Jurisdiction and Disclosure: Key Lessons from Libyan Blue Bird for Air Transport Co LLC v Executive Authority for Special Flights

Overview

The recent High Court decision of Nolan J in Libyan Blue Bird for Air Transport Co LLC v Executive Authority for Special Flights provides a useful illustration of the Irish courts’ approach to applications for service of Irish proceedings out of the jurisdiction on foreign defendants. It also considers the effect of material non-disclosure arising in ex parte applications such as these and the application of the doctrine of forum non conveniens.

The dispute arose out of an aircraft leasing arrangement between two Libyan entities. The contract was subject to varying interpretations as to whether the Libyan or Irish courts had jurisdiction to deal with the dispute.

The plaintiff initiated proceedings in Ireland and obtained an ex parte order under Order 11 RSC allowing service of notice of the originating summons on the defendant in Libya. In turn, the defendant entered a conditional appearance and applied to set aside service.

The central issue before the court concerned the plaintiff’s failure to disclose that it had already initiated proceedings arising out of the same contract in Libya, some months prior to the application for service out of the Irish proceedings.

The court ultimately decided to set aside the service on the defendant.

Approach of the Irish Courts

In coming to that decision, Nolan J first considered the principles governing service out of the jurisdiction, referencing the decision in Analog Devices BV v Zurich Insurance Company. In that case, the Supreme Court emphasised that the international comity of the courts has long required that Irish courts examine such applications with “care and circumspection”, as they compel a foreign defendant to answer proceedings before an Irish court. The court judges the strength of the cause of action on a test of a “good arguable case”.

Nolan J noted that this was not a “summary or pro forma application” and should be sworn on an affidavit of the moving party not its solicitor. The order was discretionary and the fact that the proceedings came within one or more of the categories specified in Order 11 did not entitle the applicant, as of right, to succeed in the application.

Full and Frank Disclosure

Nolan J emphasised that in an ex parte applications such as this, made in the absence of the other side, the applicant had an obligation to make full and frank disclosure to the court of all relevant material (even material which was adverse to the position of that party). If it emerged that the obligation had not been complied with or that the affidavit grounding the application had been misleading, even if unintentionally, the court could set aside the order granting leave to serve out. A party who obtained the ex parte order, had the burden of demonstrating that the order was properly granted.

He referred here to Bambrick v Cobley. In that case, the court set out the factors to be considered when assessing whether non-disclosure justified setting aside an ex parte order. These include:

• The materiality of the undisclosed information.
• The culpability of the applicant in failing to disclose it.
• The overall circumstances of the case.

Application of the Law

Applying these principles, Nolan J concluded that the failure to disclose the Libyan proceedings had been clearly material. 
Given that the obligation on the court is to examine such applications with “care and circumspection”, knowledge that the plaintiff had already commenced litigation in Libya would likely have prompted significant questions from the judge hearing the ex parte application.

The plaintiff had also appeared multiple times before the Libyan courts in those proceedings. This fact seemed to be at odds with averments previously made to the Irish court, that should the Irish application be refused, the plaintiff would be left without a competent forum in which to pursue its claim and seek a remedy. 

Forum Non Conveniens

Although the court was satisfied to set aside service on the grounds of non-disclosure, Nolan J also went on to consider whether Ireland was an appropriate forum for the dispute. Referring to Trafalgar Developments Ltd v Mazepin, he reiterated that falling within one of the jurisdictional gateways under Order 11 RSC did not automatically entitle a plaintiff to serve Irish proceedings abroad. The court must also determine whether Ireland was a convenient forum.

In this case, several factors pointed away from Ireland as the appropriate jurisdiction. Both parties were Libyan entities, the aircraft was located outside Ireland, and related proceedings were already underway in Libya.

The plaintiff argued that systemic deficiencies in the Libyan judiciary rendered Libya an unsuitable forum. However, the court found that the expert evidence provided did not amount to the “clear and cogent evidence” required to demonstrate that substantial justice could not be obtained there.

Indeed, the plaintiff had itself chosen Libya as the initial forum for litigation. Accordingly, the court held that permitting the Irish proceedings to continue would risk forum shopping and the possibility of inconsistent judgments.

Conclusion

This decision highlights several important principles of Irish procedural law. First, parties seeking ex parte relief must comply with the strict obligation of full and frank disclosure. Secondly, the Irish courts will exercise caution before assuming jurisdiction over disputes with limited connection to the State. Finally, the judgment reinforces the Irish judiciary’s commitment to the prevention of forum shopping and the protection of the integrity of international judicial comity.

The judgment can be read in full here. 

Byrne Wallace Shields LLP acted for the defendant in this successful application to set aside service. For further information contact Jill Callanan of our Legal and Regulation Department.