COUNSEL:  Leonard Hoffmann QC and D T Donaldson for BT.

Nicholas Strauss for Mr Karoon.

The second respondent was not represented.

 

SOLICITORS:  Herbert Smith & Co (for BT); Baker & McKenzie (for the respondents).

 

JUDGES:  ACKNER AND ROBERT GOFF LJJ

 

DATES:  3, 4, 5 APRIL, 24 MAY 1984

 

24 May 1984.

 

ACKNER LJ.

 

The respondent, Mr Karoon, is neither a national of nor resident in this country. He is an Iranian citizen who left Iran at the time of the revolution in November 1979 and is now living in France. The Bank of Tokyo Trust Co (BTTC) is a New York corporation which is a wholly-owned subsidiary of the Bank of Tokyo Ltd (BT), the appellents, a Japanese bank carrying on business in London.  [471] 

 

On 7 November 1983 Bingham J refused to grant an injunction restraining Mr Karoon from taking any further steps in an action that he had begun in New York against BTTC, or commencing or prosecuting any other proceedings relating to the same subject matter before any other court than the English High Court. It is against this refusal that BT now appeals. He did however order that Mr Karoon be restrained from continuing the proceedings against BT, who had been joined as co-defendants with BTTC. Against this decision there is no cross-appeal.

 

The circumstances out of which his claim in the New York action arose can be shortly stated. Although Mr Karoon and his wife and children were able to leave Iran, the rest of Mr Karoon’s  family and his wife’s  family are still in Iran and he has fears for their safety. From 1961 onwards he was the chief operating officer of an Iranian company called Maritime Co Ltd (Maritime) in which he owned nearly all the shares. Maritime carried on a shipping business. For some years prior to his departure from Iran he maintained a personal bank account with BTTC. He also maintained both a personal and a company account with BT. Following his departure from Iran, Mr Karoon transferred approximately $685,000 from his personal account with BTTC to his personal account with BT. He also instructed BT to transfer all moneys from the company account to his personal account.

 

In February 1980 BT received a letter from Maritime in Iran to advise them that on 3 February 1980 Mr Karoon had been sentenced in absentia to ten years’ imprisonment and that his and the company’s  property had been taken over by the government of Iran. BT was asked to transfer all balances to Iran. BT responded to the effect that all the company’s  accounts had been closed prior to their receipt of this letter, on the instructions of the account’s  sole signatory (Mr Karoon), and that under English law it would be a breach of confidence to make any disclosure regarding a customer’s  personal affairs without his prior authorisation. They also advised Mr Karoon of their receipt of this letter and their response. He thereupon instructed them to transfer funds they were holding to an account which he maintained with another bank. BT was concerned with its position. If it did not carry out his instructions it might be liable to him. On the other hand, if it did carry out his instructions it might be liable to those now in charge of Maritime. Accordingly, on 21 March 1980 BT issued an interpleader summons to determine whether the money which it held was payable to Mr Karoon or to Maritime.

 

On 15 April 1980 Mr Karoon issued a summons to strike out the interpleader proceedings under RSC Ord 18, r 19. In his affidavit he swore, inter alia, that “On 3 December 1979 I remitted $US685,800 of my own money from my account at the bank’s  branch in New York to the bank … These moneys had not originated from the company”.

 

He explained how they were placed on deposit and that on 27 December 1979 there was due to him $US689,421.88. He contended that Maritime could have no arguable claim to these moneys, even if proceedings were appropriate in respect of the English funds. He also expressed concern that, if the Iranian government knew about the funds in London, his relations would be used as a lever to force him to remit the money to Iran.

 

In reply to this affidavit Mr Saunders, an officer of BT, swore another affidavit in which he said:

 

“1. Inquiries have been made of The Bank of Tokyo Trust Company, New York in respect of a remittance in the sum of U.S. Dollars 685,800 credited to the First Defendant’s  External Savings Account Number 61817–3 on 5th December 1979 in order to establish the source of the said money.

 

2. I am informed and verily believe that the said sum was made up from two fixed deposits ((a) and (b) respectively) which were automatically renewable every three months and which had been pre-matured and credited to the First Defendant’s  New York checking account (Number 121–004–775) in order to cover the said payment. Fixed deposit (a) was valued at U.S. Dollars 183,797.83 and (b) at U.S. Dollars 497,803.98.

 

3. Fixed Deposit (a) was opened on 14th December 1978 with a transfer of U.S.  [*472]  Dollars 170,000 from a savings account maintained by the First Defendant, which account was opened on 5th April 1976 with initial funds of U.S. Dollars 425,000 by means of a transfer from the First Defendant’s  Checking Account Number 121–004–775. I am informed that the sum of U.S. Dollars 511,000 had been credited to the said checking account on 30th December 1975 by order of Fairfield International Limited of 227 Park Avenue New York. Prior to 14th December 1978, the said savings account had been credited with U.S. Dollars 115,200, being the proceeds of a cheque drawn on Midland Marine Bank, New York by order of Mowbrays Tug and Barge Sales Corporation.

 

4. Fixed Deposit (b) was opened on 23rd April 1979 with a transfer of U.S. Dollars 473,000 from the said savings account maintained by the First Defendant. The account had been credited on 11th April with the proceeds of a cheque for U.S. Dollars 32,569.75 drawn on Wells Fargo Bank New York by order of Utah House Fire Insurance Company and on 23rd April with the proceeds of a cheque for U.S. Dollars 441,992.01 drawn on Chase Manhattan Bank by order of Adams and Porter Incorporated.”

 

The affidavit was never served on Maritime, who were at that time not party to the proceedings to strike out. The application, which was heard by Robert Goff J, failed. A note of his judgment was before Bingham J, and the relevant part to the proceedings before him was quoted by the judge as follows:

 

“There were certain accounts in the name of Majid Karoon and certain accounts in the name of Maritime Co. Certain moneys were transferred from New York which Majid Karoon says are his. There has been an amalgamation of accounts carried out in accordance with instructions given on 24 December 1979 and 20 February 1980 … Finally I am asked to look at the evidence to find that a substantial part of the moneys must belong to Majid Karoon. I am invited to look at the letter and to find that it makes no claim on Majid Karoon’s  assets. The difficulty is that I am faced with one party’s  evidence. The bank is in the middle and can only act fairly, which it cannot do not knowing the full facts. It would be quite wrong for me to pre-empt the situation on one party’s  evidence, especially having regard to the history which shows that Majid Karoon has not sought to keep his own and Maritime’s  moneys separate. No accurate assumptions on a split can be made. It seems to me that the workers council letter is written in such English as the bank has reasonable grounds to assume that a claim may be pressed not only against Maritime’s  accounts but also against Majid Karoon’s  accounts in so far as the money is in origin Maritime’s  money which he has transferred into his own account. He may have acted in breach of his obligations to the company. In my judgment there are reasonable grounds that the bank may be sued for not only Maritime’s  money but also that money held by Majid Karoon. The bank was fully entitled to interplead. I cannot accede to the application. To interplead was a natural reflex of the bank.”

 

On 4 March 1983 an interpleader issue was eventually ordered. The order was by consent, no attempt being made to limit the order to the English as opposed to the American moneys. It reads as follows:

 

“1. The Plaintiffs [BT] be forthwith discharged from any liability to either of the Defendants in respect of any monies the subject matter of these proceedings and that no action be brought in respect thereof against the Plaintiffs by either of the Defendants, including an action by the First Defendants acting in the name of the Second Defendants.

