Agrégateur de flux

Benjamin Hayward, Conflict of Laws and Arbitral Discretion – The Closest Connection Test, Oxford University Press, 2017, ISBN 9780198787440, pp. 408, GBP 125

Arbitration is the dispute resolution method of choice in international commerce, but it rests on a complex legal foundation. In many international commercial contracts, the parties will choose the law governing any future disputes. However, where the parties do not choose a governing law, the prevailing approach in arbitration is to afford arbitrators broad and largely unfettered discretion to choose the law considered most appropriate or most applicable. The uncertainty resulting from this discretion potentially affects the parties’ rights and obligations, the performance of their contract, the presentation of their cases, and negotiations undertaken to settle their disputes. In this text, Dr Benjamin Hayward critically reviews the prevailing approach to the conflict of laws in international commercial arbitration. The text adopts a focused and detail-oriented analysis – being based on a study of more than 130 sets of arbitral laws and rules from around the world, and drawing heavily on arbitral case law. Nevertheless, it remains both practical and accessible, taking as its focus the needs and expectations of commercial parties, who are the ultimate users of international commercial arbitration. This text identifies the difficulties that result from resolving conflicts of laws through broad and unconstrained arbitral discretions. It establishes that a bright-line test would be a preferable way to resolve arbitral conflicts of laws. Specifically, it recommends a modified Art. 4 Rome Convention rule as the ideal basis for law reform in this area of arbitral procedure.

by Zoltán Fabók LL.M. (Heidelberg), visiting lecturer at ELTE University, PhD Candidate at Nottingham Trent University

The Hungarian Parliament has recently adopted a new act on private international law (see the previous post by Tamás Szabados). The legislator set ambitious goals: the new law extends, somewhat surprisingly, to the PIL aspects – jurisdiction, applicable law and recognition of foreign proceedings – of the international insolvency law.

Indeed, the previous Hungarian PIL framework was unfit to adequately address the relevant questions of the international insolvency law outside the context of the Insolvency Regulation. In cross-border situations, the existing regime did not function properly and this resulted in legal uncertainty, improper protection of the foreign debtor’s assets located in Hungary and the neglect of the principle of collective proceedings.

Admittedly, the new law appears to make some (limited) progress regarding the provisions on jurisdiction of Hungarian courts and the law applicable for insolvency proceedings. However, concerning recognition of foreign insolvency proceedings opened in non-EU states the legislator has opted for a flawed model: the extension of the effects of the foreign lex concursus to Hungary. Extending the legal effects of insolvency proceedings opened in third states to Hungary without any substantive filter (save for the public policy exception) does not appear to be realistic. The counterbalance introduced by the new law – namely that the recognition would be conditional upon reciprocity – does not really help: it will simply make the system inoperative vis-à-vis most foreign states. In effect, in most cases no foreign insolvency proceedings would be recognised in Hungary. This may cause that the foreign debtor’s assets located in Hungary would be exposed to individual enforcement actions meaning the violation of the principle of the collective proceedings.

My paper argues that the enactment of the UNCITRAL Model Law on Cross-Border Insolvency by Hungary would adequately fill the regulatory gap left open by the new PIL Act. Rather than extending the legal effects of foreign insolvency proceedings to Hungary, the Model Law attaches limited sui generis legal consequences to foreign insolvency proceedings. The Model Law would allow Hungary to keep under control the infiltration of the effects of foreign insolvency proceedings from third states in relation to which it has no full confidence while maintaining the idea of collective insolvency proceedings by protecting the assets of the foreign debtor located in Hungary and preventing individual actions. In other words, the Model Law represents a flexible approach looking for a balance between recognising the universal effects of the insolvency as provided for by the lex concursus on the one hand and the rigid territorial principle disregarding the foreign insolvency proceedings on the other.

One could question whether the PIL Act is the proper legal framework for addressing international insolvency law. Arguably, the rules on international insolvency should fall outside the scope of the PIL Act: international insolvency law is a rather complex field of law consisting of elements of conflict of laws, international procedural law and insolvency-specific norms. It would be reasonable to deal with this area of law in the Insolvency Act or in a separate piece of legislation.

