A Q&A guide to dispute resolution law in the British Virgin Islands (BVI).
The country-specific Q&A gives a structured overview of the key practical issues concerning dispute resolution in this jurisdiction, including court procedures; fees and funding; interim remedies (including attachment orders); disclosure; expert evidence; appeals; class actions; enforcement; cross-border issues; the use of ADR; and any reform proposals.
To compare answers across multiple jurisdictions visit the Litigation and enforcement Country Q&A tool.
This Q&A is part of the PLC multi-jurisdictional guide to dispute resolution. For a full list of jurisdictional Q&As visit www.practicallaw.com/dispute-mjg.
Large commercial disputes are generally resolved through litigation in the commercial division of the Eastern Caribbean Supreme Court (ECSC). There is an increased tendency today to use expert evidence.
Mediation and arbitration are also used (see Question 30).
The limitation period for the following claims is six years from the date on which the cause of action accrued:
A claim in contract.
A claim in tort.
An action to enforce a debt.
An action to enforce an award.
If the action is based on fraud, or concealed by fraud or the action is for relief from the consequences of mistake, the limitation period begins to run from the date when the fraud or mistake was discovered or could, with reasonable diligence, have been discovered.
There is no limitation period for claims for fraudulent breach of trust to which the trustee was a party or privy. No limitation period exists for an action to recover:
From the trustee.
Proceeds in the hands of the trustee.
However, any other action to recover trust property has a limitation period of six years, from the date on which the right of action accrued.
The limitation period for an action on any judgment is 12 years (Section 4(4), Limitation Act, Cap 43) from the date on which the judgment became enforceable.
The limitation period for the recovery of land is 12 years from the date on which the right of action accrued for any person. The Crown has 30 years to recover land, unless the action is to recover foreshore, in which case the Crown has 60 years.
Matters that involve claims valued at more than US$500,000 (as at 1 March 2012, US$1 was about EUR0.7) are allocated to the commercial division of the High Court. The Commercial Court Judge may exercise his discretion to hear matters which are of a commercial nature in the commercial division of the High Court even though the claim does not satisfy monetary value.
All other civil matters with a value of over US$1,000 that are not dealt with by the Commercial Court; indictable and some summary offences, constitutional and administrative matters, family and land disputes, are heard by the High Court.
Civil matters which value less than US$1,000, summary offences, preliminary enquiries of indictable offences and some family matters are determined in the Magistrate Court.
Barristers, who are called to the British Virgin Islands (BVI) bar, have rights of audience to conduct cases in both chambers and open court. Solicitors can only conduct cases in chambers.
To be able to conduct cases in the courts of the BVI, foreign lawyers have to be called to the BVI bar.
The only foreign qualification that is recognised is admission to the English bar.
Fees are not fixed by law. Hourly rates are the most common type of fee structure used. Conditional and contingency fee arrangements are not common.
Litigation is usually privately funded by the parties to the litigation. Concerns about contravening the doctrines of champerty and maintenance discourage commercial funding of litigation. Champerty is an agreement between the party suing in a lawsuit (claimant) and another person, usually an attorney, who agrees to finance and carry the lawsuit in return for a percentage of the recovery (money won and paid). In common law, this was illegal on the theory that it encouraged lawsuits.
However, outside of these restrictions, third parties can fund litigation and contingency fee arrangements can be made between the lawyer and client.
While in maintenance, the person assisting the claimant receives no benefit.
Concerns relating to champerty and maintenance preclude the public disclosure of private funding arrangements, although these can still exist.
Insurance is generally not available for litigation costs. However, in certain sectors, such as the construction industry, professional indemnity insurance can be purchased to cover litigation costs.
The general rule is that court proceedings are held in public. However, documentation related to the case is confidential except the following:
The claim form.
Some proceedings are private and are held in chambers and are therefore not open to the public.
There are no pre-action protocols.
Proceedings are started by a claim form supported by a statement of claim, and in certain matters specified in the ECSC Civil Procedure Rules 2000 (CPR 2000), by a fixed date claim form supported by an affidavit. The claimant submits its claim form to a court. The court then issues the claim form for service.