 

2. The Plaintiffs do pay the monies the subject matter of these proceedings after deduction of their usual banking charges into Court as and when each of the current Special Deposits matures and that the monies presently held on call be paid together with the first Special Deposit money on maturity thereof and that meanwhile the Plaintiffs hold the said monies to the direction of the Court.”  [*473] 

 

The complaint in the New York proceedings is based on BTTC’s  voluntary disclosure to BT of information relating to his account in New York. This disclosure is alleged to have been a breach of its contractual duty of confidence to Mr Karoon, to have violated Mr Karoon’s  “right of privacy”, and made in conspiracy with BT to injure Mr Karoon. A total of $4m damages is claimed, $1m as punitive damages for the breach of the “right of privacy” and the conspiracy, additional to the $1m claimed for “special damage” for each of the three causes of action.

 

Before Bingham J counsel for BT submitted that the New York proceedings would cause injustice to his clients for a number of reasons, which the judge summarised under five headings. The first two can be taken together, it being submitted: whatever the prospects of success, the New York action is an attempt to penalise BT for availing itself of the interpleader procedure in England and complying with the Rules of the Supreme Court; the New York action would involve relitigating a matter already litigated in England, ie whether an interpleader should have been ordered in respect of moneys remitted from the United States; as such, the action is vexatious and oppressive. It is in truth doubly vexatious and oppressive because it has no reasonable prospect of success, since Mr Karoon will be quite unable to show that he has suffered any damage, because Robert Goff J would have made the selfsame order if BT had not relied on the information provided to it by BTTC.

 

The three further points of counsel for BT submitted to the judge can again be stated as one proposition, namely that an English court is the forum conveniens because it can without difficulty resolve what duty of confidence, if any, was owed by the New York bank in these circumstances to its client Mr Karoon. Tournier v National Provincial and Union Bank of England [1924] 1 KB 461, [1923] All ER Rep 550 is the source of the law in both jurisdictions. By contrast, a New York judge would be faced with difficult questions concerning the duty of an English litigant in an English interpleader. Moreover, if Mr Karoon were able to establish that he would have succeeded in striking out the interpleader proceedings had not BTTC provided the information to BT, he would still have to establish, in order to claim damages, that the money in London belonged to him and that issue has to be decided in London. Mr Karoon, moreover, has no legitimate juridicial advantages in proceedings in New York.

 

Before Bingham J no submission appears to have been made to the judge that a different approach might be justified to the New York action, according to whether one was considering the position of BTTC or the position of BT. Neither party asked the judge to differentiate between BT and BTTC in any order he made. However, in his judgment, viewing the two companies as two separate legal entities, Bingham J concluded that they should be treated separately. In regard to the New York action, in so far as it related to BTTC, he said:

 

“It is an action brought in New York against a bank incorporated and carrying on business there. Mr Karoon, an Iranian citizen resident in France, had an account with that bank. Although Mr Karoon has advanced three causes of action against BTTC (breach of confidence, invasion of privacy and conspiracy) it seems plain that his central complaint against BTTC arises from its voluntary disclosure to BT of information relating to his account. Whether this disclosure involved a breach of contractual duty, or of Mr Karoon’s  right to privacy, on the part of BTTC must be determined according to the law of New York. Whether BTTC was guilty of an actionable conspiracy may also fall to be decided under that law, although this cause of action appears to be something of a makeweight. The disclosure by BT to the English court forms no part of Mr Karoon’s  cause of action against BTTC. That disclosure does have a significant bearing on Mr Karoon’s  ability to prove actual damage flowing from the disclosure, since he could show none if Robert Goff J would have made the same order even without the information concerning Mr Karoon’s  American transactions in Mr Saunders’s  affidavit. To that extent the action does involve inquiry into what Robert Goff J would have done on different evidence,  [*474]  an inquiry which would be best carried out by this court. It is, however, an inquiry which a New York court could doubtless undertake and resolve. Mr Karoon may have a cause of action for invasion of privacy available to him in New York which is not available here. It would certainly appear that his chances of obtaining substantial damages on a punitive or exemplary basis are better there. His ability to sue in New York on a contingency fee basis may not be a juridical advantage (see Smith Kline & French Laboratories Ltd v Bloch [1983] 2 All ER 72 at 86, [1983] 1 WLR 730 at 747) and is, in my view, counterbalanced by BTTC’s  inability to recover costs if successful, but is certainly not an argument against allowing the New York action to proceed against BTTC. Overall, I do not regard an injunction as appropriate to restrain the action in so far as it lies against BTTC. If the action were to proceed, BTTC might, of course, win or lose; and if it lost the damages might be large, or nominal, or even non-existent. But all these seem to me to be matters best entertained and resolved in the New York court which would be applying its own law to events very largely occurring within its own jurisdiction.”

 

In reaching his decision relative to BTTC, Bingham J was applying the principles to which he made specific reference, as laid down or reflected in the decisions of The Atlantic Star, Atlantic Star (owners) v Bona Spes (owners) [1973] 2 All ER 175, [1974] AC 436, MacShannon v Rockware Glass Ltd [1978] 1 All ER 625, [1978] AC 795, Castanho v Brown & Root (UK) Ltd [1981] 1 All ER 143, [1981] AC 557 and Trendtex Trading Corp v Cr�dit Suisse [1980] 3 All ER 721, [1980] QB 629. These principles were not in dispute between the parties.

 

He then turned his attention to the New York action against BT, commenting that the claim assumed a somewhat different aspect. He said:

 

“The crux of Mr Karoon’s  complaint against BT is that it acted unlawfully in seeking information from BTTC. The allegation is made that BT gratuitously revealed this information, but counsel for Mr Karoon accepted that the revelation was not gratuitous and acknowledged the difficulty of maintaining that BT had no interest in revealing that information. BT is also accused of conspiracy and inducement of breach of contract by BTTC, but these complaints arise out of the same factual premise, namely the request for information made by BT to BTTC. This was a request made by BT in the context of its role as a party seeking to interplead under RSC Ord 17. In his original affidavit, Mr Saunders had made no overt reference to these moneys transferred by BTTC to BT. Mr Karoon raised a clear issue concerning them in his affidavit of 25 April. BT had either to let the matter (and the moneys) go, with the risk that it might later be held accountable for the moneys, or make such enquiries as it could (or, if it had already made inquiry, inform the court of the result). Leaving entirely on one side the question whether, on information being requested, BTTC should, as a matter of New York law, have complied with the request, I think that two significant questions of English law arise in respect of BT’s  conduct: whether it was reasonable and proper for BT, in seeking to protect its own interests, to request information from BTTC; and whether, in pursuance of its duty as a party applying to interplead it was proper for BT to seek to lay before the court all evidence within its power relevant to the application. This is a lis between a bank carrying on business in London and a London customer of that bank arising out of English interpleader proceedings to which both were party. Moreover, it directly touches on a matter with which this court must be very closely concerned, the proper conduct of a party to English interpleader proceedings. I should not and do not form or express any opinion whether BT’s  conduct was proper or improper. That is not an issue before me. I am, however, of the opinion that BT would be exposed to the risk of real injustice if the propriety of its conduct were to be judged in any court other than that in which the interpleader proceedings took place. It furthermore appears to me that England is in every way a more appropriate forum than New York for trial of the issues  [*475]  between Mr Karoon and BT and that Mr Karoon would lose no legitimate juridical or personal advantage by suing here. The New York forum would afford him no additional cause of action and the chance of an improved measure of damage would be problematical. These considerations are, however, in my judgment, of less weight in this than in the usual case because the overriding consideration of what justice demands points strongly towards restraint of Mr Karoon’s  action against BT in New York. If BT were the only New York defendant, I would, even bearing in mind the need for great caution in restraining prosecution of a foreign action, think it right to grant an injunction.”

