Flux Belges et Lux

In Islandsbanki & Ors v Stanford [2020] EWCA Civ 480, upon appeal from Fancourt J in [2019] EWHC 1818 (Ch), Asplin LJ discussed whether purported execution of a foreign judgment registered in the High Court pursuant to the Lugano Convention, can be execution issued in respect of the judgment debt (for the purposes of section 268(1)(b) of the Insolvency Act 1986), if the execution occurred before the period for appealing the registration of the judgment has expired and, if not, whether the defect can be cured.

An unpaid Icelandic judgment debt from 2013 which together with interest, is now in excess of £1.5 million sterling equivalent. The judgment was given against Mr Stanford in the Reykjanes District Court in Iceland on 26 June 2013. A certificate was issued by the Icelandic court on 16 October 2013, pursuant to Articles 54 – 58 Lugano. IB applied to register the Icelandic judgment in England and Wales on 16 March 2016. A registration order was sealed on 23 March 2016 (the “Registration Order”).

Some of the issues in the Appeal (and before Fancourt J) concern purely English procedural rules however their effect is of course to facilitate, or obstruct, recognition and enforcement under the Lugano Convention. The confusion to a great degree results from the UK, despite Lugano’s direct effect, having implemented the Convention in the CPR rules anyway (at 24). The submission made by appellant (the Bank) before the Court is essentially that a narrow interpretation of the English CPR rules which would not allow remedying an error in the procedure, would run counter Lugano’s objective of facilitating recognition and enforcement (reference is made to the Pocar report and the recitals of Lugano itself).

Asplin LJ at 38 points to the language of Lugano itself: ‘during the time specified for an appeal pursuant to Article 43(5) against the declaration of enforceability and until any such appeal has been determined, no (emphasis in the original) measures of enforcement may be taken other than protective measures against the property of the party against whom enforcement is sought. The ordinary and natural meaning of those provisions is quite clear.’ She also at 37 points to the Convention’s objectives not being restricted to ease of enforcement: ‘the underlying policy of Articles 43(5) and 47(3) is that a fair and proportionate balance must be struck between the interests of the party which applies for a registration order having obtained a judgment in a foreign jurisdiction to which the Convention applies, and the defendant/debtor whose rights of appeal are prescribed by law and should not be undermined by allowing irreversible measures of enforcement.’

Conclusion, at 40: ‘It is for that reason that CPR 74.6(3) provides that a registration order must contain reference to the period in which an appeal against registration can be lodged and that no measures of enforcement can be taken before the end of that period and the reason why that prohibition was repeated in the Registration Order itself at paragraph 2. Accordingly, any attempt to remedy the premature issue and execution under the Writ of Control by means of an exercise of the discretion under CPR r3.10(b) or the use of CPR r3.1(2)(m) or 3.1(7) (or the inherent jurisdiction of the court, for that matter) would fundamentally undermine Article 47(3) and section 4A(3) in a way which is impermissible.’

at 62 ‘The defect in the execution in this case, if it can be called a defect, was fundamental….It was not a mere technicality or a formal defect which might be rectified pursuant to what is now Rule 12.64 of the Insolvency Rules 2016. It went to the heart of the execution process’.

Appeal dismissed following an interesting and clear application of both Lugano’s provisions and its spirit.

Geert.

Recognition and enforcement, Lugano.
Whether purported execution of foreign judgment can be issued in respect of the judgment debt, for purposes of Insolvency Act, if execution occurred before the period for appealing the registration of the judgment has expired. https://t.co/bPt9U1IaHt

— Geert Van Calster (@GAVClaw) April 2, 2020

A late-ish flag to keep an eye on Greenpeace’s class-action suit filed in the Austrian courts to have the Austrian tax breaks on air traffic (tax exemption on kerosene fuel for domestic flights and a VAT exemption on international flights) lifted. It is certain to engage the Chicago Convention and the European implementation of same. The argument is inter alia that the non-exemption for rail is a form of State Aid to the airlines. I wrote on the issues in 2016, featuring T-351/02 Deutsche Bahh, arguing that the CJEU could have forced the issue then. What would be most excellent would be for the Austrian courts to refer to Luxembourg so as the CJEU may revisit the issue 14 years on from the judgment of the then Court of First Instance, in a world were many look a lot less forgivingly at the exemptions’ implications for internalising negative environmental externalities.

Geert.

EU environmental law (with Leonie Reins), Edward Elgar, 2018.

BREAKING: first ever climate change case directly targeting aviation emissions, as @GreenpeaceAT asks Austria's Constitutional Court to repeal laws offering tax credits on plane fuel, alleging violation of international human rights law, Articles 2/8 ECHR.https://t.co/Bmozqd8M3b pic.twitter.com/B0p1MKGrh5

— Sam Varvastian (@SamVarvastian) February 20, 2020

Sánchez-Bordona AG issued his opinion in C‑343/19 Verein für Konsumenteninformation v Volkswagen last Thursday. He relies heavily of course on CJEU authority almost all of which is reviewed on the blog – with Tibor Trans making a star appearance given its recent nature as well as its focus, like in Volkswagen, on financial damage.

Not long after, yesterday, the High Court in England in [2020] EWHC 783 (QB) held on a first preliminary issue in the class action suit pending there. Matthias Weller has already reviewed that judgment here. In that judgment, a lex causae argument on the binding authority of a German public body’s decision was advanced by claimants in subsidiary fashion. This was not entertained by the High Court for it had already found a binding effect on other grounds. Incidentally, the nature and timing of the High Court’s ruling suggest that there is no contestation of jurisdiction being brought forward by Volkswagen – I am enquiring with counsel in the case.

Returning to CJEU C-343/19, though: Raphael de Barros Fritz has analysis here and I am happy to refer, for timing for the release of my own ponderings on the Opinion suffered from a Friday afternoon call on injunctive relief and jurisdiction. A few additional notes of interest and subject to further pondering:

Firstly, the AG is too kind when he suggests that the Brussels Convention had left open the (now) Article 7(2) question. The Court’s locus damni /locus delicti commissi distinction was not at all required by then Article 5(3). Much as the distinction may have been clear to make in the Bier case itself, it was not at all advanced by the text of the Brussels Convention. Many of us have been pointing out the fallacy, including Cruz Villalon AG in his Opinion in Pez Hejduk, case C-441/13 which I reviewed here and Szpunar AG in his Opinion in Universal Music reviewed here. As Sánchez-Bordona AG points out in Volkswagen, the distinction has become a paradigm (at 2); ‘obstinance’ might also be a good word for it. The result of the CJEU refusing formally to reverse its Bier distinction, means itself and the national courts have been having to conjure up all sorts of distinguishing to respect both the Handlungsort /Erfolgort distinction, and the predictability of Brussels Ia as well as the need to interpret special jurisdictional rules restrictively.

Raphael makes a most valiant effort to do justice to the AG’s attempt at systemisation, yet the reality remains that most certainly on the locus damni front, the ever unclearer distinction between direct and indirect aka ‘ricochet’ damage is a Valhalla for reverse engineering – and we have not even thrown Lazar into the mix.

The AG suggests that not only the first purchasers of the vehicle may be direct victims, but also downstream purchasers of second-hand vehicles, however in each case constrained (if I understand the Opinion properly) to those purchasers, first or not, where the loss of value of the vehicles did not become a reality until the manipulation of the engines was made public: at 41; ‘ The loss of value of the vehicles did not become a reality until the manipulation of the engines was made public. In some instances, the applicants may be end users who obtained the vehicle from another, previous buyer; however, the latter did not experience any loss because, at that time, the damage was latent and was not disclosed until later when it affected the then owner. Therefore, it is not possible to describe the damage as being passed on from the original buyers to successive buyers.’

