Flux des sites DIP

July 19, 6pm – 8pm

I reviewed Tanchev AG’s Opinion in C-88/17 Zurich Insurance v Metso here. The CJEU held last week. Like its AG, it upholds the place of dispatch of the goods as being a place of performance under Article 7(1)b, second indent Brussels I Recast. At 21-22: ‘When goods are carried, it is at the place of dispatch that the carrier has to perform a significant part of the agreed services, namely to receive the goods, to load them adequately and, generally, to protect them so that they are not damaged. The incorrect performance of the contractual obligations related to the place of dispatch of goods, such as, inter alia, the obligation to load goods adequately, may lead to incorrect performance of the contractual obligations at the place of destination of the carriage.’

The AG pondered, and rejected, the many intermediate places where the transport was carried out, as places of performance. The Court itself does not entertain this suggestion but clearly sides with the AG in not wanting to expand the list of possible fora to extensively.

Geert.

(Handbook of) EU Private International Law, 2nd ed. 2016, Chapter 2, Heading 2.2.11.1

The new issue of “Rabels Zeitschrift für ausländisches und internationales Privatrecht – The Rabels Journal of Comparative and International Private Law” (RabelsZ) has now available. It contains the following articles:

Lord Reed, Comparative Law in the Supreme Court of the United Kingdom

Peter Mankowski, Über den Standort des Internationalen Zivilprozessrechts -Zwischen Internationalem Privatrecht und Zivilprozessrecht (International Procedural Law: Between Choice of Law and Procedural Law):

International procedural law is the link and the intermediary between choice of law and procedural law. Over the last decades it has developed into a fully grown sub-discipline of its own and of equal rank as choice of law. In fact, for practical purposes it has become even more important than choice of law. International procedural law benefits from its position in the middle and enjoys the best from its two neighbouring worlds of choice of law and procedural law.

Susanne Lilian Gössl, Anpassung im EU-Kollisionsrecht (Adaptation in EU Private International Law):

Adaptation or adjustment has to date received little general attention in EU private international law (EU PIL) despite this tool being of high importance in maintaining the coherence between the EU PIL system and national law. The Brussels Ia Regulation, the Succession Regulation and the Matrimonial/Registered Partnership Property Regimes Regulation explicitly provide for the tool of adaptation. Nevertheless, those provisions only deal with one certain category of that tool, what is termed transposition. In general, adaptation refers to the judge’s discretion to deliberately deviate from a rule in an exceptional case in which two different national laws apply in juxtaposition and the combined application could lead to a contradictory result intended by neither of the two national systems. Adaptation diminishes or eliminates those contradictions. The judge’s discretion to adapt national and EU rules implicates questions about the relationship between EU and Member State competence. The present analysis is the first to address this topic comprehensively. It develops a system to decrease contradictions between EU PIL and national law. As the EU PIL system is still only fragmentary, the analysis is twofold. First, the article analyses the necessity, requirements and means of adaptation in a case that is governed by two EU PIL rules. Second, the article analyses whether the outcome changes if the applicable law is determined by one EU PIL rule and one national PIL rule.

Alexander Hellgardt, Das Verbot der kollisionsrechtlichen Wahl nicht-staatlichen Rechts und das Unionsgrundrecht der Privatautonomie (Fundamental Right of Party Autonomy and the Prohibition Against the Choice of Non-State Law):

Choice of law is a cornerstone of European private international law. However, existing secondary law continues to restrict the choice to state law, excluding non-state law regimes like the Principles of European Contract Law, the UNIDROIT Principles of International Commercial Contracts or detailed standard-form contracts. This article tests the restriction against the principle of party autonomy, which is shown to be a European fundamental right. Party autonomy encompasses the right to choose nonstate law regimes in international cases. Any restriction on the choice of non-state law regimes, therefore, needs to be justified. Where private international law does not impose any restrictions on the choice of law, as is the case in the choice of contract law between commercial parties, there is no apparent justification for excluding the choice of non-state law regimes. Hence, European secondary law has to be interpreted in the light of the fundamental right of party autonomy. This allows commercial parties to choose non-state contract law regimes for their international transactions.