 

The difficulty which then faced Bingham J was the combination in one set of New York proceedings of claims against BTTC, which he was not willing to restrain, and claims against BT, which he was. He concluded that it would not be right to grant an excessive injunction, which would be the case if he restrained the prosecution of an action which he regarded as properly brought against BTTC in New York, nor would it be right to expose BT to an unacceptable risk of injustice. He therefore made no mandatory order that Mr Karoon discontinue his New York proceedings, but he continued the negative injunction made ex parte on 13 September 1983, restraining Mr Karoon from taking any further steps in the New York action so far as it related to BT. Mr Karoon thus remained free to prosecute the New York action against BTTC. Counsel on behalf of Mr Karoon is content with that position because BT is not a necessary party to the New York action. Mr Karoon can obtain all the remedies to which he is entitled with the New York action limited to BTTC.

 

Before us counsel for BT has stressed the distinction between his two lines of argument, and reinforced the distinction by reference to the recent decision of the United States Court of Appeal for the District of Columbia Circuit in Laker Airways Ltd v Sabena Airlines and KLM Airlines (1984) 731 F 2d 909. His first line of argument is that, as a matter of English public policy, the claims in New York should not be allowed to be brought at all. Citing the American Laker case (at 929) per Judge Wilkey:

 

“Courts have a duty to protect their legitimately conferred jurisdiction to the extent necessary to provide full justice to litigants … the court may freely protect the integrity of its judgments by preventing their evasion through vexatious or oppressive relitigation”

 

he maintained: (1) that there is “an overriding public policy” that a litigant should be able to take all proper steps to put relevant evidence before the court; (2) that it is in the public interest that there should be finality in litigation, and, since Mr Karoon had not objected to Mr Saunders’s  affidavit being put before Robert Goff J, he should not now be allowed to bring an action for damages allegedly arising from the use of that affidavit.

 

As regards the latter point, counsel for BT expressly accepted that any objection by Mr Karoon would have been doomed to failure and in such circumstances it seems to me plain that Mr Karoon cannot be blamed for having failed to take what is accepted would have been futile action.

 

Thus, counsel for BT’s  first and main criticism of Bingham J’s  decision is that he treated the case as being an ordinary case of competition between two jurisdictions where the question was which was the most appropriate forum.

 

It is however quite fundamental to counsel’s  submission (and he readily accepts this) that the public policy on which he relied requires the court to overlook the corporate distinctions in law between BT and BTTC. While accepting that BT and BTTC are separate legal entities, counsel contends that from a practical point of view it makes no difference whether BTTC was a branch of BT or a subsidiary. He argues that if one looks at the substance of the matter, BT are being sued in New York on account of the evidence which they gave in their own defence in proceedings brought against them by Mr Karoon in London. The protection of BT’s  own interests required the giving of this information and accordingly BT, which must in practice be treated as having this  [*476]  information in their possession, was not in breach of its implied obligation of secrecy (see Tournier v National Provincial and Union Bank [1924] 1 KB 461, [1923] All ER Rep 550).

 

The reality of the matter is that BTTC is not a branch of BT. That is not the way in which BT has chosen to organise its business as a bank. Of course, BT is entitled to take all proper steps to obtain evidence to resist Mr Karoon’s  application to strike out the interpleader summons, but the issue remains, were these steps proper ones? If, as Mr Karoon maintains, BTTC owed him a duty of confidence and was therefore not entitled to communicate to another separate legal entity any information concerning his account with them without his approval, then BTTC was in breach of its duty and it would follow that BT induced a breach of contract. Counsel for BT accepted that if BTTC was not a subsidiary of BT but was another bank, then Mr Karoon would certainly have a cause of action, although he maintained his contention that his damages would be purely nominal.

 

I can see no valid basis, and certainly no authority was provided to us by counsel for BT, for the contention that we must ignore the separate legal existence of BTTC. Once the corporate distinction in law between BT and BTTC has to be recognised, the foundation of counsel’s  submission that there is an English rule of public policy which requires that this action should not be allowed to be brought disappears. There is an arguable case that BTTC, a separate juridical entity, owing Mr Karoon an obligation of secrecy, broke that obligation when, without his consent, they revealed to BT the material referred to above concerning his account in New York.

 

In his reply, counsel for BT formulated a further issue of public policy, namely that damages cannot be recovered, other than nominal damages for breach of contract, as a result of there being introduced into litigation in England relevant and admissible evidence, even though such evidence has been improperly obtained. He submitted that as a matter of public policy it is so essential to the administration of justice that all relevant and admissible evidence is placed before the courts that, even though such evidence may have been provided in breach of a contract not to divulge such material and damage can be established to have resulted from this wrongful disclosure, the plaintiffs’ remedy is limited to nominal damages for breach of contract, and he has no remedy against the person who wrongfully induced the breach of contract.

 

Counsel for BT was at pains to make quite clear that he was not limiting this rule of public policy to the case of a plaintiff who had wrongfully concealed evidence or sought to mislead the court, and had ultimately failed in his claim because evidence improperly obtained had ultimately been put before the court. That would merely be an example of the well-established principle, ex turpi causa non oritur actio. Counsel for BT was unable to produce any authority in support of the existence of this rule of public policy and it became apparent in the course of his submissions that it would not be difficult to imagine examples where such a rule would operate contrary to accepted notions of justice and fairness. Moreover, it is of the very essence of our adversarial system that the court decides the dispute on the material placed before the court, it being for the parties and not for the court to decide of what that material should consist. Hence the well-established principle that in civil litigation the judge is not entitled, without the consent of the parties, to call a witness, although he may have every reason to believe that such a witness might well enable him the better to reach a just decision (see Enoch v Zaretzky Bock & Co [1910] 1 KB 327 and Fallon v Calvert [1960] 1 All ER 281, [1960] 2 QB 201).

 

I am therefore far from satisfied that such a wide principle of public policy exists. But, even were it to exist, it would not justify the striking out of the action. Ex hypothesi, the plaintiff would have a good cause of action for breach of contract, and the fact that his damages might well be nominal still entitles him to bring his action. He might well be content with a declaration which established that the defendant broke some important duty of secrecy and was therefore not to be trusted. Accordingly, this rule of English public policy, were it to exist, cannot support the contention of counsel for BT that the action against BTTC should never have been brought and therefore that the proceedings should be stopped in limine. It would merely preclude the right to recover more than nominal damages.  [*477]  T

 

The action brought by Mr Karoon against BTTC is in every sense an American action. The contract on which the contractual claim is based was made in New York with a New York corporation. The proper law of that contract is American law and if according to American law a breach of that contract took place when BTTC divulged information to BTTC, then the breach of that contract took place in New York. So far as the tort of conspiracy is concerned, the alleged conspirator who is being sued is a New York corporation, and for an alleged conspiracy that took place in New York because it was there that both the agreement and the overt acts in pursuance of that conspiracy were made and carried out. It will be for American law to determine whether the tort of conspiracy was committed and for this decision the New York court is the natural forum (see Distillers Co (Biochemicals) Ltd v Thompson [1971] 1 All ER 694, [1971] AC 459). Further, the alleged invasion of privacy occurred in New York. It is a cause of action as yet unknown to English law and will have to be determined in accordance with New York law. In the result New York law will be the proper law for the determination of whether or not there has been a breach of contract and whether or not BTTC has committed the two torts alleged. New York law will also be the lex fori. In such circumstances it seems to me to be irrelevant that in England, assuming the submission of counsel for BT to be correct, Mr Karoon would have recovered only nominal damages for breach of contract.