Further, given that the location of the vehicle is unforeseeable, the Advocate General considers that the place where the damage occurred is the place where that transaction was concluded, pursuant to which the product became part of the assets of the person concerned and caused the damage. However even for these cases other elements (per Universal Music) will have to be shown to avoid forum shopping and for these other elements, the AG suggests in particular a minimum contacts rule such as in US conflict of laws: at 75: ‘the defendant’s intention to sell its vehicles in the Member State whose jurisdiction is in issue (and, as far as possible, in certain districts within that State).’

On locus delicti commissi, the AG suggests at 34 that the event giving rise to the damage in this case consists of the installation, during the vehicle manufacturing process, of software which alters the vehicle’s emissions data. I do not think that is the only possible Handlungsort: other events in the Dieselgate chain arguably may qualify as Handlungsort, too: the executive decision to go ahead with the program, for instance. Or the regulatory steps (including type approval under EU law such as discussed in [2020] EWHC 783 (QB), above; or other steps required under EU or national law) needed to market the product in the country.

The last words on this Opinion have far from been said.

Geert.

(Handbook of) EU Private International Law, 2nd ed. 2016, Chapter 2, Heading 2.2.11.2.7

Many thanks again María Barral for continuing her updates on C-186/19 Supreme v Shape; see her summary of Thursday’s opinion of the AG below. I just wanted to add two things.

Firstly, the AG’s suggestion that in spite of the intervening Court of Appeal judgment which would seem to make the CJEU case nugatory, the case should continue for against the appeal’s court decision, a further appeal is underway with the Supreme Court.

Second, at 93 etc. the AG advises that the immunity or not of the defendant, bears no relevance to the scope of application of BIa for it does not feature in the concept of ‘civil and commercial’ as developed by the Court.

That in my view is at odds with the CJEU’s very statement in Eurocontrol, at 4: the Court’s seminal judgment on civil and commercial itself in so many words links the scope of application to the practicality of recognition: in Eurocontrol the CJEU interprets ‘civil and commercial’ ‘in particular for the purpose of applying the provisions of Title III of the Convention‘: there is little use bringing issues within the scope of the Convention and now BIa, if ab initio there is no prospect of recognition and enforcement.

In other words I am not at all sure the Court will follow the AG on that part of the analysis. I should emphasise this is my view: María’s review independent of that follows below.

Geert.

Immunity does not impact jurisdiction based on Regulation Brussels I bis, AG Saugmandsgaard Øe dixit

María Barral Martínez

Following up on the previous posts (see here and here) discussing the contractual dispute between Supreme site Services v. SHAPE, today’s post addresses  the Opinion of Advocate General Saugmandsgaard Øe in C-186/19 Supreme v Shape.

While the questions posed by the referring court concerned the interpretation of articles 1(1) and 24(5) Brussels Ia, ‘at the CJEU’s request’ (5) limits his analysis to Article 1(1).

In a nutshell, the analysis in his Opinion is twofold: on the one hand, he examines whether the action brought by SHAPE – an international organisation- seeking the lift of an interim garnishee order falls within the meaning of “civil and commercial matters” laid down in article 1(1) of the Brussels I bis Regulation. On the other hand, he analyses whether the fact that SHAPE had invoked its immunity from execution in the interim relief proceedings has any significance on the above evaluation.

In tackling the first prong of his analysis, AG Saugmandsgaard Øe recalls the public hearing held at the CJEU back in December 2019. There, the focus was put on how the  “civil and commercial” nature of the interim relief measures sought by SHAPE is to be assessed – in the light of the features of the proceedings on the merits, based exclusively on the interim relief proceedings or only in relation to the nature of the rights the interim measures intend to safeguard matters. AG Saugmandsgaard Øe rejects the first two alternatives and follows the thesis supported by the Governments of The Netherlands and Belgium and by the European Commission: in line with the judgments de Cavel I and de Cavel II, the nature of the rights whose recognition is sought in the proceedings on the merits and whose protection is the purpose of the interim or protective measures sought is decisive. (Point 46 and 51)

Furthermore, AG conducts a thorough analysis on the immunities recognised under Public International Law vis-à-vis the application of Brussels Ia. He argues that to determine whether a dispute should be excluded from the scope of BIa on the grounds that it concerns “acts or … omissions in the exercise of State authority” – A1(1) in fine-, it is necessary to assess whether the action is based on a right which has its source in acta iure imperii or in a legal relationship defined by an exercise of State authority. (at 90)

On that basis, he concludes that an action for interim measures such as the one in the present case, seeking the lift of a garnishee order, must be regarded as “civil and commercial” in so far as the garnishee order was aimed to safeguard a right arising from a contractual legal relationship which is not determined by an exercise of State authority. (at 104)

Finally, AG Saugmandsgaard Øe posits that the fact that an international organization as SHAPE has invoked immunity from execution, has no bearing in the assessment of the material application of Brussels Ia. What’s more, it cannot serve as an obstacle for a national court to establish its international jurisdiction based on the aforementioned Regulation.

(Handbook of) EU private international law, 2nd ed. 2016, Chapter 2, Heading 2.2.2.2.

In Wallis Trading Inc v Air Tanzania Company Ltd & Anor [2020] EWHC 339 (Comm), at stake is a claim by Wallis Trading, a Liberian company which carried on the business of acquiring and leasing aircraft, against Air Tanzania and the Government of Tanzania in respect of sums which Wallis says are due to it from the Defendants arising out of a lease of an aircraft by Wallis to ATCL.

Of interest to the blog is the discussion of the Rome Convention at 74 ff. Defendants contend that the Lease is invalid, and ‘null and void’ because it was entered into in breach of the Procurement Legislation. Butcher J holds that the Lease expressly provided that English law was to be its governing law. The putative law of the lease therefore is English law (the bootstrap of Article 8 Rome Convention, now Article 10 Rome I. The Procurement Legislation is not part of English law, and non-compliance with it does not, as a matter of English law, render the Lease invalid, null or void.

What however about the application of A7 Rome Convention’s rule on lois de police /mandatory law?

1. When applying under this Convention the law of a country, effect may be given to the mandatory rules of the law of another country with which the situation has a close connection, if and in so far as, under the law of the latter country, those rules must be applied whatever the law applicable to the contract. In considering whether to give effect to these mandatory rules, regard shall be had to their nature and purpose and to the consequences of their application or non-application.

2. Nothing in this Convention shall restrict the application of the rules of the law of the forum in a situation where they are mandatory irrespective of the law otherwise applicable to the contract]

Here, Butcher J points out that Article 7(1) of the Rome Convention does not have the force of law in the United Kingdom: the UK had entered an Article 22 reservation viz the lois de police rule. The impossibility of same viz Rome I led to the stricter language in Article 9. In the event of Rome I not being part of the future relations between the UK and the EU, the Convention and its reservation will once again be applicable.

Geert.

(Handbook of) European Private International Law, 2nd ed. 2016, Chapter 3, Heading 3.2.8, Heading 3.2.8.3.

