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The Civil Procedure (Amendment) Rules 2015 were published on 26 February 2015 and came into force on 27 February 2015. They amend the Civil Procedure Rules 1998 for the purpose of implementing certain provisions of the Counter-Terrorism and Security Act 2015.

The amendments are as follows:

• The insertion of a new Part 88 containing rules about proceedings in relation to temporary exclusion orders, particularly where sensitive material is in issue, and it is necessary to ensure that such material is not disclosed where such disclosure would be contrary to the public interest. This includes modification of the application of other Parts of the CPR for the purposes of those proceedings; and
• The amendment of rule 1.2 (application by the court of the overriding objective), so that it is subject to rule 88.2 (modification to the overriding objective). Rule 88.2 modifies the overriding objective for the purposes of Part 88 by placing a duty on the court to ensure that information is not disclosed where such disclosure would be contrary to the public interest and by requiring that the overriding objective be read and given effect in a way which is compatible with that duty. This, and the rest of Part 88, is, however, subject to paragraph 5(1) of Schedule 3 to the 2015 Act, which provides that nothing in the relevant provisions of the 2015 Act or in rules made by virtue of them is to be read as requiring the court to act in a manner inconsistent with Article 6 of the European Convention on Human Rights.

The Civil Procedure (Amendment) Rules 2015 (SI 2015/406)

On 26 February 2015 the US Treasury, Office of Foreign Assets Control (OFAC) announced that it had placed a number of individuals alleged to be connected with Hezbollah on its sanctions list.

According to the official press release, the following actions have been taken:

• Mustapha Fawaz, Fouzi Fawaz and Abdallah Tahini have been designated pursuant to Executive Order (EO) 13224 for acting for or on behalf of Hezbollah;
• Amigo Supermarket Limited, Wonderland Amusement Park and Resort Ltd, and Kafak Enterprises Limited have also been designated pursuant to EO 13224 for being owned or controlled by Mustapha Fawaz and Fouzi Fawaz; and
• Any property or interests in property that the aforementioned individuals or entities may have within the US have been frozen, and US persons have been generally prohibited from dealing with them.

The Specially Designated Nationals List Update of 26 February 2015 has been made availablehere.

On 21 January 2015 the Administrative Court (Laing J) dismissed an application for disclosure by the National Crime Agency (NCA) of letters of request for mutual legal assistance from the US.

The letters of request concerned fraud proceedings against a number of Nigerian defendants. The US had obtained a prohibition order (under Part 4A of the Proceeds of Crime Act 2002 (External Requests and Orders) Order 2005/3184) freezing assets in the UK belonging to the defendants. The defendants applied for disclosure of the letters and argued that the letters lay at the heart of the NCA application; without them the application could not have been pursued at all, and they were therefore disclosable under CPR 31.14.

Laing J held as follows:

• The expectation was that communications between foreign states were confidential for reasons of international comity. It had been confirmed by the US Department of Justice that it wished to maintain the confidentiality of these letters of request. The reason for not ordering disclosure of letters of request, though in some cases it might yield to considerations of justice, was that such letters were confidential.
• There was no legislative requirement that letters of request should be disclosed. The question was whether inspection was necessary for the fair disposal of the action. The defendants had all the material that they needed in order to challenge the order.

National Crime Agency v Abacha [2015] EWHC 357 (Admin), 21 January 2015

On 20 February 2015 the Commercial Court (Leggatt J) emphasised the need for concise documents for the court and the correct nature and content of statements of case.

The case concerned allegations that the defendants conspired to induce the Serious Fraud Office (SFO) to investigate the claimants on a false basis by making statements to the SFO which the defendants did not believe to be true.

