Tag: applicable law

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Lambert v MIB. On foreign applicable law, and how the motor insurance Directives engage with Rome II for accidents abroad, litigated in England.

It is interesting to imagine the legal position in Lambert v Motor Insurers’ Bureau (Rev1) [2022] EWHC 583 (QB) in a scenario of retained EU law post Brexit, rather than firmly within the scope of the Brussels Ia Regulation and applicable law under Rome II. By the mechanisms of EU consumer law and EU insurance law, mixed with the finest legal machinery in the area of subrogation, a UK resident party injured in a motor accident (here: at a private racing circuit in Spain) abroad is entitled to claim compensation from the Motor Insurers’ Bureau (‘MIB’) in certain circumstances, clarified by the UKSC in Moreno v MIB [2016] UKSC 52. Crowther DJ summarises these circumstances as [6]

broadly speaking, that the guarantee fund of the member State in which the accident occurred would be liable to compensate the injured person on the facts of the individual case, when applying the rules of the local law which govern such actions by injured persons against the local guarantee fund. In other words, if Mr Lambert can show that the Spanish guarantee fund would have been liable to him in respect of the accident, he can claim such compensation from the MIB as would have been payable by the local guarantee fund. It is common ground in this case that the scope of the insurance obligation for use of motor vehicles under Spanish law extended to cover participation in the track event, notwithstanding the fact that it was not on a road or other public place.

The latter element is unlike the UK where seemingly third party motor insurance for motor sport is not commercially available.

The law applicable to the claim is agreed to be English law. While not specified in the judgment, this is presumably because of Article 4(2) Rome II (where the person claimed to be liable and the person sustaining damage both have their habitual residence in the same country at the time when the damage occurs, the law of that country shall apply): both Mr Lambert, claimant, and Mr Prentice, said to be responsible for the accident, were participants in a track event, organised by a UK based track day operating outfit called Track Sense; both travelled to Spain from the UK.

Spanish law however determines the preliminary issue as highlighted by the Supreme Court, Spanish law being the law which would have been applicable to any hypothetical claim which Mr Lambert might have brought against the Spanish guarantee fund. This is where things get interesting. The Motor Insurance Directives support a direct claim against one’s national MIB, subject to the law of the MS where the accident happened, sustaining liability in the circumstances. However Rome II somewhat curtails its action radius by declaring that it does not apply to ‘evidence and procedure’. This is a carve-out which is problematic in specific instances as I explain ia here. On such instance are issues of limitation however these it seems ([14)] were not pursued.

In the case at issue, parties’ agreement ([9]) is that by analogy to A1(3) Rome II, matters of evidence and procedure are outside the scope of the material substantive law and fall to be determined in accordance with English law as the law of the forum (lex fori in principle determines issues of evidence and procedure). Equally, on an analogous basis to A22(1) Rome II, parties agree that Spanish law will apply insofar as it contains rules which raise presumptions of law or determine the burden of proof.

The common law treating foreign law as fact, means the content of that foreign law is established often with the help of parties (if need be cross-examined) experts however [17] is for the English judge to determine. The remainder of the case therefore is spent discussing the expert evidence (with the judge doing some fine distinguishing of the case-law both experts referred to) together with the factual elements, to conclude [94]

Mr Lambert’s actions were 25% causative of the accident and Mr Prentice’s 75%. It follows that Mr Lambert’s claim for damages against MIB succeeds to the extent of 75% of his loss or damage.

Lest my understanding of the insurance Directives fails me (which it could well do), this means that claim on 75% of the damage remains to be judged under English  tort law. With presumably a repeat of the causation test, this time under English law.

A clearly written judgment which no doubt benefitted from the considerable practice experience of the judge on the matters at hand.

Geert.

 

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Zubaydah v Foreign Office. Court of Appeal reverses not altogether convincingly on the law applicable to illegal rendition cases.

Zubaydah v Foreign And Commonwealth Office & Ors [2022] EWCA Civ 334  discusses the same issue as Rahmatullah and Ali v MOD and FCO which I review here (and in which I later inserted the High Court judgment in current case).