Harald Baum, Andreas M. Fleckner & Mihoko Sumida, Haftung für Pflicht-verletzungen von Börsen – Deutschland und Japan im Vergleich (Liability for Trading Irregularities at Stock Exchanges):

It appears from public records that no German stock exchange, exchange operator, or host state has ever been held liable by a court for trading irregularities at the exchange (such as clearly erroneous executions). The Tokyo Stock Exchange, in contrast, was ordered to pay damages of almost eleven billion yen (roughly 80 million euros) following the Mizuho case. This paper discusses how the issues raised by the Mizuho case would have been handled under German law and compares the results with the decisions of the courts in Japan.

There are in fact many differences between Environment Protection Authority v Grafil Pty Ltd; Environment Protection Authority v MacKenzie [2018] NSWLEC 99 and the CJEU’s Palin Granit; and the regulatory context in NSW is quite different from the EU’s. My title therefore is a crowd pleaser rather than legally sound. Yet some of the issues are similar, hence justifying inclusion in the comparative environmental law /waste law binder (and a good teaser for the W-E).

Samantha Daly and Clare Collett have excellent as well as extensive analysis here and I am happy mainly to refer.

Defendants received materials from recycling depots operated by skip bin companies in Sydney. These materials were recovered fines which had been processed and recycled from building and demolition waste, for which there was no market for re-sale at the time (due to the high volumes of such material produced by the recycling industry). This material was trucked to the Premises by transporters from the recyclers and placed in mounds or stockpiles on the Premises.

Was there a stockpile of ‘waste’? Palin Granit considers similar issues in para 36 in particular.

Geert.

The Faculty of Law at the University of Mannheim is looking for a research fellow (akademische Mitarbeiterin / akademischer Mitarbeiter) at the Chair for Private Law, International and European Business Law (Prof. Dr. Moritz Renner) on a part-time basis (50 %, E 13 TV-L) as of 1 September 2018 or later.

His/her tasks will include supporting the chairholder in research and teaching, especially in the areas of conflict of laws, company law, banking law, and foundations of law.

The research fellow will be given the opportunity to conduct his/her own Ph.D. project under the supervision of the chairholder. The successful candidate holds a first law degree (Erste juristische Prüfung or equivalent) above average (at least “vollbefriedigend”). A very good command of German and English is required, further language skills will be an asset.

The position will be paid according to the salary scale E 13 TV-L. The contract period will be limited according to the Wissenschaftszeitvertragsgesetz.

The University of Mannheim aims at increasing the number of women in academia. Therefore, applications of qualified women are particularly welcome. Candidates with disabilities will be given preference in case of equal qualification.

If you are interested, please send your application (cover letter in German, CV, all relevant documents) by 31 July 2018 to: Professor Dr. Moritz Renner, Universität Mannheim, Lehrstuhl für Bürgerliches Recht, Internationales und Europäisches Wirtschaftsrecht, Schloss, D-68131 Mannheim, LS11@jura.uni-mannheim.de

The job advert in full detail is available here.

[2018] SGHCR 8 Ermgassen v Sixcap Financials to my knowledge is the first recognition and enforcement by any court under the 2005 Choice of Court Convention. Together with the 28 EU Member States (and the EU itself), Singapore, with Mexico, are the 30 States for which the Convention has entered into force.

In his decision for the High Court, Colin Seow AR recognises a High Court ex parte summary judgment, taking the process to the Hague motions: whether the issue is civil and commercial; whether choice of court was concluded in favour of the courts having issued the judgment; and pointing to the UK’s membership of the Convention and to counsel for the plaintiff having been heard at the London High Court hearing: this makes the judgment one on the merits, not just a judgment in absentia (of the defendant: a Singapore-domiciled company). Of note is Seow AR’s flexible approach to the requirement to produce certified copies of the judgment (at 23 ff).

Geert.

On 19-20 November 2018, the conference ‘Challenge Accepted! Exploring Pathways to Civil Justice in Europe’ will take place at the Erasmus School of Law in Rotterdam (under the ERC project Building EU Civil Justice). It will focus on how (1) the use of artificial intelligence in dispute resolution, (2) the privatisation of justice and the multiplication of alternative dispute resolution schemes, (3) the increased possibility of self-representation, and (4) court specialisation, in particular international commercial courts, influence the civil justice system. The panel descriptions are available here.

The full program with a great line-up of speakers and information on registration will follow soon.

