Wright v Granath (CA)

Reference: [2021] EWCA Civ 28

Court: Court of Appeal (Civil Division)

Judge: Moylan, Singh & Popplewell LJJ

Date of judgment: 15 Jan 2021

Summary: Defamation – Jurisdiction – Lis Pendens – Lugano Convention – Negative Declaratory Relief

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Appearances: Adam Wolanski QC - Leading Counsel (Appellant)  Greg Callus (Appellant)  Lily Walker-Parr (Appellant) 

Instructing Solicitors: ONTIER LLP

Facts

C is a computer scientist based in England with an interest in cryptocurrencies. He claims to be behind the pseudonym ‘Satoshi Nakamoto’, who authored a 2008 academic white paper describing how Bitcoin operates and is regarded as the person (or persons) who created Bitcoin.

D is a citizen of Norway and is resident in Oslo. He tweets about various technology issues, including Bitcoin. He believes that C’s claim to be Satoshi Nakamoto is false and, on 17 March 2019, published the following tweet:

“The forensics to [C’s] first attempt to fraudulently ‘prove’ he is Satoshi. Enabled by @gavinandresen. Never forget.  #CraigWrightIsAFraud.” (“the Tweet”)

On 29 March 2019, C sent a letter of claim in libel to D’s Twitter account (as his identity was, at that stage, unknown to C) seeking a number of remedies and claiming, among other things, that the Tweet carried the following false and defamatory meaning: “that C had fraudulently claimed to be Satoshi Nakamoto, that is to say the person or one of the people who developed Bitcoin”.

Upon receipt of this letter, D deleted his Twitter account. On 15 May 2019, C sent a further letter to D’s LinkedIn and Facebook accounts. This was also served by hand on D on 20 May 2019.

On 19 May 2019, D issued proceedings in Oslo seeking an exculpatory judgment regarding C’s allegation and a declaration of non-liability (or ‘negative declaratory relief’ (“NDR”)) on the basis that, applying Norwegian law and article 10 ECHR, the Tweet is not unlawful, as C’s claim to be Satoshi Nakamoto is incorrect. Alternatively, if the Tweet was libellous of C, D claimed that C suffered no loss because his reputation was damaged prior to D’s Tweet (“the Norwegian Claim”).

On 26 June 2019, C issued the present claim in England, seeking damages and an injunction in libel in relation to the Tweet, on the basis of the defamatory meaning stated in the letter of claim (“the English Claim”).

D acknowledged service of the claim and issued a Part 11 Application asking the English Court to decline jurisdiction pursuant to Article 27(2) of the Lugano Convention (lis pendens), on the grounds that the Oslo District Court was first seised and that the Norwegian Claim and the English Claim involved the same cause of action.

In an Order of 16 January 2020, Jay J granted D’s Part 11 application, with the effect that, pursuant to article 27(2), the English Court declined to exercise any jurisdiction it may have had to determine C’s claim, and set aside the Claim Form.

C appealed to the Court of Appeal.

Issue

  1. Whether the English claim and the Norwegian NDR claim were the same cause of action (“Ground 1”); and
  2. Whether, if so, the consequences of lis pendens should nonetheless be avoided as an abuse of EU law, on the grounds that an NDR claim interfered with the ‘substantive right’ of the victim in a personality rights action to elect the forum (“Ground 2”).

Held

Appeal allowed on the basis of Ground 1 (Popplewell LJ dissenting).

Ground 2 rejected.

 

Ground 1

The English and Norwegian claims do not have the same cause of action for the purposes of article 27 of the Lugano Convention.

While they might have the same objet (namely, determination of liability for the Tweet and for damages/ NDR), they do not have the same cause: Moylan LJ at [167]. The Norwegian claim (based upon the Norwegian Damages Compensation Act 1969 s.3-6a) included a legal element not featured in the English proceedings, namely, whether the allegations were or were not made negligently: Moylan LJ at [173].

Accordingly, the juridical basis of the proceedings is not the same: Moylan LJ at [175].

The judge below also erred in holding that “the correct approach is to determine whether there is a significant or substantial degree of commonality or overlap between the two sets of claims” and that all “that is necessary … is that there is a substantial and important area of common dispute”. That approach applied to the question of the same “objet” and not whether they had the same “cause”.

It is the answer to the question of whether the causes of action are the same which will determine whether conflicting judgments will be irreconcilable: Moylan LJ at [170].

 

Ground 2

Article 27 is not inapplicable to defamation claims.

Inherent in the nature of mosaic claims, which Shevill ([1995] 2 AC 18) determined was available to defamation claimants under article 5(3), is that the choice so conferred is a multiple forum choice. Arguably there will be a tension with articles 27 and 28 which restrict such choice.

However, that was not an issue which arose in this case because both the English and Norwegian claims were ‘global’ claims, and Article 5(3) confers options for global claims in defamation which are single forum choices for the resolution of the entire dispute between the parties.

There is no authority to suggest that article 27 is inapplicable to defamation claims, and no sound reason for restricting its applicability. On the contrary, the avoidance of parallel proceedings and risk of irreconcilable judgments which article 27 is designed to avoid dictates that it should apply: Popplewell LJ at [99].

Comment

The value of this judgment to English and Welsh lawyers depends entirely on the result of the UK’s application to accede to the Lugano Convention following the Brexit implementation period. If it is refused, this judgment will be notable as one of the last judgments of the English Courts considering the applicability of the lis pendens provision under the Lugano Convention, but will otherwise be somewhat ‘dead letter’.

On the other hand, if permission to accede is granted, this case represents the most significant refinement of the article 27 criteria since the Supreme Court handed down The Alexandros T ([2013] UKSC 70, [2014] All ER 590), particularly regarding the issue of whether two claims can be considered as having the same cause of action (“le même objet et la même cause”).

Albeit obiter, worth noting are Popplewell LJ’s remarks concerning claims for negative declaratory relief brought by a prospective defendant in a jurisdiction which is more “favourable” to him. He acknowledges that it would not be “contrary to the scheme of allocation of jurisdiction under the Convention, or unfair” to bring such a claim; indeed, it is the prospective defendant’s “right”: see [94]-[95]. At [101], he further concludes that no abuse shall arise merely because it restricts the choice of forum available to the prospective claimant under Article 5(3).