England and Wales Court of Appeal (Civil Division) Decisions

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
HHJ SIMON BARKER QC (sitting as a Judge of the High Court)
[2015] EWHC 1063 (Ch)

		Royal Courts of Justice Strand, London, WC2A 2LL
		19/10/2016

Lord Justice Kitchin:

1. This is an appeal by the defendant, Mr Binstock, against the order of His Honour Judge Barker QC, sitting as a judge of the High Court, made on 8 May 2015, declaring that the court had jurisdiction to hear what has been described as the third claim of the claimant, JEB Recoveries LLP ("JEB"), and dismissing an application by Mr Binstock that the claim should be struck out on the ground that it was founded upon a champertous assignment.
2. There is also before the court an application by JEB for permission to amend its particulars of claim and for permission to rely upon the matters set out in those amended particulars of claim as fresh evidence on this appeal. After hearing oral submissions by Mr Mark Hardy, a member of JEB and who appeared with our permission on its behalf, and from counsel on behalf of Mr Binstock, we decided that the application to adduce fresh evidence must be refused. We indicated to the parties that we would give our reasons in our judgments on the other issues raised by the appeal, and that I shall do.
3. At the outset of the hearing of the appeal, Mr Hardy sought our permission to raise a yet further issue. As elaborated in written submissions filed, with our permission, after the hearing, Mr Hardy contends that by making and pursuing an application for security for costs and by taking certain other steps in the proceedings, Mr Binstock has submitted to the jurisdiction.

Legal framework

4. We are concerned in this appeal with the application of the rules of special jurisdiction for contracts laid down in Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters ("the Regulation").
5. Article 2(1) of the Regulation provides:

"Subject to this regulation, persons domiciled in a member state shall, whatever their nationality, be sued in the courts of that member state."

6. Article 3(1) of the Regulation provides:

"Persons domiciled in a member state may be sued in the courts of another member state only by virtue of the rules set out in sections 2 to 7 of this Chapter."

7. Article 5 of the Regulation, entitled "Special jurisdiction", provides, so far as relevant:

"A person domiciled in a member state may, in another member state, be sued:

(1) (a) in matters relating to a contract, in the courts for the place of performance of the obligation in question;

(b) for the purpose of this provision and unless otherwise agreed, the place of performance of the obligation in question shall be:

—in the case of the sale of goods, the place in a member state where, under the contract, the goods were delivered or should have been delivered,

—in the case of the provision of services, the place in a member state where, under the contract, the services were provided or should have been provided,

(c) if sub-paragraph (b) does not apply then sub-paragraph (a) applies."

The background

8. Mr Binstock is now 87 years old and in poor health. He is and has for many years been a businessman. His principal business interests are property and casinos, mostly in Marbella in Spain. Although born in London, he has not lived in this country since the 1970s. He has instead lived at various times in the Netherlands, Switzerland, Italy, Portugal, Spain and France. He claims that his main home is a property in Marbella and that his second home is a flat in Paris. He also spends a few months of each year in Buenos Aires.
9. Mr Binstock and his wife also own a property in Bearsted in Kent. He maintains that he bought this property so that he and his wife will have somewhere to live in the event that either of them decides to return here. He also says that at present it is in no sense his home.
10. JEB was incorporated in March 2014. It has three members, Mr Mark Hardy, Mr Peter Wilson and Mr Michael Stannard. Each of them has had business dealings with Mr Binstock extending over a number of years.
11. On 30 April 2014, each of these members executed a purported assignment to JEB of any causes of action, debts and other rights which he had against Mr Binstock, Mr Binstock's wife and any other entity with which Mr Binstock had at any time been connected. In addition, each of them undertook that should he receive any monies or assets from Mr Binstock or his wife then he would pass those monies or assets to JEB.
12. Conversely, the only obligation undertaken by JEB was to report to each member as to the progress of its efforts to pursue the various claims which had been assigned to it. But of course, each member was, through his membership, entitled to a share of the net proceeds of any such claim.
13. Some idea of the reasoning behind the incorporation of JEB may be gained from the second witness statement of Mr Hardy dated 19 March 2015 in which he claimed that Mr Binstock had made threats of violence against him, had circulated untrue reports about him and had interfered with contractual arrangements entered into by companies with which he was connected. He continued that he had met Mr Stannard and Mr Wilson and gathered that they too had suffered loss and damage as a result of the actions of Mr Binstock. So he decided to discuss with them the possibility of them cooperating to seek redress. As he put it at [14]:

"… Such joint or collaborative action was the only way that we could see to protect ourselves against [Mr Binstock's] further threats against us and members of our families if any one of tried to "go it alone"."

