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Le Tribunal de l’Union européenne annule la décision de la Commission sur des rulings fiscaux irlandais en faveur d’Apple

Nearly a year ago I reported on a Greek judgment refusing execution of two English orders issued on the basis of a High Court judgment which granted declaratory relief to the applicants. This came as a result of proceedings initiated in Greece, in breach of the settlement agreements and the exclusive jurisdiction clauses in favor of English courts. A recent judgment rendered by the same court confirmed the incidental recognition of the same High Court judgment, which resulted in the dismissal of the claim filed before Greek courts due to lack of jurisdiction.

Piraeus Court of Appeal Nr. 89/31.01.2020

THE FACTS

The facts of the case are clearly presented in the case Starlight Shipping Co v Allianz Marine & Aviation Versicherungs AG [2014] EWHC 3068 (Comm) (26 September 2014. The UK defendants invoked before the Piraeus first instance court the judgment aforementioned, and requested incidental recognition in Greece. The Piraeus court granted recognition, and dismissed the claim. The plaintiffs appealed, seeking reversal on two grounds: Lack of res iudicata and violation of Article 34 (1) Brussels I Regulation.

THE RULING

The Piraeus CoA founded its ruling on point 39 of the English judgment:

39. So far as the Hellenic settlement agreement is concerned, clause 2 expressly provides that the payment of U.S.$4.8 million is “in full and final settlement of all and any claims they may have under the Policy in relation to the loss of [the vessel] against the Underwriters and/or against any of its servants and/or agents..” As with the CMI and LMI settlement agreements, that wording settles claims under the policy in relation to the loss of the vessel. Accordingly, by application of the reasoning of Longmore LJ in the Court of Appeal, as set out at [32] to [35] above, the claims against Hellenic in Greece are within the settlement and indemnity provisions in the Hellenic settlement agreement and in breach of the exclusive jurisdiction clause in the Hellenic settlement agreement and the arbitration clause in the underlying Policy…

Res iudicata and public policy

The Piraeus court had no difficult task in establishing the finality of the English judgment: It simply referred to the certificate issued by the English court.

The public policy defence was also considered as unfounded, by reference to Article 35 (2 and 3) Brussels I Regulation.

No anti-suit injunction order

It then stressed out that the foreign judgment solidifies the exclusive international jurisdiction of English courts, without ordering the claimants/appellants to refrain from filing an action or moving ahead with the proceedings before Greek courts, by imposing any measures for this purpose. Hence, the court continues, the foreign judgment in question fulfils the criteria under Article 32 Brussels I Regulation, and therefore it is not considered as an anti-suit injunction, because it does not hinder the Greek court to examine their jurisdiction. For the above reasons, the English judgment may be incidentally recognized, which means that the Greek court is bound by its findings on the international jurisdiction issue. Finally, it should be underlined that no reference to the Gothaer  ruling of the CJEU was made by the Piraeus court.

Clarifications

Finally, the Piraeus court explained the reasons which led to a different outcome from that of the judgment issued by the same court a year ago. First of all, the court was not bound by the res iudicata of the 2019 judgment, because the defendants were not the same. Secondly, the 2019 judgment examined an application for the enforcement of the English orders, whereas in the present case the subject matter was the existence or non-existence of the choice of court clause.

For all the above reasons, the appeal was dismissed.

SHORT COMMENT

Following the case law of the CJEU on anti-suit injunctions, and the non-recognition of the orders, which were labelled by the 2019 judgment as ‘quasi’ anti-suit injunctions, the defendants used the seemingly sole remaining tool for avoiding a re-examination of international jurisdiction on the merits by the Greek courts; the outcome proves them right. The question however remains the same: Are declaratory orders stating that English courts have exclusive jurisdiction and that proceedings in other Member States are in breach of an English exclusive jurisdiction agreement in line with the mutual trust principle? In his thesis [pp. 146 et seq.], Mukarrum Ahmed  argues that those orders are at odds with the above principle.

The Greek Supreme will have the final word.

Of course, a preliminary request remains a possibility.

Kamalia Mehtiyeva (Paris I Panthéon-Sorbonne School of Law) has just published a monograph on the Concept of Judicial Cooperation based on her doctoral thesis (La notion de coopération judiciaire, LGDJ, coll. Droit privé, préf. L. Cadiet, vol. 597, 2020).

The author has provided the following abstract in English:

The diversity of legal orders and their multiplication have led to a growing need to articulate them. In addressing this need, mechanisms of coordination proper to private international law (rules of conflicts of laws and of jurisdictions, lis pendens), based on passive logic in which one legal order holds back in favor of another, reveal to be insufficient.

