Since the early 19th century, extraterritorial anti-suit injunction has been granted in England to facilitate transnational commerce. Its principal aims are to enforce jurisdiction clauses, to mitigate inconvenience arising from concurrent proceedings in different jurisdictions and to prevent parties from reaping illegitimate advantages of forum-shopping.
This article proceeds in three parts. First, it alerts us to the trend that anti-suit injunctions are being granted more readily by both civil law and common law courts. Second, it explains the problems which flow from that trend. Lastly, it proposes two ways in which the current approach in granting anti-suit injunctions should be reformed.
The Alarming Trend
As well-established in English jurisprudence, the court grants an anti-suit injunction (A) where there is a breach of jurisdiction clause unless there are “strong reasons” not to do so (Donohue v Armco  1 Lloyd’s Rep 425, ), or (B) where foreign proceedings are “oppressive and vexatious” (Airbus Industrie  AC 119, 133C). In cases (A), English courts have tended to reject the argument that the foreign court’s applying principles different from English law amounted to “strong reasons”. Instead, they have applied their own conflict of laws rules and substantive principles in deciding issues such as whether a jurisdiction clause should be given effect (e.g. Akai Pty  1 Lloyd’s Rep 90, 98-100). In cases (B), English courts have defined “oppressive and vexatious” broadly to cover cases where foreign proceedings were brought in bad faith (Turner v Grovit  1 WLR 107, ), or where they led to oppressive consequences (e.g. pertaining to the costs and length of the proceedings) (Continental Bank v Aeakos Compania Naviera  1 Lloyds Rep 505, 512). More worryingly, English courts have appeared to adopt the same principles to grant anti-anti-suit injunctions, which directly conflict with foreign court orders and manifest judicial chauvinism. (Sabah Shipyard (Pakistan)  2 Lloyds Rep 571, -, -)
However, what is more alarming is that even civil law courts are getting more disposed to granting anti-suit injunctions and treating them less as an interference with foreign judicial process or a violation of comity. Recently, in July and November 2019, the Munich District Court and the Paris first instance court in two patent cases granted their first anti-anti-suit injunctions to order a party to refrain from bringing overseas anti-suit proceedings (Nokia v Daimler 21 O 8333/19; IPCom v Lenovo). This momentum has also been seen with the Wuhan Maritime Court of China , which issued an injunction to order a foreign ship-owner to withdraw its anti-suit proceedings in Hong Kong against a Chinese insurer (Huatai v Clipper Chartering  4 CMCLR 1).
As more anti-suit injunctions are granted, they may become counterproductive. For example, where there are competing anti-suit injunctions, both actions will be paralysed (provided that the parties do not act in breach of the injunctions) and neither party will be able to obtain reliefs. Moreover, where under this trend a party pursuing an anti-suit injunction is likely to be subject to an anti-anti-suit injunction and even an ancillary Mareva injunction (that is to say, a court order which enforces the damages order appended to an anti-suit injunction with the effect of preventing the assets of a party from being dissipated pending the completion of the case), it may simply refrain from seeking an injunction in the first place.
The problem, however, runs deeper than this. It brings about a dilemma for third-state courts which are wrangled in a jurisdiction dispute. Suffice it to illustrate it with a recent case before the Court of Final Appeal (CFA) in Hong Kong. In CSAV v Hin-Pro ( HKCFA 79), the plaintiff obtained an anti-suit injunction (together with damages order) from the English courts against the defendant who had commenced proceedings in China in breach of an exclusive jurisdiction clause (despite the Chinese court’s assumption of jurisdiction). Since the defendant’s asset was found to be in HK, the plaintiff then ran to the HK court to seek a Mareva injunction to enforce the aforesaid damages order. While the power of granting such injunction in aid of foreign proceedings was provided under HK law, it had never been applied to anti-suit proceedings. The CFA granted the injunction on a controversial basis. In gist, it adopted the English orthodox view that an anti-suit injunction in support of an exclusive jurisdiction clause does not infringe comity. It then concluded that since the English court had observed comity in granting the anti-suit injunction, the CFA would not infringe comity in enforcing the English court’s damages order either. However, this approach erroneously sidestepped the substantive effects of granting the Mareva injunction. In granting the injunction, the CFA had to rule on merits that the claimant had made out an arguable case for an anti-suit injunction before the English court. This forced the CFA to step into the shoes of the English court. Eventually, as the CFA agreed with the English court that the jurisdiction clause was enforceable (on which the Chinese court disagreed) and that the plaintiff has established a breach of the clause, the CFA has effectively rendered a decision in conflict with the Chinese court’s assumption of jurisdiction. Moreover, the English damages order, being in the form of compensating all losses suffered by the plaintiff incidental to the Chinese proceedings, effectively reversed any effects of the Chinese proceedings (and therefore conflicted with all the orders made by the Chinese court). By enforcing the damages order in Hong Kong, the CFA has sided with the English court to frustrate the Chinese court’s rulings. To the extent that Hong Kong was not a natural forum for the dispute and lacked sufficient interest in the matter, granting the Mareva injunction was clearly an unjustified intermeddling with the Anglo-Sino jurisdiction dispute in disregard of comity.
