This country-specific Q&A provides an overview of Litigation laws and regulations applicable in Bermuda.
What are the main methods of resolving disputes in your jurisdiction?
In addition to litigation, which will be discussed in further detail below, parties can seek to resolve legal disputes in Bermuda through mediation or arbitration. Domestic arbitrations are governed by the Arbitration Act 1986 and international commercial arbitrations with a Bermuda seat are governed by the Bermuda International Conciliation and Arbitration Act 1993, which gives effect to the UNCITRAL Model Law on International Commercial Arbitration. The 1993 Act also provides a framework for a process referred to as “conciliation” which involves the parties to an international arbitration agreement appointing a “conciliator” to assist them “in an independent and impartial manner in their attempt to reach an amicable settlement of their dispute”.
The parties are of course also able to directly negotiate by way of “without prejudice” correspondence, which is generally inadmissible as evidence at any trial where such correspondence is intended to be a genuine attempt to settle the dispute.
What are the main procedural rules governing litigation in your jurisdiction?
The Rules of the Supreme Court of Bermuda 1985 (as amended) (the “RSC”) govern proceedings in the Supreme Court (the court of first instance for matters exceeding BD$25,000 in value). Appeals to the Court of Appeal for Bermuda are governed by the Rules of the Court of Appeal for Bermuda 1965.
The Judicial Committee of the Privy Council (“JCPC”) is the Court of final appeal for Bermuda. Its proceedings are governed by the Judicial Committee (Appellate Jurisdiction) Rules 2009 (as amended) and associated Practice Directions.
What is the structure and organisation of local courts dealing with claims in your jurisdiction? What is the final court of appeal?
The court system in Bermuda consists of the Magistrates’ Court, which deals with lower value civil and commercial claims (up to BD$25,000), the Supreme Court, which deals with claims above that value. Appeals from the Magistrates’ Court generally lie in the first instance to the Supreme Court. Appeals from the Supreme Court are made to the Court of Appeal. Appeals from the Court of Appeal lie to the JCPC.
The Bermuda Supreme Court has a specialist Commercial Court division.
How long does it typically take from commencing proceedings to get to trial in your jurisdiction?
Less complex matters in the Magistrates’ Court can expect to reach trial within a few months depending on the court’s calendar. The parties to higher value proceedings in the Supreme Court can expect to reach trial within a year, however, this time period may be substantially more in circumstances where the proceedings are complex, for example where there are multiple parties or the proceedings are delayed by complex interlocutory applications. Our experience is that most cases begun by writ will take more than a year to get to judgment.
Are hearings held in public and are documents filed at court available to the public in your jurisdiction? Are there any exceptions?
Court proceedings in Bermuda are generally open to the public. Furthermore, the public has the right, under the Supreme Court Records Act 1955, to access the court’s file relating to any proceedings. These rights are subject to some exceptions.
It is possible to apply to the court for an order that all proceedings be held in private and that the court file be sealed, however, such applications tend to be successful only when the public’s interest in “open justice” is outweighed by private interests of the party seeking confidentiality. This is perhaps most common in cases involving minors or sensitive matters relating to trusts where the court concludes that little public interest is served by the relevant matter being heard in public.
What, if any, are the relevant limitation periods in your jurisdiction?
Limitation in Bermuda is governed by the Limitation Act 1984. Claims based on simple contract or tort attract a 6 year limitation period which runs from the date of breach of contract or the date of breach of duty in tort, which generally means the date when damage or loss was incurred by the Plaintiff. Limitation in defamation claims runs from the date of publication.
Contracts made under seal attract a 20 year limitation period. The 20 year limitation period also applies to claims based on recovery of land, the enforcement of arbitration awards, and claims concerning monies secured by a mortgage or a charge.
Limitation is not an automatic bar to a claim and must be raised as a defence by the defendant, albeit in clear cut cases, claims which have fallen foul of limitation could be vulnerable to a summary judgment and/or strike out application.
What, if any, are the pre-action conduct requirements in your jurisdiction and what, if any, are the consequences of non-compliance?
While there are no particular requirements as to formalities to be completed prior to the issuing of proceedings, it is prudent prior to doing so to write to the intended defendant/s by way of a letter before action and inviting a written response, if there is time in which to do so.
