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A most useful new research handbook in European Law is on the table – highly recommended! The publisher’s blurb reads:

„The Brussels Ibis Regulation is the magna carta for jurisdiction and the free circulation of judgments in civil and commercial matters in the EU, and forms a cornerstone of the internal market. This timely Research Handbook addresses the cutting edges of the regime, in particular its place within the overall system of EU law and its adaptations in response to specific kinds of lawsuits or the needs of particular industries.

Featuring original research by leading academics from across Europe, chapters take a systematic approach to examining a broad variety of topics in relation to the Brussels Ibis Regulation. Such topics include collective redress, injunctive relief, lis pendens and third states, negotiorum gestio, arbitration, intellectual property lawsuits, and its interface with the European Insolvency Regulation (Recast). Moving beyond what is offered by textbooks and commentaries, this incisive Research Handbook analyses the most recent developments in legislation and practice, as well as providing an outlook on the future of this field of EU law.

This Research Handbook will prove a critical read for scholars and students of EU law. Judges and practitioners working in this area will also find its insights to be of significant practical relevance.

Contributors: T.M.C. Arons, S. Bollée, T.W. Dornis, P. Franzina, T. Garber, C. Heinze, A. Leandro, L.D. Loacker, P. Mankowski, F. Marougiu Buonaiuti, J. Meeusen, D. Moura Vicente, G. Payan, A. van Hoek, C. Warmuth, M.M. Winkler; Edward Elgar: Cheltenham/Northampton, MA 2020 ISBN 978-1-78811-079-22020  392 pp  Hardback  978 1 78811 078 5  £165.00 / $255.00“.

The latest Volume of the Japanese Yearbook of International Law (Vol. 62, 2019) has been released. The Volume dedicates one section to the introduction of the new legislation on international jurisdiction of Japanese courts in family matters. (For an introduction of the new rules relating to international jurisdiction in matter of divorce, see Yasuhiro Okuda, “New Rules of International Jurisdiction over Divorce in Japanese Courts”, Yearbook of Private International Law, Vol. 20 (2018/2019), pp. 61-72).

The Volume also contains an English translation of the new rules as well as English translation of some court decisions relating to public and private international law.

Relevant content include the following:

NEW LEGISLATION ON THE INTERNATIONAL JURISDICTION OF JAPANESE COURTS ON PERSONAL STATUS LITIGATIONSAND DOMESTIC RELATIONS CASES

Aki Kitazawa, Introductory Note, p. 118

Yuko Nishitani, New International Civil Procedure Law of Japan in Status and Family Matters, p. 119

Yuko Nishitani, International Adjudicatory Jurisdiction in Matrimonial Matters in Japan, p. 151

Masako Murakami, International Jurisdiction of Child-Related Cases in Japan, p. 189

Takami Hayashi, International Jurisdiction in Case Related to Succession: New Rules in Japan, p. 209

Manabu Iwamoto, Recognition and Enforcement of Foreign Decisions on Personal Status Litigation and Family Relations Cases, p. 226

JUDICIAL DECISIONS IN JAPAN

Public International Law

Tokyo High Court, Judgment, December 14, 2017, p. 426

Compensation for War Injuries – Individuals’ Right to Seek Compensation under Additional Protocol I to the Geneva Conventions in 1977 – Individuals’ Right to Seek Compensation under Customary International Law

Nagoya High Court, Judgment, April 11, 2018, p. 433

Immigration Control and Refugee Recognition Act – Enforced Deportation – Circumstances to Be Taken into Account – De Facto Marriage with a Nikkei Nisei (Second Generation of Japanese Emigrant)

Tokyo District Court, Judgment, February 28, 2018, p. 440

Dispute over an Employment Contract – Immunity from the Civil jurisdiction of Diplomatic Agent – Article 31(1)(c) of the Vienna Convention on Diplomatic Relations

 Tokyo District Court, Judgment, March 20, 2018, p. 443

Application for Reconsideration of Refugee Status by Persons Who Have Already Left japan – Definition of Refugees – Burden of Proof- Situation in Syria

 Tokyo District Court, Judgment, July 5, 2018, p. 447

Tbe Cessation Clause – Article 1-C(5) of the Refugee Convention – Burden of Proof- Situation in Sri Lanka

Private International Law

Supreme Court (1st Petty Bench), Judgment, March 15, 2018, p. 452

International Child Abduction – Habeas Corpus Relief

Tokyo High Court, Judgment, June 29, 2017, p. 455

Jurisdiction over the Claim Based on Non-performance of Carriage Contract – Piercing the Corporate Veil

Tokyo High Court, Decision, June 30, 2017, p. 458

Order of Seizure – Applicable Law of Statutory Lien 

Tokyo High Court, Decision, August 1, 2018, p. 462

Setting aside of Arbitral Award – Procedural Public Policy

Tokyo District Court, Decision, June 12, 2018, p. 468

Applicable Law of the Claim Arising from a Tort of Defamation – Disclosure of Identification Information of the Sender- Word of Mouth on the Website

 DOCUMENT

National Legislation Act for the Partial Revision of the Personal Status Litigation Act, Etc. (Act No. 20 of April 25, 2018), p. 486

More information on the Yearbook (former Annual) and the content of its past volumes is available at http://www.ilajapan.org/jyil/.

María Asunción Cebrián Salvat and Isabel Lorente Martínez (both from the University of Murcia) have edited a collection of essays in Spanish titled Protección de menores y Derecho internacional privado (Child Protection and Private International Law), published by Comares.

The abstract, kindly provided by the editors, reads as follows.

More and more frequently, families live a highly international life. Children move with their parents, travel and live in different States. Consequently, there has been an exponential growth of international legal disputes in which minors are involved. Legal operators shall be prepared to provide legal solutions to the private international law challenges of these cases and thus, to satisfy the best interest of the child in the specific case. This work brings together a collection of essays dealing with the hot spot areas of private international law in which minors play the major role. Some of these studies address the latest developments of institutions like the protection of unaccompanied minors, adoption, child abduction, rights of custody and rights of access, kafala, surrogacy, online contracts, sports, child workers, fatherhood recognition, family reagrupation… Others deal with the principles underlying the protection of minors in private international law (the “habitual residence of the child” connection, the need of urgent procedures, State cooperation…). Topics are addressed from an European and Spanish Private International Law perspective and written by a renowned team of private international law scholars and practitioners.

For more information, see here.

Dr Jan De Bruyne presented a paper at the Research Seminar Series at the School of Law, the University of Queensland, Australia discussing ‘Regulating Artificial Intelligence in the European Union: Legal and Ethical Aspects’ on 17 April 2020.

Artificial intelligence (AI) has become an area of strategic importance and a key driver of economic development. It has many benefits and can bring solutions to several societal challenges. At the same time, however, legal and ethical challenges remain and have to be carefully addressed. It is, therefore, not surprising that the regulation of AI is probably one of the most debated legal topics in the European Union (EU) and several of its Member States. This debate has only been strengthened with the recent European Commission’s White Paper on Artificial Intelligence – A European approach to excellence and trust.

Some argue that the law will need a fundamental make-over to deal with the reality of AI. The question that arises from a legal point of view is thus whether the existing longstanding legal principles are compatible with these technological evolutions or, instead, new legislation will need to be adopted. After a more general overview of the existing legal and ethical framework on AI in the European Union, I will proceed with an analysis of the situation for damage caused by AI systems such as autonomous vehicles to find an answer to that question. The analysis uncovers some difficulties in the application of traditional tort law principles. Reliance on a fault-based liability regime, for instance, will become uncertain in the context of autonomous vehicles. Liability in traffic-related matters will, therefore, evolve from a fault-based mechanism towards forms of strict liability. Particular attention is thereby given to the application of the EU Product Liability Directive. It will eventually be assessed who should be held liable for the damage caused by self-driving cars and other AI systems by an extension (de lege ferenda).

