Droit international général

Professor Hannah Buxbaum has recently published an important report (see here), prepared for the International Academy of Comparative Law’s International Congress, on forum selection clauses.  Below is the abstract.

Abstract

A forum selection clause is a form of contractual waiver. By this device, a contract party waives its rights to raise jurisdictional or venue objections if a lawsuit is initiated against it in the chosen court. The use of such a clause in a particular case may therefore raise a set of questions under contract law. Is the waiver valid? Was it procured by fraud, duress, or other unconscionable means? What is its scope? And so on. Unlike most contractual waivers, though, a forum selection clause affects not only the private rights and obligations of the parties, but something of more public concern: the jurisdiction of a court to resolve a dispute. The enforcement of such a clause therefore raises an additional set of questions under procedural law. For instance, if the parties designate a court in a forum that is otherwise unconnected to the dispute, must (or should) that court hear a case initiated there? If one of the parties initiates litigation in a non-designated forum that is connected to the dispute, must (or should) that court decline to hear the case?

This report, prepared for the International Academy of Comparative Law in connection with its XXth International Congress, analyzes the approach to these questions in the United States. The bottom line is straightforward: almost always, in consumer as well as commercial contracts, forum selection clauses will be enforced. Navigating the array of substantive, procedural, and conflicts rules whose interplay yields that result, though, is far less straightforward. That is the task of this report. Following a short background, it surveys current state law on their use, in consumer as well as commercial contracts. The report then discusses the interpretation and enforcement of forum selection clauses in both state and federal courts. It analyzes their effect on jurisdiction as well as on doctrines involving venue, such as removal and forum non conveniens. The report also covers choice of law problems, particularly as they arise in the course of litigation in federal courts.

To celebrate its 30th Private International Law Day, the SICL is holding a conference devoted to the new challenges of what is sometimes described as the “collaborative” or “sharing” economy. It will take place in Lausanne on 28th June 2018.

The concept of economy includes crowdfunding, “Uberisation” and all other intermediary activities using a digital platform. These mass phenomena, witnessed on a global scale, put in question the very notion of the territorial division of state borders. Is the digital space in which these platforms operate a true space, capable of being delineated and regulated at the national level, and which falls into the territorial scope of application of a law? Or is it rather a volatile cloud, globalised, delocalised, incapable of being pinned down on such a territorial basis? Is it still possible for nation states to guarantee their citizens and/or residents legal protection with regard to the intermediaries who employ them or who offer them their services? Or has it not become essential, even urgent, that a supranational law be devised and placed in the same cloudy skies in which the platform operates? Further still: is it possible to require platforms and their operators to be measured against the particular requirements of a state, notably those concerning the protection of workers and consumers? What role can contemporary private international law play in this regard?

All these questions present a challenge to the supposed neutrality sought by private international law and bring to the fore its potential political and protective role. In this respect, the state can use private international law in order to guarantee cross border protection to the weakest actors in the marketplace – notably, workers and consumers – who reside within its territory (and/or its citizens). On the other hand, however, it may be argued that state interference aimed at constraining those who operate in the digital economy may lead to harmful distortions of the global market. In this regard, what guarantees should be afforded to the freedom of the internet and, at the same time, to that of workers, whose decisions to join and work with a digital platform are made of their own free will? These considerations therefore demand that we draw on the traditional principles of party autonomy and decisional harmony. Speakers include Janine Berg, ILO Genève, Andrea Bonomi, Université de Lausanne, Miriam Cherry, University of St. Louis, Valerio De Stefano, KU Leuven, Marie-Cécile Escande Varniol, Université Lumière, Lyon II, Pietro Franzina, Università degli Studi di Ferrara, Ljupcho Grozdanovski, Université de Genève, Florence Guillaume, Université de Neuchâtel, Tobias Lutzi, University of Oxford, Anne Meier, MSS Law, Edmondo Mostacci, Università Bocconi, Etienne Pataut, Université Paris 1, Panthéon-Sorbonne, Ilaria Pretelli, Institut suisse de droit comparé, Teresa Rodríguez de las Heras Ballell, Universidad Carlos III de Madrid, Gian Paolo Romano, Université de Genève, et Gerald Spindler, Georg-August-Universität.

Click here for whole program and further information.