A special call for applications for a one-year postdoctoral fellowship aimed at threatened researchers from developing countries (one or two bursaries can be awarded)

The details of the fellowship conditions are available on the web site at the following address:
https://uclouvain.be/en/research/news/call-for-applications-for-one-year-postdoctoral-fellowships.html

The deadline for submitting the application is August 31, 2018 at noon.

Advocate-General Bot opined on 4 July 2018 in the case of C-308/17 Leo Kuhn, domiciled at Vienna, who had purchased through an Austrian bank, Greek sovereign bonds. Pursuant to a forced exchanged /haircut carried out by Greece in March 2012, the bonds were replaced with new bonds with a lower nominal value. Mr Kuhn sued to have the initial borrowing terms enforced.

The Advocate-General is of course aware of the similarities with Fahnenbrock – in which he himself had also opined but was not followed by the Court. He first of all points out the similarities between the service Regulation and the Brussels I Recast (both e.g. limiting their scope of application to ‘civil and commercial’ matters), however also flags the specific recitals (in particular: recital 12) suggesting that in the context of the services Regulation the analysis needs to be done swiftly hence only cases which prima facie fall outside the scope of application (including where they manifestly (see the dictum of Fahnenbrock and para 50 of the AG’s Opinion in Kuhn) are not covered by that Regulation.

Coming next to the consideration of the application of ‘civil and commercial’, the facts of this case reflect very much the hybrid nature of much of sovereign debt litigation. In my view yes, the haircut took place within the wider institutional nature of Greece’s debt negotiations with the EU. Yet the ‘collective action clause’ (CAC) which was not part of the original terms and conditions (there was no CAC in the original lex causae, Greek law, but there is one in the newly applicable lex causae, English law: at 63 of the Opinion), was negotiated with the institutional holders of the bond and crammed down the minority holders like Mr Kuhn (at 66). The AG suggest that this does not impact on the qualification of the changes being ‘immediate and direct’, this being the formula employed by the Court in Fahnenbrock.

I am not so sure of the latter but it will be up to the CJEU to decide.

The Advocate General note bene subsequently ‘completes the analysis’ in case the CJEU disagrees with this view, and finds that if the issue is civil and commercial, it can be litigated under Article 7(1)’s rule on special jurisdiction for contractual obligations (the AG at para 88 ff distinguishes the case from C-375/13 Kolassa (in which the CJEU saw no contractual bond between the issuer of the bonds and the acquirer on the secondary market), the obligation at issue, he suggests, having to be performed in Greece. As for the latter element, the Advocate General does refer for the determination of the place of performance to the initially applicable law: Greek law, leaving the later lex causae, English law, undiscussed.

Whether the Court will follow the AG remains of course to be seen.

Geert.

The decision is available here and further documentation is available in the following blog: http://www.scotusblog.com/case-files/cases/animal-science-products-inc-v-hebei-welcome-pharmaceutical-co-ltd/. I would also like to refer to previous posts by fellow editors here and here. The US Supreme Court held that: “A federal court determining foreign law under Federal Rule of Civil Procedure 44.1 should accord respectful consideration to a foreign government’s submission, but the court is not bound to accord conclusive effect to the foreign government’s statements.”

In a nutshell, the US Supreme Court said that the weight to be given to foreign government statements depends on the circumstances of the case. In particular, it notes that “[t]he appropriate weight [a federal court determining foreign law should give to the views presented by a foreign government] in each case, however, will depend upon the circumstances; a federal court is neither bound to adopt the foreign government’s characterization nor required to ignore other relevant materials. No single formula or rule will fit all cases, but relevant considerations include the statement’s clarity, thoroughness, and support; its context and purpose; the transparency of the foreign legal system; the role and authority of the entity or official offering the statement; and the statement’s consistency with the foreign government’s past positions.”

One thing of note is that the US Supreme Court refers to Société Nationale Industrielle Aérospatiale v. United States Dist. Court for Southern Dist. of Iowa, 482 U. S. 522, which is a very important case in the context of the Hague Evidence Convention.

Marmara University Law School in Istanbul/TURKEY is organizing an international conference on Contractual Issues in Private International Law on 11 October 2018. All the information regarding the application can be found at etkinlik.marmara.edu.tr/contractsinpil

The Spanish version of the 2018 Draft Convention on the Recognition and Enforcement of Foreign Judgments has been made available here.

