Conditional Dismissal in Forum Non Conveniens
In the course of their careers, international litigators will inevitably come across common arguments, defenses and claims. One such claim is "forum non conveniens" (FNC)
Very simply put, the FNC defense will be raised by defendants who claim that there is a more appropriate geographical location to litigate the case at bar. Every jurisdiction has its own unique path to conclude whether grant the FNC defense and dismiss the action, or to deny the FNC claim and let the case continue.
However, even when a court is inclined to dismiss an action based on an FNC defense, it may condition the dismissal on the defendant's undertaking not to raise certain challenges in the other, more appropriate, forum.
A common example is when there are legal/procedural obstacles in filing a suit in the more appropriate court, such as limitations. In such a case, a court may condition the dismissal of the action on the defendant's undertaking not to raise a limitations defense in the foreign court. The logic behind this approach is that the very core of the FNC defense is that the defendant contends that there is a more appropriate place to litigate the present action. If it turns out that the plaintiff is barred from pursuing his/her claim in the foreign court, then how could it be a more "appropriate" place to litigate.
That said, only under certain circumstances will an Israeli court condition a dismissal based on FNC grounds. The leading decision laying out the framework for a conditional dismissal is Hecke v. Pimcapo Ltd., Civil Appeal 9810/05. The decision was issued in 2009 by Justice Gronis, Justice Rivlin and Jubran cocurring.
In Hecke, the defendant filed a motion to dismiss, raising the FNC defense. The District Court denied the motion to defense and the defendant appealed to the Supreme Court. The Supreme Court found that the District Court erred in denying the motion to dismiss and concluded that the more appropriate forum was Germany. However, the Supreme Court conditioned the dismissal of the case on defendant/appellant's undertaking not to raise a limitations challenge in the German courts.
Hecke sheds light as to the criteria the courts will (and indeed do) apply when deciding whether to condition a dismissal. Here are some guidelines:
1. If it clear that the Israeli forum was inappropriate to begin with, courts will be less inclined to make the dismissal conditional.
2. Did the plaintiff take reasonable steps to make sure the action would not be barred my limitations in the foreign forum? In other words, if the Israeli action was filed after the limitations period of the foreign forum, an Israeli court will be inclined to dismiss the case, without any conditions.
3. Was the foreign law properly presented and briefed before the court? Ultimately, a plaintiff's contention that the foreign forum present legal obstacles is a question of foreign law which, under Israeli practice, needs to be proven by way of expert legal opinion.
Applying Hecke, here are several tips for the international practitioner.
The "conditional dismissal" claim should be raised in the context of the response to the motion to dismiss and be backed up by an expert opinion which supports the contention that the case would face legal obstacle otherwise absent in the Israeli forum.
Most importantly, the response should put up a good argument why the Israeli forum is the appropriate forum in the first place- not only will that provide a basis for dismissing the FNC challenge entirely, but it should also convince the court that the plaintiff was reasonable in filing in Israel, even though he/she may have been mistaken in the choice of the forum.
Conditional dismissals in the FNC context are rare. To the best of my knowledge, few cases have applied Hecke, and when courts have applied it, they found that the cases were distinguishable. This was done usually by finding that the plaintiff was unreasonable for filing in Israel in the first place. Depochem Ltd. v. Wacker Chcmic AG, Civil Appeal 6767/15 (2015); Nigel Willaim v. Deutsche Telekon AG, Civil Appeal 4025/13 (2014).