Interesting re applicable law.
Choice of court and law pro England.
Includes consideration of mandatory law (alleged invalidity under Tanzanian procurement law) under the Rome Convention. Rome I does not apply ratione temporis.
UK reservation viz Article 7 Rome Convention. https://t.co/ONQ1oO9YGX

— Geert Van Calster (@GAVClaw) February 24, 2020

I wrote earlier on the judgments at the High Court and the Court of Appeal in Aspen Underwriting v Kairos Shipping. The Supreme Court held yesterday and largely upheld the lower courts’ decisions, except for the issue of whether an economically equal party may nevertheless enjoy the benefit of the insurance section of Brussels Ia.

Reference is best made to my earlier posting for full assessment of the facts. The Supreme Court considered four issues.

Issue 1: Does the High Court have jurisdiction pursuant to the exclusive English
jurisdiction clause contained in the Policy? This was mostly a factual assessment (is there a clear demonstration of consent to choice of court) which Lord Hodge for the SC held Teare J and the Court of Appeal both had absolutely right. Lord Hodge refers in support to a wealth of CJEU and English (as well as Singapore) courts on assignment and contractual rights v obligations.

Issues 2 and 3: Are the Insurers’ claims against the Bank matters ‘relating to
insurance’ (issue 2) within section 3 of the Regulation and if so, is the Bank entitled to rely on that section (issue 3)?

On issue 2, Teare J and the Court of Appeal had held that the Insurers’ claim against the Bank was so closely connected with the question of the Insurers’ liability to indemnify for the loss of the Vessel under the Policy that the subject matter of the claim can fairly be said to relate to insurance.

On this issue the insurers had appealed for they argued that a claim can be regarded as a matter relating to insurance only if the subject matter of the claim is, at least in
substance, a breach of an obligation contained in, and required to be performed by,
an insurance contract. They referred in particular to Brogsitter and also to Granarolo and Bosworth.

Lord Hodge disagreed with claimant, upholding Teare J and the CA: the need for restrictive interpretation is mentioned (at 38) and at 35 it transpires that of particular relevance in his analysis is the very wording of the title of the insurance section: unlike all other special jurisdictional rules of interest, it does not include ‘contracts’. Further (at 36),

‘the scheme of section 3 is concerned with the rights not only of parties to an insurance contract, who are the insurer and the policyholder, but also  beneficiaries of insurance and, in the context of liability insurance, the injured party, who will generally not be parties to the insurance contract.’

At 40 he holds that in any event the Brogsitter test is met:

‘The Insurers’ claim is that there has been an insurance fraud by the Owners and the Managers for which the Bank is vicariously liable. Such a fraud would inevitably entail a breach of the insurance contract as the obligation of utmost good faith applies not only in the making of the contract but in the course of its performance.’

[Of note is that the ‘related to’ issue was discussed in Hutchinson and is at the CJEU as C-814/19, AC et al v ABC Sl as I flag in my review of Hutchinson).

However (issue 3) both Teare J and the CA eventually held that the insurance title failed to provide the bank with protection for they argued (as I noted with reference in particular to CJEU Voralsberger) that protection was available only to the weaker party in circumstances of economic imbalance between the claimant insurer and the defendant.

Here the SC disagrees and overrules. Lord Hodge’s reasons are mentioned at 43 ff, and I will not repeat them fully here. They include his view on which he is entirely right and as I have pointed out repeatedly, that recitals may be explanatory but only the rules in the Regulation have legal effect). Bobek AG’s Opinion in C-340/16 Kabeg features with force. Hofsoe is distinguished for, at 56,

‘In none of these cases where the CJEU has relied on the “weaker party” criterion to rule on applications to extend the scope of the section 3 protections beyond those parties who were clearly the policyholder, the insured, the beneficiary or the injured party, did the court call into question the entitlement of those expressly-named persons to that protection by reason of their economic power.’

That assessment is not entirely consistent for as Lord Hodge himself notes, and the CJEU acknowledges, in KABEG, Vorarlberger, Group Josi and GIE the jurisdiction of the forum actoris had been extended under articles 11(1)(b) and 13(2) to include the heirs of an injured party and also the employer who continues to pay the salary of the injured party while he was on sick leave.

All in all, it agree following Lord Hodge’s convincing review of the cases, that it is acte clair that a person which is correctly categorised as a policyholder, insured or beneficiary is entitled to the protection of section 3 of the Regulation, whatever its economic power relative to the insurer. (Even if particularly following Hofsoe the application of the section as a whole might need a more structured revisit by the CJEU). In the case at hand the Bank is the named loss payee under the Policy and therefore the “beneficiary” of that Policy (at 60).

In conclusion: Under A14 BIa the Bank must be sued in The Netherlands.

Finally, whether claims in unjust enrichment fall within article 7(2) (answered by Teare J in the negative) ‘does not arise’ (at 60). I am not entirely sure what this means: was it no longer challenged or was Teare J’s analysis on this straightforward? A different reply than that of Teare J would have required overruling Kleinwort Benson Ltd v. Glasgow City Council (No. 2) [1999] 1 AC 153 (HL), that a claim in unjust enrichment for mistake was neither a matter ‘relating to contract’ nor a matter ‘relating to tort’ for the purposes of EU private international law – an issue I discussed in my earlier posting. With the SC’s refusal to entertain it, that authority therefore stands.

One does wish that the CJEU at some point have an opportunity further to clarify the insurance section and will do so in a holistic manner. The SC judgment here is one big step in the good direction.

Geert.

(Handbook of) EU Private International Law, 2nd ed. 2016, Chapter 2, Heading 2.2.11.1, Heading 2.2.11.2.

A long overdue post I fear (I hope in the next week and a half or so to turn to draft posts which for all sorts of reasons have gotten stuck in the queue, finally to be published) on Lamesa Investments Ltd v Cynergy Bank Ltd  [2019] EWHC 1877 (Comm). Latham and Watkins have had background for some time here.

The case concerns a standard clause in an English law governed contract on ‘mandatory law’ as an excuse for contractual non-performance. Here, the clause (in a (credit) facility agreement) read: clause 9.1: (party is not in breach of the agreement if) “… sums were not paid in order to comply with any mandatory provision of law, regulation or order of any court of competent jurisdiction”.

“Regulation” was defined in the Agreement as including “any regulation, rule, official directive, request or guideline … of any governmental, intergovernmental, or supranational body, agency, department or of any regulatory, self-regulatory or other authority or organisation”.

Lamesa argued that Cynergy could not rely on clause 9.1 because:

• “provision of law” meant a law that applied to a UK entity, acting in the UK, that had agreed to make a sterling payment pursuant to a contract governed by English law; and
• “mandatory” meant that the relevant law made it compulsory for Cynergy to refuse payment

‘In order to comply’ was the focus of discussions, in particular whether there was any territorial limit to it. Pelling J took a flexible approach, holding that Cynery could not reasonably be expected to have excluded the only type of sanction which it could have reasonably foreseen, namely secondary sanctions imposed by US sanctions law (at the time the parties entered into the Facility Agreement, Cynergy was aware that it was possible that US sanctions would be imposed on Lamesa).

Of interest to the blog is the brief reference to Rome I (and the Convention), at 23:

‘It was submitted on behalf of CBL and I agree that English lawyers during the period the FA was being negotiated and down to the date when it became binding would have understood a mandatory law to be one that could not be derogated from. The context that makes this probable includes the meaning given to the phrase “… mandatory provision of law …” in the Rome Convention 1980 and the Rome 1 Regulation on Choice of Law. It was not submitted by CBL that the construction for which they contend applies by operation of either regulation. It submits however and I accept that they provide some support for the submission that lawyers at the relevant time would have understood the effect of the word “mandatory” to be as I have described. It goes without saying that it was not open at any stage to either party to dis-apply the US statutes that purported to apply secondary sanctions by their agreement, nor did the parties attempt to do so either in the FA itself or afterwards.’