 

As regards the second line of attack of counsel for BT, he ultimately conceded that, if the corporate distinctions in law must not be overlooked and BTTC must be treated as a separate legal entity (as is indeed my view), then New York is the natural forum for the reasons to which I have recently referred. In such circumstances there is no need to consider the balance of legitimate juridical advantages. However, were we obliged to consider that matter, I do not think that counsel would have seriously contended that the balance was other than in favour of the action remaining in New York. Mr Karoon alleges on affidavit that as a result of BT successfully interpleading he has no funds to support his litigation. However, in America he can bring his claim because of the contingency fee system. Smith Kline & French Laboratories Ltd v Bloch [1983] 2 All ER 72, [1983] 1 WLR 730 was a decision on its own very special facts, where the Court of Appeal was clearly of the view that the plaintiff, who had legal aid in England, was abusing the contingency fee system in order to bring proceedings in America against the American parent corporation, against which he had no real cause of action. His cause of action, if any, lay against the English subsidiary and his conduct in bringing the American proceedings was clearly vexatious. Thus, in that case it was not a legitimate judicial advantage. Moreover, were Mr Karoon to bring proceedings in England, he would inevitably be met with a claim for security of costs, being resident out of the jurisdiction, and this he could not, or would have great difficulty in meeting. He is of course faced with no such problems in the United States. It is common ground that under New York law he may well have a claim for exemplary damages. Although this is certainly not accepted by BT, Mr Karoon might, under New York law, be able to recover exemplary damages, even though he only obtained nominal damages for the alleged breach of contract and/or no actual damage for the torts of invasion of privacy or conspiracy.

 

In the end there is left only one unusual feature which will face the New York court. It will have to decide whether the provision by BTTC to BT of the information which BT subsequently put before the court in fact resulted in Mr Karoon losing any real chance of either striking out the interpleader summons or obtaining summary relief under Ord 17, r 5, in short, what probably would have happened in England if BTTC had not made the information available to BT. Although this is an unusual inquiry for a New York court to make, it will, if and when required, be provided with expert evidence as to English law and procedure and should ultimately have no difficulty in resolving this issue.

 

I would accordingly dismiss this appeal.

 

ROBERT GOFF LJ.

 

Bingham J was faced with the following situation. The Bank of Tokyo Ltd, the appellant before this court (which I shall refer to as “BT”), had commenced interpleader proceedings in this country. It had done so because there were moneys  [*478] credited to accounts at its London branch to which competing claims were being made, on the one hand, by an Iranian company, Maritime Co Ltd (Maritime), through a workers’ council in Iran which, following the revolution in that country, appeared to have gained control of Maritime; and, on the other hand, by an Iranian gentleman, Mr Karoon, the respondent before this court, who formerly controlled Maritime but who has, since the revolution in Iran, left that country and taken up residence in France. The interpleader proceedings have been complicated by the fact that Mr Karoon, fearing that disclosure to Maritime of the existence of certain of these moneys might have an adverse effect on his family in Iran, sought to persuade the English court that no such disclosure should be allowed. That attempt has in fact failed, because disclosure was necessary to enable the interpleader issue to be tried. However, one of the steps which Mr Karoon at one time took was to ask the English court to strike out the interpleader proceedings under RSC Ord 18, r 19, his submission being that certain moneys which had been transferred to BT’s  London branch from Mr Karoon’s  personal account with the Bank of Tokyo Trust Co, the New York subsidiary of BT (which I shall refer to as “BTTC”), were his own and were moreover moneys to which Maritime could have no arguable claim, so that they should not be the subject of the interpleader proceedings.

 

The commercial judge (who, it so happens, was myself) dismissed that application. A note of the judgment is before this court and shows that the basis of the decision was that the court considered that, having regard in particular to a letter emanating from the workers’ council, BT had reasonable grounds for thinking that it might be sued by Maritime not only in respect of moneys of Maritime but also in respect of moneys of Mr Karoon on the ground that they had emanated from Maritime, and that it would be wrong for the court to pre-empt the situation on the evidence of one party only. At all events, for the purposes of his application to strike out, Mr Karoon swore an affidavit concerning the moneys which had been transferred from BTTC, stating that those moneys had not originated from Maritime. As a result, BT made inquiries of BTTC about those moneys. BTTC then supplied information about the moneys to BT, some of which was embodied in an affidavit sworn by Mr Saunders of BT for the purpose of laying the information before the commercial judge when he dealt with Mr Karoon’s  application to strike out.

 

Mr Karoon has taken objection to his bankers in New York, BTTC, supplying this information to BT, and indeed he has objected to BT seeking to obtain the information from BTTC. So, on 7 July 1983, he commenced proceedings in New York against both BT and BTTC. In those proceedings he alleged (1) breach by BTTC of its contractual duty of confidence to him, in revealing the information to BT, (2) breach of contract by BT in obtaining the information, (3) violation by BTTC of Mr Karoon’s  right of privacy, (4) conspiracy by BT and BTTC and (5) that BT wrongfully induced BTTC to break its contract with Mr Karoon.

 

On its application before Bingham J, BT asked for an order directing Mr Karoon to discontinue the action in New York against BT and BTTC and/or an injunction restraining Mr Karoon from taking any further steps in the New York action or “commencing or pursuing any other proceedings relating to the same subject matter before any other court than this Honourable Court”. The judge declined to make a mandatory order, but he maintained an injunction (which had earlier been granted ex parte) in terms expressly limited to the New York proceedings against BT. The effect was that Mr Karoon was free to prosecute his New York action against BTTC, but not against BT.

 

The reasoning of Bingham J was as follows. Having set out the applicable principles, he first considered the New York action against BTTC. He then concluded:

 

“Overall, I do not regard an injunction as appropriate to restrain the action insofar as it lies against BTTC. If the action were to proceed, BTTC might, of course, win or lose; and if it lost the damages might be large or nominal, or even non-existent. But all these seem to me to be matters best entertained and resolved in the New York court which would be applying its own law to events very largely occurring within its own jurisdiction.”  [*479] 

 

However, when the judge turned to the New York action as against BT, the case appeared to him to assume a somewhat different aspect. He drew attention to the fact that BT’s  request to BTTC was made by it in the context of its role as a party seeking to interplead in the English court, following Mr Karoon’s  reference to the moneys in his own affidavit. He continued:

 

“Leaving entirely on one side the question whether, on information being requested, BTTC should, as a matter of New York law, have complied with the request, I think that two significant questions of English law arise in respect of BT’s  conduct: whether it was reasonable and proper for BT, in seeking to protect its own interests, to request information from BTTC; and whether, in pursuance of its duty as a party applying to interplead, it was proper for BT to seek to lay before the court all evidence within its power relevant to the application. This is a lis between a bank carrying on business in London and a London customer of that bank arising out of English interpleader proceedings to which both were party. Moreover, it directly touches on a matter with which this court must be very closely concerned, the proper conduct of a party to English interpleader proceedings. I should not and do not form or express any opinion whether BT’s  conduct was proper or improper. That is not an issue before me. I am, however, of the opinion that BT would be exposed to the risk of real injustice if the propriety of its conduct were to be judged in any court other than that in which the interpleader proceedings took place. It furthermore appears to me that England is in every way a more appropriate forum than New York for trial of the issues between Mr Karoon and BT and that Mr Karoon would lose no legitimate juridical or personal advantage by suing here. The New York forum would afford him no additional cause of action and the chance of an improved measure of damage would be problematical. These considerations are, however, in my judgment, of less weight in this than in the usual case because the overriding consideration of what justice demands points strongly towards restraint of Mr Karoon’s  action against BT in New York. If BT were the only New York defendant, I would, even bearing in mind the need for great caution in restraining prosecution of a foreign action, think it right to grant an injunction.”