The European Commission has published yesterday two communications, proposing the amendment of the Evidence and Service Regulations (1201/2000 & 1393/2007 respectively).

The texts can be retrieved here  & here.

The key amendments suggested by both proposals have been summarized by Prof. Emmanuel Guinchard here & here.

‘Reading’ Arica Victims v Boliden Mineral (I have a copy of the case, but not yet a link to ECLI or other database; however there’s a good uncommented summary of the judgment here] leaves me frustrated simply for my lack of understanding of Swedish. Luckily Matilda Hellstorm at Lindahl has good review here (including a hyperlink to her earlier posting which alerted me to the case in 2017).

Boliden Mineral exported toxic waste to Chile in the ’80s, prior to either Basel or EU or OECD restraints (or indeed bans) kicking in. A first issue for consideration was determination of lex causae. Rome II does not apply ratione temporis (it only applies to tortious events occurring after its date of entry into force) – residual Swedish private international law applies, which determined lex causae as lex loci damni. The Court found this to include statute of limitation. This would have been 10 years under Swedish law, and a more generous (in Matilda’s report undefined) period under Chilean law. Statute of limitation therefore following lex causae – not lex fori.

Despite this being good for claimants, the case nevertheless failed. The Swedish court found against liability (for the reasons listed in Matilda’s report). (With a small exception seemingly relating to negligence in seeing waste being uncovered). Proof of causality seems to have been the biggest factor in not finding liability.

Leave for appeal has been applied for.

Geert.

(Handbook of) EU Private International Law, 2nd ed. 2016, Chapter 8.

 

 

I promised a post on C-560/16 E.ON v Dědouch sooner than I have been able to deliver – I have reviewed Wathelet AG’s Opinion here. I do not evidently hold the magic key to the optimal interpretation of Article 24(2) Brussels I Recast’s. Yet regular readers of the blog indeed my students will know I  am not much of a fan of Article 24 full stop – let alone its extensive interpretation.

Briefly, the facts. By a resolution of 8 December 2006, the general meeting of the company incorporated under Czech law, Jihočeská plynárenská, established in the Czech Republic, decided on the compulsory transfer of all the participating securities in that company to its principal shareholder E.ON, established in Munich (Germany). A group of minority shareholders contest not the validity of the sale, but purely the price paid. Czech law moreover holds that any finding on the reasonableness of the price paid cannot have an impact on the very validity of the transfer.

Lower Czech courts consecutively entertained and accepted cq rejected jurisdiction on the basis of Article 6(1) [no details are given but presumably with Jihočeská plynárenská as the anchor defendant, 24(2) (but then presumably with , 7(1) [again no details given but presumably a consequence of the purchase of shares by the minority shareholders]. Both Wathelet AG suggests, and the CJEU holds that the action for review of the reasonableness of the consideration that the principal shareholder of a company is required to pay to the minority shareholders of that company in the event of the compulsory transfer of their shares to that principal shareholder, comes within the scope of application of (now) Article 24(2). Both refer extensively to C‑372/07 Hassett and Doherty, among others.

The general line of interpretation is: secure Article 24’s effet utile, but apply restrictively (like all other exceptions to the actor sequitur forum rei rule).  I do not think that the CJEU honours restrictive interpretation in E.ON. Readers best consult the (fairly succinct – ditto for the Opinion) judgment in full. A few observations.

In the majority (not quite all) of the cases of exclusive jurisdictional rules,  Gleichlauf is part of the intention. That generally is a proposition which goes against the very nature of private international law and should not in my view be encouraged. Particularly within the EU there is not much reason not to trust fellow courts with the application of one’s laws – indeed quite regularly these laws may be better applied by others.

Generally at least three of Article 24 Jurisdictional rules (rights in rem; the corporate exception; and IPR) refer at least in part to the issue of publicity (of public records) and their availability in the Member States whose courts haven been given exclusive jurisdiction. That argument in my view is sooo 1968 (which indeed it is). I see little reason to apply it in 2018.

Further, in accordance with the Jenard report, the principal reason for Article 24(2) is to avoid conflicting decisions of EU courts on the existence of the company or the validity of the decisions of its organs. This goal of course may be equally met by the lis alibi pendens rule – Article 24 does not play a unique role here.

