Court has no jurisdiction over restitution and misrepresentation claims where contract void

In Deutsche Bank AG & ors v Asia Pacific Broadband Wireless Communications Inc & ors [2008] EWHC 918 (Comm), the court had to consider whether it had jurisdiction over claims in restitution and misrepresentation, which were pleaded as alternatives to the contractual claim (the alternative claims).

The underlying agreement contained a jurisdiction clause submitting disputes to the English courts. Although the defendants did not object to the court's jurisdiction to hear the contractual claims, they argued that the agreement, and the jurisdiction clause within it, were void on the basis that the signatories lacked authority. The court concluded that, although the alternative claims would fall within the scope of the jurisdiction clause, the claimants could not clearly and precisely demonstrate that there was "a real consensus" between the parties as to the jurisdiction clause in the context of the alternative claims. Accordingly, the court did not have jurisdiction to hear those claims.

The case provides clarification of the principles which must be applied in determining the validity and the scope of jurisdiction clauses, in particular under the Brussels Regulation. The court is entitled to take into account the precise nature of the claims in respect of which the jurisdiction clause is sought to be invoked. Where the effect of those claims (or the defences to them) is to raise an attack on the validity of the underlying agreement, and the jurisdiction clause contained in it, then the clause may not be effective to confer jurisdiction on the chosen court in respect of the particular claims.

Note: The Court of Appeal has allowed an appeal against this judgment. For full details of the Court of Appeal's judgment click here.