Geert.

(Handbook of) European Private International Law, 2nd ed. 2016, Chapter 3, Heading 3.2.8, Heading 3.2.8.3.

The CJEU last week confirmed Saugmandsgaard ØE AG’s Opinion in C-215/18 Libuše Králová v Primera Air Scandinavia. In a package of services acquired from a travel agent, where there is no direct agreement with the airline carrying out the flight part of the package, there is a ‘contract’ between the individual and the airline within the meaning of Article 7(1) BIa. However the consumer section of BIa must be interpreted less extensively. Only the direct relationship between the travel agent and the consumer is covered by that section, not the relationship with the airline who merely carries out the transport side of the arrangement. (Note again the different balance struck by the AG and now the CJEU as opposed to e.g. the High Court in Bonnie Lackey).

Geert.

(Handbook of) European private international law, 2nd ed. 2016, Chapter 2, Heading 2.2.8.2.

In Bournemouth, Christchurch and Poole Council v KC et al [2020] EWFC 20, Dancey J at  62 ff is the first UK judge to my knowledge to discuss the implications of the UK’s separation from the EU’s civil procedure /justice and home affairs agenda, particularly in the transition period. It includes a discussion of the UK’s Brexit (EU Exit) Regulations 2019/2003, reg 3, and the European Commission notice on transition provisions.

The care proceedings concern W, a girl aged 9, nearly 10. W’s parents, who were married, are Polish nationals and W was born there. Following the separation of the parents in Poland in April 2016, contested contact proceedings there resulted in an order providing that W live with the mother with contact to the father. The father’s parental responsibility was limited to decisions about medical treatment and education. Following the breakdown of the father’s contact with W, the mother brought her to the UK in June 2018 where they have remained since. That was done without the father’s agreement, although he was aware the mother planned to relocate and acquiesced once the move had taken place. The mother did not tell the father of her and W’s location within the UK.

The legal framework therefore is Brussels IIa, Regulation 2201/2003. Dancey J at 63 concedes that by reg 8 of 2019/2003, dealing with saving/transitional provisions, the UK’s revocation from Brussels IIa does not apply to proceedings before a court in a Member State seised before 31 December 2020. However he then refers to the EC Notice to Stakeholders: Withdrawal of the United Kingdom and EU Rules in the Field of Civil Justice and Private International Law: 18/1/2019, and suggests it means that EU rules on recognition and enforcement will not apply to a UK judgment, even if the judgment was given, or enforcement proceedings started, before 1 January 2021 unless the judgment has been exequatured (declared enforceable by the courts of the Member State where recognition or enforcement is required) before 1 January 2021. Support for his opinion is found I suspect mostly in Heading 2.2 of that Notice.

At 66 Dancey J suggests in practice the consequence should not be too dramatic in the case at issue for ‘one or other of the parents should apply promptly in Poland for a declaration recognising this judgment and the order that will follow (exequaturing the judgment).’ That absence of real delay in the case at issue may well be true (it is confirmed by a letter from the Polish consulate) however the  implications are already clear and no surprise. Enforcement of UK judgments will be a lot less smooth post Brexit.

Geert.

Bru IIA Regulation
Incl 1st (?)) application of Jurisdiction, Judgments (Family) part of the #Brexit (EU Exit) Regulations 2019/2003, reg 3.
EC notice on transition provisions
Exequatur needed even if judgment was given, or enforcement proceedings started, before 1 January 2021. https://t.co/Ve8MKYzMdd

— Geert Van Calster (@GAVClaw) March 20, 2020

Thank you Ennio Piovesani for signalling and reviewing one of the first conflicts-specific developments on the Corona /Covid 19 landscape.

In an effort to safeguard the economic position of the travel sector, the Italian Government by decree has essentially frozen the travel sector’s statutory duty to reimburse travellers whose package travel has become impossible due to the pandemic. Ennio reports that the decree refers specifically to Article 9 Rome I’s overriding mandatory law provisions (earlier applied in Unamar), (in his translation): ‘“The provisions of the present article constitute overriding mandatory provisions within the meaning of Article 17 of Law of 31 May 1995, No. 218 [“Italian PIL Act”] [5, 6] and of Article 9 of Regulation (EU) No. 593/2008 of the European Parliament and of the Council, of 17 June 2008 [“Rome 1 Regulation”]”.

Ennio signals and important issue: how much leeway may be given to Member States to push their own definition of the concept of ‘lois de police’ /overriding mandatory law in light of the CJEU definition in Joined Cases C-369/96 and C-376/96 Arblade. In Brussels Ia of course the CJEU has pushed the concept of ordre public in a limited direction. Lois de police however are different from ordre public and Rome I is not Brussels Ia, and I am therefore not so pessimistic as Ennio when it comes to leaving a lot of discretion to Member States. What to me looks a touch more problematic is the relation with the package travel Directive 2015/2302 which applies to many of the travel arrangements concerned and which is the source of many of the protections for travellers.

No doubt to be continued.

Geert.

(Handbook of) European Private International Law, 2nd ed. 2016, Chapter 3, Heading 3.2.8.3.

A quick note on Kenyon v Secretary of State for Housing Communities & Local Government et al [2020] EWCA Civ 302 in which Coulson J checks planning consent ia against the requirements of the EU Environmental Impact Assessment- EIA Directive 2011/92. Of particular interest is his application of the Wednesbury judicial review test.

At 12: ‘A decision as to whether a proposed development is or is not likely to have significant effects on the environment can only be struck down on Wednesbury grounds’. ‘Wednesbury unreasonableness‘ is akin to CJEU standard of judicial review. Diplock J formulate it later as an administrative decision being annulled only if it was ‘So outrageous in its defiance of logic or accepted moral standards that no sensible person who had applied his mind to the question to be decided could have arrived at it.’ The grounds in Wednesbury are very akin to the CJEU grounds: annulment will follow only if (well summarised by Wiki):

• in making the decision, the defendant took into account factors that ought not to have been taken into account, or
• the defendant failed to take into account factors that ought to have been taken into account, or
• the decision was so unreasonable that no reasonable authority would ever consider imposing it.

Applied at issue at 63 ff to the precautionary principle, applicant’s argument that ‘inevitable air pollution caused by the development’ must be taken into account, fails. at 67: ‘In circumstances where there was no doubt in the mind of the relevant decision-maker, there is no room for the precautionary principle to operate.’ (Clearly and in applying all Wednesbury principles, that absence of doubt must have followed from the right information having been taken into account).

Geert.

EU environmental law (with Leonie Reins), Edward Elgar, 2018, p.28 ff.

Environmental Impact Assessment #EIA, consideration ia of Directive 2011/92.
Argument based on the precautionary principle fails: 'inevitable air pollution' caused by a planned development does not suffice to trigger the principle.
(Wednesbury judicial review principles). https://t.co/jCa8r4FLJA

— Geert Van Calster (@GAVClaw) March 5, 2020

In Manitou v J.C. Bamford Excavators, (defendant is better known as ‘JCB’ which in England is an eponym for ‘digger’ or excavator) the Paris Court of Appeal held that French Courts have jurisdiction in an interesting tale of patent insults. JCB (England incorporated) had obtained a French injunction against Manitou (domiciled at France) obliging it to halt production of one of its products possibly in violation of a JCB patent. On the eve of an important trade fair taking place in France, JCB boasted about the injunction in a Twitter, Linked-in and website post. Manitou argue the post was insulting and an act of unfair competition.

