Remedies - Negative Declarations - Declaration of Non-Liability

[0] In other words, to obtain a judicial determination, that absolves them from any wrongdoing, fault, blame, liability, debt or obligation to pay, and/or legal requirement to provide a legal remedy (in whatever form).

[1] See McGraw-Hill International (UK) Ltd v Deutsche Apotheker und Artzebank EG [2014] EWHC 2436 (Comm); [2014] 2 Lloyd’s Rep. 523 (Cooke J). For Rules of Jurisdiction in Judgments Regulation (Recast), see: Owners of Cargo Lately Laden on Board the Tatry v Owners of the Maciej Rataj (The Maciej Rataj) (C-406/92) EU:C:1994:400; [1999] Q.B. 515, ECJ) and Folien Fischer AG v Ritrama SpA (C-133/11) [2013] Q.B. 523, ECJ.

[2] A further subdivision, not relevant for the purposes of this article, is between: (a) interim declarations; and (b) final declarations. The focus of this article is on final declarations.

As to interim declarations, briefly, CPR r.25.1 is entitled 'Orders for interim remedies' and r.25.1(1)(b) states that the court may grant an interim declaration, as one of the interim remedies available to it.

'(1) The court may grant the following interim remedies-

(a) ...

(b) an interim declaration'

Commentary on interim declarations can be found in White Book 2024, at paragraph 25.1.15, wherein the learned authors refer to:

(1) R. v Secretary of State for Transport, Ex p. Factortame Ltd (No.2) [1991] 1 A.C. 603, HL

(2) Bank of Scotland v A. Ltd [2001] EWCA Civ 52; [2001] 1 W.L.R. 751, CA

(3) Bank St Petersburg v Arkhangelsky [2014] EWHC 574 (Ch)

(4) ABC v CDE [2010] EWCA Civ 533, CA

(5) JSC BTA Bank v Ablyazov [2010] EWHC 1779 (Comm)

In judicial review proceedings a declaration may be granted as provided by the Senior Courts Act 1981 s.31 and the Crown Proceedings Act 1947 s.21

[3a] In Mexichem UK Ltd v Honeywell International Inc [2020] EWCA Civ 473 ('Mexichem') in the Court of Appeal (Lewison LJ and Floyd LJ), Floyd LJ (with whom Lewison LJ agreed) said, at paragraph 13:

'The court enjoys a broad and flexible discretion to grant declaratory relief where it would serve a useful purpose to do so. A declaration should not be made where it serves no useful purpose, but, subject to that, the approach is one of discretion rather than jurisdiction: see Messier-Dowty Ltd v. Sabena SA [2001] 1 All ER 275 ; [2007] 1 WLR 2040. Before a court can properly make a declaration, the underlying issue must be sufficiently clearly defined to render it properly justiciable: Nokia Corp v InterDigital Technology Corp [2006] EWHC 802 (Pat) at [20 (iii)].'

In Financial Services Authority v Rourke [2002] C.P. Rep. 14 ('Rourke'), after quoting CPR r.40.20, Neuberger J said at paragraphs 16 to 18:

'The court should not...grant any declarations merely because the rights, facts or principles have been established and one party asks for a declaration. The court has to consider whether, in all the circumstances, it is appropriate to make such an order.

In Patten v Burke [1991] 1 WLR 541 Millett LJ stated that, in effect, it was the court's duty “to do the fullest justice to the plaintiff to which he is entitled”, and he went on to hold that there was no rule of law which prevented a declaration of fraudulent conduct.

In Messier-Dowty v Sabena [2001] 1 All ER 275 the issue was whether a negative injunction should be granted. Lord Woolf said this:

“The deployment of negative declarations should be scrutinised and their use rejected where it would serve no useful purpose. However, where a negative declaration would help to ensure that the aims of justice are achieved, the courts should not be reluctant to grant such declarations. They can and do assist in achieving justice. …

So in my judgment the development of the use of declaratory relief in relation to commercial disputes should not be constrained by artificial limits wrongly related to jurisdiction. It should instead be kept within proper bounds by the exercise of the courts' discretion.”'

Drawing this together, Neuberger J in Rourke said at paragraph 19:

'It seems to me that, when considering whether to grant a declaration or not, the court should take into account justice to the claimant, justice to the defendant, whether the declaration would serve a useful purpose and whether there are any other special reasons why or why not the court should grant the declaration.'

[3b] see Regina (Rusbridger and another) v Attorney General [2003] UKHL 38 ('Rusbridger'). Rusbridger was helpfully analysed by Mr Nicholas Thompsell sitting as a Deputy Judge of the High Court in Hellard v OJSC Rossiysky Kredit Bank [2024] EWHC 1783 (Ch) ('Hellard'), wherein he summarised Rusbridger as follows, under the heading 'Should a civil court predetermine a criminal matter?', from paragraph 182:

'I need to consider a line of cases that address the caution needed when a civil court strays into areas which potentially affect criminal liability.

This topic was considered in Regina (Rusbridger and another) v Attorney General [2003] UKHL 38 ("Rusbridger"). In that case the editor and one of the journalists for The Guardian newspaper sought a declaration that they could publish a series of articles advocating republicanism and urging the abolition of the monarchy (but by democratic means without involving any force) without breaching section 3 of the Treason and Felony Act 1848 which made it an offence to "imagine, invent, devise, or intend to deprive or depose" our Queen. This matter was capable of debate both based on the wording of that section and having regard to its interaction with the Human Rights Act 1998 , and particularly the right to freedom of expression under Article 10.