Finally the CJEU remarks at 34 ‘In the present case, while it is true that, under Czech law, proceedings such as those at issue in the main proceedings may not lead formally to a decision which has the effect of invalidating a resolution of the general assembly of a company concerning the compulsory transfer of the minority shareholders’ shares in that company to the majority shareholder, the fact nonetheless remains that, in accordance with the requirements of the autonomous interpretation and uniform application of the provisions of Regulation No 44/2001, the scope of Article 22(2) thereof cannot depend on the choices made in national law by Member States or vary depending on them.’ To cross-refer to the aforementioned Jenard Report: if Article 24(2)’s goal is to avoid conflicting decisions on life and death etc. And if that life and death of a national company depends on the applicable national law as the Court acknowledges here and ditto in Daily Mail and Cartesio/Polbud), then of course the lex causae must have an impact on the application of Article 24(2) .

The Court’s finding on 24(2) meant it did not get to the Article 7 analysis – which I did review in my post on the AG’s Opinion.

Geert.

(Handbook of) EU Private international law, 2nd ed. 2016. Heading 2.2.6.5.

 

Edited by Delphine Porcheron, Mélanie Schmitt and Juliette Lelieur

The University of Strasbourg is organizing workshop series on the protection of Human Rights in transnational situations. The research is conducted in criminal law, labour law, and private international law. After the first meeting which took place last January with the presence of Horatia Muir Watt, Dominique Ritleng and Patrick Wachsmann, the second one will be held in Strasbourg on June 5, focusing on civil and environmental liabilities and private international law.

 

Speakers include :

• Bénédicte Girard, University of Strasbourg
• Marie-Pierre Camproux, University of Strasbourg
• Pauline Abadie, University of Paris Sud
• Fabien Marchadier, University of Poitiers
• Patrick Kinsch, University of Luxembourg, Attorney at law Luxembourg
• Louis d’Avout, University of Paris II
• Jean-Sylvestre Bergé, University of Lyon III
• Caroline Kleiner, University of Strasbourg

For more information click here.

Both the English and French versions of the HCCH Draft Convention on the Recognition and Enforcement of Foreign Judgments have been just uploaded onto the Hague Conference website (< www.hcch.net >). See News and Events here.

This text will form the basis of the discussions at the Diplomatic Session meeting in 2019.

David Restrepo Amariles (HEC Paris), Eva Mouial Bassilana (Université Côte d’Azur) and Matteo Winkler (HEC Paris) have posted on SSRN an article titled The Impact of the French Doctrine of Significant Imbalance on International Business Transactions. The paper is forthcoming on the Journal of Business Law.

The abstract reads as follows.

This article examines the concept of “significant imbalance” (SI) under French law and its impact on international business transactions. “Significant imbalance” is a legal standard meant to assess whether a contractual clause is unfair (abusive). Although initially restricted to consumer law, it has been extended to general contract law with the implementation of a reform entered into force on 1 October 2016. Previously, the Commercial Court of Paris in the ruling Ministry of Economy v Expedia, Inc (2015) had qualified SI as an “overriding mandatory provision” (“loi de police”) under Regulation 593/2008 on the applicable law to contractual obligations (Rome I). As a consequence, SI became operative in respect of international contracts despite an express choice of a foreign governing law made by the parties to the transaction. This article argues that, as a result of Expedia and the 2016 reform, French courts can interfere with international business transactions by striking down contractual terms that they deem unfair according to the SI standard. The analysis focuses on two key issues. On the one hand, notwithstanding recent judicial precedents, SI still fails to provide a reliable test for predicting which clauses or contracts are at risk of being deemed unfair. On the other hand, the legal arsenal supporting the French legislator’s disapproval of SI allocates great power to French courts and the French Government to pursue tort lawsuits against foreign companies allegedly oppressing their commercial partners with SI clauses. Empirical evidence shows that these actions are highly successful compared with those commenced by private actors. The article concludes that all these aspects, together with SI’s turbulent case law throughout the years, will give rise to uncertainty in international business transactions and may eventually disadvantage France in the global competition in such a field.