Peter Hay (Emory University, School of Law, USA) has recently published a new book on Private International Law and Procedure. Published in the Elgar Advanced Introduction Series the author has kindly provided the following (extended) summary:

This book deals with the problems that arise in international litigation in civil and commercial cases. Some are familiar problems – for instance, when does a court have jurisdiction over an out-of-state defendant? – except that the international context adds complexity. Other problems are unique to the settlement of international disputes, for instance, does another country’s law apply to the substance of the case and how does one get a domestic judgment recognized and enforced in a foreign country?

The presentation is problem-oriented and takes a comparative-law approach. The three parts of the book present the principal problems parties face in dealing with cases with an international dimension. The latter may be either parties in different countries dealing with each other or facts or elements of the case that involve more than the state where suit is brought (the forum state).

There are no international law solutions to these problems, despite the name of the subject of this advanced introduction. “Private International Law” is the national law of each country dealing with international cases involving private law subject matters. Answers to the litigation problems identified and discussed in the text may therefore differ somewhat or substantially depending on the national law lens through which these problems are viewed. For this reason, this volume uses a comparative approach.

There are, of course, many nuances in the national laws around the world (see the Encyclopedia of Private International Law). But two main “systems” (again with differences within each) stand out, at least in the Western world: the civil law system, derived and developed from Roman law, which is the basis of much of European, South American and some other law, and the common law that spread from England to the United States, Canada and the British Commonwealth. To narrow things down, this volume compares – in the main, but not exclusively – the law of the European Union as largely representative of civil-law solutions and the approaches followed in the United States for the common law.

It would be a vast, indeed misleading overstatement to say that the systems show evidence of converging. Nonetheless, and with problems and the need for solutions being similar, some solutions do resemble each other. As the Conclusion suggests, European law has made particular strides in evolving a modern Conflicts law, in some respects adopting some of the flexibility that characterizes American law, but doing this in a circumspect and very principled way. Work on a new Restatement in the United States and beginning work in the Hague Conference on Private International Law on a new effort to come up with a multilateral convention on jurisdiction and judgment recognition may result in significant developments in the not too distant future.

I was at the Belgian Parliament yesterday for a hearing on the BIBC, following publication of the Government’s draft bill. For those of you who read Dutch, my notes are attached. We were limited to two pages of comments – the note is succinct.

An important change vis-a-vis the initial version (on which I commented here) is that the Court will now be subject to Belgian private international law (including primacy of EU instruments) for choice of law, rather than being able to pick the most appropriate law (arbitration panel style). That brings the court firmly within Brussels I. Also note my view and references on the Court being able to refer to the CJEU for preliminary review.

Geert.

On 18 June 2018, Professor Dr. Christian Kohler, former General Director at the CJEU and honorary professor for private international law, European civil procedural law and comparative law at the University of Saarbrücken, celebrated his 75th birthday. On this occasion, numerous colleagues and friends both from the CJEU and European academia contributed to a liber amicorum in his honour: Burkhard Hess, Erik Jayme and Heinz-Peter Mansel (eds.), Europa als Rechts- und Lebensraum, Liber amicorum für Christian Kohler, Gieseking Verlag (Bielefeld) 2018; XII and 596 pp.; ISBN: 978-3-7694-1199-7. The volume contains 44 articles (mostly) on private international law in English, French and German (moreover, it features a touching French poem by Catherine Kessedjian). The full table of contents and further information are available at the publisher’s website here.

In C-1/17 Petronas Lubricants, the CJEU held end of June, entirely justifiably, that assigned counterclaims may be brought by the employer in the forum chosen by the employee under (now) Article 20 ff Brussels I Recast to bring his claim. In the case at issue, the employer had only obtained the claim by assignment, after the employee had initiated proceedings.

The Court pointed to the rationale underlying Article 22(1), which mirrors all other counterclaim anchor provisions in the Regulation: the sound administration of justice. That the counterclaim is merely assigned, is irrelevant: at 28:  ‘…provided that the choice by the employee of the court having jurisdiction to examine his application is respected, the objective of favouring that employee is achieved and there is no reason to limit the possibility of examining that claim together with a counter-claim within the meaning of Article 20(2)’ (Brussels I, GAVC).

Evidently the counterclaim does have to meet the criteria recently re-emphasised in Kostanjevec.

