Andrea Merzario Limited v Internationale Spedition Leitner Gesellschaft GmbH [2001] EWCA Civ 61

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM QUEEN'S BENCH DIVISION
COMMERCIAL COURT
(Mr Justice LONGMORE)
[2001] EWCA Civ 61Case No Case No: 2000/2567/A3Venue Royal Courts of Justice, Strand, London,, WC2A 2LL, Tuesday 23 January 2001
Between
Andrea Merzario LimitedClaimant/ RespondentInternationale Spedition Leitner Gesellschaft GmbHDefendant/ Appellant
Before
Lord Justice ChadwickLord Justice RixMr Robert Bright (instructed by Messrs Clyde & Co for the Claimant/Respondent)Mr David Mildon QC (instructed by Messrs Field Fisher Waterhouse for the Defendant/Appellant)Date 23 January 2001

LORD JUSTICE RIX:

This

[1]appeal raises some interesting questions concerning article 31 of the Convention for the International Carriage of Goods by Road, signed at Geneva on 19 May 1956 ("CMR"). In Cummins Engine Co v Davis Freight Forwarding (Hull) [1981] 2 Lloyd's Rep 106 at 109, Mocatta J described CMR as "notoriously difficult". Its reputation is intact.[2]The basic facts are swiftly stated. The claimant, Andrea Merzario Limited ("Merzario") was the contracting carrier for the carriage of a consignment of whisky from Scotland to Vienna. The contract of carriage was made on 15 March 1999. The defendant, Internationale Spedition Leitner Gesellschaft GmbH ("Leitner"), was Merzario's sub-contractor. Leitner is an Austrian company. Leitner in turn sub-contracted the carriage to a local Scottish carrier. The whisky was stolen on 17 March 1999, before it had left these shores, although whether it had already passed out of Scotland into England is uncertain. Merzario has paid a claim for the whisky's loss and seeks in these proceedings to recover an indemnity or contribution from Leitner pursuant to CMR.[3]This action was commenced by Merzario against Leitner on 15 October 1999. By then Leitner had already commenced its own action against Merzario in the Commercial Court of Vienna, which it did by issuing proceedings on 16 July 1999. However, the Viennese proceedings, although commenced first, were served second, for the English action was served on Leitner on 21 October, whereas the Austrian action was only served on Merzario on 22 December 1999.[4]In the meantime on 1 September 1999 the Austrian Supreme Court had, on Leitner's motion, designated the Commercial Court of Vienna as the local venue for the case, confirming the existence of jurisdiction in Austria as the country within whose territory the place designated for delivery under the contract was situated, pursuant to article 31(1)(b) of CMR.[5]Although this court was referred by Mr David Mildon QC on behalf of Leitner to the order made by the Austrian Supreme Court on 1 September 1999, he did not submit that that order marked any critical stage in the Austrian action. His submission was rather that the Austrian action became a "pending" action for the purpose of article 31(2) of CMR straightaway upon issue of those proceedings. On behalf of Merzario, on the other hand, Mr Robert Bright submitted that it was only upon service that an action became "pending" under article 31(2). Mr Mildon relied on the order of 1 September 1999 therefore as being indicative of the significance of issue and of the stage before service under Austrian law, rather than in its own right.[6]Merzario's claim form in England states that its claim is for damages or an indemnity in respect of breach of the contract of carriage or for negligent breach of duty in or about the handling of the whisky. Its particulars of claim were served in February 2000. They show that the claim is in respect of the value of the lost whisky in the sum of over £117,000.[7]Leitner's Austrian claim form is not before the court, but in its order of 1 September 1999 the Austrian Supreme Court refers to Leitner's allegation that it is not liable to Merzario by reason of article 17(2) of CMR ( sc the provision there regarding "circumstances which the carrier could not avoid and the consequences of which he was unable to prevent") on the ground that "the driver has taken all reasonable security precautions"; and also to the allegation that Leitner is in any event not liable for that part of the claim represented by "excise duties". Whisky stolen in the UK, even if destined for export, attracts excise duty. The question whether a carrier is liable under CMR for such duties was the point which the House of Lords was called upon to decide in James Buchanan & Co Ltd v. Babco Forwarding & Shipping (UK) Ltd [1978] AC 141. It there held that "other charges incurred in respect of the carriage" within article 23(4) should be construed broadly to cover the duty. It appears that Leitner is contending that a different interpretation prevails or should prevail in Austria. It would also appear that Leitner's action in Austria takes the form of an action for a negative declaration of non-liability. It is as such that it has been treated in submissions in this court.[8]The question is whether article 31 does or does not bar Merzario's English action for damages on the basis of Leitner's action for a declaration of non-liability. This is a question of lis pendens , an expression which, although in Latin rather than the vernacular, I may perhaps be permitted to use since it has an international currency in an area of (private) international law. As will be seen, the expression "pending" is used in article 31(2). Article 31 of CMR[9]Article 31 provides as follows:
"1. In legal proceedings arising out of carriage under this Convention, the plaintiff may bring an action in any court or tribunal of a contracting country designated by agreement between the parties and, in addition, in the courts or tribunals of a country within whose territory (a) the defendant is ordinarily resident, or has his principal place of business, or the branch or agency through which the contract of carriage was made, or (b) the place where the goods were taken over by the carrier or the place designated for delivery is situated, and in no other courts or tribunals. 2. Where in respect of a claim referred to in paragraph 1 of this article an action is pending before a court or tribunal competent under that paragraph, or where in respect of such a claim a judgment has been entered by such a court or tribunal no new action shall be started between the same parties on the same grounds unless the judgment of the court or tribunal before which the first action was brought is not enforceable in the country in which the fresh proceedings are brought. 3. Where a judgment entered by a court or tribunal of a contracting country in any such action as is referred to in paragraph 1 of this article has become enforceable in that country, it shall also become enforceable in each of the other contracting States, as soon as the formalities required in the country concerned have been complied with. The formalities shall not permit the merits of the case to be re-opened. 4. The provisions of paragraph 3 of this article shall apply to judgments after trial, judgments by default and settlements confirmed by an order of the court, but shall not apply to interim judgments or to awards of damages, in addition to costs against a plaintiff who wholly or partly fails in his action..."
[10]Article 31 falls together with articles 30 and 32/33 in chapter V of CMR, which is headed "Claims and Actions". Article 30 is concerned with detailed provisions concerning loss, damage or delay to goods. Article 32 deals with periods of limitation. The basic limitation period is one year, but that period begins to run at slightly different times depending on whether there is a claim for partial loss, damage or delay, or total loss of goods, or some other claim. In the case of wilful misconduct, however, the period of limitation becomes three years. There is a special provision that a written claim against a carrier may suspend the period of limitation until the claim has been rejected (article 31(2)). Article 32(4) is of some interest – "A right of action which has become barred by lapse of time may not be exercised by way of counter-claim or set-off."[11]I refer to that because it is a necessary corollary of Mr Mildon's submission that the effect of article 31(2) is to canalise claims into a single forum, even where the first action is merely that for a declaration of non-liability, that the defendant to such an action should have an appropriate opportunity to bring the substantive claim which he had started in the second forum by way of counterclaim in the first forum.[12]Article 33 is concerned with arbitration. The four issues[13]The appeal raises four issues, of which one has been conceded at the hearing, and the other three are still live. They are:(i) Is the English court a competent court for the purposes of article 31(1)(b) as the court "of a country within whose territory…the place where the goods where taken over by the carrier…is situated"?(ii) Was the Austrian action "pending" when commenced but not yet served?(iii) In any event, is an action in which the sole relief sought is a claim for a negative declaration such an action within the meaning of article 31(2) as may, if "pending", bar a further action ("no new action may be started") between the same parties on the same grounds?(iv) Were the Austrian and English actions in any event "on the same grounds"?[14]In form this is an appeal from a judgment of Longmore J. In substance, however, the single point decided by Longmore J (issue (i) under article 31(1)) is no longer controversial, for it is now accepted, as Longmore J ruled, that any court within the territory of a contracting country is competent (subject possibly to considerations of forum non conveniens) for the purposes of article 31(1), even if, as occurred in this case, the goods were taken over by the carrier in Scotland but the action has been commenced in the courts of England, which can for other purposes be described as a different country from Scotland. Nevertheless, since the UK as a whole is the contracting country for the purposes of CMR, it follows that the courts of Scotland and England are within the same "country" for the purposes of article 31(1). That, as I say, was accepted by Leitner when it abandoned its appeal on issue (i).[15]In substance, therefore, this appeal is really concerned with seeking to displace the construction of article 31(2) favoured by Colman J in another case, reported as Frans Maas Logistics (UK) Ltd v CDR Trucking BV [1999] 2 Lloyd's Rep 179. There Colman J held that a claim for a negative declaration could not give rise to a "pending" action within the meaning of article 31(2), and that in any event an action for a negative declaration and an action for substantive monetary relief were not "on the same grounds". Longmore J was content to follow Colman J's decisions to this effect, in the light of Leitner's counsel's acceptance that on the interpretation of CMR it was important that the Commercial Court speaks with one voice. Thus issues (iii) and (iv) come before this court on the basis of the judgment in Frans Maas . It also followed from the willingness of counsel and judge below to follow Frans Maas , that the further issue (issue (ii)), as to whether an action which had been commenced but not yet served was a "pending" action within article 31(2), did not need to be addressed, but like issues (iii) and (iv) were reserved for argument on appeal.[16]Thus, on issue (i) nothing more needs to be said; on issue (ii), the argument before this court was not considered below; and on issues (iii) and (iv), the judgment which has to be considered is that of Colman J in Frans Maas . CMR and its interpretation[17]Before turning to the issues themselves, I should say something about CMR. It has entered English law as a Schedule to the Carriage of Goods by Road Act 1965. Since the Civil Jurisdiction and Judgments Act 1982, which brought the Brussels Convention on Jurisdiction and Enforcement of Judgments in Civil and Commercial Matters of 1968 (the "Brussels Convention") into English law, the English courts have become familiar with articles 21 and 22 of that Convention, with their concepts of "first seised" and "the same cause of action", and also with the jurisprudence of both the European Court of Justice and the English courts on the nature of such concepts. It is worth reminding oneself, therefore, that CMR, whose date is 1956, predates the Brussels Convention by 12 years, and was sponsored not by the European nations which first signed the Treaty of Rome but by the United Nations. The learning of the Brussels Convention is therefore an uncertain guide to difficulties of construction under article 31 of CMR. Nevertheless the contracting parties are confined to states within Europe, with the exceptions of Russia and Turkey whose borders extend beyond Europe. Its genesis was largely the work of a committee set up by a Working Party on Legal Questions, a subsidiary organ of the Inland Transport Committee of the United Nations Economic Commission for Europe. The negotiations were conducted mostly in French. The only authentic languages of the text are French and English. The working papers, in French and English, are deposited in the Library of the United Nations at Geneva.[18]The leading case on the interpretation of CMR in English law is Buchanan v. Babco . The House of Lords there applied the famous statement of Lord Macmillan in Stag Line Ltd v. Foscolo, Mango & Co Ltd [1932] AC 328 at 350 as to the correct approach to the construction of the Hague Rules. Lord Wilberforce said (at 152E/F):
"I think that the correct approach is to interpret the English text, which after all is likely to be used by many others than British businessmen, in a normal manner, appropriate for the interpretation of an international convention, unconstrained by technical rules of English law, or by English legal precedent, but on broad principles of general acceptance: Stag Line Ltd. v. Foscolo, Mango and Co. Ltd. [1932] A.C. 328, per Lord Macmillan, at page 350. Moreover, it is perfectly legitimate in my opinion to look for assistance, if assistance is needed, to the French text. This is often put in the form that resort may be had to the foreign text if (and only if) the English text is ambiguous, but I think this states the rule too technically. As Lord Diplock recently said in this House the inherent flexibility of the English (and, one may add, any) language may make it necessary for the interpreter to have recourse to a variety of aids: Carter v. Bradbeer [1975] 1 W.L.R. 1204, 1206. There is no need to impose a preliminary test of ambiguity."