Notice is given by the claimant to the defendant by service of the claim form on the defendant, personally or by fax, along with prescribed notes to the defendant setting out how to respond to the claim. The claim form must be served within six months of its issue for defendants within the jurisdiction and within one year of its issue for defendants outside the jurisdiction, unless the time for service is extended, otherwise the claim form becomes invalid. The claimant must obtain the court's permission to serve a claim form on a defendant outside the jurisdiction.
The defendant must serve both:
An acknowledgement of service.
A defendant in the jurisdiction must serve:
Their acknowledgement of service within 14 days.
Their defence within 28 days after service of the claim form and statement of claim.
Defendants outside the jurisdiction must serve their defence within the time periods specified in Practice Direction 7 (4 of 2008). For the US, Europe (Eastern and Western), Asia, the Middle East, the Far East, Africa and Australia, this time period is 56 days after service of the claim form and statement of claim.
After service of the defence, the claimant can file a reply. The claimant may file and serve a reply to a defence within 14 days from the date of service of the defence or at any other time with the permission of the court.
No further pleadings are to be filed without leave of the court, except that if the defence includes a counterclaim, the claimant can file a defence to counterclaim which can form part of the reply.
Subsequently, a date is set by the court for a case management conference, at which stage standard directions are given for, among other things:
Interim applications must be made at the case management stage.
A party can bring the following actions for a case to be dismissed before a full trial:
Summary judgment. The court has power to grant summary judgment if it considers that either:
the claimant has no real prospect of succeeding on the claim or issue; or
the defendant has no real prospect of successfully defending the claim or issue.
Strike out application. The court has power to strike out a party's statement of case if it considers that a party has failed to comply with a rule, practice direction, order or direction given by the court, or the statement of case:
does not disclose any reasonable ground for bringing the claim;
is an abuse of the process of the court;
is likely to obstruct the just disposal of the proceedings; or
is verbose or does not comply with the requirements set out in CPR 2000 dealing with how to start proceedings and file a defence.
Default judgment (failure to file acknowledgment of service). This is the early determination of a claim if the defendant fails to file an acknowledgement of service within the time limits set out in CPR 2000. The court must be satisfied that:
the claimant has served the claim form and statement of case;
the defendant has not filed a defence or an acknowledgment of service;
the claim is for a specified sum of money apart from costs and interest and the defendant has not filed an admission of liability; and
the period for filing an acknowledgment of service has expired.
Default judgment (failure to file defence). This is the early determination of a claim if the defendant fails to file a defence within the time limits set out in CPR 2000. The court must be satisfied that:
the claimant has served the claim form and statement of case;
the period for filing a defence and any extension agreed by the parties or ordered by the court has expired; and
the defendant has not filed a defence, admitted liability or satisfied the claim.
Judgment on admission. It is possible to enter a judgment on admission if:
the claimant proves service of the claim form and statement of case; and
the defendant has filed an acknowledgment of service or a defence admitting the whole or part of the claim.
A defendant can apply for an order for the claimant to provide security for its costs if the court is satisfied that:
A person other than the claimant has contributed or agreed to contribute to the claimant's costs in return for a share of any money or property the claimant may recover.
The claimant failed to give his address, provided an incorrect address in the claim form or changed his address since the claim was commenced.
The claimant has taken steps with a view to placing the claimant's assets beyond the jurisdiction of the court.
The claimant is acting as a nominal claimant, other than as a representative claimant and there is reason to believe that the claimant will not be able to pay the defendant's costs if ordered by the court.
The claimant is an assignee of the right to claim and the assignment has been made with a view to avoiding the possibility of a costs order against the assignee.
The claimant is a foreign company.
The claimant is normally resident outside the jurisdiction.
Interim injunctions are available before a full trial commences. The applicant must show that:
There is a serious issue to be tried, and in the case of a Mareva injunction (that is, an order freezing a party's assets) that there is a good arguable case against the respondent.
There is a real risk of dissipation of the assets, in the case of a Mareva injunction.
