Flux Belges et Lux

In Boettcher v Xio (UK) LLP & Ors [2023] EWHC 801 (Comm)  Eggers DJ ultimately rejected ia a forum non conveniens challenge viz a claim for damages for misrepresentations allegedly made to induce claimant to enter into a contract of employment with the First Defendant. In his decision he considered ia the role to play for the application of the (retained) Rome II Regulation.

[109] There was substantial dispute between the parties as to whether the applicable law was English law in accordance with A12(1) Rome II (culpa in contrahendo), alternatively A4(1) Rome II  (on claimant’s case), or German law in accordance with A(1) (on defendants’ case).

[110] The judge holds there is a good arguable case (with final judgment on lex causae to be discussed at trial [110](4)) that English law is the applicable law, however I do not find his arguments very convincing. [110](1)

the damages claimed by Dr Boettcher for the alleged misrepresentations arose as a result of his entering into the contract of employment with Xio UK, in particular his claims for loss of earnings and damages for mental distress and/or disappointment and/or reputational damage. It was therefore his entry into the contract of employment with Xio UK, and his subsequent employment with Xio UK, in reliance on the alleged misrepresentations which constituted the relevant damage.

This, I would suggest, is plainly wrong. The alleged misrepresentations are the delictus committi; the formation of the contract (held with reference to Dicey 35-026 to have taken place in England) is the fallout of the delict. Yet it does not constitute its ‘direct damage’. The damage, as also seemingly formulated in the claim, are loss of earnings and damages for mental distress and/or disappointment and/or reputational damage. Seeing as claimant’s earlier employment for which he left currently litigated one, was overwhelmingly connected to Germany, where he also seems to have the core of his financial interests (the location of claimant’s bank account is too readily dismissed [110](2) as not being relevant), Germany would seem to have a lot going for it in terms of the lex causae, or at the very least a Mozaik of German (for loss of earnings) and English law (for mental distress), which I do not see readily displaced by English law as one applicable law under Article 4(3) Rome II.

Article 12’s culpa in contrahendo rule is correctly held [110](3) not to apply to relevant parties.

There are other factors that led to the forum non challenge not succeeding, however I do indeed think that the applicable law issue requires further consideration at trial.

Geert.

Failed jurisdictional challenge ia on forum non conveniens grounds, with consideration ia of Rome II applicable law

Boettcher v (Xio (UK) LLP & Ors [2023] EWHC 801 (Comm)https://t.co/dE6jE9mJfV

— Geert Van Calster (@GAVClaw) May 3, 2023

In FX Claims v Natwest Markets ECLI:NL:RBAMS:2023:1789, the first instance court at Amsterdam has rejected jurisdiction against the non-Dutch incorporated defendants (from the UK, the US, and Switserland) in a follow-on cartel damages case triggered by the European Commission’s decisions re manipulation of Forex Trading (known as Three Way Banana Split, Essex Express, and Sterling Lads, after the chatrooms in which the rigging was organised).

Stichting FX Claims was established by the US law firm that acts as third party litigation funder.

[6.3] the jurisdictional analysis takes place under Brussels IA for the Dutch-incorporated anchor defendant, Lugano II (referred to by the court as EVEXII) for the Swiss-incorporated defendant, and residual Dutch rules for all the others. However other than for the anchor defendant, the test is always the same (Dutch residual PIL instructs (see the Dutch Supreme Court in ‘Moldavia’) the courts to assess the claims using EU rules and CJEU authority): whether the claims against all defendants are so closely connected so that the sound administration of justice suggests it is expedient to hear them together, unless the claim is solely brought for the purpose of taking the defendant concerned away from their natural, domicile jurisdiction. Claimant resorts ia to the economic unit theory from EU competition law (see eg CJEU ENI) to support its anchoring unto a Dutch corporate vehicle of Natwest.

However [6.19] the Dutch Natwest SPV at the time of the infringements was not a direct daughter of the Natwest vehicle to whom the EC Decisions were addressed, and the claimant’s attention to the anchor defendant’s activities in their claim, is far underdeveloped [6.20]. With both the legal and the factual circumstances of anchor defndant being so radically different to those of the other defendants, the court finds [6.23] that the claims against it or not ‘closely related’ let alone so closely related so as to trigger expediency of joinder.

[6.31] Claimant’s argument that the cartelists’ activities concerned the whole of the EEA, including The Netherlands, is found not to suffice to identify Handlungsort (locus delicti commissi) in The Netherlands, neither [6.36] to locate locus damni Erfolgort in The Netherlands (here the court referred to CJEU CDC, flyLAL, and Volvo Trucks: damage needs to be shown for each individual claimant) other than for 3 of the parties represented in the claim, who have their corporate domicile in The Netherlands.

[6.37] a call upon the effet utile of the Damages Directive 2014/104 is rejected for that Directive is held not to include jurisdictional rules.

Finally the Stichting [6.43] attempts to establish jurisdiction under the Dutch forum necessitatis rule, referring to the practical challenges in suing outside the EU, the impossibility for non-EU, including UK courts to refer if need be to the CJEU (compare, in subsidiary fashion, Butcher J in Mercedez-Benz), the high costs involved in claiming in the UK, and, again, the effet utile of the Damages Directive. None of these impress the court which, referring to the need to apply forum necessitatis strictly, referring to there not being a serious suggestion that no fair trial will be guaranteed in the UK, and to the absence in EU statutory law or CJEU authority of a rule that EU competition law claims ought to always be judged by a court in the EU.

The judgment illustrates that much as the anchor defendant mechanism offers interesting opportunities, it cannot be used opportunistically.

Geert.

EU Private International Law, 3rd ed. 2021, Heading 2.2.13.1.

1st instance Amsterdam rejects jurisdiction viz most defendants in financial services follow-on cartel damages claim
Claims v anchor defendant found not to be 'related'
Handlungsort, Erfolgort not in NL
No forum necessitatis

FX Claims v Natwest Markets eahttps://t.co/9dwpjVnRzG

— Geert Van Calster (@GAVClaw) April 19, 2023

In Mercedes-Benz Group AG & Anor v Continental Teves UK Ltd & Ors [2023] EWHC 1143 (Comm)  Butcher J set aside permission for service out of the jurisdiction (against EU-incorporated defendants) in a follow-on damages claim following the European Commission’s Hydraulic Braking system cartel findings.

The UK parties are the anchor defendants. Pre-Brexit, the case against the non-UK defendants would have been brought under A8(1) Brussels Ia and the abuse threshold per CJEU CDC would have undoubtedly not been met.

The attractive UK discovery rules were mentioned by claimants as an important reason to anchor the case in the UK. On that point [25] the judge held per Spiliada‘s instruction [as a general rule, the court will not be deterred from granting a stay or refusing permission to serve out simply because the claimant will be deprived of a ‘legitimate personal or juridical advantage’, such as damages on a higher scale or a more generous disclosure regime, unless it is shown through cogent evidence that there is a risk that substantial justice will not be done in the natural forum] that substantial justice could not be done in Germany, if it was an available forum.

Butcher J overall [26] held that Germany is an available forum (in the case of the German defendants by reason of both A4 and A7(2) [locus delicti commissi] Brussels Ia, and in the case of the UK defendant by reason of the German forum connexitatis rules), with which the dispute has its closest and most real connexion, and which may be described as the natural forum for the present dispute.

The nature of the infringing conduct, causation and damage all overwhelmingly took place in Germany, witnesses largely have German as their mother tongue. [51] counsel for claimants makes an interesting point that matters of convenience ought not to weigh in favour of cartelists (essentially a nemo auditur application), however, the judge holds that ‘in relation to the matters which will be in issue, there has been no finding that Mercedes are right, or the Defendants wrong.