[19]Lord Salmon spoke to similar effect (at 161B, G/H). Lord Dilhorne was more sceptical (at 156F) in particular as to the propriety or utility of consulting the French text (at 158F). Lord Edmund-Davies and Lord Fraser of Tullybelton, who were in the minority, were also sceptical of the utility of consulting the French text, at any rate unaided, but agreed with Lord Wilberforce about the propriety of doing so, provided however that the English version is ambiguous (at 166G/167C, 170C). I cannot help feeling that, over 20 years later, some of that scepticism would be moderated.[20]In Fothergill v. Monarch Airlines Ltd [1981] AC 251 , a case on the Warsaw Convention, the House of Lords held that, in consulting the French text of a convention, there was no need of qualified experts and the court could use its own knowledge of the foreign language. It also held that cautious use of the travaux préparatoires of such conventions could be made, provided three conditions were met: there was an ambiguity to be resolved, the material involved is public and accessible, and it must clearly and indisputably point to a definite legislative intention.[21]There is a dispute in this court as to whether it is appropriate to look at certain material under the guidance of that ruling. Hill & Messent, CMR : Contracts for the International Carriage of Goods by Road , 3 rd ed, 2000, at para 0.21 states that there are no travaux préparatoires available in relation to CMR in the sense spoken of in Fothergill , and at footnote 66 cites an opinion of the Dutch supreme court (29.6.90 (1990) 25 ETL 589, 627) that it is not possible to have regard to the drafting history of CMR since no travaux préparatoires have been published or made available for public consultation.[22]Unlike the Brussels Convention, there is no European Court of Justice to ensure a uniform approach throughout the contracting states to the interpretation of CMR. The doctrine of an "autonomous meaning", familiar from the jurisprudence of the Brussels Convention, therefore has uncertain status. There is a fair body of academic opinion, however, that, as far as possible, uniform law such as CMR should be autonomous and interpreted only by reference to itself (see Clarke, International Carriage of Goods by Road: CMR , 3 rd ed, 1997, at 15/16, and Haak, The CMR – Interpretation , at 224/7 of Theunis, International Carriage of Goods (CMR) , 1987). Nevertheless, since CMR is not a complete and self-contained code, foreign courts have frequently resorted to national law, at any rate where CMR is perceived as silent. It might be said that Buchanan v. Babco is not so much an authority in favour of the autonomous approach, as an approach which respects the objective of uniformity. But perhaps that is a distinction without a difference: see in any event In re H (Abduction: Acquiescence) [1998] AC 72 at 87, and R v. Secretary of State for the Home Department, ex parte Adan (HL, 19.12.00 at 12, 30). The jurisprudence on the Brussels Convention indicates that, even in the case of a code as self-contained as that, not everything is given an autonomous meaning. The parties in this court have wavered in their submissions on this question.[23]No decisions of foreign courts as to the interpretation or application of article 31(2) have been cited to the court on this appeal.[24]I turn now to the issues, beginning with issue (ii). Issue (ii): Was the Austrian action "pending" when commenced but not yet served?[25]It is to be observed that articles 31(1) and (2) speak in terms of bringing an action ("the plaintiff may bring an action" (article 31(1)), "the court or tribunal before which the first action was brought…the country in which the fresh proceedings are brought" (article 31(2)), of starting an action ("no new action shall be started" (article 31(2)), and of an action being pending ("Where…an action is pending before a court…" (article 31(2)). The French text also uses three different expressions, but not in quite the same way: thus "bring" in article 31(1) is matched by the expression saisir ("le demandeur peut saisir…les jurisdictions…"), whereas in article 31(2) "brought" is matched by intentée ("la jurisdiction devant laquelle la première action a été intentée…le pays où la nouvelle action est intentée") which is the same expression as is used to match the word "started" in the same paragraph ("il ne peut être intenté aucune nouvelle action"); and the expression "pending" is matched by en instance ("une action est en instance").[26]On this basis there is room for the view that article 31 distinguishes between starting or bringing an action on the one hand (être intenté), and an action being pending on the other hand (être en instance). Otherwise, there appears to be no reason why the same expression could not be used throughout, viz start or bring (être intenté).[27]On the other hand, Mr Mildon on behalf of Leitner submits that the juxtaposition in article 31(2) between the pending of the first action and the start (or bringing) of the second (or new or fresh) action indicates that the same concept, despite the change of language in both the English and the French texts, is and must be at work. And indeed the point can be made that, if an action can only be pending once service has been effected, then the prohibition on bringing a new action only operates after service of the first action brought ("Where…an action is pending…no new action shall be started…"). On that basis, if the second action is brought before service of the first action, there is nothing to prohibit the bringing of the second action, and both actions, albeit between the same parties on the same grounds, are permitted to continue. Therefore, it is said, the concept of pending is fulfilled as soon as the action is brought.[28]It is well known that English law distinguishes between the issue and service of a claim form, and that traditionally it is issue which marks the commencement or start or bringing of the proceedings, not service. Thus for limitation purposes it is the issue of the claim form which is critical, not service (provided of course there is due service in the proper course of events). On the other hand, the establishment of jurisdiction depends on service: if, therefore, the claim form has to be served out of the jurisdiction, then, save in the case of jurisdiction which is already provided for by the Brussels-Lugano Conventions, permission has to be obtained from the court even to issue a claim form for service out of the jurisdiction and in any event to serve such a claim form when once obtained. And it is only after service that the defendant is called upon to state whether he challenges the jurisdiction of the English court.[29]When, then, is an action pending under English law (if it is a question of English law, rather than a matter of an autonomous meaning, or even a matter for Austrian law)? That question was considered in Dresser UK Ltd v. Falcongate Freight Management Ltd [1992] 1 QB 502 for the purposes of article 22 of the Brussels Convention. Article 22 provides (emphasis added):
"Where related actions are brought in the courts of different contracting states, any court other than the court first seised may, while the actions are pending at first instance, stay its proceedings…"
[30]Article 21 similarly speaks in terms of "the court first seised". What does that expression mean? In Zelger v. Salinitri (Case 129/83) [1984] ECR 2397 the European Court of Justice had to answer that question. It did so by glossing the expression as meaning "the [court] before which the requirements for proceedings to become definitively pending are first fulfilled" (emphasis added), and continued "such requirements to be determined in accordance with the national law of each of the courts concerned" (para 16 at 2408).[31]The European Court explained the reasoning by which it arrived at this decision in the following paragraphs (at 2407/8):
"10. It should be pointed out that the rules of procedure of the various Contracting States are not identical as regards determining the date at which the courts are seised. "11. It appears from information on comparative law placed before the Court that in France, Italy, Luxembourg and the Netherlands the action is considered to be pending before the court from the moment at which the document initiating the proceedings is served upon the defendant. In Belgium the court is seised when the action is registered on its general roll, such registration implying in principle prior service of the writ of summons on the defendant. "12. In the Federal Republic of Germany the action is brought, according to Paragraph 253 (1) of the Zivilprozeßordnung, when the document initiating the proceedings has been served on the defendant. Service is effected of its own motion by the court to which the document has been submitted. The procedural stage between the lodging of the document at the registry of the court and service is called "
Anhängigkeit". The lodging of the document initiating the proceedings plays a role as regards limitation periods and compliance with procedural time-limits but in no way determines the moment at which the action becomes pending. It is clear from the aforementioned Paragraph 253, read together with Paragraph 261 (1) of the Zivilprozeßordnung, that an action becomes pending once the document initiating the proceedings has been served on the defendant. "13. It follows from the comparison of the legislation mentioned above that a common concept of lis pendens cannot be arrived at by a rapprochement of the various relevant national provisions. A fortiori , therefore, it is not possible to extend to all the contracting parties, as is proposed by the plaintiff in the main action, a concept which is peculiar to German law and which, because of its characteristics, cannot be transposed to the other legal systems concerned... "15. Since the object of the Convention is not to unify those formalities, which are closely linked to the organization of judicial procedure in the various States, the question as to the moment at which the conditions for definitive seisin for the purposes of Article 21 are met must be appraised and resolved, in the case of each court, according to the rules of its own national law. That method allows each court to establish with a sufficient degree of certainty, by reference to its own national law, as regards itself, and by reference to the national law of any other court which has been seised, as regards that court, the order or priority in time of several actions brought within the conditions laid down by the Convention."[32]Thus in Dresser v. Falcongate the court of appeal had to determine when under English law an English action becomes definitively pending. In that case the competition was between an action in the Commercial Court in London (where the writ was issued on 15 July 1988 but not served until 13 July 1989) and an action in the District Court in Rotterdam (where the proceedings were instituted on 21 February 1989). The court of appeal held that in English law the English action, although begun by the issue of the writ, did not become definitively pending until service. Thus the English court was not seised of the action until 13 July 1989. The case was remitted to the Commercial Court for it to find whether the Rotterdam court was seised of the matter before or after that date.[33]Bingham LJ said (at 522E/523C):