Parallel to these mechanisms emerged, in a disorganized manner, a whole heteroclite set of more active methods of interaction, both during judicial proceedings and upon their completion, such as mission rogatory, service of process, extradition, European arrest warrant, seizure of assets, Interpol red notices, enforcement of foreign judgments and arbitral awards. The doctoral thesis gathers these diverse mechanisms under the banner of judicial cooperation, not only in order to seek unity behind the apparent diversity, namely by distinguishing a common procedural foundation as well as similar, or at least consistent powers of judges mutually assisting each other, but also to suggest punctual improvements of certain instruments by analogy with features of other mechanisms.

The thesis first strives to analyze diverse mechanisms of judicial cooperation between judges of European Union member states (e.g. European arrest warrant, recognition and enforcement of civil and criminal judgments, European investigation order, obtaining evidence in the European Judicial Area), as well as outside of the European Union (e.g. letters rogatory, service of process, obtaining evidence, extradition, recognition and enforcement of judgements) and interactions between judges and arbitrators (e.g. assistance of the State judge – “juge d’appui”, recognition and enforcement of arbitral awards). The second part of the doctoral thesis is focused on unveiling the unity of the notion of judicial cooperation by defining its criteria and its essence. Thus, behind the analysis of diverse mechanisms of cooperation between national legal orders with each other and with arbitral legal order, as well as in the European order by virtue of the principle of mutual recognition, and the concrete proposals of improvement of some of them, the book reveals a profound unity of the notion of judicial cooperation.

The unity first appears in the criteria of cooperation in so far as it is defined as procedural act, freely accomplished in one legal order upon the request of another legal order for the needs of judicial proceedings with a cross-border element, pending or terminated in the latter. The thesis explains cross-border element not in a usual, geographical sense, characterized by territorial borders, but in a broader one, marked by the limits of jurisdiction of a legal order (national, European or arbitral legal order). Furthermore, the thesis allows to trace a common basis for all types of mechanisms of judicial cooperation, which is reciprocity of relations between legal orders. In that respect, the thesis shows that such reciprocity is rooted in interactions between legal orders, even if it may be stronger between national legal orders belonging to the European Judicial area, as their relations are characterized by mutual trust. Finally, the unity is found in the purpose of judicial cooperation which manifests differently for requesting and requested legal order. For requesting legal order, the purpose of judicial cooperation is obvious : it is to obtain aid from another legal order where the requesting judge is not allowed to act either because of foreign judicial sovereignty (foreign legal order) or its incompetence (arbitral order). As to the requested judge, the purpose behind its action is less clear. The thesis shows that judicial cooperation is a way for the requested judge to contribute to a better management of cross-border litigation.

The study thus reveals that judicial cooperation transforms the core of judicial powers which are no longer reduced to adjudicating cases falling into the scope of  competence of the legal order to which judges belong but is henceforth enriched to include cooperative function(“office coopératif des juges”). The requested judge’s cooperation allows the requesting judge to surpass a cross-border element in the proceedings and thus contributes to a better administration of justice of the requesting legal order.

More details are available here, including free access to the table of contents and the first few pages of the book.

La Cour européenne des droits de l’homme (CEDH) conditionne la violation de l’article 3 de la Convention au délai durant lequel les requérants demandeurs d’asiles ont été placés en incapacité de répondre à leurs besoins essentiels et l’absence de réponse adéquate des autorités étatiques.

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La chambre sociale se prononce sur la portée de l’immunité de juridiction des États étrangers en présence d’un litige de travail, en se référant à l’article 6 de la Convention européenne des droits de l’homme et au droit international coutumier.

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Practice shows that we’re far away from a perfect world of cooperation between state authorities in the field of cross-border service of process. This post is not about a judgment dealing with the matter (yet). It is what we call a ‘true story’, and serves as a kind of case study, to understand the variety of unprecedented situations with which courts may have to deal with.

The Facts

A Greek company filed an action against a foreign company, situated in an EU Member State. The claim, its translation, and an application pursuant to Article 4 of the Service Regulation were duly sent by the Transmitting to the Receiving Agency. The latter forwarded the claim to a process server for the purpose of serving the action to its recipient. Following fruitless efforts, the bailiff returned the documents to the court of the state of destination, stating that the respondent was not found in the given address. In particular, so his report, there was no indication that the company had its office there, and no person representing the company or any employee was found in the building. In accordance with domestic law on civil procedure, a hearing took place in camera on the request for service. The court stated that, following official information received, the respondent’s registered seat and postal address was in fact the same with the one stated in the claim form. As a result, and pursuant to Article 50(2) of the Code of Civil Procedure, the documents must be attached to the file, and service shall be deemed as duly made.

On the basis of the above conclusions, the court ordered that a certificate of service in accordance with Article 10 Service Regulation be issued, which should be delivered to the Transmitting Agency, with a true copy of the process server report attached.

The Receiving Agency abided by the order, and issued the above certificate, by making use of the standardized version in Greek. The person in charge filled in the following data: The date and address of service [12.1] in the language of the State of destination, and the method of service [12.2.1.3], i.e. pursuant to Article 50(2) of the Code of Civil Procedure, again in the language of the State of destination. The above person ticked also the box under 12.3, which demonstrates that the recipient was informed in writing that he may refuse to accept the document if it is not translated in a language he understands or the official language of the place of service. Finally, the place, name and capacity under which the above person drafted and signed the document were again written in the language of the state of destination. No court stamp is visible in the certificate.

