Posts Tagged Article 6
It does not happen all that often: this is a call for assistance. Following a student’s Q re ‘habitual residence’ in Rome I, I have now noticed something I had not before (I more often than not use the English version of the Regulation in my teaching and practice): Article 6(1) on ‘consumer contracts’ uses the term ‘habitual residence’ ‘gewone verblijfplaats’ (defined, or not, for natural persons, in Article 19) in the introductory para (which identifies applicable law). However in littera a it then uses ‘domicile’ ‘woonplaats’: a term which is not otherwise used in Rome I and which is not defined by it.
A quick scan of other language versions (French, English, German) reveals no such error: they all use the equivalent of ‘habitual residence’ in both instances. Now, evidently the error must be pushed aside given the other language versions however: is any reader of the blog aware of a corrigendum ever published? For if it has, I cannot locate it.
(Handbook of ) European Private International Law, 2nd ed. 2016, Chapter 3, Heading 3.2.5.
Others have reported in some detail, and I am happy to refer, on Arlewin v Sweden at the ECtHR – the second Strasbourg conflicts ruling I report on in more or less one week. Epra have a short and sweet review, based mostly on the Court’s press release but useful nevertheless: they for instance suggest that Strasbourg have extended e-Date Advertising’s centre of interests rule for infringement of personality rights via the internet, to transmission by satellite. Dirk Voorhoof takes the media regulation angle. Dr Takis has the most extensive review over at Profs Peers and Barnard’s EU law analysis.
The case is a good illustration of an important port of entry for the ECHR into EU conflicts law in commercial litigation at least (I am not talking here of family law): Article 6’s right to fair trial. (See here for more extensive review of the Convention’s impact on European private international law). Strasbourg and Luxemburg are playing combination football here: the ECtHR approving of the CJEU’s application of the Brussels I Regulation in the case of libel and defamation. Especially with the EC’s recent shift of focus to the plaintiff’s position rather than the defendant’s, nothing guarantees of course that in the future EU law at this point might not be at odds with human rights law.
(Handbook of) EU private international law, 2nd ed, 2016, Chapter 2, Heading 184.108.40.206.4 .
Refusal of recognition for failure to serve. ECtHR tests the Brussels regime against Strasbourg in AVOTIŅŠ v Latvia
In AVOTIŅŠ v Latvia |Avotins v LAtvia, the Grand Chamber of the ECtHR at Strasbourg held late May that Article 6 ECHR (right to fair trial) was engaged but not infringed by the Latvian’s Supreme Court’s application of Article 34(2( Brussel I (now Article 45(1) b Brussels I Recast).
The Article reads ‘A judgment shall not be recognised: (…) 2. where it was given in default of appearance, if the defendant was not served with the document which instituted the proceedings or with an equivalent document in sufficient time and in such a way as to enable him to arrange for his defence, unless the defendant failed to commence proceedings to challenge the judgment when it was possible for him to do so;…
In the case at issue applicant sought refusal by the Latvian court of recognition of a Cypriot judgment issued against him. After review of the Regulation’s core pedigree of mutual recognition and mutual trust, burden of proof particularly exercised the Court: at 121:
‘The fact that the applicant relied on that Article (34(2), GAVC) without having challenged the judgment as required necessarily raised the question of the availability of that legal remedy in Cyprus in the circumstances of the present case. In such a situation the Senate was not entitled simply to criticise the applicant, as it did in its judgment of 31 January 2007, for not appealing against the judgment concerned, and to remain silent on the issue of the burden of proof with regard to the existence and availability of a remedy in the State of origin; Article 6 § 1 of the Convention, like Article 34(2) in fine of the Brussels I Regulation, required it to verify that this condition was satisfied, in the absence of which it could not refuse to examine the applicant’s complaint. The Court considers that the determination of the burden of proof, which, as the European Commission stressed (see paragraph 92 above), is not governed by European Union law, was therefore decisive in the present case. Hence, that point should have been examined in adversarial proceedings leading to reasoned findings. However, the Supreme Court tacitly presumed either that the burden of proof lay with the defendant or that such a remedy had in fact been available to the applicant. This approach, which reflects a literal and automatic application of Article 34(2) of the Brussels I Regulation, could in theory lead to a finding that the protection afforded was manifestly deficient such that the presumption of equivalent protection of the rights of the defence guaranteed by Article 6 § 1 is rebutted. Nevertheless, in the specific circumstances of the present application the Court does not consider this to be the case, although this shortcoming is regrettable.’