"Although (as recognised in Zelger v. Salinitri [1984] ECR 2397 ) practice on the Continent of Europe varies from country to country, Mr. Leggatt accepted that courts in those countries would not ordinarily regards themselves as seised of proceedings until (at earliest) the proceedings had actually been served on and thus brought to the attention of the defendant. But he pointed out that service and notice were not in all cases coincident. Thus under Dutch procedure, for example, a defendant resident abroad is treated as served when a copy of the proceedings is served on the officier van justitie for the issuing court, and the French procedure provides in similar circumstances that service is complete when the huissier delivers the proceedings to the ministère public. While grateful to be told of these departures from the ordinary rule, it does not affect my conclusion. We are concerned to analyse and apply English procedure, and we will review that of other countries only when an issue under the Convention falls to be decided. We must then accept their interpretation of their procedural law. It may, however, be that in other countries as well as this procedural rules will call for reconsideration in the light of the Convention. "
Mr. Leggatt urged that it would be contrary to the ratio of the Zelger decision to force English procedure into a straightjacket of European design. I agree. But the procedural idiosyncrasy is not (like national costume or regional cuisine) to be nurtured for its own sake and in answering the question before us we must have regard to the realities of litigation in this country and the purpose of the Convention, not to tradition, nomenclature or rules developed for other purposes. Despite the length of my approach to it the question is, at root, quite a short one. "With genuine respect to the contrary opinions of Hirst J. and Hobhouse J., it is in my judgment artificial, far-fetched and wrong to hold that the English court is seised of proceedings, or that proceedings are decisively, conclusively, finally or definitively pending before it, upon mere issue of proceedings, when at that stage (1) the court's involvement has been confined to a ministerial act by a relatively junior administrative officer; (2) the plaintiff has an unfettered choice whether to pursue the action and serve proceedings or not, being in breach of no rule or obligation if he chooses to let the writ expire unserved; (3) the plaintiff's claim may be framed in terms of the utmost generality; (4) the defendant is usually unaware of the issue of proceedings and, if unaware, is unable to call on the plaintiff to serve the writ or discontinue the action and unable to rely on the commencement of the action as a lis alibi pendens if proceedings are begun elsewhere; (5) the defendant is not obliged to respond to the plaintiff's claim in any way, and not entitled to do so save by calling on the plaintiff to serve or discontinue; (6) the court cannot exercise any powers which, on appropriate facts, it could not have exercised before issue; (7) the defendant has not become subject to the jurisdiction of the court." It will be observed that for these purposes the requirement was not merely that the proceedings be pending, but that they should be "definitively" pending, a matter remarked on by Bingham LJ at various points of his judgment, viz 519G/520D and 523A.[34]In Molins Plc v. GD SpA [2000] 1 WLR 1741, the court of appeal had to apply the Dresser v. Falcongate decision to a case where the competing jurisdictions were England and Italy. The English claim form was served on the defendant in Italy on 30 July 1999. Ten days earlier, on 20 July 1999, the defendant in Italy served the English claimant with an Italian writ by fax: under Italian law permission to serve by fax had to be obtained (and was obtained), but under the relevant bilateral treaty between England and Italy for the service of legal proceedings, service in England had to be in accordance with the rules for service in England, and they required that service by fax was only good service where the defendant had previously indicated his willingness to be served by fax, which was not the case. The court of appeal therefore found that the Italian court was not definitively seised, because(a) Italian law required service for an Italian court to be definitively seised, and(b) that would not occur under Italian law until the irregularity of the service by fax had been validated. That case is a good example, for the purpose of the test under the Brussels Convention, of how it is necessary to look at the requirements of both English law and the law of the competing foreign jurisdiction in order to decide whether one court had been seised earlier than the other, or in other words whether one action was already definitively pending before the other had become so.[35]For these purposes, it will be noted that the test is not whether one action had become definitively pending before the other action was brought, but which of the competing actions had first become definitively pending in its respective jurisdiction. This analogy, and it is no more than that, supports Mr Mildon's submission that in principle one would expect to find that the comparison in article 31(2) is between the same concepts, not different ones.[36]The evidence before the court is that Austrian law similarly distinguishes between the issue and service of proceedings For these purposes expert evidence was provided (in writing) by Dr Peter Csoklich on behalf of Leitner and by Dr Rainer Kornfeld on behalf of Merzario, both Viennese lawyers. They were in agreement as to the following:(a) that the Viennese action was filed on 16 July 1999, received by the Viennese Commercial Court on 19 July 1999, subject to a ruling by the Austrian Supreme Court that the case came under Austrian jurisdiction pursuant to article 31 of CMR and assigned to the Viennese Commercial Court on 1 September 1999, and served on Merzario on 22 December 1999;(b) that Austrian law distinguishes between two phases, the first phase starting with filing of the proceedings and going down to service ("Gerichtsanhängigkeit" or legal pendency), and the second phase beginning with service ("Streitanhängigkeit" or dispute pendency);(c) that a subsequent claim is only barred by the Austrian doctrine of lis pendens after the first claim has been served upon the defendant;(d) that there are no decisions in Austrian law whether for the purposes of article 31(2) of CMR the concept of "pending" corresponds to the Austrian concepts of Gerichtsanhängigkeit or Streitanhängigkeit respectively;(e) that Austrian courts hold that the provisions of CMR should be interpreted autonomously, without recourse to national law, in order to ensure a uniform interpretation, (unless, adds Dr Kornfeld, there is a gap in the Convention which has to be filled up by national law); and(f) that German law similarly distinguishes between Anhängigkeit ("pending" simpliciter) and "Rechtsanhängigkeit" (the German equivalent of Austria's Streitanhängigkeit), with similar effect. There, however, agreement ends.[37]Thus Dr Csoklich derives assistance from the German text of CMR (not of course an authentic text, but one which apparently was coordinated between Germany, Austria and Switzerland), which translates article 31(2)'s "pending" as simply anhängig : and on this basis he refers to writers, such as Basedow (in Münchener Kommentar zum HGB, Art 31 CMR, Note 32) and Demuth (in Thume, Kommentar zum CMR, Article 31, note 53), as support for the opinion that proceedings are "pending" from the date of filing. He also expresses the view that there is no gap in article 31 such as to permit reference to national law, and that Basedow has supplied an autonomous meaning for article 31, which would therefore be adopted by the Austrian courts, in his view that the adoption of the simple "anhängig" is a deliberate preference for the concept of pendency upon filing.[38]Dr Kornfeld on the other hand disputes the relevance of the German text, as being unauthentic, and points out that Löwe (in TranspR 1988, 309, 313, found translated into English in Theunis at 145, 152) implies that the contracting states could not reach agreement as to whether the pendency of an action should be judged by domestic or foreign procedural law. An intentional gap was therefore left in CMR for each state to resolve according to its lex fori ( Fremuth/Thume in Frachtrecht Art 31 CMR, Note 17). (Dr Roland Löwe was the Austrian negotiator for CMR and in 1975 published, under the auspices of the UN, a lengthy Commentary on CMR. I shall need to refer to Löwe's Commentary below.) Dr Kornfeld's view is that, despite the tendency of Austrian courts to be influenced by German court decisions where the law is the same, in the instant case Austria would be guided by its own Civil Procedure Code. He also cites Herber/Piper , CMR Art 31 Note 24, for the view, contrary to Basedow , that an action is pending only after service.[39]Seeing the reliance placed by Dr Csoklich on Basedow , I set out the passage referred to:
"The text [of article 31(2)] does not provide any indications enabling the precise point in time to be determined. In similar circumstances the European Court of Justice ruled in Article 21 of the European Court's constitutional charter that the point in time which counts would be decided by the lex fori of the court dealing with the case at issue; this principle is also to be followed for the CMR. If therefore, it is accepted before a German court that the same case is already pending at the Commercial Court in Zürich, the respective point in time of pendency, and therefore the chronological sequence, will consequently be determined in accordance with the law of civil procedure in Zürich and the German law of civil procedure. In so far as German law is applied, the point in time at which the statement of claim is submitted to the court will be instrumental, and not the date on which the statement of claim is delivered to the respondent as stated in § 261 of the (German) Code of Civil Procedure. The discrepancy in the German translation in that it does not include Rechts anhängigkeit as a requirement is deliberate and prevents the petitioner in a German court from losing the race."
