England and Wales Court of Appeal (Civil Division) Decisions

You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Lubbe & Ors v Cape Plc [1998] EWCA Civ 1351 (30 July 1998)
URL: http://www.bailii.org/ew/cases/EWCA/Civ/1998/1351.html
Cite as: [1998] EWCA Civ 1351, [1998] CLC 1559

[New search] [Printable RTF version] [Help]

		BAILII Citation Number: [1998] EWCA Civ 1351
		QBENI 98/0192/1

IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
(SIR MICHEL KALLIPETIS QC
(Sitting as a Deputy High Court Judge))

Royal Courts of Justice
The Strand
London WC2

30th July 1998

B e f o r e :

LORD JUSTICE EVANS
LORD JUSTICE MILLETT
LORD JUSTICE AULD
____________________

	(1) RACHEL LUBBE
	(2) NKALA JOHANNES MAILE
	(3) MATLANENG JOHANNES MOHLALA
	(4) CATHERINE EKSTEEN NEL
	(suing as Administratrix of the
	Estate of MATHYS CHRISTOFEL NEL)
	(5) SEBUSHI PAULINE SELWANA
	Appellants
	- v -
	CAPE PLC
	Respondents

____________________

(Handed down Transcript of Smith Bernal Reporting Ltd
180 Fleet Street, London EC4A 2HD
Tel: 0171 421 4040
Official Shorthand Writers to the Court)

____________________

MISS B DOHMANN QC and MR G READ (Instructed by Messrs Leigh Day & Co., London EC1M 4LB) appeared on behalf of the Appellants
MR S KENTRIDGE QC, MR B DOCTOR and MR COLEMAN (Instructed by Messrs Davies Arnold Cooper, London EC4Y 8DD) appeared on behalf of the Respondents
____________________

HTML VERSION OF JUDGMENT
____________________

(see: Lubbe and Others and Cape Plc. and Related Appeals [2000] UKHL 41 (20th July, 2000))

LORD JUSTICE EVANS: The issue raised by this appeal is whether an action brought by South African plaintiffs against the defendant company, which is incorporated and domiciled in England, should be stayed on grounds of forum non conveniens, in favour of proceedings which the defendant says the plaintiffs could commence against it in South Africa. The claim is for damages for personal injuries which were sustained in South Africa, caused over a long period during which, it is alleged, the plaintiffs were exposed to the risks of inhaling asbestos dust. Michel Kallipetis Q.C. sitting as a deputy judge of the High Court ordered a stay, and the plaintiffs now appeal.

Barbara Dohmann Q.C. counsel for the appellants submits alternatively that the stay is contrary to the Brussels Convention 1968 (Civil Jurisdiction and Judgments Act 1982) and that the matter should be remitted to the European Court of Justice for its ruling on whether the Convention applies. A ruling that it does apply would involve a departure from the decision of this Court in Re. Harrods (Buenos Aires) Ltd [1992] Ch.72.

The defendant's application was by Summons dated 7 March 1997 claiming :-

"3. A declaration that in the circumstances the Plaintiff's action should not be allowed to proceed on the principles of forum non conveniens."

The judge made the following Order dated 22 January 1998 :-

"AND UPON the Defendant giving the undertaking recorded in Appendix "A" hereto

IT IS ORDERED that :-

(1) All further proceedings in this action be stayed on the grounds that the appropriate forum for the trial of this action and the issues therein is the High Court of South Africa, ....".

Appendix "A" contained five numbered undertakings, the essential one being -

"(2) the defendant consents to these actions by these plaintiffs relating to Prieska, Koegs and Penge being heard together in any provisional division of the High Court of South Africa having jurisdiction in respect of them , provided that all cases of each of these Plaintiffs are brought in the same Court ; ....".

In other words, that the Defendant would submit to the jurisdiction of the High Court of South Africa, if the proceedings were brought there. Prieska, Koegas and Penge are the names of asbestos mines and mills in South Africa where local deposits of asbestos were exploited from the late 19th century until 1979, when the defendants ceased to have any connection with them. Prieska and Koegas are in the Northern Cape district. Prieska ceased operations and the area was "rehabilitated" in 1994. The Penge Mines which are in Transvaal closed in June 1992.

The forum non conveniens application is of course governed by the principles stated in The Spiliada [1987] 1 A.C. 460. Because the plaintiffs bring the proceedings in this jurisdiction `as of right', the defendant company being incorporated and domiciled here, the defendant has the burden of proving that South Africa is an "available forum which is clearly and distinctly more appropriate than the English forum" for the trial of the action (per Lord Goff at 477E). The judge held that the defendant succeeded in doing so, although his conclusion was expressed in the Order in apparently less restrictive terms ("the appropriate forum [is]").

A point was raised in the course of argument by Millett L.J. which was not relied upon before the judge and which introduces a factor which was not present or taken into account in Spiliada. The defendant company is not amenable to the jurisdiction of the South African Courts, save with its consent. This was the reason for the undertakings recorded in the Order.