 

BT has appealed to this court against the judge’s  decision, in so far as he failed to restrain Mr Karoon from pursuing the New York action as against BTTC. There is no cross-appeal by Mr Karoon. This is for the simple practical reason that Mr Karoon’s  New York action can continue just as well against BTTC alone. However, in so far as it may be necessary for the purposes of resisting BT’s  appeal, Mr Karoon has by his respondent’s  notice taken the point that the judge was wrong to continue the injunction restraining Mr Karoon from further prosecuting the New York action against BT.

 

Before the judge, counsel for BT had argued that the New York proceeedings would cause injustice to his clients for a number of reasons, viz: (1) the New York action was vexatious because (a) it was an attempt to penalise BT for availing itself of the interpleader proceedings in England, (b) it would involve relitigating the question (already litigated here) whether an interpleader issue should have been ordered and (c) it had no reasonable prospect of success; and (2) any action should be tried in England because (a) the interpleader proceedings were already here, (b) an English court could, without difficulty, resolve what duty of confidence is owed by a New York bank to its client, whereas a New York judge would be faced with difficult questions regarding English interpleader proceedings, (c) the question of ownership of the moneys had to be decided first anyway and (d) the availability of a contingency fee to Mr Karoon could not, on the authorities, be regarded as a juridical advantage to him. Before this court, however, Mr Hoffmann’s  argument was somewhat different. The reason for the development of his argument was the intervening decision of the US Court of Appeals in Laker Airways Ltd v Sabena Airlines and KLM Airlines 731 F 2d 909, which was only decided on 6 March 1984 and so was not available to Bingham J in the present case. Counsel for BT drew on the analysis of Judge Wilkey, who delivered the majority judgment in that case, and urged this court to do likewise in considering the problem in the present case. In order to place counsel’s   [*480]  submissions in their context, it will be necessary briefly to summarise the relevant principles stated by Judge Wilkey. This is no easy task. The judgment is substantial both in content and in length. I have studied it with interest and, indeed, respect.

 

Laker Airways Ltd v Sabena Airlines and KLM Airlines is concerned with the unhappy clash of jurisdiction which has occurred between courts in this country and courts in the United States, following on the commencement by the liquidators of Laker of antitrust proceedings in the United States against a number of international airlines, alleging that their combined activities were the cause of Laker’s  downfall. Among the airlines so sued were two British airlines, British Airways and British Caledonian. Following the making of an order by the Secretary of State for Trade and Industry in this country (acting under powers conferred on him by Act of Parliament) which had the effect of prohibiting the two British airlines from complying with “United States antitrust measures”, the Court of Appeal in this country granted an injunction restraining Laker from taking any steps against British Airways and British Caledonian in the United States action (see British Airways Board v Laker Airways Ltd [1983] 3 All ER 375, [1984] QB 142). Meanwhile, in the United States Laker obtained temporary restraining orders from the District Court restraining other airlines from instituting in the courts of this country similar proceedings for an injunction. Two of those airlines, KLM and Sabena, challenged the District Court’s  preliminary injunction on appeal to the Court of Appeals. The Court of Appeals, by a majority, declined to overturn the injunction so granted.

 

In the course of his judgment Judge Wilkey analysed in depth the applicable principles of law. I am only concerned, for present purposes, with his consideration of the propriety of what he called “the antisuit injunction”. I shall summarise the principles stated by him as briefly as I can, though I realise that so brief a summary cannot do justice to his reasoning.

 

(1) He observed that the sufficiency of jurisdictional contacts with both the United States and England resulted in concurrent jurisdiction to prescribe, but he continued (at 926–927):

 

“However, the fundamental corollary to concurrent jurisdiction must ordinarily be respected: parallel proceedings on the same in personam claim should ordinarily be allowed to proceed simultaneously, at least until a judgment is reached in one which can be pled as res judicata in the other … For this reason, injunctions restraining litigants from proceeding in courts of independent countries are rarely issued [though] a second reason cautioning against exercise of the power is avoiding the impedance of the foreign jurisdiction.”

 

And (2):

 

“There are no precise rules governing the appropriateness of antisuit injunctions. The equitable circumstances surrounding each request for an injunction must be carefully examined to determine whether, in the light of the principles outlined above, the injunction is required to prevent an irreparable miscarriage of justice.”

 

However, (3) injunctions are most often necessary (a) to protect the jurisdiction of the enjoining court or (b) to prevent the litigant’s  evasion of the important public policies of the forum.

 

(4) With regard to (3)(a) above, viz protection of the jurisdiction of the enjoining court, a distinction was drawn between cases where the enjoining court has proceeded to judgment on the merits, and cases where an injunction is requested to protect the court’s  jurisdiction before a judgment has been reached. In the former case there is little interference with the rule favouring parallel proceedings in matters subject to concurrent jurisdiction so a court may protect the integrity of its judgments by preventing their evasion through vexatious or oppressive relitigation (see, eg, Bethell v Peace (1971) 441 F 2d 459). In the latter case the factors which might support the issue of an injunction do not usually outweigh the importance of permitting foreign concurrent actions; and the policies underlying the rule permitting parallel proceedings in concurrent in personam  [*481] actions are more properly considered in a motion for dismissal for forum non conveniens. Even so, there must be circumstances in which an antisuit injunction is necessary to conserve the court’s  ability to reach a judgment, and the District Court’s  injunction was proper on that basis.

 

(5) With regard to (3)(b) above, viz preventing the litigant’s  evasion of the important public policies of the forum, an antisuit injunction will issue to preclude participation in the litigation only when the strongest equitable factors favour its use. Among the authorities cited by Judge Wilkey where such an injunction has issued was Cole v Cunningham (1890) 133 US 107, a case concerned with protecting the exercise of bankruptcy jurisdiction. Judge Wilkey further considered that the District Court’s  injunction properly prevented KLM and Sabena from attempting to escape the application of the United States antitrust laws to the conduct of business in the United States.