[40]I do not share Dr Csoklich's view of this passage. It is true that Basedow expresses the opinion that the deliberate omission of the concept of Rechtsanhängigkeit from the German text "prevents the petitioner in the German court from losing the race". However, this is not because he was formulating an autonomous meaning for the word "pending" ("en instance") which German courts would adopt, but, on the contrary, because in his opinion, as in the case of the Brussels Convention, the courts would have to decide whether an action was pending or not by reference to national law (and in particular the lex fori). Therefore, in German courts the claimant would have an advantage because the word "anhängig" pointed in the direction of pendency upon mere filing. That is of no assistance to an English court which, by parity of reasoning, would have to apply English law (the lex fori) guided by the authentic English text. At most, Prof Basedow's view might permit the inference that an Austrian court, applying Austrian lex fori, would, by analogy with German law, also regard an Austrian action as pending upon filing. On the other hand, I can well imagine that the word anhängig was used in the German translation, in circumstances where different expressions are used in Germany and Austria (I am not sure what the position is in Switzerland), as the most neutral possible word, without the taking up of any deliberate position as to the correct construction of the authentic text of article 31(2).[41]As it is, despite the lack of Austrian (or apparently German or Swiss) decisions on the point, it so happens that in this very case the judge in the Viennese Commercial Court (Judge Kaiser) has indicated her understanding that "pending" is to be understood in the sense of Streitanhängigkeit rather than Gerichtsanhängigkeit . Thus on 15 June 1999 she wrote to the Austrian Ministry of Justice, stating (inter alia) that in Austria Anhängigkeit under article 31(2) is to be understood as Streitanhängigkeit (Für Österreich bedeutet diese Rechtsansicht, dass unter Anhängigkeit im Sinne des Art 31 Abs 2 Streitanhängigkeit zu verstehen ist.").[42]To revert to Zelger v. Salinitri : it will be recalled that there, in paragraph 12 of its judgment (cited above at para 31 of my judgment), the European Court of Justice expressed the view that in German law the concept of Anhängigkeit initiated by the filing of the action "plays a role as regards limitation periods and compliance with procedural time-limits but in no way determines the moment at which the action becomes pending…an action becomes pending once the document initiating the proceedings has been served on the defendant." Further light is thrown on this finding in the Opinion in that case of Advocate General Mancini (at 2410ff). He pointed out (at 2411) that the German text of article 21 of the Brussels Convention (also) makes use of the concept of Anhängigkeit (in fact the word "anhängig" is used to translate what in the English text is the word "brought", as in "Where proceedings involving the same cause of action and between the same parties are brought in the courts of different states…"). He continued – In the terminology of German legal writing on the law of procedure and of German case-law, that term designates pendency deriving from lodgment (and capable of producing certain effects, such as causing time to cease to run for the purposes of limitation periods Zivilprozeßordnung (Code of Civil Procedure) whereas pendency which derives from service and removes jurisdiction from a court later seised is defined as Rechtsanhängigkeit . The national court suggests that it can be deduced from the foregoing that Article 21 was intended to make priority dependent on the simple lodging of the document initiating the proceedings… "Let me say straight away that Article 21 cannot be interpreted as the national court proposes…Let us leave aside for the moment the obviously marginal argument derived from the German text of the Convention. A problem such as the one before the Court can only be resolved by(a) ascertaining what is meant by lis pendens in the context of Article 21, and(b) examining the six legal systems to see if they provide a uniform rule in this case, and, therefore, if a uniform rule of law can be found in Article 21."[43]The European Court did not follow the Opinion of Advocate General Mancini in his search for and discovery of a uniform rule, and it is not for that purpose that I cite this passage. It is clear, nevertheless, that despite the German text of the Convention (there an authentic text), Mr Mancini advised and the European Court thought that an action only becomes pending in Germany, in at any rate any meaningful sense for the purpose of the doctrine of lis pendens , after service. Moreover in saying this, the European Court was expressing a view as to German law, not as to the meaning of article 21, which it had not yet reached.[44]For these reasons, despite the evidence of Dr Csoklich and the writings of Basedow , and while I remain fully conscious that I am concerned with article 31(2) of CMR and not article 21 of the later Brussels Convention, I believe that I am entitled to find that both under German law and under Austrian law, but at the very least under Austrian law (see the letter of Judge Kaiser), an action is pending under article 31(2), for the purposes of the doctrine of lis pendens , only upon service of the initiating document. After all, the Austrian term Streitanhängig means lis pendens .[45]The question remains, however, what an English court, applying the English text of article 31(2), with such assistance as is appropriate from the French text, should hold is the meaning of "pending" ("en instance"). I have already cited Dresser v. Falcongate , a decision that, for the purposes of the Brussels Convention's article 21/22 test of "definitively pending", an action is pending in English law only from the date of service. Nevertheless, that decision recognised that the traditional view of English law had previously been that an action was pending once it was brought and brought once the writ was issued, and it was that traditional view that had been applied at first instance, in Kloeckner & Co AG v. Gatoil Overseas Inc [1990] 1 Lloyd's Rep 177 (Hirst J) and in Dresser v. Falcongate itself (Hobhouse J), even to articles 21/22: see at 515/519. Nevertheless, aided by the considerations that the test to be applied was "definitively" pending (at 519G), but also that "In determining the effect of national law for purposes of the [Brussels] Convention we must, I think, have regard to the international purpose which the Convention was made to achieve" (at 515A), Bingham LJ arrived at the conclusion, which I have already cited above, that a new rule was required to define the time when the English court is seised of proceedings.[46]The opinions of commentators are not of any particular assistance. There is nothing in Löwe's 1975 Commentary which comments on the issue (see para 246). Löwe's chapter in Theunis says nothing more than to raise the question whether the issue is to be decided under domestic or foreign law (at 152, para 22). Clarke is silent about the problem (at 188/9). Only Hill & Messent ventures a more positive comment (at para 10.38), pointing out that "The specific reference to "before a court or tribunal" must mean that at least some step in the action has been taken. The French text makes the position clearer, stating that the subsequent claim must be suspended when " une action est en instance devant une jurisdiction compétente ". In England, an action commences once the writ is issued, which must therefore be the earliest point at which an action could be considered to be pending. However, a similar question has arisen before the English courts in the context of the Brussels Convention. While not strictly directly relevant to CMR, the underlying considerations which underpin the current position of the English courts in that context would seem to have equal relevance to the proper interpretation of CMR."[47]It is now time for me to state my conclusions on the issue. In my judgment, "pending" in article 31(2) should be understood in a sense which does justice, in an international context, to the concept of lis pendens , and so understood it points to a view that English proceedings should not be regarded as pending until they are served. Whether that is to give "pending" an autonomous meaning, or to interpret the expression under English law for the purposes of an international convention, or both, I leave for others to decide. That is not, however, to say that it is for English law, or for an English court, to decide for a foreign court and for a foreign law whether it would adopt the same test. Austria might decide to give another meaning to article 31(2) and it is for Austrian law to determine when under its own law an Austrian action is "pending". Nevertheless, an English court which is asked to determine an application under article 31(2) to stay or dismiss an English action on the ground that a foreign action was already "pending" when the English action was "started", is entitled to determine the test, to find, with the aid of evidence about the foreign law in question, whether the foreign action has reached a state of pendency under its own law, and to determine whether that was before or after the English action was started or itself reached a state of pendency. I come to these conclusions for the following reasons.[48]First, as a matter of the language of article 31(2), there is a contrast between the concept of an action being pending before a court and the concept of an action being started in or brought before a court. Otherwise, I do not see why the same language should not have been adopted throughout, viz the language of starting or bringing an action: so that the article could have provided – "Where…an action has been started in [or brought in or before] a court…" The same distinction is found in the French text, where the contrast is between être intenté and être en instance . These do not appear to be French legal terms of art, but they are fairly translated by the concepts of being started and of being pending. Thus the Concise Oxford - Hachette French Dictionary gives the meanings of intenter as to bring (specifically in a legal setting, as in "intenter une action contre" ) and en instance as pending (as in "l'affaire est en instance" ); see also "être en instance de divorce" ("to be engaged in divorce proceedings " )).[49]Secondly, while recognising the argument of Mr Mildon that the very competition between an action which is pending in one jurisdiction and started in another might suggest that the concepts of "pending" and "started" should be harmonised rather than contrasted, I find that the sense of contrast prevails. If that means, where the pending action has priority but the second action has been started before such priority has been achieved, that the words "no new action shall be started" is to be understood to mean "no new action shall be started or continued", I would regard that as preferable to finding that the contrasted language is to be construed to mean the same thing. Alternatively, but in my view less satisfactorily, one would conclude that the second action which has been started before the pending action reaches priority simply escapes the bar which would have been achieved if the pending action had reached priority before the second action had even been started.[50]Thirdly, all the learning about the continental concept of lis pendens which has emerged from Zelger v. Salinitri is that it is the time of service rather than the time of the initiation of proceedings which is dominant, or at any rate that service is a necessary condition of pendency (see at paras 11/12 of the judgment and Dresser v. Falcongate at 522E). Given the desirability of finding an approach to the construction of article 31(2) which will fulfil its role in an international convention, and given also the reasoning of Dresser v. Falcongate in favour of a rule even in English law as to pendency as at the time of service (see especially at 523A/C), it is in my view preferable to adopt service as the time of pendency, while recognising, as does German and Austrian law and perhaps most continental jurisdictions, that the commencement of litigation is valid to mark limitation and perhaps other concepts. I recognise of course that Dresser v. Falcongate is addressing the concept of definitively pending in the differently worded Brussels Convention: but I do not regard the prospect of applying a different rule in English law to two international conventions, both of them essentially European conventions, as attractive. (This is despite the prospect that the situation may yet change again: amendments to the Brussels-Lugano Conventions are currently being negotiated and/or enacted whereby the concept of seisure there may revert, expressly, to the time of issue or rather the time of filing of the claim document with the court.)[51]Fourthly, I regard the evidence of Austrian law which is before the court as showing that an Austrian court would regard its own proceedings as "pending" for the purposes of article 31(2) only after service. It follows that both when the English proceedings were started and when they were served, the Austrian action had not yet become "pending" under Austrian law. In the meantime the English proceedings have been served and thus have on any view become pending for the purposes of article 31(2) in English law.[52]It follows that the application to bar, stay or dismiss the English proceedings must fail. In the circumstances, this appeal will be dismissed, irrespective of the answers to the third and fourth issues. It will be a matter for the Austrian court to determine what should happen to Leitner's proceedings in the Viennese Commercial Court: but whatever it makes of article 31(2) of CMR, it will also presumably be called upon to consider articles 21 and 22 of the Lugano Convention. In this court it is common ground between the parties that the Austrian court could not be regarded as the first seised under the Lugano Convention. Issue (iii): Is an action for a negative declaration such an action within article 31(2) as may bar a later action?[53]This is the issue which Colman J decided in Frans Maas with the answer "No", on the ground that only substantive claims leading to monetary judgments which could be enforced in the strict sense could bar a subsequent action. In that case the carrier had claimed a declaration of non-liability in proceedings in Utrecht. A year later, the cargo owner's assignee had made a substantive claim against the carrier in England. Colman J refused to dismiss the English action under article 31(2). However, he did stay it under articles 21 and 22 of the Brussels Convention.[54]Colman J reasoned as follows (at 183/4):
"Article 31.2 is designed to prevent multiplicity of proceedings in respect of the contract of carriage. "
A claim referred to in paragraph 1 of this article" clearly means any claim advanced "arising out of carriage under this convention" in par. 1, whether advanced by a goods owner or carrier. The words "an action is pending before a court or tribunal competent under (paragraph 1)" means that legal proceedings in which a claim of the kind described in par. 1 (arising out of carriage under CMR) is advanced are in progress before a court identified as an appropriate venue under par. 1. "Article 31.2 recognizes that, although an action may have been started in the appropriate venue, a judgment yet to be obtained or already obtained in the Court or tribunal in question may not be enforceable in another country which is also an appropriate venue. Clearly the judgment contemplated is one in respect of which enforcement proceedings would be applicable, namely a judgment for damages or other remedy properly the subject of such proceedings. That must be the correct construction because nobody would start new proceedings to achieve enforcement in a particular jurisdiction if all that they were after was a judgment for a negative declaration of which they sought recognition for defensive purposes as distinct from enforcement in that other jurisdiction. Consequently, in art. 31.2 the pending action or the judgment obtained, as the case may be, and the new action contemplated as being started in another jurisdiction must all involve claims for enforceable relief as distinct from a declaration of non-liability, which might be expected to be enforced . Moreover, the bringing of an action "on the same grounds" contemplates duplication of a claim so as to suggest that this paragraph is indeed aimed at protecting the nemo debit bis vexari principle and is not concerned with preventing defensive cross-claims. This construction is also supported by the contents of pars. 3 and 4 of art. 31 which strongly suggest that when the article refers to an enforceable judgment, it means one capable of being the subject of enforcement proceedings."[55]The option of staying Merzario's English action under the Brussels Convention in these proceedings is not open, since in this case the Austrian court is not the court "first seised" for the purposes of that Convention's articles 21/22. That is because the English proceedings were served first: see Dresser v. Falcongate .[56]Mr Mildon submits that on this issue Frans Maas was wrongly decided. He submits that the most obvious manifestation of the problem of parallel proceedings is the case where A seeks declaratory relief against B in one action and B seeks monetary relief against A in the other action, and that the authors of CMR must have wished to deal with such a case. He submits that it is well recognised that claims for negative declaratory relief have always been common on the continent: see para 23 of the Opinion of Advocate General Tesauro in The Tatry [1994] ECR I-5439 , [1999] QB 515 , where he said:
"It should also be borne in mind that the bringing of proceedings to obtain a negative finding, which is generally allowed under the various national procedural laws and is entirely legitimate in every respect, is an appropriate way of dealing with genuine needs on the part of the person who brings them. For example, he may have an interest, where the other party is temporizing, in securing a prompt judicial determination – if doubts exist or objections are raised – of the rights, obligations or responsibilities deriving from a given contractual relationship."
