MIDDLE EASTERN OIL LLC V NATIONAL BANK OF ABU DHABI

[2008] EWHC 2895 (Comm), Queen’s Bench Division. Commercial Court, Mr Justice Teare, 27 November 2008

Conflict of laws – Application for stay of English proceedings – Forum non conveniens – Whether parties had agreed to an exclusive jurisdiction clause for the courts of the UAE – Whether there were good reasons for disregarding the clause – Law applicable to tort – Private International Law (Miscellaneous Provisions) Act 1995

The claimant, a company incorporated in Dubai, had a US dollar bank account with the defendant bank. The applicable law was that of the UAE, and under the jurisdiction clause in the contract each party agreed to submit to the jurisdiction of the civil courts of the UAE but without prejudice to the bank’s right to take proceedings in any court whatsoever. The claimant commenced proceedings in England and the defendant sought a stay on the grounds that the bank was required to sue in the UAE and that the UAE was the more appropriate forum. Teare J held that the clause was an exclusive jurisdiction clause and that it was to be enforced unless there were strong reasons for not doing so. The court could not see any such strong reasons: the fact that the alleged loss had been suffered in England had been a circumstance foreseeable when the agreement was made; the claim was not predominantly connected to London; the law applicable to the alleged tort committed by the bank under the Law Reform (Miscellaneous Provisions) Act 1995, s 11, was probably that of the UAE, as it was from that jurisdiction that a transfer of funds had been refused – the fact that this had caused loss in England was irrelevant; if that was wrong and the tort was committed in England, it was substantially more convenient under s 12 of the 1995 Act for the law applicable to the contract (that of the UAE) to determine the tort; and there were no reasons for believing that there could not be a fair trial in the UAE or that the law in the UAE was not sufficiently developed.