 

Counsel for BT urged us to adopt a similar approach in the present case to that adopted by Judge Wilkey in his analysis, and in particular to distinguish, on the basis of both English and United States authorities, the two groups of cases where injunctions may be granted, viz to protect the jurisdiction of the court and to prevent the litigant’s  evasion of the important public policies of the forum. The present case before us fell, submitted counsel for BT, within these principles. He asked us to approach the case by considering first whether, if BT in London and BTTC in New York had been a single entity and all relevant events had happened in England, proceedings in this country similar to those commenced by Mr Karoon in New York would have been struck out as an abuse of process. He submitted that they would, because such proceedings would have infringed both the public interest in making available all relevant evidence for the court and the public interest that there should be finality in litigation. That being so, he submitted that it made no difference that Mr Karoon had commenced his proceedings not in this country but in New York, because the English court, in protecting the integrity of its own jurisdiction, should now allow a litigant, subject to its jurisdiction, to bring such an action in a foreign jurisdiction. Furthermore, he submitted, having regard to the basis of the jurisdiction, the court should not be deflected from giving effect to its public policy by the fact that BT and BTTC are different legal entities; otherwise it would be sacrificing substance to form.

 

As an alternative to this main line of argument, counsel for BT invoked the principles enunciated by the House of Lords in recent cases concerned with alternative forums, viz MacShannon v Rockware Glass Ltd [1978] 1 All ER 625, [1978] AC 795 and Castanho v Brown & Root (UK) Ltd [1981] 1 All ER 143, [1981] AC 557, and submitted that, on the “critical equation” referred to in those cases, the balance pointed towards requiring Mr Karoon to litigate in England.

 

In considering the submissions of counsel for BT, I recognise that it is not merely legitimate but desirable that courts in this country should pay due regard to developments in sister common law jurisdictions, notably the United States; this is especially desirable when the court is concerned with principles of law affecting the relationship between our two jurisdictions and when we are presented with an analysis as profound as that of Judge Wilkey in Laker Airways Ltd v Sabena Airlines and KLM Airlines. Even so, we have to proceed with due caution. Not only do we have to operate within the confines of the doctrine of precedent in this country, but we have to bear in mind that the development of the relevant principles of law in our two countries may not be identical. Frequently, however, under the influence of history and of practical pressures to which both jurisdictions are subject, it transpires that there have taken place in our two jurisdictions parallel developments which, though neither simultaneous nor identical, reveal a very similar trend.

 

This is just what we find in the case of what American lawyers call “antisuit injunctions”. At bottom, the fundamental principles appear to have developed along similar lines. Thus, the jurisdiction is very wide, being available for exercise whenever justice demands the grant of an injunction. Again, the English court does not attempt to restrain the foreign court, but operates in personam, restraining a party from instituting or prosecuting the suit in the foreign jurisdiction; though an injunction will only be  [*482]  granted to restrain a person who is regarded as being properly amenable to the jurisdiction of the English courts. Furthermore, it has been repeatedly stated that the jurisdiction must be exercised with extreme caution, indeed sparingly: this is partly because concurrent proceedings in different jurisdictions are tolerated, but also because of a desire to avoid conflict with other jurisdictions. For it is accepted, as is indeed obvious, that courts of two different jurisdictions, one in this country and one in a foreign country, can have jurisdiction over the same dispute. It is not prima facie vexatious for the same plaintiff to commence two actions relating to the same subject matter, one in England and one abroad; but the court may be less ready to tolerate suits in two jurisdictions in the case of actions in rem than it is in the case of actions in personam. All these principles are well established, and indeed non-controversial, and appear to be common to both the English and the United States jurisdictions.

 

But the jurisdiction to grant such an injunction has only rarely been exercised in this country. The earliest cases in which the jurisdiction was established do not necessarily provide authoritative examples of its exercise today; indeed one of them (Bushby v Munday (1821) 5 Madd 297, [1814-23] All ER Rep 304) was later to be described by Lord Brougham as going to the “very verge of the law” (see Carron Iron Co v Maclaren Dawson & Stainton (1855) 5 HL Cas 416 at 446, 10 ER 961 at 973). In the course of the nineteenth century, there developed a line of cases in which assets were being administered by the English court, and one interested person sought to gain an advantage over other interested persons by prosecuting proceedings in a foreign country where part of the assets were situated. In such cases, for example, where a person sought in this way to gain the benefit of foreign assets of an estate after a decree of administration (see, eg, Graham v Maxwell (1849) 1 Mac & G 71, 47 ER 1043), or of a bankrupt after his petition in bankruptcy (see, eg, Re Distin, ex p Ormiston (1871) 24 LT 197), or of a company after winding-up proceedings had been commenced (see, eg, Re North Carolina Estate Co (1889) 5 TLR 328), such a person has been restrained by injunction from pursuing foreign proceedings, but only if he were a domiciled Englishman or otherwise amenable to the jurisdiction of the English court. In the later nineteenth century, however, following the decisions of the Court of Appeal in McHenry v Lewis (1882) 22 Ch D 397 and Peruvian Guano Co v Bockwoldt (1883) 23 Ch D 225, [1881-5] All ER Rep 715, it became accepted that, at least in the case of actions in personam, concurrent proceedings by the same party in this country and abroad were not prima facie vexatious, and the proceedings abroad should not therefore be restrained. It was for the party seeking an injunction to prove that the proceedings abroad were vexatious; for that purpose, he had generally to show that the plaintiff in the foreign court could not obtain an advantage from the foreign procedure which he could not obtain in the English court (see in particular Hyman v Helm (1883) 24 Ch D 53 and Cohen v Rothfield [1919] 1 KB 410, [1918-19] All ER Rep 260). That criterion was very rarely fulfilled; for examples where it was fulfilled see Armstrong v Armstrong [1892] P 98, Moore v Moore (1896) 12 TLR 221 and Christian v Christian (1897) 67 LJP 18.

 

Injunctions have however also been granted to restrain proceedings brought in breach of contract (see Lett v Lett [1906] 1 IR 618 and The Tropaioforos (No 2) [1962] 1 Lloyd’s  Rep 410), and to restrain enforcement of a judgment obtained fraudulently (see Ellerman Lines Ltd v Read [1928] 2 KB 144, [1928] All ER Rep 415). Putting aside these latter cases, however, and without attempting to cut down the breadth of the jurisdiction, the golden thread running through the rare cases where an injunction has been granted appears to have been the protection of the jurisdiction; an injunction has been granted where it was considered necessary and proper for the protection of the exercise of the jurisdiction of the English court. This can be said not only of cases where assets were being administered by the English court but also of cases where proceedings abroad were restrained as vexatious, for a party who attempts to reap the benefit of proceeding vexatiously is interfering with the proper course of administration of justice here (for an example, see Armstrong v Armstrong [1892] P 98 at 101 per Jeune J). But there was this difference between these two groups of cases: that, whereas in the latter group the foreign proceedings were regarded as vexatious because the plaintiff could derive no advantage  [*483]  from them, in the former group he was restrained precisely because he might gain an advantage from the foreign proceedings.

