SocGen jurisdiction challenge to negative declarations claim dismissed (Clifford Chance LLP and another v Societe Generale SA)

Dispute Resolution analysis: Notwithstanding one of the Claimants being subject to an exclusive jurisdiction clause in favour of the High Court in Paris, the Court has refused a jurisdiction challenge to proceedings seeking negative declarations in the High Court of England and Wales. The entity bound by the jurisdiction clause was not the entity at the core of the main dispute.

Clifford Chance LLP and another v Societe Generale SA [2023] EWHC 2682 (Comm)

What are the practical implications of this case?

This judgment offers an interesting analysis in relation to the proper approach in the relatively unusual circumstances in which proceedings are brought by two different Claimants who are domiciled and undertook business in different jurisdictions on the basis of arguments relating to both exclusive jurisdiction clauses and forum non conveniens. In relation to the former issue, the Court undertook a detailed analysis of the contractual relationships between the parties. Where, as is common in multi-party disputes, an exclusive jurisdiction clause is contained within an agreement, that should be construed by reference to the overall scheme of the agreements. Where the jurisdiction clause is in an agreement which is at the centre of gravity of the scheme, it is more likely to apply to the package of agreements as a whole. Where, however, it is to be found in an agreement which is at the periphery of the dispute, however, even if a Claimant is bound by it, the Court should not necessarily accede to a jurisdiction challenge in another jurisdiction, where doing so would result in fragmented litigation across different jurisdictions. In relation to questions of forum conveniens in multi party litigation, the Court should look through to the core of the dispute and focus on what that core means as regards the appropriate jurisdiction. Having done so, relevant factors for the court to consider are the location at which the relevant events occurred, the domicile of the parties and the language in which the relevant documents were written.

What was the background?

The Defendant (“SocGen”) alleges professional negligence against the Claimants (collectively, “Clifford Chance”), being LLPs providing legal services in England and Wales and France respectively. SocGen was founded and is headquartered in France. Clifford Chance first issued these proceedings in England and Wales seeking declarations that they are not liable to SocGen for professional negligence and were not retained by SocGen at all. SocGen subsequently issued proceedings in France for professional negligence seeing damages in excess of €140 million. The first hearing of the claim in France is due to take place in March 2024. SocGen applied to challenge the English Court’s jurisdiction to hear this claim on two bases. First, that it falls within an exclusive jurisdiction clause in favour of the High Court of Paris. Second, the French and not the English Court is the most appropriate forum to determine this dispute.

What did the court decide?

The jurisdiction challenge was dismissed. The Court concluded first that the entity which had handled the relevant litigation to which the dispute related had principally been the LLP based in England and Wales and not the LLP based in France. Although the French LLP was bound by the jurisdiction clauses contained in the relevant agreements, given it was not the entity which provided the relevant legal services, the effect of those clauses was more limited. Preventing the French LLP from commencing proceedings in England and Wales would cause fragmentation of proceedings in circumstances in which the English LLP was not constrained by those same clauses. The first basis for challenge was dismissed. In relation to the second ground of challenge, namely the forum non conveniens arguments, the Court concluded that the substance of the core dispute was as to whether an English LLP and firm of solicitors had been negligent in the conduct of litigation in the High Court of England and Wales under a retainer governed by English law. Each of the relevant events in the dispute took place in England and the core documentation was in the English language. These would need to be translated as part of any proceedings brought in France. As a result, the appropriate forum was England and Wales and not France.

Case details

• Court: King’s Bench Division (Commercial Court)
• Judges: Mr Justice Henshaw
• Date of judgment: 27 October 2023

Article by Phillip Patterson – first published by LexisNexis