What law is applicable to torts allegedly committed by the UK Security Services against a detainee subjected to “enhanced interrogation techniques” by the US CIA. The essence of the claimant’s claim is that the Services were aware that the claimant was being subjected to extreme mistreatment and torture at secret CIA “black sites” in six different countries, but nevertheless sent numerous questions with a view to the CIA eliciting information from him, expecting and intending (or at any rate not caring) that the claimant would be subject to such mistreatment and torture at interrogation sessions conducted for the purpose of attempting to obtain this information.

The first instance judge had refused to overturn the mosaic of six applicable laws (of the countries involved: Thailand, Poland, the US’ base at Guantanamo Bay, Morocco, Lithuania  [see also Zubaydah v Lithuania at the ECtHR] and Afghanistan) which follows from the standard application of the residual English conflict of laws rules (the EU Rome II Regulation does not apply): these point to lex locus damni. Males LJ to my mind unconvincingly does overturn that general rule, with  some reliance on the Supreme Court in VTB Capital Plc v Nutritek. 

The Court holds [37] that the judge had failed to focus on the tort allegedly committed by the UK Services (with too much emphasis on the treatment of claimant in the six countries, by the CIA); [38] wrongly discounted the reasons advanced by claimant for saying that the factors connecting the tort with the Six Countries were of reduced significance (this includes the fact that the claimant had no control whatever over his location and in all probability no knowledge of it either; and that there was a (jurisdictional) forum shopping element in the transfers to the 6 countries: keeping him away from jurisdictions with less forgiving rules on the practices concerned); and [40] the fact that the actions taken by the Services were undertaken “for the perceived benefit of the UK”, that is to say in the interests of this country’s national security.

The reasonable expectations of claimant play a big role in the analysis: claimant could have expected [41] that the conduct of any country’s security services having to do with him would be governed by the law of the country concerned. As for the Services, they would reasonably have expected that their conduct here would be subject to English law.

Throughout the judgment Males LJ puts great emphasis on what he notes [22] as an overarching aim of the relevant Act, which is ‘the reasonable and legitimate expectations of the parties to a transaction or an occurrence.’ However that is the Law Commission’s view on the raison d’être of conflict of laws full stop. I am not so sure it can serve as a determinative principle in the application of a specific rule of the Act.

I am not saying that the outcome of the case is wrong. Yet the judgment gives the impression of a correction of the judge’s factual balancing act between the different factors, rather than an error of law, and the emphasis on legitimate expectations feels a bit artificial in the circumstances. Add to this that [35] nobody suggested on the facts of this case that one applicable law might apply to the tort of misfeasance in public office and another to the tort of false imprisonment. Both parties proceeded on the basis that the law applicable to the claimant’s claims as a whole was either English law or the law of the Six Countries, and so did the Court of Appeal. This, too, may make the judgment’s authority limited.

Finally Males LJ holds obiter [51 ff] and correctly that it is too early to decide whether the application of the foreign laws, had they been applicable, would have had to be set aside on the basis of ordre public: while some evidence on the law of the 6 countries had been presented, there had not yet been proper discussion of same.

Geert.

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Mahmood v The Big Bus Company. At cruise-speed getting to choice of law under the Rome Convention.

Mahmood v The Big Bus Company [2021] EWHC 3395 (QB) is a good illustration of the applicable law process under the 1980 Rome Convention and its inclusion on the blog is mostly for pedagogic /teaching purposes. It even might be a good illustration of the bootstrap principle (meaning an issue on the very existence of the contract needs to be determined by the putative lex contractus) except [94] parties agree that whatever the conclusion as to the applicable law, UAE law can be deemed to be the same as English law in relation to the validity, construction, and effect of the Heads of Terms.

On 27 July 2001, during discussions in London regarding a possible joint venture to operate tour buses in Dubai, the parties signed a document entitled “Heads of Terms”.

Claimant says the Heads of Terms gave rise to a binding contract between the parties, which the Defendant subsequently breached.  The claim is resisted by the Defendant, arguing that, whether assessed under the law of England and Wales or under the law of the UAE, the claim is time-barred.  In the alternative, the Defendant contends there was no binding contract between the parties, or, if there was, that it was superseded by events that took place in 2002, or that the Claimant acted in repudiatory breach of any such contract, whereas the Defendant itself did not breach a contractual obligation owed to the Claimant.  It further disputes that there is any basis for the damages claimed by the Claimant in these proceedings.