Manitou claim jurisdiction on the basis of A7(2) BIa, special jurisdiction for tort, per CJEU C-618/15 Concurrences /Samsumg /Amazon, which I reviewed here. It refers to all sites on which the news was posted being accessible in France (Pinckney would have been strong authority here); to the post discussing a French judgment which is only aimed at and enforceable in France; and that its publication was timed to coincide with the aforementioned French fair. JCB on the other hand argue mere accessibility does not suffice and that the sites did not target readers in France.

The Court refers both to Shevill and to Concurrences; decides that the very fact that the site was published in English does not insulate it from French jurisdiction (seeing also that plenty of potential clients looking to buy from Manitou at the time would have been in France for the fair); and that the publication clearly would have affected the brand’s reputation in France and also its sales there. Jurisdiction therefore established.

Geert.

(Handbook of) European private international law, 2nd ed. 2016, Chapter 2, Heading 2.2.11.2

Unfair competition, publication by UK defendant of judgment concerning #patent infringement
Jurisdiction, Article 7(2) Brussels Ia.
Paris CA upholds FR jurisdiction citing Shevill, Concurrences (on which https://t.co/Ibsofl7Jsl) https://t.co/WD61WwHtwv

— Geert Van Calster (@GAVClaw) March 5, 2020

Many thanks 2TG for initially flagging the judgment, and for Maura McIntosh and colleagues not just for further reviewing it but also for sending me copy: for the case has not yet appeared on the usual sites.

In Pandya v Intersalonika [2020] EWHC 273 (QB), Tipples J held that proceedings were time-barred in accordance with Greek law as the lex causae, where the claim form was issued in the English courts before the expiry of the applicable Greek limitation period, but was not served until after that period had expired.

The claim arises out of a road traffic accident that happened in Kos, Greece on 29 July 2012. The claimant is a UK national and was on holiday in Kos with her family when she was struck by a motorcycle as she was crossing the road. The claimant suffered a severe traumatic brain injury and was then aged fifteen. Defendant is the Greek-registered insurance company which provided insurance to the motorcyclist or the motorcycle that he was riding.

That claimant is entitled to sue the insurer in England is not of course, contrary to Tipples J passing reference, a result of Rome II but rather of Brussels IA. Jurisdiction however at any rate was not under discussion.

Defendant then relies on A15(h) Rome II to argue a time bar under Greek law, the lex locus damni: service of the claim is a rule of Greek law in relation to limitation and a claim has to be issued and served to interrupt the limitation period. This means that the requirement of service cannot be severed, or downgraded, to a step which is simply governed by the rules of civil procedure under English law. Claimant by contrast argues that service of the claim is a point of pure procedure, which falls squarely within Article 1(3) and is governed by the rules of civil procedure under English law.

At 25 ff Tipples J discusses the issue (I highlight the most relevant arguments)

• starting with the principle of autonomous interpretation;
• further, a need for wide interpretation of A15 which she derives from its non-exhaustive character. I do not agree that non-exhaustive listings necessarily equate broad interpretations;
• thirdly the need, by contrast, to interpret A1(3) narrowly ‘because it is an exception’ to the general rule of lex locus damni in A4. This too I disagree with: A1(3) states it ‘it shall not apply to evidence and procedure, without prejudice to Articles 21 and 22’ (which concern formal validity and burden of proof). In my view A1(3) like A1(2) defines the scope of application, like A1(2). It is listed separately from the issues in A1(2) for unlike those issues, part of the excluded subject-matter is partially brought back into the scope of application. If anything therefore needs to be interpreted restrictively, it is the partial cover of evidence and procedure.  Seemingly between parties however this was not disputed.
• Further support is found in Dicey & Morris 15th ed., which refers to Wall v Mutuelle de Poitiers a case which discusses the issues somewhat, yet if anything more in support of English law applying to the discussion in Pandya rather than the other way around. (A reference further on in Andrew Dickinson’s Rome II Volume with OUP in my mind, too, further underlines the opaqueness of the A1 /A15 distinction and does not clearly lend support pro the lex causae argument).
• Fifth, predictability and certainty are cited in support however how these gazump exclusions from the scope of application is not clear to me.
• Finally PJSC Tatneft v Bogolyubov is referred to but dismissed as irrelevant (which surprises me).

Held: the claim was time-barred and therefore dismissed.

I would suggest there is plenty of scope for appeal here.

Geert.

(Handbook of) EU Private International Law, 2nd ed. 2016, Chapter 3.

Thank you Matthias Lehmann for flagging and reviewing the Rotterdam Court’s judgment late in January on applicable law in the Petrobas case. I had earlier reviewed the jurisdictional issues, particularly the application of Brussels Ia’s Article 33-34.

The case relates to a Brazilian criminal investigation into alleged bribery schemes within Petrobras, which took place between 2004 and 2014. The court first, and of less interest for the blog, deals with a representation issue, holding that Portuguese speakers cannot be represented in the class, for the Portuguese version of the relevant dispute settlement provisions, unlike the English translation, was not faulty.

Turning then to applicable law at 5.39 ff. Events occurring on or after 12 January 2009 are subject to the Rome II Regulation. For those before that date, Dutch residual PIL applies which the Court held make Brazilian law lex causae as lex loci delicti commissi: for that is where the alleged fraud, bribery and witholding of information happened.

For the events which are covered by Rome II, the court does not wait for the CJEU finding in VEB v BP and squarely takes inspiration from the CJEU case-law on purely financial damage and jurisdiction: Kronhofer, Kolassa, Universal Music. The court notes that the CJEU in these cases emphasised a more than passing or incidental contact with a State (such as: merely the presence of a bank account) as being required to establish jurisdiction as locus damni. At 5.47 it rejects the place of the investor’s account as relevant (for this may change rapidly and frequently over time and may also be easily manipulated) and it identifies the place of the market where the financial instruments are listed and traded as being such a place with a particular connection to the case: it is the place where the value of the instruments is impacted and manifests itself. It is also a place that meets with the requirements of predictability and legal certainty: neither buyer nor seller will be surprised that that location should provide lex causae.

Conclusion therefore is one of Mozaik: Brasil, Argentina, Germany, Luxembourg are lex causae as indeed may be other places where Petrobas financial instruments are listed. (At 5.49: Article 4(2)’s joint domicile exception may make Dutch law the lex causae depending on who sues whom).

Geert.

(Handbook of) EU private international law, 2nd ed.2016, Chapter 4, Heading 4.4.

The Law Applicable to Investor Claims: New Developments from the Rechtbank Rotterdam’s Judgment in Petrobas https://t.co/cuQjWrrOe0

— EAPIL – Eur. Assoc. of Private International Law (@eapilorg) February 24, 2020

England remains a jurisdiction of choice for corporate social responsibility /CSR litigation, in recent parlour often referred to as corporate (human and other rights due diligence. Jalla & Ors v Royal Dutch Shell Plc & Ors [2020] EWHC 459 (TCC) concerns a December 2011 oil spill which claimants allege companies forming part of the Shell group are responsible for. Anchor defendant in the UK is Shell International Trading and Shipping Company Limited – STASCO.

