United Kingdom: Giving Effect to Optional Choice of Court Agreements—Interpretation, Operation and Enforcement

Abstract

This chapter begins by explaining that respect for party autonomy is an important feature of the national common law rules and the European rules which together govern jurisdiction and choice of law in civil and commercial matters in the UK. The chapter considers the approach to optional jurisdiction agreements in the four main regimes which apply to determine jurisdiction: the BIR recast, the Hague Convention, the Lugano II Convention and the residual national rules. The chapter explains how the various regimes distinguish between exclusive and non-exclusive agreements. At common law, the starting point is to construe the express and implied positive and negative promises contained in the choice of court agreement. The key difference between exclusive and non-exclusive agreements is that while both contain a positive promise to submit to the jurisdiction of the chosen court, only an exclusive agreement also contains a negative promise not to sue anywhere else. When it comes to the effect of those promises, the unique feature of the English national rules (which are broadly mirrored by the Scottish national rules) is that jurisdiction is always discretionary. However, because of the respect for party autonomy, the courts will give effect to the promise to submit in a non-exclusive agreement unless there is a strong reason for not doing so. By contrast, it is only in the case of an exclusive agreement that suing in another jurisdiction amounts to a breach of contract. This means that remedies founded on breach of contract, including damages, anti-suit injunctions, and defences to the enforcement of judgments, should be available only where there is an exclusive jurisdiction agreement. The chapter also considers asymmetric agreements, which are usually optional in respect of one party, but exclusive in relation to another. Finally, the authors outline the potential impact of Brexit and possible ways forward.