 

Details of the presentation may be found at: https://law.uq.edu.au/event/session/13582

Confinement has severely curtailed our freedom of movement, but it has certainly not put an end to disagrements and disputes.

Citizens and businesses needing to take procedural action in a cross-border case may be unable to do so due to emergency measures taken in an EU Member State in order to counter the spread of the COVID-19 virus.

These measures may result in the complete or partial suspension of the work of courts and authorities; the temporary inability to obtain legal aid; difficulty to access information normally provided by the competent authorities; other practical issues, for instance delays in enforcing a decision in a cross-border context or in serving a judicial document; temporary adjustments in terms of communication with the public (by email, by phone or by postal mail).

With this is mind, the e-Justice Portal has opened a page aiming to provide an overview of temporary measures taken within the European Union in relation to the COVID-19 virus. The page gives access to a table (pdf document) with information provided by the EJN contact points – and the usual disclaimer: ‘If you need additional information, please consult the webpages of the Ministry of Justice of the Member State for which you need information’

As the situation is changing rapidly and information on this topic is still evolving, the page is updated regularly to reflect new developments.

The EAPIL blog hosts an ongoing on-line symposium aimed to explore the impact of the coronavirus crisis on the phenomena of mobility and exchange that form the constituent elements of private international law, and to discuss the responses that private international law rules provide to the challenges posed by the crisis itself. Contributions on this topic have been proposed so far by Giovanni Chiapponi, Matthias Lehmann and Tomaso Ferando. Those interested in proposing a guest post for publication on these issues are encouraged to contact the blog’s editorial team at blog@eapil.org. 

In Representation of Lydian international Limited [2020] JRC 049 MacRae DB refers to universality in insolvency proceedings only once,  namely where he refers to authority at 20. Yet his approach in honouring the request for assistance, made by the courts at Ontario ‘on the basis of comity’, walks and talks like universality. This is of course reminiscent of Menon CJ’s recent speech on the issue, or similar decisions elsewhere.

‘Though there is no precedent in Jersey for a Canadian CCAA order or similar order being enforced or recognised in relation to a Jersey company, we had no doubt that we should assist the Canadian Court in this case.  There were no reasons of Jersey public policy impeding the court making the orders sought.  To the contrary, it is consistent with Jersey’s status as a responsible jurisdiction for the Royal Court to lend assistance in order to facilitate an international insolvency process in a friendly country that has a potential to benefit the creditors of the Lydian Group as a whole.’ The Deputy Bailiff also notes that key Jersey creditors and the Jersey corporation of the Lydian group itself were represented in the Canadian proceedings.

Geert.

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

 

#Insolvency.
Request honoured of the courts of Ontario to assist with proceedings on the basis of comity, universalism. https://t.co/vUelMOKdId

— Geert Van Calster (@GAVClaw) April 15, 2020

A quick note on [2020] EWHC 893 (Fam) I and L (children), in which Mostyn J berates and effectively disciplines a father’s abuse forum and process shopping.

At 11:

‘I pause at this point to reflect on the actions taken by the father. Not only did he act in bad faith, as I have explained, but he also was guilty not only of blatant forum shopping but also of process shopping. If the father had genuinely developed misgivings about the wisdom and merits of the parenting agreement signed by him on 5 August 2019 then the appropriate place to raise those misgivings was the court in South Africa [the habitual residence of the children, GAVC]. Instead, by a ruse de guerre he lured the mother and children to this jurisdiction where he immediately started proceedings in the forum which he considered to be most favourable to him. By striking pre-emptively he also selected the process which he considered most favourable to him. Had he merely retained the children on 3 January 2020 and awaited the mother to take steps in response she would, unquestionably, have raised a case under the 1980 Hague Convention on the Civil Aspects of Child Abduction. In such a process the welfare of the children, while being an important consideration, would not have been the paramount consideration. Instead, the court would have started with the position that the children should be returned to the place of their habitual residence unless the father could demonstrate a defence.’

In the end he held that under the Children Act, in which the welfare of the children is the paramount criterion, a return to their habitual residence (to be effected as fast as possible following the end of Covid-19 lock-down) is in their best interest, thus torpedoing the abuse. Clearly like in QD, the English courts do not appreciate cloak and dagger manipulation of forum or process.

Geert.

 

https://twitter.com/GAVClaw/status/1250359450357071873

The Russian Chamber of Commerce and Industry is issuing ‘force majeure certificates’, like some of their homologues in other countries, as discussed earlier in this blog. Although this practice has existed in Russia since 1993, the number of requests for the certificates has recently increased. The requests come not only from Russian companies but also from foreign entities. While the increase is understandable in these times of the coronavirus pandemic, under Russian law, the ‘force majeure certificate’ can (only) form a part of evidence in possible future disputes, as its impact on the outcome of the dispute is ultimately defined by the (Russian or foreign) courts or arbitration tribunals.

The Russian Chamber of Commerce and Industry (CCI) is issuing ‘force majeure certificates’, like some of their homologues in other countries. Although this practice exists in Russia since 1993, the CCI has recently noticed an increase in the number of requests for the certificates, due to the coronavirus pandemic. The requests come not only from Russian companies but also from foreign entities. What could be the practical value of the certificate in a contractual dispute relating to the consequences of the pandemic?

The legal basis for the CCI’s competence to issue the ‘force majeure certificates’ is laid down in the law ‘On the chambers of commerce and industry in the Russian Federation’ of 7 July 1993. Article 1 of the law defines the CCI as a non-state non-governmental organisation created to foster business and international trade. Along with other competences, the CCI may act as an ‘independent expert’ (art. 12) and may provide information services (art. 2) in matters relating to international trade. One of the services is the issuing of ‘force majeure certificates’. The Rules for issuing the certificates are defined by the CCI’s governing council. These Rules entrust the CCI’s legal department with assessing requests and advising whether the certificate should be issued. The advice is given on the basis of the documents that a party submits to substantiate their request, following the Rules.

Notably, the list of documents includes (a copy of) the contract, ‘which contains a clause on force majeure’ (point 3.3.2 of the Rules). This requirement is not accidental; it has to do with the non-mandatory character of the legal provision on force majeure. Article 401(3) of the Russian Civil Code provides for exoneration of liability for a failure to execute a contractual obligation due to the force majeure. This provision applies by default, if ‘the law or the contract does not provide otherwise’ (art. 401(3)). The parties may provide otherwise by including a clause about unforeseen circumstances, hardship, frustration, force majeure, or similar circumstances in the contract. This is, at least, the way Russian courts have applied art. 401(3) up to the present time. The Russian CCI does not appear to deviate from this approach.  More than 95% of the requests submitted to the Russian CCI for ‘force majeure certificates’ have so far been rejected, according to the head of the Russian CCI (even though some decrees deliberately label the COVID-19 pandemic ‘force majeure’ as, for example, the Decree of 14 March 2020 does, this decree is adopted by the municipality of Moscow to prevent the spread of the virus by various measures of social distancing).