We were given an agreed statement of South African law as to the jurisdiction of the High Court of South Africa in an action in tort (delict) brought by a resident (incola) against a non-resident (peregrinus). The requirements are (1) a ratio jurisdiction in the form of a cause of action arising (at least in part) within the area of the Court's jurisdiction, and (2) an arrest of the person or attachment of property (no matter how small) ad confirmandum jurisdictionem, or failing that a submission by the defendant to the Court's jurisdiction. There is said to be "no common law jurisdiction of forum conveniens in South Africa" which we take to mean, for present purposes, that there is no basis for extending the jurisdiction extra-territorially as the English Courts do under R.S.C. Order 11. We are told, finally, that jurisdiction must exist at the time when the action is instituted by issue of Summons.

The first requirement is satisfied in the present case, or so it would seem, but the second is not. The defendant company does not carry on business in South Africa and it has no assets there, or none which are liable to attachment or have been attached. Hence the undertaking to submit to proceedings, if and when they are issued. Without it there would be no basis on which South African jurisdiction could be exercised. This undertaking enables the defendants to contend that the South African courts are "available" to the plaintiffs for the purposes of the Spiliada principles. The undertaking was first offered during the hearing before the judge and therefore came after the defendant's summons was issued ; a matter of timing which may be relevant to the question whether it should be taken into account.

Background

The judge's summary can be quoted in full. Following the discovery of blue asbestos near Prieska in South Africa,

"It was a Cornish engineer named Frances Oates who was the driving force behind a consortium formed to mine the asbestos at the end of the 19th Century and in 1893 this cave birth to the predecessor of the defendant company The Cape Asbestos Company Limited ("London Cape"). Their operations centred on mines at Prieska and Koegas.

From its inception, the English company established a local agency to run the South African operations and appointed local directors to operate under regulations drawn up by the English company. Francis Oates was among the first of the local directors to be appointed and later that same year he was appointed as a director to the Board of the English company. The Defendants claim that the English company did not concern itself with the actual mining operations but merely owned the land and the mineral rights over the land and paid anyone who brought mineral fibre to its store. This appears to have been the pattern in the early days, according to the potted history reproduced at E/47 of exhibit "RM1".

Another development which may have some relevance in view of a late application by the Plaintiffs, was the acquisition of an Italian factory near Turin in 1894 to experiment in the manufacture of goods from Cape Blue. These operations were funded from London and the history of the company (E/52) describes the position thus : "After a year the company had little to show financially, but it had its two legs firmly planted in South Africa and Italy, a virile system of arteries running from London to many countries abroad, and an energetic leader in the shape of the peripatetic Mr Oates" There then follows on that page an extract from his speech to the shareholders in which he extols the virtues of the company and the operations in mining and manufacturing of blue asbestos.

The Boer War interrupted the mining of Cape Blue until 1903 and by 1905 the mine at Prieska was in full operation. In 1914 brown asbestos, called Amozite was mined in Penge, named after the London suburb. In 1916 Egnep Limited and Amosa Limited were registered to exploit the deposits of brown asbestos or amosite at Penge. London Cape bought amozite and processed it at its factory in Barking, Essex. In the early 1920s London Cape contemplated acquiring the mines at Penge, but the depression intervened and it was not until September 1925 that London Cape acquired both Egnep and Amosa.

After the Second World War the demand for asbestos increased. The Cape Blue mining operations were run from Kimberley by the local Board of Directors established in 1894 and the amozite mining at Penge was run by Egnep from Cape Town. It is not disputed that up to 1948, London Cape controlled the operations in South Africa.

In 1948 two new companies were formed : Cape Asbestos South Africa (Pty) Limited ("CASAP") a subsidiary of London Cape as a holding company, and Cape Blue Mines (Pty) Limited to acquire the Cape Blue mining assets. A Mr Riley was sent out from London to take up a permanent appointment controlling the whole of London Cape's asbestos operations in South Africa. He retained his seat on the Board of Cape London and reorganised the structure of the South African companies by transferring them all to Johannesburg.

By the end of the Second World War London Cape controlled the whole operations of asbestos production from "mine to manufacture" through a host of subsidiary companies. At E/78 is a family tree of the Cape organisation which is described in more detail at pages E/72 to 108.

The 1948 reorganisation, claimed the Defendants, resulted in the cessation of Cape London's control of operations in South Africa and the resumption of total control and thereby legal responsibility, by CASAP which is a wholly owned subsidiary of Cape London. The defendants allege that day to day control of each mine was entirely in the hands of local management. The Plaintiffs rely on the part played by Mr Riley to demonstrate that there was still a vital element of control by Cape London. The precise nature of the control if any exercised by Cape London over the South African subsidiaries is very much in issue but I do not have to decide that matter on this application."

Plaintiffs

Again, the judge's summary can be quoted here :-

"Mrs Lubbe : She lived in the area of Koegas and Prieska mines. Unfortunately since the inception of this action and just before the hearing of the application she died. No point is taken by the Defendants and I am asked to consider her case along with the others on the basis that her husband will subsequently have himself substituted as Plaintiff on behalf of her estate.

Mr Maile : worked at the Penge mine and lived in the mine hostel. It is alleged that at all times both while working in the mine and while living in the mine hostel he was exposed to asbestos dust and fibres.