The programme of the 2018 edition of the International Seminar on Private International Law organized by Prof. Fernández Rozas and Prof. De Miguel Asensio, has been released and is available here. In this occasion, the Seminar is jointly organized with Prof. Moura Vicente and is to be held at the Law Faculty of the University of Lisbonne on 13-14 September 2018. The Seminar, which is closely connected to the legal journal Anuario Español de Derecho internacional privado, will be structured in five sections: Family and Successions; International Commercial Arbitration: International Business Law; Private International Law and IT Law; and Codification of PIL with a special focus on Latin America. The Conference will bring together around fifty speakers from more than twelve countries. Additional information about the seminar is available here.

Thanks to Héloïse Meur, Lilia Aït Ahmed and Estelle Gallant for this post.

On June 21, 2018 a full-day colloquium will take place in Paris on the protection of unaccompanied minors at the former Courthouse.

The colloquium will see the participation of high-hand speakers from institutions facing the issue of unaccompanied minors :

• French public authorities (French authority to protect human rights and civil liberties, French national consultative committee on human rights), • French Supreme Court, • The Paris Bar, • Major civil associations (GISTI, ECPAT, La Cabane juridique), • French and Belgian professors and Phd candidates in law and geography.

The speakers will discuss the root causes of the migration flows of unaccompanied minors, the limits of their treatment by French authorities, the difficulties to coordinate with other EU member States, and envisage the possible room for improvements, notably vis-à-vis what is done abroad, and especially in Belgium.

The program is available here. For registration send an email to colloquemna@gmail.com.

 

Even Advocate-General Bobek has not managed to turn jurisdictional issues re prospectus liability into the prosaic type of analysis which many of us have become fond of. His Opinion in C-307/17 Löber v Barclays is a lucid, systematic and pedagogic review of the CJEU’s case-law on (now) Article 7(2)’s jurisdiction for tort in the context of ‘prospectus liability’ aka investment misrepresentation. Starting with the direct /indirect damage distinction; and focusing of course on the determination of pure economic loss.

Ms Helga Löber invested in certificates in the form of bearer bonds issued by Barclays Bank Plc. In order to acquire those certificates, the corresponding amounts were transferred from her current (personal) bank account located in Vienna, Austria to two securities accounts in Graz and Salzburg. Payment was then made from those securities accounts for the certificates at issue.

Note immediately that the jurisdictional discussion is a result of Article 7(2) not just identifying a Member State: it identifies specific courts within that Member State. Here: claimant brought her claim before a court in Vienna, the place of her domicile. This is also where her current bank account is located, from which she made the first transfer in order to make the investment. The first- and second-instance courts in Vienna however decided that they did not have jurisdiction to hear the case. The case is now pending before the Oberster Gerichtshof (Supreme Court, Austria). That court is asking, in essence, which of the bank accounts used, if any, is relevant to determine which court has jurisdiction to hear the claim at issue.

Close reference is made to Kolassa. In my posting on that case at the time, I noted that the many factual references which the Court built in in its decision, gave it dubious precedent value. Bobek AG in Löber necessarily therefore distinguishes many factual situations. The almost sole focus lies on 7(2): unlike in Kolassa, contracts neither consumer contracts are an issue.

Here are a few things of note:

First, in his review of the existing case-law the AG at 38 points out like I did at the time of the judgment, that the CJEU’s finding in CDC that locus damni for a pure economic loss, in the case of a corporation, is the place of its registered office, is at odds with precedent (he made the same remark in flyLAL).

Next, on locus delicti commissi, the AG suggests that despite Article 7(2)’s instruction, a single ldc within the Member State cannot be determined. The relevant point in his view is the moment from which the prospectus can, by operation of law, start influencing the investment behaviour of the relevant group of investors. In the present case, and considering the national segmentation of the capital market regulation at issue, that relevant group is made up of investors on secondary markets in Austria. At 65:  once it became possible to offer the certificates on the Austrian secondary market, that possibility was immediately available for the whole territory of Austria. ‘The nature of the tort of misrepresentation at issue does not allow for the identification of a location within the national territory because once the author of the tort is allowed to influence the given national territory, that influence immediately covers the whole territory, irrespective of the actual means used for the publication of a specific prospectus.’ As we know from CDC, the Court does not readily accept that a single ldc cannot be determined.

