Jurisdictional challenge brought where fraud alleged originated abroad


Re: Eurasia Sports Ltd v Tsai (k/a Martin Tsai) & Ors [2016] EWHC 2207 (QB)

The claimant operated a betting agency, and agreed to open betting accounts in Peru for the defendants. Considerable credit was advanced, but the accounts rapidly fell into debt and security that was promised failed to materialise. The claimant wished to make various claims against the defendants for debt dues on betting accounts, fraudulent misrepresentation and/or conspiracy to injure, conspiracy to defraud and other contractual breaches, and was given permission to serve out of jurisdiction. Three of the defendants responded by making an application challenging the jurisdiction of the court to hear proceedings.

The court found that there was a serious issue to be tried in relation to all the claims raised by the claimant. It then turned to consider whether the claimant had a good arguable case that the claims fell within the jurisdictional gateways set out in para 3.1 of the CPR 6 B PD on service out of the jurisdiction where permission is required.

It held that the tort claims qualified through the para 3.1(9)(a) gateway, concluding that the damage to the claimant occurred within this jurisdiction, as it was in London that the claimant made the decision to permit bets to be placed, based on the fraudulent security offers.  However, it did not accept that breaches of contract were committed within the jurisdiction, meaning that the contract claims could not rely on the para 3.1(7) gateway. Contract claims regarding some of the defendants’ personal better accounts did qualify under para 3.1(6)(a), where the defendants’ acceptance of terms was received by the claimant in London, via Whatsapp and email.

It found that other contractual claims against the three defendants could succeed through the para 3.1(3)(a) gateway, concluding that they were proper parties to the extant action, allowing the court to consider the other claims which it would otherwise have had no jurisdiction to hear. Emphasis was placed on the fact that only one investigation would be involved, given how closely related the claims were.

The court also considered the new gateway introduced by para 3.1(4A), which allows permission for service out of the jurisdiction to be granted where a further claim is made against the same defendant arising out of the same or closely connected facts which have allowed a claim to succeed under paras (2), (6) to (16), (19) or (21). As claims had been made out under para 3.1(9) and the other claims could be said to arise out of “the same of closely connected facts”, the court found that this test was also met. It made obiter comments that the phrase had a similar meaning to the ‘proper party’ test, suggesting that where one test was met, it was likely that the other would also be fulfilled.

The court thus concluded that the claimant had much the better of the argument in establishing that all claims fell within at least one of the gateways.

In deciding whether England was clearly the most appropriate forum for the trial of action, the court placed emphasis on the existence of related proceedings in the jurisdiction already, and the argument that proceedings in Peru could be corrupted, given the influence that the defendants may have in that jurisdiction.

Antony White QC was involved in this case.