Damages will not be an adequate remedy.
The balance of convenience favours the applicant.
Interim injunctions can be obtained without notice to the defendant and in urgent cases on the same day. There is a practice that the application must be accompanied by a certificate of urgency, briefly setting out the reason why the application for the injunction is urgent.
Mandatory interim injunctions are available, in addition to prohibitory interim injunctions but are only granted in exceptional circumstances.
Interim attachment orders are available for:
The detention, custody or preservation of relevant property.
The payment of income from relevant property until a claim is decided.
The grounds are similar to the grounds for freezing orders.
Interim attachment orders can be obtained without notice to the defendant if it appears to the court that there are good reasons for not giving notice. The evidence in support must state the reasons why notice was not given.
Based on the wording of the CPR 2000, interim attachment orders are only available in claims before the local court. However, in a recent decision the commercial division of the High Court granted a Mareva injunction (see Question 12) to preserve assets in relation to a foreign proceeding, based on common law principles (Black Swan Investment ISA v Harvest View Limited and Sablewood Real Estate Limited BVIHCV 2009/399).
An interim attachment order does not create any preferential right or lien in the claimant's favour.
The claimant can be liable for damages if the defendant suffers loss as a result of the injunction and the defendant is successful on claim.
The claimant can be required to provide security (fortification of a cross undertaking in damages) at the court's discretion.
The court can grant interim remedies, including:
An interim declaration.
An order directing a party to prepare and file accounts relating to the dispute.
An order directing a party to provide information about:
the location of relevant property or assets; or
relevant property or assets which are or can be the subject of an application for a freezing order.
An order for a specified fund to be paid into court or otherwise secured where there is a dispute over a party's right to the fund.
An order permitting a party seeking to recover personal property to pay a specified sum of money into court pending the outcome of the proceedings and directing that, if the party does so, the property must be given-up to the party.
An order to deliver-up goods.
An order (that is, a search order) requiring a party to admit another party to premises for the purpose of preserving evidence and so on.
The main remedies available at full trial are:
Order for specific performance.
Damages can also be punitive. The court can award exemplary damages to punish the defendant and vindicate the strength of the law. Exemplary damages can only be awarded in actions in tort, and only in the following three categories of cases:
Oppressive, arbitrary or unconstitutional action by government servants.
Cases in which the defendant's conduct has been calculated by the defendant to make a personal profit which exceeds the compensation payable to the claimant.
Where it is expressly authorised by statute.
Parties must disclose:
Documents which are directly relevant to the matters in question in the proceedings.
Documents which are or have been in the control of the parties.
There are detailed rules governing this procedure in Part 28 of CPR 2000.
Legal professional privilege, which is divided into legal advice privilege and litigation privilege, covers:
Correspondence between a party to litigation and its legal representatives.
Any other document produced in contemplation of, arising from or in connection with legal proceedings for the purposes of obtaining legal advice. This covers documents written by a local or foreign in-house lawyer.
Non-disclosure can be justified if:
Crown or public interest privilege applies.
The document is not relevant to the matters in dispute.
The document is part of without prejudice communications, for example, communication in an attempt to settle the dispute.
A party cannot object to producing a document not covered by legal professional privilege simply because the information contained in a document was imparted to the party in confidence. Confidentiality, between a party to the litigation and a third party, is not a separate head of privilege, although it can be a material consideration to bear in mind when privilege is claimed on the grounds of public interest.
Witness statements must be filed and witnesses of fact are generally required to be present at the trial to be cross-examined, unless the court or the other side does not require the witness to attend.
See above, Oral evidence.
The court has power to order expert evidence to be given.
The expert is usually chosen by the parties.
An expert has an overriding duty to impartially help the court. This duty overrides any obligation to the person he is instructed or paid by.
There is a right to cross-examine expert witnesses. The court can request that the experts put questions to each other and the questions and responses are then submitted to the court.
The parties are jointly and severally liable for jointly-appointed expert fees. If an expert gives evidence on behalf of one party, that party is responsible for the expert's fees. However, if that party is ultimately successful, he may recover a proportion of the expert's fees in costs from the opposing party.