Accordingly, they agreed to form an LLP and to assign to it all debts owed to them by and all claims they had against Mr Binstock, his wife or any company or other entity connected to him.

The claims and the proceedings

14. On 28 October 2014, JEB issued these proceedings against Mr Binstock. The particulars of claim contained four claims, three concerning alleged breaches by Mr Binstock of an agreement with Mr Wilson, and the fourth concerning alleged breaches by Mr Binstock of an agreement with Mr Stannard.
15. On 11 November 2014, Mr Binstock filed an acknowledgment of service indicating that he intended to dispute the court's jurisdiction. On 24 November 2014, Mr Binstock made an application for an order declaring that the court had no jurisdiction to try the claim or, in the alternative, for an order striking it out on the ground that it was founded on a champertous assignment. That application was supported by a witness statement of Mr Binstock dated 25 November 2014.
16. The application to contest the jurisdiction came on for hearing before Judge Barker on 18 March 2015. Mr Hardy appeared on behalf of JEB and Mr Nicholas Vineall QC and Mr Caley Wright appeared on behalf of Mr Binstock. The judge heard full argument and at the end of the hearing gave an ex tempore judgment. He held, in summary, that Mr Binstock was not domiciled in this jurisdiction; that Mr Binstock was domiciled in another Member State, either Spain or France; and that the first, second and fourth claims concerned claims for breach of contract for the provision of services, but that there was no suggestion that those services were or should have been provided in this jurisdiction. He concluded that, in these circumstances, the court did not have jurisdiction to hear any of these three claims. There has been no appeal against this aspect of the judgment or his consequential order.
17. The third claim also concerned an allegation of breach of a contract for the provision of services but in this case, and for reasons to which I will come, Judge Barker held that there was a sufficient connection with this jurisdiction for the court to entertain the claim.
18. On 25 March 2015, Judge Barker again heard full argument from the parties, represented as before, in relation to the second limb of the application of 24 November 2014, namely whether the third claim, as the only surviving claim, should be struck out on the basis that it was founded upon a champertous assignment. The judge reserved judgment on this issue. On 21 April 2015, the judge handed down his judgment dismissing this limb of the application, save for a claim for aggravated damages which he decided was unsustainable.
19. On 6 May 2015, Mr Binstock issued an application for security for costs. Specifically Mr Binstock sought an order, pursuant to CPR rule 25.13, requiring JEB to give security for his costs of the proceedings and a further order, pursuant to CPR rule 25.14, joining Mr Wilson as a party to the proceedings and requiring him to give security for costs on the ground that he had assigned his claim to JEB with a view to avoiding the possibility of a costs order being made against him.
20. This application for security was supported by a witness statement of Mr Binstock's solicitor, Mr Damon Parker, dated 5 May 2015. In that statement Mr Parker summarised the history of the proceedings and then explained that he anticipated that the task of drafting a defence would be expensive for Mr Binstock and that, were he to begin it without security in place, it would expose him unnecessarily and unfairly to the risk that the costs of it would not be recovered. After summarising the nature of the surviving claim, Mr Parker estimated that, if the case were to proceed to trial, Mr Binstock would be likely to incur costs of between £550,000 and £660,000 and he proceeded to give an indication of the work that Mr Binstock and those acting for him would have to undertake. He explained that his estimate did not include the costs of an application for summary judgment or an appeal against the judge's finding in relation to champerty. However, no mention was made of an appeal against his finding that the court had jurisdiction to hear the third claim.
21. On 8 May 2015, a further hearing took place before Judge Barker at which he made the order the subject of this appeal. In summary, he declared that the court had no jurisdiction to hear the first, second and fourth claims but that it did have jurisdiction to hear the third claim; struck out the claim for aggravated damages in the third claim; dismissed the application for an order striking out the third claim on the basis it was champertous; gave Mr Binstock permission to appeal against the order so far as it concerned the jurisdiction to hear the third claim and its allegedly champertous nature; stayed the third claim pending the outcome of any such appeal; joined Mr Wilson to the proceedings for costs purposes and gave directions for the hearing of the application for security after the disposal of the appeal.
22. On 26 May 2015, Mr Binstock filed his notice of appeal against those parts of the order in relation to which he had permission to appeal.
23. On 15 July 2015, JEB filed a respondent's notice in which it made an application for permission to amend its particulars of claim and for permission to rely upon the matters set out in those amendments as further evidence in support of its opposition to the appeal. The application was stood over until the hearing of the appeal.

