FS Cairo (Nile Plaza) LLC v Brownlie

Factual and Procedural Background

The Appellant, an Egyptian company operating a hotel, was substituted as the defendant in place of another company incorporated in Canada, following a fatal accident during a chauffeur-driven tour booked through the hotel. The Respondent, widow of the deceased, brought claims in contract and tort for personal injury, wrongful death, and dependency losses arising from the accident in Egypt. The initial defendant was found not to be the correct party, leading to the substitution of the Appellant. The English courts were declared the proper forum, and permission was given to serve the claim out of jurisdiction in Egypt via solicitors in London. The procedural history includes multiple appeals addressing jurisdiction and proper parties, culminating in the Supreme Court’s decision that the initial defendant was not liable and permission to correct the defendant’s identity was granted. The current appeal concerns whether the English court properly granted permission to serve the Appellant out of jurisdiction in Egypt, with the English court held to be the more convenient forum. The claims are governed by Egyptian law under applicable EU regulations.

Legal Issues Presented

1. Whether the Respondent's tort claims satisfy the requirements of Practice Direction 6B paragraph 3.1(9)(a) ("the tort gateway") permitting service out of jurisdiction where damage is sustained within England and Wales.
2. Whether the Respondent has a "good arguable case" or a real prospect of success on her claims under Egyptian law.

Arguments of the Parties

Appellant's Arguments

• The tort gateway should be interpreted narrowly, consistent with EU law and the Brussels Convention, requiring direct damage within the jurisdiction.
• The Respondent’s claims do not show direct damage sustained within England and Wales because the injuries and consequential damage occurred in Egypt.
• The Respondent failed to plead or prove the content of Egyptian law adequately, particularly regarding direct tortious and contractual liability.
• The presumption that foreign law is the same as English law (Rule 25(2) of Dicey) should not apply here because the Respondent relies on Egyptian law as the applicable law and there is expert evidence showing differences.
• The Respondent’s failure to plead Egyptian law principles renders the claims unarguable at this stage.

Respondent's Arguments

• The tort gateway should be interpreted broadly, following the majority in the Supreme Court, allowing jurisdiction where significant damage is sustained within the jurisdiction, even if the tortious act occurred abroad.
• The Respondent has a good arguable case of vicarious liability and other claims under Egyptian law, sufficient to permit service out of jurisdiction.
• The default evidential rule (Rule 25(2)) permits reliance on the presumption that Egyptian law is the same as English law where expert evidence on foreign law is incomplete or lacking.
• The Respondent amended the claim to plead Egyptian law and has adduced expert evidence on Egyptian law relevant to limitation and vicarious liability.
• The precise legal basis of liability is a matter for trial and detailed expert evidence, and it is premature to dismiss claims for lack of detailed pleading of Egyptian law principles.

Table of Precedents Cited

Court's Reasoning and Analysis

The court carefully analyzed the interpretation of the tort gateway under Practice Direction 6B para. 3.1(9)(a), focusing on whether the Respondent’s tort claims involved damage sustained within England and Wales sufficient to justify service out of jurisdiction. The majority view, following the Supreme Court majority, was that the tort gateway should be construed broadly, allowing jurisdiction where significant damage is sustained within the jurisdiction, even if the tortious act occurred abroad. The court rejected the narrower interpretation favored by the minority, which would require direct damage within the jurisdiction and exclude consequential or indirect damage.

In assessing the Respondent’s claims under Egyptian law, the court considered the expert evidence adduced by both parties. The Respondent’s expert provided detailed evidence on vicarious liability and limitation but did not address direct tortious or contractual liability under Egyptian law. The Appellant’s expert contended that a commercial contract governed the liability and that tort claims could not be combined with contract claims under Egyptian law (doctrine of cumul), but did not address vicarious liability substantively.

The court examined the procedural and evidential principles governing the pleading and proof of foreign law. It applied Rule 25 of Dicey, which allows, in the absence of satisfactory evidence of foreign law, the court to apply English law as a default evidential rule. The court held that the Respondent was entitled to rely on this default rule for the claims where expert evidence on Egyptian law was absent or incomplete, particularly for the direct tortious and contractual claims, provided the Appellant did not adduce conflicting evidence. The burden to plead and prove foreign law content lies on the party asserting differences from English law.

However, the court found that the Respondent’s draft pleadings were deficient in failing to plead the relevant principles and sources of Egyptian law, especially for claims other than vicarious liability. The court emphasized that while permission to serve out of jurisdiction was properly granted based on a good arguable case, the Respondent should be ordered to amend pleadings to set out the Egyptian law principles relied upon to enable proper case management and facilitate the Appellant’s response.

The court rejected the Appellant’s argument that the tort claims did not satisfy the tort gateway and upheld the broad interpretation allowing jurisdiction. It also rejected the contention that the Respondent had no real prospect of success on her claims, finding a good arguable case based on the evidence and pleadings as they stood, subject to the requirement for further detailed pleading of Egyptian law.

Holding and Implications

The court DISMISSED THE APPEAL, affirming the High Court’s decision to permit service out of jurisdiction on the Appellant in Egypt and to proceed with the Respondent’s claims in the English courts.

The decision confirms the broad interpretation of the tort gateway under Practice Direction 6B para. 3.1(9)(a), allowing jurisdiction where significant damage is sustained within England and Wales, even if the tortious act occurred abroad. It clarifies the application of the default evidential rule regarding foreign law, emphasizing the claimant’s right to rely on English law in the absence of satisfactory evidence of foreign law content, but also the necessity to plead and prove foreign law where contested.

The court directed the Respondent to amend pleadings to properly articulate the principles and sources of Egyptian law relied upon, facilitating case management and fair resolution of the claims. No new precedent was established beyond the application of existing principles to these facts. The ruling ensures that the Respondent’s claims, including those based on vicarious liability and other bases under Egyptian law, may proceed in England, while preserving procedural fairness and clarity regarding foreign law issues.