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	England and Wales Patents County Court
You are here: BAILII >> Databases >> England and Wales Patents County Court >> Toth v Emirates [2011] EWPCC 18 (13 June 2011) URL: http://www.bailii.org/ew/cases/EWPCC/2011/18.html Cite as: [2011] EWPCC 18, [2011] FSR 39

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IN THE PATENTS COUNTY COURT

		Claim No: 1 CL 70012 St. Dunstan's House 133-137 Fetter Lane London, EC4A 1HD
		13/06/2011

JUDGE BIRSS :

1. In this case the claimant seeks various declarations, summarised in paragraph 12(a) of the claimant's skeleton argument. They are:

(a) a Declaration that (contrary to the allegation of the Defendant on which its Nominet Complaint was founded) the Domain Name is not an abusive registration in the hands of the Claimant within the meaning of the Nominet Policy;

(b) a Declaration that the decision of the Nominet Appeal Panel was not properly reached under Nominet Procedure (because of the Chairman's conflict of interest and his failure to disclose it);

(c) a Declaration that the defendant has made groundless threats of proceedings for trademark infringement in relation to the Claimant's use of the domain name and a corresponding Injunction;

(d) a Declaration that the Claimant's use of the Domain Name does not infringe the Defendant's registered trademarks;

(e) a Declaration that the Claimant's ownership of the Domain Name does not constitute passing off;

(f) an Injunction restraining the Defendant from interfering with the Claimant's registration and use of the Domain Name."

2. The real issue relates to declarations (a) and (b) ("the Nominet declarations").
3. It is common ground that if the court is prepared to allow the action to continue in relation to the Nominet declarations, then declarations in points (c) to (f) can safely be stayed. I will deal with declaration (b) separately. The real issue is declaration (a).
4. The matter arises as follows. The claimant, among other things, makes a business with domain names. He has a domain name: "emirates.co.uk". He registered it in 2002 and has been using it, on and off, since then. The defendant is the organisation which runs the famous airline associated with United Arab Emirates, the airline is often called Emirates.
5. In 2008 the solicitors acting for the defendant wrote two letters to the claimant. The letters were both dated 16th April 2008. In the first letter, the defendant's solicitors set out a heading called "Emirates' Rights", where they explained the background to the claimant and its success as an international airline. They referred to the domain name and contended that the domain name should be provided to them by the claimant. They also alleged that the claimant was conducting acts of passing off and that the domain name was an abusive registration under the relevant policy governing internet domain names. They required essentially that the claimant should transfer the domain name to their client.
6. In a second letter of the same date, which was headed "Without Prejudice", the solicitors for the defendant also put forward an indication that their client had no wish to be involved in the legal proceedings and would do everything to protect its rights. In addition, they stated that their client had registered trade marks and, it is said, by this letter the defendant uttered a threat of trade mark infringement proceedings. I should say that there is a dispute about whether the letter is or is not covered by the without prejudice rule but that dispute is not damaged by the reference to the letter in this judgment.
7. It was clear that the claimant was not going give in; nevertheless, nothing much happened. Then in 2010 the defendant used the Nominet Dispute Resolution Scheme to contend that the domain name was an abusive registration and sought to have it transferred to the defendant. This is a two-stage procedure. At the first stage an expert determines the matter. At that stage the claimant succeeded and the complaint was rejected. At the appeal stage, however, the appeal panel decided to uphold the complaint and therefore decided that the domain name should be transferred to the defendant from the claimant.
8. The claimant seeks to come before the court. Essentially the point of these proceedings from the claimant's point of view is to decide that he does not have to lose the domain name to the defendant and that the domain name should stay under control of the claimant.
9. The reason this case comes before me at this stage, that is to say before a defence has been filed, is that the defendant contends that the claim should be struck out.
10. There are technically three applications. The first is an application to declare that the second 16^th April 2008 letter is indeed without prejudice and therefore inadmissible. The second is to strike out the Particulars of Claim generally and the third is an application by the claimant to include a claim for a declaration relating to passing off (declaration (e) above).
11. There was an attempt to conduct the first application as a paper application under the rules governing procedures in the Patents County Court but it became very clear, as the papers on that application began to mount up, that it was a matter which would need to be dealt with at a hearing. I conducted a short hearing on the telephone to give directions and this is the hearing to decide all the applications. As explained at the beginning of this judgment, it became clear that it made sense to deal with declarations (a) and (b) first.
12. Ms. Himsworth, instructed by DLA Piper, appears for the defendant and Mr. Turner, instructed by Hansel Henson, appears for claimant.

