The Supreme Court has referred a question to the European Court of Justice about whether Irish proceedings may be stayed when an earlier case involving the same dispute is pending in a non-EU country. It did not decide the stay application or the underlying allegations.
The appeal concerns proceedings brought in Ireland by Goshawk Dedicated Limited, Kite Dedicated Limited, Cavell Management Services Ltd and Cavell Managing Agency Ltd against Life Receivables Ireland Limited. The Irish companies seek declarations denying alleged misrepresentations connected with a partnership investment, insurance policies and the management of an insurance syndicate.
Life Receivables had filed proceedings first, in June 2007, in the US District Court for the Northern District of Georgia. Its complaint alleges securities fraud, fraud, negligent misrepresentation and conspiracy. Those allegations have not been determined in this appeal. The Irish proceedings, issued in September 2007, seek relief that largely mirrors the US claims, with the parties reversed. The US case also includes other defendants who are not parties to the Irish proceedings.
Life Receivables asked the High Court to stay the Irish case until the US proceedings were resolved. The High Court refused. It held that EU Regulation 44/2001 required Ireland to exercise jurisdiction over a defendant domiciled here, and that the regulation did not permit a stay based on earlier proceedings in a non-member state. It also rejected the argument that the Irish proceedings were an abuse of process.
Life Receivables appealed. It argued that the regulation’s rules on proceedings pending in different member states could apply by analogy, or that Irish courts retained a discretion under the doctrine of lis alibi pendens to stay a case where related proceedings had begun elsewhere. The companies argued that the regulation required the Irish case to proceed.
The Supreme Court said the relevant European Court of Justice ruling, Owusu v Jackson, had not answered the question raised by an existing case in a non-member state. The Court said the issue was therefore not acte clair and that a reference was necessary. In essence, it will ask whether Regulation 44/2001 is inconsistent with a member state court declining jurisdiction or staying proceedings because the same parties and cause of action are already before a non-member state court. It may also seek guidance on what criteria should apply if a stay is permitted.
The Court did not grant a stay, rule on the merits of either case or settle the interpretation of the regulation. It directed the parties to prepare proposed terms for the reference, with submissions to follow.