Mr Mohlala : worked at the Penge mine from the age of 12 packing asbestos fibre with his bare hands for some 14 years during which he also lived in the mine hostel.

Mrs Nel : The wife of Mr Nel who died in November 1995 from mesothelioma. It is said that he lived in the environment of the Prieska mine and mill and was exposed to the asbestos dust fibres in the atmosphere.

Mrs Selwana : worked as a servant for a family living at the Penge mine and was exposed to asbestos dust and fibre in the atmosphere. She also washed the overalls of her husband who worked in the mine and thereby it is said was further exposed to asbestos dust and fibres".

Allegations in Statement of Claim

The plaintiffs allege that the defendant company "operated and/or had responsibility for, inter alia, asbestos mines and mills in South Africa from which asbestos was mined and milled and a substantial proportion of which asbestos was transported to and used in factories in the United Kingdom which factories the Defendant Company operated and/or had responsibility for" (paragraph 1.2). Further facts are alleged in paragraph 2, including, with reference to the three named sites, "the Defendant company operated and/or had responsibility" for them either itself or through wholly owned subsidiaries (paragraphs 2.7 and 2.8). Particulars are given of the individuals who acted on behalf of the defendant and whose knowledge should be attributed to it, including knowledge of the alleged risks involved in the asbestos processes. The alleged duty of care is pleaded in paragraph 5, arising because the defendant "operated or had responsibility for "processes" either directly or through its wholly owned subsidiaries". The alleged breaches include negligently allowing the plaintiffs to be exposed to asbestos dust and fibres (paragraph 12).

Italian action

Reference is also made to an action commenced by Writ issued on 3 October 1997 against the defendant by four Italian plaintiffs claiming damages for personal injury. They worked in or lived near the Turin factory similarly operated by the defendant, it is alleged, either directly or through a subsidiary. The same allegations are made as in the present action, and the fact that the Italian action is pending is a reason, the plaintiffs submit, why the present actions should not be stayed. The Italian action cannot be stayed, because the defendant company is domiciled here and so is rightly sued by Italian plaintiffs in the English court, under the Brussels Convention Article 2. Mr Kentridge submits that the existence of separate proceedings is wholly irrelevant to the defendant's application in this case.

Issues

The judge stated the issues as follows :-

"(1) Did each of the Plaintiffs suffer the injuries of which they complain?

(2) Were these injuries caused by inhalation of asbestos dust and fibre present in the atmosphere where they worked and lived?

(3) Did that asbestos dust and fibre escape from the mines and mills at Prieska, Koegas and Penge?

(4) Were the companies which ran those mines and mills liable in law to each Plaintiff for the escape of asbestos dust into the atmosphere? This can effectively be broken down in legal terms to the following two questions :-

(a) Did those companies owe a duty to those living and working in the vicinity of the mines and mills? and

(b) Did those companies or any of them commit breaches of that duty?

(5) Is Cape London liable in law for the breaches of duty by the South African companies?

His conclusions were set out after a lengthy review of the authorities which were cited to him. He held that "questions (1) to (4) are governed by South African law and the answer to them has its closest and most natural connection with South Africa", referring to a list of connecting factors to England and South Africa respectively which counsel placed before him (paragraph 16). He then referred to the plaintiffs' submission that the defendant owed a duty "to anyone worldwide who foreseeably might be injured by the negligent escape of asbestos dust into the atmosphere" and to various factors affecting the relative convenience of trials in South Africa or England. He said :-

"It does seem to me that this is an action, which given the modern methods of communication could be tried either in South Africa or in this jurisdiction. However that is not the question with which I am concerned. I have to decide which jurisdiction has the most natural and closest connection with the causes of action raised in the Statement of Claim". (paragraph 17).

His overall conclusion was :-

"In my discretion I have to decide not which is the more convenient forum for the purposes of the parties but which is the most natural forum for the trial of this action. On balance it seems to me that everything in this action points to South Africa as the most natural forum for the trial of this action. If there is the duty contended for by Mr Johnson upon the English company it seems to me that that can easily be litigated in South Africa. All the other matters, notably those listed in issues (1) to (4) above, quite clearly in my judgment have their closest and most significant connection with South Africa which is the most natural forum for the trial of those issues. In all the circumstances in exercising my discretion I am satisfied that the Defendants have discharged the burden upon them and therefore I would grant the stay under the first limb in Spiliada."

Submissions

Miss Dohmann's submission can be summarised, I hope accurately, under three heads. First, the plaintiffs do not allege that the defendant is liable for breaches of duty by the South African companies (the judge's issue (5)). They allege that the defendant is liable for breaches of a duty of care owed by it to classes of person including the individual plaintiffs. Secondly, that duty arose under English law and in England, and the breaches of it for which the defendant is responsible, whether by its directors or senior personnel, occurred for the most part in England, where board meetings were held, policy decisions made and instructions given. The judge was wrong, she submits, to identify those factual allegations with South Africa. Thirdly, she relies on the "available forum" point which was not taken before the judge.