Leggatt J held as follows:

• “Statements of case must be concise. They must plead only material facts, meaning those necessary for the purpose of formulating a cause of action or defence, and not background facts or evidence. Still less should they contain arguments, reasons or rhetoric”.
• According to the Commercial Court Guide (8th edition, 2009), statements of case should be limited to 25 pages in length (with extensions to be granted by the court exceptionally and based on good reasons provided by the requesting party). Contentious headings, abbreviations and definitions should not be used. Particulars of primary allegations should be stated as particulars and not as primary allegations. Substantial factual information or lengthy particulars relied on should be set out in schedules or appendices. Evidence should not be included.
• “The particulars of claim which have been served in the present case flout all these principles. They are 94 pages in length. They include background facts, evidence and polemic in a way which makes it hard to identify the material facts and complicates, instead of simplifying, the issues. The phrasing is often not just contentious but tendentious”.
• “…unless adverse costs orders are made in cases of flagrant non-compliance, practitioners who are well aware of the principles of pleading and the provisions of the Commercial Court Guide will continue to overlook them, as happened here. In my view, the appropriate order in this case, and the order which I will make, is that the particulars of claim are struck out, the costs of drafting the particulars of claim are disallowed, and fresh particulars of claim no longer than 45 pages and otherwise complying with Appendix 4 of the Commercial Court Guide should be served within 21 days”.

Tchenguiz & ors v Grant Thornton UK LLP & ors [2015] EWHC 405 (Comm), 20 February 2015

On 20 February 2015 the EU Council issued a joint proposal for a Decision on the EU position regarding an EU-Ukraine Association Agenda.

The proposal sets out a list of priorities for the implementation of the 2014 EU-Ukraine Association Agreement. The draft Association Agenda is annexed to the proposed Decision.

The draft Association Agenda comments on the situation in Crimea (page 15), whereby the EU and Ukraine agree to maintain dialogue and co-operation covering areas including:

2.3: Foreign and Security Policy

(i) Enhancing the co-operation within the CFSP area

Consult and coordinate on actions taken at bilateral and multilateral levels in the framework of international efforts with the joint aim of finding a sustainable political solution to the situation in some regions of Donetsk and Luhansk Oblasts of Ukraine, caused by the illegal activities of the Russian Federation.

On 13 February 2015 the Commercial Court (Richards J) granted the claimants (who were investment funds interested in euro-denominated debt securities issued by Argentina) a declaration that €225 million interest due on debt securities was subject to a trust governed by English law.

The case concerned certain euro exchange bonds governed by a trust indenture and English law. The indenture provided that Argentina irrevocably submitted to the jurisdiction of the English and Argentine courts with respect to any proceedings arising out of or in connection with the indenture as it related to debt securities governed by English law. In the indenture, Argentina also covenanted to pay the principal of and interest on the exchange bonds to the trustee, at the places and times and in the manner provided in the debt securities and the trust indenture.

Richards J held as follows:

• In circumstances where there was so much dispute surrounding the attempt by Argentina to pay sums due on the exchange bonds, a declaration authoritatively stating the position under the governing law of the trust indenture and the euro debt securities was helpful.
• The court was concerned not to intrude improperly into matters before the US courts. However, the making of a declaration in the terms sought by the claimants would not do so. The declaration would establish the status of the funds held by the trustee as a matter of English law. A declaration as to the effect of a trust indenture governed by English law was within the proper jurisdiction of the court.
• A second declaration sought by the claimants, to the effect that a US freezing injunction did not prevent the trustee from paying out of the trust account, was however denied. A declaration in those terms served no useful purpose. It would be a declaration that the trustee would be in breach of trust unless it had a defence.

Knighthead Master Fund LP and others v The Bank of New York Mellon and another [2015] EWHC 270 (Ch), 13 February 2015

The Export Control (Various Amendments) Order 2015 is due to come into force on 24 February 2015. It amends the Export Control (Russia, Crimea and Sevastopol Sanctions) Order 2014 (as well as current Syrian trade restrictions, which are not covered here)

In respect of Russia, Crimea and Sevastopol, the principal amendments are as follows:

• relating to the sale etc. of items listed in Annex II of Council Regulation (EU) No 1290/2014 (the Russia Sanctions Regulation) and related technical assistance, brokering services and financial assistance;
• relating to the provision of certain associated services for certain types of oil exploration and production, as regards Russia;
• a ban on all foreign investments and related investment services in Crimea or Sevastopol;
• a broadening of the former export prohibition on goods and technology suited for use in the sectors of transport, telecommunications, energy and the prospection, exploration and production of oil, gas and mineral resources, and associated technical assistance, brokering services and financial assistance;
• a ban on the provision of technical assistance, or brokering, construction or engineering services relating to infrastructure in Crimea or Sevastopol in those sectors; and
• a ban on the provision of services directly related to tourism activities in Crimea or Sevastopol, including a ban on ships providing cruise services and flying a Member State flag or owned or operated by a Union shipowner calling at certain ports in the Crimean Peninsula.
• the creation of offences and the provision of penalties for contravention of the updated prohibitions in Council Regulation (EU) No 1290/2014 (the Russia Sanctions Regulation) and Council Regulation (EU) No 1351/2014 (the Crimea and Sevastopol Regulation).

The Export Control (Various Amendments) Order 2015, in force 24 February 2014

On 12 January 2015 the Irish High Court (Cregan J) held that the court could consider whether there was an arbitration agreement on a “full judicial consideration” basis rather than on a prima facie basis.

The case concerned an issue of contract formation and incorporation of an arbitration clause between the parties. The key question was whether such issue was for the London arbitration tribunal or whether it could be considered by the Irish courts.

Cregan J held that:

• It was unsatisfactory that a court, having heard the matter, should only consider on a prima facie basis whether an arbitration agreement existed. It would be leaving open the essential question of whether there was an arbitration agreement between the parties on a final and conclusive basis. A finding that an arbitration agreement existed on a prima facie basis meant that the issue may have to be re-argued before the arbitrator as to whether an arbitration clause existed on a conclusive basis. This was unsatisfactory for the court, the arbitrator and the parties, and was wasteful of costs.
• If the court only conducted the analysis to a prima facie review level, and left the matter open to the arbitrator, and if the arbitrator decided whether or not there was an arbitration agreement, that decision was open to challenge by way of appeal on a point of law. The courts could therefore be faced with the prospect of having to decide the issue again. Moreover, in a worse case scenario the parties might have to fight the issue on no less than three separate occasions. This could not be in the interests of proper case management.
• The question of whether there was an arbitration agreement was a question of law which was best decided by a court. The Irish (and other national) courts were well used to considering whether on the basis of the affidavit evidence before them there was a valid and concluded contract in existence between the parties. Moreover, if there were disputed facts on affidavit then oral evidence could be heard before a court to resolve such conflicts of facts.
• Consequently, the court could give “full judicial consideration” to the issue of contract formation at stake in the present case.

The Lisheen Mine v Mullock & Sons (Shipbrokers) Ltd & others [2015] IEHC 50, 12 January 2015

On 12 February 2015 the EU extended one of the exemptions from restrictive measures against Iran until 30 June 2015, by way of Council Regulation (EU) 2015/229. The exemption relates to the execution of obligations provided for in contracts concluded before 23 January 2012, or in ancillary contracts, where the supply of Iranian crude oil, petroleum products or petrochemical products, or the proceeds derived from their supply, are for the reimbursement to EU persons or entities of outstanding amounts.

The EU also relisted two entities based on new statements of reasons, by way of Council Implementing Regulation (EU) 2015/230. They are:

• The National Iranian Tanker Company (NITC) (for allegedly providing financial and logistical support to the Government of Iran); and
• Gholam Hossein Golparvar (for allegedly acting on behalf of IRISL and companies associated with it).

On 5 February 2015 the Court of Appeal held that ss 4(2) (which disapplies the exception to immunity created by s. 4(1) where an individual is not habitually resident in the UK at the time the employment contract is made) and 16(1)(a) (immunity in cases concerning embassy or consular employment disputes) of the State Immunity Act 1978 were incompatible with Article 6 ECHR and Article 47 of the EU Charter (right to a fair trial).

The case concerned two Moroccan nationals employed at the Sudanese and Libyan embassies respectively. They brought claims for unfair dismissal, non-payment of the minimum wage, unpaid wages, breach of the Working Time Regulations 1998, racial discrimination and harassment. The question was whether such claims were barred by state immunity.

