Judgments - Schalk Willem Burger Lubbe (Suing as Administrator of the Estate of Rachel Jacoba Lubbe) and 4 Others and Cape Plc. and Related Appeals

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    The material placed before the House (and the lower courts) relevant to these issues is very extensive and cannot conveniently be summarised. The following conclusions are in my opinion to be drawn from it:

1) The proceedings as now constituted can only be handled efficiently, cost-effectively and expeditiously on a group basis. It is impossible at this stage to predict with accuracy what procedural directions might on that basis be given in future (although the directions could only relate to the conduct of proceedings in England). Obvious possibilities include the trial of a preliminary issue on the parent company responsibility question and the trial of selected lead cases to test the outcome in different factual situations. It would be very highly desirable, if possible, to avoid determination of these claims on a plaintiff by plaintiff basis.

2) The plaintiffs' claims raise a serious legal issue concerning the duty of the defendant as a parent company, and it would be necessary to decide whether that duty was governed by English or South African law. If a duty were held to exist, there would be a serious factual issue whether the defendant was in breach of it. If the plaintiffs were successful on these questions, the personal injury issues would have, even in the context of a group action, to be investigated, prepared and quantified. This would be a heavy and difficult task. It could only be done by, or under the supervision of, professional lawyers. It would call for high quality expert advice and evidence, certainly on medical and industrial issues, very possibly on other issues also. I see no reason to question the judgment of a South African attorney instructed by the defendant who swore:

    "The magnitude and complexity of both the factual and legal issues will require the application in South Africa of considerable financial resources and manpower, if there is to be any reasonable prospect of addressing the plaintiffs' allegations meaningfully."

It is significant that Professor Unterhalter, an independent expert approached by the defendant, observed:

    "Detailed expert evidence would be required on a number of aspects of the matter. Without agreement between the parties as to how the issues might be limited, I would venture no opinion as to the length and magnitude of this litigation, save to say that it is likely to be drawn out and complex, and would almost certainly come before the Supreme Court of Appeal in due course."

3) A possibility must exist that the proceedings may culminate in settlement. The plaintiffs confidently predict such an outcome if they succeed on the parent company responsibility issue. But the defendant has given no indication that the claims will not be fully contested. In the Spiliada case Staughton J. thought it right to decide the stay application on the assumption that there would be a trial, and it would seem to me wrong in principle to reject a submission that justice will not be done in a foreign forum on the basis of a speculative assumption that, if a stay is granted, proceedings in the foreign forum will culminate in a just settlement without the need for a trial.

4) In a letter dated 20 September 1999 to Leigh, Day and Company representing some of the plaintiffs, the Legal Aid Board of South Africa wrote:

    "It will however be of interest to you to note that on 13 September 1999 the Legal Aid Board resolved, because of the financial crisis faced by it, as per the attached letter to the Minister of Justice, to exclude from the operation of the legal aid scheme operated by the South African Legal Aid Board with effect from 1 November 1999 funding in respect of personal injury claims and all other claims sounding in the money."

    Other material before the House makes plain that before this decision the Legal Aid Board had experienced a period of extreme financial stringency. Despite suggestions to the contrary there is no convincing evidence to suggest that legal aid might be made available in South Africa to fund this potentially protracted and expensive litigation. Written submissions on behalf of the Republic of South Africa contain no hint that public funds might, exceptionally, be made available to fund it.

    5) The South African Contingency Fees Act (No. 66 of 1997) sanctioned a new regime similar (although not identical) to that governing conditional fees in this country. It enables counsel and attorneys to undertake work for plaintiffs on the basis that if the claim is successful they will receive a fee in excess of that ordinarily chargeable, and that they receive nothing if the claim fails. This regime does not apply to the fees of expert witnesses, who may not be engaged on the basis that they are paid only if the plaintiff by whom they are called is successful. The defendant referred to an affidavit sworn by very experienced South African counsel who deposed:

    "In my view, if a firm of attorneys with a reasonable infra-structure is of the view that the claims of the present Plaintiffs are good, this would mean that the firm would be able to earn very substantial sums of money by way of fees. At the same time, one should not lose sight of the fact that this case is likely to have a very high profile and that the Plaintiffs' attorney/s would be accorded a great deal of positive publicity in the media. This would be a further inducement to take on a case of this nature. There is every reason to believe that there would be no shortage of firms of attorneys who would be desirous of taking on such a case if they believed that it had good prospects of success.