Further, for locus damni, the AG suggests (at 78) ‘The place where…a legally binding investment obligation is factually assumed… The exact location of such a place is a matter for the national law considered in the light of available factual evidence. It is likely to be the premises of a branch of the bank where the respective investment contract was signed, which may correspond, as in the Kolassa case, to the place where the bank account is held.‘ That in my view first of all is not a warranted outcome. The investor in Löber is not a consumer within the protected categories of the Regulation. Suggesting the place of conclusion of the obligation leaves room for the claimant to manipulate the forum of any future suit in tort. This is exactly what the Court objected to in Universal Music. Moreover, note the reference to ‘the national law’. It is quite unusual to suggest such a role for lex fori in light of the principle of autonomous interpretation. Unless the AG in fact means the ‘lex contractus’, presumably to be determined applying Rome I.

In summary there are quite a few open questions here – not something of course which I would necessarily object to.

Geert.

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

 

In Chevron Corp v Yaiguaje, the Canadian Supreme Court as I reported at the time confirmed the country’s flexible approach to the jurisdictional stage of recognition and enforcement actions. Following that ruling both parties files for summary judgment, evidently advocating a different outcome.

The Ontario Court of Appeal have now held in 2018 ONCA 472 Yaiguaje v. Chevron Corporation that there are stringent requirements for piercing the corporate veil (i.e. by execution on Chevron Canada’s shares and assets to satisfy the Ecuadorian judgment) and that these are not met in casu.

Of particular note is Hourigan JA’s argument at 61 that ‘the appellants’ proposed interpretation of the [Canadian Corporation’s] Act would also have a significant policy impact on how corporations carry on business in Canada. Corporations have stakeholders. Creditors, shareholders, and employees, among others, rely on the corporate separateness doctrine that is long-established in our jurisprudence and that is a deliberate policy choice made in the [Act]. Those stakeholders have a reasonable expectation that when they do business with a Canadian corporation, they need only consider the liabilities of that corporation and not the liabilities of some related corporation.’

Blake, Cassels and Graydon have further review here. Note that the issue is one of a specific technical nature: it only relates to veil piercing once the recognition and enforcement of a foreign ruling is sought.

Geert.

(Handbook of) EU Private International Law, 2nd ed. 2016, Chapter 8.

 

 

 

Today the fourth meeting of the Special Commission on the Recognition and Enforcement of Foreign Judgments concluded in The Hague. Further information (incl. a revised Draft Convention text) will be uploaded on the Hague Conference website soon (< www.hcch.net >). Please check this website for the latest updates.

A background document related to the Treatment of Intellectual Property-Related Judgments under the November 2017 draft Convention was published this month by the Hague Conference (HCCH). It was drafted by the co-Rapporteurs of the draft Convention (Professors Francisco J. Garcimartín Alférez, Universidad Autónoma de Madrid, Spain and Geneviève Saumier, McGill University, Canada) and the Permanent Bureau. This document will be discussed at the Diplomatic Session (a high-level negotiation meeting with a view to adopting a final text – envisaged to take place in mid-2019) and was not meant to be discussed at this Special Commission.

For those of you who are interested in the interaction between intellectual property rights and the Judgments Project, please refer to the above-mentioned background document (instead of the Revised Preliminary Explanatory Report as this will be further revised to reflect the content of this document).

In Platinum Partners, Chapman J held that foreign discovery laws should be considered
for comity concerns, yet they are not determinative of whether discovery should be
permitted under United States law.

Foreign Representatives sought access to documents from US audit firms concerning investment funds that were debtors in Cayman Islands liquidation proceedings recognized under Chapter 15 as foreign main proceedings. Jacob Frumkin has excellent insight and I am happy to refer.

Section 1521(a) of the Bankruptcy Code provides that, upon recognition of a foreign main proceeding, a bankruptcy court may, “at the request of a foreign representative, grant any appropriate relief” … “where necessary to effectuate the purpose of [chapter 15] and to protect the assets of the debtor or the interests of the creditors.”  The first main argument of the auditors was that Cayman law does not permit the discovery of audit work papers or materials that are not a debtor’s property and, if the Court were to grant the motion, its interests and the interests of comity would not be protected.

The Court dismissed this argument, noting that

“it is well-established that comity does not require that the relief available in the United States be identical to the relief sought in the foreign bankruptcy proceeding; it is sufficient if the result is comparable and that the foreign laws are not repugnant to our laws and policies.” and that

“requiring this Court to ensure compliance with foreign law prior to granting relief sought pursuant to chapter 15 would require the Court to engage in a full-blown analysis of foreign law each and every time a foreign representative seeks additional relief in the United States, which may result in differing interpretations of U.S. law depending on where the foreign main proceeding was pending.”