Those ‘specific circumstances’ include in particular the applicant’s professional background: at 124:
‘the applicant, who was an investment consultant, should have been aware of the legal consequences of the acknowledgment of debt deed which he had signed. That deed was governed by Cypriot law, concerned a sum of money borrowed by the applicant from a Cypriot company and contained a clause conferring jurisdiction on the Cypriot courts. Accordingly, the applicant should have ensured that he was familiar with the manner in which possible proceedings would be conducted before the Cypriot courts (…). Having omitted to obtain information on the subject he contributed to a large extent, as a result of his inaction and lack of diligence, to bringing about the situation of which he complained before the Court and which he could have prevented so as to avoid incurring any damage’.
I am not convinced by the Court’s view on the burden of proof and on the national court’s duty to assess the law in the State of origin sua sponte. Judges Lemmens and Briede, jointly concurring but for different reasons as the court, in my view have the better argument where they say
‘If the applicant wanted to argue that no remedy had in fact been available to him in Cyprus, in our opinion it would have been for him to raise this issue explicitly before the Supreme Court. We question whether he could expect the Supreme Court to raise that issue of its own motion. And we definitely consider that he cannot complain under Article 6 § 1 of the Convention about the lack of an explicit response to an argument that was not explicitly made.’
The end result is the same at the ECtHR. For future application of the Brussels I (Recast) Regulation however it makes a big difference.
(Handbook of) European Private International Law, 2nd ed. 2016, Chapter 2, Heading 2.2.16, Heading 220.127.116.11.4 (p.198).
Don’t leave the store without asking. Joinders, and the Aldi principle applied in Otkritie. On the shopping list for the EU?
Postscript 21 November 2017: For an application in Hong Kong see Far Wealth Ltd v Lo Ki Mou, reported here: proceedings dismissed as an abuse of process because the plaintiffs could have protected their position by way of a counterclaim in prior proceedings commenced against them by the defendants.
A posting out off the box here, so bear with me. Neither Brussels I nor the Recast include many requirements with respect to (now) Article 8(1)’s rule on joinders. A case against a defendant, not domiciled in the court’s jurisdiction, may be joined with that against a defendant who is so domiciled, if the cases are ‘so closely connected that it is expedient to hear and determine them together in order to avoid the risk of irreconcilable judgments’. There is of course CJEU case-law on what ‘so closely connected’ means however that is outside the remit of current posting.
As I reported recently, the CJEU has introduced a limited window of abuse of process viz Article 8(1), in CDC. The Court’s overall approach to Article 8(1) is not to take into account the subjective intentions of plaintiff, who often identify a suitable anchor defendant even if is not the intended target of their action. The Court does make exception for one particular occasion, namely if it is found that, at the time the proceedings were instituted, the applicant and that defendant had colluded to artificially fulfil, or prolong the fulfilment of, (now) Article 8’s applicability.
What if at the time the proceedings were instituted, applicant artificially ignores the fulfilment of, (now) Article 8’s applicability?
The Aldi rule of the courts of England and Wales, and its recent application in Otkritie, made me ponder whether there is merit in suggesting that the CJEU should interpret Article 8(1) to include an obligation, rather than a mere possibility, to join closely connected cases. I haven’t gotten much further than pondering, for there are undoubtedly important complications.
