EAPIL blog

Claimants suing multinational enterprises for business-related human rights abuses have recently had a good run in England. The Supreme Court cleared the jurisdictional hurdles for the claimants in Vedanta and Okpabi. This was followed by the Court of Appeal judgment in Begum and the High Court judgment in Josiya, which opened the door for value chain litigation. In Fundão dam, the Court of Appeal allowed a claim brought by over 200,000 Brazilians in the aftermath of the collapse of a dam in Brazil to proceed (meanwhile, the number of claimants has grown to 700,000, who are seeking £36bn in damages). And in Bravo, the High Court held that the law of a civil law country (Colombia) did not preclude the possibility of liability on the part of a parent company registered in England for the activities of its Colombian subsidiary. Although in Jallah (here and here), the courts held that a claim following an oil spill off the Nigerian coast was time-barred.

Business and human rights cases have even made their way to Scotland. The Court of Session (Outer House) allowed a claim brought by over 1,000 Kenyan tea pickers against a company registered in Scotland to proceed in Campbell v James Finlay (Kenya) Ltd.

Many other business and human rights cases, some of them quite innovative, are currently pending in English courts. All of this has cemented London’s reputation as a (and probably the) global centre for business and human rights litigation.

Ever since Brexit, however, there has been a sense that this type of litigation is running on borrowed time. The UK’s withdrawal from the Brussels system has expanded the use of forum non conveniens and, consequently, has significantly raised the risk of claims failing on jurisdictional grounds.

Limbu v Dyson Technology Ltd, in which the High Court (Deputy High Court Judge Sheldon KC) handed down its judgment on 19 October 2023, is the first post-Brexit case where this risk has materialised.

Facts

Dyson is a multinational enterprise specialising in designing and manufacturing premium household appliances. Its founder and chairman, Sir James Dyson, was a prominent Brexiteer. That is why he caused quite a stir when he announced in early 2019 that his company would move its headquarters to Singapore, although he stated that this move was ‘not linked to the departure from EU’. Dyson’s operational headquarters is now in Singapore, but its registered headquarters is still in England. Dyson has an elaborate value chain. Many of its suppliers are based in East Asia.

Two of Dyson’s suppliers are the Malaysian companies ATA Industrial (M) Sdn Bhd and Jabco Filter System Sdn Bhd. The claimants, who are migrant workers from Bangladesh and Nepal, were employed by the suppliers in their Malaysian factories. They allege that they were victims of various human rights abuses, including violations of labour standards by the suppliers and violations of human rights directly committed by the Malaysian police in which the suppliers were complicit. The claimants commenced proceedings against three companies that are part of the Dyson group, two of which are domiciled in England and one in Malaysia. No proceedings were commenced against the suppliers and the Malaysian police.

The claim was brought in negligence and unjust enrichment. Negligence is a well-known legal basis for remedying business-related human rights violations. The claim in this case builds on Begum and Josiya. The defendants’ duty of care is claimed to have originated from their control over the manufacturing operations and the working conditions at the suppliers’ factories, and out of their public declarations – in mandatory policies and standards – regarding upholding human rights in their value chain. Unjust enrichment is a relatively novel legal basis in this context. The essence of the unjust enrichment claim is that the defendants obtained an unjust benefit as a result of claimants’ circumstances. The claim was brought on 27 May 2022, which is well after the Brexit transition period ended on 31 December 2020. The Brussels I bis Regulation, therefore, did not apply.

The question before the court was one of jurisdiction. The court had jurisdiction over the English companies on the basis of their presence in England. The English companies, however, asked the court to stay the proceedings on the basis of forum non conveniens. The claimants sought permission to serve the claim form on the Malaysian company out of the jurisdiction. The defendants had not made an application to strike out the claim, nor had they made an application for summary judgment. The court, therefore, assumed that the claim was arguable and had a reasonable prospect of success. The claimants relied on the necessary and proper party jurisdictional gateway in relation to the Malaysian company. But was England the proper place in which to bring the claim? The Malaysian company sought to set aside the service of the claim form on the basis that England was not the forum conveniens.

The defendants made a number of undertakings to the court as to how they would conduct the proceedings if their application succeeded and the claim was brought in Malaysia. In essence, they undertook to submit to the jurisdiction of the Malaysian courts, to assist the claimants with some of the disbursements and costs, to agree to remote attendance at a hearing and the trial in Malaysia, and not to challenge the lawfulness of any success fee arrangement between the claimants and their Malaysian lawyers.

Judgment

The jurisdictional question was about forum non conveniens. Referring to Spiliada, the court said that the question had to be addressed in two stages. First, was England or Malaysia the natural forum for the litigation? Second, if Malaysia was the natural forum, where there any special circumstances by reason of which justice requires the trial to take place in England? In other words, was there a real risk, based on cogent evidence, that substantial justice would not be obtainable in Malaysia?

The court held that Malaysia was indeed the natural forum. The following factors in particular pointed to this conclusion: Malaysian law applied and the case raised novel points of law; and Malaysia was the centre of gravity of the case due to the harm and the underlying mistreatment occurring there. Interestingly, the availability of remote hearings and communication technology meant that the location of parties and witnesses was not regarded by the court as a particularly important factor.

The court then proceeded to Stage 2. It held that there was no reason for the trial to occur in England. The court found no cogent evidence that: migrant workers had no access to justice in Malaysia; there were no suitably qualified lawyers with necessary expertise who could team up in Malaysia; the proceedings in Malaysia would take too long; the disbursements to be paid by the claimants in Malaysia would be significant; the claimants could not find representation in Malaysia; the defendants or their lawyers would act outside the law, unethically or unprofessionally in Malaysia; it was inappropriate to rely on the defendants’ undertakings; the gaps in funding in Malaysia could not be filled by NGOs; and that partial contingency fee arrangements were unlawful or impracticable. In other words, there was no cogent evidence that the claimants would not obtain substantial justice in Malaysia.

Comment

Dyson is significant because it illustrates the effects of Brexit on business and human rights litigation in England. The combination of general jurisdiction under Brussels I bis and the CJEU’s judgment in Owusu no longer offers a safe jurisdictional haven for victims of business-related human rights abuses. It is clear from Dyson and the cases cited above that the natural forum is almost always going to be in the country where abuses and direct damage occur. There are cases, like Vedanta, where it is possible to prove that substantial justice cannot be obtained in the natural foreign forum. But, as Dyson shows, achieving this is difficult. Many alleged human rights abusers will benefit from this and, thus, collect a handsome ‘Brexit dividend’.

Nevertheless, Dyson has a silver lining. The court assumed that the claim was arguable and had a reasonable prospect of success because the defendants had not made an application to strike out the claim, nor had they made an application for summary judgment (see [18]). The judge reiterated, at [141], that it was reasonable to assume that the claimants had good prospects of success in their claims and would obtain substantial damages if successful. Furthermore, the claimants are likely to appeal and it is not inconceivable that the Court of Appeal might disagree with the judge on the forum non conveniens issue.

The Roma Tre University and the Catholic University of the Sacred Heart have jointly organised a conference titled The Italian Scholars and The Hague Academy of International Law – A retrospective on the occasion of the Academy’s Centennial Anniversary, under the patronage of the Italian Ministry of Foreign Affairs and the Hague Academy itself.

The conference, due to take place on 30 November 2023 in Milan, at the Catholic University of the Sacred Heart, will discuss the contribution provided by Italian scholars to the development of both public and private international law through courses delivered at the Academy since 1923.

A final roundtable will be devoted to the challenges that face, today, those teaching and researching public and private international law, including the law of international arbitration.

Speakers include: Giulio Bartolini, Tullio Treves, Luca Radicati di Brozolo, Robert Kolb, Sergio Marchisio, Marina Castellaneta, Francesco Salerno, Sara Tonolo, Pasquale De Sena, Beatrice Bonafè, Annamaria Viterbo, Paolo Palchetti, Chiara Tuo, Giuseppe Nesi, Jean-Marc Thouvenin, Attila Tanzi, Giuditta Cordero-Moss, Massimo Benedettelli, and Verónica Ruiz Abou-Nigm.

A detailed programme can be found here.

The working languages will be English, French and Italian, with Italian presentations being simultaneously translated into English.

Attendance is on-site only. Prior registration is required through the form available here.

As announced on this blog, the inaugural edition of the European Association of Private International Law Winter School will take place in Como between 12 and 16 February 2024.

Organised by the University of Insubria, in cooperation with the Jagiellonian University in Kraków, the University of Murcia and the University Osijek, this year’s edition of the Winter School will be devoted to Personal Status and Family Relationships.

The lectures, in English, will discuss a range of issues relating to the cross-border continuity of status, filiation, and family relationships between adults. Both Hague conventions and EU legislative measures will be examined, with an approach combining theory and practice. There will be ample room for interaction with (and among) the participants.

The teaching staff consists of Silvia Marino (University of Insubria, director of the School), Laura Carpaneto (University of Genova), Javier Carrascosa González (Universidad de Murcia), Ester di Napoli (University of Ferrara), Cristina González Beilfuss (Unversity of Barcelona), Satu Heikkilä (LL.D., Administrative Law Judge), Katja Karjalainen (University of Eastern Finland), Máire Ní Shúilleabháin (University College Dublin), Etienne Pataut (University of Paris 1), Paula Poretti (University of Osijek), Nadia Rusinova (Hague University), Raffaele Sabato (Judge of the European Court Human Rights), Ian Sumner (Tilburg University), Camelia Toader (former-Judge of the Court of Justice), Ioan-Luca Vlad (University of Bucharest), Michael Wilderspin (EU Commission Legal Advisor), Anna Wysocka-Bar (Jagiellonian University), Mirela Župan (University of Osijek).