Appeals are made to the Eastern Caribbean Court of Appeal (Court of Appeal), and from the Court of Appeal to the Privy Council.
In relation to the grounds for appeal, an appeal will not be heard from an order which was within the discretion of the judge to make, unless it is shown that the judge exercised this discretion in one of the following circumstances (Quillen & Others v Harney Westwood & Riegels No 2 (2001) 58 WIR 147):
Under a mistake of law (Evans v Bartlam  AC 473).
In disregard of principle (Young v Thomas  2 Ch 134, Birkett v James  2 All ER 80 and Tolley v Morris  2 All ER 561).
Under a misapprehension as to the facts.
The judge took into account irrelevant matters (Egerton v Jones  3 All ER 889).
The judge failed to exercise discretion (Crowther v Elgood (1887) 34 Ch D 691).
The conclusion which the judge reached in the exercise of his discretion was "outside the generous ambit within which a reasonable disagreement is possible" (G v G  2 All ER 225).
Acting "in disregard of principle" refers to a situation where a lower court gives weight to something which the judge should not have taken into account, or where a lower court fails to give weight to something which should have been taken into account.
Applications for leave to appeal must be made within 14 days of the order being appealed against. Where an application for leave to appeal has been refused by the High Court, an application for leave may be made within seven days of such refusal. An application for leave may be considered by a single judge of the Court of Appeal. The Judge may give leave without hearing the applicant. However, if the Judge is minded to refuse leave he must direct that a hearing be fixed and whether the hearing is to be by a single judge or the court.
Notice of appeal and submissions must be filed within 21 days from the date of obtaining leave. The respondent must do both of the following:
Within seven days of being served with the notice to appeal, file and serve a notice in opposition.
Within 14 days of being served with the notice to appeal, file and serve written submissions in opposition to the appeal.
The following rules apply when leave to appeal is not required:
In the case of an interlocutory appeal where leave is not required, the notice of appeal and submissions must be filed within 21 days from the date the decision was made.
The respondent must:
within seven days of being served with the notice to appeal, file and serve a notice in opposition; and
within 14 days of being served with the notice to appeal, file and serve written submissions in opposition to the appeal.
A notice of appeal in the case of procedural appeals must be filed within seven days from the decision date along with written submissions.
A respondent must file and serve written submissions within seven days of receipt of the notice of appeal.
As a general rule, procedural appeals are dealt with on paper by a single judge of the Court of Appeal and must be dealt with not less than 14 days and no more than 28 days after filing of the notice of appeal. The judge may require oral submissions and direct that the appeal be heard by the full court. Any oral hearing must take place within 42 days after filing.
In the case of an interlocutory appeal where leave is not required, the notice of appeal must be filed within 21 days of the date the decision was made.
In the case of other appeals, a notice of appeal must be filed within 42 days of the date when the order or judgment appealed against was made. A respondent can file a counter notice of appeal within 14 days of service of the notice of appeal.
The appellant's skeleton arguments must be filed and served within 42 days of receiving notice from the court registry that the transcript of proceedings in the first instance court is available.
The respondent must file its skeleton arguments within 28 days of being served with the appellant's skeleton argument.
The appellant can file a skeleton argument in reply within 14 days of being served with the respondent's skeleton argument.
The appellant is responsible for preparing the Record of Appeal in accordance with CPR 2000.
The Court of Appeal serves nine territories. It sits in the BVI three times a year, usually in January, May and September.
There are no specific provisions in BVI for class actions and no opt-out or opt-in provisions. However, multiple claimants can bring a representative action in which one or more claimants will represent all the claimants. Any decision of the court affects all persons represented (CPR 2000, Part 21).
The general rule is that the unsuccessful party must pay the successful party's costs. There is no concept of indemnity costs under CPR 2000. A party is entitled to reasonable costs. There is provision to apply at a case management conference for the court to fix a costs budget. If this is not done, the prescribed costs apply, which is a percentage of the value of the claim. Different percentages apply to different value brackets in accordance with a schedule set out in the CPR 2000.
