PRINCIPLES GOVERNING ANTI-SUIT INJUNCTION

PRINCIPLES GOVERNING ANTI-SUIT INJUNCTION

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PRINCIPLES GOVERNING ANTI-SUIT INJUNCTION
PRINCIPLES GOVERNING ANTI-SUIT INJUNCTION

Aapka Consultant Judgment Series- In this series, we are providing case analysis of Landmark Judgments of Hon’ble Supreme Court of India.

Modi Entertainment Network & Anr. v. W.S.G.Cricket Pte. Ltd.

AIR 2003 SC 1177, [2003] 4 SCC 341

JUDGES: Syed Shah Quadri and Arijit Pasayat

Date of Decision:  21-01-2003

FACTS:-

In the instant case, the appellant (based in India) entered into an agreement with the respondent (based in Singapore) under which it got exclusive rights to telecast and sell the commercial rights of the international cricket series on a Doordarshan with restriction to terrestrial free to air telecast on Doordarshan only. Later, the respondent alleged breach of the agreement by the appellant and threatened to discontinue the feed given to Doordarshan. Pursuant to this, both the parties filed an action against each other before the Bombay High Court (by appellant for damages) and before the English Court (by respondent for money decree). However, the jurisdiction clause in the agreement provides that English law would apply and agreed to non-exclusive jurisdiction of the English Courts. To restrain the proceedings before English Court, appellant sought anti-suit injunction against the respondent’s suit before the single bench of the Bombay High Court and got relief also. However it was vacated by a division bench of the High Court. Hence, this appeal arose before the Hon’ble Court.

ISSUES:-

  1. Whether, or not appellant can seek an anti-suit injunction against the proceedings in a Foreign Court on the ground that the Indian court has natural jurisdiction over the subject matter?
  2. Whether, or not parties to the contract can submit dispute to a neutral Foreign Court?

JUDGMENT:-

The learned counsel for the appellants vehemently contended that the Indian Courts are the natural and appropriate forum which had jurisdiction to grant anti-suit injunction and so the Division Bench erred in dismissing the motion. On the other hand, it was pointed out that the parties had clearly stipulated in the contract for resolution of their disputes in accordance with the Foreign Law and in the Foreign Court, therefore, the appropriate forum would be the Foreign Court. The Court found no valid contentions raised by the appellant in support on the ground of appeal.

After making survey of various cases, the Hon’ble Court emerged following principles for anti-suit injunction to layout its conclusion as to subject matter:

  1. In exercising discretion to grant an anti-suit injunction the
  • court must be satisfied of the following aspects : –
  • The defendant is amenable to the personal jurisdiction of the court;
  • If the injunction is declined the ends of justice will be defeated and injustice will be perpetuated; and
  • The principle of comity must be borne in mind.
  1. In a case where more than one forum is available, appropriate forum will be decided at the discretion of the court.

 

  1. Where jurisdiction of a court is invoked on the basis of jurisdiction clause in a contract, the recitals therein in regard to exclusive or non-exclusive jurisdiction of the court of choice of the parties are not determinative but are relevant factors and when a question arises as to the nature of jurisdiction agreed to between the parties the court has to decide the same on a true interpretation of the contract on the facts and in the circumstances of each case;

 

  1. A Court of natural jurisdiction will not normally grant anti-suit injunction against a defendant before it where parties have agreed to submit to the exclusive jurisdiction of a court including a Foreign Court, a forum of their choice;

 

  1. Ordinarily no anti- suit injunction will be granted where parties have agreed to approach a neutral foreign forum and be governed by the law applicable to it for the resolution of their disputes arising under the contract,

 

  1. A party to the contract containing jurisdiction clause cannot normally be prevented from approaching the court of choice of the parties and the proceedings in that court cannot per se be treated as vexatious or oppressive.

 

  1. The burden of establishing that the forum of choice is a forum non-conveniens or the proceedings therein are oppressive or vexatious would be on the party so contending to aver and prove the same.

On adverting to the facts of this case, the parties have agreed that their contract will be governed by and be construed in accordance with English law and they have also agreed to submit to the non-exclusive jurisdiction of English Courts. But it is not a principle rule that once the parties have agreed to submit to the jurisdiction of a foreign court, the proceedings or the action brought either in the court of natural jurisdiction or in the court of choice will per se be oppressive or vexatious. It is the facts of case and material brought before the court which decides the question whether the proceedings in a court are vexatious or oppressive. Here the appellant failed to justify strong reasons with disregard of the contractual obligations of the parties to get anti suit injunction.

Thereby, the Court concluded that the settled principles of jurisdiction of courts under CPC have no applicability when parties to the contract agree to submit dispute to a neutral foreign. Further, whether proceedings are vexatious or oppressive, it is necessary to consider the material facts, the proceedings or the action brought either in the court of natural jurisdiction or in the court of choice.

Thus, the Court found no valid reasons to grant anti-suit injunction in favour of the appellants to restrain proceedings before the Foreign Court and hence, dismissed the appeal accordingly.

HELD:-

It was held that, in considering whether an anti-suit injunction is to be granted or not, the court is to inquire whether the defendant is amenable to the personal jurisdiction of the court, whether the ends of justice would be defeated by refusal to grant the injunction and where there are more than one forums available, and which is the forum conveniens for bringing the action in question having regard to the convenience of the parties and other factors. The court has also to bear in mind the principle of comity.

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