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Daad Sharab v Prince Al-Waleed Bin Talal Bin Abdul-Aziz Al-Saud (2012)

Summary

An order allowing service of proceedings out of jurisdiction did not extend to a quantum meruit claim of the restitutionary kind, as, although it had been pleaded in the alternative to a contractual claim, it did not "arise in respect of a contract".

Facts

The court was required to determine whether an order for the claimant (S) to serve proceedings out of jurisdiction was confined to claims made in respect of a contract. The defendant member of the Saudi royal family (P) applied to vary the order so that it would not extend to a claim in restitution.

S ran a consultancy business effecting commercial introductions, mainly for clients in Libya. S brought proceedings claiming a commission for services rendered in relation to the sale of an aircraft owned by P which was intended for Colonel Gaddafi's use. She relied on an oral agreement reached at a meeting in London with P's agent but also claimed, in the alternative, commission upon a quantum meruit basis. P denied that he was contractually bound to pay commission. At a hearing for permission to serve the claim out of jurisdiction, a master granted the order allowing service out as he decided that the first two "gateways" relating to "claims in respect of a contract" had been satisfied. The gateways at the relevant time were CPR 6.20 (5)(a) and (b), namely that the contract had been made within the jurisdiction and made through an agent. The master found that the claim did not fall within gateway 5(c) because he was doubtful whether the agreement was governed by English law.

S maintained that (1) the order allowing service out of jurisdiction applied to the whole of the claim form and particulars of claim and it was not limited to the claim in respect of a contract; (2) S should be permitted to pursue the quantum meruit claim on the footing that it satisfied CPR PD 6B para.3.1(16).

Held

(1) An essential requirement of a claim if it came within gateway 5 was that a contract existed, albeit that it had to be established at trial. In obtaining the court's permission to serve out of jurisdiction, the claimant had to establish that he had a better argument than the defendant. Once, however, the assumption was made that there was no contract between the claimant and the defendant, which was the assumption upon which, as advanced by S, the quantum meruit claim proceeded, it was no longer possible to contend that the claim arose "in respect of a contract". It was irrelevant that it arose as an alternative to a claim which asserted a contract. It was not permissible to elide the two claims to bring the quantum meruit claim within the purview of the contract gateway. Accordingly, the permission to serve the proceedings out of jurisdction on P was confined to those claims which were in respect of a contract. Those claims did not include the quantum meruit claim insofar as it was of the restitutionary (non-contractual) kind (see paras 53-54 of judgment). (2) The acts which gave rise to P's alleged liability took place almost entirely outside the jurisdiction and the few acts which could be identified as having occurred within the jurisdiction played no more than a minor part in the establishment of that liability. Accordingly, the restitutionary claim did not meet the requirements of gateway 16 and the permission sought was therefore declined (para. 77). (3) P's application to vary the order was granted; the permission granted to S to serve the claim form on P out of jurisdiction did not extend to the claim in restitution. That declaration did not affect the quantum meruit claim insofar as it was contractual in nature (paras. 82, 84).

Judgment accordingly

Chancery Division
Sir William Blackburne
Judgment date
29 June 2012
References

​LTL 29/6/2012 : [2012] EWHC 1798 (Ch)