The detailed programme can be found here.

The School is aimed primarily at law graduates, law practitioners and PhD candidates with an interest in private international law, EU law and human rights law.

Those interested in attending the School are invited to submit their application through this form before  25 January 2024.

Admission fees are as follows: early bird (by 12 December 2023): 180 Euros; ordinary: 250 Euros.

A reduced fee of 80 Euros is offered to one student from any of the Universities that are partners in the project  and one for a Ukrainian student.

For information: eapilws@gmail.com.

On 12 October 2023, the Court of Justice of the EU, following an Opinion of the Advocate General Sánchez-Bordona, handed down its long-awaited judgment in OP (C-21/22). The case concerns the application of the Succession Regulation to third States’ nationals, where a bilateral agreement is in place between the Member State whose authorities are seised and the third State in question.

The preliminary question originates from Poland, and represents the second attempt to seise the Court of Justice of the issue. In the OKR case, C-387/20, a similar question was raised by a notary public but the Court held that the request for a preliminary ruling was inadmissible.

Facts of the Case and Proceedings in Poland

OP is a Ukrainian national who resides in Poland and co-owns an immovable property there. OP wanted to draw up a notarial will in Poland choosing Ukrainian law as applicable to her future succession. The notary refused to do so on the ground that Article 37 of the 1993 Poland-Ukraine Bilateral Agreement does not provide for such possibility. In fact this Article states that:

Legal relationships in matters relating to the succession of movable property shall be governed by the law of the Contracting Party of which the deceased was a national at the time of his or her death.

Legal relationships in matters relating to the succession of immovable property shall be governed by the law of the Contracting Party in the territory of which that property is situated. (…)

OP brought an action before a court in Poland against the notary’s refusal. She argued that the 1993 Poland-Ukrainian Bilateral Agreement does not govern the choice of applicable law, and that, accordingly, a choice is admissible under Article 22 of the Succession Regulation. Article 75(1) of the Succession Regulation, which provides that the regulation does “not affect the application of international conventions to which one or more Member States are party at the time of adoption of this Regulation and which concern matters covered by this Regulation” does not prevent such a choice, she added, given that the 1993 Poland-Ukraine Bilateral Agreement is silent as to party autonomy in succession matters.

Put shortly, the view submitted by OP was that Article 21(1) and (2) of the Succession Regulation correspond to Article 37 of the Agreement, whereas Article 22 of the Succession Regulation, which allows for the choice of national law of the deceased, does not have any counterpart in the Agreement. As a result, Article 22 of the Succession Regulation is applicable (and enables the person concerned to make a choice of law) no matter whether the Bilateral Agreement takes precedence over the Succession Regulation. The domestic court, having doubts on the above view, submitted to questions to the Court of Justice of the EU.

Preliminary Questions and Answers of the Court

The first preliminary question was a straightforward one to answer. The domestic court wanted to know whether Article 22 of the Succession Regulation means that a third-country national residing in a Member State of the EU may choose the law of that third State as the law governing future succession case.

The Court of Justice answered in positive stating that a third-country national residing in a Member State of the EU may choose the law of that third State as the law governing his or her succession as a whole (OP, para. 24)

The answer to the second question seems far more interesting and important for the understanding and applying of the Succession Regulation.

The referring court asked whether Article 75(1) of the Succession Regulation, read in conjunction with Article 22 means that, where a Member State of the EU has concluded, before the adoption of the regulation, a bilateral agreement with a third State which designates the law applicable to succession and does not expressly provide for the possibility of choosing another law, a national of that third State, residing in the Member State in question, may choose the law of that third State to govern his or her succession as a whole.

In other words, the Polish court wanted to know whether OP may choose Ukrainian law as applicable to her succession in accordance with Article 22 of the Succession Regulation, while drafting her will in front of a notary public in Poland, even though 1993 Poland-Ukrainian Bilateral Agreement does contain conflict of law rules relating to succession and does not provide for any party autonomy to that respect.

The Court of Justice answered that Article 75(1) of the Succession Regulation read in conjunction with Article 22, in circumstances such as those of the case examined, does not exclude that a national of a third State, residing in the EU Member State, may be barred from choosing the law of that third State to govern his or her succession as a whole. The above is true provided that the Member State of the EU in question has concluded (before the adoption of that regulation) a bilateral agreement with that third State which designates the law applicable to succession and does not expressly provide for the possibility of choosing another law (see: OP, para. 38). Hence, theoretically, the Succession Regulation does not preclude a situation in which a Ukrainian citizen might not be able to choose Ukrainian law as applicable while drafting a will in front of a notary public in Poland.

Comments on the Judgment

In order to know whether the Succession Regulation applies one must examine its scopes, namely: (1) material one – it  covers succession to the estates of deceased persons (Article 1(1)); (2) territorial one –  it covers EU Member States, with the exception of Ireland and Denmark (Recitals 40, 41, the UK also never applied it) and (3) temporal one – it applies as of 17 August 2015 to the succession cases of persons deceased starting from that day (Art. 83(1) and 84 Succession Regulation). The Succession Regulation applies to succession cases covered by its scopes irrespective nationality or habitual residence of the deceased and irrespective where the assets of the estate are located. Hence, as rightly underlined by the Court of Justice, any person may choose applicable law in accordance with Article 22 of the Succession Regulation (not only an EU citizen). This follows also from the wording of Article 21 which provides for universal application of the conflict of law rules of the Succession Regulation.

Hence, the clou here lies not in the Chapter III “Applicable Law” of the Succession Regulation, but the 1993 Poland-Ukraine Bilateral Agreement. The Court of Justice therefore explained the meaning of Article 75(1) of the Succession Regulation. It underlined that where a Member State is a party to a bilateral agreement concluded with a third State (before the entry into force of the Succession Regulation), which contains provisions laying down rules applicable to succession, it is those provisions which, in principle, are intended to apply, instead of these of the Succession Regulation (OP, para. 27). In view of the Court of Justice, the Succession Regulation does not override these provisions simply because they do not provide for party autonomy and possibility of choosing applicable law by the testator (OP, para. 33).

It should be noted, however, that the Court of Justice while explaining that the bilateral agreement takes precedence before the Succession Regulation uses the expression “in principle” (see: OP, para. 27). Hence, this conclusion is of general, abstract character. It applies to every bilateral agreement and not necessary to this particular one and this particular case. Further, the Court of Justice states that “the scheme” of Succession Regulation “does not preclude a situation where, under a bilateral agreement concluded between a Member State and a third State (…), a third-country national residing in the Member State bound by that bilateral agreement does not have the right to choose the law applicable (…)” (OP, para. 37).

Nowhere in the judgment does the Court of Justice discuss the exact content of the 1993 Poland-Ukraine Bilateral Agreement. It does not say that 1993 Poland-Ukraine Bilateral Agreement excludes the possibility of choosing applicable law. It is left for the domestic court to analyze 1993 Poland-Ukraine Bilateral Agreement and finally decide.

The Hague Convention of 15 November 1965 on the service abroad of judicial and extrajudicial documents in civil or commercial matters is currently in force for more than 80 States.

All the Member States of the European Union are bound by the Convention. Most of them were parties to the Convention well before the Union was given the power to adopt measures concerning judicial cooperation in civil matters. Others joined afterwards.

Austria and Malta were the latest to do so. They respectively ratified and acceded to the Convention based on a Council Decision of 10 March 2016 whereby they were authorised (and in fact requested) to do so “in the interest of the Union”. The latter expression is used in cases where the Union considers it has the power to conclude an international agreement, but the agreement in question fails to include a REIO clause or is otherwise only open to States, meaning that the Union has no other option than to join the agreement through its Member States.

The Council Decision of 2016 was adopted on the assumption that the Union has external competence with regard to the Convention “in so far as its provisions affect the rules laid down in certain provisions of Union legislation or in so far as the accession of additional Member States to the Convention alters the scope of certain provisions of Union legislation”.

One such provision is Article 28 of the Brussels I bis Regulation. Article 28(2) stipulates that the court seised “shall stay the proceedings so long as it is not shown that the defendant has been able to receive the document instituting the proceedings or an equivalent document in sufficient time to enable him to arrange for his defence, or that all necessary steps have been taken to this end”. It is added in (3) that Article 19 of the 2007 Service Regulation (bow Article 22 of the Recast Service Regulation) applies instead of (2) where service occurred under the latter Regulation, and, in (4), that were the Union’s rules are not applicable, then Article 15 of the Hague Service Convention shall apply, “if the document instituting the proceedings or an equivalent document had to be transmitted abroad pursuant to that Convention”.

The stated existence of a Union’s external competence in this area has not prevented other uncertainties from arising. Specifically, the question arose of whether it is for the Union (and the Union alone) to take a stance on subsequent accessions to the Convention by third States.

Pursuant to Article 28 of the Convention, any State not represented at the Tenth Session of the Hague Conference on Private International Law (which took place in 1964) may accede to the Convention after the latter’s entry into force on the international plane. The Convention will then enter into force for such a State “in the absence of any objection from a State, which has ratified the Convention before such deposit, notified to the Ministry of Foreign Affairs of the Netherlands within a period of six months after the date on which the said Ministry has notified it of such accession”.

