordship, then obviously everything that happens in the meantime will fall away. We will not say that by acknowledging service or further participation he has waived that, but he ought to be in as everyone else is in, unless he can overturn the judgment.


MR JUSTICE MANCE: Yes, that must be right. I do not have the original summons. do you have a copy?


MR LORD: I am quite content for a copy to be used. I have the original. (Handed).


MR JUSTICE MANCE: Just summons dismissed with costs? You do not need anymore a declaration that the --


MR JACOBS: I do not think so. I think leave to appeal refused and leave to extend time for acknowledging service refused as well, or intention to defend.


In light of Mr Lord saying his client does intend to run the securities point, I do not think we need any formal order. We will treat him as a person who is running it for all purposes.