The defendant's submissions

13. In summary, the defendant's submissions are as follows. The only basis on which a decision of Nominet's in these circumstances can be challenged is under what is called the law relating to "expert determination". If that is right, then the only grounds upon which it can be challenged are very narrow indeed. Essentially, they come down to two. First, that the expert asked or determined the wrong question. Second in relation to questions of bias undermining the decision, actual bias would be required. The law relating to apparent bias would not be relevant. So, for example, even if the decision was wrong, that would not be sufficient grounds to challenge the decision.
14. There is no doubt that neither point is a point that is taken by the claimant in this case. In other words, the claimant is not running a case to say that the wrong question has been approached and is not running a case of actual bias. So on that basis, says the defendant, declarations (a) and (b) should be struck out.
15. This is not a judicial review of Nominet, nor is it a proceeding under the Arbitration Act, so those matters cannot help the claimant. That also means that these declarations should be struck out. The declaration in relation to threats should be struck out because the threat of trade mark proceedings, if it was one, was made under the cloak of the without prejudice rule. No declaration should be given as to non-infringement of the registered trade marks, essentially for discretionary grounds and the same goes for the attempt to amend the pleadings to allow a claim for a declaration of passing off. So there is nothing left in this case and the case should be struck out. That is the defendant's submission.

The claimant's submissions

16. The claimant's submissions are that whether or not the matter is an "expert determination" depends on the relevant contract. The relevant contract in this case is the collection of terms that govern the relationship between Nominet and the claimant. It is submitted that as a matter of contract, the determination in this case is not one to which the law of "expert determinations" applies. So far as declarations are concerned, the case law, based on authorities such as Messier-Dowty v Sabena [2000] 1 WLR 2040 and then drawn together in Arrow Generics v Merck [2007] EWHC 1900 (Pat) and also in Nokia v Interdigital [2006] EWCA Civ 1618 means that, in summary, the court has a jurisdiction to grant binding declarations. The issue, as always, is whether in the exercise of its discretion it should do so.
17. So in the Nokia v Interdigital case, an attempt to strike out an action for a declaration that various patents were not essential to certain mobile telephone standards failed. It is submitted by Mr. Turner, essentially for similar reasons, a strike out at this stage should fail as well. Mr Turner says the court has a jurisdiction to hear this matter. Whether it will grant the declaration or not will be an exercise of discretion. Mr. Turner submits that the declaration would be useful because if it decides the question of abusive registration and declares it in Mr. Turner's favour, then it would obviously lead to the domain name not being transferred; and conversely-wise, if it decided the point against him, it would lead to the domain name being transferred.

The law on expert determinations

18. The law relating to expert determination was helpfully summarised by Ms. Himsworth. She referred me to a number of cases, in particular to Nikko Hotels v MEPC [1991] 2 EGLR 103 which was a decision of Knox J in 1991. This refers back to the then unreported decision of Jones v Sherwood Computer Services Limited [1992] 1 WLR 277. Essentially, Nikko Hotels v MEPC decided that if the matter is an expert determination within the meaning of that term as used in these cases, then the only ground on which it can be challenged is that a wrong question has been asked, rather than the sort of normal grounds that one might challenge a decision. So, for example, in the report at page 108, Knox J says as follows:

This decision of the Court of Appeal in Jones v Sherwood Computer Services is, of course, binding on me, as counsel on both sides before me accepted. In my judgment, it provides for a contractual analysis of the task set for the expert to perform and it gives full effect to the parties' agreement regarding with what it was that the expert should be entrusted.

The result, in my judgment, is that if parties agree to refer to the final and conclusive judgment of an expert an issue which either consists of a question of construction or necessarily involves the solution of a question of construction, the expert's decision will be final and conclusive and, therefore, not open to review or treatment by the courts as a nullity on the ground that the expert's decision on construction was erroneous in law, unless it can be shown that the expert has not performed the task assigned to him. If he has answered the right question in the wrong way, his decision will be binding. Even if he has answered the wrong question, his decision will be a nullity.