Further and importantly [albeit only as an additional argument: [57]: ‘I should state, however, that I do not regard this factor as decisive. My conclusion on the natural forum would have been the same without it’], [56] the judge with respect to applicable law points to the disadvantage of England and Wales given the impossibility to refer to the CJEU

While the courts of England and Wales are obviously very used to applying EU law, and until recently did so as being directly applicable, it is the case that since the UK’s withdrawal from the EU, UK courts cannot make preliminary references to the CJEU in respect of questions of the interpretation of EU law. While the Claimants say that a reference to the CJEU in respect of the interpretation of a Settlement Decision would be unusual, it cannot be said to be unprecedented.

Conclusion [58]

I am of the clear view that the forum with which the dispute has its closest and most real connexion is Germany, which is the natural forum for the dispute. The case has, in reality, very limited connexions with England and Wales, and it is not one, unlike very many which come before this court, where the parties have consensually chosen England and Wales as the forum for their disputes. The case has, by contrast, strong (and certainly much stronger) connexions with Germany.

Geert.

Jurisdiction refused
Follow on claim for damages viz EC Hydraulic Braking Systems cartel decision
Held forum non conveniens points to Germany

(pre Brexit jurisdiction would have been beyond doubt)

Mercedes-Benz v Continental Teves [2023] EWHC 1143 (Comm)https://t.co/e520HgxtvZ

— Geert Van Calster (@GAVClaw) May 16, 2023

I reported earlier on the jurisdictional issues in a case where PIFSS brings claims for sums totalling in the region of US$874 million, arising from the alleged corruption between 1994 and 2014 of its former Director General. In The Public Institution for Social Security v Al Wazzan & Ors [2023] EWHC 1065 (Comm), Henshaw J held early May that documents held in Switzerland must be disclosed, in application of disclosure rules under English civil procedure.

The disclosure concerns a large file of documents held by the Swiss Federal Prosecutor’s Office (SFPO)  arising from its investigations of Mr Al Rajaan and Ms Al Wazzan (Mr Al Rajaan’s widow) since 2012, and other documents held by Swiss-based entities or individuals, or located in Switzerland, or originating from and obtained under compulsion in Switzerland.

Disclosure was ordered, with a small caveat [161] which will see future specific measures (eg restriction of disclosure to counsel) be taken to ensure disclosure of the SFPO file documents to PIFSS does not create a risk of transmission to the State of Kuwait, which in turn might be viewed as sidestepping the State of Kuwait’s pending Mutual Legal Assistance (MLA) request to Switserland for the purpose of the continuing criminal proceedings in Kuwait.

Justice Henshaw’s lengthy considerations do justice to two restraints on disclosure, under English CPR for use in English proceedings. The principal approach is [43 ff; and [47] in particular with reference to Bank Mellat v HM Treasury [2019] EWCA Civ 449] that questions of disclosure and inspection are part of the law of procedure and are therefore matters of English law as the lex fori ; duties of confidentiality (which, if breached, may result in sanction) arising under foreign law do not provide an automatic basis to withhold disclosure and inspection. They are a matter for the judge’s discretion, and disclosure is only not ordered where the party shows that the foreign law is regularly enforced, so that the risk of prosecution is real.

[51] the judge holds that comity considerations are an independent element to consider, and in the process refers to its neat definition in Dicey’s 16th ed § 7-002:

“The United [States] Supreme Court famously said in Hilton v Guyot, a case on the recognition of foreign judgments: “‘Comity,’ in the legal sense, is neither a matter of absolute obligation, on the one hand, nor of mere courtesy and good will, upon the other. But it is the recognition which one nation allows within its territory to the legislative, executive, or judicial acts of another nation, having due regard both to international duty and convenience, and to the rights of its own citizens or of other persons who are under the protection of its laws.”

An interesting judgment raising several relevant issues (including one side-issue on the tardiness of the Hague Taking of Evidence rules).

Geert.

Following part successful jurisdiction challenge ( https://t.co/wncyM6RxZ1) now issues of disclosure under English CPR of Swiss-held documents

Lex fori rules for procedure, but with assessment of prosecution risk under lex rei sitae (SW), and of comityhttps://t.co/UR87IVj4AE

— Geert Van Calster (@GAVClaw) May 9, 2023

Regular readers will be aware that disciplining the use of the anchor defendant mechanism is not an easy task for a court to undertake (I have linked to one post yet the search tag ‘anchor’ will take you to plenty). The CJEU takes a restrictive view. Although in the case at issue Article 8(1) Brussels Ia does not formally apply (the mechanism does not apply to defendants domiciled outside the EU), instruction in Dutch residual rules is that they be applied as A8(1) would.

In Stichting Claim Gran Petro v Shell Netherlands, Shell Brasil and Raizen ECLI:NL:RBDHA:2023:7099, the Hague court of first instance did though refuse jurisdiction against the one Brazilian defendant (Raisen), anchored unto two Dutch Shell entities (Shell now having moved domicile exclusively to England was held [5.2] not to have relevance on account of the perpetuatio fori principle), citing abuse of the anchor defendant mechanism.

Shell have a majority share in Raisen. The claimants in essence called upon the corporate structure of Shell and, pro inspiratio, hoped to convince the court that the presumption of involvement of mother corporations in their daughter’s anti-competitive shenanigans might be enough to justify the relatedness of the claims. Such assumption exists in EU competition law (see eg CJEU ENI) however the court finds that claimants have not been able to prove a Brazilian equivalent.

The court refers ia to CJEU CDC v Azo Nobel et al to emphasize the condition that the anchor mechanism must not be intended merely to remove the defendant at issue from its natural domicile forum. [6.7] the court reports that the claimants acknowledge that Dutch jurisdiction is sought for reasons of  general tardiness of Brazilian proceedings. There is no suggestion that Raizen will not be willing to meet any future damages. Seeing as no presumption under Brazilian law of mother corporation involvement exists, and seeing as no proof of factual involvement of the Shell mother entities was furnished, [6.16] the court concludes that the anchor mechanism at issue is an abusive application and must not lead to jurisdiction.

Geert.

1/2 Follow-on competition law damages claim, after Brazilian competition commission finding of abuse
Held no jurisdiction against BRA corp controlled by Shell
Abuse of Dutch equivalent of anchor defendant mechanism, citing CJEU authority pro inspiratio

— Geert Van Calster (@GAVClaw) May 17, 2023

On 15 May an Antwerp justice of the peace (effectively a first instance judge in ia neighbourly disputes) has issued a common sense, no nonsense judgment against 3M’s pollution for its PFAS pollution of the soil around its manufacturing site at the Port of Antwerp. (For background to PFAS aka per and polyfluoroalkyl substances see also my earlier post on applicable law). PFAS produced there were mainly used in fire extinguishing foam.

Bypassing the sluggish criminal law and public law investigations and enquiries, and in view of alarming levels of PFAS found in the family’s blood, two immediate neighbours at the site claim against 3M on the basis of what is effectively common law nuisance. Such a claim is one of strict liability: it does not seek to establish fault or negligence, rather it aims at addressing the imbalance in proprietary enjoyment.

The judgment reminds us that the historic roots of many an environmental law (think Rylands v Fletcher (1868) LR 3 HL 330 and later Cambridge Water Co Ltd v Eastern Counties Leather plc [1994] 1 All ER 53 ) are still good law despite the overwhelming body of local, regional, federal, EU and international environmental statutory laws.

