Much as expected, the Court has this week confirmed Kokott AG’s views on Article 24(1) and Article 8(4) Brussels I Recast. Please refer to my review of the Advocate General’s Opinion for detail of the case.
A request for voidance of a contract of gift of immovable property, on grounds of incapacity, is not covered by Article 24(1). The fact that the contract for which a declaration of invalidity is sought concerns immovable property is irrelevant to the issue of its validity, the immovable nature of the subject matter of the contract being only of marginal significance in that context (at 36). This does not endanger the ratio legis of Article 24(1): by ruling on the request for the avoidance of a contract of gift on the ground of the donor’s incapacity to contract, the court before which the dispute is brought is not required to carry out investigations strictly related to the immovable property concerned so as to justify an application of the rule of exclusive jurisdiction provided for in that article (at 37). In the present case, the action in the main proceedings is based on the alleged invalidity of the contractual obligation consisting of the conveyance of ownership of the immovable property, which, provided that the contract is valid, must be, and which was initially, performed in Austria. This therefore establishes jurisdiction for that court on the basis of Article 7(1) a of the Brussels I Recast.
The separate request for removal from the land register of the donee’s right of ownership, in turn is based on the invalidity of the conveyance of ownership and, therefore, on the right in rem relied on by the applicant in the main proceedings in the immovable property concerned:this action is covered by Article 24(1). This latter court may also rule on the request for voidance: there is a connection between the claims pursuant to Article 8(4) of Regulation 1215/2012. Unlike the AG, the CJEU does not add that this possibility for joinder must not be abused, however there is no reason why the prohibition of abuse must not apply to Article 8(4). Given the possibility of joinder, a race to court of course is triggered between, in this case, father and daughter.
Schmidt v Schmidt is once again a useful reminder for courts and notaries alike, not to shy away from contracts, gifts, matrimonial property etc. simply because it involves real estate located elsewhere. Plenty of the legal issues surrounding such constructions can be perfectly dealt with outside the locus rei sitae.