The blog’s interest in in the first Q only and this is where [65] ff Eady J does a good job at applying the Convention without verbosity. Reference is best made to the judgment itself.

Geert.

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No Harry, don’t look at the light! The CJEU in Sharewood on Rome I’s rei sitae exception to consumer protection.

In C-595/20 Sharewood, the CJEU last week held on the extent of Rome I’s rei sitae exception to consumer contracts. In essence, as a result of Article 6 Rome I, for consumer contracts, choice of law is free (in the case at issue this lex voluntatis was Swiss law) except the consumer may always fall back on the mandatory laws of his habitual residence (here, Austrian law).

For a limited selection of contracts, including (A6(4)c) ‘a contract relating to a right in rem in immovable property or a tenancy of immovable property other than a contract relating to (timeshares)’, party  autonomy is restored in full under the terms of Articles 3 and 4 Rome I, hence the consumer loses his protection.

The contract at issue is a tree purchase, lease and service agreement. The trees at issue are grown in Brasil. The ground rent for the lease agreement, which granted the right to grow the trees in question, was included in the purchase price of those trees. The service agreement provided that ShareWood would manage, administer, harvest and sell the trees and would remit the net return on the timber to UE, the (anonymised) consumer. The difference compared to the gross return, expressed as a percentage of the return, was retained by ShareWood as its fee for the provision of those services.

The question in the case at issue is essentially how intensive the link to (foreign) soil needs to be for it to fall under the rei sitae carve-out for consumer contracts. The CJEU does refer to some of its Brussels Ia case-law, including Klein and Kerr, for the ‘tenancy’ element of the question, but not for the ‘rights in rem’ part of the discussion, where it more straightforwardly concludes on the basis of the contractual arrangements that the trees [28]

must be regarded as being the proceeds of the use of the land on which they are planted. Although such proceeds will, as a general rule, share the same legal status as the land on which the trees concerned are planted, the proceeds may nevertheless, by agreement, be the subject of personal rights of which the owner or occupier of that land may dispose separately without affecting the right of ownership or other rights in rem appertaining to that land. A contract which relates to the disposal of the proceeds of the use of land cannot be treated in the same way as a contract which relates to a ‘right in rem in immovable property’, within the meaning of Article 6(4)(c) of the Rome I Regulation

and [37]

the main purpose of the contract at issue in the main proceedings is not the use, in the context of a lease, of the land on which the trees concerned are planted, but… to generate income from the sale of the timber obtained following the harvest of those trees. As is apparent from the order for reference, the lease provided for in that agreement, which includes only the right to allow those trees to grow and has no purpose other than the acquisition of those trees, is intended merely to enable the sales and services elements provided for in the contract to be carried out.

Not caught therefore by the rei sitae exception.

I often refer my students to Harry, in A Bug’s Life, to make the point that both for jurisdictional and for applicable law purposes, the mere presence of real estate does not lead to the rei sitae jurisdictional and governing law implications being triggered. CJEU Sharewood is a good illustration of same.

Geert.

 

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Khalifeh v Blom Bank. On implied choice of law and consumer contracts (including ‘direction of activities’ in Rome I.

Khalifeh v Blom Bank SAL [2021] EWHC 3399 (QB) is the second High Court judgment in the space of a few weeks to involve Lebanese Banks and the application of the protective regime for consumers in EU private international law. (See earlier Bitar v Banque Libano-Francaise).

Foxton J explains why there is such activity: difficult financial conditions faced by Lebanese banks and their customers at the current time, and the practical impossibility of transferring foreign currency out of Lebanon, caused acute anguish for those with foreign currency accounts in Lebanese banks. Understandably they have explored every avenue open to them in an effort to access their hard-won savings.

Jurisdiction would seem not to be in dispute (presumably given the presence of non-exclusive choice of court in a general agreement), applicable law is. Even in consumer contracts, Article 6 Rome I allows parties to the contract to chose applicable law – except such choice must not deprive the consumer of the protection of the mandatory elements of the law that would apply had no choice been made: that ‘default law’, per Article 6(1) Rome I, is the law of the consumer’s habitual residence.