The paper has been accepted by UNCITRAL for publication in the compilation to be issued after the 50th Anniversary Congress. An earlier preprint version, reflecting to the preliminary drafts of the new PIL Act, can be downloaded from http://ssrn.com/abstract=2919047.

Jean-Jacques Urvoas publie, aux Éditions Dalloz, une lettre destinée au futur garde des Sceaux. Il y présente dix chantiers pour les années à venir.

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La Commission européenne annonce, dans un communiqué du 22 mars 2017, avoir décidé d’enregistrer deux initiatives citoyennes européennes (ICE) consacrées aux droits des citoyens à la suite du Brexit tout en s’opposant à une troisième proposition visant à bloquer celui-ci.

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La Cour européenne des droits de l’homme (CEDH), dans son arrêt de chambre du 6 avril 2017, condamne la France parce qu’elle imposait le plus souvent une opération stérilisante obligatoire comme préalable au changement d’identité sexuelle à l’état civil.

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Le décret relatif à la décision d’enquête européenne en matière pénale, publié au Journal officiel du 9 avril 2017, entrera en vigueur le 22 mai 2017.

Ce texte achève la transposition de la directive n° 2014/41 du 3 avril 2014 (sur cette directive, v. AJ pénal 2014.338, obs. T. Cassuto ). Il est pris pour l’application de l’ordonnance no 2016-1636 du 1er décembre 2016 (sur cette ordonnance, v. Dalloz actualité, 16 déc. 2016, obs. N. Devouèze ).

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The French Cour de Cassation promotes in 2017 a series of seven conferences on the application of foreign law, in partnership with the Société de législation comparée.

Two of them have already taken place on 20 February (“The judge’s role in establishing the content of foreign law”, by Jean-Pierre Ancel, former President of the First Civil Chamber of the Cour de cassation) and 20 March (“The application of uniform law and international conventions”, by Jean-Baptiste Racine, University of Nice).

The five remaining conferences will be held at the Grand Chambre of the Court (5 Quai de l’Horloge, Paris) between 6 pm and 8 pm on the following dates:

• April 20, 2017: International cooperation in researching the content of foreign law (Florence Hermite)

• May 29, 2017: Optional application of foreign law in situations of availability of law and the uniform application of rules of conflict of European origin (speaker: Sabine Corneloup, University of Paris II)

• September 25, 2017: Foreign law facing the hierarchy of norms (speaker: Gustavo Cerqueira, University of Reims)

• October 23, 2017: The Cour de cassation’s control in applying foreign law (speaker: Alice Meier-Bourdeau, lawyer)

• November 27, 2017: The exception of equivalence between the French law and the foreign law (speaker: Sara Godechot-Patris, University of Paris-East)

All conferences are held in French.

For more information: see Cour de Cassation.

Click here to see the whole program.

I reported on AMT V Marzillier at the High Court, failed to flag its overturn in the Court of Appeal (it’s the Easter period: I am in a confessionary mood), and now report swiftly on the Supreme Court confirming the Court of Appeal’s view early April ([2017] UKSC 13).

MMGR is a company incorporated under the laws of Germany and carries on business as a firm of lawyers in Germany. AMTF alleges that MMGR induced its former clients to issue proceedings against it in Germany and to advance causes of action under German law.  AMTF’s clients were referred to it by ‘introducing brokers’; AMTF in turn is referred to as a non-advisory, “execution only”, derivatives broker. AMTF charged its clients commission for its service and paid commission to the introducing brokers. About 70 former clients, who were dissatisfied with the financial results of their transactions, commenced legal proceedings in Germany against both the introducing brokers and AMTF seeking damages under the German law of delict. The claim against the introducing brokers was that they had given bad investment advice or had failed to warn of the risks of the investments. The claim against AMTF was based on a liability which was accessory to that of the brokers: it was alleged that AMTF had encouraged the brokers to behave as they did by paying them commission from the transaction accounts which it operated for its clients and that it owed and had breached a duty in delict (tort) to the clients to prevent any transactions being undertaken contrary to their interests. AMTF challenged the jurisdiction of the German court. Many of the former clients have recovered damages from AMTF by way of settlement.