    "Accordingly, if there are attorneys in South Africa who are as positive about the prospects of success as [the plaintiffs' solicitor] is (as conveyed in his affidavit), I feel sure that there will be no lack of attorneys in South Africa prepared to represent these plaintiffs under Contingency Fee arrangements."

    This very general assertion of belief by a member of the Bar was flatly contradicted by a number of other equally distinguished counsel who provided sworn statements to the plaintiffs, and counsel for the defendant indicated that he placed no reliance on it. More significantly, it received no support from any practising attorney, and it would be attorneys who would be required, if these proceedings were undertaken for the plaintiffs on a contingency fee basis, to finance the investigation of the claims, the obtaining and calling of evidence and the conduct of the trial during a period which would inevitably last for months and, very much more probably, years. The clear, strong and unchallenged view of the attorneys who provided statements to the plaintiffs was that no firm of South African attorneys with expertise in this field had the means or would undertake the risk of conducting these proceedings on a contingency fee basis. The defendant suggested that financial support and professional assistance might be given to the plaintiffs by the Legal Resources Centre, but this suggestion was authoritatively contradicted. In a recent affidavit the possibility was raised that assistance might be forthcoming from the European Union Foundation for Human Rights in South Africa, but the evidence did not support the possibility of assistance on the scale necessary to fund this litigation.

    6) If these proceedings were stayed in favour of the more appropriate forum in South Africa the probability is that the plaintiffs would have no means of obtaining the professional representation and the expert evidence which would be essential if these claims were to be justly decided. This would amount to a denial of justice. In the special and unusual circumstances of these proceedings, lack of the means, in South Africa, to prosecute these claims to a conclusion provides a compelling ground, at the second stage of the Spiliada test, for refusing to stay the proceedings here.

    7) The conclusions on the funding issue reached by the second Court of Appeal did not in my opinion take account of the evidence, which did not permit the finding which the court made.

    The plaintiffs, as a ground for challenging the appropriateness of the South African forum, relied on the absence of established procedures in South Africa for handling group actions such as the present. They compared that situation with the procedural situation here, where the conduct of group actions is governed by a recently-developed but now tried and established framework of rules, practice directions and subordinate legislation. I do not regard this objection, standing alone, as compelling. It involves the kind of procedural comparison which the English court should be careful to eschew (Spiliada, page 482: Connelly, page 872), and the evidence is clear that South African courts have inherent jurisdiction to adopt procedures appropriate to the cases they are called upon to handle. There is force in the observations of Pill L.J. ([2000] 1 Lloyd's Rep. 139 at 162):

    "I am entirely unpersuaded by arguments that the South African High Court would be unable to handle these actions efficiently either on the ground that there are territorial divisions within South Africa or because there is at present no procedure expressly providing for group actions. It is common ground that the law potentially to be applied is the same throughout South Africa.

    "In England, there has been a vast amount of litigation by victims of asbestos dust without resort to group actions. Whether by a form of group action or otherwise, I have no doubt that the High Court of South Africa will be able to devise and adopt suitable procedures for the efficient despatch of business such as this. None of the evidence or submissions on behalf of the plaintiffs suggests any significant obstacle to that efficient despatch by the Court of cases before it."

    I do, however, think that the absence, as yet, of developed procedures for handling group actions in South Africa reinforces the submissions made by the plaintiffs on the funding issue. It is one thing to embark on and fund a heavy group action where the procedures governing the conduct of the proceedings are known to and understood by experienced judges and practitioners. It may be quite another where the exercise is novel and untried. There must then be an increased likelihood of interlocutory decisions which are contentious, with the likelihood of appeals and delay. It cannot be assumed that all judges will respond to this new procedural challenge in the same innovative spirit. The exercise of jurisdiction by the South African High Court through separate territorial divisions, while not a potent obstacle in itself, could contribute to delay, uncertainty and cost. The procedural novelty of these proceedings, if pursued in South Africa, must in my view act as a further disincentive to any person or body considering whether or not to finance the proceedings.