Mr Kentridge Q.C. for the defendant submits that the judge was right, essentially for the reasons he gave. The plaintiffs suffered their alleged injuries in South Africa in consequence, they say, of physical conditions there. The judge was right to hold that essentially the factual allegations are based in South Africa and that convenience dictates that the trial should be held there. The question whether the defendant owed the duty of care alleged by the plaintiffs is likewise governed by South African law. The South African courts are an "available forum," for the plaintiffs, because the defendant is willing to submit to their jurisdiction, and the fact that such submission is necessary has not given rise to a similar objection in any reported case, in particular Connolly v. R.T.Z. plc and Tulloch v. Williams (1846) 8D 657 where the point could have been taken, but was not.

Authorities

The judge referred to the authorities which were cited to him under four heads vis. The Asbestos Cases, The Forum Conveniens Cases, The Liability of Parent Company Cases and The question of Legal Aid (ref. Connelly v. RTZ Corp. plc (House of Lords). Legal aid apparently is available to the plaintiffs, and that factor is not relied upon in the present case (judgment para. 13.2). The `Liability of Parent Company Cases' likewise are not relevant to the appeal, because Miss Dohmann accepts, indeed she asserts, that the plaintiffs do not allege that the defendants are responsible for the acts of their subsidiary companies in South Africa, whether vicariously or on some other ground which might otherwise be suggested, for example, by submitting that the Courts should `pierce the corporate veil' in the circumstances of this case. The plaintiffs allege that their injuries were at least partly caused by negligence of the defendant company itself, through its directors and employees. As stated above, Miss Dohmann submits that the judge misunderstood the nature of the allegations, confusing them with some form of vicarious responsibility for the acts of agents or subsidiaries in South Africa, and that this led him to the wrong conclusion, that the plaintiffs' claims against the defendants are governed by South African law.

It is unnecessary in my judgment to refer to any of the forum conveniens cases except Spiliada and also a more recent Privy Council decision in Red Sea Inc Company Ltd v. Bouygues S.A. [1995] 1 A.C. 1990, on appeal from the Supreme Court of Hong Kong. The judgment of Lord Stynn includes the following passage :-

"The law of England recognizes that a particular issue between the parties to litigation may be governed by the law of the country which, with respect to that issue, has the most significant relationship with the occurrence and with the parties. They agree with the statement of Lord Wilberforce at page 391 to 392, which has been set out above as to the extent of an application of the exception. they accept, as he did, that the exception would not be successfully invoked in every case or even, probably, in many cases, and at page 391H, that "the general rule must apply unless clear and satisfying grounds are shown why it should be departed from and what solution, derived from what other rule, should be preferred.""

The Asbestos cases are relevant because they show, first, how claims for personal injuries caused by exposure to asbestos dust have been handled by the English Courts (Smith v. Asbestos Industries Ltd [1971] 3 All E.R. 204 (C.A.) and Margereson v. J.W. Roberts Ltd (1966) P.I.Q.R. 358 (Holland J. and C.A.)) and in Western Australia( Barrow and Others v. C.S.R. Ltd 4 August 1988, Supreme Court), and secondly, how related procedural and jurisdictional issues have been handled by the courts. These cases are Ngcobo v. Thor Chemical Holdings Ltd (C.A. 9 October 1995, unreported) and Adams v. Cape industries plc [1990] 1 Ch.473 and Durham v. T & N plc (C.A. 1 May 1996, unreported).

The present defendants were parties to the second of these, Adams v. Cape Industries plc, being joined as the parent company of subsidiaries who were defendants in an action brought before the U.S. District Court of Texas. Although the claims arose out of the supply of asbestos fibres mined in South Africa, the judgments of Scott J. and the Court of Appeal were concerned with the enforceability of the judgment of the United States Court and with the non-liability of a parent company for the action of its subsidiaries. They therefore are not relevant to the issues now raised.

Both Ngcobo v. Thor Chemical Holdings Ltd and Durham v. T & N plc, however, should be referred to in greater detail. The plaintiffs in Ngcobo were admittedly exposed to hazardous and unsafe quantities of mercury, mercury vapour and mercury components in the course of their employment in South Africa by a South African company whom they could not sue, by reason of the provisions of the South African Workmans Compensation Act 1941. "In short, the Ngcobo Plaintiffs alleged that the defendants had developed an unsafe plant and system of work in England, exported it to South Africa and thereafter commissioned it and operated it knowing it to be hazardous to the workmen employed there." The alleged torts were committed in South Africa. Mr Recorder Stewart Q.C. sitting as a deputy High Court Judge was not persuaded to grant a stay. The defendants' appeal was struck out on procedural grounds. The judge in the present case rightly regarded this as an important decision, and of some assistance to the plaintiffs, but the facts can be distinguished and for present purposes I do not give it any significant weight.

The facts in Durham v. T & N plc are to some extent parallel with those in the present case. The plaintiff was an injured Canadian employee of a subsidiary company of the defendants ; they were "the parent company of a multinational group with extensive experience of resisting asbestos related claims in the Unites States and elsewhere" (judgment page 4). The case was pleaded as "a straightforward claim in tort for personal injuries against an employee or occupier of premises" (page 6). Even making the assumption that the defendant company rather than the subsidiary should be regarded as the plaintiff's employer and occupier of the factory, nevertheless the law of Quebec was the governing law of the alleged tort and the action was precluded by the provisions of Quebec law. The plaintiff's appeal was dismissed, by a Court of which I was a member. The decision was as to the governing law of the torts which were alleged, and the plaintiffs in the present case make entirely different allegations as to the basis on which they say the defendant is liable to them.