Put in another way, the Hague Service Convention offers the States that are already bound by it to veto the establishment of relations under the Convention between any acceding State and all of the Contracting States. So far, this “right of veto” has never been used in practice.

The Council of the European Union has recently discussed whether it is for the Union, or rather its Member States, individually, to decide about the line to take regarding the accession of Singapore to the Convention, which occurred on 16 May 2023.

Member States had apparently no difficulties in agreeing that there were no grounds, in substance, to issue such an objection. However, procedurally, while the majority took the view that the decision belonged to the Union, two States – France and the Czech Republic – expressed doubts in this regard, and abstained from the vote.

In a joint statement, France and Czechia noted that the other Member States agree that the Hague Service Convention falls under EU exclusive external competence, pursuant to Article 3(2) TFEU, but argued, for their part, that, “since the provisions of the Hague Convention on service do not apply in relations between Member States but only when a third State is involved, the possibility of affecting or modifying the common EU rules is doubtful”.

France and Czechia did not intend to prevent the Council from adopting an EU-wide approach to the accession of Singapore, but stressed they would not consider such a decision “as a precedent for any other accessions to the Hague Service Convention and other measures of the European Union that aim to regulate comparable subject matters, where exclusive external competence of the European Union could play a role but has not been agreed upon by the Member States”.

On 13 October 2023, Coreper issued a recommendation to approve the line to be taken regarding the accession of Singapore (the recommendation being that no objection should be raised), while acknowledging that the recommendation “is without prejudice to the procedure to be followed in the future to establish the European Union’s position concerning the accession of third States to such Hague Conventions which have the same accession mechanism as the 1965 Hague Convention”.

The issue, it is believed, may resurface, in particular, with respect to the Hague Convention of 18 March 1970 on the taking of evidence abroad in civil or commercial matters. The latter Convention, too, has special rules on the acceptance of accessions (Article 39), although their design and practical implications depart from the corresponding provisions of the Hague Service Convention.

Where England is not the natural forum for the trial of the substantive dispute, the English court should not, as a matter of policy or law, restrain proceedings in one foreign jurisdiction where the purpose of the injunction is to favour proceedings in another jurisdiction. In other words…it is no part of the function of the English courts to act as an international policeman in matters of this kind.

This well-known principle, set out by the House of Lords in Airbus Industrie GIE v Patel, does not apply to arbitration. This is the gist of the judgment of the Court of Appeal (Nugee LJ, Snowden LJ and Falk LJ) of 11 October 2023 in Deutsche Bank AG v RusChemAlliance LLC [2023] EWCA Civ 1144.

The facts are simple. A German bank issued a guarantee in favour of a Russian company, which was governed by English law and provided for arbitration in Paris. The Russian company commenced court proceedings in Russia. The German bank sought an anti-suit injunction (ASI) in England to restrain the Russian proceedings. English courts have the power to issue injunctions under section 37(1) of the Senior Courts Act 1981 ‘in all cases in which it appears to the court to be just and convenient to do so’. No such injunction could be obtained in France. Should the English court grant an ASI under these circumstances?

Allowing the appeal, the Court of Appeal gave a positive answer to this question. The court reasoned as follows. There is a serious issue to be tried on the merits. The claim falls within the gateway in Practice Direction 6B para 3.1(6)(c), namely a claim in respect of a contract governed by English law. ‘It is the policy of English law that parties to contracts should adhere to them, and in particular that parties to an arbitration agreement, who have thereby impliedly agreed not to litigate elsewhere, should not do so.’ ([38]) ‘Hence the Court will usually grant an ASI to enforce an arbitration agreement unless there is good reason not to’. ([39]) Since French courts cannot grant an ASI and French law ‘has no objection in principle to (and will recognise) the grant of an ASI’ in a case like this ([40]), England is the proper forum in which to bring the claim ‘for the interests of all the parties and the ends of justice’ (Spiliada). Consequently, all the conditions for service out were met. From this point, it was plain sailing. The court regarded ‘the application for an interim ASI as quite straightforward’ because the evidence showed that French law had no objection to this course of action ([42]). Just in case the Russian proceedings were not discontinued, the court also granted an anti-enforcement injunction.

Following the UKSC judgment in Enka, the arbitration agreement in Deutsche Bank AG v RusChemAlliance LLC was governed by English law. The authorities on which the Court of Appeal relied to support its argument about the policy of English law (UKSC/UKHL judgments in Ust-Kamenogorsk, West Tankers, Enka; EWCA judgment in The Angelic Grace [1995] 1 Lloyd’s Rep 87) all concerned arbitration agreements governed by English law. The court also relied on the English law of equity concerning the enforcement of contracts governed by English law ([38]-[39], [42]). This indicates that Deutsche Bank AG v RusChemAlliance LLC is most likely confined to arbitration agreements governed by English law (compare the outcomes in two similar cases, which provides support for this statement: Commerzbank AG v RusChemAlliance LLC [2023] EWHC 2510 (Comm) (arbitration agreement governed by English law; ASI granted) and G v R [2023] EWHC 2365 (Comm) (arbitration agreement governed by French law; England not the forum conveniens; ASI not granted)).

But the Court of Appeal’s broad statements of principles leave the door open for the argument that upholding all arbitration agreements is a general principle of English law and that, consequently, English courts should restrain foreign court proceedings commenced in breach of arbitration agreements, regardless of their governing law and arbitral seat, as long as the breaching party is present in England or the claim falls within a jurisdictional gateway, ASIs are not available in the courts of the seat, and the country of the seat has no objection in principle to ASIs. This would be a considerable extension of the powers of English courts and an unwelcome development.

In its Communication Ensuring justice in the EU – a European judicial training strategy for 2021-2024, the European Commission underlined the importance of European judicial training opportunities that enable legal practitioners to understand the role of EU law in their daily practice and to ensure that the rights and obligations stemming from EU law are respected in national judicial proceedings.

The European Institute for Public Administration (EIPA) and ICF are working to create and develop a series of e-learning courses (e-Capsules) for European practitioners on EU Civil Justice, Criminal Justice and Fundamental Rights for the European Commission Directorate-General for Justice and Consumers (DG JUST).

In order to identify the training needs and knowledge gaps all legal professionals within the 27 EU Member States are struggling with in the area of EU fundamental rights, civil justice, and criminal justice, EIPA and ICF have designed an online survey.

Those with an interest in these areas are invited to participate in the online survey that is available here in English, French, and German. The survey is meant to take approximately 10 minutes and can be completed over more than one session, if needed.

The survey is open until 31 October 2023.

Alex Mills and I are pleased to announce that, alongside the UCL Faculty of Laws Research Scholarships which are open to all research areas, this year we have an additional scholarship specifically for doctoral research in private international law. The scholarship covers the cost of tuition fees (home status fees) and provides a maintenance stipend per annum for full time study at the standard UKRI rate. The annual stipend for 2023/24 (as a guide) was £20,622. The recipient of the scholarship will be expected to contribute to teaching private international law in the Faculty for up to 6 hours per week on average, and this work is remunerated in addition to the stipend received for the scholarship.

We particularly welcome applications with research proposals that fall within our areas of interest, which are broad and include the following sub-topics within private international law: protection of weaker parties; environmental protection; business and human rights; sustainable development; digital technology; party autonomy; the relationship between public and private international law; private international law theory and/or methodology; colonialism; and private international law issues in arbitration and foreign relations law.

More information about UCL Faculty of Laws, our PhD programme, the process of applying and the scholarship is available here, here and here. Applicants should apply through the normal UCL Faculty of Laws PhD application process. All applicants within the relevant subject areas will be considered, but we recommend that applicants also specify in their application that they wish to be considered for these scholarships. The deadline date for applications for the 2024/25 academic year is 16 November 2023.

Prospective students are welcome to get in touch with either myself at u.grusic@ucl.ac.uk or Professor Mills at a.mills@ucl.ac.uk.

The Hague Academy of International Law has made known the programme of the summer course of Private International Law of 2024.

The course will be opened by Lord Lawrence Collins of Mapesbury (Former Justice at the United Kingdom Supreme Court) with a lecture on Use and Abuse of Comity in International Litigation.

The general course, titled The Metamorphoses of Private International Law, will be given by Charalambos Pamboukis (National and Kapodistrian University of Athens).

The special courses will be as follows: Jack Coe (Pepperdine Law School), Non-ICSID Convention Investor-State Awards in Domestic Courts; Andrew Dickinson (University of Oxford), Natural Justice in Recognition and Enforcement of Foreign Judgments; Carlos Esplugues (University of Valencia), New Dimensions in the Application of Foreign Law by Courts (and Arbitrators) and non-Judicial Authorities; Eva Lein (University of Lausanne), Breathing Space in International Contractual Disputes; Natalie Y. Morris-Sharma (Director at the Attorney-General’s Chambers Singapore), The Singapore Convention and the International Law of Mediation; Alessandra Zanobetti (University of Bologna), The Effects of Economic Sanctions and Counter-Measures on Private Legal Relationships.

The directors of studies will be Kubo Macák (University of Exeter) and Jacco Bomhoff (London School of Economics and Political Science) for the English-speaking section, Alain-Guy Tachou Sipowo (Université de Montréal) and Fabien Marchadier (University of Poitiers) for the French-speaking session.

All applicants are required to register online. A limited amount of scholarships is available. Registration period for full fee, scholarship, doctoral scholarship and Directed Studies applicants is between 1 November 2023 and 31 January 2024.

More information on the Academy’s programmes, including the upcoming Winter Course, may be found here.