19. In relation to the question of bias, Ms. Himsworth referred me to Macro & Others v Thompson & Others, Thompson No. 3.[1997] 2 BCLC 36. The passage at page 64 of the report, running from F through to page 65 at H, in summary comes to the position that actual bias or actual partiality would be the crucial test, rather than the appearance of partiality.
20. In my judgment, the position is clear. If that line of cases applies in this case, then I should strike out declarations (a) and (b). Mr. Turner's point is that this line of cases does not apply. He refers me, for example, to a passage in Nikko Hotels at page 107 at (b) which goes back to Jones v Sherwood and then goes back to a passage from Lord Denning MR. The passage provides:

"Dillon LJ went on as follows:

It is therefore necessary to see how the law stands on the question of challenging an expert's certificate on the grounds of mistake.

[…]

The starting point for the modern statement of the law is, in my judgment, a decision in Campbell v Edwards [1976] 1 WLR 403, and in particular the passage at 407G in the judgment of Lord Denning MR, where he said:

'It is simply the law of contract. If two persons agree that the price of the property should be fixed by a valuer on whom they agree, and he gives that valuation honestly and in good faith, they are bound by it. Even if he has made a mistake, they are still bound by it. The reason is that they have agreed to be bound by it. If there was fraud or collusion, of course, it would be very different, fraud or collusion unravels everything.'"

21. Mr. Turner submits that for this line of cases to apply the agreement must provide that the expert's determination is both binding and conclusive. He submits that both are needed. He submits that in this case that is not the position. Mr. Turner draws an analogy with construction law, citing Ferson Contractors v Levolux, [2003] EWCA Civ 11 in which section 108 of the Housing Grants Construction and Regeneration Act in 1996 was considered by the Court of Appeal. The scheme of that Act allowed for certain interim decisions in the course of a construction dispute to be decided, essentially, by an adjudicator. The point was that the adjudicator's decision would be binding, that is to say that if the adjudicator decided that one party had to pay money to the other party then it was binding and they did have to pay. However the decision would not be conclusive because ultimately the point could be dealt with at the end and finally determined by legal proceedings or by arbitration or by agreement after the event.
22. In my judgment, one has to be very careful about applying analogies with a completely different scheme of law to the position in this case. I do accept Mr. Turner's point to this extent, that the Ferson Contractors case and the statute illustrates that there is a distinction between a decision which is binding and a decision which is conclusive.
23. Mr. Turner submits that for the cases that Ms. Himsworth has cited to apply in this case, it must be possible to find in the Nominet contract a provision which makes the expert's determination both binding and conclusive. That can only be done by considering the details of the Nominet procedure itself.

Other matters of law

24. Finally, the parties drew my attention, as they rightly should, to a decision of Ms. Proudman QC, as she then was, sitting as a deputy judge in the Chancery Division in June 2008. That case is Pankajkumar Patel v Allos Therapeutics Incorporated 2008 WL 2442985 dated 13^th June 2008. In that case, Mr. Patel was a litigant in person. Essentially he was involved in a domain name dispute with the defendant over the domain name allostherapeutics.com. It was not a Nominet case. As I understand it, what had happened was that under the ICANN Uniform Dispute Resolution Procedure ("UDRP") the adjudicator had decided that the domain name should be transferred to Allos Therapeutics and Mr. Patel was seeking to avoid that conclusion by starting proceedings in the English court. Ms. Proudman (as she then was) analysed the various causes of action which Mr. Patel put forward. They included a claim under the Human Rights Act, a claim under the Unfair Contract Terms Act, a claim for defamation, malicious falsehood, harassment and a claim for threats of trade mark infringement. Ms Proudman concluded that none of Mr. Patel's claims were meritorious; indeed, they were all totally without merit. Accordingly, she struck the action out. However, what Mr. Patel did not do was make a claim for a declaration in the way that Mr. Turner seeks to on behalf of his client. Nevertheless, it seems to me this is an important decision in this area, because it is a decision in which someone in a rather similar position to the claimant sought to come to court to invoke the court's jurisdiction in order to avoid a conclusion that they would lose a domain name and their attempt to do so failed. The principle on which Ms. Proudman decided the case was that she was unable to see how Mr. Patel had any right to retain the domain name. As I understand it, that was at least in part because of bankruptcy proceedings which had taken place (they are referred to in paragraphs 12 and 13 of the judgment). In particular at paragraph 12, Ms. Proudman states that:

"On 10th January 2007 a bankruptcy order was made against Mr. Patel. On 22nd May 2007 his trustee in bankruptcy disclaimed all interest in the domain names he had registered, including allostherapeutics.com. He cannot therefore rely on any property rights in the domain name. However Allos concedes that this did not for present purposes determine the matter because domain name registration confers personal as well as property rights."