Thus, the legal basis of the CCI’s competence to issue a ‘force majeure certificate’ implies that the certificate is the result of a service provided by a non-state non-governmental organisation. The application of Article 401(3) implies the need to interpret the contract, more specifically, the provision on force majeure it possibly includes. If the parties disagree on the interpretation, a dispute may arise. The competence to resolve the dispute lies with the courts or arbitration tribunals. In this way, the ICC’s decision (taken upon the advice of the CCI’s legal department) to confirm by issuing a certificate that a particular event represents a force majeure in the context of the execution of a specific contract can have persuasive authority in the context of the application of Art. 401 (3). However, it remains the competence of the courts or arbitration tribunals to apply art. 401(3) to the possible dispute and to establish the ultimate impact of the relevant events on the outcome of the dispute. Under Russian law, one would treat the ‘force majeure certificates’ issued by the CCI (and possibly a refusal to issue the certificate) as a part of evidence in possible future disputes. A (Russian or foreign) court or arbitration tribunal considering this evidence is free to make a different conclusion than that of the Russian CCI or may consider other evidence.

Your articles on private (and public) aspects of European and International Law may now be submitted for publication in Balkan Yearbook of European and International Law. The BYEIL also welcomes comments, book reviews and notes on recent case law.

The currently open call for papers welcomes submissions falling within the above description, as well as ones related to the CISG marking the 40th anniversary of the convention. The call, with the contact details, is available BYEIL call for papers 2020.

Yesterday the Hague Conference on Private International Law (HCCH) announced the publication of the Guide to Good Practice on the Use of Video-Link under the 1970 Evidence Convention. It is available in both English and French.

Needless to say that this publication comes in very handy in times of COVID-19 as borders are closed and travel is hampered. Hopefully, it will encourage Contracting States and everyone involved in cross-border litigation to make further use of videoconference in the taking of evidence abroad.

See our previous post here for some quick thoughts on the Guide. And in this regard, see pages 46 to 49 of the Guide. See also its Glossary; I include two main concepts below:

Direct taking of evidence

“The procedure of taking of evidence whereby the authority in the Requesting State before which proceedings are pending conducts the witness / expert examination directly.”

Indirect taking of evidence

“The procedure of taking of evidence whereby an authority in the Requested State in whose territory the witness / expert is located conducts the witness / expert examination.”

It is the direct taking of evidence that video-link is usually meant to facilitate but of course it can also assist in the indirect taking of evidence (e.g. the parties and representatives may be present by video-link).

The HCCH news item is available here.

On 2 April 2020, the conclusions of Advocate General Sánchez-Bordona in Verein für Konsumenteninformation v Volkswagen (Case C-343/19) were published. They add a new piece to the puzzle of locating purely economic loss – a much-discussed issue which was recently considered in this blog.

Facts

The case concerned a request by the Landesgericht Klagenfurt (Regional Court in Austria) for a preliminary ruling.  Austrian residents had purchased VW cars in their home country. Thereafter, it became known that the manufacturer had fitted the vehicles with illicit software which enabled them to flout emissions tests. Cars fitted with the software consequently dropped in market value. The buyers assigned their rights arising out of their losses to the Verein für Konsumenteninformation (VKI), an Austrian consumer protection association. VKI subsequently sued VW in Austria for damages. VW contested the jurisdiction of the Landesgericht Klagenfurt.

Legal issue

The request by the Landesgericht Klagenfurt for a preliminary ruling concerns the question of whether the Austrian courts have jurisdiction over VKI’s claim under Article 7(2) of the Brussels I bis Regulation. In cases of tort or delict, Article 7(2) confers special (meaning optional) jurisdiction on  the courts of the place where the harmful event occurred. The CJEU interprets “the place where the harmful event occurred“ as giving the tort victim a choice to sue either: (i) at the place of the event giving rise to the damage; or (ii) at the place where the damage occured. In the present case, the Austrian courts could only have jurisdiction under the second option.   Therefore, the crucial question was: where, on the present facts, did the damage ‘occur’ within the meaning of under Article 7(2) of the Brussels I bis Regulation.

Opinion of the Advocate General

Advocate General Sánchez-Bordona took the view that the damage occurred in Austria and that, consequently, the courts there had jurisdiction over the case under Article 7(2) of the Brussels I bis Regulation.

Legal standard

The Advocate General pointed to three well known precedents for determining the location of purely financial loss: Kolassa, Universal Music and Löber. In his view, these three CJEU judgments establish that the actual place where the damage occurred is only the starting point for determining the competent court. Thereafter, other specific circumstances of the dispute, taken as a whole would have to be considered (paragraph 56).

The Advocate General considered that such ‘other specific circumstances’ could include “1. factors relevant to the proper administration of justice and the effective conduct of proceedings; and 2. factors which may have served to form the parties’ views about where to bring proceedings or where they might be sued as a result of their actions.” (paragraph 67).

Further, the Advocate General pointed to the dual principles of proximity and foreseeability of the competent court, between which a reasonable balance must be struck (paragraphs 63-64).

Application to the present case

Applying these standards to the present case, the Advocate General opined that, in general, the location of the cars as tangible objects was irrelevant because it is unforeseeable (paragraphs 71-73). He instead considered the correct starting point for locating the loss to be the act through which the product became part of the victims’ patrimony, thereby causing the damage (paragraph 74). Hence, he identified the place of loss to be the place where the transaction for the purchase of the car was concluded (id.).

The Advocate General further viewed this location to be unaffected by the other specific circumstances of the case. In particular, the jurisdiction of the Austrian courts would have been foreseeable for the Defendant (paragraph 80).

Assessment

The result reached by the Advocate General is certainly agreeable. The purchasers of rigged cars should not be forced to start legal proceedings at the seat of the manufacturer. Rather, they should have the ability to sue the tortfeasor closer to their homes. The same place should also be used to identify the applicable law to their claims under Article 4 of the Rome II Regulation.

It may, however, be a little too simplistic to identify the place of loss as the place of the relevant sales transactions. This place is notoriously uncertain, fortuitous, and vulnerable to manipulation. The purchasers could, for instance, have met the vendor at a car fair, or they could have bought the cars in another country for tax reasons. Should this really determine the location of their loss? Moreover, ‘locating’ a sales transaction can be very tricky; for instance, in the case of purchases on the internet. For these reasons, the law of the place where the contract was concluded (lex loci solucionis) was largely ousted from the conflicts rules for contractual obligations. It would be paradoxical if it made a comeback through non-contractual obligations.

The other circumstances of the case should be taken more seriously. These other factors could, for instance, include the purchasers’ domicile and the place where they mostly use the cars. It is indeed a combination of factors that must be used in cases like the present one to determine the place where the damage occurred.

A late post (I am slowly trying to mop up my back issues; none of them thankfully going back quite as far as this one) on Roberts v The Soldiers, Sailors, Airmen And Families Association & Anor [2019] EWHC 1104 (QB) in which Soole J had to hold on whether the Civil Liability (Contribution) Act 1978 (the 1978 Act) has mandatory/ overriding effect and applies automatically to all proceedings for contribution brought in England and Wales, without reference to any choice of law rules. A tortious and residual private international law (as opposed to Rome I or II) take therefore on similar issues as in the contracts case of Lamesa Investments.

Claimant was born at the Hospital in Viersen, North-Rhine Westphalia, Germany on 14 June 2000. The Hospital provided medical services to UK Armed Forces stationed in Germany, with whom the Claimant’s father was serving, and their families. His claim is that he sustained an acute profound hypoxic brain injury as a result of negligence in the course of his delivery by a British midwife supplied by the First Defendant charity (SSAFA). On his behalf it is alleged that SSAFA and/or the Second Defendant (MOD) are vicariously liable for her acts or omissions.

The Hospital contends that the application of the 1978 Act is subject to choice of law rules, whose effect is to apply German law to a claim for contribution. By the combined effect of the German law of limitation and s.1 Foreign Limitation Periods Act 1984 the contribution claim is time-barred; and therefore must fail. SSAFA/MOD accept that, if choice of law rules prevail, the relevant law is German and the claim time-barred. However they contend that the 1978 Act has overriding effect. Since the limitation period under the 1978 Act expires 2 years from the date of judgment award or settlement (s.10 Limitation Act 1980), the claim can proceed.