This post was written by Mathilde Codazzi, who is a doctoral student at the University Paris II Panthéon-Assas.

In a judgment of 11 May 2023, the French Supreme Court For private and criminal matters (Cour de cassation) ruled that the requirement in the French civil code that the legal representatives of a child give their consent to his/her adoption, and which applies irrespective of the law governing otherwise adoption, is no ground for denying exequatur to a foreign adoption judgment.

Background

Two decisions rendered by the Nottingham Family Court on 17 March 2009 and two other decisions rendered by the London Family Court on 22 November  2012 granted the adoption of four children to an English national and a French and English national who entered into a civil partnership in 2003 and married in 2017. By a judgment of 17 December 2020, the French first instance court (Tribunal judiciaire de Nantes) granted exequatur to the four English decisions.

Court of Appeal

By a judgment of 25 October 2021, the Rennes Court of Appeal overturned the first instance decision on the ground that the legal representatives of the children, namely their biological parents, had not given their consent to the adoption.

Article 370-3 of the French Civil Code reads

The requirements for an adoption are governed by the national law of the adoptive parent or, in case of adoption by two spouses, by the law which governs the effects of their union. An adoption however may not be declared when it is prohibited by the national laws of both spouses.
Adoption of a foreign minor may not be declared when his personal law prohibits such an institution, unless the minor was born and resides usually in France.
Whatever the applicable law may be, adoption requires the consent of the legal representative of the child. The consent must be free, obtained without any compensation, subsequent to the birth of the child and informed as to the consequences of adoption, especially when it is given for the purpose of a plenary adoption, as to the full and irrevocable character of the breaking off of the pre-existing kinship bond.

According to the Court of Appeal, the requirement contained in Article 370-3 of the French Civil Code that they give their free and informed consent, notably regarding the irrevocability of adoption since the pre-existing bond of filiation is dissolved by a full adoption (“adoption plénière”), is a substantive provision of private international law which must be applied whatever the law applicable to the adoption may be and an essential principle of the French law of adoption. Hence the court concluded that the English decisions were not in conformity with French international public policy and should not be enforced, as their enforcement would deprive the French international public policy of its substance.

Supreme Court

The issue was thus to determine whether Article 370-3 of the French Civil Code, which requires that the legal representative of the child give their free and informed consent to the adoption of the child, can be opposed to the enforcement of a foreign adoption judgment if such consent was not obtained.

By a judgment of 11 May 2023, the French Supreme Court overruled the decision of the Court of Appeal on the ground that Article 370-3 of the French Civil Code may not be invoked against a foreign adoption judgment to prevent its exequatur.

In other words, the fact that the children’s legal representatives did not give their consent to the adoption ordered by a foreign judgment cannot be invoked against the enforcement of this judgment. This judgment confirms the already established solution according to which the violation of the requirement that the free and informed consent of the child’s legal representative is necessary for the adoption to be ordered pursuant to Article 370-3 of the French Civil Code cannot amount to a ground of refusal of enforcement of the foreign adoption judgment. The French Supreme Court had indeed ruled so in a judgment of 7 December 2016 about an Ivorian judgment. Article 370-3 only applies in French adoption proceedings.

On 16 November 2023 the Lyon 3 University will host a colloquium on the French Draft Code of Private international Law, organised by Ludovic Pailler.

The presentation of the colloquium reads as follows:

Following a mission statement, the working group charged with considering the codification of private international law, chaired by Mr. Ancel, submitted its report to the Minister of Justice on 31 March 2022. This was followed by a public consultation and the announcement, by the Minister of Justice, that the project would come to fruition. This codification has already been the subject of two scientific events at our establishment (i.e. Lyon 3 University). One was devoted to the code’s construction model, the other to its content (see here). The third event, to be held on 16 November 2023 in Lyon, concerns a comparative law analysis of the draft code. 

The colloquium is divided into two parts. The first examines codification from the point of view of European Union member states. Both the value of this exercise and the practical ways in which it is carried out will be explored. Does French codification differ from its foreign equivalents? Is it expected? Doesn’t it run counter to European Union law? The second part of the presentation will be devoted to the point of views from outside the EU, with a view to testing the stated ambition of enhancing the attractiveness of French PIL, and analysing it in the light of experiences or initiatives undertaken in contexts where the subject is in decline (United States) or less integrated (Brazil).

The list of speakers and chairpersons includes : Olivier Gout, Cyril Nourissat, Ludovic Pailler, Frédérique Ferrand, Patrick Wautelet, Eva-Maria Kieninger, Pietro Franzina, Daniel Petrache, Hugues Fulchiron, Gian Paolo Romano, Yoko Nishitani, Chris Whytock, Gustavo Ferraz De Campos Monaco and Sabine Corneloup.

The event will be held in French and in English.

For registration see here. The full programme is available here.

That London is a global capital for dispute resolution is well known. But even by London standards, Corinna zu Sayn-Wittgenstein-Sayn v His Majesty Juan Carlos Alfonso Victor Maria De Borbón Y Borbón is a spectacular litigation. Like in all complex international litigation, private international law has a role to play in this case. This is the aspect of the case that the High Court (Rice J) addressed in its judgment of 6 October 2023.

This case is complex, as is the High Court judgment, which spans 307 paragraphs or 92 pages. This post will present the key facts of the case, before addressing the four issues of relevance for private international law that the court addressed, namely submission to the court’s jurisdiction, Article 7(2) of the Brussels I bis Regulation, immunity under the State Immunity Act 1978, and the territorial scope of the Protection from Harassment Act 1997.

Facts

The defendant was King of Spain between 1975 and 2014, when he abdicated the throne. The claimant is an international businesswoman. Both parties have a cosmopolitan lifestyle and maintain homes around the world. The parties agreed that the defendant was domiciled in Spain for the purposes of the proceedings, even though he had been living in Abu Dhabi since August 2020. The claimant is a Danish national with a residence in Monaco and a home in England.

The parties were in an intimate relationship between 2004 and 2009. Their relationship came to public attention in April 2012 in the aftermath of an elephant-hunting trip to Botswana. In June 2012, the defendant paid €65m to the claimant, the purpose of which is a matter of dispute and controversy. Shortly thereafter the defendant allegedly started to harass the claimant. Harassment allegedly continued after the defendant’s abdication.

The facts pleaded by the claimant are complex, but are conveniently summarised at [259]:

the Defendant (a) intimidated and pressured the Claimant over the use of the June 2012 payment, (b) threatened and intimidated her more generally, (c) made allegations of stealing, untrustworthiness and disloyalty with a view to disrupting her relations with friends and family, (d) made similar defamatory statements to her clients and business associates, (e) supplied false information to the media, with a view to publication, relating to her financial probity and alleging she was a threat to the Spanish national interest and/or was trying to blackmail the royal family, and (f) placed her and her advisers under surveillance, trespassed onto and damaged her Shropshire property and intercepted or monitored the mobile and internet accounts of herself and her advisors.

These acts of harassment were alleged to have occurred in different countries, including Austria, the Bahamas, England, Monaco, Saudi Arabia, Spain, Switzerland, Tahiti, United Arab Emirates, and the United States.

It is on the basis of these facts that the claimant brought a claim in England under the Protection from Harassment Act 1997 on 16 October 2020, two and a half months before the expiry of the Brexit transition period on 31 December 2020. This, coupled with the fact that the defendant was domiciled in Spain, meant that Brussels I bis applied.

The defendant’s first line of defence was sovereign immunity. On 6 December 2022, the Court of Appeal held that the defendant enjoyed immunity from the jurisdiction of the English courts under the State Immunity Act 1978 with respect to the allegations about his pre-abdication, but not post-abdication conduct. This paved the way for the issues that the High Court addressed in its judgment of 6 October 2023.

Submission

Submission is a recognised basis of jurisdiction under Article 26 of Brussels I bis. As a matter of High Court procedure, jurisdictional challenge and submission to jurisdiction are dealt with generally by Civil Procedure Rule 11. CPR 11(4)(a) provides that an application under this rule must be made within 14 days after filing an acknowledgment of service. Otherwise, the defendant is to be treated as having accepted that the court has jurisdiction to try the claim pursuant to CPR 11(5)(b).

The defendant filed an acknowledgment of service on 4 June 2021 and ticked the box ‘I intend to contest jurisdiction’. The claimant argued that the defendant should have disputed the court’s jurisdiction under Brussels I bis within 14 days. Instead, the defendant made a general challenge to the court’s personal jurisdiction in his application notice of 18 June 2021 ‘on grounds that England is not the appropriate forum’ and sought ‘to set aside the service on the Defendant out of the jurisdiction, which was improperly effected’. On 21 February 2023, the defendant abandoned his objection to the service of the claim. A specific challenge to the court’s jurisdiction under Brussels I bis was not made until 22 March 2023. This specific challenge was made pursuant to case management directions that followed the Court of Appeal’s judgment on the immunity issue.

The court held that the defendant did not submit on the basis that his jurisdictional challenge was not abusive, that his general challenge to the court’s personal jurisdiction of 18 June 2021 was sufficient at that stage, and that extension of time and relief from sanctions should be granted to cure any deemed submission that might have arisen by virtue of CPR 11(5)(b) from the lapse of a month between the abandonment of the service challenge and its replacement by the Brussels I bis challenge.

Article 7(2) of Brussels I bis

The heart of the judgment concerns the interpretation and application of Article 7(2) of Brussels I bis to a harassment claim and is found at [51]-[134]. This part of the judgment deals with four key points: the relationship between an autonomous interpretation of Article 7(2) and the domestic law under which the claim is pleaded; the elements of the tort of harassment under English law; whether the event giving rise to the damage occurred in England; and whether the damage occurred in England.