In his speech, Lord Steyn (with whom Lord Scott of Foscote and Lord Walker of Gestingthorpe agreed) considered (at [16]) a principle that had been discussed in Imperial Tobacco Ltd v Attorney General [1981] AC 718. This was that it is not appropriate for a member of the public to bring proceedings against the Crown for a declaration that certain proposed conduct is lawful and to name the Attorney General as the formal defendant to the claim. His Lordship considered, however, that:

"since 1951 [I think this may be a typographical error and that 1981 may be meant] it has become well established that there is jurisdiction for a civil court to make such a declaration… But the exceptional nature of such a declaration by a civil court has on a number of occasions been emphasised."

Lord Steyn went on to consider first a threshold condition that the applicant for relief has an interest in or other standing in the issue, which he considered was the case in the matter before him.

Next, he considered three criteria necessary for the case to fall within the exceptional category.

The first criterion was whether there was any genuine dispute. The Attorney General in that case offered what might be described as a " Catch-22 " analysis, arguing that there would be a dispute if the Attorney General threatened to prosecute. In that event no claim for a declaration would be possible because there would be an imminent threat of prosecution. On the other hand, if the Attorney General simply declined to indicate any view (as was the case there) there was no dispute. Lord Steyn did not see the absence of a dispute as concluding the matter or to be a "weighty criterion" if there were otherwise good reasons to allow the claim for a declaration to go forward.

The second criterion was whether the case is fact sensitive or not. Lord Steyn thought that most claims for a declaration would founder on this ground. However, questions of pure law may more readily be made the subject matter of a declaration.

The third criterion was whether there was a cogent public or individual interest which could be advanced by the grant of a declaration.

190. Having considered these issues, Lord Steyn considered that the case before him fell within the exceptional category, but nevertheless refused to allow the relief requested on the basis that it was obvious that section 3 could not survive scrutiny under the Human Rights Act 1998 and the courts ought not to be troubled further with this "unnecessary litigation". This was a point that all their Lordships agreed with: none of them considered that The Guardian or its journalists were under any real danger of prosecution or conviction or that the existence of the 1848 act had caused any of them " to sleep in their beds less soundly."

Lord Roger of Earlsferry placed more reliance on the fact that the claimants were unaffected in their actions or in their well-being by the existence of section 3 of the 1848 Act. He acknowledged the principle in Imperial Tobacco but considered (at [56]) that the authorities do not spell out what constitutes an exceptional case for those purposes, rather:

"in ordinary cases people must take and act on their own legal advice. So, broadly speaking, a very exceptional case must be one where, unusually, the interests of justice require that the particular claimant should be able to obtain the ruling of the civil court before embarking on, or continuing with, a particular course of conduct which, on one of you might expose him to the risk of prosecution".

He considered the case before him did not meet that test as there was no real risk of prosecution in that case.'

Mr Thompsell in Hellard also summarised the cases of:

(a) Regina (Haynes) v Stafford Borough Council [2006] EWHC 1366 (Admin); and

Mr Thompsell in Hellard said, at paragraphs 194-195:

'Regina (Haynes) v Stafford Borough Council [2006] EWHC 1366 (Admin) is a case where the court was prepared to issue declarations involving the determination by the administrative court of questions which could call for consideration by a criminal court if criminal proceedings were brought. Walker LJ considered the question whether it is permissible and appropriate for him to pronounce on questions which potentially affect criminal liability. In this he had regard to Attorney General v Able [1984] QB 795 where Woolf J (as he then was) said it was important that the courts should bear in mind the danger of usurping the jurisdiction of the criminal courts and the observation of Viscount Dilhorne in Imperial Tobacco that only in a very exceptional case would it be right for a civil court to make a declaration as to the criminality or otherwise of future conduct.

Walker LJ, after considering relevant legal textbooks and an academic article, identified certain relevant propositions, although he was careful to say that he was not setting out a code of general application, but merely propositions that had relevance to the case before him. His propositions may be summarised as follows:

i) The High Court has jurisdiction to make a declaration as to whether a criminal offence has been committed or may be committed in the future, but it is only to be exercised in exceptional circumstances. The court should adopt an essentially flexible approach in deciding this. The only rigid rule is that once criminal proceedings have begun the court should not intervene.

ii) The extent to which cases are fact-sensitive or not is a factor of great importance – a question of pure law may more readily be made the subject matter of a declaration.

iii) It will be relevant to consider the extent to which there is a cogent public or individual interest which could be advanced by the grant of a declaration.

iv) It will only be proper to grant a declaration if it is clearly established that there is no risk of treating conduct as criminal which is not clearly in contravention of the criminal law.

v) There may be a distinction between declarations that conduct is criminal and declarations that conduct is not criminal. If a court declares what conduct will be criminal, it may be considered to be performing the task of the jury in a criminal trial. However, if the court rules that conduct is not criminal, it is performing a similar function to the judge at a criminal trial who stops the case on a submission of no case to answer.

vi) The courts should be particularly wary of embarking on this jurisdiction otherwise than at the suit of the Attorney General; the court should be particularly cautious wary proposed declaration involves existing, rather than prospective future conduct.'

(b) Transport for London v Uber London Limited [2015] EWHC 2918 (Admin).