Rome II is not engaged ratione tempore (it may have varied the outcome).

Soole J first summarises at lenghth the submissions of the parties, including their scholarly references. He then, at 81, reminds us of the common law approach to characterisation (one which we successfully pleaded in a continental court in a trust case recently): ‘the first question in such a dispute is the characterisation (or classification) of the claim or issue in question. Such classification should not be constrained by particular notions or distinctions of the domestic law of the lex fori, or that of the competing system of law, which may have no counterpart in the other’s system; and should be taken in a broad internationalist spirit in accordance with the principles of conflict of laws of the forum’.

He then holds that the questions of lois de police do not justify cutting corners in conflict of laws analysis: one does not jump straight to application of a local act. Rather, one dutifully follows conflicts analysis and then applies the local act only if and to the extent the foreign law impedes it. Then follows at 92 his classification of the act as lois de police indeed (the terminology used here also includes ‘extraterritorial application’ which however suggests a disconnect from the usual conflicts exercise): ‘In my judgment it is implicit from the provisions of the 1978 Act that the statute does have overriding effect; and that the presumption to the contrary is accordingly rebutted. And at 93: ‘I consider that the express references in the 1978 Act to private international law (ss.1(6), 2(3)(c)) support this implication. Parliament having chosen to identify specific circumstances in which choice of law rules are to apply (and the extent of that application) in a claim under the statute, the natural implication is that the availability of this statutory cause of action was not itself to be subject to choice of law rules.’

Most interesting judgment.

Geert.

 

 

By Nadia Rusinova

Currently large increases in COVID-19 cases and deaths continue to be reported from the EU/EEA countries and the UK. In addition, in recent weeks, the European all-cause mortality monitoring system showed increases above the expected rate in Belgium, France, Italy, Malta, Spain, Switzerland and the United Kingdom.

It is not unreasonable to predict that COVID-19 will be used increasingly as a justification in law for issuing non-return order by the Court in international child abduction proceedings, return being seen as a “grave risk” for the child and raised as an assertion under Article 13(b) of the Hague Convention.

What would be the correct response to these challenging circumstances, when the best interest of the child in child abduction proceedings calls for restoration of status quo ante under the Hague convention on the Civil Aspects of International Child Abduction (hereinafter: the Convention)? This post will focus on the recent judgment [2020] EWHC 834 (Fam), issued on 31 March 2020 by the High Court of England and Wales (Family Division) seen in the light of the ECtHR case law on the child abduction, providing brief analysis and suggesting answer to the question if the return of the child to the state of its habitual residence in the outbreak of COVID-19 can constitute grave risk for the child under Article 13(b) of the Convention, and how the practitioners and the Court should approach these assertions in the present pandemic situation.

The facts of Re PT [2020] EWHC 834 (Fam)

PT (the abducted child) and both of her parents are all Spanish nationals. PT was born in 2008 and had lived all of her life in Spain, until she was brought to England by her mother, HH, in February 2020. She is the only child of the parents’ relationship. They separated in 2009. Following the parents’ separation, legal proceedings were brought in Spain by the mother concerning PT’s welfare. A judgment was issued in these proceedings by the Spanish Courts on 25 May 2012, providing for the mother to have custody and for parental responsibility for the child to be shared by both parties. The order provided for the father to have contact with PT on alternate weekends from after school on Friday until Sunday evening. In addition, she was to spend half of each school holiday with each parent. The order also required that the parents should inform each other of any change in address thirty days in advance.

On or about 13 February 2020, the mother travelled to England with PT. The mother’s partner (with whom she is expecting a child the following month) lives in the South East of England, and they have moved in with him. The evidence on behalf of the father is that the child was removed from Spain by the mother without his knowledge or consent.

The father asked the mother to return PT to Spain, but she refused to do so. The father travelled to the UK and met with the mother and PT at a shopping centre. However, the mother again refused to permit the child to return to Spain. She did however permit PT (and S) to spend a night with the father at his hotel in England.

The case first came before the Court on 10 March 2020 on a “without notice” basis. At that hearing the mother attended in person, and indicated that she would be seeking to defend the application on the basis of (1) the father’s consent and / or acquiescence and (2) Article 13(b) of the Hague convention – claiming existence of a grave risk that a return would expose the child to physical or psychological harm or otherwise place the child in an intolerable situation.

On that occasion PT was, as directed by the judge, present in the Court vicinity to be interviewed by the CAFCASS (Children and Family Court Advisory and Support Service) Officer. She told CAFCASS that she had not wanted to come to England, and that she wanted to be with her father, although she did not want to be separated from her mother either. PT’s clear wish was that she wanted to return to Spain with her father rather than stay in England.

The judgment

The Court is entirely satisfied on the evidence that PT is habitually resident in Spain as she had lived there all of her life until she was recently brought to the UK. In this case the Court ruled that PT has been wrongfully removed from Spain within the terms of Article 3 of the Convention and that none of the Article 13 defences have been made out. Therefore, return order for the summary return of PT to Spain has been made.

Comments

First of all, in such cases the Court should unavoidably take the challenge to identify the risks for the child in case of return in the context of the pandemic situation. Indeed, in the present case the formulation is rather simplified. Therefore and due to the lack of case law on this issue, and in order to be able to answer the question if the return of the child would pose a grave risk, we should take a look also at the recently published Guide to Good Practice on Article 13(1)(b) (hereinafter: the Guide) by the Hague Conference On Private International Law (HCCH) and the concept of “grave risk” in child abduction proceedings in general, as set by the ECtHR in its case law.

In general, the grave risk exception in child abduction cases is based on “the primary interest of any person in not being exposed to physical or psychological danger or being placed in an intolerable situation”, as stated in the § 29 of the Explanatory report to the Hague Convention. The general assumption that a prompt return is in the best interests of the child can therefore be rebutted in the individual case where an exception is established. It is important to note that the exception provided for in Article 13(b) concerns only situations which go beyond what a child might reasonably be expected to bear (Ushakov v. Russia § 97, X v. Latvia § 116, Maumousseau and Washington v. France §§ 69 and 73, K.J. v. Poland §§ 64 and 67)

In § 46-48 of the discussed judgment the Court points final argument relates to the risk of physical harm that is presented by the current coronavirus pandemic in the following way:

“…This risk presents itself in two ways:

(1) The pandemic is more advanced in Spain than in the UK. As at the date of the preparation of this judgment (29 March) the official death toll stood at 1,228 in the UK and 6,528 in Spain. It could therefore be argued that PT would be at greater risk of contracting the virus in Spain than in the UK.

(2) The increased risk of infection that is posed by international travel at this time.”

Did the Court explore all possible harm that the return order can bring, and since it is recognized that the risk is present, what specific kind of risk the return of the child would constitute in the context of the pandemic situation – physical or psychological danger, or being placed in an intolerable situation?

The way the Court approached this issue is a very basic attempt to identify the risks that a return order in the outbreak of COVID-19 can bring to the child. As the Guide points in § 31, although separate, the three types of risk are often employed together, and Courts have not always clearly distinguished among them in their decisions. It is clear that the return could bring physical danger of contamination with COVID-19 together with all possible complications, despite the fact that child is not in the at-risk groups as are the elderly or other chronically ill people. But we should not underestimate the psychological aspect of the pandemic situation. As the coronavirus pandemic rapidly sweeps across the world, the World Health Organisation has already, a month earlier, stated that it is inducing a considerable degree of fear, worry, and concern in the population. It is therefore out-of-the-question that for a relatively mature child (in this case of 12 years old), whether the  ability to watch, read or listen to news about COVID-19 can make the child feel anxious or distressed and therefore can, and most likely will, bring also psychological harm to it. In this sense the potential psychological harm is inevitable and whilst the physical harm can or cannot happen, and indeed the contamination cannot be foreseen, in any case with the return order (especially to a state with significant risk of increasing community transmission of COVID-19) the psychological integrity of the child will be put at immediate risk.