3M (other than to internal civil procedure rules on the court’s jurisdiction) referred ia to its environmental permit and to its use of ‘state of the art environmental technologies; to the distinction between the statutory remediation duty on the one hand and the liability for pollution, on the other; to its voluntary phasing out of PFAS at the site, and to the soil remediation (negotiated with /imposed by the Flemish authorities) it will carry out ia on the claimants’ property ; to the inconclusiveness of data on long-term health impact; and to the need to at the least stay the case in light of ongoing criminal and public law investigations.

The judge held that claimants’ individual rights exist independently of public and criminal procedures and may be enforced separately, and that all four elements for the laws of nuisance are present:

Neighbourliness (the only element not contested by 3M);

Nuisance. For the existence of nuisance, the judge referred ia to statements aka ‘extrajudicial confessions’ made by 3M executives during hearings in the Flemish Parliament;

Excessive nuisance. The nuisance is also held to be excessive, with simple reference ia to clearly abnormal PFAS readings in claimants’ blood;

Attributable to 3M. Here, too, the judge holds straightforwardly: ia mapping ordered by the Flemish Government shows a clear concentration of PFAS on the sites run by 3M.

The judge concludes with a provisional statement of €2,000 damages for the reduced enjoyment by claimants of their property.

The judgment does not indicate the parameters to be used for final determination of damages. Early commentary on the judgment indicates a number of open questions, such as the parameter within which claimants can be considered to be ‘neighbours’, etc. It is clear that 3M will not just appeal, but will generally continue its approach of litigating each and every claim (of note is that Belgium’s collective proceedings provisions are not optimal, and moreover difficult to apply to common law nuisance cases) with convoluted legal reasoning and much distinguishing. Yet the judgment is appealing in its straightforwardness and no doubt inspiring to the many proceedings which, sadly, are en route in this sad episode of industrial ‘innovation’.

Geert.

Vereerd me in het gezelschap van @omgevingsrecht te vinden in @vrtnws berichtgeving over #3M https://t.co/sXXjZq0rYh

— Geert Van Calster (@GAVClaw) May 17, 2023

 

Last July, I posted about a joint webinar between the Singapore-based Asian Business Law Institute (ABLI) and the Permanent Bureau of the Hague Conference on Private International Law (HCCH) on the Choice-of-Court and Judgments Conventions. The two organizations return this year with their third joint session, this time on the 1965 Service Convention.

Titled Cross-border Commercial Dispute Resolution – HCCH 1965 Service Convention, the webinar will take place on Tuesday 27 June between 4 to 5:10pm (Singapore time) or 10 to 11:10am (CEST), and is expected to discuss, among others, the actual operation of the Service Convention in practice, how the Service Convention works with the other HCCH Conventions for cross-border dispute resolution, and Singapore’s accession to and upcoming implementation of the Service Convention.

Invited speakers include Sara Chisholm-Batten (Partner, Michelmores LLP), Melissa Ford (Secretary, HCCH), Delphia Lim (2Director, International Legal Division, Ministry of Law, Singapore), Professor Yeo Tiong Min (Singapore Management University), and Professor Yun Zhao (University of Hong Kong and Representative of Regional Office for Asia and the Pacific, HCCH).

For more information or to register, click here. Early bird discount is available until 28 May.

Queries about the webinar can be directed to Catherine of ABLI at info@abli.asia.

Geert.

 

Nicholls & Anor v Mapfre Espana Compania de Seguros y Reaseguros SA [2023] EWHC 1031 (KB) yet again discusses the evidence and procedure carve-out in Rome II and its relationship with A12 Rome II ‘scope of the law applicable’. In the absence of a possibility to refer to the CJEU, a Court of Appeal intervention might be useful.

Pandya v Intersalonika [2020] EWHC 273 (QB) held that proceedings were time-barred per Greek law (lex causae), where the claim form was issued in the E&W courts before expiry of Greek limitation period, but was not served until after that expiry. A narrow reading of the A1.3 carve-out was confirmed in Johnson v Berentzen [2021] EWHC 1042 (QB)) and in Bravo & Ors v Amerisur Resources Ltd (Re The Amerisur plc Putumayo Group Litigation) [2023] EWHC 122 (KB).

In Duffy v Achmea [2020] EWHC 3341 (QB) it was held that interim payments are within the evidence & procedure exception; in Troke v Amgen [2020] EWHC 2976 (QB) interest payments, ‘because they are discretionary under Spanish law (the lex causae)’, were held to fall under the A1.3 exclusion. Sedgwick v Mapfre concluded the same (albeit on better reasoning IMHO) That seems to also have been the approach in Woodward -v- Mapfre, unreported but referenced in current judgment by Spencer J.

Eventually however the judge does not follow Troke or Sedgwick, holding [30] that  the recovery of interest provided for by Spanish law under Article 20 of the Spanish Insurance Act is, pursuant to Rome II and as a matter of European law, substantive, not procedural. In essence, the relevant foreign law rate of interest is said to be a matter of clear relevance to the remedy (financial compensation) to which the claimant is entitled, being intrinsically connected or linked to the award of financial compensation.

His reference [30](1) to the suggestion that A12′ applicable law provisions needs to be construed widely and A1’s carve outs narrowly, is wrong in my opinion. [31] He clearly suggests he might have referred to the CJEU had that been possible (although I do not necessarily agree that the CJEU would then have looked for a ius commune approach across the EU).

Even though he finds fault with the application of the rules by the lower courts, his calculation of awards are the same and the appeal fails.

Geert.

EU Private International Law, 3rd ed. 2021, Heading 4.8.

Evidence & procedure carve-out under the Rome II Regulation
Recovery of interest held NOT to be substantive right, lex causae, rather procedural remedy, subject to lex fori

Nicholls ea v Mapfre Espana Compania de Seguros y Reaseguros [2023] EWHC 1031 (KB)https://t.co/ZF8dGQvEjf

— Geert Van Calster (@GAVClaw) May 5, 2023

This short post on Agora v SPA Italiana Lastre ECLI:FR:CCASS:2023:C100265 at the French SC could suffice with referring to para 2.331 of the Handbook. That para asks exactly the question on which the SC has now referred to the CJEU:

The insertion into the Regulation of the lex fori prorogati rule often does not assist. In particular, where parties expressly make choice of court non-exclusive (non-exclusive choice of court), or where they designate a plurality of specifically identified courts, the lex fori prorogati is not immediately ascertainable.[1] Neither is it in the event of so-called ‘unilateral’ or ‘one-sided’ choice of court, which I review below. In my opinion, therefore, at the very least for these cases which are not solved with the new lex fori prorogati rule, parties are best advised to continue to (or start to) make separate and express choice of law for unilateral and non-exclusive choice of law.

[1]               An argument also made by counsel for the defendants in Commerzbank Aktiengesellschaft v Liquimar Tankers Management Inc [2017] EWHC 161 (Comm).

Please refer to François Mailhé’s post who has background to the issues here, referring ia to Banque de Rothschild. Note that Mary Keyes edited a whole volume on asymmetric aka hybrid aka unilateral choice of court.

Like François I do not think the CJEU will entertain all the questions referred. I cannot imagine it finding the very acceptability of unilateral choice of court to be covered by Article 25. That is simply not within the Article’s remit. (The CJEU might make an exception for the issue in those consumer contracts not covered by the protective regime of Brussels Ia, eg pure contracts of transport; here it might refer to secondary EU consumer law on unfair terms).

