On 20 August 2010, the Court of Appeal gave judgment on an appeal regarding jurisdiction in the case of Deutsche Bank v Sebastian Holdings, Inc. The substantive dispute involves a claim by Deutsche Bank to $250 million said to be due on FX and equities trading carried out by Sebastian Holdings through the Bank as prime broker. Sebastian Holdings in turn claims over $1 billion from the Bank for breaches of duty by the Bank that have led to substantial losses. Sebastian commenced proceedings first in New York; Deutsche Bank then issued proceedings in the Commercial Court in England.
The dispute involves multiple written agreements, most of which contain jurisdiction clauses. The majority of the jurisdiction clauses choose England but there is also a New York clause.
Sebastian challenged the jurisdiction of the English Court on the basis that, in accordance with the approach in UBS v HSH Nordbank, when the potentially conflicting jurisdiction clauses (ie England versus New York) were properly interpreted and applied to this dispute, the latter fell within the New York jurisdiction clause and not the English jurisdiction clauses.
The Commercial Court (per Paul Walker J) rejected Sebastian's challenge and also (per Burton J) refused to stay the matter on forum non conveniens grounds. In New York, the Bank's jurisdiction challenge was also rejected at first instance. Both sides appealed.
The Court of Appeal has dismissed Sebastian's appeal and held that the English Court does have jurisdiction, and also dismissed the appeal against the refusal to stay the action. The effect of the ECJ ruling in Owusu was argued before the Court of Appeal but not decided by it.
The judgment is here.
Tim Lord QC and Jasbir Dhillon appeared for Sebastian Holdings, Inc.