The High Court has refused an application by the Medical Defence Union Limited and M.D.U Services Limited to set aside service of a third-party notice in a dispute over indemnity for a former consultant surgeon.
The judgment, delivered by Finnegan P. on 5 April 2006, concerned the court’s jurisdiction to hear the surgeon’s claim against the two organisations. The Union argued that the dispute concerned the validity of a decision by one of its organs and therefore fell within the exclusive jurisdiction of the courts of England and Wales, where it said the Union had its seat.
The surgeon’s notice alleged, among other things, that the Union was bound by its past conduct and representations to provide indemnity, that it had not properly considered his circumstances, and that its refusal was unfair and discriminatory. These were allegations in the pleaded claim, not findings made in this judgment.
The Union’s rules provided for assistance and indemnity at its discretion. It had continued to pay the surgeon’s legal and expert costs in defending the underlying claim, but its Board of Management decided not to indemnify him for any damages or third-party costs awarded against him. The court noted that the surgeon had been invited to make representations during the review process.
Finnegan P. held that the claims, considered as a whole, challenged the propriety or correctness of the Union’s decision, not its validity under company law. The dispute did not turn on whether the board had authority to act or had followed required corporate procedure. The court therefore concluded that the exclusive-jurisdiction rule in Article 22.2 of Regulation 44/2001 did not apply.
The judge also rejected the surgeon’s reliance on the special jurisdiction for third-party proceedings under Article 6.2. He held that Article 22.2 would take precedence where it applied, but found that it did not govern this claim. The court refused the applicants the relief they sought. The ruling addressed jurisdiction and service only; it did not decide whether the surgeon was entitled to an indemnity or resolve the underlying negligence proceedings.