Stuart-Smith J on Tuesday last week upheld jurisdiction against the London-based mother holding on the basis of Article 4 Brussels Ia, and rejected an application for stay on Article 34 grounds. The judgment is lengthy, the issues highly relevant: this post therefore will be somewhat more extensive than usual.

Standard applications in cases like these now take the form of opposing jurisdiction against UK based defendants using Article 34 Brussels Ia (forum non conveniens -light; readers will remember the issues from ia Privatbank (cited by Stuart-Smith J) and other A34 postings on the blog); alternatively, resisting the case go to full trial on the basis that there is no real issue to be tried; abuse of process arguments (against such defendants: based on EU law); and case-management grounds. The latter two are of course disputed following Owusu. And against non-UK (indeed non-EU based defendants), using forum non conveniens; abuse of process; case-management and no real issue to be tried.

[A further application at issue is to amend form claims to ‘correct’ defendant companies, an application which is subject to limitation periods that are disputed at length in the case at issue. This is civil procedure /CPR territory which is less the subject of this blog].

The jurisdiction challenges are what interests us here and these discussions start at 207. The discussion kicks of with core instructions for ‘Founding jurisdiction’ in principle: the five step ladder expressed by Lord Briggs in Vedanta – which of course confusingly include many echoes of forum non as well as Article 34 analysis. Claimant must demonstrate:

(i) that the claims against the anchor defendant involve a real issue to be tried;

(ii) if so, that it is reasonable for the court to try that issue;

(iii) that the foreign defendant is a necessary or proper party to the claims against the anchor defendant;

(iv) that the claims against the foreign defendant have a real prospect of success; and

(v) that, either, England is the proper place in which to bring the combined claims or that there is a real risk that the claimants will not obtain substantial justice in the alternative foreign jurisdiction, even if it would otherwise have been the proper place, or the convenient or natural forum.

For the purposes of current application, Stuart-Smith J focuses on i, ii, and v:

• When considering whether there is “a real issue to be tried” the test to be applied is effectively the same as the test for summary judgment: reference here is made to Okpabi. It may be important to point out that the ‘real issue to be tried’ test must not be confused as a negation of Owusu. The test effectively has a gatekeeping purpose, not unlike the similar test in e.g The Netherlands as shown in Kiobel.
• The second condition, reasonableness to try the real issue, Stuart-Smith J concedes that this condition has been heavily debated for it is not entirely clear. He links the condition to the anchor jurisdiction issue: for Stuart-Smith J, the fact that the anchor defendant is sued for the sole or predominant purpose of bringing the foreign defendant into the action within the jurisdiction is not fatal to an application to serve the foreign defendant out of the jurisdiction. He seems to suggest therefore a light reading of the reasonableness requirement and emphasises (at 215) as Lord Briggs had done in Vedanta, that per C-281/02 Owusu, the effect of the mandatory terms of A4(1) BIa is that jurisdiction that is vested in the English Court by the article may not be challenged on arguments which in other circumstances would be forum non conveniens grounds. (This reinforces his flexible reading of the reasonableness requirement).
• On the fifth condition, Stuart-Smith J at 217 focuses on the scenario of an A4 defendant likely to continue being sued regardless of the English PIL decision (forum non in particular) viz the non-EU defendants (an issue which was quite important in Vedanta, where no A34 arguments were raised). If that is indeed likely then in his view this must have an impact on how the court considers the application of the English rules.

As noted Stuart-Smith J lists these arguments as ‘founding jurisdiction’ and at 227 finds there is a real issue to be tried: a reliable conclusion in the other direction (that STASCO had not retained legal responsibility for the operation of the Northia) cannot be found at this jurisdictional stage.

The Abuse of EU law argument is given short, one para (at 218) shrift, with reference to Lord Briggs in Vedanta (who focused on Article 8(1) CJEU authority for there is little precedent on abuse of EU law).

Turning then to the pièce de résistance: Article 34.  Readers of the blog will have followed my regular reporting on same.

Stuart-Smith’s first discusses authority in abstracto, and his points are as follows:

• BIa’s section 9, ‘lis pendens – related actions’, harbours two twins. At 222: ‘Articles 29 and 33 apply where proceedings in different jurisdictions involve the same cause of action and are between the same parties. Articles 30 and 34 apply where proceedings in different jurisdictions are “related” without satisfying the additional prerequisites for the application of Articles 29 and 33 (i.e. the same cause of action and between the same parties).‘ The twins are of course not identical: in each set, one involves action ex-EU, the other looks to intra-EU scenarios.
• Zooming in on the A30-34 twin: A30 defines ‘related’ and A34 does not. Under A30(3), actions are related where they are “so closely connected that it is expedient to hear and determine them together to avoid the risk of irreconcilable judgments resulting from different proceedings.” (at 222) under A34(1)a, the discretion to stay an action under that article does not arise unless “it is expedient to hear and determine the related actions to avoid the risk of irreconcilable judgment resulting from separate proceedings”. Semantically one might suggest the latter therefore is a subset of the former (which would also suggest not all actions that are ‘related’ under A30 are so under A34). Stuart-Smith J however proposes to focus on the commonality of both, which is the presence of expediency, ‘to hear and determine them together to avoid the risk of irreconcilable judgments resulting from <different: A30> <seperate: A34’ proceedings. Again at 222: ‘Although there is a semantic argument that this means that cases falling within Article 34(1)(a) are a subset of “related actions”, I cannot conceive of circumstances where this would matter: the expediency criterion is a pre-requisite for the exercise of the court’s discretion both under Article 29 and under Article 34.’
• At 223 then follows the discussion of “risk of irreconcilable judgments”. ‘Because Articles 30 and 34 do not require the proceedings to involve the same cause of action and to be between the same parties, it is plain that the “risk of irreconcilable judgments” to which Articles 30(3) and 34(1)(a) refer cannot require that there be a risk that one judgment may give rise to an issue estoppel affecting the other.’ In other words, the test of irreconcilability is suggested to be more easily met in A30 (and 34) then it is under A29 (and 33). Nevertheless, with reference to Donaldson DJ in Zavarco, Stuart-Smith J suggests the points of difference between the judgments (whether arising from findings of fact or of law) would have to “form an essential part of the basis of the judgments” before A30 or 34 may be engaged.
• At 225 he then refers to Privatbank, held by the Court of Appeal after proceedings in Jalla had been closed, in which the Court of Appeal held that the fact that actions could not be consolidated and heard together (much as of course such togetherness cannot be imposed upon the foreign courts) is relevant to the exercise of the Court’s discretion and, in the absence of some strong countervailing factor, will be a compelling reason for refusing a stay. At 246, that importance of the impossibility of consolidated hearings is re-emphasised.