25. The parties also referred me to paragraph 15 of the judgment in which the learned judge finds that an unsuccessful registrant faces considerable difficulty in identifying a cause of action upon which the Panel's decision can be challenged. In my judgment, while Mr. Patel's case is important, nevertheless, given that it was Mr. Patel acting for himself and bearing in mind the way in which the case was pleaded, it does not in the end seem to me to answer directly the issue I have to decide.
26. One of the debates between the parties is whether a domain name is a piece of property. In my judgment it is not necessary to decide that rather contentious question. What, in my judgment, must be right is that the claimant in this case has a claim to an interest in the domain name in question of some kind, since it is a registration which he has had since 2002 and wishes to hang on to. It is a registration which the Nominet system has currently decided should be transferred to the defendant and it is something which the defendant wants. In those circumstances, for this court to say that Mr. Toth has no claim to an interest in this domain name seems to me to be incorrect.

The relationship between Mr Toth and Nominet

27. In terms of contracts, there is no doubt there is a contract between Mr. Toth and Nominet, and it is clearly a contract which includes the domain name resolution system in issue, including the Dispute Resolution Service Policy, which runs to some 14 clauses, and the Dispute Resolution Service Procedure, which runs to some 19 clauses. It is all governed by the Terms and Conditions which apply as between Mr. Toth and Nominet, which are set out in an exhibit in the evidence before me. Those Terms and Conditions make it clear that the Dispute Resolution Service is binding, (clause 14 of the Terms and Conditions). Also the Terms and Conditions (clause 15) make it clear that Nominet, including the directors, officers, servants and any expert, will not be liable to Mr. Toth, or anyone else, for anything done or not done in connection with any proceedings under the Dispute Resolution Service unless the act or lack of action is shown to have been in bad faith.
28. The relevant provisions of the Policy include the definition of an "Abusive Registration" set out in the definition section at page 3 as follows:

"Abusive Registration means a Domain Name which either:

i. was registered or otherwise acquired in a manner which, at the time when the registration or acquisition took place, took unfair advantage of or was unfairly detrimental to the Complainant's Rights; or

ii. has been used in a manner which has taken unfair advantage of or has been unfairly detrimental to the Complainant's Rights".

The Policy includes clause 2 entitled "Dispute Resolution Service", which reads as follows:

"a. A Respondent must submit to proceedings under the DRS if a Complainant asserts to us, according to the Procedure, that: i. The Complainant has Rights in respect of a name or mark which is identical or similar to the Domain Name; and ii. The Domain Name, in the hands of the Respondent, is an Abusive Registration.

b. The Complainant is required to prove to the Expert that both elements are present on the balance of probabilities.

c. We strongly recommend that both Parties use our guidance and help information, which can be found on our web site."

29. The Policy includes clause 9, which deals with the exclusion of liability of an expert, and clause 10 d, which relates to appeals and states that:

"The operation of the DRS will not prevent either the Complainant or the Respondent from submitting the dispute to a court of competent jurisdiction."

30. The Policy includes clause 11, which refers to paragraph 17 of the Procedure, and clause 12, which provides that:

"[Nominet] will not cancel, transfer, activate, deactivate or otherwise change any Domain Name registration except as set out in paragraph 11 above and as provided for in paragraphs 6.3 or 16 to 19 of our standard terms and conditions of domain name registration."

There is also a clause 13 a. i. and ii. which is relevant.

31. In the Dispute Resolution Service Procedure, the definition of "Abusive Registration" is repeated. In clause 3, the complaint is dealt with. The relevant terms of that are:

Clause (a), which provides:

"Any person or entity may submit a complaint...";

Clause (c), which deals with things a complainant must do and includes (vii), which requires the complainant to tell Nominet:

"whether any legal proceedings have been commenced or terminated"; and

Clause (viii) which provides that the complainant shall:

"state that the Complainant will submit to the exclusive jurisdiction of the English courts with respect to any legal proceedings seeking to reverse the effect of a Decision".

