Introduction
In Westbase Technology Limited v Vuzix Corporation [2026] EWHC 138 (Ch), Deputy Master Valentine addressed an application by overseas defendants to set aside permission for service out, engaging core principles on serious issue to be tried, good arguable case for a jurisdictional gateway, forum conveniens, and full and frank disclosure on a without‑notice application. The decision offers a clear illustration of how the High Court manages disputed jurisdiction where the existence and scope of the underlying contract are hotly contested and intertwined with the jurisdictional analysis.
Factual Background
Westbase and Vuzix were parties to a Distributor Agreement dated 15 June 2022, with New York governing law and an exclusive New York venue clause; exclusivity terms were extended to 31 December 2023 by an amendment of 11 April 2023 . Following poor sales performance and a dispute over exclusivity and representations, the parties held three late‑December 2023/early‑January 2024 calls during which Westbase alleged an oral settlement for staged repurchases of unsold stock at original prices . Vuzix made two repurchases in 2024 ($90,000 in January and $110,000 in April) and purported to terminate the Distributor Agreement in September 2024.
The Claims and the Service Out Application
Westbase brought a contract claim against Vuzix for breach of the alleged oral settlement and tort claims for negligent misrepresentation/misstatement against Vuzix and its executives, seeking approximately £728,905 plus interest. Permission to serve out was granted on the papers; Vuzix and its co‑defendants applied to set aside, contending that no binding settlement existed, the New York jurisdiction clause prevailed, England was not the appropriate forum, and there had been non‑disclosure on the without‑notice application.
Applicable Principles
The Court restated the three‑limb test for service out: (1) serious issue to be tried; (2) a good arguable case that a PD 6B gateway applies; and (3) England and Wales is clearly or distinctly the appropriate forum and the court should exercise its discretion to permit service out. On the “good arguable case” test, the Court adopted the Brownlie formulation requiring a plausible evidential basis, taking a view on the material where possible, and recognising that at the interlocutory stage a reliable assessment may not be feasible such that plausibility suffices. The Court emphasised that jurisdiction disputes are not the occasion for a mini‑trial, particularly where jurisdictional issues overlap with merits issues such as the very existence of a contract.
Analysis: Contract Gateway and Merits Threshold
The existence of a binding oral settlement was central both to the merits and to the contractual gateways relied upon (PD 6B, para 3.1(6)(a) and (c)). On the evidence, including transcripts referencing a “gentleman’s agreement,” the Court found a serious issue to be tried and, applying Brownlie and Kaefer, held that Westbase had a good arguable case that a contract existed without expressing concluded views on intention to create legal relations. As to gateway 3.1(6)(a), the Court noted unresolved factual issues as to offer and acceptance and where any offer was received, given parties in multiple jurisdictions, and treated the point as not determinative against the claimant at this stage . As to gateway 3.1(6)(c), the Court held there were disputed facts about any choice of law and whether English law applied under Rome I, but accepted that Westbase had a good arguable case that the gateway could be satisfied.
Forum Conveniens
On the forum limb, the Court weighed the competing practicalities, the disputed governing law, and the prior New York venue clause, and concluded that England and Wales was the appropriate forum on balance for the contract claim. The Court acknowledged that costs and timing considerations were significant in both jurisdictions and that evidence of foreign law would likely be needed whichever forum was chosen, but nonetheless found the balance favoured England and Wales.
The Tort Claims
The Court held that the tort claims (negligent misrepresentation against Vuzix and negligent misstatement against the individuals) did not meet the serious issue to be tried standard because the alleged statements were, in substance, promissory or supportive of contractual performance and not actionable in negligence on the pleaded case, and there was no sufficient assumption of responsibility by the individuals under Hedley Byrne principles. Permission to serve out was therefore varied to exclude the tort claims against all defendants.
Full and Frank Disclosure
On alleged non‑disclosure, the Court found that while Westbase could have more squarely presented aspects adverse to its case (including the “gentleman’s agreement” language and related inferences), the deficiencies were not deliberate and did not warrant setting aside permission for the contract claim. The Court therefore declined to set aside the permission order in full.
Outcome and Significance
The Court maintained permission to serve out for the contract claim against Vuzix, identified England and Wales as the appropriate forum for that claim, and removed permission for the tort claims. The judgment exemplifies the Court’s calibrated approach in disputed jurisdiction cases: it resists resolving merits‑laden factual controversies at the interlocutory stage, applies the Brownlie “good arguable case” framework flexibly where evidence is incomplete, and carefully evaluates forum conveniens with an eye to litigation practicalities rather than abstract connections alone. It also underscores that promissory statements bound up with alleged contractual performance are unlikely to be repackaged as negligence claims to found service out, and that non‑disclosure arguments will be assessed for materiality and intent with the overriding objective in mind.
Key Takeaways for Jurisdictional Strategy
Where the existence of a contract is both a merits issue and a jurisdictional gateway question, the Court may accept a plausible evidential basis without deciding who has the better argument, provided it avoids a mini‑trial on intention and formation . Exclusive foreign jurisdiction clauses in antecedent agreements may carry weight at the forum stage, but they will not be determinative if there is a properly arguable case that a subsequent, inconsistent agreement governs and if practicalities favour England. Careful without‑notice presentation remains essential: potentially adverse materials should be fairly flagged, though innocent shortcomings will not automatically vitiate permission.
James Newman instructed by Ryan Lynch of Broadfield Law acted on behalf of Vuzix Corporation.
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