Two recent developments have made it easier for those litigating in England and Wales to obtain information and documents from third parties outside the jurisdiction: the first is a new jurisdictional gateway for applications for information from third parties outside the jurisdiction; the second is the Court of Appeal’s decision in Gorbachev v Guriev, in which a third-party disclosure order was made against parties outside the jurisdiction in respect of documents within the jurisdiction.
The new jurisdictional gateway
Parties seeking to serve proceedings against defendants outside the jurisdiction must, with few exceptions, obtain the court’s permission to do so. For that permission to be forthcoming, the court must be satisfied that the proceedings in question fall within one of the categories set out in the Civil Procedure Rules, Practice Direction 6B. These categories are known as jurisdictional ‘gateways’.
It has long been a source of frustration that there has been no gateway for applications for third party disclosure orders. This has been particularly problematic in fraud cases where assets have been transferred out of the jurisdiction by anonymous wrongdoers. For victims to be able to bring proceedings with any prospect of recovery, they need information from third parties (often banks) regarding the identity of the wrongdoer and the whereabouts of the stolen assets. Addressing this need was the impetus behind gateway (25), which came into effect last month. This provides for service out of the jurisdiction of applications for disclosure of information from third parties regarding (i) the true identity of a defendant or potential defendant, and/or (ii) what has become of the property of the applicant.
While the gateway will be of particular benefit to victims of fraud, its use will not be limited to such cases. It will inevitably be well-used.
The decision in Gorbachev v Guriev
The claimant applied for an order for disclosure of documents owned by two Cypriot companies but held by the companies’ solicitors in London.
As the companies were domiciled out of the jurisdiction, the court’s permission was required to serve the application out of the jurisdiction. Mr Gorbachev applied for permission under gateway (20), which provides for service out of the jurisdiction where ‘a claim is made under an enactment which allows proceedings to be brought.’ Mr Gorbachev submitted that the ‘enactment’ in question was section 34 of the Senior Courts Act (‘SCA’), which enables disclosure orders to be made against third parties. Permission was granted and the companies appealed.
The appellant companies submitted that an application for a disclosure order did not amount to a ‘claim’ or ‘proceedings’, as required by gateway (20). Secondly, the principle of territoriality requires enactments to apply to all persons and matters within the territory to which it extends, but not to any other persons and matters unless a contrary intention is apparent. Accordingly, the companies submitted, section 34 SCA applies to persons and matters within the UK but not to the companies as they were outside the UK.
The Court of Appeal held that there were no grounds for interpreting the words ‘claim’ and ‘proceedings’ narrowly so as to exclude applications. Accordingly, gateway (20) did apply to applications.
With regard to the application of the principle of territoriality, while the ‘persons’ (ie the companies) were outside the territory, the matters (ie the documents) were within the territory. The Court of Appeal held that, in these circumstances, the principle of territoriality had ‘little or no application’.
The appeal was accordingly dismissed and the permission to serve the disclosure application on the companies upheld.
Meritorious cases have long been thwarted by an inability to obtain relevant information and documents from third parties in a timely manner or at all. These two developments have gone some way to address this. The addition of gateway (25), in particular, is a very significant development and indicates the desire of the judiciary to ensure that England and Wales continues to be an attractive jurisdiction for international litigation.
  EWCA Civ 1270