In order to explore how this risk can be adequately assessed in child abduction proceedings in the context of the COVID-19, we should look at § 62 of the Guide, where HCCH explicitly discusses risks associated with the child’s health, stating that “In cases involving assertions associated with the child’s health, the grave risk analysis must focus on the availability of treatment in the State of habitual residence, and not on a comparison between the relative quality of care in each State”. How is this applicable to the pandemic situation, if at all? It seems like the only adequate response in these fast-changing unprecedented circumstances would be that the Court should indeed not compare the situations in both states, but still having in mind the nature of the COVID-19, to try to foresee the developments, relying on the general and country-specific health organizations reports, accessible nowadays online in a relatively easy way.

As a first step the Court should consider whether the assertions are of such a nature, with sufficient detail and substance that they could constitute a grave risk, as overly broad or general assertions are unlikely to be sufficient. In this situation, without precedent in the history of the Convention’s application, holding that “Although the course of the pandemic is clearly more advanced in Spain than in the UK, I do not have any evidence from which I can draw a conclusion that either country is any more or less safe than the other… I am simply not in a possession to make any findings as to the relative likelihood of contracting the virus in each country. On the material before me, all that I can conclude is that there is a genuine risk that PT could contract the virus whether she remains in England or returns to Spain.” does not fulfil the obligation of the Court to assess the risk in full, in all its possible implications. The Court is obliged to conduct the step-by-step analysis, prescribed by and explained in the Guide, and to examine the types of risk for the child, assessing it separately and in the context of their deep interrelation in these specific circumstances.

Secondly, the wording of Article 13(b) also indicates that the exception is “forward-looking” in that it focuses on the circumstances of the child upon return and on whether those circumstances would expose the child to a grave risk. Therefore, ECtHR is clear that in any case (regardless the context and for sure not only in cases with history of domestic violence), where such assertions have been raised, the Courts should satisfy themselves that adequate safeguards and tangible measures are available in the country of return  (Andersena v. Latvia §118, Blaga v. Romania §71).

In addition, as the Guide points in § 53, Article 13(b) analysis should be always be highly factually specific. Each Court determination as to the application or non-application of the exception is therefore unique, based on the particular circumstances of the case. A careful step-by-step analysis of an asserted grave risk is therefore always required, in accordance with the legal framework of the Hague convention, including the exception as explained in the Guide. When we discuss this issue, not only the Convention, but also Article 11(4) of Brussels IIa applies in answering the question of, what in the case of COVID-19 are “adequate safeguards”. This is, without a doubt, a question difficult to answer to with certainty, as the case law of the ECtHR and the Guides do not contain any directions or good practices on the behaviour of the domestic authorities in times of pandemic.

In the present case the judge estimated as “tangible safeguards” the following “number of undertakings”, offered by the father, effective until the matter could be brought before the Spanish Court, and intended to support PT’s return to Spain. They include: (1) Lodging the final order in Spain; (2) Not pursuing any criminal charges against the mother for her wrongful removal of PT from Spain to England; (3) Seeking to mediate with the mother on PT’s return in relation to the mother’s access; (4) Agreeing to unrestricted indirect contact between PT and her maternal family (especially with the mother and S):(5) Agreeing to direct contact for PT with her mother in Spain and England, to the extent that is possible or appropriate from a public health perspective given the current global pandemic;(6) Meeting with the mother only at neutral and/or public places when picking or dropping PT off;(7) To pay PT’s maintenance and school fees pending any further determination about maintenance by the Spanish Courts; and (8) To pay all the travelling costs (flights) for PT of travelling to and from England for the purposes of contact with the mother.”

It looks like the Court is indeed satisfied with the undertakings, but unfortunately, these examples are far from adequate protective measures when we consider the grave risk induced by return in the current pandemic situation. None are directed to prevention of the grave risk as raised by the mother, and none are related to the child’s health. Better examples remain to be seen from the upcoming case law of the Courts, but in the current situation, a strong focus should remain on comprehensive testing and surveillance strategies (including contact tracing), community measures (including physical distancing), strengthening of healthcare systems and informing the public and health community. Therefore, following the Guide, such measures should at the minimum include rapid risk assessment upon arrival at the state of habitual residence, application of different types of available COVID-19 Rapid Tests, ensuring social distance and exploring online education possibilities, providing guarantees that the child will be isolated and distanced from potentially infected people (through evidence for appropriate living conditions upon return), etc. Strong focus should also be put on the possibilities for mental support for the child, bearing in mind the extremely stressful situation, related not only the COVID-19 but also to additional factors such as the separation from the other parent and the mental consequences from the forced social isolation which, as pointed above, would inevitably affect the mental wellbeing of the child.

The next question is who should prove the risk, and its gravity in this specific situation?  Following the ECtHR case law, the burden of proof traditionally lies with the party opposing the child’s return  (Ushakov v. Russia, § 97). In this case the abducting parent indeed shall prove the grave risk, but it is true that the COVID-19 situation itself and the wide-spread precautions and information contribute a lot to proving this risk. Yet, what in the current pandemic circumstances is still to be proved by the abducting parent?

According to § 49 of the Guide, even if a Court ex officio gathers information or evidence (in accordance with domestic procedures), or if the person or body which has lodged the return application is not actively involved in the proceedings, the Court must be satisfied that the burden of proof to establish the exception has been met by the party objecting to return. However, in these specific circumstances, the national and international situation is developing at such speed that any evidence that could be gathered would be likely to be immediately outdated. Something very convenient for the abducting parent, it would be almost enough if the Court ex officio conducts check on the actual COVID-19 information regarding the state of habitual residence of the child, ensuring it is current when issuing the return or non-return order. However, this does not relieve the opposing party from the procedural obligation to present evidence as accurately as possible, and it remains important that arrangements regarding the “tangible safeguards”, discussed above, are offered and supported by evidence by the party which claims the return order.

There is a further discretionary ground in the Convention which permits a refusal of a return in certain circumstances where the child objects. According to Article 12 UNCRC, the child has the right to express its views freely, these views to be given due weight in accordance with age and maturity, and the Court should carefully examine them together with the other evidence (and not to provide stereotyped reasoning). The COVID-19 limitations raise the question should the child still be heard in this context and, if yes, how this should happen such that the risk for is minimised? Obviously, this right cannot and should not be waived in times when many procedural actions can take place online. It is worth to note that next to the existing legislation, Brussels IIa recast (Regulation 1111/2019, in force as of August 2022) pays special attention to the strengthening of the right of the child to express his or her view, reinforcing it with special provision – Article 26 in Chapter III “International child abduction”, in compliance with a detailed Recital 39. No minimum age is prescribed, but also no rules who can conduct the hearing of the child, how it must happen and where it should be conducted are set. Therefore, the hearing of the child should take place following the general conditions, and while the personal impression will indeed be reduced, and the possibilities to manipulate the child could potentially increase, the unlimited online tools to conduct the hearing eliminate the risk of contamination and offers acceptable solution for this emergency situation.