I do also wonder whether the Court will say anything about recital 20’s odd inclusion of renvoi, and whether parties may take away the uncertainty by designating a specific lex causae for the choice of court clause, and in doing so may also exclude renvoi (the answer to both in my view should be ‘yes’).

Geert.

EU Private International Law, 3rd ed. 2021, 2.331.

Agora v SPA Italiana Lastre

French SC refers to the Court of Justice of the EU on the application of A25 Brussels Ia's lex fori prorogati rule, in the event of hybrid aka asymmetric choice of court

(Effectively referring (2.331) of the 3rd ed of the Handbook). https://t.co/tHJVnTCLii

— Geert Van Calster (@GAVClaw) April 18, 2023

Boughajdim v Hayoukane [2022] EWHC 2673 (Fam) is a good case to illustrate qualification as an essential part of the private international law exercise. I had the case as one of the many open windows on my desktop. Despite my tardiness in reporting, I still do so, seeing as it is exam season and students are likely to start grapling with the course materials.

Core question is whether the Petitioner’s (the wife) divorce petition should be allowed to proceed in E&W, based on a marriage that has been recognised by the Moroccans court and registered in Morocco pursuant to legislation designed to provide retrospective recognition of marriage in that jurisdiction. The retrospective element is the result of the (alleged) spouses, of which the husband has dual Moroccan-UK citisenship, becoming aware that the absence of a marriage certificate was precluding an application for British Citizenship for one of their children.

The wife argues that the lex loci celebrationis in this case is Morocco, that the formal validity of the marriage falls to be determined by reference to the local form under Moroccan law and that this court is dealing with a valid foreign marriage, acknowledged as such by a foreign court and affirmed following failed proceedings by the husband for perjury and on appeal. By contrast, the husband contends that a proper analysis of the lex loci celebrationis means that the formal validity of the marriage falls to be determined by reference to the domestic Marriage Acts. In this context, he submits that the Moroccan marriage cannot be recognised as valid in E&W either as to form or as to capacity, the husband submitting in respect of the latter that the law governing questions of capacity is, in any event, the law of the husband’s domicile, under which law the husband did not validly consent to the marriage. Finally, the husband argues, in any event, that in the context of the special character of marriage there are cogent reasons for refusing to recognise the Moroccan marriage on the ground of public policy.

There is a convoluted procedural background to the case which this post does not engage with, for it is not relevant to the outcome of current judgment. (This also includes nb a number of res judicata elements, held [98], arising out of concurrent Moroccan proceedings.  Clearly, whether or nor there was a valid marriage at all is of relevance for all sorts of reasons, including financial ones.

[85] English law [like much of the world, GAVC] distinguishes between the form of the marriage (formal validity), which is governed by the lex loci celebrationis and the questions of capacity to marry to marry (essential validity, aka material or substantive validity). It is well settled that in English PIL the question of the capacity to marry is determined by the law of the party’s antenuptial domicile (Dicey Rule 75; note the contrast with continental Europe which tends to opt for lex patriae). Note however that what part of the validity question is a formal one and what part a substantive one, is not unequivocally clear. In E&W, there is no authority that conclusively answers the question of which system of law will govern the question of consent to marriage, i.e. whether consent is a matter of form governed by the lex loci celebrationis or a matter of capacity governed by the law of domicile.[86]

MacDonald J holds [90]

that the lex loci celebrationis in this case is the Kingdom of Morocco. I am further satisfied, on the facts as I have decided them, that the parties complied with the local form in the lex loci celebrationis sufficient for the court to be satisfied that it is dealing with a valid marriage having regard to the principle of locus regit actum. Further, I am satisfied that the husband has not demonstrated to the satisfaction of the court in this case that grounds exist for refusing to recognise the Moroccan marriage on the basis of public policy. In the circumstances, I am satisfied that the wife’s petition can proceed.

A difficultly is [100] that neither party contends for a marriage ceremony, or any other celebratory event, on an ascertainable date or at an ascertainable place giving rise to a marriage. The wife relies on the operation of a retrospective statute in a foreign jurisdiction as having constituted a valid marriage. There was no ‘marriage ceremony or other similar celebration’: then wat is the locus celebrationis? [105] The existence of a course of conduct by which some but not all of the legal steps necessary to conclude a marriage in a jurisdiction in which a ceremony is not required might, depending on the facts of the case, also assist in identifying whether there is a lex loci celebrationis and its location in a case concerning the operation of retrospective marriage legislation. Here, the judge decides that in 2000, on the balance of probabilities, the husband proposed marriage to the wife in Morocco, that there was an engagement party held, that there was a dowry agreed and paid and that the wife and husband considered themselves to be engaged and were to be married.

[114] ff the judge holds Moroccan formal procedure (including an element of service) following the retrospective Act, was properly complied with.

[139] ff and much more briefly, consent by both parties is established.

Finally [148] the ordre public exception looks at the consequences in England and Wales of recognising the decision of a foreign court that a marriage subsists as the result of retrospective legislation in respect of a British Citizen domiciled in E&W. [149] The Judge holds that the marriage to which the husband now objects arose by operation of law as the result of legal proceedings in respect of which, as the court has found, he was aware, in which he was represented, in which he had the opportunity to make representations and in which he did make, albeit cursory, representations objecting to the relief sought by the wife.

In conclusion, an earlier pronounced stay on the divorce petition was lifted.

A good case to illustrate qualification and its consequences.

Geert.

In Autostore Technology AS v Ocado Group Plc & Ors [2023] EWHC 716 (Pat), Claimant AutoStore is a Norwegian company, pioneer in automated warehouse technology. First defendant develops automated systems for use in large scale grocery businesses.  The second defendant is a joint venture between the first defendant and Marks & Spencer. Ocado is a former customer of AutoStore’s.

Ocado’s defences include that the patents were invalid due to prior non-confidential disclosures to two parties based in Russia, including EVS, a company based in St Petersburg, and Russia’s central bank.

‘Matter made available to the public’ is part of the ‘state of the art’ condition for patents (in the UK: s.2(2) of the 1977 Act). It may affect the novelty or obviousness of a patent: Subsections 2(1) and (2) of the Patents Act 1977 (“the 1977 Act”) provide:

“2. (1) An invention shall be taken to be new if it does not form part of the state of the art.

(2) The state of the art in the case of an invention shall be taken to comprise all matter (whether a product, a process, information about either, or anything else) which has at any time before the priority date of that invention been made available to the public (whether in the United Kingdom or elsewhere) by written or oral description, by use or in any other way.”

In support of their case of lack of novelty and inventive step Ocado rely on alleged prior disclosures to the Russian entities which Autostore say were made in confidence and could not therefore be part of the state of the art.

The section of the judgment that is of relevance to the blog (other than the brief reference to the TRIPS agreement [256]), is the qualification of the obligation not to disclose matter to the public, as (non)contractual, and the subsequent application of Rome II.  Hacon J summarises the issues [263] ff

Where a party relies on an express contractual restriction on the foreign disclosure of information, the effect of the alleged contract will be assessed according to the applicable law.  The party asserting the contractual restriction is obliged to plead the existence, the circumstances of formation and the relevant terms of the contract.  An English court seised will apply Rome I to determine which foreign law governs the contract.  The court will then decide whether, according to that law, there was an express term of confidentiality as alleged and whether its effect was to restrict the use of the information in issue.

The position is not so straightforward where it is said that a party in a foreign context was restrained from using information under an obligation that was not contractual – what an English court would recognise as an equitable obligation.

Rome II does not expressly recognise equitable obligations as a separate category. Clearly however they may still qualify as ‘non-contractual’.