Mr Thompsell in Hellard said, at paragraph 196:

'I was also referred to Transport for London v Uber London Limited [2015] EWHC 2918 (Admin) as another case where the court (Ousely J, sitting in the Administrative Court) felt it appropriate to grant a declaration in relation to a matter that would be determinative of whether a regulatory offence was being committed. In doing so he had regard to: the importance of the issue; that the declaration being sought was not one that certain conduct is criminal; that the relevant regulator (Transport for London) was pressing for a declaration; and that there were no current criminal proceedings.'

[3c] Certain areas of law have additional authorities on the application of ingredients for a declaration. One very narrow example of this, arose in Mexichem. In Mexichem, the Court of Appeal considered, in patent law, when a Court should issue an Arrow Declaration:

(a) the appellant Honeywell was the patent holder and (unsuccessful) applicant for an order (amongst other things), striking out Mexichem claimant/respondent (to the application and later appeal)'s application for a declaration that use of 2 chemicals as refigerants was obvious, from two dates in the past.

(b) as to what an Arrow Declaration is, Floyd LJ said, at paragraph 6:

'A declaration in the form sought by Mexichem has come to be called an Arrow declaration because it was in Arrow Generics Ltd v Merck & Co Ltd [2007] EWHC 1900 (Pat); [2007] F.S.R. 39 that Kitchin J. (as he then was) allowed the first such declaration to proceed to trial. Since then, the court's discretionary power to grant Arrow declarations in appropriate cases has been reviewed by this court in two cases: Fujifilm Kyowa Kirin Biologics Co Ltd v AbbVie Biotechnology Ltd [2017] EWCA Civ 1; [2017] R.P.C. 9 and in Glaxo Group Limited v Vectura Ltd [2018] EWCA Civ 1496; [2019] R.P.C. 2. It is now settled that such declarations may in principle be granted where justified by the circumstances.'

(c) Honeywell's strike out application was based on a number of grounds. Floyd LJ said, at paragraph 5:

'Honeywell objects to the declarations on a variety of grounds. It complains that the declaration is not sought in relation to a specific product or process which Mexichem intends to market in the UK, that it is not suffiiciently clear, and that a declaration in these broad general terms lacks any utility. It contends that this is so clear at this interim stage that the court should not even allow it to go forward to trial.'

(d) On the question of whether an Arrow Declaration will be useful, to an applicant/claimant competitor to a patent holder, Floyd LJ said, at paragraph 14 onwards:

'A party which is endeavouring to market a product, and find a way through a complex network of patent protection owned by one of his competitors will, of course, find it useful for a declaration to be made that every aspect of its product is old or obvious at a particular date, so that no patent having a later priority could ever validly cover its manufacture or sale. Even in such a case, however, it is impossible to ensure that there is no feature of the product (e.g. one of which the patentee and the court were unaware at the time the declaration was granted) which could still be validly protected. That is why the declaration, in order to be clear, has to operate in relation to specific features and combinations of features of a product.

(e) as to clarity of the declaration, Floyd LJ said, at paragraph 15:

'Thus, dealing with the clarity of the declaration, I said this in Glaxo Group at [30]:

"30. There is no dispute that the declaration must be formulated with clarity. The facts ultimately declared by the court must be clear, otherwise the declaration will simply give rise to further dispute and defeat the purpose for which it is granted. The declaration must also be clear so that the court can know what technical issues it has to decide. The declaration must therefore identify the combination of features of the products and processes in question on which the assessment of obviousness is to take place."

In that case Glaxo Group sought declarations based either on three specific features of a process ("the general declaration"), or on all the features of a process set out in a product and process description ("the PPD declaration"). At [32] I said:

"I do not accept that it is clear at this stage that either the general declaration or the PPD declaration is so unclear that it could not be granted. In each case GSK would have to establish that the relevant features were old or obvious at the level of generality at which they are pitched."

Finally, at [34], I said that it was clear from Arrow and the subsequent cases that there was no requirement that the declaration should identify all the features of the product or process.

There is no threshold requirement for the grant of an Arrow declaration that the party seeking it must have a fully formulated product description, far less that it must have a product in actual production. What must be established at trial is that it would be useful for specified features of a product which the party wishes to sell to be declared old or obvious. The extent of generality or particularity of the declaration may affect the utility of the declaration. That, however, is plainly a matter of degree which it will be for the trial judge to assess. At this stage, namely that of striking out or summary judgment, it is enough for the party seeking the declaration to show that there is a real prospect of its being able to establish those matters at a trial.'

[4a] Section 19 of the Senior Courts Act 1981 is entitled 'General jurisdiction of High Court' and section 19(2) provides:

'Subject to the provisions of this Act, there shall be exercisable by the High Court-

(a) all such jurisdiction (whether civil or criminal) as is conferred on it by this or any other Act; and

(b) all such other jurisdiction (whether civil or criminal) as was exercisable by it immediately before the commencement of this Act (including jurisdiction conferred on a judge of the High Court by any statutory provision).'

CPR r.40.20 is relevant, but it not the source of the Court's power to give declaratory relief. CPR r.40.20 is entitled 'Declaratory Judgments' and reads:

'The court may make binding declarations whether or not any other remedy is claimed.'

The above rule seemingly just deals with the short point, that the Court can make a declaration on its own (i.e. as the only remedy bestowed), or as one amongst a range of remedies bestowed. Generally though, declarations are sought and granted together with other forms of relief. However, Cockerill J's judgment in Trattamento, when it mentions CPR R.40.20, seems to place more importance on the rule, than this 'short point'.