32. I should interpolate that the fact that the complainant in this case is seeking to strike out this action is not a breach of clause (viii) because Ms. Himsworth's submission is not that it is impossible to take proceedings to court. She submits that it is possible, however only under the law as applied in those expert determination cases.
33. In the DRS Procedure Clause 5, dealing with the response, includes in clause 5.c.iv a requirement that the respondent has to notify Nominet about any legal proceedings. There is another impartiality clause at 9.a. The important provisions for the purposes of this decision are clause 17.c, clause 18.i.i and ii and clause 20.a and b. Essentially, what they come to is that in 17(c):

"If the expert makes a Decision that a Domain Name registration should be cancelled, suspended, transferred or otherwise amended, we will implement that Decision by making any necessary changes to our domain name register database after ten (10) Days of that date that the Parties were notified, unless, during the ten (10) following the date that the Parties were notified we receive from either Party:

i. an appeal or statement of intention to appeal complying with paragraph 18, in which case we will take no further action in respect of the Domain Name until the appeal is concluded; or

ii. official documentation showing that the Party has issued and served (or in the case of service outside England and Wales, commenced the process of serving) legal proceedings against the other Party in respect of the Domain Name. In this case, we will take no further action in respect of the Domain Name unless we receive:

A. evidence which satisfies us that the Parties have reached a settlement; or

B. evidence which satisfies us that such proceedings have been dismissed, withdrawn or are otherwise unsuccessful."

34. In my judgment, pulling that all together, it is clear that the contract between Mr. Toth and Nominet includes the contemplation that it is possible in certain circumstances, even once the expert determination and the appeal procedure have come to an end, for the parties to take some sort of dispute to the court and for that dispute to lead to the conclusion of the expert's determination or the appeal should be overturned as a practical matter. That is essentially what these provisions amount to.
35. Mr Turner also submitted, for what it is worth, that not only is this contract binding on Mr. Toth and on Nominet, but, having submitted themselves to the procedure, it is also binding on Emirates on the principle in the Mudhook regatta case Clarke v Dunraven [1897] AC 59. It does not seem to me to matter but in my judgment, it is probably correct.

The construction of the contract

36. The first question then is: What is the true construction of these contracts or this contract? Mr. Turner relies on the case of Prince v Prince Sports Group Limited [1998] FSR 1. This was a decision of Neuberger J, as he then was. Mr Turner says that it informs the policy behind the Nominet rules. Essentially, that was an action in which a party, a registrant, had a domain name and had been the subject to proceedings in the United States in relation to that domain name. The US proceedings had concluded that the domain name was something which needed to be transferred to the defendants.
37. What Neuberger J was concerned with was a threats action. He concluded in the case before him that the threats were unjustified. However, he also made the following observations clear at page 39 of the report:

"I find it very hard to believe that any U.S. court, or indeed NSI, would conclude that any relief granted to the plaintiff against the defendant under section 21 by this court was based on anything other than the fact that the principal letter, on its true construction, constituted an unjustified threat of proceedings against the plaintiff on the ground that the use of the word 'PRINCE' by the plaintiff constituted a breach of the defendant's U.K. registered trade mark. I take the opportunity of emphasising that anything I decided in this judgment, and any order made as a result of this judgment, goes, and indeed can go, no further than that. If the defendant is genuinely concerned about the possibility of the effect of any order being given a different, and wider, interpretation, I would listen sympathetically to any variation of the terms of the order as sought by the plaintiff. It is obviously quite possible for an English court to reach the conclusion that the principal letter, in so far as it constitutes a threat of infringement proceedings in relation to the defendant's U.K. registered trade marks is an unjustified threat, and for a U.S. court to reach the contrary conclusion so far as the defendant's U.S. registered trade marks are concerned."

38. It seems to me that what is clear is that this not a case which assists in deciding the true interpretation of the Nominet policy. What Neuberger J (as he then was), was making very clear was that he was deciding a threats action and that that did not and should not be taken as having any wider significance than the issue that was before him. In my judgment, it does not help in construing the Nominet policy.
39. Mr. Turner then relied on some further matters. He relied on clause 4K of the ICANN UDRP which applies in many other countries of the world but not to Nominet. It undoubtedly has a similar provision in it, whereby, administrative decisions are then left for period to allow the parties to take the dispute to court. Mr. Turner referred me to a number of decisions in the United States where it is clear that, partly as envisaged by clause 4K of the UDRP, parties can take proceedings before the U.S. court in order to decide who is entitled to the domain name in question. The decisions were Dan Parisi v Netlearning Inc. 139 F Supp 2d 745 (ED Virginia, 2001) and Dluhos v Strasberg (2003) 321 F 3d 365 (CA3, 2003). Again, in my judgment it is not easy, or I should say to be more accurate, not safe or correct to base my decision on the U.S. cases. What is clear is that in the United States there is a specific legislative scheme for deciding who is entitled to a domain name and for that decision to be made in the court.
40. Mr. Turner says that this also provides background to the Nominet policy and helps his submission that the Nominet policy be interpreted in the way that assists him. In my judgment, the position in the United States is sufficiently different from the position in the United Kingdom that I do not accept that is a safe way to proceed in interpreting the Nominet policy.
41. Mr. Turner also refers me to a 1999 report of WIPO, relating to internet domain names. The title of the report is "Management of Internet Names and Addresses: Intellectual Property Issues". The relevant section is from paragraph 137 to at least 151. My attention was drawn to paragraphs 139, 150, and 151. The WIPO report states at paragraph 139:

"The WIPO Interim Report recommended that any dispute-resolution system alternative to litigation that might be adopted for domain name disputes should not deny the parties to the dispute access to court litigation. This recommendation met with the support of virtually all commentators."

And at paragraph 150:

"(i) The procedure should permit the parties to resolve a dispute expeditiously and at low cost.

…

(iv) As indicated above, the availability of the administrative procedure should not preclude resort to court litigation by a party. In particular, a party should be free to initiate litigation by filing a claim in a competent national court instead of initiating the administrative procedure, if this is the preferred course of action, and should be able to seek a de novo review of a dispute that has been the subject of the administrative procedure."

42. In my judgment the WIPO report must have been one of the things which the people setting the Nominet system would have had in mind. In my judgment it does provide some assistance in understanding Nominet's policy.
43. Mr. Turner also referred me to decisions in Canada and Queensland relating to court proceedings which followed on from determinations under the UDRP (Black v Molson Canada, Ontario Supreme Court, B. Wright J, 2002-07-18 and Global Access Ltd v Education Dynamics LLC Supreme Court of Queensland, Applegarth J, [2009] QSC 373). Neither case in my judgment is directly in point, principally because the issue which is before me was simply not live in either Canada or Queensland.
44. It is true to say that in Canada they must have proceeded on the assumption that the court had jurisdiction to make the relevant order, because the order was made, but there does not appear to have been a challenge to the court's jurisdiction.
45. The decision in Queensland relates to security for costs and involves a detailed analysis of the precise legal nature of the proceedings before the court on that occasion. However, again, the issue before the court was not the same as the issue before me. I will not rely on the decisions in Canada and Queensland.
46. In my judgment, the real issue, in this case, is the true construction of the contract between Nominet and Mr. Toth. In particular, the question is: what is the effect of clause 17.c of the Procedure? In my judgment, Clause 17.c of the procedure specifically is intended to, and does, allow for a de novo review of the decision as to who owns a domain name in the court. It is, in my judgment, intended to allow a registrant, who is about to lose their domain name because a complainant has won under the administrative procedure run by Nominet, to come to court for relief, which relief is contemplated to be something which will have the result of stopping the transfer from taking place or saying that it should not take place. In my judgment, the contract neither purports to preclude or limit the court's jurisdiction in any way.
47. There is no term to which I have had my attention drawn which provides in express terms that the determination by the expert or the appeal determination is final or conclusive. In my judgment, Clause 17 indicates quite the opposite. In my judgment, the expert determination case law cited by Ms. Himsworth does not apply in this case.