Relationship between Autonomous Interpretation and Domestic Law

It is undisputed that the concept of the ‘place of the harmful event’ in Article 7(2) requires an autonomous interpretation. But the question arose whether the domestic law under which the claim was pleaded had a role to play in this respect. The court provided a positive answer to this question. It quoted with approval [32]-[33] of the Supreme Court judgment in JSC BTA Bank v Ablyazov:

However, the requirement of an autonomous interpretation does not mean that the component elements of the cause of action in domestic law are irrelevant. On the contrary, they have a vital role in defining the legally relevant conduct and thus identifying the acts which fall to be located… In particular, whether an event is harmful is determined by national law.

This led the court to conclude that, for the purposes of determining whether the event giving rise to the damage occurred in England and whether the damage occurred in England, ‘the relevant “event” and “damage” are determined by English tort law, [which] requires consideration of whether the relevant components of an actionable tort, occurring in England, have been made out’ to the standard of a good arguable case ([63]-[64]).

Elements of the Tort of Harassment

This brought the Protection from Harassment Act 1997, which introduced the tort of harassment into English law, to the spotlight. According to the court, the essence of the tort of harassment is that

it as ‘a persistent and deliberate course of unreasonable and oppressive conduct, targeted at another person, which is calculated to and does cause that person alarm, fear or distress’. The conduct ‘must cross the boundary between that which is unattractive, even unreasonable, and conduct which is oppressive and unacceptable. To cross the border from the regrettable to the objectionable, the gravity of the misconduct must be of an order which would sustain criminal liability’. ([69], referring to [40] of the High Court judgment in Hayden v Dickinson)

Importantly:

a course of conduct is something more than a series of events attributed to the same person. A ‘course of conduct’ is more than the additive sum of its parts. A nexus between the activities complained of is required; a court must assess whether the acts complained of are separate or linked together to form a specific and coherent whole. ([72])

Armed with this insight, the court proceeded to determine whether the event giving rise to the damage occurred in England and whether the damage occurred in England.

Event Giving Rise to the Damage

The parties clearly had a deep and multifaceted relationship that went spectacularly sour. It was also clear that the parties’ relationship, including its most unpleasant aspects and their consequences, spanned multiple jurisdictions. Two issues of relevance concerning the interpretation of the ‘event giving rise to the damage’ limb of Article 7(2), however, were not clear.

The first issue concerns the fact that acts of harassment can be done by a defendant directly or by another person on the defendant’s behalf. The question arose whether the acts of another person acting on the defendant’s behalf in England could amount to an act of the defendant in England for the purposes of Article 7(2). To answer this question, the court relied on the Melzer judgment of the Court of Justice:

I do not, and do not need to, take from this any clear principle that the acts of an agent cannot constitute the acts of a principal for the purposes of the ‘cause’ limb of the jurisdictional test where the agent acts in one jurisdiction on the authority of a principal in another. But I was shown no clear authority for the contrary principle either. And I do take from Melzer at least the thoughts that (a) the BRR concerns itself in principle with the issue of a causal act by one person being attributed to another under national law for the purposes of determining jurisdiction, because that tends against the fundamental principles of certainty, predictability and the proximity of a defendant’s conduct to the courts of another country and (b) great care needs to be taken with appeals to intuition as to the ‘right’ outcome in such matters, when the starting point is the fundamental principle of a defendant’s entitlement to be sued in his place of domicile, subject only to limited exceptions of a predictable nature made in the interests of the effective administration of justice. ([104])

The second issue is whether Article 7(2) required an English course of conduct to confer jurisdiction on the English courts, or whether an international course of conduct with acts of harassment in England sufficed. The court held that the former approach was right:

The jurisdictional test cannot be satisfied by doing no more than identifying a collection of English acts featuring in a pleaded international course of conduct and inviting an inference that they themselves add up to an actionable course of conduct in their own right… The right approach works the other way around. It has to start with the pleaded identification of an English course of conduct and then establish that, through pleaded constituent acts of the Defendant in England. Whether any ‘English subset’ of a pleaded international course of conduct amounts to an actionable tort in its own right must itself be pleaded and evidenced. It cannot be assumed as matter of logic to have that quality: harassment is a distinctively cumulative tort, and pleading a whole course of conduct as harassment does not imply pleading that any subset of it must itself constitute harassment (even though it may). ([106])

The court ultimately held that the claimant failed to identify and evidence a tortious course of conduct by the defendant with the necessary coherence, connectivity, persistence, and gravity constituting harassment that occurred in England.

Damage

The question of whether the relevant damage occurred in England raised related issues. Does Article 7(2) require that the claimant became aware of harassing events and experienced alarm, fear, and distress in England, that the proximate and direct damage occurred in England, or perhaps that something else occurred in England?

The court held that:

The impact of any individual constituent episode of that course of conduct is simply not the legally relevant ‘damage’ as defined by English tort law. Any individual episode need have no particular effect at all – it is the cumulative, oppressive effect of the total course of conduct which is of the essence of the tort. ([109])

In other words, the legally relevant damage is ‘just “being harassed”’ ([111]).

The claimant failed to identify and plead any specific experience of harassment in England. Instead, she pleaded an indivisible, ambulatory, and international experience of being harassed, which was not recognisable as distinctively English. Consequently, no relevant damage occurred in England. The court suggested that had the claimant had an English domicile, habitual residence, or physical presence in England throughout, she might have satisfied the requirements of the ‘damage’ limb of Article 7(2) ([118]).

Immunity

As mentioned, the Court of Appeal held on 6 December 2022 that the defendant enjoyed immunity from the jurisdiction of the English courts under the State Immunity Act 1978 with respect to the allegations about his pre-abdication, but not post-abdication conduct. Before the High Court, the claimant had another go at this by seeking permission to amend her pleadings to include pre-abdication matters on two bases: that these matters concerned the defendant’s motives for his post-abdication course of conduct; and these matters were part of the relevant background. The court refused permission because these matters were covered by immunity.

Extraterritoriality

Finally, the court addressed the issue of territorial scope of the Protection from Harassment Act 1997. As is well-known, common law courts apply the presumption against the extraterritorial application of domestic statutes. Since the case contained international elements, the question arose whether it fell outside the territorial scope of the Act.

The court indicated briefly that the Act had territorial limits and that the case fell outside those limits:

It is one thing to say that regard may arguably be had to an extraterritorial ‘act of a defendant’ in an otherwise securely pleaded and evidenced ‘course of conduct’ within the jurisdiction. It may also be right that ultimately…some sort of test of preponderance or ‘significant proportion’ might conceivably evolve to meet the facts of a particular case. But there is no authority at present which comes close to giving any basis for concluding that fully ‘international harassment’ is comprehended within the geographical scope of the Act and I was given no contextual basis for inferring a Parliamentary intention to achieve that as a matter of public policy. ([291])

Comment

This is a complex and rich case and it is impossible to examine it fully within the confines of a blog post that is already too long. I want, nevertheless, to mention three points by way of commentary.

The first point concerns Brexit and the civil law/common law divide in international civil litigation. Civil law jurisdiction rules, epitomised by Brussels I bis, allocate jurisdiction in a rigid way. Jurisdictional bases are limited in number and relatively narrow. Common law jurisdiction rules are flexible, and jurisdictional bases are more numerous and relatively broad. These two approaches to jurisdiction, and how they play out in tort disputes, were recently discussed by the UK Supreme Court in Brownlie 2. Mrs zu Sayn-Wittgenstein-Sayn was in a unique position in that she could choose the jurisdictional system under which to bring her claim. By commencing her proceedings in October 2020, she effectively opted for Brussels I bis. Had she waited a few months and commenced her proceedings after the expiry of the Brexit transition period on 31 December 2020, she could have sued the defendant under the common law rules. It is possible that the claim would have passed the tortious jurisdictional gateway, but the forum conveniens doctrine would have presented a significant challenge. That is probably why the claimant chose to sue the defendant under Brussels I bis.

The second point concerns the court’s interpretation and application of Article 7(2) of Brussels I bis. In Shevill, the Court of Justice confirmed that the domestic law under which the claim is pleaded is of relevance for the application of Article 7(2):

The criteria for assessing whether the event in question is harmful and the evidence required of the existence and extent of the harm alleged by the victim of the defamation are not governed by the Convention but by the substantive law determined by the national conflict of laws rules of the court seised, provided that the effectiveness of the Convention is not thereby impaired. ([41])

The court seised on the opportunity created by Shevill to limit the jurisdiction of English courts over harassment claims. Through section 9 of the Defamation Act 2013, Parliament sought to end London’s position as the global libel litigation capital. The High Court judgment in Corinna zu Sayn-Wittgenstein-Sayn v His Majesty Juan Carlos Alfonso Victor Maria De Borbón Y Borbón can be seen as a related development in the field of harassment.

Finally, the third point concerns the choice-of-law aspect of the case. Even though this was a jurisdictional dispute, the court nevertheless opined on the issue of extraterritoriality. It is interesting, however, that the court approached the issue of application of the Protection from Harassment Act 1997 purely as an issue of statutory construction. There was no mention of the possibility that the choice-of-law rules of the Rome II Regulation (which is retained EU law) might have a role to play in this respect. I think that Rome II, at least if it is applied as directly applicable EU law, requires a different approach. The court should have started its analysis by applying the choice-of-law rules of Rome II. If English law applied, the court could have checked whether the case fell within the territorial scope of the Act. If English law did not apply, the court could have checked whether the Act should nevertheless apply on an overriding basis. A further question could then be asked, namely whether Rome II effects in any way the process of statutory construction.