Geert.

(Handbook of) EU private international law, 2nd ed. 2016, Chapter 2, Heading 2.2.8.3.

Is it compatible with Article 38(1) Brussels I (and the equivalent provisions in the Brussels I Recast) to apply a time limit which is laid down in the law of the State in which enforcement is sought, and on the basis of which an instrument may no longer be enforced after the expiry of a particular period, also to a functionally comparable instrument issued in another Member State and recognised and declared enforceable in the State in which enforcement is sought?

A preservation order had been obtained in Italy. It had been recognised in Germany. However applicant then failed to have it enforced within a time-limit prescribed by the lex fori executionis.

On 20 June Szpunar AG in C‑379/17 Società Immobiliare Al Bosco opined (Opinion not yet available in English) that the lex fori executionis’ time limits must not obstruct enforcement. Moreover, he suggests that his view is not impacted by the changes to exequatur in the Brussels I Recast, and that his Opinion, based on the effet utile of the Brussels regime, has appeal even outside the case at issue (in which Italian law has a similar proviso).

A small but significant step in the harmonisation process of European civil procedure.

Geert.

(Handbook of) EU Private International Law, 2nd ed. 2016, Chapter 2, Heading 2.2.16

In [2018] EWHC 1670 (Comm) BNP Paribas v TRM, the High Court essentially had to hold on its jurisdiction in the face of competing choice of court clauses in an ISDA MAster Agreement (the courts of England; and lex contractus English law) and the attached Financing Agreement (the courts of Turin).

Knowles J dissected the agreements in relation to the claims made by the parties (again highlighting the relevance of formulation of claims): at 27: where, as here, there is more than one contract and the contracts contain jurisdiction clauses in favour of the courts of different countries, the court is faced with a question of construction or interpretation. And at 54: ‘The parties agreed jurisdiction in favour of the English Court under the Master Agreement. The fact that TRM further committed itself in the Financing Agreement to comply with its commitments under the Master Agreement does not mean that commitments under the Master Agreement and swap transaction are any the less subject to the jurisdiction agreed under the Master Agreement, or any the less able to be adjudicated upon and enforced by proceedings in England.’

Application to reject jurisdiction of the English Courts dismissed.

Geert.

The Court of Appeal in [2018] EWCA Civ 1532 has confirmed the High Court’s approach in [2017] EWHC 371 (QB) AAA et al v Unilever and Unilever Tea Kenya ltd, holding that there is no good arguable case (the civil law notion of fumus boni iuris comes closes, as Bobek AG notes in Feniks) against Unilever, which could then be used to anchor the case in the English jurisdiction.

Pro memoria: jurisdiction against Unilever is clear, following Article 4 Brussels I Recast. That Regulation’s anchor mechanism however is not engaged for Article 7(1) does not apply against non-EU based defendants. It is residual English private international law that governs this issue.

Appellants appeal in relation to the High Court’s ruling that neither Unilever nor UTKL (the Kenyan subsidiary) owed the appellants a duty of care. Unilever has put in a respondent’s notice to argue that the judge should have found that there was no duty of care owed by Unilever on the additional ground that, contrary to her view, there was no proximity between Unilever and the appellants in respect of the damage suffered by them, according to the guidance in Chandler v Cape Plc. Unilever and UTKL also sought to challenge that part of the judgment in which the judge held that, if viable claims in tort existed against Unilever (as anchor defendant) and UTKL, England is the appropriate place for trial of those claims. Unilever also cross-appealed in relation to a previous case management decision by the judge, by which she declined an application by Unilever that the claim against it should be stayed on case management grounds, until after a trial had taken place in Kenya of the appellants claims against UTKL.

The legal analysis by Sales LJ takes a mere five paragraphs (para 35 onwards). Most of the judgment is taken up by an (equally succinct) overview of risk management policies within the group.

At 35 Sales LJ notes ‘Having set out the relevant factual background in relation to the proximity issue (i.e. whether the appellants have any properly arguable case against Unilever in the light of Chandler v Cape Plc and related authorities), the legal analysis can proceed much more shortly. It is common ground that principles of English law govern this part of the case.‘

– the ‘common ground’ presumably being lex loci incorporationis.