The appeal

Submission to the jurisdiction

24. It is convenient to deal with this issue first. The appeal came on for hearing on 22 June 2016. As I have mentioned, at the outset of the hearing Mr Hardy raised on behalf of JEB a new issue. He argued that, by making and pursuing his application for security for costs, Mr Binstock had submitted to the jurisdiction. Mr Caley Wright, who appeared on the appeal on behalf of Mr Binstock, responded in the course of his oral submissions at the hearing that this issue had been raised far too late and that we should not entertain argument upon it. Conscious as we were that Mr Wright had not had an opportunity to consider the issue or take instructions upon it, we gave the parties permission to file further submissions in writing after the oral hearing. Both parties took advantage of that permission; Mr Wright filed further submissions on behalf of Mr Binstock on 29 June 2016 and Mr Hardy filed further submissions on behalf of JEB on 4 July 2016.
25. It has now become clear from all of Mr Hardy's submissions that he seeks to contend that Mr Binstock has, by his conduct, submitted to the jurisdiction in two different but related ways. He points first, to Mr Binstock's conduct after the judge gave his ex tempore judgment on the issue of jurisdiction on 18 March 2015. As I have explained, the judge held that the court did have jurisdiction to hear the third claim. Mr Hardy contends that Mr Binstock did not, at the end of the hearing, apply for permission to appeal or for an extension of time to make such an application. Instead, one week later, Mr Binstock pressed on with his alternative application to have the claim struck out as being based upon a champertous assignment. In so doing, says Mr Hardy, Mr Binstock demonstrated that he accepted that the court had jurisdiction to try the claim.
26. Mr Hardy then focuses on the application made by Mr Binstock for security for costs on 6 May 2015, some two weeks after the judge had handed down his judgment on the champerty issue and two days before the date fixed for the third hearing to consider the form of order. Once again, says Mr Hardy, this application and the witness statement of Mr Parker filed in support of it demonstrated a recognition by Mr Binstock that the court does have jurisdiction to hear the claim.
27. In his further written submissions, Mr Wright has maintained his vigorous objection to this issue being raised. He argues that the question whether a party has, by his conduct, submitted to the jurisdiction is highly fact sensitive and here the issue has been raised so late and in such a way that Mr Binstock has still not had an opportunity properly to deal with it or to serve evidence in relation to it. He also submits that JEB's contentions are without merit because Mr Binstock made clear at the outset that he was challenging the jurisdiction and that nothing that he did subsequently constituted an unequivocal waiver of that challenge.
28. I have come to the conclusion that we should not give JEB permission to raise this issue on this appeal. We are concerned with an appeal by Mr Binstock against that part of the order of Judge Barker which contained a declaration that the court had jurisdiction to try the third claim. That declaration was made further to the ex tempore judgment given by the judge on 18 March 2015 in which he held that the subject matter of the third claim had a sufficient connection with this jurisdiction for the court to entertain it. However, all of the matters upon which JEB now seeks to rely as constituting a recognition by Mr Binstock that the court has jurisdiction are of a quite different nature and, importantly, occurred after he had given judgment. For these reasons they are, in my judgment, outwith the scope of this appeal and cannot properly be relied upon by way of respondent's notice as giving rise to a different or additional reason for upholding the judge's order.