The parties are in a bitter dispute. The claimant is likely to appeal the High Court judgment. The next chapter in this litigation is keenly awaited.

The eighth meeting of the Special Commission set up in the framework of the Hague Conference on Private International Law to discuss the practical operation of the 1980 Child Abduction Convention and the 1996 Child Protection Convention kicked off on 10 October 2023.

As reported by Mayela Celis on Conflict of Laws, a broad range of issues will be addressed during the meeting, such as delays in return process under the 1980 Convention, the relationship of the 1980 Convention with other international instruments, in particular the 1989 UN Convention on the Rights of the Child, exceptions to the return of the child under the 1980 Convention and protective measures upon return, including with respect to domestic and family violence, child abduction and asylum claims, mediation as relevant to the 1980 and 1996 Conventions, and transfer of jurisdiction under the 1996 Convention, to name just a few (the draft agenda of the meeting can be found here).

The European Association of Private International Law was invited to take part in the meeting as an observer, as it occurred on the occasion of the first meeting of the Special Commission on the practical operation of the 2007 Child Support Convention and on the 2007 Maintenance Obligations Protocol, and the first meeting of the Special Commission on the practical operation of the 2000 Adults Convention.

An EAPIL Working Group was set up for the purposes of contributing to the meeting on the 1980 and 1996 Conventions. The Group, chaired by Costanza Honorati and consisting of Sabine Corneloup, Mónica Herranz Ballesteros, Katarina Trimmings, and Mirela Zupan, prepared a position paper focused on protective measures, which the Scientific Council of the Association endorsed on 10 October 2023.

The conclusions reached by the Working Group are as follows:

I. Protective measures amount to a fundamental tool to achieve compliance with the Convention’s obligation, while guaranteeing physical and psychological safety of the child and thus ensuring respect of the child’s fundamental rights. 

II. The Treaty’s main obligation to return the child is only discharged when such court is convinced that the return is safe and that the return shall not cause any harm, either physical or psychological, to the child. 

III. Ensuring the child’s safe return must be construed as a treaty obligation set on all Contracting States. This requires that all States, i.e. the State of the child’s habitual residence and the State of refuge, shall cooperate one with each other to ensure the physical and psychological safety of the child when implementing the main obligation of returning the child. 

IV. In the context of abduction proceedings the best interests of the child implies that, when pursuing the aim of returning the abducted child to the place of his/her habitual residence, the court in the State of refuge should pay particular attention to safeguarding the overall physical and psychological safety of the child. 

V. A protection measure in the light of the above is only a court order which is capable of being enforced in the State of habitual residence. The requirement of enforceability in the State where protection is sought, i.e. in the State of habitual residence, thus becomes a constitutive element of any measure which aims to effectively protect the child’s on his or her return. 

VI. Even where protective measures are enforceable in the State of habitual residence, caution is needed when determining whether a civil protection order would be appropriate in an individual child abduction case. In the light of concerns over the effectiveness of protective measures, protective measures should not be employed where credible allegations of severe violence have been made and there is a future risk of violence of such severity.

VII. There are several ways which can guarantee the enforceability of a protective measure. It is for the court in the State of refuge, in cooperation with the court in the State of habitual residence, to choose and implement the most appropriate measures.

VIII. Protective measures, if not triggered ex parte, should be considered by the court on its own motion, ex officio. 

IX. A genuine consideration of adopting or requiring protective measures should be strongly encouraged every time the court is satisfied there is a grave risk of harm, and provide an explanation on facts, risks and measures that were considered should be provided. 

A report on the conclusions and recommendations of the eighth meeting of the Special Commission will appear on this blog in due course.

Anabela Susana de Sousa Gonçalves (University of Minho) has posted The material limits of the European Succession Regulation on SSRN.

The abstract reads:

Cross-border successions have their legal framework in the European Union (EU) in Regulation No 650/2012 of 4 July 2012 on jurisdiction, applicable law, recognition and enforcement of decisions and acceptance and enforcement of authentic instruments in matters of succession and on the creation of a European Certificate of Succession (European Succession Regulation). About this Regulation, there are sometimes some expectations, not always realistic, about the answers that it can provide, in an area where there are many divergences between the substantive law of the Member States. It is therefore important to know the limits that circumscribe the material scope of application of the Regulation, bringing to the discussion the jurisprudence of the European Union Court of Justice (ECJ).

On 20 June 2022, the CJEU rendered its judgment in London Steam-Ship Owners’ Mutual Assistance Association Ltd v Spain. The judgment, which dramatically altered the understanding of the arbitration exception under the Brussels instruments, gave rise to heated comments and debates, including an on-line symposium on this blog.

On 6 October 2023, the English High Court rendered a new judgment in the case where Justice Butcher discussed, inter alia, the meaning of the CJEU jugdment and the extent to which he was bound by it.

Interestingly, the insurers had initiated a second arbitration in 2019 which was still in progress when the CJEU delivered its judgment. As a result, the arbitrator, Sir Peter Gross, also had to express views on the meaning of the CJEU judgment in the two partial awards he made on 6 January 2023 and 27 March 2023.

The English proceedings are highly complex, with a number of challenges initiated by each of the parties against the various arbitral awards and application to enforce the Spanish judgment. Without getting into all these details, I focus below on the issues addressed by the CJEU and how they were perceived and addressed by the English court.

Concept of Judgment in Article 34(3) Brussels I

A first argument made by Spain before the English court was that the English judgments on the arbitral awards were no relevant ‘local’ judgments for the purposes of Article 34(3), as they were not judgments of ‘a judicial body of a Contracting State deciding on its own authority on the issues between the parties’. (Solo Kleinmotoren GmbH v Emilio Boch [1994] ECR I-2237).

Justice Butcher ruled that the CJEU confirmed that the argument based on Solo Kleinmotoren was incorrect.

123. In the judgment of the CJEU, at paras. [48-50], the CJEU said that a judgment entered in terms of an arbitral award was capable of being regarded as a ‘judgment’ within the meaning of Article 34(3). In that regard, the CJEU pointed out at para. [49] that the concept of a ‘judgment’ set out in Article 32 was a broad one and ‘covers any judgment given by a court of a Member State, without its being necessary to draw a distinction according to the content of the judgment in question, provided that it has been, or has been capable of being, the subject, in the Member State of origin and under various procedures, of an inquiry in adversarial proceedings’. At para. [50] the CJEU said that this interpretation of the concept of ‘judgment’ in Article 34(3) was supported by the purpose of the provision, which was to protect the integrity of a Member State’s internal legal order. At para. [53] the CJEU said that, ‘a judgment entered into in the terms of an arbitral award is capable of constituting a ‘judgment’ within the meaning of Article 34(3) …’.

A second argument made by Spain before the English Court was that the whole of the English proceedings, and the resulting English s. 66 Judgments (declaring the first arbitral awards enforceable in England), fell within the arbitration exception to the applicability of the Brussels Regulation enshrined in Article 1(2)(d). Spain’s contention was that a non-Regulation judgment, or at least a judgment which is a non-Regulation judgment because it falls within the arbitration exception, did not count as a relevant ‘home’ judgment for the purposes of Article 34(3).

Again, Justice Butcher ruled that the CJEU confirmed that the argument, that he labelled ‘the material scope point’, was incorrect.

142. (…) the Court’s reference, at para. [50], to the purpose of Article 34(3) as being the protection of the integrity of a Member State’s legal order is relevant to this point as it is to the ‘Solo’ point. Further at paras [51-52], the CJEU said that it was ‘apparent from the Court’s case-law that the exclusion of a matter from the scope of Regulation No.44/2001 does not preclude a judgment relating to that matter from coming within the scope of Article 34(3) of that regulation and, accordingly, preventing the recognition of a judgment given in another Member State with which it is irreconcilable’, and made reference to Hoffmann v Krieg. 

Jurisdictional Qualifications of the CJEU

The most novel, far reaching and debatable aspects of the ruling of the CJEU were, however, the introduction of new requirements relating to lis pendens and the privity of jurisdiction clauses.

Readers will recall that the CJEU ruled that where a judicial decision resulting in an outcome equivalent to the outcome of an arbitral award could not have been adopted by a court of the Member State of enforcement without infringing the provisions and the fundamental objectives of the Brussels I regulation, in particular as regards the relative effect of an arbitration clause included in the insurance contract in question and the rules on lis pendens contained in Article 27 of that regulation, the judgment on the arbitral award cannot prevent the recognition of a judgment given by a court in another Member State.

The issue before both the arbitrator and the English court was whether this part of ruling had deprived the arbitrator from its jurisdiction and thus prevented the operation of Art. 34(3), as the relevant arbitral awards should be set aside for lack of jurisdiction.

Both of them rejected the argument on the ground that they were not bound by answers to questions not referred to the CJEU.

209. I have also reached the conclusion (as did Sir Peter Gross at paragraph [122(3)] of the Gross First Award) that, if the CJEU purported to answer a question not or falling outside those referred to it, the national court would not be bound to follow any such purported answer, though it would not lightly so hold. This appears to me to be the corollary of the limited jurisdiction established by Article 267 of the TFEU. (Reference to precedents omitted)

Justice Butcher then concluded:

214. Applying the principles set out above, in my judgment the CJEU, in paragraphs [54] to [73] of its Judgment, gave answers to questions which had not been referred to it, and which this Court had refused to refer. In doing so, it trespassed on the facts of the case.