AMTF argues that the actions in Germany were in breach of the exclusive jurisdiction and applicable law clauses in their contracts with AMTF. It commenced proceedings in the High Court in London against MMGR, based on the tort, in English law, of inducing breach of contract. It seeks both damages and injunctive relief to restrain MMGR from inducing clients to bring further claims in Germany asserting causes of action under German law. AMTF argues that the English courts have jurisdiction over its claim under article 5.3 of the Brussels I Regulation (Article 7(2) in the Brussels I Recast), which gives jurisdiction in tort claims to the courts for the place in which the harmful event occurred or may occur. MMGR challenges the jurisdiction of the English courts to entertain this action.

Popplewell J in the High Court sided with AMTF – I reviewed his judgment in 2014. He decided that the relevant harm which gives rise to jurisdiction under article 5.3 occurred in England as AMTF had in each case been deprived of the benefit of the exclusive jurisdiction clause, which, he held, created a positive obligation on a former client to bring proceedings in England.

Clarke LJ concluded upon Appeal that the English courts did not have jurisdiction as the relevant harm had occurred in Germany. At 57 he wrote ‘I do not reach this conclusion with any great enthusiasm since there is much to be said for the determination of what is in essence an ancillary claim in tort for inducement of breach of contract to be made in the court which the contract breaker agreed should have exclusive jurisdiction in respect of that contract, rather than in the courts of the country where the inducement and breach occurred. But the governing law of the relationship between the former clients and AMTF (which did not have to be that of England & Wales) is not a determining factor in the allocation of jurisdiction under the Regulation.‘ It is not entirely clear what the German courts’ view is on the matter – the unsettled claims were still pending at the time of the Supreme Court’s judgment.

Lord Hodge, after noting the CA’s reluctance, agrees with its conclusion and does so by once again, concisely yet completely, reviewing the CJEU’s case-law on Article 5(3) [7(2)]. For an even more condensed version, see Jake Hardy. At 24: ‘The task for the court is to identify where the relevant harm occurred. That is relatively straightforward in most circumstances, where there is no need for any special rule such as those which the CJEU has developed when it has not been possible readily to identify one place where that harm occurred. It is straightforward in this case.‘ : namely Germany. ‘It is clear that AMTF did not get the benefit of having any dispute with the former clients determined under English law by English courts. But the former clients were under no positive obligation to sue AMTF, which could have no objection if it was not sued.’ (at 25).

Of note is Lord Hoge’s important emphasis (at 29) that the benefits of connecting factors, which justify the ground of jurisdiction, are not in and of themselves connecting factors. Idem for his instruction at 30 that ‘the inconvenience, which the separation of the resolution of the contractual claims against the former clients from the pursuit of the claims against MMGR entails, (does not) carry much weight when one considers the aims of the Judgments Regulation‘: ‘the CJEU has recognised that the scheme of the Judgments Regulation creates the difficulty that one jurisdiction may not be able to deal with all the related points in a dispute (at 32).

Finally reference to the CJEU was refused on the grounds that the issue is acte claire (at 43, with preceding reference to CJEU precedent).

Delightful.

Geert.

(Handbook of) European Private International Law, 2nd ed. 2016, Chapter 2, Heading 2.2.11.2, 2.2.11.2.7).

The 59th edition of the Séminaire de Droit Comparé et Européen d’Urbino (Italy) will be held next summer from August 22nd to September 1st.  

The Séminaire is a common venture of Italian and French jurists taking place since 1959. The venue is ideal for developing a dialogue on Comparative,  International (both public and private) and European law with jurists from different world countries, since it largely benefits of the relaxing time of the year and of the serenity of the environment: Urbino gave birth to humanism and to the Vitruvian man.

This year’s seminar’s main topics are robotics and AI international legal problems, State immunity, the future of family law, arbitration and many others. Speaker include Prof. M.E. Ancel, S. Yansky-Ravid, A. Giussani, C. Malberti, P. Morozzo della Rocca, A. Bondi, L. Mari, I. Pretelli as well as practitioners -lawyers, mediators, arbitrators and notaries. The Seminar promotes multilingual competencies: presentations are in French, English or Italian, often followed by summarized translations in the other two languages.

