Move closer

The opening of the Rolls Building could lead to closer cooperation between court divisions, predicts Bridget Lucas

For commercial and chancery lawyers, it may be the legacy from the events of 2011 that is of more interest than any ­anticipated legacy that might be expected from the Olympics in 2012. From 1 October 2011 the Chancery Division, Commercial Court and Construction Court will become neighbours in the new Rolls Building, off Fetter Lane.

The English courts are no strangers to entertaining highly complex, international disputes, but perhaps had lost their claim to be the go-to dispute resolution centre. ­Certainly, the court facilities previously available ranged from shabby to chic, and a glitzy new building, with 31 courtrooms, including three ’super courts’, and 51 ­consultation suites available, cannot harm the Government’s aim of creating the biggest dedicated business court in the world. But is the cohabitation of the Rolls Building but one step towards a more ­permanent marriage between the Chancery and Commercial Courts?

For many years the soubriquet ­’commercial/chancery’ has become ­increasingly ­popular, in particular on the part of chancery sets keen to denote areas of their work as distinct from those more ­traditionally associated with the term ’chancery’. There is an inescapable overlap in the work undertaken by commercial
and chancery sets when it comes to ­international business disputes.

This is obviously so in the complex ­international frauds, but the overlap is also present in credit-crunch litigation (where insolvency and banking lawyers meet) and in the sophisticated joint venture arrangements and shareholder deals that are now prevalent in international business arrangements, some of which inevitably come to grief.

The English courts have frequently had to grapple with commercial disputes that give rise to related proceedings in courts around the globe. But similar issues will also arise between the divisions cohabiting under their own, brand-new, roof.

In Berezovsky v Abramovich (2010), ­setting aside past territorialism and in the true spirit of proactive interdivisional case management, Mr Justice Mann and Mrs Justice Gloster held a joint case ­management conference relating to ’the Abramovich Action’ proceeding in the ­Commercial Court and three actions ­proceeding in the Chancery Division.

While the claimant was the same in each instance, and some of the defendants were defendants to all of the actions, one ­defendant was a defendant only in the Abramovich Action, and other defendants were only defendants to one or more of the Chancery actions. While there were areas of significant overlap between some or all of the actions, in other respects the actions were quite separate.

As the court observed, the possible ways of catering for such a situation ranged from, at one extreme, a trial of them all together to, at the other, letting each set of proceedings take its own course. If the former course was adopted the result would probably not even be sensibly triable, although as the judges observed, in purist terms it would be the only way of avoiding the possibility of conflicting decisions.

Having dismissed the option of complete joinder the judges considered whether to do nothing, or whether to adopt a middle course that entailed at least some of the areas being tried once, but only in one set of proceedings and not both. They were inclined to adopt this course if at all possible, not least because “it is a waste of court resources, and is not conducive to the ­reputation of the courts and the due ­administration of justice to have issues tried twice unnecessarily”.

Given the complexity of the litigation, there was no “plain and obviously right ­solution” but only a range of potential ­solutions each of which had its drawbacks. In the end, one category of issues was ­considered “sufficiently discrete, ­sufficiently important and sufficiently common to make it proper to try them once, in the Abramovich Action, with the defendants in the [Chancery actions] having the ­opportunity to participate in that action for that purpose and so as to bind all parties by findings made in ­relation to it”.

Of course, all sorts of possibilities arose as to the potential impact on the Chancery actions and in particular on the timetable should there be an appeal on the particular issue in question, or indeed any other issue that might delay the determination of the Commercial Court action. However, none of these concerns was considered ­insurmountable. It was ordered that the common issues identified be taken as a ­preliminary issue in the Chancery actions, and tried with the Abramovich Action which would be tried first, and heard by Gloster J.

With such proactive case management giving practical effect to the obvious overlap in the disputes loosely encompassed within the ’commercial/chancery’ brand, it is not only in terms of physical proximity that the Chancery division and Commercial Court are moving closer together. A marriage to cement such a good match makes sound business sense.

Bridget Lucas is a barrister at Fountain Court Chambers