29. Furthermore, I believe it would be manifestly unjust to allow JEB to rely in this appeal upon the arguments Mr Hardy has developed on its behalf. They were formulated in writing by Mr Hardy for the first time in his submissions filed on 4 July 2016 and it is clear that Mr Binstock has not had a full and fair opportunity to consider them with those advising him or to serve evidence in relation to them. Moreover, there are, as Mr Wright submits, aspects of the conduct of the parties and the way in which the applications were dealt with by the judge which would support the contention that it was at all times understood by the parties, and would have been perfectly clear to a disinterested bystander, that at no stage did Mr Binstock abandon his challenge to the jurisdiction.
30. Mr Wright points, by way of example, to the conduct of both parties after the judge had given his ex tempore judgment on 18 March 2015. He accepts that Mr Binstock did not, on that occasion, seek permission to appeal or ask in express terms for an extension of time in which to do so. However, he also draws attention to the fact that neither party invited the judge to make any order disposing of the application or giving directions, pursuant to CPR rule 11(7), for the filing by Mr Binstock of a further acknowledgment of service and, were he to do so, for the filing and service by JEB of a defence. In other words, says Mr Wright, it was clear to both parties that all of these matters had been adjourned to a later hearing.
31. The parties convened again on 25 March 2015 for the hearing of the second limb of Mr Binstock's application, that is to say that the claim was based upon a champertous assignment and should for that reason be struck out. A review of the transcript reveals that, at the end of the hearing, Judge Barker indicated to the parties that he would reserve judgment and would in due course and in the usual way hand it down in approved final form, having earlier provided it to the parties in draft for the purpose of identifying typographical and other obvious errors. He also indicated that neither party needed to attend the hand down and that directions would then be given for the disposal of "consequential matters, including applications for permission to appeal". In the event the judgment was handed down on 21 April 2015 and the further hearing fixed for the 8 May 2015.
32. In the meantime, on 6 May 2015, Mr Binstock made his application for security for costs. But, says Mr Wright, this must be seen in light of the fact that the parties understood that in just two days' time they would be attending a hearing to address the terms of the order to be made on both limbs of Mr Binstock's application, including his application for a declaration that the court had no jurisdiction to hear the claim. Indeed, Mr Wright continues, JEB was on the same day served with Mr Binstock's skeleton argument, which mentioned the issue of permission to appeal, and a supplementary bundle containing a transcript of the argument and judgment on the jurisdiction issue. Mr Wright submits that in all these circumstances it cannot be said that Mr Binstock's conduct amounts to an unequivocal waiver of his challenge.
33. These are some of the matters upon which Mr Binstock wishes to rely. There may be others. In the result, the question whether Mr Binstock has, by his conduct, submitted to the jurisdiction has been raised by Mr Hardy in such a way that it cannot properly be explored before or fairly adjudicated upon by this court. If JEB wishes to pursue this issue then, in my judgment, it must do so before a judge of the High Court. I would, however, make it clear that, in so saying, I am expressing no view as to the merits of such a course.