Whether choice of law has been made is to be determined in accordance with Article 3, which proscribes that choice of law must be  either nominatim, or ‘clearly demonstrated’ by the circumstances of the case. The latter is often referred to as ‘implicit’ choice of law although there is nothing truly implicit about it: choice of law cannot be made happenstance, it must have been made clearly (even if not in so many words). [47] ff the judge considers whether ‘implicit’ choice has been made, referring to Avonwick,  and holds [66] that there was, namely in favour of Lebanese law. He concludes this as a combined effect of

a jurisdiction clause in a related, general agreement which he found to be exclusive [63] in favour of Beirut; I have to say I do not think the judgment engages satisfactorily with the argument that this hybrid clause itself is questionable under the lex causae (including consumer law) that would have to apply to it;

the express reference to an agreement to comply with and facilitate the enforcement of identified provisions of Lebanese law; and

the express choice of Lebanese law in a closely related and interwoven contract.

Clearly some of this analysis is fact-specific and subjective however in my view the lex causae element of hybrid choice of court has more beef to the bone.

As for the issue of ‘activities directed at’ the UK, this is discussed [68] ff. First up is an interesting discussion on the relevant time at which the habitual residence of the consumer has to be considered. In light ia of CJEU Commerzbank, which presumably was not available at the time of the discussion, I would suggest the conclusion [73] that the temporal element needs to be fixed at the very beginning, to avoid see-sawing and dépeçage, may need revisiting.

In terms of the actual directing of activities, Pammer /Alpenhof of course is discussed as is Emrek. Having discussed the evidence, the conclusion [105] ff is that there was no direction of activities.

As a result, the remainder of the judgment deals with the substantive issues under Lebanese law.

I do not know whether permission to appeal has been sought. There are sections in the judgment that in my view would merit it.

Geert.

EU private international law, 3rd ed. 2021, Heading 2.2.9.2.7, 2.270 ff; Heading 3.2.4, Heading 3.2.5.

 

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Kazakhstan Kagazy v Zhunus. Again on qualification and a rather untidy application of Rome II in the context of an assets tracing claim.

Kazakhstan Kagazy Plc & Ors v Zhunus & Ors [2021] EWHC 3462 (Comm), sees Henshaw J unpicking the follow-up to a trial of applications and claims made by the Claimants for the purpose of enforcing an unsatisfied judgment for approximately US$300 million, handed down in December 2017.

The relevant part of the complex judgment, for the purposes of the blog, is a ‘tracing claim’: claimant argue that monies stolen from them by one of the defendants can be traced or followed into a variety of assets said to be held by companies within Cypriot trusts structures for the benefit of said defendant and his family. What is being traced are shares in Exillon, an oil company which Mr Arip developed after he fled Kazakhstan for Dubai. The proceeds of the shares went partially into the purchase of real estate, with another (substantial) part remaining liquid in a Swiss bank account.

Defendants submit that the tracing claim is governed by Kazakh law, and that that law does not recognise the concept of tracing. The judge, with respect, and perhaps he was echoing submissions, takes a rather unstructured approach to the conflict of laws analysis from which the judgment subsequently never recovers. Many first instance judgments in the UK intuitively start by quoting a relevant section from Dicey (whose 16th ed I am told might be out end of 2022), and then somehow engineer the analysis around it. In the case at issue, the Dicey rule that is zoomed in on [85], is disputes over real property, which are subject to lex situs (lex rei sitae). At [88] the judge then refers to Akers v Samba in which the Supreme Court, albeit at the jurisdictional level, held “the situs or location of shares and of any equitable interest in them is the jurisdiction where the company is incorporated or the shares are registered”. [89]:

It would follow that, insofar as relevant, questions of title to the Exillon shares, whose proceeds (a) were used to purchase the Properties and (b) remain in the form of the £72 million in the BJB account in Switzerland, would be likely to be governed by Manx law, Exillon having been incorporated in the Isle of Man.  A possible alternative would be English law on the basis that the shares were traded on the London Stock Exchange.  The parties have in any event agreed that, so far as relevant to these claims, Manx law is the same as English law.