The RSC was amended in 2006 to add a new Order 1A, which contains the overriding objective obligation on parties. The overriding objective ensures dealing with cases justly, so far as practicable, ensuring that parties are on an equal footing, saving expense, dealing with cases proportionately, expeditiously and fairly, and allotting cases to the appropriate share of the court’s resources. Accordingly, parties can be expected to engage, and narrow issues, where possible.
The court is entitled to consider the conduct of the parties when it comes to the issue of costs, and a party that has behaved unreasonably may find themselves at a costs risk.
How are proceedings commenced in your jurisdiction? Is service necessary and, if so, is this done by the court (or its agent) or by the parties?
The RSC provide that civil proceedings in the Supreme Court may be commenced by writ, originating summons, originating motion, or petition. Actions commenced by writ are most common in relation to commercial claims, and indeed, any claim based on a breach of contractual duty, negligence (or other torts), fraud and/or patent infringement must be begun by writ.
Where proceedings are unlikely to involve any substantial dispute of fact, they can be begun by originating summons. This applies where for example the dispute concerns the interpretation or construction of an agreement, or other instrument, or where a discrete question of law arises.
Proceedings may be begun by originating motion or petition if this is authorised by any act or by the RSC. Examples include petitions to wind-up a company, and proceedings for relief for minority shareholder oppression.
Under the RSC, all originating proceedings must be personally served on a defendant. If the defendant is out of the jurisdiction, then an application is necessary for the court’s leave to serve out.
Once proceedings have been issued at the court registry, the plaintiff has up to a year to serve the same on the defendant. This time period can be extended with court’s permission.
Service on a company is made at its registered office by leaving a copy of the proceedings there. Service on an individual generally consists of them receiving a copy of the proceedings personally, albeit it is possible to seek an order from the court for substituted service which allows service by an alternative method (for example by email). This is most relevant where a plaintiff encounters difficulty in affecting service on a defendant.
If a defendant is legally represented, then the attorney can accept service on its behalf.
Service is the responsibility of the issuing party, not the court.
How does the court determine whether it has jurisdiction over a claim in your jurisdiction?
In cases where a defendant is not resident in Bermuda, then an application for permission to serve outside the jurisdiction will need to be made. The categories of case where such permission may be granted, and therefore where the Bermuda courts will exercise jurisdiction over a given claim, are set out at Order 11 of the RSC . Possible grounds under Order 11 include for example where the claim is brought in respect of a contractual breach committed within the jurisdiction or where for example the claim is founded in tort and the damage was sustained, or resulted from an act committed within the jurisdiction.
The court will also consider whether the claim has a real, as opposed to fanciful prospect of success, whether there is a good arguable case that the claim falls within one of the heads in Order 11, and further, the plaintiff must establish that, in all the circumstances, Bermuda is clearly or distinctly the appropriate forum for the trial of the dispute and that the court ought to exercise its jurisdiction to permit service out of the jurisdiction.
How does the court determine which law governs the claims in your jurisdiction?
Bermuda is not a signatory to the Rome Convention, and as such common law principles will govern the question of what law should govern a contract without a choice of law clause. Where the parties have not indicated any clear intentions in terms of choice of law and this cannot be inferred, then the common law principles provide similar guidance to the Rome Convention, in essence encouraging the court to determine the law governing the contract by reference to the system of law with which the contract has its closest connection.
In tort claims, the position will often be clearer as the applicable law will generally be held to be the place where the harmful act was committed, which dovetails with the rules regarding service out of the jurisdiction in claims involving a tortious act.
In what circumstances, if any, can claims be disposed of without a full trial in your jurisdiction?
There are four main ways in which issued proceedings can be disposed of without a full trial in Bermuda:
Judgment in default, which is available to the plaintiff, by application to the court in circumstances where a defendant fails to enter an appearance and/or a defence statement. Similarly, a defendant may apply for an action to dismissed if a statement of claim is not served in accordance with the RSC (generally 14 days from the date on which the defendant enters an appearance).
Any party may make an application for summary judgment on the basis that there is no issue or question in dispute which ought to be tried in respect of a claim, and there is no other reason for a trial of the claim to take place.
The court may, either further to an application or on its own volition, at any stage of the proceedings make an order to strike out any pleading or the indorsement of any writ in the action, or anything in any pleading or in the indorsement, on the grounds that such a pleading discloses no reasonable cause of action or defence, as the case may be. Further, if any pleading is scandalous, frivolous or vexatious, or may prejudice, embarrass or delay the fair trial of the action, or it is otherwise an abuse of the process of the court, then the court may order the action to be stayed or dismissed or judgment to be entered accordingly, as the case may be.