To get back to the discussed case – Re PT [2020] EWHC 834 (Fam), the Court is satisfied that the Art 13(b) defence has not been made out in this case. Many more comments could be made on the Courts assessment – the best interest of the child is not touched upon, the domestic violence is not discussed at all as an additional assertion, etc. One positive conclusion from procedural point of view is that the urgency has been taken into account, and that the Court made full use of the opportunities to conduct the proceedings online. Of course we cannot say that the return of a child during the COVID-19 pandemic constitutes a grave risk in all child abduction cases– but we can at least begin to build the good practices in this unprecedented time, when the “lockdown” will bring brand new meaning to the notion of “grave risk” under the Convention.

Nadia Rusinova is an attorney-at-law and lecturer in International and European private law at The Hague University, Netherlands. Next to her teaching and research activities, she is a regular ERA speaker and judicial trainer in children’s rights and international family law, delivering multidisciplinary trainings for legal professionals on international child abduction, children’s rights, ECtHR case law in family matters, LGBTQ rights, gender-inclusive language and trafficking of children. She is appointed as an expert in these areas of law in various projects, involving countries of broad geographic range. Originally Bulgarian, she holds an LL.M. degree from Sofia University, and for more than 15 years she has been successfully managing a specialized international family law office in Sofia, Bulgaria.

Dear CoL Readers,

While we are all deeply concerned about the still growing dimensions of the coronavirus pandemic, we did not want to give up working on the programme of our conference.

Thanks to the HCCH, the Bonn PIL colleagues and our distinguished speakers, there is now a fantastic programme we would like to bring to your attention in this post (see below).

Meanwhile, we will closely follow the instructions of the University of Bonn as well as the German local and federal governments and travel restrictions in other countries to see whether the conference can take place on site. We have not yet given up optimism in this respect. Yet, safety must be first. This is why we are setting up structures for a video conference via zoom in case we need it. We assume that all of you would agree to proceeding via zoom if necessary. We will take a final and corona risk-averse decision on this during July and keep you posted. Please do not hesitate to register with us (sekretariat.weller@jura.uni-bonn.de) if you wish to be updated by email.

Looking forward to seeing you in Bonn in September!

***

Brexit has become reality – one more reason to think about the EU’s Judicial Cooperation with third states:

The largest proportion of EU economic growth in the 21st century is expected to arise in trade with third countries. This is why the EU is building up trade relations with many states and other regional integration communities in all parts of the world. The latest example is the EU-MERCOSUR Association Agreement concluded on 28 June 2019. With the United Kingdom’s exit of the Union on 31 January 2020, extra-EU trade with neighboring countries will further increase in importance. Another challenge for the EU is China’s “Belt and Road Initiative”, a powerful global development strategy that includes overland as well as sea routes in more than 100 states around the globe.

The increasing volume of trade with third states will inevitably lead to a rise in the number and importance of commercial disputes. This makes mechanisms for their orderly and efficient resolution indispensable. China is already setting up infrastructures for commercial dispute resolution alongside its belts and roads. In contrast, there seems to be no elaborate EU strategy on judicial cooperation in civil matters with countries outside of the Union, despite the DG Trade’s realisation that “trade is no longer just about trade”. Especially, there is no coherent plan for establishing mechanisms for the coordination of cross-border dispute resolution and the mutual recognition and enforcement of judgments. This is a glaring gap in the EU’s policy making in external trade relations.

This is why the Bonn group of PIL colleagues – Moritz Brinkmann, Nina Dethloff, Matthias Lehmann, Philipp Reuss, and Matthias Weller – will host a conference on Friday and Saturday, 25 and 26 September 2020, at the University of Bonn that seeks to explore ways in which judicial cooperation in civil matters between the EU and third countries can be improved by the HCCH 2019 Judgments Convention as an important driver, if not game changer, of legal certainty in cross-border commercial relations.

The list of speakers includes internationally leading scholars, practitioners and experts from the Hague Conference on Private International Law (HCCH), the European Commission (DG Trade, DG Justice), and and the German Federal Ministry of Justice and Consumer Protection (Bundesministerium der Justiz und für Verbraucherschutz)

The Conference is co-hosted by the HCCH as one of the first European events for discussing the HCCH 2019 Judgments Convention. The Conference will be further supported by the Zentrum für europäisches Wirtschaftsrecht at the University of Bonn and The International Litigation Exchange (ILEX).

The Organizers will kindly ask participants to contribute with € 100.- to the costs of the event (includes conference dinner).

Dates:

Friday, 25 September 2020, and Saturday, 26 September 2020.

Venue:

Friday:

Universitätsclub Bonn, Konviktstraße 9, D – 53113 Bonn

Saturday:

Main Auditorium (Aula), Hauptgebäude, Am Hof 21, 53113 Bonn

Registration: sekretariat.weller@jura.uni-bonn.de

Registration Fee: € 100.-

To be transferred to the following account (you will receive confirmation of your registration only after payment was booked on this account):

Bonn Conference 2020

IBAN: DE71 5001 0517 0092 1751 07

BIC:    INGDDEFF (ING-Diba Bank)

 

Programme

Friday, 25 September 2020

1.30 p.m.     Registration

2 p.m.          Welcome note

Prof Dr Wulf-Henning Roth, University of Bonn, Director of the Zentrum für Europäisches Wirtschaftsrecht (ZEW)

Dr Christophe Bernasconi, Secretary General of the HCCH (video message)

2.10 p.m.      Part 1: Chances and Challenges of the HCCH 2019 Judgments Convention

Chairs of Part 1: Prof Dr Matthias Weller / Prof Dr Matthias Lehmann

Keynote: Hague Conference’s Perspective and Experiences

Hans van Loon, Former Secretary General of the Hague Conference on Private International Law, The Hague

1. Scope of application

Prof Dr Xandra Kramer, Erasmus Universiteit Rotterdam

2. Judgments, Recognition, Enforcement

Prof Dr Wolfgang Hau, Ludwig-Maximilians-Universität Munich

Discussion

3.30 p.m.     Coffee Break

4.00 p.m.      Part II: Chances and Challenges of the HCCH 2019 Judgments Convention

Chairs of Part 2: Prof Dr Nina Dethloff / Prof Dr Moritz Brinkmann

1. Jurisdictional filters

Prof Dr Pietro Franzina, Catholic University of Milan

2. Grounds for refusal

Prof Dr Francisco Garcimartín Alférez, University of Madrid

Discussion

5.30 p.m.     Panel Discussion: Prospects for Judicial Cooperation in Civil Matters between the EU and Third Countries

Chairs of Part 3: Prof Dr Matthias Weller / Prof Dr Matthias Lehmann

Colin Brown, Unit Dispute Settlement and Legal Aspects of Trade Policy, DG Trade (tbc)

Andreas Stein, Head of Unit, DG JUST – A1 “Civil Justice”

Dr Jan Teubel, German Federal Ministry of Justice and Consumer Protection

RA Dr Heiko Heppner, Attorney at Law (New York), Barrister and Solicitor Advocate (England and Wales), Chair of ILEX, Head of Dispute Resolution, Partner Dentons, Frankfurt

and perhaps more…

Discussion

7 p.m.          Conference Dinner

  

Saturday, 26 September 2020

9.00 a.m.      The context of the HCCH 2019 Judgments Convention

Chairs of Part 4: Prof Dr Moritz Brinkmann / Prof Dr Philipp Reuss

1. Lessons from the Genesis of the Judgments Project

Dr Ning Zhao, Senior Legal Officer, HCCH

2. Relation to the HCCH 2005 Convention on Choice of Court Agreements

Prof Paul Beaumont, University of Stirling

3. Relations to the Brussels Regime / Lugano Convention

Prof Marie-Elodie Ancel, Université Paris-Est Créteil

4. Brexit…

Dr Pippa Rogerson, Reader in Private International Law, Faculty of Law, Cambridge

Discussion

11:00 a.m.    Coffee Break

11:30 a.m.    Chairs of Part 5: Prof Dr Nina Dethloff / Prof Dr Matthias Lehmann

1. South European Neighbouring and Candidate Countries

Ass. Prof Dr Ilija Rumenov, Ss. Cyril and Methodius University, Skopje, Macedonia

2. MERCOSUR

Dr Veronica Ruiz Abou-Nigm, Director of Internationalisation, Senior Lecturer in International Private Law, School of Law, University of Edinburgh

3. China (OBOR)

Prof Zheng (Sophia) Tang, University of Newcastle

4. International Commercial Arbitration

Jose Angelo Estrella-Faria, Senior Legal Officer UNCITRAL Secretariat, International Trade Law Division Office of Legal Affairs, United Nations, Former Secretary General of UNIDROIT

Discussion

1.30 p.m.     Closing Remarks

Dr João Ribeiro-Bidaoui, First Secretary, HCCH

 

William S. Dodge (University of California, Davis) has published The New Presumption against Extraterritoriality in the Harvard Law Review.