[91] some role for Kazakh law is suggested to still exist when considering whether the English law preconditions for a tracing claim are met.  ‘It is generally a pre-condition of tracing in equity that there be a fiduciary relationship which calls the equitable jurisdiction into being’. [92] The law applicable to a cause of action or issue determines whether a person is required to hold property on constructive or resulting trust, hence it is necessary to consider whether duties imposed by the relevant foreign law are to be regarded as fiduciary.

Only in an afterthought [94] does the judge consider the lex causae governing unjust enrichment, equitable claims and negotiorum gestio, per Rome II as retained in UK law (and in Dicey). [The judgment is not in fact clear on when the claim was introduced and therefore might be subject to acquired as opposed to retained EU law].

The lex causae for the qualification of the current claims (proprietary restitution) as one of these entries in Rome II [96] is matter of factly presented as English law. [99] the judge dismisses the relevance of the succinct Rome II analysis for, harking back to his first reference to Dicey, the fundamental nature of the Claimants’ claim in the present case is held to be a proprietary one hence Dicey’s lex situs rule is said to apply without a need to consider Rome II.

Surely the right order is to qualify the claim, using autonomous EU interpretation, under (retained) Rome I cq Rome II and with reference to CJEU authority- with of course some of the recent qualification issues following CJEU Hrvatske Sume thrown in. Subsequently to only consider the English common law to the extent statutorily retained EU law does not govern the issue. The approach in the judgment is unsatisfactory and in that respect joins Fetch.AI Lrd & Anor v Persons Unknown Category A & Ors [2021] EWHC 2254 (Comm) , which Amy Held and Matthias Lehmann discuss critically this morning.

Geert.

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The applicable law for design infringement. Szpunar AG in Acacia v BMW.

First Advocate-General Szpunar opined a the end of October in C-421/20 on the law applicable to a damages suit following infringement of Community Design rights. No English edition of the Opinion is as yet available.

The two parties had earlier been at loggerheads on the jurisdictional issues, see CJEU C-433/16 BMW v Acacia and the provisional measures implications of the relevant Regulation 6/2002  were discussed in Spin Master. Current case not only puts into the spotlight the ‘international’ dimension required to trigger EU conflict of laws (it is in this section that I was pleased to see the AG refer to the 2016 ed of the Handbook), it also discussed the relationship between the core EU Regulations Brussels Ia, Rome I and II on the one hand, and lex specialis on the other, in the case at issue: A82(5) Regulation 6/2002: ‘5. Proceedings in respect of the actions and claims referred to in Article 81(a) and (d) may also be brought in the courts of the Member State in which the act of infringement has been committed or threatened.’ The result of the jurisdictional provisions is a cascade system which is also present in the relevant Trademark Regulation, prompting the AG to seek inspiration in CJEU AMS Neve.

BMW’s action, which was granted by the first instance German courts, seeks not just inductive relief viz Acacia’s distribution of wheel rims in Germany, but also damages for the alleged Community design infringement and (with a view to supporting the damages claim), access to documents, accounts etc. – this will have an immediate echo to readers of the blog I assume of ‘procedural’ issues to which I (and the AG) return below.

A relevant provision in the Community Design Regulation – CDR is Article 88, Applicable law:

1. The Community design courts shall apply the provisions of this Regulation.

2. On all matters not covered by this Regulation, a Community design court shall apply its national law, including its private international law.

3. Unless otherwise provided in this Regulation, a Community design court shall apply the rules of procedure governing the same type of action relating to a national design right in the Member State where it is situated.

A similar reference to national law with renvoi, is present in A89 with respect to ‘sanctions in actions for infringement’. With the inclusion of renvoi (‘a Community design court shall apply its national law, including its private international law’) inevitably reference is made to Rome II for that Regulation forms the applicable private international law in the Member States.

A first question was whether BMW’s requests re access to documentation, may be subject to lex fori processualis – answered in the negative by the AG with reference to CJEU C‑479/12 H. Gautzsch Großhandel , and to CJEU Nintendo. Whether these observations (and authorities) on the procedural issues extends to Rome I /II is not discussed. Readers will be aware that I find that an important question that remains outstanding.