Also relevant, in my judgment, are the authorities which establish the principles of comparative law (private international law) which determine the proper law of a tort committed either partly or wholly outside the territorial jurisdiction of the English Court ; strictly, what system or systems of municipal law govern the question whether acts committed outside England and Wales give rise to liabilities in tort. Where the composite acts which together constitute a tort under English law took place in different jurisdictions, then the Court must identify the substance and decide accordingly what system of law governs the tort: Metall and Rohstoff A.G. v. Donaldson Luftkin & Jenrette Inc [1990] 1 Q.B. 391 and see Distillers Co. Ltd v. Thompson [1971] AC 458 :-

"The right approach is, when the tort is complete, to look back over the series of events constituting it and ask where in substance did this cause of action arise?" (per Lord Pearson at 468E)

Allied to this is the so-called `Rule in Phillips v. Eyre' which in the light of Boys v. Chaplin [1971] A.C. 356 is summarised in Dicey & Morris, The Conflict of Laws 12th ed. (1993) as follows :-

"Rule 203 -(1) As a general rule, an act done in a foreign country is a tort and actionable as such in England, only if it is both

(a) actionable as a tort according to English law, or in other words is an act which, if done in England, would be a tort ; and

(b) actionable according to the law of the foreign country where it was done.

(2) But a particular issue between the parties may be governed by the law of the country which, with respect to that issue, has the most significant relationship with the occurrences and the parties."

The House of Lords' decision in Boys v. Chaplin illustrates the application of sub-rule (2) and is consistent with the passage from the judgment in Red Sea Inc. Company Ltd. v. Badges S.A. which I have quoted above. (See now the Private International Law (Miscellaneous Provisions) Act, 1995.)

The plaintiffs' claim re-formulated

Faced with the imprecise wording of the Statement of Claim, which alleges that until 1978/9 "the defendant company operated and/or had responsibility [through its subsidiaries] for the mines and mills" in South Africa (para. 2.8) coupled with a later reference to "its control over asbestos and asbestos related products, from mining to sale" (para.5.1), and with her concession that the defendant company was sought to be held liable for its own tortious acts, rather than liable for its subsidiaries', Miss Dohmann re-formulated the plaintiffs' central allegation as follows :-

"Whether a parent company which is proved to exercise de facto control over the operations of a (foreign) subsidiary and which knows, through its directors, that those operations involve risks to the health of workers employed by the subsidiary and/or persons in the vicinity of its factory or other business premises, owes a duty of care to those workers and/or other persons in relation to the control which it exercises over and the advice which it gives to the subsidiary company?"

Governing law

The Spiliada judgment refers expressly to "the law governing the relevant transaction" as one of the factors determining whether the alternative foreign forum is "clearly and distinctly more appropriate" than England (pp. 477E and 478A). Naturally, therefore, both Miss Dohmann and Mr Kentridge made submissions to us as to whether English or South African law governs the tortious liability which the plaintiffs allege against the defendant. There are strong arguments in favour of each. Miss Dohmann emphasises that the negligence alleged against the defendant company, which acted through its directors and senior employees, consists of instructions and advice which they gave, or failed to give, to their South African employees and to the South African subsidiaries who operated the mines and mills, in the course of carrying on business internationally, there and elsewhere. The instructions and advice, it is alleged, showed a careless disregard for the foreseeable risks of injury to those who were closely affected by the asbestos operations in South Africa, taking account of the knowledge which they had or ought to have had of the health risks involved. These matters were determined at Board or a senior level in England as part of company policy and they were implemented by directors and senior personnel in England and elsewhere, including South Africa during regular visits there. She submits that the question whether the defendant owed a duty of care at this level towards individual workmen centres upon decisions made and activities undertaken in England, and should be governed by English law. Moreover, considerations of English public policy are involved in deciding whether or not a duty of care should be imposed in a given set of circumstances : Caparo Industries v. Dickman [1990] 2 A.C. 650 passim. The English Courts are the correct forum to decide such matters : Du Pont v. Agnew [1987] 23 Lloyd's Rep. 585 at 594/5.

Mr Kentridge on the other hand submits that the claim has its closest and real connection with South Africa. The claims are "quintessentially fact-based" (skeleton argument para.21). They are for injuries allegedly suffered by individual plaintiffs by reason of their physical exposure to asbestos dust in the vicinity of the mines and mills. The suggestion that the defendant formulated its policy in England takes the matter no further ; the plaintiffs were not injured by the formulation of policy, but by exposure to asbestos dust in South Africa. Apart from the defendant's incorporation and domicile in England, "none of the legal or factual issues in this case are connected with England" (skeleton argument para.24.1), and for the same reasons "English law is likely to be the law of the alleged tort or at least a substantial element" (ibid. para.26).