First, a quick look at the Aldi rule, in which the Court of Appeal considered application of the Johnson v Gore Wood principles on abuse of process of the (then) House of Lords, to an attempt to strike out a claim for abuse of process on the basis that the claim could and should have been brought in previous litigation. Aldi concerned complex commercial litigation, as does Otkritie. The result of Aldi is that plaintiffs need to consult with the court in case management, to ensure that related claims are brough in one go. Evidently, the courts need to walk a fine rope for the starting point must be that plaintiffs have wide discretion in deciding where and when to bring a claim: that would seem inherent in Article 6 ECHR’s right to a fair trial.
In Otkritie [the case nota bene does not involve the Brussels Regulation], Knowles J strikes the right balance in holding that the Aldi requirement of discussing with the court had been breached (and would have cost implications for Otkritie in current proceedings) but that otherwise this breach did not amount to abuse of process.
Now, transporting this to the EU level: to what degree could /should Article 8 include a duty to join closely related proceedings? Should such duty be imposed only on plaintiff or also on the court, proprio motu? A crazy thought perhaps for the time being, but certainly worthwhile pondering for future conflicts entertainment.
It’s not the grammar, stupid! The High Court in Anchorage on exclusive (or not) choice of court, anti-suit injunctions, Rome, Brussels and much more
In Anchorage (BNP Paribas v Anchorage Capital Europe et al). a bank and a hedge fund are at odds as to whether a handful of instant message communications resulted in a binding contract or contracts and if so, between which parties and on what terms. The issue for decision at the High Court was whether the disputes should be determined in London (home to the London Branch of BNP Paribas and allegedly identified as the exclusive – or not – court of choice in the alleged contracts), New York (home to the hedge fund which however also has a separate LLP domiciled in London) or possibly Luxembourg (home to two funds within Anchorage Group).
For review of the facts reference is best made to the text of the judgment, for there are many framework agreements etc at stake. The High Court’s review of the case though is most interesting for highlighting the limits to what Article 23 of the Brussels I Regulation harmonises. The Article aims to ensure a non-formalistic deference to parties’ agreement to have their disputes adjudicated in a particular court. As Males J notes (and the ECJ acknowledges), one should not be overly formalistic in applying Article 23.
Article 23 though does not harmonise the underlying contractual (or not) issues: with whom were contracts made, especially in an agent /principal context; what law applies to the (alleged) choice of court agreement (an issue more or less resolved in the new Brussels I Regulation). Males J applies English law to the issue of validity of the clause, on the basis it would seem of lex contractus (which arguably will no longer be possible come January 2015, as a result of the new Brussels I Regulation): either because of the express determination of such by the parties, or because the lex contractus of the agreement of which it forms part is English law by virtue of the Rome I Regulation (contract for the sale of goods; I am not sure though whether the underlying contract truly is a sale of a good). Arguments for the alternative (in particular, application of New York law to the choice of court agreement) are dismissed on the basis that they represent the kind of semantic approach to such clauses which English law has left firmly behind. Surely a poster-argument indeed for the use of English law in international commerce and an approach which is to be commended.
Even were the validity of the clause not to be upheld, the High Court outlines other jurisdictional grounds: Article 5(1) of the Jurisdiction Regulation on the basis of the place of performance of the obligation in question; Article 5(5) on the basis of a contractual dispute closely connected to the operation of a branch; Article 6(1) on the basis of the cases being closely connected. (Use of Anchorage London as an anchor defendant (lousy pun intended I fear) against the investment funds).
Forum non conveniens (potentially applicable should none of the jurisdictional grounds be valid and given the possibility of New York proceedings) was dismissed; the anti-suit injunction was granted. Here, Males J reviews the rather grammatical arguments made vis-a-vis the choice of court agreement being used transitively or not: again, the Court takes a non-formalistic approach and (respectfully) dismisses the grammatical argument as being elusive.
This is the kind of case upon which one could build an entire conflicts course. If you happen to be preparing one over the holidays period: good luck and enjoy. To all readers past, current and future: Merry Christmas and /or applicable and appropriate season’s greetings. Geert.