215. Thus, the first two questions referred to the CJEU in relation to Article 34(3) raised clearly defined issues of EU law. They asked whether a s. 66 judgment was capable of falling within Article 34(3) in light of two specific points, the ‘Solo point’, and the material scope point. The nature of the questions and the reasons why they were asked were set out both in the Reference Judgment, and very clearly in the Reasons for the Reference section of the Order for Reference.

216. There was no question aimed at whether there were other reasons why Article 34(3) might be inapplicable, and specifically no question directed at whether Article 34(3) might be inapplicable because the English s. 66 Judgments had been entered in circumstances where the English Court could not have entertained the claim which was the subject of the Spanish proceedings. That, in my view, raised different questions (including but certainly not limited to different questions of EU law).

Justice Butcher then wondered whether, although he was not bound, he would still want to follow the CJEU. He ruled he would not.

236. Further, while I am clearly entitled to have regard to the reasoning of the CJEU in those paragraphs, if I am not bound by them I would not follow them. In my judgment they fail to give effect to the exclusion of arbitration from the Regulation, and they fail to have regard to the jurisprudence of the ECJ/CJEU which has recognised that the arbitration exception is effective to exclude arbitration in its entirety, including proceedings in national courts the subject matter of which is arbitration, in particular the decisions in Marc Rich & Co AG v Società Italiana Impianti PA (The ‘Atlantic Emperor’) (Case C-190/89), and Proceedings Concerning Gazprom OAO (Case C-536/13).

237. Instead I would follow, and may be bound by, the reasoning of the Court of Appeal in The Prestige (Nos. 3 and 4), in relation to an argument which was raised there with reference to Assens Havn, to the effect that an analogy with that case indicated that the Award Claims there under consideration did not fall within the ‘arbitration exception’ to the Regulation. The argument of the States was that the reasoning in Assens Havn, which was to do with an exclusive jurisdiction clause in a liability insurance policy, was ‘equally applicable to an arbitration clause’. At [79]-[84] the Court of Appeal said this:

(…)

[84] For these reasons we hold that the reasoning in Assens Havn cannot apply to an arbitration clause. We note that this is also the view of Professor Briggs (Civil Jurisdiction and Judgments, 7th ed (2021), para. 9.05). Accordingly the “arbitration” exception applies to the Award Claims and jurisdiction must be determined in accordance with domestic law principles.’

Res Judicata as English Public Policy

The English judgment also addressed the argument of whether res judicata was a principle of English public policy, and whether the Spanish judgment could be denied recognition under the public policy exception in Article 34(1), on the ground that the English judgments declaring enforceable the first arbitral awards were res judicata.

Justice Butcher found that the Spanish judgments would also be contrary to public policy on that ground, but the argument was subsidiary, given that he had already found that the Spanish judgments should be denied recognition on the ground of Article 34(3).

Assessment

The most interesting part of the English judgment is its interpretation and treatment of the most controversial aspects of the CJEU judgment, namely the jurisdictional qualifications.

The debates before the English court show how far reaching the CJEU judgment might be and raise the issue of whether the CJEU has indeed laid down jurisdictional requirements for arbitrators.

On the one hand, a narrow reading of the CJEU judgment could be that nowhere does it expressly say that it has a bearing on the jurisdiction of arbitrators. And that, in the case at hand, it had not ruled on the issue of whether Spain was bound to arbitrate. This, I understand, was the position of the arbitrator. Justice Butcher reported:

77. At [126] Sir Peter Gross considered whether the CJEU Judgment had any bearing on his jurisdiction as an arbitrator. He concluded that, whatever its ambit in other respects, the CJEU Judgment said nothing at all about his jurisdiction; and that he entertained no doubt at all about his having jurisdiction.

78. At [127]-[132] Sir Peter Gross considered whether the CJEU Judgment had decided that Spain had not been obliged to arbitrate its dispute with the Club and hence was not in breach of any equitable obligation by pursuing its Article 117 claims and seeking to enforce the Spanish Judgment. The Arbitrator found that the CJEU Judgment did not contain any such decision. He said (at [130]) that ‘Part 2’ of the CJEU Judgment went to the status of English court judgments, not whether Spain was in breach of its obligation to arbitrate. He said (at [131]) that the CJEU Judgment had said nothing about whether Spain had been obliged to pursue its dispute in arbitration, and that he could see no proper basis for reading in any such decision.

On the other hand, a less cautious reading of the CJEU judgment is that it has indeed laid down jurisdictional requirements for arbitrators. Spain made the argument repeatedly (which is fair enough).

Justice Butcher avoided addressing the issue by ruling that he was not bound by that part of the CJEU judgment. But the views he expressed when he declined to consider the CJEU judgment persuasive enough to follow it may well reveal that he did think that the CJEU has indeed laid down jurisdictional requirements.

Debate to be continued, on the Continent.

European Law Institute (ELI) has recently launched a new project devoted to the proposal of the EU Regulation on the Recognition of Foreign Filiations.

The ELI Project Team wants to scrutinise the rules of the proposal  from four specific perspectives: children’s, LGBTI persons’ and women’s fundamental rights, and the underlying EU primary law, especially concerning the free movement of citizens.

The works within the project will be conducted under the accelerated procedure, with the aim of having results by February 2024. Based on its analysis, the Project Team wants to develop a Position Paper, in which provisions of the proposal will be scrutinized and alternative formulations proposed. Additionally, the Position Paper will be supplemented with explanations and comments. Model Rules in the form of desirable amendments to the proposal will also be drafted.

The ELI Project Team consists of Claire Fenton-Glynn, Cristina Gonzalez Beilfuss, Fabienne Jault-Seseke, Martina Melcher, Sharon Shakargy, Patrick Wautelet, Laima Vaige with Susanne Gössl and Ilaria Pretelli acting as Reporters.

On 2 October 2023 the Kick-Off Webinar of the Project was held. Here is a summary of discussions and a recording of the whole meeting.

Posts on this blog devoted to the same proposal and academia’s reactions to it may be found here, here and here.

The judgment by the CJEU in Club la Costa (decision of 14 September 2023, Case C-821/21), has already been analysed from a jurisdictional perspective in a previous post. In the same decision, the court also addresses an important issue regarding the applicable law under the Rome I Regulation.

Facts

Remember that a British resident had entered for private purposes into a timeshare contract with a British company (Club La Costa) through the latter’s Spanish branch. This contract concerned tourist accommodation in Spain. Subsequently, the British resident had brought a suit in Spain.

The standard terms of the contract stipulated that it shall be governed by English law. However, Spanish law, as the law of the place of the immovable, was more favourable for the British resident than English law. (In particular, Spanish law requires the contract to be entered into the land registry as well as to specify the accommodation and the precise duration of the time-share, see the parallel decision rendered on a similar contract on the same day in Case C-632/21, JF and NS v Diamond Resorts Europe et al.)

Legal Issues

In essence, the Spanish court wanted to know whether it could apply Spanish law to the dispute. For this, it had to overcome the choice of law in the contract as well as the consumer protection provisions, which both pointed to English law. If the choice of law was incompatible with Article 3, and Article 6 Rome I did not apply because it was unfavourable to the consumer, the application of Spanish law might have been justified, e.g. under Article 4(1)(c) Rome I (for a discussion whether this provision governs timeshare contracts, see Case C-632/21, JF and NS v Diamond Resorts Europe et al.).

The Spanish court therefore asked the CJEU (1) whether it would be compatible with Article 3 Rome I to consider a choice-of-law clause in standard terms as valid, (2) whether the business partner could also rely on the consumer protection provision of Article 6 Rome I, and (3) whether it could ignore the law of the consumer’s habitual residence where the law that would normally govern the contract (in the absence of consumer protection) is more favourable to the consumer in the particular case.

The Validity of the Choice of Law in Standard Terms

For the first question, concerning the validity of a choice-of-law clause in a standard contract term, the CJEU could refer to its precedent in VKI v Amazon (Case C-191/15). There, it had held that such a clause is valid only if it does not lead the consumer into error about the continued application of the mandatory rules of the law of its habitual residence.

In the present case, the law of the habitual residence of the consumer was selected in the standard term. Hence, there was no risk of any error of the consumer. The CJEU thus deemed the clause to be valid.

Can Businesses Rely on Consumer Protection and can the Consumer Waive such Protection?

The second and third question were answered together by the CJEU. In this regard, it held that the consumer protection provision of Article 6 Rome I is

not only specific, but also exhaustive, so that the conflict-of-law rules laid down in that article cannot be amended or supplemented by other conflict-of-law rules laid down in that regulation, unless they are expressly referred to in that article” (para 78).

This is an important ruling with potential relevance for many disputes (e.g. it was also applied in the parallel case in Case C-632/21, JF and NS v Diamond Resorts Europe et al.). From a theoretical perspective, this ruling means that the law designated by Article 6 Rome I is an objective conflict-of-laws rule and not merely a unilateral defence by the consumer.

Assessment

This decision has two consequences.

First, the consumer protection provision can also be relied upon by the business party to the contract. This makes a lot of sense. If it were otherwise, the business would have to wait for the consumer to choose her preferred law before it could assess the legal situation.

Second, the ruling means that the consumer cannot waive the protection of Article 6 Rome I. Indeed, this is just the mirror image of the first consequence, because if the consumer could waive the protection, then  it would be impossible for the business to rely on the provision. Therefore, this consequence must be applauded too.