Further evidence

34. I turn now to the application by JEB for permission to amend its particulars of claim and for permission to rely upon those amended particulars of claim as fresh evidence on this appeal.
35. The relevant chronology may be summarised as follows. On or about 28 October 2014, the original particulars of claim were served. They were verified by a statement of truth signed by Mr Hardy. On 24 November 2014, Mr Binstock made his application for an order declaring that the court had no jurisdiction to try the claim and he supported that application with his witness statement dated 25 November 2014. JEB responded to the application with a witness statement of Mr Hardy dated 4 March 2015. Finally, Mr Edward Parkes, Mr Binstock's solicitor, made a witness statement in reply dated 13 March 2015. The hearing of the jurisdiction challenge took place 18 March 2015 and Judge Barker gave an ex tempore judgment. On 8 May 2015, Judge Barker made his order upon the application. On 26 May 2015, Mr Binstock filed his appellant's notice and skeleton argument in support of the appeal. On 22 June 2015, JEB filed its respondent's notice in which it sought permission to amend its particulars of claim in the form of the draft amended particulars appended to the notice and sought permission to rely upon the matters set out in those draft amended particulars as further evidence in support of the judge's finding that the court does have jurisdiction to entertain the third claim. This application was supported by a witness statement of Mr Wilson dated 22 June 2015 in which he confirms that the contents of the draft amended particulars are true.
36. The draft amended particulars contain further and more detailed allegations concerning the place of performance of Mr Wilson's obligations under the alleged agreement between Mr Wilson and Mr Binstock that forms the basis of the third claim. Importantly for present purposes, they contain further and more detailed allegations concerning the extent to which Mr Wilson agreed that he would perform and did in fact perform his obligations under the alleged agreement in England.
37. The principles to be applied in considering an application for permission to rely upon further evidence on appeal are not in dispute. In summary, the court must seek to give effect to the overriding objective, but pre-CPR cases, including Ladd v Marshall [1954] 1 WLR 1489, remain of relevance, indeed of powerful persuasive authority. In Ladd v Marshall the Court of Appeal explained that an applicant for permission to rely upon further evidence on appeal must show that: (i) the evidence could not have been obtained with reasonable diligence for use at the trial; (ii) the evidence is such that, if given, it would probably have an important influence on the result of the case, though it need not be decisive; and (iii) the evidence is such as is presumably to be believed; it must be apparently credible, though it need not be incontrovertible.
38. Mr Hardy submits we should give JEB permission to rely upon the fresh evidence for three reasons. First, he accepts that JEB could have given the fresh evidence at the hearing before Judge Barker but says it did not do so because, as a litigant in person, it did not appreciate what he describes as the "the twin attacks on jurisdiction" and the importance of explaining the place of performance of Mr Wilson's obligations under the agreement. Secondly, JEB did not deliberately hold the fresh evidence back in an attempt to obtain some kind of tactical advantage. Thirdly and in light of the nature of the hearing before Judge Barker, Mr Binstock would not suffer any real prejudice were we to give JEB the permission it seeks.
39. I have found Mr Hardy's submissions wholly unpersuasive. It was or ought to have been clear to him and to JEB that the primary rule of jurisdiction in the Regulation is that a defendant domiciled in a Member State is to be sued in the courts of that Member State. If JEB wished to rely upon one of the jurisdictional 'gateways' provided by Article 5 of the Regulation then it was incumbent upon it properly to develop its case accordingly and to adduce such evidence in support of that case as it considered appropriate. Moreover, Mr Binstock's position in relation to the third claim was in any event made perfectly clear in paragraphs [64] to [73] of his witness statement dated 25 November 2014. There he said that Mr Wilson's obligations under the alleged agreement the subject of this claim were to be performed in France and the Netherlands, and not the United Kingdom. JEB had ample time in which to consider the implications of this evidence and respond to it if it wished to do so.
40. Furthermore, I cannot accept the submission that JEB should be treated differently from any other litigant because it has been represented by Mr Hardy rather than solicitors and counsel. JEB was formed by its three members for the purpose of pursuing these claims against Mr Binstock. Whatever may be the financial status of JEB, there is no evidence before the court to the effect that these members are so impecunious that, between them, they could not afford legal representation. Indeed, Mr Hardy told us that in relation to at least one aspect of these proceedings JEB has been advised by Queen's Counsel acting on a direct access basis.
41. Turning now to Mr Hardy's other submissions, the fact that JEB did not deliberately hold the fresh evidence back in an attempt to obtain some kind of tactical advantage is no reason to allow it to be admitted on appeal. Parties must understand that a hearing at first instance is not a trial run and that it is their duty diligently to gather and adduce all of the evidence upon which they wish to rely and which is relevant to the issues before the court. I also reject the submission that Mr Binstock would not suffer prejudice were we to accede to the application. The fresh evidence is contentious, Mr Binstock has had no opportunity to answer it and, were it to be admitted, it would require us to conduct a new and different hearing from that which occurred before Judge Barker.
42. In my judgment, this application by JEB for permission to rely upon fresh evidence on this appeal has fallen at the first hurdle. The evidence could have been obtained with reasonable diligence for use at the hearing before Judge Barker and it would be contrary to the interests of justice and the overriding objective for this court to give the permission sought. For all of these reasons, I was and remain of the view that this application must be refused.
43. That leaves the application by JEB for permission to amend its particulars of claim. This application was not the subject of separate submissions at the appeal hearing and we expressed no view as to its merits. It seems to me that JEB may therefore pursue this application before a judge of the High Court if it succeeds in establishing that Mr Binstock has, by his conduct, submitted to the jurisdiction.