In short, Miss Dohmann submits that the defendant owed the plaintiffs a duty of care in respect of their activities which took place largely in England, whilst Mr Kentridge relies rather upon the alleged consequences of breaches of the duty, which occurred in South Africa, and on the nature of the individual claims. From the point of view of individual plaintiffs, breach, causation and injury all took place in South Africa, and policy decisions made in London or instructions which emanated in London but which took effect in South Africa were remote from them.

These submissions overlap the question whether factual issues may be more conveniently heard in South Africa than in London, and in my judgment it is right to pause in order to consider what weight the governing law factor has in this case.

The judge said this :-

"The Plaintiffs, or their deceased relatives on whose behalf they sue, all contracted one form or another of mesothelioma. It is against this background that I turn to the application before me. At the heart of the action is the question of whether or not Cape London has any liability in law for any injuries which the Plaintiffs may subsequently prove that they sustained as a result of inhaling asbestos dust in the atmosphere in South Africa. This may well be a difficult question for the Plaintiffs to prove but it is not one which is before me and not one that I have to decide.

Although it was accepted by both Counsel in the course of their submissions that the question of whether or not a duty was owed was not one for me, nonetheless a great deal of the argument by each Counsel has been directed to this question. In deference to the weighty arguments advanced by both sides I shall attempt to deal with as many of the matters as I think are relevant for the decision that I have to make but I trust that both Counsel will forgive me if I do not repeat in this Judgment every single matter that they have raised and every single submission."

Having defined the issues as already stated above, he then held that questions (1) to (4) "are governed by South African law and the answer to them has its closest and most natural connection with South Africa" (para. 16). He did not state any conclusion as regards question (5), but he added this when considering the general issue of appropriate forum :-

"In effect the Plaintiff contends that the duty is owed by an English company to anyone worldwide who foreseeably might be injured by the negligent escape of asbestos dust into the atmosphere" (para.17)

The reference to a "world wide" tort is taken up in the defendants' skeleton argument where Mr Kentridge submits :-

"38. The duty of care, if it existed, did not exist in England. If it has a locus, it must be where the person who falls within its ambit is situated" (citing Caparo v. Dickman per Lord Oliver at 651).

In my judgment, this submission confuses two separate questions. First, what law governs the tort alleged in a particular case? Secondly, what was the location of the constituent elements of the tort? As already observed from the Metall und Rohstoff judgment, the law governing the tort depends upon the location of its substantial elements, but this does not mean that the duty of care exists in a particular place. The most that can be said is that one system of law rather than another will govern the alleged liability of the tortfeasor towards the injured claimant, wherever they may be situated, and even this is subject to the possibility that, under English law, an individual issue may be determined by a different system from that which otherwise governs the tort.

The submissions demonstrate that there is much room for argument as to whether on the alleged facts the defendant company owed a duty of care to individuals who lived in the vicinity of the mines and mills in South Africa, whether under English or South African law, and as to which law applies to the alleged tort or, possibly, to that issue. This is a substantial question of law, not suitable for determination in these proceedings to have the action stayed. The plaintiffs have suggested that it could be tried as a preliminary issue, but the defendants do not agree, and the judge felt unable to direct a trial of the issue without their assent. In these circumstance, it would be wrong in my view to make any assumption as to what is or is likely to be held to be the governing law of this transaction. Furthermore, it is an issue of law which can be decided in either South Africa or England, although prima facie the allegation of a common law duty of care owed by an English defendant, albeit to a class of persons situated overseas, should more appropriately be decided by the English Courts.

Although he gave no express ruling, the judge indicated in the passages referred to above that in his view the defendant's alleged liability is governed by South African law, and if he did so, then in my judgment he misdirected himself. It is an open issue, and at best for the defendant a neutral factor in the circumstances of this case.

Moreover, I would accept Miss Dohmann's submission that the judge's formulation of issue (5) was incorrect. As already explained, the plaintiffs do not allege that the defendant is "liable in law for the breaches of duty by the South African companies" : no form of vicarious liability is relied upon. The difference is important, because the alleged breaches of an independent duty of care owed by the defendant took place in England rather than in South Africa.

I should add two further comments, although these were not developed in argument. First, the issue whether a duty of care was owed by the defendant, in England, may be governed by English law, even if the other factors making up the alleged tort of negligence are governed by South African law : the kind of hybrid situation envisaged by Dicey and Morris' Rule 203(2).

Secondly, it seems to me that the role of the South African companies as operators of the mines and mills is of limited relevance to the allegations made against the defendant. Even if it is assumed that all South African regulations were complied with, and even that the operations were in no way unlawful under South African law, the allegation of negligence remains. Where business is carried on in this country, the fact that statutory regulations were not breached does not mean that the defendant was not negligent, although if the regulations take account of contemporary knowledge then it is clear evidence that reasonable standards were achieved : Budden v BP & Shell (C.A. April/May 1980). A fortiori where it is alleged that the defendants were situated in England and ought reasonably to have taken account of scientific knowledge that was available to them here.