Canons of statutory interpretation are sometimes said to promote continuity and stability in the law. Yet it is widely acknowledged that canons themselves often change. The presumption against extraterritoriality is a prime example. It evolved from a rule based on international law, to a canon of comity, to a tool for finding legislative intent. The presumption then fell into disuse for nearly forty years until it was reborn in EEOC v. Arabian American Oil Co. (Aramco) and substantially revised in Morrison v. National Australia Bank Ltd.

This Article makes three contributions. First, it describes the evolution of the presumption against extraterritoriality over two centuries, providing a detailed account of change in an important canon of interpretation. Second, the Article describes the new, post-2010 presumption, arguing — contrary to the conventional wisdom — that the current version of the presumption is superior to previous ones. Third, the Article addresses the problem of changing canons. It argues changing canons constitute a form of dynamic statutory interpretation, which imposes certain responsibilities: to justify the changed canon in normative terms, to explain the need for change, and to mitigate the transition costs.

The article can be freely accessed here.

This item has been in the queue a long time – apologies. Thank you Marco Vogels for reporting end of 2019 on the Rotterdam court’s approach re privilege in ECLI:NL:RBROT:2019:7856, a criminal prosecution involving Shell. Marco’s report is most complete and I am happy to refer.

Compare the Dutch approach to my earlier reports on the issue in England and in the US. The Rotterdam court takes the law of the place of establishment of the (self-employed) solicitors as the connecting factor, ditto for in-house lawyers (on which The Netherlands takes an unusual (bu continental European standards) position of professional privilege). However the court also held that privilege falls away for the whole in-house legal department and all its lawyers, foreign established or not, if the head of legal is member of the Executive Committee.

Geert.

Springer has recently published a new volume on Private International Law Aspects of Corporate Social Responsibility in the series Ius Comparatum – Global Studies in Comparative Law. The book has been edited by Catherine Kessedjian (University Panthéon-Assas Paris II) and Humberto Cantú Rivera (Universidad de Monterrey, Mexico).

This book addresses one of the core challenges in the corporate social responsibility (or business and human rights) debate: how to ensure adequate access to remedy for victims of corporate abuses that infringe upon their human rights. However, ensuring access to remedy depends on a series of normative and judicial elements that become highly complex when disputes are transnational. In such cases, courts need to consider and apply different laws that relate to company governance, to determine the competent forum, to define which bodies of law to apply, and to ensure the adequate execution of judgments. The book also discusses how alternative methods of dispute settlement can relate to this topic, and the important role that private international law plays in access to remedy for corporate-related human rights abuses.This collection comprises 20 national reports from jurisdictions in Europe, North America, Latin America and Asia, addressing the private international law aspects of corporate social responsibility. They provide an overview of the legal differences between geographical areas, and offer numerous examples of how states and their courts have resolved disputes involving private international law elements. The book draws two preliminary conclusions: that there is a need for a better understanding of the role that private international law plays in cases involving transnational elements, in order to better design transnational solutions to the issues posed by economic globalisation; and that the treaty negotiations on business and human rights in the United Nations could offer a forum to clarify and unify several of the elements that underpin transnational disputes involving corporate human rights abuses, which could also help to identify and bridge the existing gaps that limit effective access to remedy. Adopting a comparative approach, this book appeals to academics, lawyers, judges and legislators concerned with the issue of access to remedy and reparation for corporate abuses under the prism of private international law.

More information is available here.

By virtue of an ‘Act of Legislative Content’ pursuant to Article 44 Greek Constitution, the Hellenic Republic passed on April 13 a series of urgent measures for the overall protection of the public against the virus. Among the multitude of provisions emanating from various ministries, four articles feature an identical overriding mandatory rule.

In particular, the rule concerns four categories: Cancellation of flights [Article 61]; cancellation of marine transport (carriage of passengers) [Article 65]; package travel and linked travel arrangements [Article 70]; and contracts between tourism industry enterprises [Article 71]. The content of the provisions is common: instead of reimbursement, it offers the option of vouchers by carriers and businesses in the respective branches.

The wording is the following:

Provided that the pertinent rights are regulated by EU law, the above provisions shall additionally apply mandatorily to contracts concluded between the parties, irrespective whether they agreed on the application of Greek or foreign law.

 

Understandably, the above provisions raise interesting questions of PIL; Matthias Lehmann provided a first glance of the potential problems here.

In Terre Neuve SARL & Ors v Yewdale Ltd & Ors [2020] EWHC 772 (Comm), Bryan J entertains almost the entire jurisdictional chapter of the Handbook.

The proceedings are concerned with the alleged misappropriation of a sum of €10.6 million paid by the First Claimant (“Terre Neuve”) to the First Defendant (“Yewdale”) between July 2009 and September 2012, and thereafter allegedly misapplied with the alleged participation of other Defendants. The sums were paid pursuant to a tax optimisation scheme ultimately for the benefit of the Third Claimant (“Mr. Zahut”), who beneficially owned Terre Neuve and the Second Claimant (“Largely”). The scheme was allegedly created by a Mr. Sasson (now deceased), who gave tax advice through his company, the Third Defendant (“GPF”) and controlled Yewdale (an English company) and the Second Defendant (“REDS”) (a New York company).

In this preliminary judgment, plenty of the defendants challenge jurisdiction, even if as discussed at 11 ff, following judgment by Hancock J in [2019] EWHC 1119 (Comm), confirmed in [2019] EWHC 1847 (Comm), the action is already proceeding in England against Yewdale (which has been found to be a valid anchor defendant per Article 4 Brussels Ia) as well as a number of the overseas defendants: both those domiciled in Switzerland, and elsewhere. Co-defendants in current case were not involved in those earlier hearings.

Firstly, GPF, third defendant, challenges jurisdiction under Article 23 Lugano, more or less but not quite the same as Article 25 BIa. At 22 ff Bryan J cuts too many corners in my view. He extends CJEU precedent on Brussels I and Ia without question to Lugano construction. He unhesitatingly adopts English law (with Fiona Trust in the authority driver’s seat and with reference to the recent Etihad case) as the lex causae for the choice of court agreement. This is as lex fori additi I assume; the actual text of the choice of court agreement is not included in the judgment lest I looked over it however one can deduct the choice points to Switzerland. He is right in holding that the answer to the contractual construction of the choice of court agreement cannot be found in either Lugano or Brussels itself.

At 44 ff he decides that Claimants’ claims do not fall within the scope of any of the jurisdiction clauses in the Written Agreements, pointing away from England.