The whole program as well as email addresses for further information is downloadable  here.

Irrecevabilité

Irrecevabilité

Thank you, Ludo Veuchelen, for alerting me to Adam Liptak’s reporting on Jesner v Arab Bank, in which certiorari was granted by the United States Supreme Court early April. The case may finally have us hear SCOTUS’ view on the question which led to certiorari in Kiobel but was subsequently ignored by the Court: whether corporations can be culpable for violation of public international law. ‘May’ is probably the keyword in the previous sentence.

Geert.

(Handbook of) EU Private international law, 2nd ed. 2016, Chapter 8, Heading 8.2.

Belgium’s Lernout & Hauspie case recently entered a further stage in its civil law chapter. The case is part of Belgium’s (and especially Flanders’) collective memory as an illustration of what can go wrong when markets and investors alike are fooled by corporate greed. Is it world-famous, in Belgium: for those outside, Wiki should help.

Of interest to this blog is the recent judgment of the Gent criminal court on the civil chapter of the case: see my colleague proximus Stefaan Voet’s analysis here. Stefaan has helpfully translated the most relevant sections of the judgment, in particular the court’s rejection of the argument that the US opt-out class action settlement were contrary to Belgium’s ordre public. The court, in my view entirely justifiably, holds that Belgium’s Private international law act does not oppose recognition and enforcement. Of note is the extensive comparative reference which the court makes not just to existing Belgian law on class actions (the Belgian legal order can hardly oppose what it tentatively has introduced itself), but also to a European Recommendation on comparative class action law in the EU (a sort of Ius Commune idea).

Recognition and enforcement rarely makes it to substantive review in Belgian case-law. This judgment is one of note.

Geert.

By Tamás Szabados, LL.M. (UCL), PhD (ELTE), Senior Lecturer at the Eötvös Loránd University (Hungary)

On 11 April 2017, the new Hungarian Private International Law Act (Act XXVIII of 2017), adopted earlier by the Hungarian Parliament, was promulgated. The new Act will enter into force on 1 January 2018 and will fully replace the decree-law of 1979 that currently regulates private international law. The adoption of the new Act was justified by the economic and social changes that occurred since then. The drafting process was based on extensive comparative research and the drafters also paid attention to recent developments in EU private international law.

The new Private International Law Act covers the determination of the applicable law, jurisdiction, recognition and enforcement of foreign decisions as well as other aspects of international civil procedure. The new Private International Law Act introduces some changes in comparison to the rules currently in force.

The General Part deals with certain questions not regulated previously: application of the law of states having more than one legal system, overriding mandatory provisions and changes in the circumstances which determine the governing law. As a novelty, the General Part also contains a general escape clause: if, based on the circumstances of the case, it is obvious that the case is substantially more strongly connected with a law other than the law designated by virtue of the Act, the court may exceptionally apply this law. In addition, a general subsidiary choice of law rule provides that, if the new Act does not contain a specific choice of law rule for a legal relationship that is otherwise covered by the Act, the law of the state will apply with which that relationship is most strongly connected.

The Special Part of the Act extends equally to certain issues which were not regulated earlier, such as the (restricted) freedom to choose the applicable law in property matters for spouses and (registered) partners or the determination of the law applicable to illegally exported cultural property.

Jurisdictional rules as well as the provisions on recognition and enforcement of decisions have been restructured and divided into general and special provisions (such as the rules on matters involving an economic interest and matters concerning family law and personal status).

The text of the New Hungarian Private International Law Act is available (in Hungarian language) here.

Pourvoi c/ Cour d'appel de Paris, deuxième chambre de l'instruction, 5 décembre 2016

Tribunal de grande instance de Tour, première chambre, 30 mars 2017

Tribunal correctionnel de Rennes, 28 mars 2017

Pourvoi c/ Cour d'appel de Paris, deuxième chambre de l'instruction, 5 décembre 2016

Tribunal de commerce de Valenciennes, 6 avril 2017