[4b] Section 38 of the County Court Act 1984 is entitled 'Remedies available in county courts' and subsection 38(1) reads:

'Subject to what follows, in any proceedings in the county court the court may make any order which could be made by the High Court if the proceedings were in the High Court'

Nothing in the other subsections to section 38 seem relevant, but for completeness, the rest of section 38 is as follows:

'(2) Any order made by the county court may be-

(a) absolute or conditional;

(b) final or interlocutory.

(3) Neither the county court nor the family court has power-

(a) to order mandamus, certiorari or prohibition; or

(b) to make any order of a prescribed kind.

(4) Regulations under subsection (3)-

(a) may provide for any of their provisions not to apply in such circumstances or descriptions of case as may be specified in the regulations;

(b) may provide for the transfer of the proceedings to the High Court for the purpose of enabling an order of a kind prescribed under subsection(3) to be made;

(d) may make provision amending or repealing any provision made by or under any enactment, so far as may be necessary or expedient in consequence of the regulations; and

(e) may make different provision for different purposes.

(4A) If regulations are made under subsection (3), rules may be made in accordance with Part 1 of Schedule 1 to the Constitutional Reform Act 2005 about procedure relevant to the matters prescribed in the regulations.

(5) In this section “prescribed” means prescribed by regulations made under this section by the Lord Chancellor after consulting the Lord Chief Justice.

(6) The power to make regulations under this section shall be exercised by statutory instrument.

(7) No such statutory instrument shall be made unless a draft of the instrument has been approved by both Houses of Parliament.'

For those interested, there are rules specific to search orders and freezing injunctions. See County Court Remedies Regulations 2014/982, which replaced the County Court Remedies Regulations 1991 (SI 1991/1222).

[5a] In Financial Services Authority v Rourke [2002] C.P. Rep. 14, after quoting CPR r.40.20, Neuberger J said at paragraph 16:

'Accordingly, so far as the CPR are concerned, the power to make declarations appears to be unfettered. As between the parties in the section, it seems to me that the court can grant a declaration as to their rights, or as to the existence of facts, or as to a principle of law, where those rights, facts, or principles have been established to the court's satisfaction. The court should not, however, grant any declarations merely because the rights, facts or principles have been established and one party asks for a declaration. The court has to consider whether, in all the circumstances, it is appropriate to make such an order.'

For a recent example of a negative declaration being given, not in respect to whether somebody is liable or not, but on the application of the law to a certain scenario, see Hellard v OJSC Rossiysky Kredit Bank [2024] EWHC 1783 (Ch), wherein the Court acceded to an application to issue a negative declaration, that Trustees in Bankruptcy could count/accept votes exercised by unsecured creditors of the bankrupt. That to do so, would not involve the Trustees in Bankruptcy contraving the Russia (Sanctions) (EU Exit) Regulations 2019 (made under the Sanctions and Anti-Money Laundering Act 2018) because the unsecured creditors were Russian Banks. Nicholas Thompsell (as he then was), sitting as deputy Judge of the High Court, said at paragraph 206:

'The court should make a declaration in broadly the following terms (again the wording of which is to be confirmed in an order of the court). The voting rights of creditors under a creditors' decision procedure under the bankruptcy provisions of IA 1986 and the Insolvency (England and Wales) Rules 2016 and the rights of creditors to participate in and vote at a creditors' committee under section 301 IA 1986 and Part 17 Insolvency Rules 2016 do not constitute "funds" or "economic benefits" for the purposes of the 2019 Regulations and using such rights or accepting any such votes do not amount to dealing with "funds" or with "economic benefits" for the purposes of the 2019 Regulations.'

[5b] In BNP Paribas SA v Trattamento Rifiuti Metropolitani SpA [2020] EWHC 2436 (Comm), Cockerill J, at paragraph 69, said of the judgment of Lord Woolf in Messier-Dowty v Sabena [2000] 1 WLR 2040 (particularly, paragraphs 36-41):

'This was a judgment which was plainly designed as a "re-set" of the jurisdiction. It involved specifically "treating with reservation" the more adverse views of Kerr L.J. in First National Bank of Boston v. Union Bank of Switzerland [1990] 1 Lloyd's Rep. 32, 38 and in Saipem S.p.A. v. Dredging VO2 B.V. [1988] 2 Lloyd's Rep. 361, 371. Against this background it seems to me that it is acceptable to pay less mind than one would usually do to older authorities which strike much the same note. Thus Camilla Cotton should perhaps not be seen as the best source for statements of principle; however in truth, I do not see anything in Camilla Cotton which is out of step with this approach. To the extent that [counsel for TRM] sought to draw out of it statements of principle which went further than this, I do not consider that those principles can safely be drawn out of the case.'

[6] In Messier-Dowty v Sabena [2000] 1 WLR 2040, Lord Woolf explained, at paragraphs 11 and 12:

'The particulars of claim which were delivered set out fully the claim for the declarations. They refer to the contract for the design, development and supply of the landing gear as being concluded between [D] and [BAA] "acting for and on behalf of [A]." It also refers to various obligations of [BAA] under that contract. It alleges that [A] and/or [BAA] were in breach of contract and negligent in the data which they provided to [D]. The particulars also include an allegation that [D] have suffered and will continue to suffer loss and damage in respect of which they are entitled to seek compensation and a declaration of indemnity. As particulars of this allegation, it is alleged that there is a clear risk that [D] will be joined in proceedings arising out of the failure or potential failure of landing gear of other aircraft and that [D] have already incurred legal costs in connection with the "likely assertions of liability by [S]."