This case illustrated the conundrum faced by a third-state court with power to grant relief in aid of foreign anti-suit proceedings. Particularly, the difficult question is what law should be used by the Hong Kong court to evaluate whether the plaintiff has established an arguable case for the anti-suit injunction before the English court? Firstly, there was no justification in private international law that the Hong Kong court might apply the English but not the Chinese conflict of law rules simply on the basis that the English rules are more similar to the law in Hong Kong. If the Hong Kong court rationalised its application of the English rules on the ground that it applied lex fori to decide the issue, there would also be a problem. If the defendant to the dispute subsequently obtained an anti-suit injunction in China (which would be necessarily inconsistent with the English anti-suit orders) and sought a similar Mareva injunction before Hong Kong court, the court would have no choice but to reject the defendant’s application so as to avoid inconsistent judgments. Such a situation would undesirably encourage inappropriate “race to the court” litigation strategies.
Moreover, in similar circumstances, the judicial hostility will escalate if either party obtains an anti-suit injunction to restrain ancillary proceedings before the third-state court. Any application for ancillary remedies then entertained and granted by the third-state court will be in even greater tension with comity.
A More Comity-Friendly Approach
To avoid the aforesaid problems, the common law courts should adopt a more restrained attitude in granting anti (and anti-anti) -suit injunctions. This article proposes two ways.
First, in circumstances (A), the courts should treat a conflict between conflict of laws rules as “strong reasons” against the grant of an anti-suit injunction. As observed by the HK Court of Appeal in CSAV ( HKCA 107, ; a point not overruled by the CFA), international comity should allow both courts in a jurisdiction dispute to apply their respective conflict of laws rules. Millett LJ (as Lord Millett then was), in Refco v Eastern Trading ( 1 Lloyds’ Rep 159, 175) also noted that judicial comity requires mutual respect for both procedural and substantive laws. It is, therefore, submitted that a conflict between conflict of laws rules presents the circumstances where, in the words of Lord Mance, “the appropriate course will be to leave it to the foreign court to recognise and enforce the parties’ agreement on forum” (JSC v AES  UKSC 35, ).
Second, in circumstances (B), the courts should jettison the vague labels of “vexatious or oppressive” foreign proceedings. As aforementioned, those labels allow the courts to grant an injunction solely upon their view on the vexatious motives behind or the oppressive consequences of the foreign proceedings. However, such application of those labels seems inapposite where the foreign court is a natural forum, since in this case the courts should not be entitled to decide on those matters. In this regard, the Canadian two-step approach (which Lord Goff noted in Airbus, p139, as obiter dictum) has much to be commended: Injunction should be granted only where (a) the foreign court could not reasonably have concluded under the principle of forum non conveniens that there was no alternative forum that was clearly more appropriate and (b) the ends of justice so require. This approach aptly emphasises that comity requires a court not to arrogate itself the role of the sole arbiter of justice, unless it is clearly the more appropriate court to do so. Moreover, since the forum non conveniens principle (as opposed to the notion of “vexatious or oppressive”) is widely recognised by both common and civil law jurisdictions, this approach maximises the comity to be accorded to foreign courts. Finally, it does not undermine a court’s ability to protect its own jurisdiction or policy, because it can always deter “vexatious or oppressive” or otherwise unjust proceedings by refusing enforcement of the respective judgments.
To conclude, the case of CSAV v Hin-Pro has been a harbinger of problems flowing from the courts’ readiness in granting anti-suit injunctions. It is hoped that the English courts will reinstate the importance of comity in their approach to granting anti-suit injunctions. After all, it is beneficial to develop a more judicially harmonious legal regime, from which international corporations can predict the consequences of their actions with greater certainty.