The next issue is whether Rome II and /or the CDR apply at all to the litigation at issue in view of the light ‘international’ touch to the case. In view inter alia of the AG’s own Opinion in Vinyls Italia, he answers in the affirmative. For more detail on the issue please refer to the Opinion however I find among others his point convincing (43) that a restrictive view within the Community Design (and other intellectual property rights litigation) sphere, would hand a means to claimants artificially to split their claims so as to shop for the lex fori in Mozaik fashion. He rejects BMW’s alternative view based on the effet utile of A82(5) CDR. 

Up next is the question whether, having established Rome II applies, A8(2) Rome II needs to be applied using AMS Neve or alternatively Nintendo, to determine the ‘country in which the act of infringement was committed’. There is much detail on this in the Opinion (readers may refer to Annette Kur’s paper which also discussed this and is referred to in the Opinion), with the AG I think opting for the Nintendo route – I am not too proud to admit as I have done before, that the specific relation between secondary IPR law and EU conflict of laws, is not my specialty.

Geert.

 

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Sánchez-Bordona AG in ZK v BMA on applicable law for the Peeters Gatzen insolvency suit. Includes important suggestions for the corporate life (lex societatis) exception and duty of care.

Sánchez-Bordona AG opined at the end of October on the law applicable to the Peeters /Gatzen suit (of Nk v BNP Paribas fame) in Case C‑498/20 ZK, in his capacity of successor to JM, insolvency practitioner in the insolvency of BMA Nederland BV v BMA Braunschweigische Maschinenbauanstalt AG – ZK v BMA for short. An English version of the Opinion is still not available.

Peeters /Gatzen is a tortious suit brought by a liquidator. In Nk v BNP Paribas the CJEU held it is covered by Brussels Ia, not by the Insolvency Regulation. The obvious applicable law port of call is Rome II. A first point which the AG reviews is a rather important discussion on the lex societatis exception to Rome II. The extent of that exception is important e.g. also for business and human rights cases, for the Peeters /Gatzen suit essentially engages duty of care towards third parties.

The AG emphasises (35) one of my points of attention in the BIa /Rome I/II interplay: that in accepting a certain amount of consistency in interpretation, the courts must nevertheless appreciate each instrument’s autonomy and quite different subject-matter. (46) The reasoning behind the exclusion of the lex societatis from the 1980 Rome Convention is said to be the ambition at the time to harmonise company law across the EU which, as we know from CJEU Daily Mail and all its successors, has still not come true. The AG then refers to the internal /external dimension of corporate relations such as discussed in C‑25/18 Kerr and C‑272/18 Verein für Konsumenteninformation. However he then suggests (51) that the reference to the ‘internal’ dimension of the life of a corporation does not suffice to justify 2 of the examples which Rome II explicitly lists in A1(2)d as being part of the corporate exception: the personal liability of officers and members as such for the obligations of the company or body and the personal liability of auditors to a company or to its members in the statutory audits of accounting documents.

At (52-53) he then posits his way out of the conundrum, immediately acknowledging that the criterion he suggests may not be easily applicable: all contractual and non-contractual elements for which a specific solution exists which emanates from the relationship between those elements and the internal life and mechanisms of a corporation (whether they relate to the internal workings or the external relations), are covered by one statutory corpus, namely the lex societatis. Put differently, they are excluded insofar as and because their corporate law element absorbs all other. Specifically viz non-contractual obligations, if the relevant rule is so ‘drenched’ with elements specific to the corporate law context that it looses its meaning outside that context, that rule qualifies as being part of the lex societatis exception.

He immediately acknowledges (56) that this kind of litmus test is not easy to apply in practice and suggest (57 ff) to employ the ratio legis of the liability at stake to assist with the exercise. If that ratio lies in the general neminem laedere rule, Rome II is engaged. If that ratio however immediately follows from corporate law considerations, such as a director’s loyalty to the corporation, the exception is engaged. The AG lists examples (63), including the scenario at stake in CJEU OFAB. At (66) the AG concludes, albeit not directly, that the Peeters Gatzen suit in all likelihood is not covered by Rome II and he discusses the other questions in subsidiary fashion.