Jurisdiction

44. I must begin by saying a little more about the way JEB has developed its case. Its contentions, as set out in the particulars of claim, are rather diffuse and in many important respects lack clarity but, for present purposes, may be summarised as follows. JEB claims damages in respect of the breach by Mr Binstock of an agreement which he made with Mr Wilson. In February 2010, Mr Binstock invited Mr Wilson to assist him to identify and acquire a company listed on an authorised stock exchange. It was Mr Binstock's intention that this company would then acquire his business assets. Mr Binstock said that he wished to put his business affairs in order and that this arrangement would make his business assets more readily realisable. He also offered to pay to Mr Wilson a monthly retainer of €10,000 and to reimburse all of Mr Wilson's expenses, and he promised that the consideration would also reflect the monies which Mr Wilson claimed Mr Binstock owed him arising from their prior business dealings.
45. Mr Wilson and his wife had strong reservations about Mr Wilson accepting Mr Binstock's offer given Mr Binstock's failure to pay to Mr Wilson the money, amounting to in excess of £10 million, which they believed Mr Binstock owed him. Nevertheless, on 1 March 2010, Mr Wilson and his wife met Mr Binstock at a hotel in London. At this meeting Mr Binstock told Mr Wilson and his wife that he wished to appoint Mr Wilson as the chief executive officer of the company to be acquired and that Mr Wilson would have a substantial shareholding in it. He continued that he was concerned to set his affairs in order and that Mr Wilson was one of the few people he could trust to assist him. He also acknowledged his indebtedness to Mr Wilson. Mr Wilson's wife indicated to Mr Binstock that she was reassured by his candour and asked him where the company would be based. Mr Binstock explained that his initial thought was to acquire a company incorporated in the Netherlands but that it should have its main place of business in Paris. It appears to be JEB's case that, at this meeting, Mr Binstock and Mr Wilson reached an agreement. In any event, Mr Binstock asked Mr Wilson to meet him in Amsterdam in a few days' time to begin work on the project and he agreed to do so.
46. On or about 7 March 2010, Mr Wilson duly met Mr Binstock in Amsterdam. They had further discussions and Mr Binstock agreed that Mr Wilson would indeed be chief executive officer of the new company and that he would own shares in it with a value of €31.5 million. A statement to this effect was then sent to possible advisers, including a KPMG entity in Amsterdam and BDO LLP in London. Mr Binstock also invited Mr Wilson to live in his apartment in Paris and it appears that Mr Wilson accepted that invitation.
47. Mr Wilson worked on the project over the months that followed. In that connection he was engaged in, among other matters, the reorganisation of Mr Binstock's business interests in Spain and elsewhere and work with BDO in London to try to identify a suitable company to implement Mr Binstock's strategy.
48. From the outset, Mr Wilson prepared and submitted invoices to Mr Binstock for the work he had carried out. These invoices were printed out in Mr Binstock's apartment in Paris and agreed by Mr Binstock, but they were never paid. From time to time Mr Binstock offered to pay Mr Wilson in cash, but Mr Wilson refused. In due course and at the suggestion of one of Mr Binstock's advisers, Mr Wilson met BDO in London and set up a limited liability partnership and a sister company in the Isle of Man, each of which was owned by a Bermudan company owned and controlled by Mr Wilson and his wife. It was Mr Wilson's intention that he would provide his services through these entities, but only once the reorganisation of Mr Binstock's business interests had been completed.
49. In September 2010, and after what are said to have been several months of talks, BDO and Mr Wilson identified what they thought would be a suitable company. However, at about the same time, Mr Wilson, who was also deeply involved with the reorganisation of Mr Binstock's businesses in Spain, became aware of what he believed to be serious irregularities in the accounts of Gran Casino Aljarafe SA ("GCA"), the company responsible for the operation of Mr Binstock's Spanish casino interests. He drew these to the attention of Mr Binstock and explained that they would have to be regularised if Mr Binstock wished to implement his plans. This triggered a souring of the relations between Mr Wilson and Mr Binstock, and, not long afterwards, Mr Binstock told Mr Wilson that he was abandoning the reorganisation project altogether. Mr Wilson thereupon demanded payment of all sums owing to him which, save for some €57,000, remain outstanding.
50. Judge Barker found that Mr Binstock was not domiciled in this jurisdiction and, as I have said, there has been no appeal against this finding. In order to found jurisdiction, JEB therefore turned to Article 5 of the Regulation which, as we have seen, provides that a person domiciled in one Member State may be sued, in matters relating to a contract, in the courts of another Member State if that is the place of performance of the obligation in question. Further, under Article 5(1)(b), the place of performance of an obligation is, in the case of the provision of services, the place in a Member State where, under the contract, the services were provided or should have been provided.
51. In Case C-19/09 Wood Floor Solutions Andreas Domberger GmbH v Silva Trade SA [2010] 1 WLR 1900 the Court of Justice considered how Article 5(1)(b) of the Regulation should be understood and applied where, under an agency contract, services are to be provided in several Member States. The Court explained the approach to be adopted in these terms:

"33. Accordingly, for the purposes of applying the rule of special jurisdiction in matters relating to a contract, laid down in the second indent of article 5(1)(b) of the Regulation, concerning the provision of services, when there are several places of delivery of the goods the "place of performance" must be understood as the place with the closest linking factor, which, as a general rule, will be at the place of the main provision of services.

….

38 . Having regard to the objective of predictability laid down by the legislature in recital 11 in the Preamble to the Regulation, and taking account of the wording of the second indent of article 5(1)(b) , according to which it is the place in a member state where, under the contract, the services were provided or should have been provided which is decisive, the place of the main provision of services must be deduced, in so far as possible, from the provisions of the contract itself. Thus, in the context of a commercial agency contract, the place where the agent was to carry out his work on behalf of the principal, consisting in particular in preparing, negotiating and, where appropriate, concluding the transactions for which he has authority has to be identified, on the basis of that contract.

39 . The determination of the place of the main provision of services according to the contractual choice of the parties meets the objective of proximity, since that place has, by its very nature, a link with the substance of the dispute.