The particulars of claim accept that [D] owe a duty to prospective owners of [A] aircraft but contend that duty was discharged and the damage to the aircraft did not arise through any negligence on their part. [D] also claim to recover from [BAA] and/or [A] compensation for the substantial work which they have carried out to establish the cause of the accident and the implications for the reliability of landing gear on other [A] aircraft and for the supply of spare parts etc. This is therefore a claim against [A] or [BAA] for work done and materials supplied.'

[7] The declarations sought against each of S, A and BAA were not exactly the same - see Messier-Dowty v Sabena [2000] 1 WLR 2040, paragraph 9.

[8] In Messier-Dowty v Sabena [2000] 1 WLR 2040, Lord Woolf explained the second submission put forward by S's counsel on the application, at paragraph 15:

'The second submission was that as [S] is domiciled in Belgium and this case does not fall within any of the exceptions to article 2 of the Brussels Convention the English courts do not have jurisdiction over [D's] claims.'

This second submission, and Lord Woolf's view of the underlying point, was set out in Messier, from paragraphs 16 to 33.

[9] In Messier-Dowty v Sabena [2000] 1 WLR 2040 ('Messier'), Lord Woolf quoted (paragraph 34) from Advocate General in the case of Owners of cargo lately laden on board the ship Tatry v. Owners of the ship Maciej Rataj (Case C-406/92) (Note) [1999] Q.B. 515, 526, as an accurate statement of the law in relation to the then Brussels Convention, before stating:

'The approach reflected in the decision in the Tatry case can be contrasted with the less sympathetic consideration which is sometimes given to the use of negative declarations in transnational litigation by English courts.'

Lord Woolf then referred to an article, entitled 'The Negative Declaration in Transnational Litigation' (1995) 111 L.Q.R. 674, as commenting on the situation as it existed in 1995. Lord Woolf said that Dr Bell, the author of the article, had:

'..concluded that the form-of relief sought should not affect the assessment of the jurisdictional propriety of the chosen forum. He added, at p. 695:

"As far as the impact of this form of relief on the interests of comity is concerned, it has been argued that the problems created by negative declarations are the problems of concurrent litigation in general. If it is the case that the right to initiate litigation should not be the exclusive preserve of those parties seeking to vindicate positive rights, then the problem of multiple litigation must be addressed in a way that does not simply entail the emasculation of a long-established and potentially useful form of action. There is no valid reason to penalise one prospective party and not the other in relation to matters which may be as strategically critical in a transnational dispute as the timing and venue for litigation."

At paragraph 36 of Messier, Lord Woolf said that '[t]here is force in these comments.'

[10] In Messier-Dowty v Sabena [2000] 1 WLR 2040, Lord Woolf referred to In re Clay [1919] 1 Ch. 66, and:

'...the fact that it was followed in Midland Bank Pic. v. Laker Airways Ltd. [1986] Q.B. 689 by Lawton L.J., with whom Dillon and Neill LJJ. agreed. Lawton L.J. stated, at pp. 700-701:

"As the liquidator has never threatened to take proceedings against either bank in the English courts, on the authority of in In re Clay [1919] 1 Ch. 66, there is no jurisdiction in the court to make the declarations asked for." (Emphasis added.)

This approach was applied by Timothy Walker J. in New Hampshire Insurance Co. v. Aerospace Finance Ltd. [1998] 2 Lloyd's Rep. 539.' (paragraphs 37 and 38)

[11] The basic facts of Camilla Cotton Oil v Granadex SA [1976] 2 Lloyd's Rep 10, where, as described by Cockerill J in BNP Paribas SA v Trattamento Rifiuti Metropolitani SpA [2020] EWHC 2436 (Comm), at paragraph 62, namely:

'Camilla Cotton was a case concerning a sale of peanuts where declarations were sought regarding the question of agency in the context of there being extant Swiss proceedings whose object was to establish liability, so were effectively a mirror image of the declaratory proceedings.'

[12] In Camilla Cotton Oil v Granadex SA [1976] 2 Lloyd's Rep 10, Lord Wilberforce, in the course of a judgment refusing the declarations, stated as follows:

"The declaration claimed is of a negative character and as Lord Sterndale himself had said a declaration that a person is not liable in an existing or possible action is one that will hardly ever be made. "Hardly ever" is not the same as "never" but the words warn us that we must apply some careful scrutiny. So I inquire whether to grant such a negative declaration would be useful….

…In order to appraise the utility, or otherwise, which a declaration as to the position in English law might possess in Switzerland, it is necessary to examine the claims there made…. Under none of these heads, or otherwise, is there, I repeat, any reliance on English law. English law has, at a late stage in the proceedings, been invoked by the respondents (defendants in Switzerland),…This being the position, not I hope unduly simplified, can it be said that there is any utility, from the point of view of the Swiss proceedings, in allowing the claim stated in par. 1 of the writs to proceed? In my opinion there are several reasons why there is not….

….it is in principle undesirable that, when an issue of English law is raised, or raisable, in foreign proceedings, the English law to be applied should not be left to be proved in the normal manner by expert evidence in the foreign forum. The alternative, of having it proved by an ad hoc judgment in contested proceedings here is likely to be lengthier, more expensive (they might involve appeals to the Court of Appeal or even this House) and less clear and helpful to the foreign Court. The issues (if any) of English law which might arise for consideration in Switzerland are in themselves simple enough even though capable of some debate, and entirely suitable for expert exposition with text books and authorities."