Third Parties

    Both before Buckley J. and the second Court of Appeal it was contended by the defendant and accepted as a factor pointing towards the appropriateness of the South African forum that the defendant, if sued there, could make and enforce claims against third parties who could be shown to have contributed to the plaintiffs' condition, whereas it might be difficult to join such parties and enforce judgments if the actions were pursued here. The plaintiffs have sought to meet this point by questioning whether, in truth, the defendant has disclosed any potential claim against an identified third party with assets or insurance sufficient to meet any significant claim; by relying on Court of Appeal authority (Holtby v. Brigham & Cowan (Hull) Ltd., unreported, 6 April 2000) for the proposition that a defendant is only liable for such proportion of a plaintiff's damage as he is shown to have caused; and by formally undertaking, in asbestos (but not mesothelioma) cases, to limit their claim to compensation for loss and damage for asbestos-related disease to such sum as would reflect the proportion of a plaintiff's total asbestos exposure as was shown to be the defendant's responsibility. The courts below were in my judgment right to treat the third party consideration as one strengthening the appropriateness of the South African forum, but I am persuaded by the plaintiffs' response that the refusal of a stay will not expose the defendant to a significant risk of prejudice so long as any new claimants are admitted to the group only upon their binding themselves by the undertaking of the present plaintiffs.

Article 6 of the European Convention on Human Rights

    The plaintiffs submitted that to stay these proceedings in favour of the South African forum would violate the plaintiffs' rights guaranteed by Article 6 of the European Convention since it would, because of the lack of funding and legal representation in South Africa, deny them a fair trial on terms of litigious equality with the defendant. For reasons already given, I have concluded that a stay would lead to a denial of justice to the plaintiffs. Since, as Spiliada makes clear, a stay will not be granted where it is established by cogent evidence that the plaintiff will not obtain justice in the foreign forum, I cannot conceive that the court would grant a stay in any case where adequate funding and legal representation of the plaintiff were judged to be necessary to the doing of justice and these were clearly shown to be unavailable in the foreign forum although available here. I do not think Article 6 supports any conclusion which is not already reached on application of Spiliada principles. I cannot, however, accept the view of the second Court of Appeal that it would be right to decline jurisdiction in favour of South Africa even if legal representation were not available there.

Public Interest

    Both the plaintiffs and the defendant placed reliance on public interest considerations as strengthening their contentions that these proceedings should be tried in the forum for which they respectively contended. I agree with my noble and learned friend Lord Hope of Craighead, for the reasons which he gives, that public interest considerations not related to the private interests of the parties and the ends of justice have no bearing on the decision which the court has to make. Where a catastrophe has occurred in a particular place, the facts that numerous victims live in that place, that the relevant evidence is to be found there and that site inspections are most conveniently and inexpensively carried out there will provide factors connecting any ensuing litigation with the court exercising jurisdiction in that place. These are matters of which the Spiliada test takes full account. It is important that the focus should remain on the principle so clearly stated by Lord Kinnear: in applying this principle questions of judicial amour propre and political interest or responsibility have no part to play.

Article 2 of the Brussels Convention

    The House received and heard erudite argument on the applicability of Article 2 of the Brussels Convention to a case such as the present. The plaintiffs submitted that the court was precluded by Article 2 from granting a stay. The defendant argued that the jurisdiction of the court to grant a stay in favour of a forum in a non-contracting state was unaffected by Article 2. The correctness of the Court of Appeal decision in In re Harrods (Buenos Aires) Ltd. [1992] Ch. 72 was in issue. Both parties argued that the answer for which they respectively contended was clearly correct. If it was not, the plaintiffs invited the House to seek a ruling from the European Court of Justice, a course which the defendant resisted.

    For reasons already given, I am unwilling to stay the plaintiffs' proceedings in this country. It is accordingly unnecessary to decide whether the effect of Article 2 is to deprive the English court of jurisdiction to grant a stay in a case such as this. Had it been necessary to resolve that question, I would have thought it necessary to seek a ruling on the applicability on Article 2 from the European Court of Justice, since I do not consider the answer to that question to be clear.


    I would dismiss the defendant's appeal against the decision of the first Court of Appeal. I would allow the plaintiffs' appeal against the decision of the second Court of Appeal and remove the stay which that court upheld. The defendant must bear the costs of both appeals, and also the costs of the proceedings before Buckley J. and the second Court of Appeal.


My Lords,

    I have had the advantage of reading in draft the speeches of my noble and learned friends Lord Bingham of Cornhill and Lord Hope of Craighead. For the reasons they give I would also make the order which Lord Bingham of Cornhill proposes.


My Lords,

    I have had the advantage of reading in draft the speeches of my noble and learned friends Lord Bingham of Cornhill and Lord Hope of Craighead. For the reasons they give, I would also make the order which Lord Bingham of Cornhill proposes.


My Lords,

    I have had the advantage of reading in draft the speech of my noble and learned friend Lord Bingham of Cornhill. I agree with it, and for the reasons which he has given I too would allow the claimants' appeals and dismiss the appeal by the defendant. I should however like to add some observations on two matters that were raised in the course of the argument about the doctrine of forum non conveniens.