This is an interesting part of the judgment for I find it by no means certain that English law should govern this part of the case. In one of my chapters for professor Vinuales’ en Dr Lees’ forthcoming OUP book on comparative environmental law, I expand on that point.

The long and the short of the argument is that Unilever did not intervene in the affairs of its subsidiary in a more intensive way than a third party would have done. Reference at 37 is made to the contrasting examples given by Sir Geoffrey Vos in Okpabi, ‘One can imagine … circumstances where the necessary proximity could be established, even absent the kind of specific facts that existed in Vedanta … Such a case might include the situation, for example, where a parent required its subsidiaries or franchisees to manufacture or fabricate a product in a particular way, and actively enforced that requirement, which turned out to be harmful to health. One might suggest a food product that injured many, but was created according to a prescriptive recipe provided by the parent. …’

and, at 38, to the raison d’être of mother /daughter structures,

“… it would be surprising if a parent company were to go to the trouble of establishing a network of overseas subsidiaries with their own management structures it if intended itself to assume responsibility for the operations of each of those subsidiaries. The corporate structure itself tends to militate against the requisite proximity …

– subject evidently to proof of the opposite in the facts at issue (a test seemingly not met here).

Geert.

(Handbook of) European Private International Law, 2nd ed. 2016, Chapter 8, Heading 8.3.

Is the actio pauliana by a Polish company against a Spanish company, which had bought immovable property from the former’s contracting party, one relating to ‘contract’ within the meaning of Article 7(1) Brussels I Recast?

Bobek AG Opined in C-337/17 Feniks v Azteca on 21 June. His Opinion features among others a legal history class on the action pauliana, and eventually a justifiable conclusion: the action is not one in contract. In C-115/88 Reichert I the Court held that the French civil law actio pauliana does not fall within exclusive jurisdiction concerning rights in rem in immovable property (Article 24(1). Soon afterwards, the Court added in C-261/90 Reichert II that the same actio pauliana was neither a provisional measure nor an action bringing proceedings concerned with the enforcement of a judgment. It was also not a matter relating to tort, delict or quasi-delict.

That left only the potential for a forum contractus to be decided.

The AG reviews a number of arguments to come to his decision. One of those I find particularly convincing: at 62: assuming that the applicability of the head of jurisdiction for matters relating to a contract were to be contemplated, the question that immediately arises is which of the two contracts potentially involved should be taken as relevant? To which of the two contracts would an actio pauliana in fact relate? Among others (at 69-70) Sharpston AG’s Opinion in Ergo is discussed in this respect and the AG in my view is right when he dismisses the contractual relations at issue as an anchor point.

At 69 the AG also adds a knock-out point which could logically have come at the very beginning of the Opinion:

‘it should also be added and underlined that both approaches outlined above fail to satisfy the requirement of ‘obligation freely assumed by one party towards another’, [the AG refers to Handte, GAVC] that is by the Defendant towards the Applicant. Even if the case-law of this Court does not require that there is identity between the parties to the proceeding and to the respective contract, it appears difficult to consider that the mere filing of an actio pauliana creates a substantive-law relationship between the Applicant and the Defendant resulting from, for example, some kind of legal subrogation founded by an act of COLISEUM (as the Applicant’s initial debtor).’

Readers further may want to take note of para 92: the AG’s view to treat the power of recitals with caution. The AG ends at 97-98 with a robust defence of the Brussels regime, with specific reference to the common law (footnotes omitted):

‘What has to be sought is a principled answer that applies largely independently of the factual elements in an individual case. While fully acknowledging and commending the attractive flexibility of rules such as forum(non) conveniens that allow for derogation in the light of the facts of a specific case, the fact remains that the structure and the logic of the Brussels Convention and Regulations is indeed built on different premises. What is understandably needed in a diverse legal space composed of 28 legal orders are ex ante reasonably foreseeable, and thus perhaps somewhat inflexible rules at times, and less of an ex post facto explanation (mostly as to why one declared oneself competent) heavily dependent on a range of factual elements.

All in all, in the current state of EU law, actio pauliana seems to be one of the rare examples that only allows for the applicability of the general rule and an equally rare confirmation of the fact that ‘… there is no obvious foundation for the idea that there should always or even often be an alternative to the courts of the defendant’s domicile’. ‘

A solid opinion with extra reading for the summer season (on the Pauliana).

Geert.