(67ff) with reference ia to CJEU Lazar the CJEU refers to the tricky characterisation of damage as (in)direct and opts in cases such as these that the direct damage occurs in the insolvent (or otherwise facing liquidity issues) corporation: the diminishing impact on the creditors is indirect, ricochet. Locus damni therefore is The Netherlands if the referring judge finds that the insolvent corporation’s estate is based there. (76) Whomever initiates the suit (the insolvency practitioner and /or the creditors) is irrelevant, as is (80) the fact that some of the creditors are located outside the EU.

(83ff) then follows the discussion of A4(3) Rome II’s escape clause (most recently discussed in Scott v AIG). A pre-existing contractual relationship (which the AG suggests (95ff) may also be called upon by claimants that are not party to that relationship) is just one among many factors that may play a role – not a particularly dominant one: (93-94) particularly where such relationship (such as here, taking the form of a credit facility) is one where choice of law was made: A4(3) RII is directed at situations where the non-contractual relationship has a closer connection to a law other than the locus damni. Lex voluntatis does not necessarily reflect the tort’s closer relationship but rather the parties’ voluntary expression.

An important Opinion.

Geert.

EU Private International Law, 3rd ed 2021, para 4.22.,  para 4.39 ff.

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Forever chemicals, and suing 3M for PFAS pollution in Europe. A flag on applicable law.

Update autumn 2022 my article on A7 Rome II has now been published: Lex ecologia. On applicable law for environmental pollution, a pinnacle of business and human rights as well as climate change litigation.

On Friday, together with my learned colleague at both Bar and Faculty Isabelle Larmuseau, I was asked to put my environmental law hat on at the Flemish Parliament. I was heard  on the current scandal hitting Flanders following PFAS (‘forever chemicals’) emissions by 3 M at the port of Antwerp. For background to PFAS see here.

Isabelle’s slidedeck for same is here (updated at 09:28 on 31 August to correct earlier pdf which contained an earlier version of the slides), and mine here. Both are in Dutch, with Isabelle’s focusing on the Flemish environmental law angle (albeit with strong EU law influence, necessarily) and mine on the EU and international law context).

Focus of the debate is on environmental /public health law however for my conflicts followers there is a treat. A civil law suit by Belgian and /or other [the port of Antwerp is very close for instance to the Dutch border. Emissions in air, water and soil (for the latter, particularly if exported) clearly impact Dutch citisens, say] claimants against 3M’s Belgian corporate presence is easily pursued both in Belgium (Article 4 Brussels Ia) and in other Member States (Article 7(2) locus damni). Residual private international law in all these States would fairly straightforwardly allow for the suit to be extended to 3M’s corporate mother, based at St Paul, Minnesota.

The more exciting bit is applicable law. The impact of common US (State) law on forever chemicals suits is well documented. Despite EU courts not willing to apply the punitive damages elements of these suits, an application of the other elements of US tort law may well be very attractive to claimants here. Those US laws are certainly within reach of claimants, using Article 7 Rome II. There is no question the damage ‘arises out of’ environmental damage (unlike the hesitation in Begum v Maran). There is certainly merit in the suggestion that locus delicti commissi is in St Paul, Minessota. Like with its fellow manufacturers and industrial users of PFAS, 3M’s worldwide grip on corporate communication and legal strategy on the issue is tight. More importantly, the decision tree on the manufacture, use and emissions of PFAS is arguably equally located at holding level. Reference here can be made to the relevance of Shell’s holding policy in lex causae determination in the recent climate ruling.

Clearly, via A17 Rome II, Flemish and of course European environmental law would play a role (cue Isabelle’s slidedeck for an excellent starter).

A collective action procedure in say The Netherlands in my view would be an ideal strategy to test these most murky waters.

Geert.

EU Private International Law, 3rd. ed. 2021, Chapter 4, Heading 4.6.3 (4.54 ff).

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Applicable law in cases of purely economic loss following judgment in Vereniging van Effectenbezitters.

I have reported before on the jurisdictional consequences of CJEU Vereniging van Effectenbezitters v BP. In this post for the European Association of Private International Law, I give my views on the impact for applicable law.

Geert.

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