40 . If the provisions of a contract do not enable the place of the main provision of services to be determined, either because they provide for several places where services are provided, or because they do not expressly provide for any specific place where services are to be provided, but the agent has already provided such services, it is appropriate, in the alternative, to take account of the place where he has in fact for the most part carried out his activities in the performance of the contract, provided that the provision of services in that place is not contrary to the parties' intentions as it appears from the provisions of the contract. For that purpose, the factual aspects of the case may be taken into consideration, in particular, the time spent in those places and the importance of the activities carried out there. It is for the national court seised to determine whether it has jurisdiction in the light of the evidence submitted to it: Case C-386/05 Color Drack GmbH v Lexx International Vertriebs GmbH [2010] 1 WLR 1909 , para 41.

41. Fourth, if the place of the main provision of services cannot be determined on the basis of the provisions of the contract itself or its actual performance, the place must be identified by another means which respects the objectives of predictability and proximity pursued by the legislature.

42. For that purpose, it will be necessary for the purposes of the application of the second indent of article 5(1)(b) to consider, as the place of the main provision of the services provided by a commercial agent, the place where that agent is domiciled. That place can always be identified with certainty and is therefore predictable. Moreover, it has a link of proximity with the dispute since the agent will in all likelihood provide a substantial part of his services there.

43. Having regard to all the above considerations, the answer to the question 1(b) is that the second indent of article 5(1)(b) of the Regulation must be interpreted as meaning that where services are provided in several member states, the court having jurisdiction to hear and determine all the claims based on the contract is the court within whose jurisdiction the place of the main provision of services is situated. For a commercial agency contract, that place is the place of the main provision of services by the agent, as it appears from the provisions of the contract or, in the absence of such provisions, the actual performance of that contract or, where it cannot be determined on that basis, the place where the agent is domiciled."

52. In my judgment these principles are also applicable in a case of the kind with which we are concerned, and may be summarised as follows. First, the place of performance must be understood as the place with the closest linking factor between the contract and the court having jurisdiction and, as a general rule, this will be at the place of the main provision of the services.
53. Secondly, the place of the main provision of the services must be deduced, so far as possible, from the provisions of the contract itself.
54. Thirdly, if the provisions of the contract do not enable the place of the main provision of the services to be determined, either because they provide for several places where services are to be provided or because they do not expressly provide for any specific place where services are to be provided, but services have already been provided, it is appropriate, in the alternative, to take account of the place where activities in performance of the contract have for the most part been carried out, provided that the provision of services in that place is not contrary to the parties' intentions as appears from the contract.
55. Fourthly, if the place of the main provision of the services cannot be determined on the basis of the terms of the contract or its performance, then it must be identified by another means which respects the objectives of predictability and proximity, and this will be the place where the party providing the services is domiciled.
56. There is one other matter to which I should refer and which I understand to be common ground, namely that JEB has to show that it has a good arguable case that the conditions for the establishment of jurisdiction are satisfied.
57. Judge Barker dealt with the issue of jurisdiction in relation to this third claim in very concise terms. His reasoning is encompassed in just three paragraphs of his judgment:

"15. … The position is different though in connection with the third claim, which is for the provision of services by Mr Wilson for the attainment of a reverse takeover by which Mr Binstock's business interests would be reversed into a company not active but having cash which had to be located. For this purpose, Mr Wilson located himself largely in the Paris flat of Mr Binstock, but it is alleged at paragraph 41 of the particulars of claim that Mr Wilson worked with BDO, a well-known firm of accountants, in London to source a clean company with cash and no trading history and that talks went on for several months in or around 2010. What the paragraph in the particulars of claim leaves at least as a matter of ambiguity is whether the work on the part of Mr Wilson with BDO actually took place in London or whether the reference to London was to the particular office of BDO with which Mr Wilson dealt.

16. That is clarified, to an extent, at paragraph 51 where the allegation is that Mr Wilson met with BDO in London and arranged to set up a new English limited liability partnership in offices at their London address, but ultimately aimed and controlled through a company to be registered or already registered in Bermuda. That certainly points to the performance of services within this jurisdiction and the procurement of an English corporate vehicle for the reverse takeover seems to have been the intention of Mr Binstock. True it is that that could have been undertaken remotely from and without coming within this jurisdiction, but it is not surprising that there was some activity within the jurisdiction. Whether that is sufficient or not, and Mr Vineall submits that it is not sufficient, is another matter. It is not possible, on the allegations as they stand before me, to discern the importance or otherwise of the work undertaken leading up to and at the meeting in London.

17. Nevertheless, it seems to me that there is, on this aspect of the claim alone, a sufficient connection with this jurisdiction for the court, at this stage and in principle, to entertain that claim which is the third claim in this action."