[270 ff] Hacon J justifiably rejects Ocado’s assertion that Rome I and II dovetail. It is beyond doubt that not all obligations that are not contractual, must necessarily be covered by Rome II and vice versa.  Likewise, the overall application of Rome II clearly may imply non-contractual obligations that are putative. Meaning for the purposes of the application of Rome II, one may have to pretend for the time being that there are non-contractual obligations at play and that these are covered by Rome II, only for the so identified substantive lex causae to decide that there are not, after all, any non-contractual obligations at play.

Re the alleged disclosures made by the Bank, [276 ff] AutoStore’s primary contention is that the hypothetical breach of the alleged equitable obligation of confidence is correctly categorised as a culpa in contrahendo within the meaning of A12 Rome II, seeking support ia in CJEU Ergo. [286] It argues the respective obligations of confidentiality arose in the context of negotiations (with the Russian companies) which ultimately led to the conclusion of the Distribution Agreement governed by Norwegian law.  Consequently, the same law applies to the obligations of confidentiality.

However upon consideration the judge holds [298] – with much support found in prof Dickinson’s Rome II volume and his contribution on Rome II in Dicey’s 16th ed – that A12 does not apply to the alleged disclosures by the Bank, seeing as in his view A12 does not apply to third parties to the contractual negotiations, even agents of the contracting parties. There were no negotiations between AutoStore and the Bank and AutoStore for its own reasons wanted to ensure that any agreement reached would be with EVS and not the Bank.

Instead, [324] ff, the lex causae is held to have arisen out of an act of unfair competition within the meaning of A6 of Rome II. That is important, for Article 6 does not have an escape clause like Article 4(3).

Here, the judge’s reasoning is under par.

Oddly for instance he holds A6(2) is not engaged ia [335] ‘because the Bank is not a competitor of AutoStore’s’ yet he nevertheless applies A6(1): ‘the law applicable to a putative obligation of confidence on the Bank was the law of the country where competitive relations or the collective interests of consumers are, or are likely to be, affected.’: this is not convincing.

Reference is then made by the judge to CJEU Verein für Konsumenteninformation v Amazon EU Sàrl , CJEU Volkswagen and to Celgard, and to the Mozaikbetrachtung present in particular in the latter case. However he then [351] holds that ‘attention must be paid to the hypothesis posited in this case. It is that the Bank was about to make Bank Bot Designs public or had already done so’, subsequently linking that [353] to the procedural relief Autosore would have hypothetically sought for the potential breach, in, the judge holds, Russia. Conclusion [354]: ‘Of the laws made applicable under art.6(1) of Rome II to apply to the question of confidentiality, the one that would have mattered on the hypothesis raised would have been Russian law.’ That link to procedural relief to me comes out of nowhere.

As for the relationship with EVS, [301] the question arises as to whether AutoStore and EVS contemplated a contractual relationship at the relevant times. The judge [302] holds that a theoretical possibility of the purchase of goods or services or of some other contractual relationship does not suffice to trigger A12: commercial parties are almost constantly on the look-out for such relationships. [322] after having considered the various arguments the judge holds that A12 is engaged vis-a-vis EVS, yet that the putative law of the contract cannot be determined by A12(1), hence requiring the application of A12(2)(a). The applicable law is the law of the country in which damage would hypothetically have occurred, here, it is held, Russia.

Applicable law for both claims having been held to be Russian law, the remainder of the judgment then deals with evidence of that law and the conclusion [396] that the information was disclosed without imposing any obligation of confidence on either EVS or the Bank.

As noted the A6 analysis in my view is appealable. For both the A6 and the A12 analysis it is also a pity and concern to see, once again, the English courts (chicken and egg-wise led of course by counsels’ probable absence of presentation of same) lack of engagement on issues of both acquired and retained EU conflict of laws, with scholarship outside of the UK and /or other than written in English.

Geert.

Equitable obligations of confidence (in context of patent DNI Denial of Infringement): whether covered by retained Rome I or Rome II (or neither)
More on the blog when I find time

Autostore Technology AS v Ocado Group Plc & Ors [2023] EWHC 716 (Pat)https://t.co/ixzMwrPqJH

— Geert Van Calster (@GAVClaw) April 15, 2023

In Poland v LC Corp BV, the Amsterdam first instance court mid-March refused Poland’s application for an anti-suit injunction, which would have prohibited LC Corp from seeking UNCITRAL arbitration under the now defunct Poland-Netherlands BIT, with London as curial seat.

The case echoes that of Kingdom of Spain v Blasket Renewable Investments LLC, in which the Amsterdam Court had earlier declined to hear an anti-suit injunction petition by Spain to prevent renewable investors from enforcing arbitral awards in the US: see Josep Galvez’s summary here. That case however in the meantime has encountered quite the opposite reaction from a US judge, who held end of March that Spain enjoys sovereign immunity in the case and that as a result of the CJEU’s Komstroy’s authority, neither Spain nor the defendant had power to sign up to arbitration, hence dismissing the petition to confirm an arbitral award rendered pursuant to the Energy Charter Treaty.  In turn, that decision is in contrast with earlier orders in 9REN v the Kingdom of Spain and NextEra v the Kingdom of Spain as Curtis summarise here. The Court of Appeal will now hear those issues.

The case, as Geraldo Vidigal reminded me, is also reminiscent of the interlocutory decision in ECLI:NL:RBAMS:2022:5772, also involving Poland yet in that case with an anonymised Dutch corporate defendant. In that judgment the arbitration procedure was suggested as the currently only available way for the corporation to have its day in ‘court’, seeing as in the view of the judge, the Polish rule of law crisis  questions the impartiality of the Polish courts, and the EU’s alternative Investment Court is not yet operational. Johannes Hendrik Fahner discusses that case here.

In current case, the court first of all holds that Brussels Ia’s arbitration exception is not engaged, for the case’s core, it suggests, is whether the pursuit of an arbitration proceeding despite CJEU Achmea, constitutes abuse of process. The case, it holds (4.3) does not have the questions  put to the arbitral tribunal as its object, hence the arbitration exception is not in play. 4.5 the Court re applicable law holds parties have made choice of law for Dutch law under Article 14 Rome II, obiter suggesting that finding locus damni under Rome II Article 4(1)’s general rule is not self-evident: would the damage of an abusive pursuit of arbitration proceedings, be located in The Netherlands? It is not entirely clear to me why the Court discusses applicable law (other than Dutch courts having to do so proprio motu. 4.12 the court refers to the tribunal’s Kompetenz Kompetenz. The curial seat being located outside the EU, in London, is a crucial element in the court’s reasoning, despite CJEU Achmea: it is not prima facie clear that the tribunal will refuse to hear the case. Given the overall fog re the consequences of the CJEU case-law on extra-EU arbitration, the issues are not clearly without foundation hence cannot constitute abuse.

 

With recent Australian developments (blogpost imminent), even more proverbial ECT s**** is hitting the fan. IMHO this conundrum is not going to be solved by ever more procedural forum shopping with conflicting outcomes.

Geert.

CJEU #Komstory, #ISDS claxon
First instance Amsterdam refuses anti-suit against Dutch corporation in Poland-NL based UNCITRAL #arbitration with London as curial seat
Holds BIA arbitration exception is not engaged
More on the blog soon

Poland v LC CORP BV https://t.co/WOshDCgy15

— Geert Van Calster (@GAVClaw) March 14, 2023

I am on a break with the family until after Easter, hence only slowly treating myself to writing up blog posts. There are one or two in the queue, and I hope to be clearing them before long. ]

In C‑832/21 Beverage City & Lifestyle GmbH v Advance Magazine Publishers Inc. Richard de la Tour AG Opined a few weeks back. The claim is for trademark infringement between a US domiciled holder of an EU Trademark, and its EU suppliers in Poland and Germany. The AG suggest Article 8(1)’s joinder mechanism may apply in the case, provided the claimant in limine litis (at the start of proceedings) prove the anchor defendant’s role in the chain of infringements.

