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Hasty Filings and Lessons Learned: A Bermuda Case Study

The Bermuda Supreme Court decision in A K Bakri & Sons Ltd and ors v Asma Abdul Kader Bakri Al Bakri and anor [2017] SC (Bda) 40 Com serves as a stark reminder of the dangers of hastily issuing proceedings without due consideration.

The facts were unusual. In response to a letter before action, the plaintiffs issued proceedings in the Bermuda courts by way of a generally indorsed writ and took the further step of filing a statement of claim. Rather surprisingly however, they then sought to change tack and have the proceedings stayed indefinitely in favour of arbitral proceedings in Saudi Arabia. Counsel for the plaintiffs, with whom the court agreed, described commencing the Bermuda proceedings as a “blunder”.

In dismissing the application, Hellman J relied heavily on the dicta of Gloster J in Excalibur Ventures LLC v Texas Keystone [2012] 1 All ER (Comm) 933 QB that in order to stay proceedings commenced in one jurisdiction in favour of proceedings commenced by the same party in another jurisdiction, “special, rare or exceptional circumstances” justifying the stay needed to be established. As the plaintiffs failed to establish such circumstances, the option of granting a stay was not available. To add insult to injury, Hellman J conceded that had the Bermuda proceedings not been commenced, then Saudi Arabia would likely have been the correct forum.  

The case illustrates the difficulties plaintiffs will face when seeking to change jurisdiction once they have proceeded down a certain jurisdictional path. The requirement of special, rare or exceptional circumstances is a difficult threshold to surpass. Counsel and litigants are thus well advised to think carefully to ensure they are proceeding in the correct (or their preferred) jurisdiction before taking action.

 

Case study

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