Next, a group of co-Defendants, who the Claimants allege were involved in and/or benefited from the misappropriation, challenge the jurisdiction of the English Court on various grounds, inter alia: that the claims against them are not sufficiently closely connected to be heard with the claims against the other Defendants in this jurisdiction, pursuant to Article 6(1) Lugano, and should instead be tried in Switzerland pursuant to Article 2 Lugano; that the claims against them would be more conveniently heard in Switzerland; that bringing proceedings against them in England is an abuse of process; that they should be tried in Switzerland pursuant to Article 5 Lugano; that proceedings against them in England are a breach of their rights under Article 6 ECHR; and that various agreements contain jurisdiction clauses which prevent the English Court from hearing the case against them.

In short (note all the authority he employs has been reviewed on this blog, both CJEU (e.g. Melzer) and English) Bryan J finds the cases are clearly related under Article 6 Lugano; forum non conveniens must not be entertained; and there is no abuse of EU law (a popular part of jurisdictional challenge following Vedanta); some of the defendants have submitted; Article 5 Lugano’s forum contractus is irrelevant for it only brings additional, not exclusive jurisdiction; Article 6 ECHR is clearly not breached (practical difficulties of attending, for instance, may be solved by modern means); arbitration in New York first of all does not engage an EU court and secondly of course arbitration is exempt from Lugano.

Finally the one co-defendant domiciled in Israel is nevertheless pulled into the English jurisdictional bath by application of residual English rules (serious issue to be tried; necessary and proper party).

Quite a lot to discuss by way of preliminary jurisdictional issue…

Geert.

 

A Lugano /Brussels I jurisdictional fest. Includes consideration of anchor defendants, A25 choice of court, A4 jurisdiction. https://t.co/vyrRJ9zIkS

— Geert Van Calster (@GAVClaw) March 31, 2020

On 1 April 2020, the UK Supreme Court ruled in Aspen Underwriting Ltd v Credit Europe Bank on the concept of insurance matters under the Brussels I bis Regulation and the scope of the protection it offers.

The background of the case was the loss of a vessel which took fire and then sank in the Gulf of Aden in 2013. The owners of the vessel negotiated a settlement agreement with the insurers (Aspen Underwriting) for a sum of $ 22m.

Before the loss, a Dutch Bank, Credit Europe, had funded the re-financing of the vessel and, in exchange, was assigned the insurance policy. However, the Bank did not participate in the negotiations after the loss and, at the request of the owners, issued a letter to the insurers requesting that they pay any claim to a nominated company, which the insurers eventually did.

Three years after the loss, it appeared that the owners had deliberately sunk the vessel in the Gulf of Aden. The insurers sued both the owners and the bank in London pursuant to an exclusive jurisdiction clause contained in the insurance policy. The bank challenged the jurisdiction of the English courts.

Two issues arose. The first was whether the jurisdiction clause was binding on the bank. The second was whether the bank could benefit from the special provisions relating to insurance matters in the Brussels Ibis Regulation, in particular Art 14 which provides that insurers may only bring claims in the court of the domicile of the beneficiary of the insurance.

Assignment of the Jurisdiction Clause

The bank was not a signatory of the insurance policy. It had been assigned the policy. Under the case law of the CJEU (Coreck, Case C-387/98), a third party will be bound by a clause if it became a successor to a party under the applicable national law. In this case, the applicable national law was English law.

The Supreme Court held that, under English law, the bank was not bound by the jurisdiction clause.

26. The Bank’s entitlement to receive the proceeds of the Policy in the event that there was an insured casualty rests on its status as an equitable assignee. It is trite law that an assignment transfers rights under a contract but, absent the consent of the party to whom contractual obligations are owed, cannot transfer those obligations (…). An assignment of contractual rights does not make the assignee a party to the contract. It is nonetheless well established that a contractual right may be conditional or qualified. If so, its assignment does not allow the assignee to exercise the right without being subject to the conditions or qualifications in question.

The bank, therefore, could have asserted its assigned rights in a way that was inconsistent with the terms of the Policy, including the jurisdiction clause. But the Supreme Court held that the bank had not:

29 In the present case the Bank did not commence legal proceedings to enforce its claim. Indeed, it did not even assert its claim but left it to the Owners and the Managers to agree with the Insurers the arrangements for the release of the proceeds of the insurance policy by entering into the Settlement Agreement. It is not disputed that the Bank was not a party to the Settlement Agreement and the Bank derived no rights from that agreement. The Letter of Authority, which the Bank produced at the request of the Owners and the Managers, enabled both the Insurers and Willis Ltd to obtain discharges of their obligations and to that end it was attached to the Settlement Agreement. The Letter of Authority facilitated the settlement between the Insurers and the Owners and provided the Owners/Managers with a mechanism by which the Bank as mortgagee, assignee and loss payee could receive its entitlement. At the time of payment of the proceeds of the Policy there was no dispute as to the Bank’s entitlement and no need for legal proceedings. There was therefore no inconsistency between the Bank’s actions and the exclusive jurisdiction clause. The Bank therefore is not bound by an agreement as to jurisdiction under article 15 or article 25 of the Regulation.

Matters Relating to Insurance

If the jurisdiction clause did not Apply, what was the applicable ground for jurisdiction? Was it the general rule for misrepresentation (Art 7(2)), or could the bank benefit from the special provisions in the Brussels Ibis Regulation on matters relating to insurance?

The insurers argued that these provisions were only available if the subject matter of the claim was, at least in substance, a breach of an obligation contained in, and required to be performed by, an insurance contract. The Supreme court rejected the argument as follows (from the Press Sumary of the Court):

The Supreme Court finds that the Insurers’ claims against the Bank are “matters relating to insurance” within the meaning of section 3 of the Regulation [41]. The Supreme Court notes that the title of section 3 is drafted in broader language than other sections of the Regulation, which refer to individual contracts [35]. It is also significant that the scheme of section 3 is concerned with the rights not only of parties to an insurance contract but also of beneficiaries and injured parties, who will typically be non-parties [36]. The recitals to the Regulation do not operate to narrow the scope of section 3 [37]. Whereas EU case law indicates that articles derogating from the general rule in article 4 should be interpreted strictly, article 14 operates to reinforce article 4 and so need not be read narrowly [38]. Even if section 3 were to apply only to claims based on a breach of an individual insurance contract, the insurance fraud alleged by the Insurers would inevitably entail a breach of the Policy [40].

Is there a Weaker Party Exception for Insurance Contracts?

Finally, the lower courts had ruled that the rationale for the special provisions on insurance matters were to protect weaker parties, and that the bank was not one.

The argument is rejected by the Supreme Court on the following grounds (from the Press Sumary of the Court):

The Supreme Court holds that there is no “weaker party” exception to the protection of article 14 [43]. Article 14 protects certain categories of person because they are generally the “weaker party” in a commercial negotiation with an insurance company, not because of their individual characteristics [44]. Whilst recital (18) explains the policy behind section 3, it is the words of article 14 which have legal effect [45]. Article 14 refers to the policyholder, the insured and the beneficiary without further qualification and derogations from the jurisdictional rules in matters of insurance must be interpreted strictly [46, 57]. In any case, it would undermine legal certainty if the applicability of section 3 were to depend on a case by case analysis of the relative strength or weakness of contracting parties. This is why the Court of Justice of the European Union (“CJEU”) has treated everyone within the categories identified in article 14 as protected unless the Regulation explicitly provides otherwise [47-49]. The CJEU only has regard to recital (18) in deciding whether to extend the protections of article 14 to persons who do not fall within the identified categories, not to decide whether a particular policyholder, insured or beneficiary is to be protected [50-56]. Further, in deciding whether to extend the protections of article 14 in this way, the CJEU seeks to uphold the general rule in article 4 [43].