 

Now at one time it was thought that the requirement that proceedings must be vexatious was applicable, not only to the exercise of the court’s  jurisdiction to restrain a party from instituting or prosecuting foreign proceedings, but also to the exercise of the court’s  jurisdiction to stay proceedings commenced in this country: see again McHenry v Lewis and Peruvian Guano Co v Bockwoldt. A stay would only be granted if the continuance of the action in this country would be oppressive or vexatious to the defendant or otherwise an abuse of the process of the court, and if a stay would not cause an injustice to the plaintiff: see St Pierre v South American Stores (Gath & Chaves) Ltd [1936] 1 KB 382 at 398, [1935] All ER Rep 408 at 414 per Scott LJ. Again, these criteria were rarely fulfilled. However, in The Atlantic Star, Atlantic Star (owners) v Bona Spes (owners) [1973] 2 All ER 175, [1974] AC 436, the House of Lords recognised that this very restrictive criterion for staying proceedings in this country was too nationalistic: Lord Reid referred to it as a “rather insular doctrine” (see [1973] 2 All ER 175 at 181, [1974] AC 436 at 453). In that case the court relaxed the criteria of “oppression” and “vexation”. Four years later, in MacShannon v Rockware Glass Ltd [1978] 1 All ER 625, [1978] AC 795, the House of Lords relaxed the criteria still further, abandoning altogether the criteria of “oppression” and “vexation”, and adopting a principle which is now accepted to be indistinguishable from the principle of forum non conveniens as accepted in Scottish law (see The Abidin Daver [1984] 1 All ER 470, [1984] AC 398. A parallel development has taken place in the United States: see Gulf Oil Corp v Gilbert (1947) 330 US 501, and Piper Aircraft Co v Reyno (1981) 454 US 235.

 

On these authorities it may be observed that there are strong similarities in the way in which the law on this topic has developed in both countries. However, in 1981 there occurred a development in this country which has sharply differentiated the two jurisdictions. In Castanho v Brown & Root (UK) Ltd [1981] 1 All ER 143, [1981] AC 557, Lord Scarman (who delivered a speech with which the remainder of the Appellate Committee agreed) treated the criteria applicable to the exercise of the court’s  discretion to impose a stay or grant an injunction as identical. He said ([1981] 1 All ER 143 at 150, [1981] AC 557 at 574):

 

“It is unnecessary now to examine the earlier law. The principle is the same whether the remedy sought is a stay of English proceedings or a restraint upon foreign proceedings.”

 

After referring to The Atlantic Star, he quoted a passage from Lord Diplock’s  speech in MacShannon v Rockware Glass Ltd [1978] 1 All ER 625 at 630, [1978] AC 795 at 812 as embodying his distillation of principle in the case of a stay, which reads as follows:

 

“In order to justify a stay two conditions must be satisfied, one positive and the other negative: (a) the defendant must satisfy the court that there is another forum to whose jurisdiction he is amenable in which justice can be done between the parties at substantially less inconvenience or expense, and (b) the stay must not deprive the plaintiff of a legitimate personal or juridical advantage which would be available to him if he invoked the jurisdiction of the English court.”

 

Lord Scarman then said (1981] 1 All ER 143 at 151, [1981] AC 557 at 575):

 

“Transposed into the context of the present case, this formulation means that to justify the grant of an injunction the defendants must show (a) that the English court is a forum to whose jurisdiction they are amenable in which justice can be done at substantially less inconvenience and expense, and (b) that the injunction must not deprive the plaintiff of a legitimate personal or juridical advantage which would be available to him if he invoked the American jurisdiction. The formula is not, however, to be construed as a statute. No time should be spent in speculating what is meant by "legitimate". It, like the whole of the context, is but a guide to  [*484]  solving in the particular circumstances of the case the "critical equation" between advantage to the plaintiff and disadvantage to the defendants.” (Lord Scarman’s  emphasis.)

 

Lord Scarman did not apparently consider it necessary to give reasons for his opinion that the principle is the same whether the remedy sought is a stay of English proceedings or a restraint on foreign proceedings, and that it was therefore unnecessary, having regard to the decisions of the House of Lords in The Atlantic Star and MacShannon’s  case, both of which related only to a stay of English proceedings, to examine earlier case law on restraint of foreign proceedings. As I have recorded, it is now recognised that the principle applicable in the case of a stay of foreign proceedings is indistinguishable from the Scottish principle of forum non conveniens. This latin tag is, like many others, misleading: proceedings in the English forum are stayed not because England is an inconvenient forum, but because there is another clearly more appropriate forum abroad. The classic statement of principle is to be found in the judgment of Lord Kinnear in Sim v Robinow (1892) 19 R 665 at 668, when, after stating that the court would not refuse to exercise its jurisdiction “upon the ground of a mere balance of convenience and inconvenience”, he said that:

 

“The plea can never be sustained unless the court is satisfied that there is some other tribunal, having competent jurisdiction, in which the case may be tried more suitably for the interests of all the parties and for the ends of justice.”

 

A similar principle was adopted by Lord Sumner in Société du Gaz de Paris v SA de Navigation Les Armateurs Français 1926 SC(HL) 13 at 22, when he said that the object was to find “that forum which was the more suitable for the ends of justice”.

 

It follows that the policy underlying the principle of forum non conveniens is a policy of declining to exercise jurisdiction where there is another clearly more appropriate forum; though, if in such circumstances trial in England would offer the plaintiff a real advantage, a balance must be struck and the court must decide in its discretion whether justice requires a stay. This policy, avowedly less nationalistic than the old principle of vexation or oppression as applied in the past in cases of stay of proceedings, is one which is given effect to, on an application by the defendant, by a court of the forum in which there have been commenced proceedings over which the court has jurisdiction. It is a self-denying ordinance. The principle (derived from the speeches of their Lordships in MacShannon’s  case) was so interpreted and applied in Trendtex Trading Corp v Crédit Suisse [1980] 3 All ER 721, [1980] QB 629, with the approval of the House of Lords in that case, Lord Roskill describing the judge’s  approach as “entirely correct in principle” (see [1981] 3 All ER 520 at 532, [1982] AC 679 at 705). Furthermore, the exercise of the judge’s  discretion, so approved, in that case involved the granting of a stay, although the plaintiff was thereby deprived of a most valuable juridical advantage in this country, viz discovery of documents in accordance with English rules of procedure. It appears therefore that a juridical advantage of the plaintiff in this country will not necessarily be decisive. (That this is indeed so can be illustrated by the often-quoted example of a road accident involving two motorists in a foreign country, both being resident nationals of that country: one seizes the opportunity given by the casual presence of the other in this country to serve proceedings on him here, with the aim of recovering the higher damages available in the English courts. The English court would surely order a stay of proceedings on the application of the defendant, though the plaintiff’s  whole purpose in proceeding here was to obtain the juridical advantage of higher damages.) The decision of the House of Lords in the Trendtex case was followed by the Court of Appeal in European Asian Bank AG v Punjab and Sind Bank [1982] 2 Lloyd’s  Rep 356. The principles in these two cases, derived from all the speeches of the House of Lords in MacShannon’s  case and approved by the House of Lords in the Trendtex case, are, I understand, regularly followed in the Commercial Court, where cases of this kind tend to arise for decision.

 

In Castanho v Brown & Root (UK) Ltd Lord Scarman has taken the principle of forum  [*485]  non conveniens as developed in relation to a stay of English proceedings where it was expressly developed in order to adopt a less nationalistic approach, ie to render the English courts less tenacious of proceedings started within its jurisdiction, and has applied it inversely in cases of restraint by the English courts of foreign proceedings. The effect would appear to be, not only that in cases of restraint of foreign proceedings the very restrictive principle of protection of the English jurisdiction has been abandoned, but also that the English court will now be more free to grant injunctions restraining foreign proceedings than it was in the past under the old case law. We should perhaps not be surprised to discover that the approach of Lord Scarman in Castanho’s  case is different from the approach of courts in the United States. There, as here, the grant of a stay of proceedings depends on the application of the principle of forum non conveniens (see, eg, Piper Aircraft Co v Reyno (1981) 454 US 235). But the grant of an injunction restraining foreign proceedings depends on the twin principles of protection of the jurisdiction of the court of the forum, and of preventing evasion of important public policies of the forum; and in each case the principles have been stated and applied in restrictive terms. So cases of stay of proceedings and of restraint of foreign proceedings are regarded as being founded on different principles. Furthermore, as appears from Judge Wilkey’s  opinion in Laker Airways Ltd v Sabena Airlines and KLM Airlines (1984) 731 F 2d 909, in the United States it is considered more appropriate, where there is a clash of jurisdiction, for a stay of proceedings to be considered by the court seised of the matter rather than for a court to establish its own forum as the more appropriate forum by granting an injunction restraining proceedings in a foreign court.