58. I believe that Judge Barker fell into error in these paragraphs in a number of important respects. First, he lost sight of the fact that the burden lies upon JEB to satisfy the court that it has a good arguable case that the claim falls within one or more classes of case in which permission to serve out may be given. In this context "good arguable case" connotes that one side has a much better argument than the other. There is no indication in the judge's reasoning that he properly directed himself in this regard. To the contrary, he explained in paragraph [16] of his judgment that it was not possible, on the allegations as they stood before him, to discern "the importance of otherwise" of the work carried out in London. Nevertheless, he thought there was "a sufficient connection" with this jurisdiction for the court "at this stage and in principle" to entertain the claim.
59. Secondly, I cannot detect in Judge Barker's analysis any attempt to identify the place of the main provision of the services, whether from the terms of the alleged agreement or from a consideration of where Mr Wilson's activities in performance of the alleged agreement were for the most part carried out. The pleading is so vague as to the terms of the alleged agreement that in my judgment it is not possible to discern the place of the main provision of the services with any degree of confidence, but such details as are provided suggest that it was agreed that the services to be provided by Mr Wilson would include assisting Mr Binstock to identify and acquire a publicly quoted company and then arranging for this company to acquire Mr Binstock's business assets. It also appears to have been agreed that, following the acquisition, this company would have its main place of business in Paris and that Mr Wilson would in due course become its chief executive officer. In my judgment there is no proper basis here for a conclusion that, based upon the provisions of the alleged agreement, JEB has a good arguable case that England was to be the place of the main provision of Mr Wilson's services.
60. Turning to the place where Mr Wilson in fact for the most part carried out his activities in performance of the alleged agreement, the position is again very unclear. Nevertheless, it is alleged by JEB that Mr Wilson did indeed base himself in Paris and that he lived there in Mr Binstock's apartment. This was the place from which he issued his invoices. It is also said that, over the course of the ensuing months, Mr Wilson worked with BDO in London to identify a suitable company, and that, in September 2010, they found an English company which appeared to meet Mr Binstock's requirements. However, Mr Wilson was also looking into and starting to reorganise Mr Binstock's business interests in Spain and elsewhere. In the course of this work, Mr Wilson recommended the appointment of BDO as auditors to GCA and, in due course, Mr Wilson was appointed as one of its directors.
61. Once again, I do not believe it is possible, on the materials before the court, to say that, based upon the place where the services have for the most part been carried out, JEB has a good arguable case that the place of the main provision of Mr Wilson's services was England. True it is that Mr Wilson is said to have worked with BDO in London to identify a suitable publicly quoted company, but no detail is given as to the extent of that work or how often Mr Wilson travelled to London to carry it out. Nor is any detail provided as to the extent or duration of the work Mr Wilson carried out in Spain.
62. In this connection, I should also mention one other matter. Judge Barker attached some importance to the allegation that Mr Wilson met BDO in London and arranged to set up a new English liability partnership which was (or would be) controlled through a Bermudan company. This, the judge thought, pointed to the performance of services in this jurisdiction. I disagree. As I have explained, this limited liability partnership was established not for the purpose of implementing Mr Binstock's aims but as a vehicle through which Mr Wilson would provide his services and be paid. This was not an aspect of the services which Mr Wilson had agreed to carry out under the terms of the alleged agreement. But even if the judge was entitled to take it into account, I am satisfied it is still quite impossible to say that JEB has a good arguable case that England was the place of the main provision of Mr Wilson's services.
63. It follows from the foregoing that JEB has not established that it has a good arguable case that England was the place of the main provision of the services on the basis of the terms of the alleged agreement or its performance. As for the final stage of the Wood Floor analysis, it has not been suggested that Mr Wilson was at any material time domiciled in England. Accordingly, I would allow the appeal on the jurisdiction issue.

Champerty

64. In these circumstance it is not necessary to consider whether Judge Barker was right to find that the claim was not founded upon a champertous assignment and I prefer not to do so.

Conclusion

65. For the reasons I have given, I would allow the appeal. In my judgment the English courts cannot assume jurisdiction in relation to the third claim on the basis of special rules of jurisdiction contained in Article 5 of the Regulation. If JEB wishes to pursue the contention that Mr Binstock has, by his actions since 18 March 2015, submitted to the jurisdiction then it must do so before a judge of the High Court, and I would invite the parties to agree and lodge for our consideration the terms of a draft order which would give effect to the terms of this judgment but nevertheless allow JEB a short but reasonable opportunity to take that course, if so advised.

Lord Justice Tomlinson:

66. I agree

Lord Justice Moore-Bick

67. I also agree.