Finally, in an action begun by writ, the plaintiff can discontinue the action or withdraw any part of its claim against any defendant without the leave of the court so long as the discontinuance takes place no later than 14 days after service of the defence. Similarly, a defendant can discontinue a counterclaim or withdraw any part of such a claim so long as this is done no later than 14 days after the defence or counterclaim. If, however, a party discontinues or withdraws an action, it is likely they will be held responsible for the other party’s costs. Later in the proceedings, parties can withdraw or discontinue claims with the consent of all parties in an action begun by writ, with other originating proceedings requiring the leave of the court.
What, if any, are the main types of interim remedies available in your jurisdiction?
An applicant can apply for a number of interim remedies pursuant to Order 29 of the RSC. These include for example; injunctions (including freezing or “Mareva” injunctions), search orders (also known as “Anton Piller” orders), interim preservation of property which is the subject matter of a cause of action, the taking of samples, the sale of perishable property and the recovery of personal property which is the subject of a lien. “Norwich Pharmacal” orders (orders for disclosure of documents or information against a third party) are also available
Perhaps one of the most commonly sought interim remedies is an injunction, which may be granted by the court in all cases where it appears that it is “just and convenient that such order should be made” and more generally in accordance with the principles set down in American Cyanamid v Ethicon  AC 396. The court has broad discretion in relation to granting injunctions and any such order may be made either unconditionally or upon such terms as the court thinks just.
Interlocutory hearings are generally heard in chambers. The plaintiff may not make such an application before the issue of a writ or originating summons, except in very urgent cases, and in such cases the injunction may be granted on terms providing for the issue of the writ or summons and other such terms as the court thinks fit.
After a claim has been commenced, what written documents must (or can) the parties submit in your jurisdiction? What is the usual timetable?
In relation to an action commenced by writ, as part of bringing its claim, unless the statement of claim is indorsed on the writ itself, the plaintiff is required to serve its statement of claim before the expiration of 14 days after the defendant enters an appearance. Order 18 of the RSC governs the general contents of pleadings, with Order 72 providing additional stipulations for actions in the Commercial Court. In summary, every pleading must contain, and only contain, a statement in summary form of the material facts on which the party pleading relies upon for its claim or defence. The pleadings should not contain the evidence by which those facts are to be proved. The relief or remedy sough must be specifically stated.
The defendant is required to serve its defence within 14 days after the time limited for filing an appearance, or after the statement of claim is served on him, whichever is the later.
Depending on the contents of the defence, and whether any counterclaim is pleaded, the plaintiff has 14 days to file a reply and/or a defence to counterclaim following the service of the defendant’s defence and/or counterclaim.
No further pleadings may be filed without the leave of the court.
What, if any, are the rules for disclosure of documents in your jurisdiction? Are there any exceptions (e.g. on grounds of privilege, confidentiality or public interest)?
The RSC require the parties to disclose all documents which are or have been in their possession, custody or power relating to the matters in question in the action. The parties to an action commenced by writ are required to mutually exchange a list of all documents relating to matters in the action within 14 days of the date of close of pleadings, which is deemed to be at the expiration of 14 days following service of the reply, the defence to counterclaim, or if neither a reply nor a counterclaim is served, and the expiry of 14 days after the defence.
Parties are able to set out documents over which privilege is claimed and which are therefore privileged from production and inspection. The grounds for asserting privilege include any documents: (a) protected by legal professional privilege; (b) documents protected by litigation privilege; (c) documents tending to incriminate or expose to a penalty the party who would produce them; (d) documents protected by without prejudice privilege; and (e) documents privileged on the grounds of public policy.
How is witness evidence dealt with in your jurisdiction (and in particular, do witnesses give oral and/or written evidence and what, if any, are the rules on cross-examination)? Are depositions permitted?
Order 38 or the RSC states that the general rule is that witnesses of fact at a final hearing should give their evidence via oral examination in open court. This general rule can be displaced by the court by ordering, at a pre-trial review or directions hearing, that witness statements are to be produced and exchanged. Generally, in a Commercial Court trial, Order 72 of the RSC provides evidence in a witness statement is put into evidence by the witness and supplemental examination in chief is allowed, with the witness then tendered for cross examination by the defendant. The witness may then be re-examined by the plaintiff.