Convenience, etc

The judge referred comparatively briefly to factors such as the availability of witnesses and documents, the convenience of the parties and their representatives as well as witnesses and suggested differences between South African and English court procedures. He concluded that "this is an action which, given the modern methods of communication could be tried either in South Africa or in this jurisdiction" (para.17). He did not refer to a suggested "Cambridgeshire factor" (the availability in London of experienced personnel and relevant documentary records, by reason of other litigation, here including the pending Italian action) but I would not regard that as a significant factor in the present case. He appears to have placed some reliance on the fact that a South African judge could more readily carry out a site inspection, which I would have discounted, because (1) the mines are now closed and the sites "rehabilitated", (2) an English judge could, if necessary, travel to South Africa for the same purpose, albeit at much greater expense, and (3) the trial judge's findings of fact will depend upon the evidence that is put before him in the court-room, wherever that may be. None of these comments, however, comes close to providing grounds for differing from the judge's exercise of discretion, so far as the convenience factor is concerned.

The judge's decision

This is contained in paragraph 19, which I have quoted above. There is some force, I think, in Miss Dohmann's submission that the question which the judge asked himself was not the correct one, given that the plaintiff can invoke the English Court's jurisdiction as of right : it should be, is South Africa nevertheless shown "distinctly and clearly" to be the more appropriate forum? It is not enough, she submits, that South Africa is "the most natural" forum or that the issues can easily be litigated there. This particular criticism, however, is little more than semantic, and it should not be given undue weight.

Available forum,

The judge referred to the need for the defendant company to submit to the jurisdiction of the South African court, before that forum could become `available' to the plaintiffs, but only as a "potential difficulty", equivalent to different rules as to discovery, etc, which was removed by the undertakings offered by the defendant and subject to which the Order staying the proceedings was made (see page 49).

In my judgment, the difficulty is greater than this. The question is, whether the courts of another country can be said to offer an "available forum" to a plaintiff who cannot bring proceedings there, without the defendant's consent. Clearly not, at the time when the plaintiff brings proceedings in England, unless the defendant has already indicated his willingness to be sued there, whether in reply to a letter before action or for some other reason. If the relevant time is when the defendant's Summons is issued (cf.Mohammed v. Bank of Kuwait [1996] 1 W.L.R. 1483), then the requirement was not satisfied in the present case : the undertakings were suggested or offered subsequently, when the Summons was heard.

Putting aside these technical objections, it can be said that the defendant's offer only becomes relevant if the Court finds that the forum in which he indicates his willingness to be sued is "clearly and distinctly" more appropriate for the hearing of the action, "in the interests of both parties and the ends of justice". Viewed in this light, the defendant's offer can be seen as contributing towards those ends.

But the effect of treating the foreign jurisdiction as available to the plaintiff in these circumstances is to give the defendant a choice of jurisdiction, if he is sued in England. He can accept that jurisdiction, if it suits him to do so, or he can elect in favour of the foreign jurisdiction, if that appears more favourable for him. The latter presumably is the situation here. It becomes almost a case of forum shopping in reverse, and it was the English Court's reluctance to allow plaintiffs to choose an inappropriate jurisdiction when more than one forum was available to them which led to the disinterested approach based on doing justice to both parties which underlies the Spiliada judgment.

Seeking therefore to give a principled answer to the question whether a foreign jurisdiction can be regarded as available to the plaintiff, when its availability depends on the defendant submitting to it, it seems to me that there could be extreme cases where the defendant is sued "as of right' in a jurisdiction which has no connection whatsoever with the subject-matter of the dispute and where the foreign jurisdiction in question is "clearly and distinctly" the only one which could be regarded as appropriate in the circumstances. Even in such a case the plaintiff might seek, not unreasonably, to obtain a judgment in England which could more readily or more effectively be enforced against the defendant or his assets, and so I will say no more than that such a case could perhaps exist.

But that is not the situation here. There are factual connections with England. Indeed, Miss Dohmann submits that the central allegations relate to the defendant's activities in this country, although its business was carried on directly or through subsidiaries abroad. The judge in my view did underestimate the extent to which factual issues arise here in this country : he said that there were none, apart from the presence of the defendant company, when clearly there are some. It is not the extreme case, in my judgment, where possibly the defendant's choice of jurisdiction should be allowed to prevail.

Under the heading "Submission as a basis of jurisdiction", Mr Kentridge contends that the jurisdiction of a foreign court only becomes effective when the plaintiff chooses to invoke it, and that that forum is "available" to the plaintiff when the defendant agrees or has agreed to submit to it, in the event that the plaintiff issues proceedings there. There is no distinction, he submits, between an undertaking which precedes the issue of South African proceedings and a previous contractual agreement to the jurisdiction of a foreign court. A jurisdiction clause, he submits, which, although not a submission `in the face of' the foreign court, nevertheless is evidence of a submission to it (supplementary skeleton para. 11) and will be accepted as such.

In my judgment, a different principle governs the effects of an exclusive jurisdiction clause. It founds jurisdiction as a matter of discretion in England (Order 11 Rule 1(1)). In South Africa, as I understand Mr Kentridge's submission, it is treated as equivalent to a submission to the jurisdiction, when the jurisdiction is invoked. The latter may mean that the plaintiff in South Africa is able to issue proceedings "as of right" when the defendant's prior acceptance of the jurisdiction is evidenced in that way. But when there is no prior agreement, the plaintiff cannot make any such claim. Whether the Court's jurisdiction will become effective depends upon the willingness of the defendant to submit to it : the antithesis of jurisdiction asserted "as of right".