[13] In Messier-Dowty v Sabena [2000] 1 WLR 2040, Lord Woolf concluded that S ought not to have been joined to the English proceedings (as the situation then stood). Lord Woolf said, at paragraph 46:

'Looking at the situation as a whole, the conclusion which I have come to is that, as an issue of domestic law alone, the joinder of [S] at this stage is not justified and is inconsistent with resolving the English proceedings justly. [S] should therefore, unless this would be inconsistent with the policy of the Convention, be dismissed from the proceedings. This would be a procedural decision taken in the light of the position as it now is and therefore a decision which could be reconsidered by the English courts if the position should change in consequence of [S] making a claim or being in a position to make up its mind as to whether to claim directly against [D].'

[14] In BNP Paribas SA v Trattamento Rifiuti Metropolitani SpA [2020] EWHC 2436 (Comm) ('Trattamento'), Cockerill J recalled the arguments put before her, at paragraphs 63 to 65, as follows:

'63. TRM submitted that the court's caution regarding the grant of negative declaratory relief applies particularly in the context of foreign proceedings. In such cases, the English court is concerned that in the case of any negative declarations which might otherwise be made, there should not be an "undesirable side-effect" of interference in ongoing foreign proceedings. Reference was made to Bank of New York Mellon, London Branch v Essar Steel India Ltd [2018] EWHC 3177 (Ch) at [22] – [23]. This was said to be authority for the proposition that if and to the extent foreign proceedings were in issue that was a strong indicator that a declaration should not be made. Reference was also made to passages from Zamir & Woolf and the case law emphasising the need to establish clear utility for the declaration.

64. TRM submitted that the underlying issue must be sufficiently clearly defined to render a claim for a negative declaration properly justiciable by reference in particular to Nokia Corporation v InterDigital Technology Corporation [2006] EWHC 802 (Pat) at [20 (iii)] applied in Mexichem UK Limited v Honeywell International Inc. (a company incorporated under the laws of the State of Delaware, USA) [2020] EWCA Civ 473 at [13].

65. TRM also placed emphasis on the case of Prince plc v Prince Sports Group Inc [1998] F.S.R. 21 where Neuberger J refused to grant declarations in respect of which the plaintiff had led no evidence and which might be used in foreign (US) proceedings brought by the defendant against it. Again this was both as to the refusal of a declaration where foreign proceedings were in issue and the need for this court to understand, based on evidence, the utility of what was being sought. It was submitted that the onus is on the Claimant to put forward positive evidence to support claim and why the grant of negative declaratory relief would be useful and fair.'

Under the heading 'Discussion', Cockerill J in Trattamento said, at paragraphs 70 to 78:

'70. So far as the issue of whether there should be a reluctance to grant negative declaratory relief in cases involving foreign proceedings, I am not persuaded by TRM's submissions. The cases on which reliance was placed were cases which had a far less clear connection with this court - for example where the foreign process in question involved a third party not before the English Court. They were not cases such as this, where there is an issue about the effect of a contract which contains an exclusive jurisdiction clause in favour of the English Court, and which is governed by English Law. While [counsel for TRM] is quite right that one must be careful not to assume that the proceedings in Italy are themselves in breach of the exclusive jurisdiction clause, it equally must be right that the existence and effect of that clause vis à vis the Transaction should not be allowed to be forgotten.'

71. Further, as BNPP noted, there are plenty of examples of such declarations being granted in this court in cases with broadly similar issues. It drew attention in particular to two cases which were said to be akin to, but weaker, cases than the present.

72. In JP Morgan Europe Ltd v Primacom Management GmbH [2005] EWHC 2426 (Comm), Cooke J granted declarations as to the enforceability and validity of a Senior Facility, subject to English law and the exclusive jurisdiction of the English courts, in a case where there was also a second facility with the same lender. There were extant proceedings in Germany in relation to that second loan facility, but not in relation to the first. Because German law was more favourable to the Defendant there was a fear that attempts might be made to damage or impair the contractual rights under the senior facility by proceedings brought in Germany and by reference to German law particularly given a history of the borrowers having previously brought proceedings against the lenders in breach of exclusive jurisdiction clauses. The seeking of negative declaratory relief was effectively a bid to pre-empt an attempt to damage or impair that facility when there was no dispute yet as regards it. However, as [counsel for TRM] pointed out, that was a case where the dispute was not a vibrant one - the parties had essentially agreed to a form of appropriate relief if in principle declaratory relief was available.

73. The Claimant also pointed to Merrill Lynch v Commune di Verona [2012] EWHC 1407 (Comm) in which Teare J granted a series of declarations (on an application where there was no representation by the Defendant) in respect of a swap under an ISDA Master, in circumstances where the counterparty Italian local authority had threatened to issue proceedings for alleged overpayments and commission (but had not yet actually done so). The Judge set out key questions at [17] and held (at [26]) that there was "a clear and present dispute between the parties", even though no proceedings had been issued in Italy, and further (at [30]) that the Claimant had a "legitimate interest in ensuring that the parties chosen forum, this court, resolves disputes concerning the transactions."