In terms of depositions, under Order 39, the Court has the power to order that an examination under oath before a judge be taken where it appears necessary for the purposes of justice to do so.
Is expert evidence permitted in your jurisdiction? If so, how is it dealt with (and in particular, are experts appointed by the court or the parties, and what duties do they owe)?
Under the RSC, Order 38, the leave of the court is required prior to any party being permitted to adduce expert evidence. Either party may seek their own experts, or they may agree on a joint expert. Such evidence is contained in a statement, and the expert can then attend trial for the evidence as set out in their report to be submitted as their evidence in chief. Similarly to factual witnesses, the expert’s testimony will be subject to cross-examination and re-examination.
Bermudian case law establishes that the expert will owe an overriding duty to assist the court that is independent of any duty to the paying party.
Can final and interim decisions be appealed in your jurisdiction? If so, to which court(s) and within what timescale?
There are generally rights of appeal against both interim and final decisions, albeit in relation to interim or interlocutory orders leave will usually be required. Such leave can be obtained from the lower court, or from the appeal court in circumstances where the lower court refuses permission. In summary, such leave will only generally be granted where the appeal would have real prospects of success, or there is some other compelling reason.
The timescales for bringing such an appeal are as follows: (i) 7 days in the case of an appeal from an interlocutory order from the date on which leave to appeal is granted (the applicant has 14 days to apply for such leave where it is required); (ii) 6 weeks calculated from the date on which the final judgment or order appealed against was signed, entered or otherwise perfected.
Any application for leave to appeal from the Bermuda Court of Appeal to the JCPC must be brought within 21 days of the date of the judgment to be appealed from is given or order made.
What are the rules governing enforcement of foreign judgments in your jurisdiction?
A party wishing to enforce a judgment obtained in a jurisdiction outside Bermuda can rely either on the Judgment (Reciprocal Enforcement) Act 1958, or if the judgement is from a country which is not included within the ambit of that legislation then common law principles will apply.
Under the 1958 Act, together with the Judgments Extension Order 1956 and the Judgment (Reciprocal Enforcement) Australia Order 1988, Bermuda has reciprocal enforcement regimes with a number of countries including the United Kingdom, many of the Caribbean jurisdictions and Australia. This regime does not however apply to a significant number of other large commercial jurisdictions including the United States.
Where the judgment falls within the ambit of the 1958 Act, then the judgment needs to be registered by way of an application supported by an affidavit exhibiting the judgment in question confirming that the judgment is one to which the 1958 Act applies; that there was no fraud practiced on the court to obtain the judgment; that the person seeking registration is the person in whom the rights under the foreign judgment are vested; that the defendant received notice of the foreign proceedings giving rise to the judgment; and that the foreign court had the jurisdiction to make the judgment it did.
The common law principles which govern non-1958 Act scenarios are complex, but in essence a party looking to enforce such a judgment in Bermuda will need to file formal pleadings at the Supreme Court on the grounds that the debt obligation created by the foreign judgment forms the basis of the cause of action. In essence, the party seeking to enforce the judgment will then apply for summary judgment relying on the existence of the foreign judgment as determinative of the issues between the parties under the res judicata principle, or issue estoppel.
Can the costs of litigation (e.g. court costs, as well as the parties’ costs of instructing lawyers, experts and other professionals) be recovered from the other side in your jurisdiction?
On the conclusion of proceedings in Bermuda, the court will usually follow the principle of “loser pays”, in other words the losing party will pay the legal costs of the winning party. This will include court fees, legal costs, and the costs of any experts. The court has a broad discretion in relation to costs and can make alternative orders. The court can for example take into consideration the conduct of the parties generally, and any offers of settlement made, either by way of a payment into court or by way of a written offer.
The court can also make “issue-based” costs awards reflecting the parties’ respective successes and failures in the proceedings.
Costs are either awarded on the “standard basis”, where the court will allow a reasonable amount in respect of all costs reasonably incurred and any doubts being resolved in favour of the paying party, or on the “indemnity basis”, where all costs are allowed except insofar as they are of an unreasonable amount or have been unreasonably incurred and any doubts are to be resolved in favour of the receiving party.
What, if any, are the collective redress (e.g. class action) mechanisms in your jurisdiction?