It should be noted, however, that the situation in the law of jurisdiction is different on the latter point. According to the CJEU, the consumer can waive the protection by Article 18(1) Brussels I bis Regulation (see decision in Wurth Automotive, Case C-177/22 and the comment by Marion Ho-Dac). This can be easily explained, though, because already the wording of this provision makes it clear that it benefits exclusively the consumer and that the business cannot rely on this protective head of jurisdiction. It is different with Article 6 Rome I, which determines the law governing consumer contracts objectively, and thus for both parties.

— Thanks to Verena Wodniansky-Wildenfeld, Felix Krysa and Paul Eichmüller for reviewing this post.

The group-of-companies doctrine allows attributing obligations of one group member to another. It may also be used to justify a head of jurisdiction to sue all members of one group at the same place.

Yet this doctrine does not apply under the Brussels I bis Regulation, at least not in the consumer contract context, as the CJEU has held in Club la Costa (judgment of 14 September 2023, Case C-821/21). In the same decision, the Court also clarified the burden of proof regarding the domicile of a corporation. The points of the judgment addressing the applicable law under the Rome I Regulation will be commented in a subsequent post.

Facts

A British resident had entered for private purposes into a timeshare contract through the Spanish branch of a British company (Club La Costa). The contract stipulated the exclusive jurisdiction of the courts of England and Wales.

The consumer then brought a claim in a Spanish court against Club La Costa, which apparently went into liquidation subsequently, and various other British companies belonging to the same group.

Legal Issues

The Spanish court asked the CJEU whether the term ‘other party to the contract’ in Article 18(1) Brussels I bis Regulation could also refer to other group members. It furthermore wanted to know how the group members would have to prove that they are not domiciled in Spain but abroad.

Ruling on the Group-of-Companies Doctrine

The CJEU first underlines that the application of Article 18(1) Brussels I bis Regulation presupposes the existences of a contract, and that it is decisive “that the parties to the dispute are also the parties to the contract in question” (para 48) (on the wider scope of Article 7(1) Brussels I bis in this respect, see CJEU, Joined Cases C-274/16, C-447/16 and C-448/16, flightright v Air Nostrum, paras 62-65). Therefore, a consumer’s action under this head of jurisdiction must be brought against the other party to the contract (para 50). Consequently, it cannot be brought against other members of the group, with whom the consumer had been contractually linked as well, but not by the timeshare contract.

The Court of Justice distinguishes this case from its decision in Maletic (Case C-478/12). In the latter, a consumer couple had booked a vacation trip with an internet platform and a travel agency. The CJEU had ruled at the time that the contractual relationship with the platform operator was ‘inseparably linked’ to that with the travel agency and that both would therefore fall under the consumer heads of jurisdiction of the Brussels I Regulation. This is, however, not the case with the contracts between the consumer and the members of the group in Club La Costa, which can be neatly separated from each other.

Ruling on the Proof of Corporate Domicile

The second question requires a little more explanation. The domicile of corporations is determined by Article 63(1) Brussels I bis in a three-fold manner (statutory seat, central administration and principal place of business), with a special definition of the statutory seat of British companies in Article 63(2). The burden of proof for these places is a procedural question, thus falling outside the scope of the Brussels I bis Regulation.

Yet the reference for a preliminary ruling reported the opinion of some Spanish courts which interpret Article 63(2) Brussels I bis Regulation as merely creating a ‘presumption of fact’. If it were ascertained that a defendant company carries out activities in Spain, the international jurisdiction of the Spanish courts would be justified. Hence, it would be for the defendants to show that their domicile is located outside of Spain (para 31).

The CJEU gives this interpretation short shrift. It underlines that Article 63 Brussels I bis must be subject to autonomous interpretation under EU law (para 60). The provision gives the consumer the right to choose between the three locations set out there (para 63). Hence, it does not limit the consumer’s choice (para 64), but on the contrary expands it. The provision of Article 63(2) Brussels I bis, in turn, provides a clarifying definition of the statutory seat of English companies (para 65). It can therefore not be accepted that these provisions would merely create presumptions that could be rebutted (para 66).

Assessment

On both points, the ruling of the CJEU is clear, straight-forward, and firmly anchored in the text of the Regulation. The binding wording must be upheld against the tendency to disregard it when this suits the consumer in the individual case. As important as the goal of consumer protection is, it does not justify bending the rule of law.

— Thanks to Paul Eichmüller for reviewing this post.

 

Lydia Lundstedt, Senior Lecturer in Private International Law at the Stockholm University and in Intellectual Property Law at the Linköping University, has accepted the invitation of the editors of the blog to present her recent book, titled ‘Cross-Border Trade Secret Disputes in the European Union: Jurisdiction and Applicable Law’, published by Edward Elgar.

In today’s knowledge-based and data-driven economy, information is a company’s most valuable asset. The most common form of legal protection for information are laws that protect trade secrets. In contrast to patents, copyright, and trademarks, whose importance for protecting intangible assets is well-recognised, trade secret protection has often come in their shadow as the less important form of protection. The importance of legal protection for trade secrets is however gaining acceptance and many states have sharpened their laws on trade secret protection. In determining the form and level of trade secret protection, states consider (often constitutional) rules on the freedom of information, the freedom to compete and operate a business, employee mobility, and privacy. Depending on the social, political, and economic environment of the state, the form and level of protection may vary considerably.

To ensure a ‘sufficient and consistent level’ of protection under the laws of all the Member States, the European Union (EU) enacted Directive 2016/943 on the Protection of Undisclosed Know-how and Business Information (Trade Secrets) against their Unlawful Acquisition, Use and Disclosure. The Directive is in the form of a minimum directive, so Member States may provide for more far-reaching protection. Complicating matters is the fact that trade secret protection is a bit of a ‘strange bird’, which is reflected in the diverging doctrinal basis for trade secret protection. This divergence continues even after the implementation of the Trade Secret Directive, where some Member States continue to provide protection under unfair competition law, others have introduced a sui generis form of protection, and one Member State protects trade secrets as an intellectual property (IP) right. In addition, all Member States continue to protect trade secrets under contract law, and under the legal systems of some Member States, a trade secret holder may raise concurrent claims based on contractual and non-contractual grounds.

Trade secret protection is even more diverse on the international level. The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) guarantees only a minimum level of protection for ‘undisclosed information’ and leaves a wide margin of discretion with respect to how Members can afford protection. The inclusion of trade secret protection in a treaty on intellectual property adds to the confusion about the correct classification of trade secrets.

With the ease of digital communications, employee migration, and international trade, trade secret violations can easily have a cross-border, and even a global dimension.  Unlike physical assets, information can move at the speed of light and become ubiquitous instantaneously.  In this respect, trade secrets are like (traditional) IP rights in that trade secrets and IP rights consist of commercially valuable information that are often exploited over national borders in order to take full advantage of their economic potential. In another respect, however, trade secrets differ from IP rights, which pursuant to the territoriality principle, may be in the public domain in some states without affecting their protection in others. This is not the case for trade secret protection because if the information becomes freely accessible, it will no longer fulfil the criterium of secrecy that is required for its continued protection.

Within the EU, one would expect that the environment would be conducive for the litigation of cross-border trade secret disputes because the rules on private international law are harmonised at the EU level. Despite this, cross-border litigation and enforcement of trade secrets is considered to be extremely difficult and is also rare. This may be due to the varying doctrinal bases for trade secret protection and the fact that trade secret violations can take place in contractual and non-contractual contexts. Moreover, if the trader secret holder brings proceedings against a former employee, weaker party rules will affect the choice of forum and applicable law. Another complicating factor is that in some cases, jurisdiction and the applicable law is based on the location of damage, which is difficult to localise as trade secrets are intangible and can be acquired, disclosed, and used everywhere. What is more, there may be a number of potential defendants located in different countries that allegedly violated the trade secrets, and it may be difficult to join them all in one proceeding and under one law.

The book investigates how the EU private international law rules can be interpreted to facilitate the objectives of the EU Trade Secret Directive when trade secrets are litigated and enforced over national borders. A basic assumption for this study is that effective and consistent protection of trade secrets in cross-border situations is facilitated when the parties can resolve their dispute before one court that has jurisdiction over the entire dispute and under one law, resulting in a judgment capable of being enforced in all Member States. When analysing which Member States have jurisdiction and which law or laws are applicable as well as the scope of the jurisdiction and of the applicable law, the book considers the competing interests of the parties and the EU public interest in general.

The book concentrates on three common categories of defendants, namely, contractual partners, employees, and competitors, and describes and analyses where each respective category of defendant can be sued and what law(s) is(are) applicable from an EU private international law perspective. The book also considers whether any of the rules in the Trade Secret Directive might be overriding mandatory rules, public policy (ordre public), or non-excludable rules that displace corresponding rule in the lex causae.

A webinar on early marriages, organised by the Interest Group on Private International Law of SIDI, the Italian Society of international Law, will take place on 5 October 2023 at 4 pm CET.

The event will specifically concern the decision of the German Federal Constitutional Court, of 2023, on the constitutionality of the German law combating child marriages of 2017, and aims to provide comparative reflections on early marriages and their regulation in national and international law.

The main speaker will be Nadjma Yassari (Max Planck Institute for Comparative and International Private Law), while Giacomo Biagioni (University of Cagliari) will act as a discussant.

The webinar, in English, will be broadcast through Microsoft Teams. Those interested in attending are invited to use this link to connect as the webinar begins. No registration is required.