What Would You Do if You Were the Greek Judge?

As I mentioned before, the case is still pending, and the claimant’s lawyer is seriously apprehended whether the documents aforementioned suffice for proving that service has taken place in accordance with the Service Regulation.

There are a number of critical points to be discussed in this case.

1. Is the Greek court entitled to return the certificate, because it was not completed in the languages accepted by the Hellenic Republic (Greek / English / French)? It is true that the receiving Agency made use of the standardized document in its Greek version; however, the crucial data were completed in the language of the State addressed, which is different from the languages declared by Greece).

2. Is the Greek court entitled to challenge the service of process, even if the document was served by a method prescribed by the internal law of the Member State addressed for the service of documents in domestic actions upon persons who are within its territory? According to Greek law, if the process server does not find anything or anyone related to the recipient in the given address, service by publication must follow.

3. Is the Greek court entitled to ask at this stage for a particular method of service, because the one chosen by the foreign court is violating the rights of the defendant? Article 7(1) of the Service Regulation does not give a clear answer in this respect.

4. Is the Greek court entitled to ask at this stage for further scrutiny by the Receiving Agency, so that the document is actually served to the defendant or one of its representatives? I fear that this won’t be accepted by the Receiving Agency, simply because service has taken place in accordance with its domestic rules.

5. If the Greek court considers that service was proper, because it was served by a method prescribed by the internal law of the Member State addressed: was it effected in sufficient time to enable the defendant to defend? I anticipate that the Greek court will consider that service was not timely, and therefore order a stay of proceedings.

Finally, an additional and purely domestic problem comes to the surface for the claimant. According to Greek law, and with respect to cases tried in the so called ordinary proceedings, service of process abroad has to be completed within 60 calendar days following filing of the claim. Failure to do so leads to dismissal of the claim as inadmissible. Filing and service has to be repeated. In the case at hand, the claimant passed already through this ordeal, because service of the first claim was not timely completed, i.e. not within the 60-days term. Now comes the second challenge and the claimant’s lawyer is at a loss…

In Colouroz Investment et al [2020] EWHC 1864 (Ch.), Snowden J at 59 ff considers the classic issues (see ia Lecta Paper) on the jurisdictional issue: no cover under the Insolvency Regulation; cover under Brussels Ia (future Brexit alert: ditto under Lugano) left hanging and assumed arguendo. At 62 Snowden J summarises the position excllently:

‘(T)he court has usually adopted the practice of assuming that Chapter II of the Recast Judgments Regulation applies to schemes of arrangement on the basis that the scheme proposal is to be regarded as a “dispute” concerning the variation of the existing relationship between the company and its creditors under which the company “sues” the scheme creditors as “defendants” seeking an order binding them to the scheme.  If, on the basis of that underlying assumption, the court has jurisdiction over the scheme creditors pursuant to Chapter II of the Recast Judgment Regulation, then there is no need for the Court to determine whether that assumption is correct.

At 64: ‘Credit Agreements and the ICA (Intercreditor Agreement, GAVC) were originally governed by New York law and were subject to the exclusive jurisdiction of the New York Court. However, as a result of the amendments made on 2 June 2020 with the consent of the requisite majority of the lenders under the contractual amendment regime, the governing law and jurisdiction provisions have now been changed to English governing law and English exclusive jurisdiction.’ At 65: expert evidence on NY law suggests amendments made on 2 June 2020 are valid and binding as a matter of New York law.

This to my mind continues to be a fuzy proposition under the Rome I Regulation: change of lex contractus by majority must beg the question on the relevant provisions under Rome I. As far as I am are, this hitherto has not been driven home by anyone at a sanction hearing however it is bound to turn up at some point.

At 66 Snowden J, who gives consent for the sanction hearing, announces that one issue that will have to be discussed there is that if the Schemes are sanctioned, the intention is to have the jurisdiction clauses then changed to asymmetric jurisdiction clauses, detailed in 21-23: lenders will be entitled to bring proceedings against the obligors in any jurisdiction although any proceedings brought by the obligors must be brought in England. At 66 in fine: ‘that question is not for decision at this convening hearing, but should be considered at the sanction hearing.’

That’s a discussion I shall look forward to with interest.

Geert.

(Handbook of) EU Private International Law, 2nd edition 2016, Chapter 2, Chapter 5.

 

#Restructuring.
Schemes of arrangement. Involves US, UK, contintental EU corporations.
Convening hearing approved.
Contentious issue of future change to assymetric choice of court deferred to the sanction hearing. https://t.co/OU9MqYdVFX

— Geert Van Calster (@GAVClaw) July 13, 2020