Comity considerations surface in the most technical of corners.

Geert.

 

The School of Law of the University of Bologna is organizing the III Edition of the Summer School on European and Comparative Environmental Law, to be held in Ravenna, July 9-13, 2018.

For more information click here.

You can also get directly in touch with Prof. Lupoi [micheleangelo.lupoi@unibo.it].

 

In 4A_417/2017 (litigants’ names per usual unnecessarily anonimysed; Ganzoni reveal it to be Swatch AG) the Swiss Federal Supreme Court (at 2) first of all correctly reminds us that neither the Lugano Convention nor Brussels I (or indeed the Recast) capture the procedural interest required for a party to request a negative declaration (of liability; in tort, contract or otherwise). In C-113/11 Folien Fischer the CJEU held that negative declarations are covered by Article 7(2); the national court can, indeed must examine its jurisdiction under that provision (and the corresponding one in Lugano) but that does not say anything about standing requirements vis-a-vis interest. (As far as I am aware there is no similar judgment viz 7(1) but the rule must be the same).

Such negative declarations are often part of the race to court; via the lis alibi pendens rules they undercut the forum which the counterparty might have preferred.

As Walderwyss summarise, Hitherto the Swiss Supreme Court had a rather strict approach to the interest required for a negative declaration. Race to court (or ‘forum running’ as the SC calls it) alone was not a sufficient reason. With the March 2018 judgment, that has now been relaxed: Swatch Group AG’s interest in securing a Swiss forum  in a dispute against an English counterparty, was considered sufficient to grant it interest: at 5.4: ‘Zusammenfassend ist festzustellen, dass jedenfalls im internationalen Verhältnis das Interesse einer Partei, bei einem bevorstehenden Gerichtsverfahren einen ihr genehmen Gerichtsstand zu sichern, als genügendes Feststellungsinteresse zu qualifizieren ist.‘

With race to court following Swatch no longer hindered by a restrictive approach to standing, the Swiss surely must have an advantage in this time-sensitive part of international litigation. (Not a great pun, I realise. But I am nearing the end of yet another long working week).

Geert.

(Handbook of) EU Private International Law, 2nd ed. 2016, Chapter 2, Heading 2.2.11.2.6.

Thanks to Horatia Muir Watt and Hélène van Lith (Sciences Po) for this post

Moving from Paris to The Hague for the PAX MOOT Finals – Moot Court Conflict of Laws/Droit International Privé – 6th Edition
Sciences Po – Law School / école de droit

The PAX Moot Eliminatory Round took place last Tuesday in Paris with 8 universities mooting the cross border climate change moot case which addressed a number of complex transnational legal questions in Private International Law and was generously hosted by the ICC (see also our previous post).
The four winning teams who made it to the finals are Erasmus University Rotterdam, University of Heidelberg, Paris I Sorbonne and Sciences Po.
The Panel of the PAX Moot Court Judges consisted of the following members:

Hans van Loon – Former Secretary General of the HCCH (The Hague)
Agnès Maitrepierre – Cour de cassation (Paris)
Daan Lunsingh Scheurleer –Nauta Dutilh (Amsterdam)/ Christine Lecuyer- Thieffry (Paris)
Clément Dupoirier – Herbert Smith Freehills (Paris)
Patrick Thieffry – Environmental Lawyer and Associate Professor. (Paris)
Alexis Foucard – Clifford Chance (Paris)
Michal Chajdukowski and Vasili Rotaru (PAX moot winning team 2017)
The PAX Moot Finals will be held on 1 June at the Peace Palace – hence the name – in The Hague, paying tribute to the city as the “legal capital of the world” and home of The Hague Conference of Private International Law, which also marks its 125th anniversary.

The winning Mooters and best pleaders will be rewarded with an internship at international commercial litigation departments of renowned law firms Nauta Dutilh in Amsterdam and Herbert Smith in Paris.
The concept and goal of the PAX Moot is to study and apply private international law for the resolution of cross border disputes through a concrete problem “the Case” and to train law students and practitioners of tomorrow in arguing and analysing complex global legal questions in international litigation.