At 228 then Stuart-Smith J arrives at the application in concreto. He starts with the defendants’ arguments: ‘In their written submissions the Defendants rely upon a number of claims brought by groups of claimants or communities before various courts in Nigeria and one action of rather different complexion, known as the Federal Enforcement Action [“FEA”]. They submit that the English proceedings against STASCO should be stayed, at least temporarily, in order to avoid the risk of irreconcilable judgments being reached in England and in one or more of the Nigerian proceedings by waiting for the determinations of the Nigerian Courts and then taking proper account of those determinations in disposing of the English proceedings. The Defendants submit that, by the imposition of a stay, the court would avoid “a course of conflict with the courts of a friendly state” and avoid “cutting across executive actions of the Nigerian State in relation to property situated within its territory” which the Defendants submit would be in breach of the act of state doctrine and considerations of comity.‘ He then proceeds to discuss the arguments:

• Firstly he discusses at length the status of the FEA (which counsel for the defendants focused on) as well as a number of other actions pending in the Nigerian courts.
• Of note is his observation at 234: ‘It is a fact material to the exercise of the court’s discretion on these applications that the Defendants in these proceedings rely upon the existence of the FEA as grounds for imposing a stay pursuant to Article 34 while at the same time SNEPCO is maintaining its root and branch opposition to the validity (as well as the factual merits) of the FEA.’
• At 237 he notes the not carbon copy but nevertheless overlap between proceedings, at the level of claimants, defendants, and facts, but not the allegations of negligence and Rylands v Fletcher which are not directed at STASCO in the FEA proceedings. Of note is that he adds in fine that the potential problem of double recovery is simply an issue with which the English and Nigerian courts may have to grapple in due course.
• At 241 he holds obiter that expediency is not met here for a stay would not reduce the risk of irreconcilable judgments. Here, the true nature of forum non (I realise of course A34 is only forum non light) re-emerges: the English proceedings will continue after the stay in all likelihood will have been lifted (there will continue to be a case to answer for STASCO). ‘(A)lthough the English court would afford due attention and respect to the findings of the Nigerian courts, the findings of the Nigerian courts in the FEA and the other actions would not bind the English court to make equivalent findings even on the most basic matters such as whether the December 2011 Spill reached land.’ However ‘in the light of the ruling by the Court of Appeal [in Privatbank, GAVC] that expediency is a theoretical concept, I will proceed on the assumptions (without deciding) that, for the purposes of Article 34, (a) the actions in Nigeria are related actions and (b) it is expedient to determine the related actions together to avoid the risk of irreconcilable judgment resulting from different proceedings.’
• That leaves the question whether a stay is necessary for the ‘proper administration of justice.’
  • At 242 the elements of recital 24 are considered in turn. Stuart-Smith emphasises in particular that while the damage occurred in Nigeria, there is a strong international element that is alleged to give rise to a duty of care owed by STASCO to the Claimants; and he underlines the uncertainty as to the length of the Nigerian proceedings).
  • At 245 he concludes that no stay is warranted: I shall recall the para in full (underlining is mine, as is the lay-out):
    • ‘Balancing these various considerations together, I am not satisfied that a stay is necessary for the proper administration of justice.
    • I start with the fact that jurisdiction is based on Article 4 and that it is contemplated that the proceedings against STASCO may continue after a temporary stay to await the progress of the Nigerian actions.
    • Second, the length of that stay is indeterminate whether one looks at the FEA or the other actions; but on any view it is likely to be measured in years rather than months, thereby rendering these Claimants’ claims (which were issued late) almost intolerably stale.
    • Third, a stay would prevent any steps being taken towards the resolution of the difficult limitation and other issues which the earlier parts of this judgment identify; and it would prevent any other steps being taken to ensure the swift and just progression of the English action if and when the stay is removed. That is, in my judgment, a major drawback: if and to the extent that there are valid (i.e. not statute-barred) claims to be pursued, there is a compelling interest of justice in their being pursued quickly. Otherwise, as is well known, there is a risk that valid claims may fall by the wayside simply because of the exorbitant passage of time.
    • Fourth, although the factual connection with Nigeria is almost complete, the English court’s jurisdiction is not to be ousted on forum non conveniens grounds and, that being so, there is no reason to assume that imposing a stay until after the Nigerian courts have reached their conclusions will either cause the English proceedings to be abandoned or determine the outcome of the English proceedings or eliminate the risk of irreconcilable findings altogether. I am certain that the English court would and will, if no stay is imposed at this stage, remain vigilant to the need to respect the Nigerian courts and their proceedings; and I do not exclude the possibility that circumstances might arise at a later stage when a pause in the English proceedings might become desirable in the interest of judicial comity and respect for Nigeria’s sovereign legal system.
    • Fifth, I bear in mind the fact that the scope of the FEA action is not clear, so that it is not clear what issues will be determined, save that the issue of STASCO’s responsibility and actions will not be as they are not before the Nigerian Court. Turning to the other actions, STASCO is only a party to the HRH Victor Disi Action which, though technically pending, cannot be assumed to be certain to come to trial. The status of the remaining actions, where STASCO is not a party, is as set out above but does not give confidence that one or more of those actions will emerge as a suitable vehicle for determining issues relating to the spill so as to fetter the freedom and resolve of the English court to reach a different conclusion on behalf of different claimants and in an action against STASCO if that is the proper result.
    • Sixth, in my judgment, the proper administration of justice is better served by taking interim steps to bring order to the English proceedings, specifically by addressing the issues of limitation and, potentially, existence and scope of duty, which are disclosed in the earlier parts of this judgment. The outcome of those steps should determine whether and to what extent STASCO is available as an anchor defendant.’

There is an awful lot here which may prove to be of crucial relevance in the debate on the application of Article 34. Most importantly, Stuart-Smith’s analysis in my view does justice to the DNA of A34, which includes a strong presumption against a stay.

Geert.

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

Highly relevant new CSR, corporate due diligence ruling.
Shell Bonga oil field spill
Reference to ia Privatbank https://t.co/fGnGrVjI7R and Vedanta https://t.co/SsAloPiwc9

A4 BIa jurisdiction upheld. No stay on A34 grounds. https://t.co/wIifRnsWZq

— Geert Van Calster (@GAVClaw) March 3, 2020

IN [2019] EWCOP 56 QD, Cobb J in the Court of Protection applied the Hague Convention on the International Protection of Adults to a removal from Spain of an adult father suffering from Lewy Body Dementia, a progressive neurodegenerative dementia, without consent of the new wife. by the children of his first marriage. Following the removal the children seek an order that he reside at a care home in England, that he not return to Spain, and that he have only supervised contact with his wife.

Cobb J decided that the English courts do not have jurisdiction given that in his judgment the father is habitually resident in Spain, with at 28-29 a list of the reasons leading to his conclusion (it includes a negative view on the removal ‘by stealth’, as well as particular emphasis on the father’s expressed will to live in Spain when he was not yet incapacitated). The common law doctrine of necessity does not alter this as alternative, less drastic measures could and should have been sought first (such as alerting Spanish social services; at 29).

The judge did make use of his limited urgency jurisdiction to issue a ‘protective measures’ order which provides for the father to remain at and be cared for at home he resides in, and to continue the authorisation of the deprivation of his liberty there only until such time as the national authorities in Spain have determined what should happen next. It is for the Spanish administrative or judicial authorities to determine the next step, which may of course be to confer jurisdiction on the English courts to make the relevant decision(s).

Geert.

https://www.bailii.org/ew/cases/EWCA/Civ/2020/144.pdf

I reviewed [2018] EWHC 3506 (QB) Kalma v African Minerals et al in an earlier post. It essentially entails vicarious liability of UK-incorporated companies (jurisdiction firmly settled therefore) for human rights abuses committed by Sierra Leone police (SLP), who ensured security at the defendants’ mine. All claims were held to have failed and the Court of Appeal in [2020] EWCA Civ 144 has confirmed same on 17 February (a little before the important SCC ruling in Nevsun).

The High Court’s discussion of the factual involvement of the companies with SLP activities, required to establish vicarious liability, as I noted at the time has echoes of the discussion on the level of oversight required for mother companies to be held liable for subsidiaries’ actions (such as e.g, in Apartheid, Shell (in The Netherlands) or of course in Vedanta). (The case otherwise does not raise the kind of jurisdictional or applicable law issues readers often find on this blog).