Lord Goff's speech in Spiliada includes the following :-

"(c) The question being whether there is some other forum which is the appropriate forum for the trial of the action, it is pertinent to ask whether the fact that the plaintiff has, ex hypothesi, founded jurisdiction as of right in accordance with the law of this country, of itself gives the plaintiff an advantage in the sense that the English court will not lightly disturb jurisdiction so established. Such indeed appears to be the law in the United States,where "the court hesitates to disturb the plaintiff's choice of forum and will not do so unless the balance of factors is strongly in favour of the defendant," : see Scoles and Hay, Conflict of Laws (1982), p.366, and cases there cited ; and also in Canada, where it has been stated (see Castel, Conflict of Laws (1974), p.282) that "unless the balance is strongly in favour of the defendant, the plaintiff's choice of forum should rarely be disturbed." This is strong language."

He then considered English and other authorities which demonstrated a "more neutral position" (p.477A), and proceeded to state English law in terms of the "clearly or distinctly more appropriate" test. He added "In this way, proper regard is paid to the fact that jurisdiction has been founded as of right," citing Lord Salmon's speech in MacShannon [1978] A.C. 795 sc. at pp. 819-820.

It can be said, therefore, that due weight is given to the plaintiff's ability to bring proceedings in England`as of right' by the application of what is called stage 1 of the Spiliada test. If this is correct, then that same right is not a `juridical advantage' of the kind which makes the stage 2 test relevant also. I mention this because the judge's passing reference to the defendant's willingness to submit to South African jurisdiction was in the context of considering whether stage 2 arises in this case (judgment para.20). That might make it necessary to consider whether the plaintiffs acted reasonably in bringing their action here. If that is a relevant consideration (I do not say that it is) then there is nothing inherently wrong or unreasonable in bringing proceedings in England against an English defendant in respect of alleged negligence committed for the most part in this country, even though having its injurious effects abroad.

The fact that this point was not taken in the cases cited by Mr Kentridge, including Sarrio v. Kuwait Investment Authority [1996] 1 Ll.R. 650, should not deter this Court, in my judgment, from applying the principles correctly now

Overview

The plaintiffs bring these proceedings "as of right" meaning that they invoke the territorial jurisdiction of the English Court over a defendant who is resident (incorporated and domiciled) here. The Court has a discretionary power to refuse to entertain the proceedings, which may be stayed in accordance with Spiliada principles. Those principles, based primarily on Scottish authorities, give priority to "the interests of both parties and the ends of justice" over the plaintiff's right to choose a forum and, I would add, over the right to choose which the Courts allow to the defendant if the availability of an alternative foreign forum depends upon the defendant's willingness to submit to that jurisdiction.

The question whether a foreign forum is clearly and distinctly more appropriate for the trial of the action cannot be answered without first identifying the subject-matter of the action - what the trial will be about.

Where as here the claim is land-based, the plaintiffs alleging that they were injured by industrial activities in the area where they lived and worked, then the same territorial principle which enables the defendant to be sued `as of right' in the courts of the country where it is based means that there are strong and often compelling reasons why the action should be heard in the local courts.

But there is a strong countervailing factor also. The defendant company is alleged to have "controlled" the operation of the mines and mills in South Africa, meaning that its directors and senior personnel were responsible for the decisions which led to the business being carried on in the way that it was, in terms of policy and instructions to the local workforce rather than the day-to-day implementation of those policies and instructions. The decisions were taken in England and communicated to South Africa. If modern communications had been available, there would have been less need for personal visits. The alleged breaches of duty occurred essentially in England, although their effects were felt by the plaintiffs in South Africa where the decisions were implemented.

At this point, it seems to me, the international nature of the defendant company's alleged interests becomes relevant. It is said to have started asbestos production facilities in Italy and in this country and to have marketed the products worldwide. This was of no concern to individuals in South Africa or to others who may or may not have suffered similarly in other countries. But the allegations which the plaintiffs make in this action, and likewise the plaintiffs in the Italian action, are directed to what the defendants did here. It seems to me that that is an important factor to take into account when deciding whether the defendants have discharged the burden of persuading the Court that precedence should be given to the overseas jurisdiction from which particular individual plaintiffs come.

Conclusion

The judge failed to give any weight to the fact that the negligence alleged against the defendant company is distinct from any allegations which might be made against the person or subsidiaries responsible for running their South African businesses from time to time. He took no account of the fact that a South African forum was and is unavailable to the plaintiffs until the defendant offered undertakings during the hearing before him, and it remains conditional upon them. If these factors are taken into account, I would hold that the defendants do not show that South Africa is so clearly and distinctly the more appropriate forum that the action here should be stayed, and I would allow the appeal accordingly.

The need for a European Court Ruling therefore does not arise.

LORD JUSTICE MILLETT: I agree.

LORD JUSTICE AULD: I also agree.

ORDER: Appeal allowed with costs. Leave to appeal to the House of Lords refused.

(Order not part of approved judgment)

_____________________