Scottish Court Stays Proceedings in a Business and Human Rights Dispute
On 7 November 2023, less than three weeks after the judgment in Limbu v Dyson Technology Ltd (reported here), where the High Court of England and Wales applied the forum non conveniens doctrine to a business and human rights claim, the Inner House of the Scottish Court of Session (Scotland’s supreme civil court) directed around 5,000 Kenyan tea pickers in Campbell v James Finlay (Kenya) Ltd to pursue their claims for occupational injuries in Kenya (previous judgments in this case included [2022] CSIH 29, which addressed the certification of group proceedings, and [2022] CSOH 57, which concerned a motion for anti-suit interdict).
The case and the Inner House’s judgment are notably unusual for several reasons.
Let’s begin with the facts. The claimants, Kenyan tea pickers, brought proceedings against James Finlay (Kenya) Ltd, a Scottish company, in Scotland. Unusually for a transnational business and human rights dispute, the defendant directly employed the claimants in Kenya. No Kenyan subsidiary or supplier was involved in the alleged wrongs. This enabled the claimants to advance relatively straightforward negligence claims for breach of employer’s duty of care.
Everyone agreed that prima facie the court had jurisdiction under rule 1 in Schedule 8 to the Civil Jurisdiction and Judgments Act 1982, which is a rule of general jurisdiction based on the defendant’s domicile. The defendant challenged the court’s jurisdiction on two grounds: the existence of an exclusive Kenyan choice-of-court agreement and forum non conveniens.
The defendant relied on rule 6 in Schedule 8 to the 1982 Act to argue that the Scottish courts had no jurisdiction due to an exclusive Kenyan choice-of-court agreement. This is an unusual argument as this provision deals with the prorogation, not derogation, of jurisdiction of the Scottish courts, and a foreign jurisdiction agreement does not take away jurisdiction from an otherwise competent Scottish court but serves as a significant factor when deciding whether jurisdiction should be exercised. The court did not engage with these subtleties of Scottish private international law. It promptly dismissed this jurisdictional challenge by concluding, quite rightly, that the contract clause in question (“9. Industrial Sickness: The terms of the relevant national legislation shall apply.”) was not a choice-of-court agreement.
A glaring omission in the judgment is the court’s failure to acknowledge that in employment disputes the jurisdiction of the UK courts depends on sections 15A and C-E of the 1982 Act. These provisions transpose the jurisdictional rules for employment matters from the Brussels I bis Regulation into UK law. Consequently, the Scottish courts had jurisdiction over the Scottish-domiciled defendant (section 15C(2)(a)) and a choice-of-court clause in the employment contract could not deprive the claimants of this forum. The protective jurisdictional rules may be departed from only by an agreement made ex post or expanding the available forums for the employee (section 15C(6)). In other words, there was no need to even look at the dispute resolution clause for the purposes of addressing the first jurisdictional challenge.
The court then proceeded to consider forum non conveniens. The defendant contended that a no-fault compensation scheme established by the Work Injury Benefits Act 2007 in Kenya barred claims for damages, insisting that the claimants should pursue compensation under this scheme.
A preliminary question remained unaddressed: is forum non conveniens available when a UK court has jurisdiction over an employment dispute under section 15C?
The primary aim of sections 15A and C-E was, as articulated in the Explanatory Memorandum accompanying a statutory instrument which was used to transpose the jurisdictional rules for employment matters from Brussels I bis into UK law, “to ensure employees are not disadvantaged by EU exit”. Prior to Brexit, jurisdiction under Brussels I bis was mandatory (Owusu). There are other reasons against the availability of forum non conveniens in this context. It may be inconsistent with the objective of employee protection (for the strength of this objective under sections 15A and C-E, see, for example, Gagliari v Evolution Capital Management). If a foreign choice-of-court agreement can only be effective if made ex post or if it expands the available forums for the employee, allowing forum non conveniens, which is normally a less strong reason for staying proceedings, might seem contradictory. Sections 15A and C-E allow the employee to serve the claim form on the employer as of right in England, eliminating the need to seek permission to serve the claim form out of the jurisdiction. It appears inconsistent not to require the claimant to show that the forum is forum conveniens in service out cases, but to allow the defendant to plead forum non conveniens. Consequently, it is unsurprising that leading scholars (A Briggs, Private International Law in English Courts (2nd edn, OUP 2022) 194 and L Merrett, Employment Contracts and Private International Law (2nd edn), OUP 2022) 165) suggest that forum non conveniens might not be available in this context.