[57]In The Tatry the European Court of Justice held that for the purposes of article 21 of the Brussels Convention a claim for a declaration that the claimant is not liable under a contract had the same cause of action and the same object as a later action for damages under the same contract. Although at one stage English courts may have viewed claims for negative declarations with suspicion or even hostility, the modern approach is more open minded: see New Hampshire Insurance Co v. Phillips Electronics North America Corporation [1998] CLC 1062, Messier Dowty Ltd v. Sabena SA [2000] 1 Lloyd's Rep 428 .[58]Mr Mildon submitted, moreover, that Colman J's reason for finding a restrictive interpretation of the scope of article 31(2) in the concept of enforcement was not well founded. The proviso at the end of article 31(2) ("unless the judgment of the court or tribunal before which the first action was brought is not enforceable in the country in which the fresh proceedings are brought") was only inserted because it is open under article 31(1) to found jurisdiction in the courts of a non-contracting state, as a result of which the judgments of that court would not be automatically enforceable under the provision of article 31(3) that the judgments of the courts of all contracting states, when enforceable under the lex fori, "shall also become enforceable in each of the other contracting States". In such circumstances "enforceable" should be given a broad meaning to include the concept of recognition. In this connection Mr Mildon relied on Löwe's 1975 Commentary, where (at paras 248/254) he spoke in the same breath of enforcement and recognition, and (at para 246) referred specifically to an action for a negative declaration in the following passage:
"The action must be the same action, ie it must relate to the same claim but it is not necessary that in the fresh proceedings the same parties should appear as plaintiff and defendant respectively. Thus, where payment is required of the defendant in one State, the defendant cannot refer to the court or tribunal of another State for the purpose of having that court or tribunal establish that payment is not due to the plaintiff of the earlier proceedings."
[59]Mr Mildon also relied on that passage as throwing doubt on Colman J's second reason for confining the scope of article 31(2) to cases where the same monetary claim is made in the two jurisdictions (issue (iv) below). In this connection he wished to be able to rely on material, which he submitted could properly be consulted as travaux préparatoires , to show that whereas an earlier draft of article 31(2) would have supported Colman J's reasoning ("The plaintiff may choose between the courts available to him in accordance with paragraph 1 above; but he may not bring proceedings on the same grounds against the same party before more than one court"), the ultimate draft in contrast was plainly intended to have a wider scope.[60]Mr Bright on the other hand sought to support Colman J's reasoning by emphasising that the concept of enforcement found in both article 31(2) and article 31(3) is to be clearly contrasted to that of recognition. Thus he referred to section 4 of the Carriage of Goods by Road Act 1965, which provides that any judgment in any action pursuant to article 31(1) of a court within any of the other contracting states can be registered and enforced in accordance with Part I of the Foreign Judgment (Reciprocal Enforcement) Act 1933 (the "1933 Act"). In that connection Mr Bright points out, correctly, that only monetary judgments can be registered and enforced under Part I of the 1933 Act – see section 1(2)(b) which speaks of a "a sum of money, not being a sum payable in respect of taxes or other charges of a like nature or in respect of a fine or other penalty". He also sought to support his submission by reference to the well recognised distinction between enforcement and recognition, exemplified for instance in the treatment of those concepts in Dicey & Morris, The Conflict of Laws , 13 th ed, 2000, at chapter 14, and in the Brussels Convention at articles 26/30 (headed "Recognition") and 31/45 (headed "Enforcement"). Mr Bright went on to submit that the limited scope of article 31(2) was of no great concern, despite what he too recognised was the widespread continental use of actions for negative declarations, because of traditional means of giving effect to foreign judgments, and the lis pendens provisions of the Brussels-Lugano Conventions.[61]As for Mr Mildon's travaux préparatoires , Mr Bright submitted that they did not fall within the necessary conditions laid down in Fothergill v. Monarch Airlines . In that submission he appears to have the support of Hill & Messent (see at para 21 above). At most this material could be said to show that article 31(2) was intended to have a wider scope than duplication of claims. It does not, in my judgment, otherwise point to a definite legislative intention on the disputed issue.[62]As to that issue, I do not think it is easily resolved. Apart from Löwe's Commentary, there is no assistance in the text-books. For myself I would express the considerations as follows. First, I do not think that article 31(2) is limited to duplication of claims. Quite apart from the factor that in my view the qualification "on the same grounds" does not exclude the case of a negative declaration which mirrors a substantive claim (see under issue (iv) below), it seems to me that it would be unrealistic to think that the example given by Löwe in his Commentary, of a substantive claim in one jurisdiction followed by a claim for a negative declaration in another jurisdiction, should not be within the scope of a lis pendens provision such as article 31(2). This may be especially the case given the ready acknowledgment of the utility of the negative declaration in continental jurisprudence. I do not take account of the legislative history relied on by Mr Mildon, but certainly if account were taken of it, the intention to proceed beyond the duplication of claims would be indicated.[63]Secondly, however, it seems to me that the language of enforceability which pervades article 31(2) and (3) is not easily put aside. It is a fair point that enforcement and recognition are different concepts. The French text uses the language of "susceptible d'être exécutée" (article 31(2)) and "exécutée" (article 31(3) and (4)), which similarly reflects the language of enforcement ( exécution ) as distinct from recognition ( reconnaissance ) – see Titre III of the Nouveau Code de Procédure Civile. The language in article 31(3) – "as soon as the formalities required in the country concerned have been required with" – appears to point to enforcement in the strict sense. The reference to a judgment for costs against a plaintiff who fails in his action (in article 31(4)) is again a reference to enforcement in its strict sense. It also seems to be the case that the English draftsman of the 1965 Act thought that enforcement referred to the strict enforcement of a money judgment dealt with by Part I of the 1933 Act. That cannot affect the meaning of the convention wording, but it gives one pause. So what is the basis upon which "enforceable" wherever it appears is to be given the meaning of "enforceable or recognisable"? Of course, if one begins with the premise that article 31(2) is designed to give primacy to a claim for a negative declaration which is "pending" before a second claim is started, then it becomes necessary to give the word "enforceable" an extended meaning. But is that premise a justifiable assumption? It seems to me that it may not be, and if it is not, the assumption on which the need to extend the meaning of "enforceable" goes. The fact that negative declarations are a common feature of continental jurisprudence, and the further fact that, in the example given by Löwe in his Commentary, a second action for a negative declaration will be barred by a pending action for a substantive claim, do not mean that the reverse situation is necessarily intended to be covered. If it had been, it would have been more to the point for Löwe to have given the example of an action for monetary relief which is started after an action for a negative declaration has become pending. But he did not.[64]Thirdly, I therefore ask myself whether it may make sense as a matter of construction and of principle for a pending action for a negative declaration to be denied a barring effect on a subsequent action for a substantive claim. If so, the word "enforceable" can be given its proper effect. As for construction, the points made above suggest that "enforceable" should be given its proper meaning. I shall consider other points below. As for principle, there seems little reason why in the context of CMR a claim for a negative declaration should be given any primacy. Most claims will be by a goods owner against a carrier for loss or damage arising out of the carriage –or by one carrier against another for an indemnity as in this case. Claims by a carrier will be more or less confined to claims for freight. However, a claim for freight cannot be a claim "on the same grounds" as a counter-claim for loss or damage arising out of the carriage, for there is no set off against freight: see R H & D International Ltd v. IAS Animal Air Services Ltd [1984] 1 WLR 573, applying Aries Tanker Corporation v. Total Transport Ltd [1977] 1 WLR 185. It is I suppose possible that a different rule applies in other jurisdictions, although there is no evidence to that effect: but even if I assume that is so, I do not think that a claim for freight and a claim for damage to goods are "on the same grounds" (see further below under issue (iv)), and I note that Löwe in para 246 of his Commentary says that the actions "must relate to the same claim". The question then arises, what is the virtue of giving an action for a negative declaration, if commenced first and pending, a primacy over another action raising the same issue, but in positive form as a claim for monetary relief? It must be remembered that the periods of limitation under CMR are strict. They are dealt with in article 32.[65]Save in the case of "wilful misconduct" in which case the time limit is extended to three years, there is a one year time limit for everything (article 32(1)). There are complex provisions, however, as to the date from which the one year commences to run. A written claim will suspend the period of limitation until such date as the carrier rejects the claim by notification in writing and returns the documents of claim (article 32(2)). Then in article 32(4) there is the important provision – "A right of action which has become barred by lapse of time may not be exercised by way of counter-claim or set off."[66]Such a provision is closely connected with the concept of parallel proceedings and lis pendens , because, where there are cross-claims which fall within the qualification "between the same parties on the same grounds", what one party raises in one action in one jurisdiction and the other party raises in another action in another jurisdiction will have to be put into a single action in a single jurisdiction if the second action is to be barred by the pendency of the first. What then is to happen if the carrier begins an action for a negative declaration close to the end of the period of limitation and the goods owner similarly begins his action for a claim for loss or damage to his goods close to the end of the limitation period, and the action for a negative declaration achieves priority (whatever the test of that may be). The goods owner's action will be barred, and his claim has to be canalised into the action of the carrier in the form of a counter-claim. That is the purpose of article 31(2), to canalise all actions "between the same parties on the same grounds" into one action, that with priority. However, by the time that the goods owner discovers that his action, which he commenced in time, is barred by the carrier's action, it is too late for him to counter-claim in the carrier's action. That would be a disgrace. How is such an unjust result to be avoided?