Background is the Union Trademark Regulation 2017/1001, which has separate rules on jurisdiction discussed in ia AMS Neve, however it leaves A8(1) Brussels Ia’s anchor defendant mechanism untouched.

(34) ff the AG uses the opportunity to clarify CJEU Nintendo,  with respect to Article 8)1)’s condition of ‘same situation in law’: the AG suggests the Court clarify that the application of different national laws as a result of intellectual property rights’ territorial scope, does not stand in the way of the situation being the same in law in the case of a Union trademark.

Next the AG discusses the issues also of relevance in ia CJEU C‑145/10 Painer, namely the question of sameness in fact, and argues for a flexible interpretation despite the defendants at issue not being contractually linked. He suggests inter alia that it would run against the intention of the Regulation to force the claimant into proving the anchor defendant be the main instigator of the infringement. Along similar lines, that the anchor defendant is not a corporation itself but rather one of its directors, with domicile in a different Member State, does not in the view of the AG prevent him being used as anchor defendant, provided (77) claimant prove at the start of proceedings that the director actively engaged in the infringement or should have known about it but did not stop it.

One can see merit in the AG’s approach in that it, as he also suggests, addresses the issue of abuse of the anchor defendant mechanism. On the other hand, this engagement with some of the merits of the case always raises the issue of how intensive that can /ought to be at the jurisdictional stage without leading to a ‘mini’ trial’. It may be preferable simply to hold that as a director of a corporation, one should not be surprised to be used as jurisdictional anchor for that corporation’s infringements, in one’s place of domicile.

Geert.

EU Private international law, 3rd ed. 2021, 2.482 ff.

Opinion Richard de la Tour this AM re anchor defendants, Article 8(1) Brussel Ia, infringement of Community Trademark

C‑832/21 Beverage City & Lifestyle GmbH v Advance Magazine Publishers Inc.https://t.co/yjOXA6OrbR

— Geert Van Calster (@GAVClaw) March 23, 2023

UBS’ bailout of Credit Suisse, arguably strong-armed by the Swiss State, will have had countless lawyers phoning investors, and countless investors lawyering up. I am no expert in banking and finance law, I am of course like everyone else aware that the anger is most visible in so-called AT1 bondholders. This blog is interested in the dispute resolution fall-out likely to rain down on various dispute resolution avenues for some time to come.

A quick flag that those considering litigation, will have a range of issues to ponder. Who to sue, for starters. The Swiss authorities might be a target, leading of course to considerations of immunity and, give the close involvement of the Swiss authorities in the rescue, of the qualification of the claims as ‘civil and commercial’ (echoes here of CJEU Kuhn etc, now under the Lugano Convention).

What litigation avenue to pursue, next: the bond holders will be subject to dispute resolution clauses, one imagines either with choice of court for Switzerland or providing for commercial arbitration. Depending on time and avenue of acquisition of the bonds, the holders may well argue they are not bound by such clauses, Further, a potential to use the route typically favoured by Swiss-headquartered multinationals, against other States: ISDS. Investor-State Dispute Settlement (with their ‘fork in the road’ provisions).

(Digital) Rolodexes the world over will be spinning by now. As and when this leads to litigation as suggested above, the blog will be reporting.

Geert.

 

 

On 21 April, Louvain-La-Neuve will be hosting a conference in honour of prof emeritus Marc Fallon. The general concept of the conference is included below (summary provided by prof Stéphanie Francq, one of the main organisers of the event). More info with full program and link for registration is here. This will be a thoughtFest for all interested in EU private international law and with working languages both English and French, it speaks to a broad audience.

Get thee to Louvain. Geert.

 

Why and for what purpose should European private international law be codified? This twofold question will be at the heart of the discussions on April 21, 2023, during a colloquium paying tribute to the remarkable work of Professor Marc Fallon in the fields of private international law and European law, and in particular to his involvement in the Belgian and European codification of private international law. How did we come to envisage a European codification of private international law? What do we expect from it? Does an EU codification have the same ambitions as national codifications? Do these ambitions not vary according to the place, the time and the context of international constraints imposed on the legislator? Does a codification at the European level, and at the present time, imply specific needs, challenges and consequences, even dangers, for both the national and the European legal orders? And above all, does it offer new prospects or hopes for the European project and for the discipline of private international law?

Jalla & Anor v Shell International Trading and Shipping Company Ltd & Anor [2023] EWHC 424 (TCC) is a follow-up of earlier, procedural (including jurisdictional) issues which I discuss here.

[1]-[2] The 2011 Bonga Spill emanated from an offshore floating production, storage and off-loading facility (“the Bonga FPSO”), located approximately 120 kilometres off the Nigerian coastline of Bayelsa State and Delta State within the Nigerian Exclusive Economic Zone. The Spill was caused by a rupture of one of the pipelines connecting the Bonga FPSO to a single point mooring system (“SPM”), both of which were operated and controlled by one of the defendants, Shell Nigeria Exploration and Production Company Ltd (“SNEPCo”), a Nigerian company regulated by the Nigerian governmental authorities. The technical manager of the vessel, the MV Northia, that was loading from the Bonga FPSO at the time of the spill was another defendant, Shell International Trading and Shipping Company Ltd, (“STASCO”), a company domiciled and registered in the UK.

Anchor defendant is STASCO. SNEPCo is co-defendant.

The High Court had determined that the claims for damage caused by the Spill  could not constitute a continuing nuisance until any pollution was remedied, so as to extend the limitation period and defeat the defendants’ limitation defence; it held claimants each had a single claim in nuisance in respect of any damage caused by the Bonga Spill, such cause of action accruing when their land and/or water supplies were first impacted by the oil. Claimants’ appeal against that part of the judgment as I reported earlier was dismissed by the Court of Appeal [2021] EWCA Civ 63  and this “Continuing Nuisance Appeal” is now being appealed to the Supreme Court.

[4] Current case is to determine the date on which actionable damage, if any, was suffered by the claimants as a result of the Bonga Spill, for the purpose of deciding whether any of the claims against the anchor defendant, STASCO, are statute-barred for limitation and, therefore, whether E&W courts have jurisdiction to determine the substantive claims. 

[39] Stuart-Smith J (as the then was), alongside the jurisdictional challenges, had further held that the High Court had no discretion to allow, or would refuse, amendment of the claim form to join STASCO and the amendment to add allegations against STASCO, if and to the extent that the applications were made after the expiry of the relevant limitation period. The allegations against STASCO in respect of its responsibility for the  were deemed by the court not to have been made until 2 March 2020.

[40] ff

The issue of jurisdiction as against SNEPCo, a Nigerian corporation, is dependent on there being a valid claim against STASCO, a UK corporation. The court rejected other jurisdictional challenges made by the defendants but was unable to finally dispose of the challenge to jurisdiction because it was subject to the outstanding issue as to whether the claims against STASCO were statute-barred. If the claims against STASCO, the anchor defendant, were statute-barred, there would be no basis on which service out of the jurisdiction against SNEPCo could be permitted and the court would have no jurisdiction to determine any of the claims.