Available forum

    It is clear that the decision of the first Court of Appeal [1998] C.L.C. 1559 to refuse a stay was much influenced by the view which they formed about the defendant's submission that the South African courts were available to the plaintiffs because it had offered during the hearing before the judge to submit to the jurisdiction of those courts.

    It was not suggested to the judge that there were any reasons for doubting that this offer had removed the difficulty that the defendant was not otherwise subject to the jurisdiction of the South African courts as it was neither present nor had any assets in South Africa. But in the Court of Appeal it was contended that the offer was objectionable, for two reasons. The first was that the courts in South Africa were not available at the time when the plaintiffs brought their proceedings in England, as the defendant did not indicate its willingness to be sued in South Africa until after the proceedings had been brought. The second was that the effect of treating the South African courts as available in these circumstances was to give the defendant a choice of jurisdiction, enabling it to elect for the court that was more favourable to it and thus indulge in forum shopping. Evans L.J. did not go so far in his judgment as to say that the South African courts were not to be regarded as available in these circumstances. But he made it clear that in his opinion the fact that the South African courts were not available until the defendant offered the undertakings, and that their availability remained conditional upon them, were factors which should be taken into account in the application to the case of the principles stated in Spiliada Maritime Corporation v. Cansulex Ltd. [1987] A.C. 460. The implication was that these were factors to be weighed in the balance against the defendant in the decision whether or not the action should be stayed.

    This is not a point that required to be considered in Connelly v. R.T.Z. Corporation Plc. [1998] A.C. 854, and I think that counsel for the defendant was in error when he submitted to the Court of Appeal in the present case that it could have been: [1998] C.L.C. 1559, 1565F. In Connelly's case the two defendant companies, like the defendant in this case, were English companies which had their registered offices in England. But the basis upon which they were being sued in England was that they were responsible, either directly in fact or vicariously in law, for defects in the health and safety arrangements at the mine which was operated in Namibia by a subsidiary of the first defendant by whom the plaintiff was employed while he was working there: see the issues which were identified in the Court of Appeal by Waite L.J.: [1996] Q.B. 361, 364B-D. The subsidiary, against which the plaintiff had previously directed his claim at the suggestion of the first defendant, was present and available to be sued in Namibia. It was common ground that Namibia was a forum that was available to the plaintiff for his claim of damages. No doubt this was on the view that for all practical purposes no distinction was to be drawn between the first defendant, which as my noble and learned friend Lord Hoffmann observed at [1998] A.C. 854, 876G was a multinational company present almost everywhere, and its subsidiary in Namibia.

    In the present case the asbestos mines and mills in South Africa which were operated by the defendant's subsidiaries are all closed, and its subsidiaries are no longer present or available to be sued in that country. The question whether the South African courts are available to the claimants is thus entirely dependent upon the proposition that the defendant itself is subject to the jurisdiction of those courts. As the defendant has no presence in that country, and as it has no assets there which could be attached to found jurisdiction, the only ground on which its courts could exercise jurisdiction against it is that of prorogation. The validity of the defendant's undertakings is therefore critical to its argument that the South African courts are available to the claimants as a forum in which their actions should be tried.

    The approach that is to be taken to this question has been examined in a number of Scottish cases to which it may be helpful to refer, as the underlying principles which Lord Goff of Chieveley described in the Spiliada case were derived from the Scottish authorities.

    In Clements v. Macaulay (1866) 4 M. 583 an objection was taken to the jurisdiction of the Scottish courts in an action to enforce a contract entered into between two Americans on the plea of forum non competens. This was on the grounds that Texas where the agreement was entered into was the only proper forum for the dispute and that the Scottish court was an inconvenient and improper forum. Lord Justice- Clerk Inglis, having concluded that the view that the courts of Texas would have jurisdiction was plainly untenable, said at p. 592:

    "But then I am bound to inquire, if this is an inconvenient and incompetent forum, where is the proper forum? Apart from the suggestion of Texas, no other suggestion is made, and I know no case of a plea of this kind being sustained, where the defender did not satisfy the court that there was another court where the cause could be tried with advantage to the parties and to the ends of justice. The defender does seem to have thought himself under obligation to suggest what was the proper forum, but he has unfortunately suggested one which has no jurisdiction."