[67]One possibility could be that the court which is required to bar or stay the second action, does so on terms that the counter-claim should be treated as being in time in the jurisdiction of the first action. Such a discretion is often exercised in English law, as part of the doctrine of forum non conveniens: see The Spiliada [1987] AC 460 and Baghlaf Al Safer Factory Co BR for Industry Ltd v. Pakistan National Shipping Co [1998] CLC 716. The difficulty with that approach, however, is that(a) the requirement of article 31(2)'s "no new action shall be started" does not appear to allow for that discretion;(b) whereas article 32(3) appears to contemplate that the question of an extension of the period of limitation shall be governed by "the law of the court or tribunal seised of the case", that would appear to be a reference to the court in which the action with priority will continue, rather than a reference to the court which is required to bar or stay the second action; and(c) even the court in which the action with priority will continue appears to be barred by article 32(4) from extending time in order to allow a right of action which has become time barred to be raised by way of counter-claim or even set-off. That is confirmed, as a matter of English law, by Impex Transport Aktieselskabet v. A G Thames Holdings Ltd [1981] 2 Lloyd's Rep 566. There Robert Goff J held that the normal English rule whereby a counter-claim is deemed to have been brought at the time of the issue of the original proceedings was ousted by article 32(4).[68]These considerations suggest to my mind that this court should be cautious before holding for the purposes of article 31(2) that a pending action for a negative declaration can bar a subsequent action for substantive relief. It is perhaps not impossible that some solution could be found to the limitation difficulties I have drawn attention to. But if one asks what is the importance of permitting such a bar, the most that can be said is that an action for a negative declaration is a well recognised form of action with the potential virtue of which Advocate General Tesauro spoke in The Tatry . But he said nothing more than that such an action was an "appropriate way of dealing with genuine needs…an interest, where the other party is temporizing, in securing a prompt judicial determination…" Where, however, time limits are short, as under CMR, it may be doubted whether the example of the carrier anxious to bring the goods owner to court, in the absence of a claim from that goods owner, should elicit much interest or sympathy. Much more likely, such a carrier is simply forum shopping. I do not think that the draftsmen of CMR had such a case in mind when they drafted article 31(2). The fact that Löwe spoke rather of the substantive action followed by the action for a negative declaration sufficiently demonstrates, in my view, what the draftsmen did have in mind. And the fact that this case is, apart from Frans Maas , the first time that this problem appears to have arisen in the context of CMR, and the fact that no other case from any foreign jurisdiction has been cited on the scope of article 31(2), all suggest that the action for a negative declaration has not been a vital tool to litigation under CMR, and that there will be no great loss to future litigants if such an action cannot by reason of that article gain priority over an action for substantive relief. Such a conclusion has the merit of being consistent with giving to the concept of enforcement its proper, but no more than its proper, scope.[69]For these reasons I would for my part be inclined to uphold the conclusion of Colman J in Frans Maas , but on the grounds of the partly different reasoning contained in this judgment. Thus I do not think that a second action for a negative declaration can be permitted to proceed in the face of a pending action for substantive relief between the same parties on the same grounds. However, not all of my reasoning was fully explored in argument in this court. I did raise the difficulty under article 32(4) in outline during the hearing, but there was little discussion of it. Therefore, because this appeal can be decided on issue (ii) alone, I would prefer to say that this part of my judgment reflects my opinion rather than my decision. Issue (iv): Were the Austrian and English actions in any event "on the same grounds"?[70]Colman J held that they were not, but, in my judgment, where an action for a declaration of non-liability and an action for damages for breach arise out of the same contract and raise a mirror-image of the same claim, both actions may properly be said to be on the same grounds. The French translation of "on the same grounds" is "pour la même cause". In article 21 of the Brussels Convention the English text speaks of "the same cause of action" and the French text speaks of "le même objet et la même cause". In Gubisch Maschinenfabrick KG v. Guilio Palumbo (Case 144/86) [1987] ECR 4861 the European Court of Justice (at para 14) referred to objet as standing for "subject-matter" and cause as standing for "cause of action". In The Maciej Rataj (Case C-406/92) [1994] ECR I-5439 , [1995] 1 Lloyd's Rep 302 , the European Court of Justice further defined cause as comprising "the facts and the rule of law relied on as the basis of the action" (at para 39). In Haji-Ioannou v. Frangos [1999] 2 Lloyd's Rep 337 at 351 the English court of appeal confirmed that "actions have the same cause if they have the same facts and rule of law as their basis". Although these are all cases on the Brussels Convention, it seems to me that the definition of cause , whether as "cause of action" or as "the facts and the rule of law relied on as the basis of the action", is entirely suitable for the English words of article 31(2) – "the same grounds". I note that Löwe in Theunis at 152 and Hill & Messent at para 10.39 both suggest that "the same grounds" only refers to the same facts, but even if that were so, it would catch the mirror-image case of the action for a declaration of non-liability and the action for substantive relief for breach; and for myself I do not see why, whether as a matter of the English ("the same grounds") or as a matter of the French ("la même cause"), the view of the European Court of Justice cannot be applied satisfactorily to article 31(2). Thus The Maciej Rataj was itself a case of such a mirror-image and the European Court of Justice found the requirements of article 21 fulfilled. So also in Haji-Ioannou v. Frangos , where the same plaintiffs brought proceedings on the same agreement and factual basis in Greece and England, Sir Thomas Bingham MR said (at 351) – "…Although in England the plaintiffs are asserting that the same underlying agreement gave rise to different legal consequences from which different obligations and, therefore, different legal remedies flowed, the cause would appear to be the same in both countries."[71]For these reasons, I would conclude, in respectful disagreement with Colman J in Frans Maas , that the Austrian and English proceedings were brought "on the same grounds". Conclusion[72]In conclusion, in my judgment this appeal should be dismissed. There is no longer any objection to CMR jurisdiction being properly founded in England (issue (i)). The concept of "pending" in article 31(2) under English law requires service of the proceedings, and on the evidence that is also the position under Austrian law: thus the Austrian action had not become pending under Austrian law before the English action had been served and so became, in my view, pending under English law. Issue (ii) is therefore to be resolved in favour of Merzario. In the circumstances, issues (iii) and (iv) are not decisive. I would, however, resolve issue (iv) in favour of Leitner on the basis that both actions were on the same grounds. And I would be inclined, without deciding, to resolve issue (iii) in favour of Merzario, on the basis that it was not intended that an action for a negative declaration should have priority under article 31(2) on becoming pending: because it cannot be enforced and would lead to limitation difficulties in connection with the canalisation of substantive claims.

LORD JUSTICE CHADWICK:

[73]Although this is an appeal against an order made on 30 June 2000 by Mr Justice Longmore, the only issue which the judge was asked to decide – whether Article 31(1)(b) of the Convention on the Contract for the International Carriage of Goods by Road ("the CMR Convention") permits a claimant to bring an action in the courts of England and Wales in circumstances where the goods were taken over by the carrier in Scotland – is no longer in dispute. The judge held that the relevant "country" for the purposes of the qualifying condition in Article 31(1): " . . . a country within whose territory . . . (b) the place where the goods were taken over by the carrier . . . is situated, . . ." was the United Kingdom, that being the 'contracting country' party to the Convention; and that, the courts of England and Wales being courts of the United Kingdom, there was no bar under Article 31(1) to proceedings in these courts. The defendant's challenge to the judge's decision on that issue, although raised by its appellant's notice, was not pursued in this Court.[74]The basis upon which the appeal was pursued in this Court – that these proceedings are barred by Article 31(2) of the Convention - was not the subject of argument before the judge. That that point was not argued before the judge is understandable in the circumstances that Mr Justice Colman had decided, in Frans Maas Logistics (UK) Ltd v CDR Trucking BV [1999] 2 Lloyd's Rep 179, that Article 31(2) did not apply so as to bar a new action in a case where the claim in the action pending was a claim for a declaration of non-liability. The action pending on which the defendant relied – an action which it had brought against the claimant in the Austrian courts - was to obtain a declaration of non-liability. As Mr Justice Longmore observed, it was recognised that he was unlikely to depart from the position established by the decision of Mr Justice Colman on that point in circumstances in which (as he put it) "it is obviously of paramount importance that the Commercial Court speaks with one voice" on the interpretation of the Convention. But it is accepted that, before the judge, the application of Article 31(2) was properly reserved for consideration by this Court on an appeal. Article 31(2)[75]The CMR Convention, signed at Geneva on 19 May 1956, was given the force of law in the United Kingdom by section 1 of the Carriage of Goods by Road Act 1965. The provisions of the Convention are set out in the schedule to that Act. Article 31(2) of the Convention is in these terms:
"Where in respect of a claim referred to in paragraph 1 of this article an action is pending before a court or tribunal competent under that paragraph, or where in respect of such a claim a judgment has been entered by such a court no new action shall be started between the same parties on the same grounds unless the judgment of the court or tribunal before which the fresh action was brought is not enforceable in the country in which the fresh proceedings are brought."