Given the significance of the limitation issue, the court ordered that there should be a trial of preliminary issues to determine in respect of all claimants the date on which they suffered damage, the appropriate limitation period and limitation as a defence to the claims.

Parties agree that Nigerian Law applies to the claims relating to the spill, including the limitation period applicable to the claims (the case therefore does not engage with the outstanding issue of the treatment of limitation under Rome II, discussed most recently in Bravo v Amerisur Resources (Putumayo Group Litigation). The issue between the parties is whether the applicable limitation period is six years, as submitted by the claimants, or five years, as submitted by the defendants.

O’Farrell J holds that given the date of damage, none of the claims in these proceedings was made against STASCO within any applicable limitation period. Obiter, she holds on the limitation issue anyway.

The relevant law that applies in Nigeria is the (English) Limitation of Actions Act 1623 which provides for a limitation period of six years for claims that would amount to tortious claims. The National Assembly for the Nigerian Federation has not enacted any general limitation statute and no such provision is made in the Constitution. The State legislature for Delta State however has enacted a general limitation statute. Section 18 of the Limitation Law of Delta State 2006 (“the Delta State Limitation Law”) provides for a limitation period of five years for claims in tort. 

[306] Claimants’ position is that the limitation period applicable to their claims is the six-year period provided for by the 1623 Act. In the absence of specific federal legislation on this issue, they argue this residual provision is the limitation law generally applicable in Nigeria, including at a federal level, by virtue of section 32(1) of the Interpretation Act 1964; further, that the Delta State Limitation Law is inapplicable in the Federal High Court; only federal legislation can apply, irrespective of where the Federal High Court sits.

Further, [307], claimants argue they are entitled by Article 7 Rome II  to choose the law applicable in the Nigerian Exclusive Economic Zone (“EEZ”) as the lex causae governing their claims for environmental damage, as the country where the event giving rise to the damage occurred, the locus delicti commissi, Handlungsort. The EEZ falls within the control of the Federal Government of Nigeria; as such, it would be subject to the Nigerian Federal law of torts and the residual 1623 Act limitation period.

[308] Defendants’ position is that the limitation period applicable to the claims is the five-year period provided for by the Delta State Limitation Law. The relevant Federal High Court for the claims would be the Federal High Court in Delta State, as the place where the alleged damage occurred. They suggest Nigerian authorities on limitation confirm that if a local limitation law exists in the relevant state, that law applies to the claim; and the limitation statute of each state is territorial in scope. On that basis, the Delta State Limitation Law applies to any action brought in the territorial area of Delta State, including the Federal High Court in Delta State.

[309] viz A7 Rome II they argue the Nigerian EEZ is not a “country” for the purpose of Article 25(1) Rome II [‘“Where a State comprises several territorial units, each of which has its own rules of law in respect of non-contractual obligations, each territorial unit shall be considered as a country for the purposes of identifying the law applicable under this Regulation”], that it has no applicable limitation law and that it would not override the jurisdiction of the Federal High Court to determine the claims in these proceedings.

The judge [336] ff holds the country in which the alleged damage occurred is Delta State, making the law of Delta State the default choice of law under Article 4(1) Rome II; that although the claims are for environmental damage, and the event giving rise to the alleged damage occurred at the FPSO within the Nigerian EEZ, the EEZ is not a country within the meaning or A25(1): Nigeria is a Federation with 36 states plus the FCT of Abuja. The EEZ is not a territorial unit and does not comprise one of those states; and the EEZ does not have its own rules of law in respect of non-contractual obligations.

The remainder of the judgment deals with issues of proof of foreign customary law.

Interesting!

Geert.

 

Follow-up to https://t.co/XHZRWI7jOt
Considers limitation periods in Rome II (and impact on E&W jurisdiction), choice of lex causae in A7 Rome II (environmental damage), Nigerian regions as 'countries' under A25 Rome II

Jalla v Shell [2023] EWHC 424 (TCC)https://t.co/T8z2ERNUjd

— Geert Van Calster (@GAVClaw) March 7, 2023

The CJEU last week held in C-177/22 JA v Wurth Automotive. The case concerns the consumer title of Brussels Ia, in particular a refinement of the CJEU  C-630/17 Milivojević and C-28/18  Petruchová case-law (involvement of people with a background in the sector), C-498/16 Schrems (evolvement of use from non-professional to professional or the other way around) and  CJEU C‑464/01 Gruber criteria (dual (non-)professional use).

Applicant in the main proceedings, whose partner is a car dealer and managing director of an online platform for the sale of motor vehicles, was mentioned on the homepage of that platform as the graphic and web designer, without actually having carried out that activity at the time of the facts in the main proceedings. At the request of the applicant in the main proceedings, the partner did some research and contacted the defendant in the main proceedings from his professional email address, in which he indicated a price offer for the purchase of a vehicle. It was stated in that email that the contract of sale was to be concluded on behalf of the applicant in the main proceedings, however a little while after the purchase the partner enquired (but was rebuffed) about the possibility to indicate the VAT amount of the invoice (typically only of interest to business buyers).

Firstly, in applying the consumer title, must account be taken of current and future purposes of the conclusion of that contract, and of the nature of the activity pursued by that person as an employed or self-employed person? As for the latter, the CJEU answer [27] is clearly ‘no’, with reference to Roi Land Investments. As for the former, whether the purpose for the use is current or planned in the future, per Milivojević [88-89], is held by the CJEU not to be of relevance. I would personally add to both Milivojević and Wurth Automotive that any such future use must have been somehow signalled to the business. While the CJEU in Schrems confirmed the possibility to lose the consumer status as a result of subsequent professional use, it has not held (and in my view ought not to) that an initial professional use later changed to non-professional use, may belatedly trigger the consumer section (it has of course supported the later ‘internationalisation’ of the contract per Commerzbank).

Next, what is the burden of proof on whom, and what needs to be proven, when a good or service has been procured for dual professional and non-professional use. Here, the CJEU [30] ff confirms that first of all the professional use or not of the good or service needs to be established on the basis of the objective elements of the file. Only if “that evidence is not sufficient, that court may also determine whether the supposed customer had in fact, by his or her own conduct with respect to the other party, given the latter the impression that he or she was acting for business purposes, such that the other party could legitimately have been unaware of the non-professional purpose of the transaction at issue” [32].

[36] “the impression created by the conduct of the person claiming the status of ‘consumer’….on the part of the other contracting party, may be taken into account to establish whether that person should be afforded the procedural protection laid down in Section 4 of that regulation.”

In the case at issue,

[38] inaction following the presentation of a contract identifying the buyer as a trader, can constitute evidence (but not of singlehandedly determinative value) that the applicant in the main proceedings could have created, on the part of the defendant in the main proceedings, the impression that she was acting for professional purposes;

[39] ditto the sale of the vehicle shortly after the conclusion of the contract and [40] the potential making of a profit, albeit that the latter would in the view of the CJEU ordinarily not be of great impact.

The CJEU finally is not prepared (despite a self-confessed [47] in Wurth Automotive] potential to read same in CJEU Gruber) to read a benefit of the doubt, in inconclusive cases, to the benefit of the alleged consumer, leaving that with reference to CJEU TOTO to national procedural law. Here I think the Court could have held against such benefit on the basis of Brussels Ia itself.

Geert.

EU private International Law, 3rd ed. 2021, 2.231 ff.