The Court of Appeal held that:

• There was conflicting authority on when Article 6 ECHR was engaged. In Holland v. Lampen Wolfe[2000] 1 WLR 1573 the House of Lords held that where the extent of the jurisdiction of a state party to the ECHR was in question it had to be determined first. Therefore, Article 6 was not engaged where the national court did not have adjudicative jurisdiction due to the international rules of state immunity. This view was supported by the House of Lords in Jones v. Saudi Arabia [2007] 1 AC 270. By contrast, in Al-Adsani v. United Kingdom (2002) 34 EHRR 11 (and subsequent cases) the ECtHR proceeded on the basis that Article 6 was engaged and then evaluated the claim to immunity by reference to the concepts of legitimate aim and proportionality.
• In the present case, Holland v. Lampen Wolfe was to be followed. “It is difficult to see how Article 6 can be engaged if international law denies to the Contracting State jurisdiction over a dispute. There can be no denial of justice for which the State is responsible if there is, as a matter of international law, no court capable of exercising jurisdiction. Moreover, Article 6 cannot have been intended to confer on Contracting States a jurisdiction which they would not otherwise possess, nor could it have conferred a jurisdiction denied by general international law in such a way as to be binding on non-Contracting States. It is unfortunate that in none of its many decisions in which the point has arisen has the Strasbourg court grappled with these considerations”.
• However, in the present case the court did not have to choose between these competing approaches. According to the ECtHR a state would not be in breach of Article 6 simply because it gave effect to an international law rule requiring the grant of immunity. The grant of immunity would be held to be a proportionate means of achieving a legitimate aim (i.e. compliance with international law).
• It was necessary to consider whether the immunity of the respondents (under ss 4 and 16(1)(a) SIA) was required by international law or lay within the margin of appreciation accorded to states to determine the extent of their obligations under international law. The answer was in the negative. S. 16(1) granted immunity beyond what was required by international law. S. 4(2)(b) was not required by international law.
• As regards s. 16(1), there was no rule of international law requiring the grant of immunity in respect of employment claims by members of the service staff of a mission in the absence of some special feature, e.g. where the claim was for the recruitment, renewal of employment or reinstatement of an individual, or where the proceedings would interfere with the security interests of the state. No such considerations arose in the present case. The effect of s. 16(1) was a blanket immunity in all cases concerning embassy or consular employment disputes.
• As regards s. 4(2)(b), this limited the exception to immunity in respect of employment contracts, so that immunity was only disapplied where the individual was habitually resident in the UK at the time the employment contract was made. There was no international legal obligation requiring the UK to have such a provision in its national law. Moreover, there were no legitimate objectives which might possibly be achieved by such a limitation on the exception to immunity. The purpose of such an exception seemed to be a need to identify the cases where the UK had a sufficient jurisdictional interest in the claim, based on its interest in adjudicating on the employment law rights of its local work force. Limiting access to justice in this way could not be justified.
• Furthermore, both ss 4(2)(b) and 16(1) infringed Article 47 of the EU Charter (right to effective remedy and fair trial), which had been incorporated into English law following the Lisbon Treaty. In so far as relevant to the present case, the content of Article 47 was identical to that of Article 6 ECHR, so Article 47 was also violated.
• Article 52(5) of the EU Charter stated that the Charter only applied to Member State national courts, and EU institutions and like bodies when they were implementing Union law. However, the present claims fell within the scope of EU law as they were derived from EU law measures (e.g. the Working Time Regulations, discrimination and harrassment).
• An EU Charter right could be relied on “horizontally” in certain circumstances (i.e. despite the fact that Libya was not a Member State of the EU). The right to an effective remedy guaranteed by Article 47 was a general principle of EU law, so that Article 47 had horizontal direct effect.
• In conclusion, based on the breach of Article 6 ECHR the court proposed to make a declaration of incompatibility pursuant to s. 4(2) of the Human Rights Act 1998 as regards ss 4(2)(b) and 16(1)(a) SIA.
• As regards the breach of Article 47 of the EU Charter, the court was bound to disapply ss 4(2)(b) and 16(1)(a) SIA. The applicants would then be able to bring their EU law claims in the English courts.

Benkharbouche & Janah v. Embassy of the Republic of Sudan & others [2015] EWCA Civ 33, 5 February 2015