[76]In that context 'a claim referred to in paragraph 1 of this article' means a claim in 'legal proceedings arising under this Convention' – see the opening words of Article 31(1). It is common ground that the proceedings commenced by the appellant in the Austrian courts are proceedings arising under the Convention. It is common ground, also, that the Austrian courts are competent to entertain those proceedings under Article 31(1). That that is so follows from the fact that the place designated for delivery of the goods under the contract of carriage was Vienna; so that the alternative qualifying condition under article 31(1)(b) is satisfied. The matters in dispute, as Lord Justice Rix has pointed out, are(a) whether, in the events which had happened, the proceedings in the Austrian courts were 'pending' at the time when the current proceedings were started in London,(b) whether, in any event, the Austrian proceedings – in which (as I have said) the claim is for a declaration of non-liability – are capable of barring a fresh action between the same parties for substantive relief, and(c) if so, whether, in any event, the action in London has been started 'on the same grounds' as those on which the Austrian proceedings are founded. Were the Austrian proceedings pending?[77]I can address the first of those matters shortly. For the reasons given by Lord Justice Rix, with whose judgment on this point I am in respectful agreement, I am satisfied that, at the time when the action in London was started, there was no action pending in the Austrian courts within the meaning of Article 31(2) of the Convention. That is because the Austrian proceedings were not served on the respondent, Merzario, until 22 December 1999; that is to say, were not served until after the claim form in the English action had been issued (on 15 October 1999) and served on the appellant, Leitner, (on 21 October 1999).[78]The dates of issue and service of the English action are such that it is unnecessary, in this case, to decide what the position would have been if the Austrian proceedings had been served after issue, but before service, of proceedings in the English action. For my part, I prefer the view (which has, I think, attracted Lord Justice Rix also) that the language of Article 31(2) – in both the English and the French versions of the text – point to an intent that 'started' is not to be treated as synonymous with 'pending'. So the prohibition in Article 31(2) is against starting a new action (in the sense of commencing proceedings by some curial act – for example the issue of a claim form) while some other action is pending (in the sense in which that word has come to be understood in Community law in the context of article 22 of the Brussels Convention – that is to say, in the sense 'definitively pending' adopted by the Court of Justice in Seigfried Zelger v Sebastiano Salinitri (Case 129/83) [1984] ECR 2397 and explained by the Court of Appeal in Dresser UK Ltd and others v Falcongate Freight Management Ltd [1992] 1 QB 502.[79]I appreciate that that leaves open for decision, in a case in which the question does arise, whether a court before whom an action has been started but is not pending (in the sense in which I think those words should be understood in this context) at the time when some other action becomes a pending action (by service on, or notice to, the defendant) is obliged to, or has power to, stay the action which is before it. As Lord Justice Rix has observed, it seems likely that the Austrian court will need to address that question in relation to the Austrian proceedings. For my part, I doubt whether the answer is to be found in Article 31(2) of the CMR Convention. If the Austrian proceedings were pending when the English action was started would Article 31(2) have any application?[80]This is the point which Mr Justice Colman decided in the Frans Maas case. It may be said that the conclusion, already reached in the present case, that the Austrian proceedings were not pending when the English action was started, makes it unnecessary to decide whether Mr Justice Colman was right. But the point is of obvious general importance; it has been fully argued before this Court; and, in my view, it is appropriate that this Court should reach a determination upon it. It would not, I think, be satisfactory – or in the interests of those who use the Commercial Court - if this Court were to leave the point undecided.[81]The defendant in the Frans Maas case, CDR Trucking BV ("CDR"), was the carrier under a contract for the carriage of computer parts by road from Aston-under-Lyme to Montfoort in the Netherlands. The goods were for delivery to Sun Micro Systems International BV ("SMSI"). The goods were lost, believed stolen, after they had reached the Netherlands but before delivery. CDR commenced proceedings before the District Court of Utrecht, to which SMSI and others were defendants, for a declaration that it was not liable for the loss of the goods (alternatively, that it was entitled to limit its liability under the CMR Convention). A year or so after those proceedings had been served on SMSI, SMSI assigned its rights of action under the contract of carriage to Frans Maas Logistics (UK) Ltd ("FML"). FML commenced proceedings against CDR in the Commercial Court in London, claiming damages for non-performance of the contract. CDR sought an order dismissing those proceedings on the grounds that pursuit of the claim in the English court was contrary to Article 31(2) of the CMR Convention. In the alternative, CDR sought a stay of the proceedings pursuant to Articles 21 and/or 22 of the Brussels Convention.[82]It was accepted that the English action was 'between the same parties and on the same grounds' as the action pending before the court in Utrecht – see [1999] 2 Lloyd's Rep 179, at page 181. The judge held, contrary to the submissions advanced on behalf of FML, that the court in Utrecht was 'competent', under Article 31(1) of the CMR Convention, in respect of the claim for a declaration of non-liability –see page 181, where he described that as "the key issue", and at page 184, where he said this:
". . . given that proceedings for a negative declaration are normal in continental jurisdictions, one would not expect to find them excluded from a provision written in general terms, such as art. 31.1. Words expressly excluding such proceedings could be expected to be used if that was the intention of the parties to the Convention."
[83]Given that the English action was between the same parties and on the same grounds as the action in the Netherlands, and that proceedings in the Netherlands were in respect of a claim referred to in Article 31(1), it is difficult to see, at first sight, how Mr Justice Colman reached the conclusion (as he did) that Article 31.2 had no application. But, on analysis, it can be seen that he was led to that conclusion, principally if not exclusively, by the proviso (or final limb) to Article 31.2:
". . . unless the judgment of the court or tribunal before which the first action was brought is not enforceable in the country in which the fresh proceedings are brought."
[84]The reasoning which led Mr Justice Colman to the conclusion which he reached is contained in the paragraph of his judgment (at page 184) to which Lord Justice Rix has already referred. For convenience, I set it out again in this judgment:
"Article 31.2 recognizes that, although an action may have been started in an appropriate venue, a judgment yet to be obtained or already obtained in the Court or tribunal in question may not be enforceable in another country which is also an appropriate venue. Clearly the judgment contemplated is one in respect of which enforcement proceedings would be applicable, namely a judgment for damages or other remedy properly the subject of such proceedings. That must be the correct construction because nobody would start new proceedings to achieve enforcement in a particular jurisdiction if all that they were after was a judgment for a negative declaration of which they sought recognition for defensive purposes as distinct from enforcement in that other jurisdiction. Consequently, in art 31.2 the pending action or the judgment obtained, as the case may be, and the new action contemplated as being started in another jurisdiction must all involve claims for enforceable relief as distinct from a declaration of non-liability, which might be expected to be recognized in such other jurisdiction, but certainly would not be expected to be enforced . Moreover, the bringing of an action "on the same grounds" contemplates duplication of a claim so as to suggest that this paragraph is indeed aimed at protecting the nemo debit bis vexari principle and is not concerned with preventing defensive cross-claims. This construction is also supported by the contents of pars. 3 and 4 of art.31 which strongly suggest that when the article refers to an enforceable judgment, it means one capable of being the subject of enforcement proceedings."
[85]I do not find that reasoning persuasive. First, I see no force in the point made in the penultimate sentence: that the requirement (in Article 31(2)) that the fresh action be brought 'on the same grounds' suggests that the article is not concerned with preventing defensive cross-claims. It is pertinent to recall that it was common ground in the Frans Maas case that the defensive claim in the Netherlands and the claim for damages in London were brought 'on the same grounds' –see the passage at [1999] 2 Lloyd's Rep 179, 181, to which I have already referred. Further, for the reasons given by Lord Justice Rix, when reaching the conclusion that the two claims were, indeed, brought on the same grounds (under the issue which he has identified as "issue (iv)"), it seems to me plain that that common ground represented a proper appreciation of the position. The principle that a party to a dispute should not be vexed by the duplication of litigation has as much relevance where the one claim is the reciprocal (or mirror-image, as Lord Justice Rix has described it) of the other as it does where the two claims are brought in the same interest. If one party, say A, brings an action against another, say B, for a declaration that a given set of facts gives rise to no liability by A to B, and succeeds, A is as entitled to expect that he will not be subjected to a claim by B based on those facts in a second action as he would be if he had been defendant in a first action in which B had failed to establish that A was liable on those facts. I can see no basis for Mr Justice Colman's conclusion that the requirement, in Article 31(2), that the fresh action be 'on the same grounds' suggests that the article is not concerned with preventing defensive cross-claims. In any event, the relevant question is whether Article 31(2) is concerned to prevent a fresh claim for damages in circumstances where the defensive cross-claim has already been raised in existing proceedings.[86]Nor do I think that support for Mr Justice Colman's conclusion can be found in Articles 31(3) and 31(4). Those articles are in these terms:
"(3) When a judgment entered by a court or tribunal of a contracting country in any such action as is referred to in paragraph (1) of this article has become enforceable in that country, it shall also become enforceable in each of the other contracting states, as soon as the formalities required in the country concerned have been complied with. The formalities shall not permit the merits of the case to be re-opened. (4) The provisions of paragraph 3 of this article shall apply to judgments after trial, judgments by default and settlements confirmed by order of the court, but shall not apply to interim judgments or to awards of damages, in addition to costs against a plaintiff who wholly or partly fails in his action."
[87]Effect was given to Article 31(3) of the Convention by section 4(1) of the Carriage of Goods by Road Act 1965. The section is in these terms, so far as material:
". . . Part I of the Foreign Judgments (Reciprocal Enforcement) Act 1933 . . . shall apply, whether or not it would otherwise have so applied, to any judgment which: (a) has been given in any such action as is referred to in [Article 31(1) of the Convention], and (b) has been so given by any court or tribunal of a territory in respect of which one of the High Contracting Parties, other than the United Kingdom, is a party to the Convention, and (c) has become enforceable in that territory."
It is relevant to have in mind, in that context, that Mr Justice Colman held that 'any such action as is referred to in [Article 31(1)]' included proceedings for a negative declaration – which, as he recognised, are 'normal in continental jurisdictions'.[88]Part I of the 1933 Act provides for the registration in the High Court of the judgments of foreign courts. When registered the foreign judgment shall, for the purposes of execution, be of the same force and effect as if the judgment had originally been given by the registering court – see section 2(2) of the Act. Section 1(2)(b) provides that a judgment of a superior court of a foreign country to which Part I of the Act extends shall be a judgment to which Part I applies if there is payable thereunder a sum of money (not being a sum payable in respect of taxes, or a fine or other penalty). Section 8(1), in Part II of the Act, is in these terms:
"Subject to the provisions of this section, a judgment to which Part I of this Act applies or would have applied if a sum of money had been payable thereunder, whether it can be registered or not, shall be recognised in any court in the United Kingdom as conclusive between the parties thereto in all proceedings founded on the same cause of action and may be relied on by way of defence or counterclaim in any such proceedings."