74. Having said that Teare J declined to order two of the declarations sought. At [37-42] he said this:

"37. These two declarations do not derive from the representations and terms of the transactions. They are wide-ranging; in short, a declaration that the claimants have no liability to the defendants of any sort whether, contractual, tortious, fiduciary or of any other nature.

38. No evidence has been led on this topic for the very obvious reason that the defendant has not advanced any case that the claimant has acted in breach of any duty to the defendant.

39. Although the absence of evidence is understandable, the fact is that the court is being asked to make a declaration of non-liability in the absence of any evidence on the question. That seems to me to be a serious obstacle in the claimant's way …

42. … I am not persuaded that it is appropriate for the court to make declarations when there is no evidence to support them. I must therefore refuse to make declarations 12 and 13."

75. BNPP suggested that these cases offered powerful parallels. As to the JP Morgan case, I am not persuaded that that is quite the case. While there are some parallels with this case, those parallels are not striking; that was a case where the claim had not been objected to, it was not a case concerning ISDA, and while no proceedings in relation to the relevant facility had been launched, there was evidence of material facts.

76. As for the Merrill Lynch case, while the facts were plainly much closer in that it was a case which concerned the ISDA Master, combined with threatened proceedings in Italy (though there only threatened), I would nonetheless treat that authority with somewhat less enthusiasm than if it were a case where the declaratory relief had been the subject of argument. Further it seems to me that the caution demonstrated by Teare J in that case in refusing certain of the declarations in the absence of evidence is a not insignificant point.

77. So while I decline to follow the course urged by [counsel for TRM] of regarding cases where foreign proceedings are in issue as per se requiring extreme caution – and the less so where the declarations relate to a contract governed by English Law and subject to an EJC, I also consider that these two somewhat parallel authorities do not solve the equation for me.

78. Overall I conclude that the interesting argument which I have heard on the authorities has been in danger of over-refining an exercise which is essentially discretionary.'

[15] In BNP Paribas SA v Trattamento Rifiuti Metropolitani SpA [2020] EWHC 2436 (Comm), Cockerill J explained her reasoning, as follows, in paragraphs 202 to 209:

'There are a number of facets which feed into my conclusion.

The first is the caution appropriate to approaching a negative declaration. I need to be persuaded that it is appropriate to make this declaration despite the reversal of roles inherent in this type of declaration. Another is the question of utility. There are two facets to this. One is the question of the focus of the declaration. Here, while there are proceedings on foot, the declaration is sought essentially as an insurance against issues which may arise in future. There is no question of pointing to some point or points in the Italian proceedings and saying " this is why we need this " – or even saying that that the logical next step from something at present in the proceedings will directly call this point into issue. The issue is not entirely hypothetical, because of the existence of proceedings with a broad focus, but it is at best contingent. It is not like the declarations which mirror actual terms – those terms are specifically pleaded and specifically in issue in the Italian Claim. Here I bear in mind the line indicated in Zamir & Woolf at 4- 182 as well as the caution exhibited on this subject by Teare J in Verona.

I am troubled by the breadth of the language used, and the absence of tie demonstrated to any specific claim or argument (actual or anticipated). That seems to come close to Zamir and Woolf's second category of a dispute divorced from the facts. The words " any claim relating to the Transaction " are so broad as to potentially encompass, notwithstanding the amended (by deletion) wording, claims which would fall within the scope of the FA. Similarly wording such as " in respect of" ; " including but not limited to " (wording described by Mr Samek as "beloved of lawyers but a recipe for confusion" ); " including without limitation " provide indications, which are not effectively negatived, of an uncertain ambit. Those are reinforced by the references to claims arising in relation to "the circumstances of the Defendant's entry into" the Transaction, which given the factual background offers obvious scope for lack of clarity.

Here I find echoes of what was said in the Prince case about the risk that the granting of additional relief could itself create a confusion which would not otherwise arise. There Neuberger J noted that if a declaration added nothing, the fact of its having been granted might lead another court to think (wrongly) that it did add something; and that conversely if a declaration does take matters further the reason why it is needed should be clear – and if it is not, there is a danger of confusion. Another sidelight from the authorities is the point made by Floyd LJ in the recent case of Mexichem UK Limited v Honeywell International Inc [2020] EWCA Civ 473 at [18] that "the extent of generality or particularity of the declaration may affect the utility of the declaration".

I am also troubled by what appears to me to be "boilerplate" drafting. One example is the reference to exclusion of liability in relation to " any system of law " without identifying what " system of law " or why such wording is necessary (or indeed appropriate for this English court to grant). Another is the reference to delict.

Another factor is that there is force in TRM's submission that it should not be left to third parties to try and interpret the wording of a declaration based on submissions. This also links to the concern expressed by Marcus Smith J in the Bank of New York Mellon case as to the potential for interference in foreign process. Here it is not a case of the evidence suggesting that the declaration will have an effect on foreign process. But there is a concern that to the extent that there is any lack of clarity which could result in the declaration as being seen to extend beyond the true logical consequences of the contractually based declarations, it has the capacity to do so. While it was submitted that the declaration is to clarify the earlier declarations, I struggle to see how (i) that is necessary or (ii) how the broader declaration achieves that.

Finally, when I look at the authorities I am not steered in another direction by any case where a declaration such as this has been made. BNPP relied heavily on the case of Verona. However, that was a case which was not contested and where the point was not therefore fully argued. Further in that case Teare J still granted narrower declarations than this declaration and declined to grant the wider declarations which might be seen as the parallel to the present declaration.