On the other hand, section 49 of the 1982 Act unequivocally provides that “Nothing in this Act shall prevent any court in the United Kingdom from staying, sisting, striking out or dismissing any proceedings before it, on the ground of forum non conveniens or otherwise, where to do so is not inconsistent with the 2005 Hague Convention.” Additionally, there is the authority of Dicey, Morris and Collins, who, in para 12-012, adopt a tentative view that forum non conveniens is available when a UK court has jurisdiction over an employment dispute under section 15C.
It is a shame that the court did not address this preliminary question of the availability of forum non conveniens.
The Lord Ordinary (first instance judge) decided, relying on expert evidence, that the Kenyan Work Injury Benefits Act 2007 did not apply to the claimants because it did not list back injury as a condition for the no-fault compensation scheme. Although the Act did allow for the possibility of the responsible official listing new conditions, no such decision had been made. He further rejected the plea of forum non conveniens because he decided that the claimants would not obtain justice in the Kenyan courts.
The Inner House disagreed. It found that the Act applied to the claimant’s occupational injuries. It further noted that the no-fault compensation scheme “is said to work well and is cost and lawyer free” ([67]). On the basis of all of this, the court held, at [69], that:
Having regard to the court’s construction of the WIBA, the appropriate manner of proceeding is to sist these proceedings pending resolution of the claims under the WIBA, including any appeals to the [Employment and Labour Relations Court], in Kenya. If the court’s construction, or its understanding of the practical operation of the WIBA, turn out to be ill-founded, or if the WIBA claims were not determined in accordance with the scheme, or if there were to be excessive delay, the court may have to revisit the question of substantial justice and consider whether the sist should be recalled. However, the court cannot determine, as matters presently stand, that the WIBA, if it operates as its terms suggest, is not capable of providing substantial justice. The concept of such justice applies to both parties and envelops the general public interest.
Leaving aside the point that the court invoked here a public interest factor, which sits uneasily with the House of Lords decision in Lubbe v Cape Plc, one gains the impression from this paragraph that the court applied a kind of conditional forum non conveniens doctrine.
But then one reads the next paragraph, where the court said that it was not applying forum non conveniens:
The court will recall the interlocutor of the Lord Ordinary dated 11 July 2023 in so far as it repels the defenders’ second plea-in-law (on forum non conveniens). It will allow the reclaiming motion and sist the group proceedings (GP1/22) pending resolution of the group members’ claims in Kenya under the WIBA scheme. It will not determine the plea of forum non conveniens at present.
One is at a loss what to make of this. The court evidently exercised a form of inherent power to sist the proceedings. But there is no attempt to explain the origin or nature of this power or its interaction with forum non conveniens.
All of this amounts to a very confusing (and confused) judgment. Hopefully, the case will find its way to the Supreme Court. The case is just too important to be decided in this way.
— I am grateful to Professor Adrian Briggs and Professor Louise Merrett for sharing their insights regarding the availability of forum non conveniens when a UK court has jurisdiction over an employment dispute under section 15C of the 1982 Act. Additionally, I extend my gratitude to Dr Bobby Lindsay for explaining specific points of Scottish law and for sharing a case note on the first instance judgment in this case, which will be published in the January edition of the Edinburgh Law Review. Finally, I thank Andrew Smith KC and Cameron Smith, who clarified some aspects of this litigation and offered thoughts on the likelihood of obtaining permission to appeal to the UK Supreme Court. Any mistakes or omissions in this post are solely mine.
Quite unbelievable that the Court of Session on the hand analysed Kenyan labour law provisions and on the other missed the special provisions for jurisdiction in employment matters. Also, the suspension of the proceedings until the foreign court has interpreted its own law is highly unusual. It is “forum non convenience in waiting”.
Yes, but the language of s 49 is absolutely clear, and given the ‘or otherwise’ element of it, it is hard to see how the decision made by the Inner House, that it was appropriate to wait and see how a Kenyan court explained and applied Kenyan law, can be criticised for doing something it had no power in law to do.