Of most relevance for the corporate social responsibility (CSR) issues are the grounds of appeal concerning the alleged duty of care owed, discussed at 110 ff: appellants say that the judge wrongly approached this case as a case of “pure omissions” and that, instead, he should have considered the existence of the duty by reference to first principles and, in particular, the three elements identified in Caparo v Dickman, namely foreseeability, proximity and whether or not such a duty was fair, just and reasonable (Ground 3). The appellants also have an alternative case that, if this was a case of pure omissions, the judge should have found that it was one of the recognised exceptions to the rule, namely that it involved the creation of the danger by the respondents themselves (Ground 4). Core factual consideration in all this are the money, vehicles and accommodation provided to the SLP, which the judge had found was common in Sierra Leone.

Coulson LJ reiterated with the judge that the duty of care tenet was one of omission: failure to protect the claimants (the respondents, arguendo, having failed to protect the claimants from the harm caused by the SLP). Extensive analysis of Turner J’s judgment at the High Court found no reason to reach a different conclusion than his.

Geert.

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

A short post to flag the French Conseil d’Etat’s final ruling in which on 7 February it held that organisms obtained via in-vitro mutagenesis techniques should be subject to GMO regulation and that consequently as EurActiv summarise the French authorities must update regulation to include such crops within six months, which includes identifying the agricultural plant varieties which have been obtained by these techniques and subjecting them to the assessments applicable to GMOs.

The ruling follows the CJEU’s mutagenesis finding in C-528/16, reviewed at the time on Steve Peers’ blog here and subsequently by KJ Garnett in RECIEL here. The ruling put agro-bio industry narrators in a spin but in essence is an utterly logical consequence of EU law.

Geert.

I have reported earlier on the issues which yesterday led to the decision of the Canadian Supreme Court 2020 SCC 5 Nevsun Resources Ltd. v. Araya, in which the Supreme Court was asked whether there should be a new tort of breach of international law, and whether the “act of state” doctrine prevents adjudication in the case at issue. The case does not have jurisdictional issues to consider so I shall leave the substantive public international law analysis (not my core area) to others: Dr Ekaterina Aristova’s Twitter feed referenced below should give readers plenty of pointers, as does (which came out just as I was finalising this post) Stephen Pitel’s analysis here.

The case does raise the kinds of questions upon which the US Supreme Court (Kiobel; Jesner) refused to be drawn, particularly issues of corporate culpability under public international law. Again, this is not my area of core expertise and my thoughts here are merely that.

Three Eritrean workers claim that they were indefinitely conscripted through Eritrea’s military service into a forced labour regime where they were required to work at a mine in Eritrea. They claim they were subjected to violent, cruel, inhuman and degrading treatment. The mine is owned by a Canadian company, Nevsun Resources Ltd. The Eritrean workers started proceedings in British Columbia against Nevsun and sought damages for breaches of customary international law prohibitions against forced labour, slavery, cruel, inhuman or degrading treatment, and crimes against humanity. They also sought damages for breaches of domestic torts including conversion, battery, unlawful confinement, conspiracy and negligence.

Nevsun brought a motion to strike the pleadings on the basis of the ‘act of state’ doctrine, which precludes domestic courts from assessing the sovereign acts of a foreign government. Nevsun also took the position that the claims based on customary international law should be struck because they have no reasonable prospect of success.

The act of state doctrine is “a rule of domestic law which holds the national court incompetent to adjudicate upon the lawfulness of the sovereign acts of a foreign state” (R. v. Bow Street Metropolitan Stipendiary Magistrate, Ex parte Pinochet Ugarte (No. 3), [2000] 1 A.C. 147 (H.L.), at p. 269) (Lord Millett). The doctrine exists in Australian and English common law (with plenty of discussion) but is not part of Canadian common law. At 30 Abella J for the majority explains the connections and differences with the doctrine of state immunity.

The motion was dismissed by the Court of Appeal and the Supreme Court in majority has now agreed, arguing  (ia at 44-45)

The act of state doctrine and its underlying principles as developed in Canadian jurisprudence are not a bar to the Eritrean workers’ claims. The act of state doctrine has played no role in Canadian law and is not part of Canadian common law. Whereas English jurisprudence has reaffirmed and reconstructed the act of state doctrine, Canadian law has developed its own approach to addressing the twin principles underlying the doctrine: conflict of laws and judicial restraint. Both principles have developed separately in Canadian jurisprudence rather than as elements of an all‑encompassing act of state doctrine. As such, in Canada, the principles underlying the act of state doctrine have been completely subsumed within this jurisprudence. Canadian courts determine questions dealing with the enforcement of foreign laws according to ordinary private international law principles which generally call for deference, but allow for judicial discretion to decline to enforce foreign laws where such laws are contrary to public policy, including respect for public international law.

Nor has Nevsun satisfied the test for striking the pleadings dealing with customary international law. Namely it has not established that it is “plain and obvious” that the customary international law claims have no reasonable likelihood of success.

Of note is at 50 the insistence with reference to authority that ‘deference accorded by comity to foreign legal systems “ends where clear violations of international law and fundamental human rights begin” ‘, and the majority’s opinion’s references to the stale nature of the established concept that public international law exists for and between States only.

Clearly the case is not home and dry for the lower courts will now have to address the substantive issues and may still hold for Nevsun. Moreover claimant’s case is based on parts of international law traditionally considered ius cogens – of less use in other corporate social responsibility cases involving environmental issues or more ‘modern’ social rights other than the hard core ius cogens category. Hence in my initial view the precedent value of the case may not be as wide as one might hope. However the clear rejection of the act of state attempt is significant.

Of interest finally is also the judgment at 75 and at 109 citing Philippe Sands’ (KU Leuven doctor honoris causa) formidable East West Street in support.

Geert.

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

WOW! Supreme Court of Canada released decision in Nevsun case, the case will move forward, victory for claimants! Majority opinion: it is arguable that the breaches of customary international law, or jus cogens, relied on by the victims may apply to corporations https://t.co/L527vA7tEq

— Ekaterina Aristova (@EkatAristova) February 28, 2020

The judgment (in first instance; expect appeal) dismissing jurisdiction in Ismail Ziada v Benjamin Gantz is out in Dutch here and in English here. Gilles Cuniberti has reviewed the immunity issues here. I shall focus on the consideration of forum necessitatis, and can so do very briefly for the court does, too.

In essence the judgment on this point means that civil procedure rules on forum necessitatis do not set aside sovereign immunity based on public international law, and that the ECtHR judgment in Naït-Liman does not alter that finding. In that case, the ECtHR nudged States to consider a forum necessitatis rule:

‘“Nonetheless, given the dynamic nature of this area, the Court does not rule out the possibility of developments in the future. Accordingly, and although it concludes that there has been no violation of Article 6 § 1 in the present case, the Court invites the States Parties to the Convention to take account in their legal orders of any developments facilitating effective implementation of the right to compensation for acts of torture, while assessing carefully any claim of this nature so as to identify, where appropriate, the elements which would oblige their courts to assume jurisdiction to examine it.”

In Ismail Ziada v Benjamin Gantz the Court simply remarked that ECtHR authority on the issue all concerns immunity of international organisations not, as here, State sovereign immunity, in which consequently (in the court’s view) forum necessitatis does not have a role to play.

Geert.