The inter-university PAX Moot organized by Sciences Po Law School is a pleading competition addressing issues of Private International Law and this year’s 6th edition has gone global to include teams from universities in Europe and beyond. The organizers thank the following institutions for their support and willingness to open the competition to their students: Sorbonne University Paris I, London School of Economics, HEC, Heidelberg University, Luxembourg University, Cambridge University, University College London (UCL), King’s College London, University of Antwerp, Erasmus University, Université Libre de Bruxelles (ULB), Sciences Po Law School and Statale University of Milan. Participation was also open to US exchange students from Harvard, Columbia, Duke, Northwestern, Northeastern, Duke and Penn law schools.

Inquiries can be addressed to Dr. Hélène van Lith by email at helene.vanlith@sciencespo.fr

In [2018] EWHC 1230 (Comm) St Vincent v Bruce Roberston et al Males J set aside a worldwide freezing order in summary judgment but that is not the trigger for this blog post. Rather, consider paras 33 and 34:

1. St Vincent (and two associated companies) attempted to stop the sale [of a chunk of assets by commencing proceedings in Cyprus against 19 defendants, including Mr Robinson, Winterbourne Pte and the other defendants to these proceedings and also HHL and HDP. On 5 August 2013 the District Court of Nicosia granted an injunction, purporting to restrain any dealings with HDP’s assets. [GAVC: for the jurisdiction of the Cypriot courts: see 12: The Shares Pledge was governed by the law of Cyprus and provided for the exclusive jurisdiction of the courts of that country]
2. Notwithstanding the Cyprus order, on 30 September 2013 the creditors of HDP approved the sale to KFTP. The arrangement was then approved by the District Court of Gliwice on 24 October 2013. The Polish court did not regard the order of the Cyprus court as an impediment to the sale, taking the view that it had exclusive jurisdiction over a Polish company under its supervision and was not required to recognise the Cypriot order in accordance with the provisions of the Brussels Regulation. The court did not rule on any issue whether the proposed sale to KFTP was at market value and was not asked to do so.

I have tried to locate the Polish judgment but have failed to do so (which is where assistance from Polish readers would be appreciated). Presumably however the Polish courts argued that Article 24(2) Brussels I Recast was engaged, and then either per Weber ignored lis alibi pendens (were it to have found the case was still pending in Cyprus), or applied Article 45(1) e ii to ignore the Cypriot findings. In either case, the relevant point is how widely the Polish courts seem to have interpreted Article 24(2).

Come to think of it this would have been good exam material and I have one or two of those coming up (although there is plenty in the ‘exam material’ ledger).

Geert.

(Handbook of) EU Private International Law, 2nd ed. 2016, Chapter 2, Heading 2.2.6.5, Heading 2.2.16.

 

The 2017 Hague Lecture of Professor Burkhard Hess has been published in Recueil des Cours, vol. 388, pg. 49-266.

The Lecture addresses dispute resolution in international cases from the classical perspective of the private-public divide. This distinction is known in almost all legal systems of the world, and it operates in both domestic and in international settings. The main focus of the Lecture relates to overlapping remedies available under private international and public international law; it maps out the growing landscape of modern dispute resolution, where a multitude of courts and arbitral tribunals operating at different levels (domestic, international and transnational) is accessible to litigants in cross-border settings. Today, a comprehensive study of these developments is still missing. This Lecture does not aim to provide the whole picture, but focusses instead on some basic structures, revealing three main areas where the distinction between private and public disputes remains applicable today:

First, the divide delimitates the jurisdiction of domestic courts in cases against foreign states and international organisations (immunities); it equally limits the possibilities of foreign and international public entities to enforce public law claims in cross-border settings. As a matter of principle, public law claims cannot be brought before civil domestic courts of other states. However, this rule has been challenged by recent developments, especially by the private enforcement of (public) claims and by the cross-border cooperation of public authorities. Moreover, the protection of human rights and the implementation of the rule of law in cross-border constellations entail a growing need for a judicial control of acta iure imperii – even if only by the courts of the defendant state.

