About this case:

• Citation:
  [2025] IESC 46
• Judgment:
  External link
• Court:
  Supreme Court
• Judge:
  Mr Justice Gerard Hogan

Delivering judgment for the Supreme Court, Mr Justice Gerard Hogan considered that the “very novelty and practical importance” of the issue of whether the appellant’s proceedings concerned the enforcement of a judgment for the purposes of Article 22(5) of the Lugano Convention “suggest that it would be desirable that there should be an authoritative ruling on this issue from the Court of Justice.

Background

Prior to 2018, a Belize-registered company, SJ Investments Ltd, made apparently unsuccessful investments in a Norwegian company, RenoNorden ASA. 

SJ Investments sought to pursue a claim to recover its losses. Before taking action, SJ Investments transferred its right to pursue that claim to its subsidiary, SJI Equities Ltd, an Irish company.

The appellant was one of two directors of SJ Investments, and prior to 2023, was the sole director of SJI Equities. SJI Equities took unsuccessful proceedings in Norway against RenoNorden and its former directors to recover losses sustained from the unsuccessful investment. 

On 9 December 2022, SJI Equities was ordered by the Borgating Court of Appeal to pay approximately €1 million to the former board members of RenoNorden. As SJI Equities had never been capitalised and never held a bank account, all its litigation costs were met by SJ Investments.

RenoNorden’s directors held insurance with the Norwegian branch of the Irish-registered respondent, which covered their legal costs. Pursuant to the insurance policy, Zurich was subrogated to the directors’ entitlements under the costs order. 

Zurich pursued proceedings in Norway against the appellant to hold him personally liable for the costs of the RenoNorden proceedings given that SJI Equities had no funds, seeking what would be regarded as a “non-party costs order” in Ireland.

On 1 February 2023, Zurich successfully applied ex parte to the Norwegian District Court for a form of protective order requiring the appellant’s assets to be frozen pending the determination of its claims against him under legislation known as the Disputes Act. The appellant argued that as SJI Equities was an Irish company the matter should be dealt with by reference to Irish law, an argument rejected by the Norwegian District Court.

This was upheld following an inter partes hearing and on appeal, with the Court of Appeal accepting that the main Zurich claim under the Disputes Act was probable and proved to the extent required and determining that the transfer of claims between SJ Investments and SJI Equities likely formed the basis for liability as it led to the companies isolating themselves from the responsibility for costs in a way that created a clear risk for Zurich, and upheld the protective order.

Prior to the final judgment of the Court of Appeal being handed down, the appellant issued a plenary summons in Ireland against Zurich, claiming damages for tortious interference and a negative declaration that he was not personally liable for any loss or damage incurred by Zurich in the RenoNorden proceedings.

The summons was endorsed to the effect that the Irish High Court had jurisdiction to hear and determine the proceedings under Article 2(1) of the Lugano Convention given that Zurich is domiciled in Ireland for the purposes of the Convention.

Knowing that the appellant had issued proceedings in Ireland, the Norwegian Court of Appeal held that liability was regulated by Norwegian and not Irish law. Zurich subsequently made an application in the Irish High Court seeking to set aside the plenary summons and to dismiss the proceedings on the basis that the Norwegian courts had exclusive jurisdiction.

The High Court and Court of Appeal

The High Court held that the key question was whether Article 22(5) of the Convention applied, which states in part: “The following courts shall have exclusive jurisdiction, regardless of domicile: … (5) in proceedings concerned with the enforcement of judgments, the courts of the State bound by this Convention in which the judgment has been or is to be enforced.”

Mr Justice Michael Twomey dismissed the proceedings on 14 November 2023, finding that the Norwegian courts had exclusive jurisdiction on the basis that the proceedings involved the determination of costs or expenses and were proceedings dealing with the actual execution of a judgment already obtained, and so Article 22(5) applied.

The Court of Appeal upheld the High Court’s order, finding inter alia that the issue of non-party liability for an existing costs order is directly intertwined with the enforcement of an existing costs judgment, providing the necessary specificity of connection and degree of proximity with enforcement to engage Article 22(5).

The question presented to the Supreme Court was whether the Irish courts had jurisdiction to grant the negative declaration that the appellant was not personally liable qua third party in respect of the costs order made by the Norwegian courts.

The Supreme Court

Mr Justice Hogan noted that one of the “curious features” of the appeal was that the proper construction of Article 22(5) attracted little judicial attention to date.

Noting that the starting point for both the Convention and the Brussels Regulation (Recast) is that any derogation from the rule as to general jurisdiction in Article 2(1) must be strictly construed, the court considered that there must be a very close connection between the measures taken by the judgment creditor and the actual enforcement of the judgment by way of execution, for such measures to come within the scope of the exclusive jurisdiction provision.

Having regard to the relevant jurisprudence, Mr Justice Hogan reasoned that the provisions of the Convention envisage that there are physical acts or enforcement that will take place in an identified location, intended to ensure that the courts of justice of the place in which these physical acts take place will have exclusive jurisdiction and reflecting the principle of public international law that force is not to be used within a state on foot of a foreign court’s order.

The court expressed doubt that the issue raised in the Irish proceedings was directly bound up with the enforcement of the Norwegian costs order, where the proceedings were not concerned with the actual execution of the Norwegian judgment, “such as would occur if, for example, a court appointed official sought to supervise the realisation of assets or the sale of immovable property”.

Mr Justice Hogan continued: “Indeed, it is accepted that the Norwegian proceedings which have been commenced by Zurich against Mr Vigeland and concern liability for third party costs are themselves treated as a separate cause of action claiming damages in tort under Norwegian law…”

To that extent, Mr Justice Hogan disagreed with the Court of Appeal, considering that the separate proceedings concerning the liability of the appellant for non-party costs are not proceedings concerned with the enforcement of a judgment for the purposes of Article 22(5) and that if this was correct, the Irish courts had jurisdiction to entertain the Irish claim for a negative declaration in respect of liability for those costs, by reason of Zurich being domiciled in Ireland.

Noting that this issue had not been authoritatively decided by the Court of Justice, the Supreme Court made a reference pursuant to Article 267(3) of the Treaty on the Functioning of the European Union of the following question:

Conclusion

Accordingly, the Supreme Court stayed the appeal pending the outcome of the reference.

Vigeland v Zurich Insurance Public Limited Company [2025] IESC 46