The court's jurisdiction

48. Clause 17(c) is not intending to and does not create new causes of action. For example, a disappointed complainant might bring an infringement case and a disappointed applicant or a registrant might, if they can, bring a threats action. These provisions in this contract are not intended, as I say, to create new legal rights for the parties. It also means, in my judgment, that this contract does not purport to oust the court's general jurisdiction in relation to declarations, which is governed by CPR part 40 and in particular rule 40.20. Accordingly the court has a jurisdiction to grant a declaration, in this case, because that is something which rule 40.20 expressly permits the court to do.
49. The issue, following on from the cases such as Messier-Dowty v Sabena, and Arrow Generics v Merck is whether, in the exercise of my discretion, the court should do so. I remind myself that this is a strike out at the moment. The question is not whether I should grant a declaration in Mr. Turner's client's favour, the issue is only whether it is possible, at this stage, to say that there is no basis on which I could ever grant a declaration of the kind he is seeking in this case. In my judgment, the real issue is whether a declaration of this kind is capable of being useful to the parties.
50. Ms. Himsworth submits that a threats action brought by a disappointed registrant in a situation like this, cannot lead to a finding which could ever lead to the domain name not being transferred. Ms. Himsworth submits that following the procedure under rule 17(c), if a registrant felt that they had grounds for saying that they did not want the transfer to go ahead because they thought that the decision was wrong, it appears to be possible (and there is no reason why they could not) that they could start a threats action. A threats action will allow for the possibility of a court deciding that the threats were unjustified. This ultimately could allow the court to decide, for example, that the domain name did not infringe or that what was on the website did not infringe the rights holder's trade marks. However, Ms. Himsworth points out that the specific relief available in a threats action includes declaration that the threat is unjustified and submitted that that would not be sufficient to justify non-transfer of a domain name.
51. I do not have to decide whether that submission is right or wrong. It does seem to me that if that submission has merit, if anything it supports the submission of Mr. Turner. If a threats action cannot give the right answer, the court should, in the exercise of its discretion, entertain the grant of declarations of the kind that Mr. Turner is seeking.
52. I also note that, in this particular case, the defendant is submitting that the threats action in this case should be struck out, because the only basis for it is a letter that was written "without prejudice". As a result of the way that we have managed these applications, at the moment I do not have to decide whether that submission is right or wrong. However, it seems to me, if the submission was right, it would mean that a person in the position of Mr. Toth could never start a threats action because, of course, you can only start a threats action if you had a threat made against you. It would seem to me, in those circumstances, the only possible court proceeding which a disappointed registrant could take in respect of the domain name, would be a proceeding for a declaration of the kind that Mr. Turner is seeking.

Floodgates

53. On behalf of her clients, Miss Himsworth submitted that this was a very important question. There was a danger of opening the floodgates to litigation in relation to the domain name policy and the Dispute Resolution System of Nominet. That submission does give me considerable concern, but it seems to me that I do not have sufficient material before me to decide whether that is a good point or not. However, it is a matter which could well come into the exercise of the court's discretion. In my judgment, I am not in a position to say that this declaration should not go forward on that basis. Indeed, Mr. Turner says that looking elsewhere in the world, actually there is no floodgates problem at all. The way in which I propose to deal with the floodgates matter is to invite Nominet to make written submissions, if they wish, in this case, at a Case Management Conference. It does seem to me that the question of the court's discretion is one in which it may well be important to know what Nominet's position is, in relation to cases of this kind.

The juridical basis for this claim

54. Miss Himsworth submitted that I should consider carefully what the juridical basis for this claim is. In my judgment, she is right about that but the answer is straightforward. The juridical basis is a claim for a declaration under rule 40.20. That is that the court has the power to grant declarations to deal with the party's legal rights. It seems to me to be unreal to say, in this case, that Mr. Toth and Emirates do not have a dispute as between them which involves their rights. Ultimately, it is a dispute about their rights to this domain name.

One further matter

55. Before leaving this decision, I should deal with one further matter. The question of declaration (b) was raised by the defendants. Declaration (b) relates to the submission that there is a possible claim by Mr. Toth that one of the members of the Appeal Panel was not actually biased, but at least by the fact that he was a member of a firm of solicitors and, having regard to the solicitor's clients, there was a possible appearance of bias. Under the Porter and Locabail line of authorities, if that had been a court decision then that might vitiate the decision.
56. It seems to me that declaration (b) is a very different kind of declaration from, and a very different circumstance to, the basic question of whether this registration is or is not an abusive registration, which is raised by declaration (a). Apart from anything else, purely as a matter of discretion, it seems to me that, having decided that the court has the jurisdiction to entertain the declaration (a) that Mr. Turner seeks, there is no reason why the court needs to entertain declaration (b). It seems to me that it is a very different position from the previous one. I can say that I cannot imagine circumstances in which, having decided the objective question of whether the registration is or is not abusive, it was a proper or sensible use of the court's time and discretion, to entertain an application to decide the question of bias. It also seems to me that issue (b) is much more akin to a form of an appeal or a review of the decision below. In my judgment declaration (a) is not a proceeding of that kind. This case is to decide an objective question, which is whether or not the registration is or is not an abusive registration under the rules. That is nothing to do with the question of whether the Appeal Panel in this case was properly constituted or not.
57. Accordingly, I will dismiss the application to strike out declaration (a). I will strike out declaration (b) and I will stay declarations (c) to (f).