Representative proceedings are possible in Bermuda where numerous persons have the same interest in any proceedings. In essence, in such cases the court will permit one or more of the members of the group to “represent” the whole group. A plaintiff wishing to bring proceedings by or against a group can do so without leave, but should seek the court’s approval as soon as possible thereafter. The most common form of representative action is perhaps a shareholder bringing an action on behalf of himself and his fellow shareholders, not himself alone. The relief sought is in this way beneficial to all the persons that the plaintiff proposes to represent.
What, if any, are the mechanisms for joining third parties to ongoing proceedings and/or consolidating two sets of proceedings in your jurisdiction?
Third parties can be joined to an action by a defendant wishing to pass on or share liability to that third party. Similarly, a plaintiff subject to a counterclaim, or indeed a third party subject to a third party notice, can claim a contribution or indemnity against another third party not already a party to the proceedings by filing and serving a third party notice.
Service of such a notice has the effect of joining the third party to the proceedings, and that third party than has the same rights and timescales in terms of filing a defence and/or counterclaim, or indeed any further third party notices.
Joinder is permitted by the court in circumstances where if separate actions were brought by or against each of the parties, some common question of law or fact would arise in all the actions, and all rights to relief claimed in the action (whether they are joint, several or alternative) are in respect of or arise out of the same transaction or series of transactions.
Are third parties allowed to fund litigation in your jurisdiction? If so, are there any restrictions on this and can third party funders be made liable for the costs incurred by the other side?
Litigation funding in Bermuda is a grey area. We usually advise that litigation funding is not possible in most circumstances. Maintenance (third party litigation funding) and champerty (third party litigation funding with a financial benefit to the third party) remain common law torts in Bermuda. Unlike most modern jurisdictions there is no Bermuda legislation abolishing or limiting the same. However, the common law has historic exceptions including one for ‘insolvency’ (whereby liquidators seek reasonable funding to pursue claims) and ‘access to justice’ (where third party funding is required for resolution of a dispute before a court). The Bermuda Courts have not produced any substantial guidance on the subject, but it has refused to strike down litigation funding agreements that were subject to challenge before it and stated that the Bermuda constitution provides a “constitutionally protected right of access to the court” and went so far as to suggest that “such funding agreements should be encouraged rather than condemned”.
If the court can find that proceedings were brought for the benefit of a particular third party and/or that third party has in practical terms been controlling the proceedings then costs orders can be made against that third party.
What has been the impact of the COVID-19 pandemic on litigation in your jurisdiction?
The COVID-19 pandemic caused the Supreme Court to temporarily close for a short period, and thereafter hearings were predominantly held virtually. Court services are now back on a full service basis.
During the pandemic, we believe that less disputed claims and actions were issued at the Commercial Court, with parties preferring to explore settlements and negotiations given the restriction of court services.
COVID-19 related restructurings and insolvencies have been before the Commercial Court. We believe that the full impacts of the pandemic have not yet made it through to the Commercial Court, and we expect more COVID-19 related restructurings and insolvencies in due course.
What is the main advantage and the main disadvantage of litigating international commercial disputes in your jurisdiction?
Bermuda has a specialised Commercial Court, created and maintained for litigating international commercial disputes. The Commercial Court has allocated judges, specialised and experienced in international commercial disputes. The Commercial Court results in a more efficient service for parties. Decisions and judgments of the Commercial Court can in most circumstances be appealed to the JCPC (which comprises the same judges as the UK Supreme Court).
In Bermuda, parties can only be represented by Bermudian attorneys, including before the Commercial Court. There are not any usual exceptions for lawyers from other jurisdictions to be admitted on a case by case basis (apart from English Kings’ Counsel, if the matter is sufficiently complex or novel).
What is the most likely growth area for commercial disputes in your jurisdiction for the next 5 years?
Bermuda has a large growing base of long-term re/insurers – companies that specialise in life insurance or reinsurance. Life re/insurance in Bermuda is only projected to be larger in the future. As such, we expect commercial disputes in life re/insurance to be the most likely area of growth over the next 5 years.
What, if any, will be the impact of technology on commercial litigation in your jurisdiction in the next 5 years?
Bermuda closely follows the UK and US in terms of utilising specialised technology in commercial disputes. The Commercial Court has already implemented e-discovery protocols, and paperless trials, in some cases. We expect the Bermuda Commercial Court to continue to adapt and utilise technological advances in commercial litigation.
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