 

CJEU this AM C-177/22 Wurth Automotive
Jurisdiction for consumer contracts, Brussels Ia
Non-objection to proposed B2B contract, Qs from purchaser's partner (professionally active in sector concerned) re VAT on invoice, do feed into 'consumer' qualificationhttps://t.co/SSEVaWHQiP

— Geert Van Calster (@GAVClaw) March 9, 2023

Parveen v Hussain [2022] EWCA Civ 1434 (I am still in clearing the backlog mode) is an excellent illustration of this most peculiar of issues under conflict of laws, the issue of ‘Vorfrage’, with the Court of Appeal ending up recognising the second marriage of a Pakistani lady, but not her prior foreign divorce expressed by her first husband per Talaq.

The Court of Appeal held that the fact that that divorce is not entitled to recognition under the English rules, does not mean that the woman did not have the capacity to (re)marry: her previous divorce was effective under the law of Pakistan.

Moylan LJ summarises that the issue raised by the appeal is in essence the relationship between capacity to marry rules and divorce recognition rules. [7]:

[In England and Wales] “a person’s capacity to marry is governed by the law of their antenuptial domicile. The recognition of a divorce, whether obtained in “the British Islands” (section 44) or in a “country outside the British Islands” (section 45), is governed by the provisions of the [Family Law Act] FLA 1986. What happens when the two are in conflict? In other words, when a person, in this case the wife, has capacity to marry by the law of her antenuptial domicile, Pakistan, but her previous divorce is not entitled to recognition in England and Wales under the FLA 1986, is priority to be given to the law applicable to capacity to marry or to the law applicable to the recognition of divorces.”

After a first marriage in Pakistan, which ended in 2008 by husband Talaq, the wife remarried. The second husband commenced divorce proceedings in 2018. This led to the pronouncement of a Decree Nisi of divorce in 2019. In or about August 2020, the second husband applied for the Decree Nisi to be rescinded and for the Petition to be dismissed on the basis that the wife remained married to her previous husband at the date of her marriage to the  second husband. The husband then issued a nullity Petition in 2021 in which he contended that at “the time of the marriage the (wife) was already lawfully married”. The wife submits that her marriage to the husband is valid because she had capacity to marry under the law of Pakistan which recognised her divorce as having validly determined her previous marriage.

[22] Per Akhtar v Secretary of State for Work and Pensions [2022] 1 WLR 421:

“Validity of Marriage

[60] Under English rules of private international law: (a) the general rule is that the formal validity (i.e. the formalities) of a marriage is governed by the law of the country where the marriage was celebrated, Dicey at para 17R-001; and (b) the general rule is that capacity to marry (or essential validity) is governed by the law of each party’s antenuptial domicile, Dicey at para 17R-057 (now 17R-054). Bigamy is “a matter of capacity”, Dicey at para 17-082 (now 17-079).

[61] If a marriage is valid in respect of both form and capacity it will be recognised as valid under English law and, as a result, the parties will be recognised as having the status of husband or wife.”

‘Bigamy’ is qualified as a rule of capacity to marry (‘essential validity’ or what the civil law is likely to call substantive validity. Extensive review followed of various authorities,  including the well-known Schwebel v Ungar, with the Court of Appeal as in that latter case, giving priority to capacity to marriage. An ordre public exception was rejected on the basis of the wife at all relevant times having been domiciled in and lived in Pakistan. [89] “The public policy objectives would be sufficiently achieved by denying recognition of the divorce to the wife’s previous husband because of his connections with the UK.”

A super case to teach Vorfrage, qualification and ordre public.

Geert.

An excellent illustration of Vorfrage
Relationship between capacity to marry rules and divorce recognition rules
Moylan LJ giving priority to the former, referring ia to Schwebel v Ungar

Parveen v Hussain [2022] EWCA Civ 1434 https://t.co/Tb1jSeCs9P

— Geert Van Calster (@GAVClaw) November 7, 2022

I last updated the draft for this post in November….I am hoping somewhat to catch up with posts this week.

In Transworld Payment Solutions U.K. Ltd, Re [2022] EWHC 2742 (Ch) Freedman J refused an application to set aside an order to serve out of jurisdiction. Claimants’ case is that the E&W proceedings arise out of an alleged “VAT carousel fraud”, carried out in England and Wales, by English and Welsh companies. There are concurrent Curaçao proceedings.

Defendants raise a forum non conveniens jurisdictional defence. They submit that the Curaçao court is presently seised as to the issue as to whether the companies were effectively parties to a number of settlement agreements, and the effect of the same.  These Settlement Agreements are subject to Curaçao law and contain a Curaçao jurisdiction clause (which is not exclusive).  They also submit that the fraud claims will be determined as part of the applications for negative declarations in the Curaçao Proceedings.  The Claimants dispute that the fraud claims or the full scope of the fraud claims will be determined in the Curaçao Proceedings.

There are significant areas of dispute between the parties as regards what is in issue in the Curaçao Proceedings. The issue that is of most interest to the blog, is the consideration of applicable law under Rome II. [79] Freedman J notes “VTB [VTB Capital Plc v Nutritek International Corp [2013] UKSC 5] ,was a case where English law (used as a shorthand to refer to the law of England and Wales) was the proper law of the tort, but where the majority of the court nonetheless stayed the action in favour of the matter being more appropriately litigated in Russia.”

A first issue is the catchment area of Rome II’s ‘non-contractual obligations’, to typically common law equitable wrongs including dishonestly assisting breach of trust/fiduciary duty. [83] the judge holds with reference to Dicey, Morris and Collins 16th Ed. that they likely do. [84] The most likely lex causae following Rome II is English law and  ‘(I)t seems unlikely that Article 4(3) would apply given the closer connection of any tort or delict with England and Wales rather than with Curaçao or any other country. ‘

The issues will be further discussed at trial and one imagines both Rome I and Rome II will return there. But for now, jurisdiction is going ahead.

Geert.

Largely unsuccessful application for forum non conveniens (viz: Curacao) set-aside of permission to serve out of jurisdiction
Considers ia applicable law Rome II viz deceit, conspiracy, equitable wrongs

Transworld Payment Solutions [2022] EWHC 2742 (Ch) https://t.co/ly6m6XRFsN

— Geert Van Calster (@GAVClaw) November 7, 2022

The first instance court of Gelderland held in X v Lufthansa that the latter’s limitation to objecting to territorial jurisdiction within The Netherlands, rather than to jurisdiction of the Dutch courts as such, amounts to submission under A26 BIa, leaving the Dutch courts to decide on territorial jurisdiction with reference to internal Dutch civil procedure rules (CPR).

The remainder of the judgment then agrees with Lufthansa on the basis of Dutch CPR identifying the defendant’s office or branch as the territorially relevant factor, leaving Gelderland without jurisdiction. The court seemingly rejected itself as forum contractus, holding that CJEU C-204/08 Rehder v Air Baltic does not apply due to the flight in current case not being intra-EU (final destination being Baku). I would have expected the court to consider C-20/21 LOT Polish Airlines, where the final destination equally was outside the EU.

I do not know what claimant argued (forum contractus one assumes, perhaps locus damni per A7(2) BIA?), at any rate it is wrong to hold that a limitation of jurisdictional objection to internal distribution, implies submission per A26 BIa, for those heads of jurisdiction which assign jurisdiction territorially, not just nationally. That includes A7 forum contractus and forum delicti.

Geert.

 

I should really keep this for exam purposes
First instance Gelderland holds opposition to court's territorial jurisdiction, not to NL jurisdiction as a whole, does not obstruct A26 Brussels Ia submission
Ahum…

X v Lufthansa ECLI:NL:RBGEL:2023:900https://t.co/QS53WEXmSp

— Geert Van Calster (@GAVClaw) March 4, 2023