Budgeted costs and the prescribed costs regime do not apply to commercial matters (CPR 2000, 69B.10). In giving its decision, the court will decide:
Which party (if any) should pay costs to the other party.
How much in principle is to be paid (taking into account the factors listed below and any other matter which the court thinks is relevant).
If the hearing of an ordinary application occupied the court for one day or less, the court will summarily assess the quantum of costs.
In other cases, the court may fix a date for an assessment hearing to be carried out by the Commercial Court Judge or the Master in relation to commercial matters. Assessed costs rules in CPR 2000 apply.
In deciding what would be reasonable the court must take into account all the circumstances, including:
Any order that has already been made.
The care, speed and economy with which the case was prepared.
The conduct of the parties before as well as during the proceedings including any pre-trial offers to settle.
The degree of responsibility accepted by the legal practitioner.
The importance of the matter to the parties.
The novelty, weight and complexity of the case.
The time reasonably spent on the case.
Whether the legal practitioner advised the client and took the client's instructions before taking any usual step or one which was unusually expensive having regard to the nature of the case.
Interest is awarded on costs once an order for costs is made at 5% per year in accordance with the Judgments Act.
The main enforcement provisions are:
Order for seizure and sale of goods.
Appointment of a receiver.
Writ of possession of land.
Seizure of assets order.
Order for sale of land.
The local courts respect the choice of governing law clause in a contract and can accept expert evidence of foreign law.
The court will hear a claim which is brought in respect of:
A breach of contract committed in the jurisdiction.
A contract where the contract:
contains a term to the effect that the court shall have jurisdiction to determine any claim in respect of the contract;
is by its terms or by implication governed by the law of the BVI;
was made by or through an agent trading or residing within the jurisdiction; or
was made within the jurisdiction.
Local courts can exercise jurisdiction in any case where jurisdiction arises as of right. However, a choice of jurisdiction clause can be used in an application to stay the proceedings on the basis of the choice of jurisdiction clause. If a choice of jurisdiction clause confers exclusive jurisdiction on a foreign court, the BVI court will consider and normally give effect to it. However, it is subject to the overriding principle that no one, by private stipulation in a contract, can oust the court of its jurisdiction in a matter properly belonging to it. The court is, therefore, not bound to grant a stay, but has discretion whether to do so. The factors relevant to the exercise of this discretion are also broadly similar to the criteria considered under the doctrine forum non conveniens. However, the position is not precisely the same as it is a prima facie rule that the parties must honour their agreement to refer disputes to the foreign tribunal. Accordingly, the burden is on the claimant to show a strong cause for a stay to be refused. A stay is refused if the choice of jurisdiction clause is considered void.
The BVI does not claim jurisdiction in certain types of disputes. For example:
On an application to appoint a liquidator over a BVI company.
Where the contract concerns real property in the BVI.
The BVI is a party to the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters 1965 (Hague Service Convention). The documents are usually sent to the relevant local authority, that is:
The Governor's office.
The High Court Registry.
The documents are given to the bailiffs of the High Court Registry to effect service on the registered office of the company. The bailiffs usually serve the documents personally on the registered agents. The appropriate certificate is completed by the Registrar of the High Court and returned to the foreign party.
Documents can also be served by authorised service agents, such as private bodies, of the claimant.
The BVI is a party to the HCCH Convention on the Taking of Evidence Abroad in Civil and Commercial Matters 1970 (Hague Evidence Convention), which is embodied in the Evidence (Proceedings in Foreign Jurisdictions) Act, Cap 24.
The foreign court or tribunal must send a letter of request to the local authority (the Governor's office and the High Court Registry). The Attorney-General, in appropriate circumstances, obtains an order from the local court, which is served on the party in question. The evidence is usually given by witness statement, but the order can direct the examination of the witness before:
Any fit and proper person.
An examiner of the court.
Any other qualified person as the court sees fit.
The evidence is then sent to the court which affixes a sealed certificate, including the letter of request, the court order and the evidence, which is then sent to the minister with responsibility for foreign affairs or convention authority for transmission to the foreign court or tribunal.