 

Given the present divergence between the principles applicable in our two countries, it is, I fear, very difficult for this court to respond to the submission of counsel for BT that we should proceed on the basis of Judge Wilkey’s  analysis in Laker Airways Ltd v Sabena Airlines and KLM Airlines. I can only console myself with the reflection that in any event counsel’s  submission appears to me to involve an illegitimate extension, in at least two respects, of the principles as stated by Judge Wilkey, and indeed of the principle as developed in the long line of English cases before Castanho.

 

I first address myself to the public interest that there should be finality in litigation. Such a public interest no doubt exists. Moreover, authorities can be found, both in this country and in the United States, in which courts have gone so far as to grant injunctions restraining persons properly amenable to their jurisdiction from relitigating abroad matters which have already been the subject of a judgment of the court of the forum. For an English example, see the old case of Booth v Leycester (1837) 1 Keen 579, 48 ER 430; and for an American example, see Bethell v Peace (1971) 441 F 2d 495. The Tropaioforos (No 2) [1962] 1 Lloyd’s  Rep 410 could perhaps also be treated as falling under this head, though it contained the exceptional feature that the litigant sought to be restrained had entered into an agreement with all underwriters to be bound by the outcome of the proceedings, thereby providing a contractual basis for the grant of the injunction. However, I do not regard the present case as falling under this head of public policy. In the New York proceedings, Mr Karoon is not, as I understand it, seeking to relitigate a matter which has been the subject of a judgment in this country. He is seeking rather to obtain redress from a bank in New York in respect of disclosure of confidential information by that bank in New York. I cannot see that the mere fact that Mr Karoon had an opportunity, which he did not take, to object to Mr Saunders’s  affidavit being put in evidence on the striking out application in London has any effect on the situation. The simple fact is that the cause of action alleged by Mr Karoon against BTTC has not been the subject of a judgment in this country. I can therefore see no basis for this submission of counsel for BT.

 

The second submission of counsel for BT however raises more difficult problems. He asserted a public interest in making available all relevant evidence for the court. This public interest was, he submitted, exemplified by the rule that statements in affidavits are absolutely privileged in defamation proceedings (see Trapp v Mackie [1979] 1 All ER 489 at 491, [1979] 1 WLR 377 at 378–379 per Lord Diplock), and by the rule that  [*4786  victimisation of a witness on account of evidence he has given is a contempt of court (see Chapman v Honig [1963] 2 All ER 513 at 517, [1963] 2 QB 502 at 512 per Lord Denning MR). His original submission before us was that, on this principle, BT could not be sued for adducing evidence in the interpleader summons. However, in the course of argument he recognised that the gravamen of his submission lay in a litigant seeking to recover damages in respect of the disclosure of material evidence in proceedings, when the only damage suffered was (it was submitted) a failure to achieve a result which would have been achieved had the material evidence not been disclosed. As a matter of public policy such damages should not, submitted counsel for BT, be recoverable in law.

 

Now this submission does indeed raise novel and difficult problems. It cannot be said to be entirely without substance, but it was not founded on any authority cited to us, either from this country or from the United States. Furthermore, if any such policy exists, as proposed by counsel, it may be given effect to as part of the lex fori; and it does not necessarily follow that a court of this country would give effect to it by an injunction restraining proceedings in another jurisdiction. We have also always to bear in mind the restraint we must impose on ourselves before taking any steps which might bear on the exercise by the courts of another country of its own jurisdiction. However, in the present case, I must desist from exploring this interesting and novel proposition, because there is in my judgment a fatal obstacle to the argument of counsel for BT. This is that the evidence in question was adduced in a court of this country not by BTTC, but by BT. The proceedings which counsel is asking this court to restrain are proceedings by Mr Karoon against BTTC, in respect of their having divulged confidential information not to the English court but to BT. I cannot for my part see that the public policy now asserted by counsel should (assuming that it exists) provide any ground for restraining those proceedings. Counsel suggested beguilingly that it would be technical for us to distinguish between parent and subsidiary company in this context; economically, he said, they were one. But we are concerned not with economics but with law. The distinction between the two is, in law, fundamental and cannot here be bridged. For this reason, I should in any event have dismissed this argument.

 

I turn then to consider the alternative submission of counsel for BT, which was founded on Lord Scarman’s  speech in Castanho’s  case [1981] 1 All ER 143, [1981] AC 557. This was to the effect that, applying the principles in MacShannon’s  case [1978] 1 All ER 625, [1978] AC 795, the balance points towards requiring Mr Karoon to litigate in England. He relied in this connection in particular on the following factors: proceedings were already on foot in London between BT and Mr Karoon; the issue whether Mr Karoon was entitled to the moneys in question will in any event have to be decided in the interpleader issue in London; there is no dispute of fact over what happened in New York, and the principles of law on bankers’ confidentiality in New York and London are substantially the same; the critical question whether the provision of information caused any loss to Mr Karoon would be better decided here; and Mr Karoon has no legitimate juridical advantage in New York.

 

I have to confess that I find the consequences of this argument to be startling. There is no pending litigation in this country between Mr Karoon and BTTC; that of itself would render any order by the English court restraining the action in New York a remarkable restraint on the prosecution of proceedings in that state. Even if England were to be regarded by the English court as a clearly more appropriate forum, or the natural forum, for the trial of the action, I feel the gravest reservations about an English court granting an injunction restraining Mr Karoon from proceeding in New York rather than allowing a court of that state, being the forum having jurisdiction where an action has already been commenced, making its own decision whether England is the more appropriate forum and whether it should in the circumstances grant a stay of proceedings. But in any event I am not prepared to hold that England is a clearly more appropriate forum for the trial of the action between Mr Karoon and BTTC. The cause of action arose in New York. One of the parties is a New York corporation: the other is an Iranian citizen resident in France. The applicable law is the law of the State of New York; and, even if  [*487]  New York law on breach of confidence by a banker shares a common origin with our own law on the subject, I am not prepared to assume in the present case that they are identical, and in any event there are other legal issues in the case (for example, a claim to penal damages). Taking into account the factors relied on by counsel for BT, I cannot see that they displace the strong connection with the New York jurisdiction. That being so, on the principles expounded by the House of Lords in MacShannon’s  case, as interpreted with the approval of the House of Lords in the Trendtex case [1981] 3 All ER 520, [1982] AC 679, there can be no basis, on the inverse application of the principle of forum non conveniens, to grant an injunction restraining Mr Karoon from continuing with his proceedings against BTTC in New York.

 

For these reasons, I would dismiss the appeal.

 

Appeal dismissed. Leave to appeal to the House of Lords refused. Injunctions to continue over hearing of any petition for leave to appeal.