CNP v Gefion. The CJEU on (not) applying Brussels Ia’s insurance section to insurance professionals, and on branch jurisdiction.

I reported on the AG’s Opinion in C-913/19 CNP here. The CJEU held on 20 May.

The case essentially queries the application of Section 3 BIa (‘matters relating to insurance’) and Section 2 (the ‘special jurisdictional rules’, in particular contract and tort) in the event of assignment and /or subrogation of claims from the natural person to a professional party. As many of us may have experienced, filing an insurance claim particularly in the automotive sector immediately engages 2, 3 or more distinct businesses: insurance agents, insurers, towing trucks and garages…. The case also discusses whether some of those business may be considered a ‘branch’ of the insurance company on account of their close relationship as experienced by repairers and insureds.

In the case at hand, a road traffic accident occurred in Poland, in which two vehicles collided. The person responsible for the accident had, before that time, taken out a contract for motor liability insurance with Gefion, domiciled at Denmark. The injured party paid to lease a replacement vehicle from the repair workshop to which his damaged vehicle had been entrusted. By way of payment for that lease service arrangement, that person transferred the claim against Gefion to the repair workshop pursuant to a contract for assignment of the claim. Slightly later, pursuant to a new contract for the assignment of claims, the repair workshop assigned that claim to CNP. CNP requested Gefion to pay it the amount invoiced for the lease of the replacement vehicle. That request was sent to the address of Polins, a limited liability company established in Poland,  which represented Gefion’s interests in Poland. Crawford Polska, a company established in Poland and entrusted by Gefion with loss adjustment, then validated the invoice relating to the leasing of the replacement vehicle in part and granted CNP part of the amount invoiced for such lease. In its correspondence, Crawford Polska referred to the possibility of making a claim against it as the entity authorised by Gefion, or directly against Gefion, ‘either under the general provisions on jurisdiction or before the court with jurisdiction for the place where the policyholder, the insured person, the beneficiary or any other person entitled under the insurance contract is resident or established’. CNP then brought an action against Gefion in Poland, citing the information published by Gefion according to which Polins was its principal representative in Poland.  Gefion opposes the subsequent payment order, arguing inter alia that the Polish courts do not have jurisdiction.

Gefion rely in large part on CJEU Hofsoe, which as I noted in my review of UKSC Aspen Underwriting, is not as clear as one might hope. The Court in CNP v Gefion refers again to Hofsoe and Voralberger and zooms in on the professional activities of the corporations involved: [40] no special protection is justified where the parties concerned are ‘professionals in the insurance sector’; [43] CNP recovers claims from insurance undertakings. This precludes  it from being regarded as a party in a weaker position than the other party.

This finding as such arguably has no impact on the authority of Aspen Underwriting, in which the professional party, the Bank, is the named loss payee under the Policy and therefore the “beneficiary” of that Policy.

[46] The Court then confirms that Section 2’s special jurisdictional rules do open up in such circumstances.

As to whether Crawford may be considered a Gefion branch, the Court employs the criteria suggested by the AG (see my review of the opinion) and notes [56] that Crawford has every power to carry out activities involving the loss adjustment and settlement of claims which are binding on the insurer, meaning that Crawford Polska must be regarded as a centre of operations which has the appearance of permanency, such as the extension of a parent body. [57] Whether that centre is materially equipped to negotiate business with third parties, so that they do not have to deal directly with the parent body, is something which the referring court has to verify (and which will therefore determine branch jurisdiction).

Per CJEU Ryanair, [59] Crawford’s role here seems to have been more than just a data hatch: it was an active contributor (in deciding, upon having given such overall authority by Gefion,  only half of the amount claimed would be settled) to the legal situation that led to the dispute in the main proceedings. Therefore provided the aforementioned ‘material equipment’ criterion is met, the dispute is to be regarded as ‘arising out of the operation of the branch’.

All in all a bit more follow-up work to be done by the referring court and, as I noted in my review of the AG’s Opinion, not great publicity for the predictability of jurisdictional rules.

Geert.

EU Private International Law, 3rd ed. 2021, para 2.293 ff, para 2.73 ff.

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