The second area of application of the divide relates to the delineation between domestic and international remedies. In this field, the distinction has lost much of its previous significance because nowadays individual commercial actors may bring their claims directly (often assisted by experienced actors like litigation funders) before international arbitral tribunals, claims commissions and human rights courts. In this area of law, individuals’ access to international dispute resolution mechanisms has been considerably reinforced. Here, Prof. Hess argues that it would be misleading to qualify parts of the current dispute resolution system as purely “commercial” and other parts as purely “public or administrative”. There are revolving doors between the systems and the same procedures are often applied; what really matters is the proper delineation of  different remedies which functionally protect the same interests and rights.

The third area relates to the privatization of dispute settlement, especially in the context of private ordering. At present, powerful stakeholders often regulate their activities vis à vis third parties (including public actors) by globalized standard terms. Pertinent examples in this respect are financial law (i.e. ISDA), the organization of the internet (i.e. ICANN) and sports law (i.e. CAS). In this context, there is a considerable danger that the privatization of law-making and of the corresponding dispute settlement schemes does not sufficiently respect general interests and the rights of third parties. A residual judicial control by independent (state) courts is therefore needed. Data protection in cyberspace is an interesting example where the European Union and other state actors are regaining control in order to protect the interests of affected individuals.

Finally, the Lecture argues that the private-public divide still exists today and – contrary to some scholarly opinions – cannot be given up. At the same time, one must be aware that private and public international law have complementary functions in order to address adequately the multitude of disputes at both the cross-border and the international level. In this context the private-public divide should be understood as an appropriate tool to explain the complementarity of private and public international law in the modern multilevel legal structure of a globalized world.

A pocket book of the Hague Lecture will be available in the coming months.

In [2018] EWHC 1041 (Ch) MX1 and SES v Fardad Farahzad (defendant’s appeal for summary judgment) claimants are domiciled in Israel and Luxembourg respectively. Their action results from some 57 tweets published by a Twitter account going under the title “@MX1 Leaker”. The Tweets make various allegations of bribery and corruption against the First Claimant. Claimants suggest a conspiracy between the defendant and former employees (for the Tweet seemed furnished with internal information which the defendant would not have had access to).

Defendant’s domicile is not specified but for the purposes of the litigation is not relevant: for jurisdiction is seemingly undisputed and even if this were not based on the Brussels I Recast, the English courts have to apply Rome II to determine applicable law.

Defendant’s request for summary dismissal is based inter alia on the argument that if and to the extent the Claimants or either of them have suffered loss or damage as a result of the Conspiracy, the place of that loss or damage was not England. The applicable law identified by the Rome II Regulation – according to the Defendant: Israeli law – did not recognize the ‘lawful means conspiracy’ pleaded by the Claimants as a cause of action.

Arguments centred around Article 4(1) Rome II: neither 4(2) or (3) were engaged by counsel. Damage pleaded by the Claimants is as follows: (paras refer to the Particulars of Claim)

“23. Unless restrained by the court, the Defendant will cause damage to the business of the Claimants in England and Wales and elsewhere by publishing or facilitating the publication of harmful tweets pursuant to the Conspiracy.

24. Further, unless the Defendant is ordered by the court to delete the Tweets, the Claimants will suffer damage to its business in the future by reason of the continued public existence of the Tweets.

25. By reason of the matters aforesaid, the Claimants have suffered loss and damage. The best particulars which the Claimants can currently give are that: (a) The Claimants have incurred the costs of investigating the Conspiracy in approximately the sum of US$350,000 including costs of at least £100,000 incurred in England in respect of the services of Kroll and of the Claimants’ lawyers which are not recoverable as part of the costs of this claim; (b) The Claimants have also incurred additional costs investigating the allegations made in the Tweets.”

It is the £100K which Smith J at 39 ff applies Article 4(1) to, and he does so with harmonious interpretation (‘resonance’) between Brussels I Recast’s Article 7(2) and Rome II in mind.

Smith J held that the costs of investigating the conspiracy were incurred when the claimants entered into the agreements with investigators and lawyers to have the conspiracy investigated, and therefore in England. It is irrelevant that those costs were not the claimants’ predominant loss (paras 40, 46). The case will undoubtedly lead to Mozaik (‘fragmentation’), but that too is resonant with Brussels I Recast (Shevill).

A good starter introduction to Rome II.

Geert.

(Handbook of) EU Private International Law, 2nd ed. 2016, Chapter 4, Heading 4.4.