Lessons from Intesa San Paolo v Regione Piemonte – Dexia Crediop Spa v Regione Piemonte – Message to Foreign Defendants: “Ignore the English Court at your peril!”

18th July 2013

Lessons from Intesa San Paolo v Regione Piemonte – Dexia Crediop Spa v Regione Piemonte – Message to Foreign Defendants: “Ignore the English Court at your peril!”

The recent decision in Intesa San Paolo v Regione Piemonte leaves no room for doubt that even if a party disputes the jurisdiction of the English Court, care must be taken to comply with its procedures and time limits. This is particularly the case in relation to a foreign public authority.

The case concerned claims brought by Intesa San Paolo S.p.A. and Dexia Crediop S.p.A. against the Defendant Regione Piemonte, an Italian local authority, in relation to certain derivative transactions connected with bonds issued by the above named Italian Region.

In the eyes of the English court, the fact that a Defendant is a public body in Italy with special privileges such as the self redress procedure within that state, carries an additional duty upon it, to adhere to English Civil Procedure Rules even more so than they would where an action would lie only before Italian courts.

In his decision to grant summary judgment in favour of the Claimants, in the above named conjoined matters, Mr Justice Eder leaves no room for doubt that judges in England take pre trial conduct very seriously indeed and will regard a “snub” by foreign parties, even public authorities, as a direct offence to the authority of the English court.

In his judgement, Mr Justice Eder regarded “any defendant who deliberately ignores proceedings duly instituted in this court and properly served does so at its peril particularly where the parties have expressly agreed English law and jurisdiction to govern their relationship; and whatever merits might exist in the self redress process instituted by Piedmont in Italy provide no justification whatsoever for the decision by Piedmont effectively to ignore” the English proceedings

Judgement as to Declaratory relief in this case was delivered to Piemonte over 12 months before the case for summary judgement was heard. Despite the fact that Piedmont had notice by September 2012 it did not proceed with an application to set aside the judgment before the end of June 2013. Further, it did so without at this time serving a defence following up its application even in draft form as envisaged in equity in the English jurisdiction. The court in its judgement regarded that delay as sufficient, of itself, to justify the dismissal of the application to set aside.

Moreover, an Italian public authority seeking to shield itself behind the authority of the Italian courts to shut out the jurisdiction of the English courts may indeed be very unpleasantly surprised as was the case here where the Italian Regional Administrative Court of Piedmont refused jurisdiction in the above named cases in favour of the English courts, a fact taken into account in the judgement of the English court in the application for summary judgement as further justification for its decision. .

As a result of the above conduct of the Regione Piemonte, any merits as to substance that its application might have had were not only looked upon in a negative light due to the delay in bringing the application before the court but were also not evidenced sufficiently due to the failure to serve a defence. Even a draft defence would have probably sufficed. Without any pleading, Piedmont lost the opportunity of putting its defence forward. The witness statement filed by the Region was also not sufficient to replace a defence.

It is interesting to note, that Mr Justice Eder would have probably found in favour of Piemonte in respect of its capacity to enter the transactions, if this issue was properly put forward in a defence. Clearly Piedmont lost a great opportunity.

This case should serve as a warning to foreign defendants and particularly local authorities to seek early advice whenever confronted with a claim involving the English Courts.

Co-written by:
Germana Lo Iacono-Smith, a partner at Seddons Solicitors,
germanal@seddons.co.uk 

Konstantinos Konofagos, a lawyer and partner
www.bankingcode.gr

 

This article is a summary of recent developments and, whilst every care has been taken to ensure the accuracy of the information provided, it should not be regarded as a substitute for advice in any particular case. Every case is different and you must not act solely on the basis of information contained here. BILA and the article’s author make no warranties as to the accuracy of the information contained in the article and are not responsible for the content of external websites. Where opinions have been expressed, they are the personal opinions of the author and do not constitute professional advice on any level, nor do they represent the opinions of BILA.