The use of anchor defendants as a litigation strategy relies upon two basic principles common to most legal systems.
For example, with the European Union, Article 6 of the Brussels I Regulation provides: Similarly, the English Civil Procedure Rules provide in RSC Order 11 (found in Schedule 1):[2] As with other types of forum shopping, the courts in various jurisdictions have taken steps to try to prevent the abuse of court systems by using anchor defendants.
However, attempts to do so will always be limited by the powerful countervailing considerations of the need to ensure that all connected actions should be tried by a single court where ever possible.
In AK Investment CJSC v Kyrgyz Mobil Tel Ltd[4] Lord Collins gave the opinion of the Privy Council summarising the applicable principles of common law[5] in relation to determining whether it was proper to grant leave to serve proceedings on a foreign defendant who the court would not otherwise have jurisdiction over after the action had been originally commenced against an anchor defendant: Lord Collins subsequently endorsed his own decision on those points in Nilon Limited v Royal Westminster Investments S.A..[6] In Multinational Gas and Petrochemical Co v Multinational Gas and Petrochemical Services Ltd[7] the liquidators of an insolvent company incorporated in Liberia wished to bring claims against the company directors in England for breach of duty and negligence.
The English Court of Appeal held that the only basis for bringing proceedings against the broker was to try to bring the former directors within the jurisdiction of the court, and for this and other reasons[8] they refused to grant leave to serve the writ outside of the jurisdiction on the directors.