Accordingly while I have no difficulty in stating that as a matter of principle the clauses which give rise to the declarations I am granting would be expected to be given their full weight – and that may ultimately have a similar effect to the declaration sought - I am not prepared to make the declaration sought, even as "trimmed" by the Court of Appeal.'

[16] Cockerill J in BNP Paribas SA v Trattamento Rifiuti Metropolitani SpA [2020] EWHC 2436 (Comm) makes reference to a number of authorities:

(1) TQ Delta, LLC v ZyXEL Communications UK Limited, ZyXEL Communications A/S [2019] EWCA Civ 1277, paragraph 37. In that case and paragraph, Floyd LJ (with whom Lewison LJ agreed) in the Court of Appeal said:

'The court enjoys a broad, flexible jurisdiction to grant declaratory relief. As this court made clear in Messier Dowty Ltd v Sabena SA [2000] 1 W.L.R. 2040; [2001] 1 All E.R. 275 (in the context of negative declarations but, in my judgment applicable more generally) the jurisdiction is confined by the exercise of the court’s discretion rather than by jurisdictional thresholds. In Financial Services Authority v Rourke (t/a JE Rourke & Co) [2002] C.P. Rep. 14 (2001) Neuberger J correctly recognised that the first task for the court is to scrutinise the relief claimed and reject it where it would serve no useful purpose. Thereafter the court should consider whether the grant of the relief would serve the aims of justice, by which is meant justice to the claimant and justice to the defendant. If so, it should not be reluctant to grant the relief. Finally the court should ask whether there are any special reasons why the court should or should not grant the declaration.'

(2) Fujifilm Kyowa Kirin Biologics Co., Ltd. v Abb Vie Biotechnology Limited [2017] EWCA Civ 1; [2018] Bus LR 228, paragraph 60. In that case and paragraph, Floyd LJ (giving the judgment of the Court of Appeal) said:

'In Financial Services Authority v Rourke (trading as J E Rourke & Co) [2002] CP Rep 14, Neuberger J proposed the following, with which we respectfully agree:

“it seems to me that, when considering whether to grant a declaration or not, the court should take into account justice to the claimant, justice to the defendant, whether the declaration would serve a useful purpose whether there are any other special reasons why or why not the court should grant the declaration.”'

(3) Rolls Royce v Unite the Union [2010] 1 WLR 318, paragraph 120. In that case and paragraph, Aikens LJ said (prefacing with 'For the purposes of the present case'):

'...I think that the principles in the cases can be summarised as follows.

(1) The power of the court to grant declaratory relief is discretionary.

(2) There must, in general, be a real and present dispute between the parties before the court as to the existence or extent of a legal right between them. However, the claimant does not need to have a present cause of action against the defendant.

(3) Each party must, in general, be affected by the court's determination of the issues concerning the legal right in question.

(4) The fact that the claimant is not a party to the relevant contract in respect of which a declaration is sought is not fatal to an application for a declaration, provided that it is directly affected by the issue; (in this respect the cases have undoubtedly “moved on” from Meadows).

(5) The court will be prepared to give declaratory relief in respect of a “friendly action” or where there is an “academic question” if all parties so wish, even on “private law” issues. This may particularly be so if it is a “test case”, or it may affect a significant number of other cases, and it is in the public interest to decide the issue concerned.

(6) However, the court must be satisfied that all sides of the argument will be fully and properly put. It must therefore ensure that all those affected are either before it or will have their arguments put before the court.

(7) In all cases, assuming that the other tests are satisfied, the court must ask: is this the most effective way of resolving the issues raised? In answering that question it must consider the other options of resolving this issue.'

(4) R. (on the application of Al-Rawi) v Secretary of State for Foreign and Commonwealth Affairs [2008] QB 289, at 344. In that case, and on that page 344, there are a number of points made. While far from clear that the page reference is correct, as best that can be discerned, the relevant part is under the subheading 'Lesser forms of relief', wherein the Laws LJ (giving the judgment of the Court of Appeal) said:

'...the claimants seek a declaration (the fourth paragraph of the claim) that the detainee claimants will be entitled to immediate return to the United Kingdom in the event of their release from Guantanamo Bay. They also contend for a direction that the defendants inform the United States that the United Kingdom would be prepared to accept the detainee claimants back into this country, though there appears to be no formal pleading to that effect. We have already set out para 98 of the Divisional Court's judgment, which deals with the fourth head of relief. We agree with the reasoning there set out. We repeat for convenience one extract to which we would draw particular attention:

“The correspondence makes it plain that the second defendant has not been prepared to give an unequivocal commitment that they will be permitted to return to this country. It seems to us that that is the only proper stance he can take until such time as their release from detention becomes imminent. The decision will then be made on all the information available to him at that time.”'

Paragraph 98 of the Divisional Court's judgment said (Court of Appeal decision, 316):

'The claim is made because, certainly in relation to the second and third claimants, the travel documents with which they were issued when they left the United Kingdom only gave them a right to return to the United Kingdom if they did so within two years. Their detention in Guantanamo Bay has therefore taken them beyond the end of that period. The correspondence makes it plain that the second defendant has not been prepared to give an unequivocal commitment that they will be permitted to return to this country. It seems to us that that is the only proper stance he can take until such time as their release from detention becomes imminent. The decision will then be made on all the information available to him at that time. All that we can say at the moment is that a decision to refuse them entry based merely on the fact that they have been out of the country for more than two years would be difficult to justify.'