A judgment from the High Court in England, or Northern Ireland or in the Court of Session in Scotland, may be registered in the High Court of the BVI within 12 months after the date of the judgment or such longer period as may be allowed by the court if in all the circumstances of the case the court thinks that it is just and convenient that the judgment should be enforced in the BVI pursuant to the Reciprocal Enforcement of Judgments Act, Cap 65. Certain other foreign judgments may be registered and be enforced in the BVI including (Foreign Judgment Reciprocal Enforcement Act and Reciprocal Enforcement of Judgments Act):
Australian Capital Territory.
Federal Republic Nigeria.
New South Wales.
Trinidad and Tobago.
Northern Territory of Australia.
Australian Antarctic Territory.
Heard and McDonald Islands Territory.
Coral Islands Territory.
Territory of Ashmore and Carter Islands.
Cocos (keeling) Island.
Commonwealth of Australia.
The judgment creditor may apply at anytime within six years after the date of the judgment or if there has been an appeal after the date of the last judgment in the proceedings to have the judgment registered in the court.
The procedure to enforce a foreign judgment from these countries is as follows:
An application to register the judgment can be made without notice but must be supported by a witness statement.
The original, or a certified or otherwise duly authenticated copy of the judgment must be included, with an English translation if it is in another language.
The order registering the judgment must state the period in which an application can be made to set aside the registration, and contain a notice that execution of the judgment will not start until after the expiry of that period.
Notice of registration must be served on the judgment debtor.
The judgment creditor from other countries must bring a fresh action in a BVI court to sue on the foreign judgment as a debt.
The main methods of ADR used in the BVI are:
The Arbitration Act, Cap 6 provides the framework for arbitration. It makes provisions for:
The appointment of arbitrators and umpires.
The conduct of proceedings.
Costs of the arbitration.
Interest on awards.
Setting aside awards.
Enforcement of awards.
The court must actively manage cases, including encouraging the parties to use any appropriate form of dispute resolution, in particular mediation, if the court considers it appropriate (Rule 25.1(h), ECSC Civil Procedure Rules). Practice Direction No. 1 of 2003 provides for court connected mediation. The courts usually refer commercial disputes to mediation with the parties' consent. The parties must select a mediator from the court's list of court appointed mediators. If the parties cannot agree on the mediator, the court will appoint one from its list of certified mediators. The dispute is usually stayed until the mediation takes place. If there is an agreement, then this is usually made into a binding order.
If no agreement is reached, the dispute is sent to case management conference.
Mediation is used more frequently than arbitration.
ADR is rarely used in commercial matters in the BVI. However, efforts are being made to settle more commercial disputes using arbitration. Mediation is usually used in land disputes and other civil matters.
Courts cannot compel parties to use mediation, arbitration or any other forms of ADR. The parties must agree to ADR.
In arbitration proceedings, evidence is given in the same manner as in court litigation (see Questions 16 to 19). Documents produced and admissions made in arbitration proceedings are not confidential. However, documents produced and admissions made during mediation are confidential.
In arbitration proceedings, unless the parties agreed otherwise in the arbitral agreement, the arbitrator will rule on costs. In mediation, each party bears 50% of the mediation fees, and each party bears its own costs for legal representation and so on.
The court connected mediators are the only mediation providers (see Question 30). Arbitrators are selected by the parties or in accordance with a procedure determined by contract.
There are currently no proposals for dispute resolution reform.
Qualified. British Virgin Islands, 1980; Appointed Queen's Counsel, 2003
Areas of practice. Commercial litigation and corporate insolvency.
Qualified. British Virgin Islands, 2007
Areas of practice. Commercial litigation; trusts and estates.
Qualified. Saint Kitts, 2002; British Virgin Islands, 2004; Antigua & Barbuda, 2009
Areas of practice. Commercial litigation; real estate; business advisory; shipping and admiralty.
Recent transactions. Application for interim injunction (Lonrho Africa (Holdings) Ltd v David Avnit and Others).