This article was produced by Nabarro LLP, which joined CMS on 1 May 2017.
Summary and implications
A Norwich Pharmacal order is an order whereby the English court can order a party which is not party to the main litigation, but which has innocently been caught up in wrongdoing, to disclose documents or information which may be evidence of the wrongdoing itself. This order was developed out of a House of Lords decision in 1974 in Norwich Pharmacal v Customs & Excise Commissioners. Such orders are frequently made in patent infringement cases as well as defamation and fraud.
In the recent case of AB Bank Limited, Off-Shore Banking Unit v Abu Dhabi Commercial Bank PJSC (ADCB Dubai), a case concerning the fraud of $20m, Mr Justice Teare decided that the court did not have jurisdiction to make a Norwich Pharmacal order against ADCB Dubai, and reversed an earlier order made in a without-notice hearing by Mr Justice Cooke. The background to the case involved a sharia-compliant agency agreement (a Wakala) for the lending of money into the Bangladeshi market. The arguments centred on whether or not the jurisdictional gateways against ADBC Dubai had been satisfied.
The alleged fraud had no connection with England except that:
- the provisions of the amended Wakala agreement provide for English law and jurisdiction;
- that the amendment was negotiated and executed in England; and
- that the amendment is said by the claimant to be a continuation of the fraud.
An order permitting service out of the jurisdiction of a claim form may only be made if the claim can be brought within one of the jurisdictional gateways set out in the Practice Direction to CPR Part 6. Three gateways were relied on:
- interim remedy;
- injunction ordering act within the jurisdiction; and
- necessary and proper party.
The significance of this judgment is that the judge decided that if the party against whom a Norwich Pharmacal order is sought is outside the jurisdiction of England and Wales, the claim form against it will never get through these jurisdictional gateways and in particular the judge decided that for the purpose of the first gateway, interim relief must be interim between the claimant and the defendant to the principal action. Therefore, an application for a Norwich Pharmacal order is not interim relief as there will be no further proceedings, and it is not interim in that sense but is final.
It follows that Norwich Pharmacal orders will never be available against foreign parties. In practice, instead, one would need to apply to the local foreign court for assistance in obtaining evidence, assuming a remedy is available, perhaps through a request for international assistance. This can be a very lengthy process and we have written an article here about that.