[89]It follows, as it seems to me,(i) that (subject to the question whether a declaration of non-liability can be regarded as 'enforceable' in the country in whose courts it has been made) a judgment given by a court or tribunal of a country which is party to the Convention in proceedings to which Article 31(1) applies can be registered under Part I of the 1933 Act – because judgments given in actions within Article 31(1) are judgments to which Part I of the Act applies, whether or not it would otherwise have applied (see section 4(1) of the 1965 Act), so that it is immaterial that the requirement that it be a money judgment (imposed by section 1(2)(b) of the 1933 Act) is not satisfied; and,(ii) that, whether or not registered, or registrable, such a judgment will be recognised in any court in the United Kingdom as conclusive as between the parties – because it is a judgment to which Part I applies or would have applied if a sum of money had been payable thereunder (see section 8(1) of the 1933 Act). The only relevant question, as it seems to me, is whether a declaration of non-liability can be regarded as 'enforceable' in the country in whose courts it has been made. I do not think that the provisions in articles 31(3) and 31(4) assist in deciding that question.[90]Mr Justice Colman was impressed by the fact that, as he put it in the opening sentence of the passage of his judgement already cited:
"Article 31.2 recognizes that, although an action may have been started in the appropriate venue, a judgment not yet obtained or already obtained in the Court or tribunal in question may not be enforceable in another country which is also an appropriate venue."
That recognition is found in the proviso or final limb to Article 31(2):
". . . unless the judgment of the court or tribunal before which the first action was brought is not enforceable in the country in which the fresh proceedings are brought."
[91]The reason why that proviso is needed is, I think, obvious. Article 31(1) does not prevent a claimant from bringing proceedings arising out of carriage under the Convention in the courts of a country which is not a contracting country. Article 1(1) provides that the Convention shall apply to every contract for the carriage of goods by road in vehicles for reward, "when the place of taking over of the goods and the place designated for delivery, as specified in the contract, are situated in two different countries, of which at least one is a Contracting country, irrespective of the place of residence and the nationality of the parties ." [emphasis added]. Article 31(1)(a) allows proceedings arising out of carriage under the Convention to be brought in a country within whose territory the defendant is ordinarily resident, or has his principal place of business. There is no reason why a country in respect of which those conditions are satisfied should be a contracting country. Article 31(1)(b) allows proceedings to be brought in a country within whose territory the place where the goods were taken over, or the place designated for delivery, is situated. One or other of the place where the goods were taken over or the place for delivery will be in a contracting country – for otherwise the contract will not be for carriage under the Convention (see Article 1(1)) – but there is no reason why both should be. Plainly, there will be cases where legal proceedings arising out of carriage under the Convention have been brought in a court which is competent under Article 31(1) but where that is the court of a country which is not a contracting country for the purposes of the Convention. In such a case the judgment of that court (whether or not enforceable in the country in which it is given) will not, by virtue of Article 31(3), be enforceable in the courts of the contracting States. That is because Article 31(3) applies only where the judgment in question is the judgment of a court of a contracting country. There may be some other reason why the judgment of the court of a non-contracting country, say country X, is enforceable in the country in which it is sought to bring a fresh action, say country Y; for example country X and country Y may be party to some other convention for the mutual recognition and enforcement of judgments, or may be party to a bi-lateral treaty such as is contemplated by the 1933 Act. But there will be cases where the judgment of the court in country X (although enforceable in country X) will not be enforceable in country Y.[92]In this context it is important to keep in mind that Article 31(2) applies whether or not country X is a contracting country – provided that the court of country X is a competent court for the purposes of Article 31(1) – but does not apply unless country Y is a contracting country. The Convention does not seek to prevent – and could not, in practice, prevent – the start of a new action in a country which is not a contracting country. The object of Article 31(2) is to prevent the start of a new action – and so avoid duplication of proceedings – in a contracting country, country Y, in case where the judgment in the existing action in country X will be enforceable in country Y. It is no part of the object of Article 31(2) to prevent the start of a new action in country Y where the judgment in country X will not be enforceable in country Y. That is the reason for the proviso. In such a case relief cannot be obtained in country Y without a new action there.[93]It must be appreciated, also, that there are four possible categories of case to be considered in relation to Article 31(2).(1) A begins an action against B in country X for substantive relief; and then seeks to start a new action against B in country Y for the same relief.(2) A begins an action against B in country X for substantive relief; and B then seeks to start an action against A in country Y for a declaration of non-liability.(3) A begins an action against B in country X for a declaration of non-liability; and B then seeks to start an action against A in country Y for substantive relief.(4) A begins an action against B in country X for a declaration of non-liability; and then seeks to start a new action against B in country Y for the same relief. Article 31(2) will have no application in any of those cases unless country Y is a contracting country. Nor will it have any application in any of those cases unless the judgment in country X is or will be 'enforceable' in country Y. That latter condition will be satisfied if country X is also a contracting country – see Article 31(3) – and may be satisfied in other cases. Let it be assumed that both country X and country Y are contracting countries. If Mr Justice Colman's reasoning were correct, the only cases in which Article 31(2) would achieve the objective for which it was plainly included – that of avoiding duplication of litigation – would be those within category (1). That follows from the sentence in his judgment, already cited, that:
" Consequently, in art 31.2 the pending action or the judgment obtained, as the case may be, and the new action contemplated as being started in another jurisdiction must all involve claims for enforceable relief as distinct from a declaration of non-liability, which might be expected to be recognized in such other jurisdiction, but certainly would not be expected to be enforced ."
It is only where the case falls within category (1) that both the pending action (in country X) and the new action (to be started in country Y) satisfy the requirement that "all [must] involve claims for enforceable relief as distinct from a declaration of non-liability".[94]I find it impossible to accept that Article 31(2) was intended to have such a limited effect. I can see no sensible reason, for example, why those who negotiated the Convention should have wished to include cases within category(1) within, but exclude cases within category(2) from, the obvious purpose of Article 31(2) – the avoidance of double litigation. Nor, if category (2) cases are included, can there be any sensible reason for excluding category(3) cases. The only sensible meaning that can be given to the word 'enforceable' in the context of Article 31(2) is 'capable of being given effect'.[95]It follows that I am satisfied that the decision in the Frans Maas case on this point cannot be upheld on the basis of Mr Justice Colman's reasoning.[96]Lord Justice Rix has expressed the provisional view that the conclusion reached by Mr Justice Colman in the Frans Maas case may be capable of being supported on other grounds. I am very conscious that his experience in relation to claims brought under the CMR Convention is much more extensive than my own; but, after considering his judgment (which I have had the advantage of reading in draft form) I remain unconvinced that there is any good reason for restricting the application of Article 31(2) to cases where the claims in both the pending action and the proposed new action are claims for substantive relief. If, as appears to be recognised on all sides, claims for declarations of non-liability are common in continental jurisdictions, it seems to me that Article 31(2) must have been intended to include them. Was the English action started 'on the same grounds'?[97]In my view, the third issue is subsumed in the second. For the reasons to which I have already referred I have no doubt that the English action was started on the same grounds as the action in Austria. Conclusion[98]I would dismiss this appeal on the ground that, although Article 31(2) is capable of applying in a case where the first action is for a declaration of non-liability, it does not apply in the present case because, on the facts, the first action was not 'pending' at the time when the second action was started. THE VICE-CHANCELLOR:[99]The facts giving rise to this appeal have been fully described by Rix LJ. I gratefully adopt his account of them. He has also analysed (paragraph 13 above) the three remaining, issues (ii) to (iv), which arise for our determination. Each of them depends on the proper construction and application of Article 31(2) of the Convention on the Contract for the International Carriage of Goods by Road ("CMR") to which the force of law in the United Kingdom was given by Carriage of Goods by Road Act 1965.[100]Article 31(2) provides "Where in respect of a claim referred to in paragraph 1 of this article an action is pending before a court or tribunal competent under that paragraph, or where in respect of such a claim a judgment has been entered by such a court or tribunal no new action shall be started between the same parties on the same grounds unless the judgment of the court or tribunal before which the first action was brought is not enforceable in the country in which the fresh proceedings are brought."[101]The first issue is whether the Austrian action was pending at the time when the English action was started. Rix and Chadwick LJJ consider that it was not. I agree with them and have nothing to add.[102]I find it convenient at this stage to refer next to issue (iv), namely, whether the Austrian and English actions were brought "on the same grounds". Rix and Chadwick LJJ agree that they were. Again I agree with them and have nothing to add.[103]The remaining issue (iii) is whether the Austrian action, being a claim for a negative declaration alone, is such an action as would, if it had been pending, have barred the English action, being a further action between the same parties and on the same grounds. This issue involves a consideration of whether the decision of Colman J in Frans Maas Logistics (UK) Ltd v CDR Trucking BV [1992] 2 Ll.R. 179 to the effect that such an action was not such a bar was correct.[104]As Rix and Chadwick LJJ have pointed out this issue cannot be determinative of the appeal, given that it must be dismissed anyway because of our conclusion on issue (ii). In view of the argument presented to us Rix and Chadwick LJJ have expressed their views on this issue as well. But they reach opposite conclusions. In those circumstances it is incumbent on me to reach a conclusion on this issue notwithstanding that our decision, whatever it may be, will not be binding. I can do so quite shortly as the rival arguments have been comprehensively explored by the other members of the court.[105]The difference between Rix LJ and Chadwick LJ arises from their different interpretations of the word "enforceable" in Article 31(2). (see paras 63 and 94) Whilst having the greatest respect for the views of Rix LJ I prefer the reasoning and conclusion of Chadwick LJ.[106]It is not disputed that actions for a negative declaration are commonly brought in the courts of the other countries party to CMR. It is plain that such proceedings come within the opening words of Article 31(2) because they are "legal proceedings arising out of carriage under this Convention" within Article 31(1). Equally such proceedings are brought on the same grounds as their mirror image of an action for a declaration of liability and a claim for damages. But if such proceedings are to be excluded by force of the concluding words of Article 31(2) then the evident intention of the makers of CMR will be defeated over a wide and obvious area of its potential operation.[107]I appreciate that a similar point may be made in relation to the limitation difficulty to which Rix LJ has drawn attention. But that problem would only arise from a concatenation of special circumstances. I prefer to conclude that the makers of CMR overlooked the consequences of such circumstances (or envisaged the likelihood of an alternative escape) as more probable than intending that actions for negative declarations should be excluded from the operation of Article 31 altogether.[108]Further CMR is an international treaty to which countries with many and diverse legal systems may be parties. To interpret the word "enforceable" in relation to judgments as excluding judgments which are only recognisable is to attribute to the word too limited and technical a meaning. I do not think that this court should do so, not least because the recognition by one court of competent jurisdiction of a negative declaration obtained from another is the only practical method of enforcing it.[109]For all these reasons I would dismiss the appeal on the ground that though the Austrian action was one to which Article 31 could apply it was not "pending" for the purposes of Article 31(2) at the time the English action was started.

Order

Appeal is dismissed with costs and permission to appeal refused. (This order does not form part of approved judgment)

Cited in 3 later judgments