At p. 594 Lord Cowan said:

    "Your Lordship has conclusively shewn that there is no jurisdiction in the courts of Texas, on the ground stated by the defender, to entertain this action. Where, then, is the forum on which the defence is founded? When the court has given effect to such a plea, it has always been because another forum, specially referred to by the defender as that in which he undertakes to plead, has been regarded as the more convenient and preferable for securing the ends of justice. Here the elements for disposing of this defence, pleaded on this, its essential ground, do not exist."

In Société du Gaz de Paris v. Société Anonyme de Navigation "Les Armateurs Français" 1925 S.C. 332, 347 Lord Justice-Clerk Alness said that the result of the cases was that it must be plain that "another forum is open to the parties". His analysis of the law was approved by Lord Dunedin in your Lordships' House: 1926 S.C. (H.L.) 13, 18. There is no indication here or in any of the other Scottish cases that this matter ought to be approached on any other basis than that this is a requirement that must be satisfied in a practical manner when the question of forum non conveniens is being considered by the court.

    In Clements v. Macaulay the defender did not offer an undertaking to submit to the jurisdiction of the Texas courts. But in Tulloch v. Williams (1846) 8 D. 657 two actions had been raised against the defender when he was on a visit to Scotland relating to his conduct while acting as the pursuer's commissioner and attorney in Jamaica. He lodged with his defences in each action a minute stating that he was ready and willing to answer in the courts of Jamaica to any writ or action that the pursuer might bring against him with reference to that subject matter. The Lord Ordinary said that he was not aware of any authority for taking the course desired by the defender, which was to decline to proceed with the case in the meantime leaving it to the pursuer to institute proceedings against the defender in the courts of Jamaica. In the absence of such authority he repelled the plea. But he invited the pursuer to consider the defender's offer as providing the most satisfactory and least expensive way of having justice administered between them, saying that to go on with the litigation in Scotland could not fail to be productive of much delay and additional expense. In the Inner House the process was sisted for three months in the light of these observations to allow the pursuer an opportunity to bring an action in the proper court in Jamaica. Lord President Boyle explained at p. 659 that it was a question of convenience whether the case should go on in Jamaica or whether it should proceed in Scotland upon evidence of the law and custom of Jamaica.

    It was not suggested in Tulloch v. Williams that the fact that the defender did not offer to submit to the jurisdiction of the courts of Jamaica until he lodged his defences presented any difficulty, either on the ground that the offer came too late or on the ground that he ought not to be allowed to choose the jurisdiction in which he was to be sued. His undertaking was seen as the obvious solution to the difficulty that, although the most expedient course in the interests of both parties was for the case to be dealt with not in Scotland but in Jamaica, the defender was not otherwise subject to the jurisdiction of the Jamaican courts.

    In Sim v. Robinow (1892) 19 R. 665 the defender was sued in Scotland on the ground that he had been resident there for more than forty days. He maintained that he was only a temporary visitor to Scotland, that he was domiciled in South Africa, that he intended to return to his business in that country and that the courts of that country were the proper forum for determining the matter in dispute as they related to transactions between the parties when they were both in South Africa. His plea that the Scottish courts should decline jurisdiction on the ground of forum non conveniens was repelled. Lord Kinnear, who delivered the leading judgment, said that he was not satisfied that it had been shown that there was another court in which the action ought to be tried as being more convenient for all the parties and more suitable for the ends of justice. In regard to the question whether the courts of South Africa were available, he noted that the defender had not offered the same undertaking as was offered in Tulloch v. Williams. All that he had said was that he intended to go to South Africa, as to which Lord Kinnear observed at p. 669:

    "I do not think that the pursuer can be asked to wait till the defender carries out this intention, or that he ought to be sent to a court which may be unable to exercise any jurisdiction over the defender in consequence of his continued absence from South Africa."

He described Tulloch v. Williams at p. 669 as a very exceptional case and indicated that it ought not to be followed. But this was not because he thought that it was wrong for the court to proceed on the defender's undertaking to submit to the jurisdiction of the other court which he offered after the action had been raised. His criticism of the decision in Tulloch's case was that the court ought not to have sisted the action for a short period to await events, but that it ought to have determined the matter either one way or the other there and then. This was on the ground that, as he put it at p. 669:

    ". . . if this court is not a convenient forum for the trial of the cause, then the action ought to be dismissed, but, if this court is a convenient forum, then I can see no reason why the action should not go on in the ordinary way."

Under Scots procedure a decree of dismissal is a decree which is used when it is intended to decide that the particular action should not be allowed to proceed against the defender, but which is intended to leave it open to the pursuer to bring another action: Maclaren, Court of Session Practice (1916), p. 1093 .

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