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MODI ENTERTAINMENT NETWORK V. W.S.G. CRICKET PVT. LTD. (AIR 2003 SC 1177)

 

MODI ENTERTAINMENT NETWORK V. W.S.G. CRICKET PVT. LTD.

(AIR 2003 SC 1177)

 

FACT

  • The appellants, Modi Entertainment Network & Anr., filed a suit in the Bombay High Court claiming damages for the loss of advertising revenue due to alleged illegal threats by the respondent, W.S.G. Cricket Pte. Ltd.
  • The dispute arose in the context of broadcasting rights for cricket matches.
  • The Appellants-plaintiffs contended that the respondent’s actions had a detrimental impact on their revenue from advertising during cricket broadcasts.
  • The respondent filed an action in the High Court of Justice, Queen’s Bench Division (the English Court), for the money owed under the agreement.
  • The appellants entered an appearance in the English Court but also filed for an anti-suit injunction in the Bombay High Court, claiming that the Indian court was the natural forum and continuing the English proceedings would be vexatious and oppressive.
  • A learned Single Judge of the Bombay High Court granted an ad-interim injunction on January 30, 2002, against the respondent.
  • The respondent appealed, and a Division Bench of the Bombay High Court set aside the Single Judge’s order on April 1, 2002, allowing the appeal and dismissing the appellants' motion.
  • Hence, the present appeal against Division Bench Order.

 

ISSUE

  • The central issue in this case was whether the Division Bench of the High Court erred in vacating the anti-suit injunction granted by a learned Single Judge. The injunction had restrained the respondent from proceeding with the action between the same parties pending in the English Court, which was the forum of their choice. The case required an examination of the principles governing the grant of an anti-suit injunction by a court of natural jurisdiction against a party to a suit before it, restraining them from instituting or prosecuting a suit in a foreign court.

 

RULE

  • The Courts in India have power to issue anti-suit injunction to a party over whom it has personal jurisdiction, in an appropriate case. This is because Courts of equity exercise jurisdiction in personam. However, having regard to the rule of comity, this power will be exercised sparingly because such an injunction though directed against a person, in effect causes interference in the exercise of jurisdiction by another Court.

 

HELD

  • The court observed several key principles regarding the granting of anti-suit injunctions. First, the court must ensure the defendant is subject to its jurisdiction, and denying the injunction should not result in injustice. Additionally, the principle of comity, or respect for the foreign court, must be considered.
  • In cases where multiple forums are available, the court will examine the most appropriate forum, or "forum conveniens," and may grant anti-suit injunctions if the proceedings are oppressive, vexatious, or in a forum non-conveniens. Exclusive or non-exclusive jurisdiction clauses in contracts are relevant but not determinative; courts usually respect these clauses unless strong reasons justify otherwise.
  • The court noted that anti-suit injunctions are rarely granted against a foreign court of choice unless there are good and sufficient reasons. The burden of proving that a forum is non-conveniens or that proceedings are vexatious or oppressive lies with the party seeking the injunction.
  • Applying these principles to the case, the court observed that the jurisdiction clause in the contract indicated the parties agreed to the non-exclusive jurisdiction of English courts. Despite the appellants filing the suit earlier in India, the contractual obligation to submit to English courts remained unless strong reasons justified otherwise.
  • The court discussed the case of Donohue, where the House of Lords found that it would not be in the interests of justice to hold the parties to their contract due to strong reasons shown by the respondent. In contrast, in SABAH, the Court of Appeal upheld an anti-suit injunction, finding that the non-exclusive jurisdiction clause in the agreement was binding and the action brought in the English court was not vexatious or oppressive. These cases illustrated that strong reasons must be shown to justify departure from contractual obligations.
  • The initial finding that proceedings in the English court would be oppressive and vexatious is not binding on the appellate court or the parties at a subsequent stage. It cannot be laid down as a general principle that proceedings brought in a court of natural jurisdiction or a court of choice would per se be oppressive or vexatious. The facts of each case must determine whether proceedings are vexatious or oppressive.
  • Having reviewed the plaints and the contract, the court concluded that the proceedings in the English court for recovery of the minimum guaranteed amount under the contract could not be deemed oppressive or vexatious at this stage.
  • The court stressed that the contractual intentions should be upheld unless there are compelling reasons to do otherwise. The appellants failed to provide such reasons. Despite not being the natural jurisdiction, the English court was the agreed forum for dispute resolution under English law. The appellants' argument that the English court was unsuitable due to the breach was not enough to override the jurisdiction clause. The parties were considered to have foreseen factors like legal costs and difficulty of bringing witnesses to the English court when they agreed to submit to English jurisdiction.
  • Ultimately, the court found no valid reasons to grant an anti-suit injunction in favor of the appellants, thus allowing the respondent to continue with the proceedings in the English court as per the jurisdiction clause in their contract.
  • The appeal was dismissed with costs, upholding the decision of the Division Bench of the Bombay High Court.

 

COMMENTARIES NOTE

  1. 1-10. Cases in which temporary injunction may be granted.—
  • The Court would grant injunction restraining a party from prosecuting suit in foreign Court when there is abuse of process of Court, the suit is false, frivolous or vexatious litigation, multiplicity of proceedings, other relevant consideration. [R. & I.C.S. (Pvt) Ltd v. Jenner Fenton Slade Ltd., AIR 2003 Bom 410 [LNIND 2003 BOM 77](416). (Principles summarized)].
  • Arbitration award was to be enforced in India, as such Indian Courts would have jurisdiction over the arbitration proceedings. Merely because England was made venue of arbitration did not confer jurisdiction on the English Courts. Anti-suit injunction was granted [Enercon (India) Ltd. v. Enercon GMBH,AIR 2014 SC 3152 [LNINDU 2014 SC 24]: (2014) 5 SCC 1 [LNINDU 2014 SC 24] : 2014 AIR SCW 3513 : 2014 (2) Scale 452 [LNINDU 2014 SC 24]].