G I Globinvestment. A jurisdiction finding with core shortfalls on Brussels Ia.

In G I Globinvestment Ltd & Ors v VP Fund Solutions (Luxembourg) SA & Ors [2022] EWHC 1872 (Comm) wealthy Italian investors seek to recover losses which they suffered when investments they had made plummeted in value at the outset of the COVID pandemic. Defendants are in various jurisdictions. Most have accepted jurisdiction, two of them, one based in Luxembourg, the other in Liechtenstein, challenge jurisdiction.

The claim against the Liechtenstein defendant is subject to common law rules, the country not being a party to Lugano. I will leave that further undiscussed here, suffice to say the challenge was unsuccessful.

The claim against the Luxembourg based defendant was issued before Brexit implementation date and subject to Brussels Ia. It claims there is an A25 exclusive choice of court clause in the investment fund’s general subscription terms, and Vineall DJ discusses it with reference to the general A25 outline in PIFSS v Piqtet.

Parties are agreed [64] – wrongly, nota bene, that on formal validity, the question is whether there has been an actual consensus between the parties, clearly and precisely demonstrated, and on material validity, the question is whether the dispute between the parties arose or originated from the particular legal relationship in connection with which the clause was concluded. That is the kind of agreement which would see my students fail a Brussels Ia question.

[65] a further major error is made with the parties seemingly agreeing that ‘whether the claim falls within the scope of the [clause], that question is to be answered according to Luxembourg law’.

The conclusions are [88] that there is no [forum clause] in the in the Subscription Agreement, although there is choice of law clause; 88.2. There is no EJC in the Offering Document; The Offering Document wrongly asserts that there is a jurisdiction clause in the Subscription Agreement; That is insufficient to establish a clearly and precisely demonstrated consensus; no consensus as to jurisdiction is demonstrated: the result of the conflicting documents is a muddle; therefore there is no exclusive jurisdiction clause on which VP Lux can rely.

I have not got the kind of access to the file to say the outcome is factually wrong – the route to it certainly is and simply wrong in law.

The judge also [89] concludes that whether one of the claimants is a consumer who can sue in England and Wales need not be decided:  ‘That issue does not seem to me to be entirely straightforward and since it is not necessary to resolve it in the light of my conclusions about [choice of court] I prefer not to decide it’: why not?: VP Lux contest jurisdiction and it is the judge’s task under Brussels Ia to assess the existence of jurisdiction on any of the Brussels Ia grounds.

Had the judgment been issued in exam season it would have been obvious material for ‘spot the Brussels Ia errors’.

Geert.

 

Some pondering on EU reception of Celsius’ GTC choice of court and -law.

When prof Bookman asked my input on Celsius’ choice of court and governing law’s clause in its GTCs, I was otherwise engaged. Subsequently I waited with an answer for I used the issue for an exam question. – so here is my primer.

Celsius are one of the leading crypto currencies exchanges (future readers may not be familiar: crypto currencies were an early 21st century Ponzi scheme).

The question I put to the students, was:  A fellow academic and practitioner from the US asks you how clause 33 of the standard Celsius contract, copied below, would be received in the EU. Celsius are one of the world’s leading crypto currencies exchanges.

How do you respond to this question? Argue with reference inter alia to relevant CJEU case-law.

Students had two pages to answer. I did not specify Celsius’ domicile. This is what I expect to be included in the reply. Both for jurisdiction and for there is a clear distinction between the B2B and B2C scenario.

Re: B2C: For the contract to be a true ‘consumer’ contract within the meaning of Brussels Ia, Celsius would have had to target their activities at the consumer’s Member State etc.: CJEU Peil and Reliantco are good pointers, as are Ramona Ang and Khalifeh v Blom Bank. Whether Celsius are domiciled in the EU is of no consequence for the consumer section to be engaged. At the jurisdictional level, the choice of court clause would have no consequence (A19 BIa), and the consumer would be able to sue Celsius either in the consumer’s EU domicile, or in Celsius’ EU domicile if it has one. Celsius would only be able to sue in the consumer’s domicile. Articles 33-34 BIa lis pendens rules would not be engaged.

At the applicable law level, the choice for New York law would stand, however mandatory law of the consumer’s habitual residence (which would include transposition of EU consumer law) would trump any conflicting provisions (A6(1) and (2) Rome I).

Re: B2B or indeed a B2C contract which does not trigger the consumer section, the picture would be quite different. Here, whether Celsius as contracting partner has a domicile in the EU, does matter.

If there is such domicile, then at the level of jurisdictionthe EU based party is likely to seize the A4 domicile court, potentially also seeking out a forum contractus if the currency services were to be provided elsewhere than in the place of Celsius’ domicile. That is where Celsius, had it seized an ex-EU court first, then might seek application of A33-34. For this it may come to regret having included hybrid choice of court: recital 24(2)’s reference to the ex-EU court having exclusive jurisdiction arguably does not apply to hybrid choice of court.

Were Celsius to sue the other party in an EU court first (taking ‘any applicable jurisdiction’ at its face value and understanding it as including EU courts), the other party is likely to raise the invalidity of the hybrid choice of court. This is where BIa knickers will get into their proverbial twist: for recital 20’s lex fori prorogati’s instruction as lex casae for the validity of the clause, only refers to ‘a court or courts of a Member State’. Celsius could of course chose to ignore choice of court (implicitly accepting its invalidity) and seize the A4 court of the EU counterparty.

At the level of applicable law, choice for New York law will in any case stand in this scenario, with however A3(4) Rome I’s rule for ‘purely EU’ contracts kicking in, and potentially Article 9 Rome I’s lois de police.

If there is no EU Celsius domicile, Celsius is unlikely to sue in the EU (for it risks having an EU court apply EU banking, finance etc law as mandatory law) however if it does, it would either do so on the basis of A4 domicile jurisdiction, or invoking, as above, the ‘any applicable jurisdiction’ instruction in the hybrid choice of court. Only A9 Rome I could then marginally upset choice of NY law.

Finally, assuming Celsius were to sue the consumer outside the EU, and were to seek enforcement of the judgment in an EU Member State, this would engage the Member States’ residual rules on recognition and enforcement.

Quite a set of variables in the end, and I would be much happy to hear others’ thoughts.

Marking me will look out for core B2B /B2C and domicile considerations.

Geert.

 

 

Tilman v Unilever. A preliminary reference on flag-wrap B2B choice of court under Lugano.

A puzzling title perhaps I agree but let me explain. Thank you Matthias Storme for alerting me to the May 2021 preliminary reference by the Belgian Supreme Court, a reference now known at the CJEU as Case C-358/21 Tilman SA (of Belgium) v Unilever Supply Chain Company AG (of Switserland). Elucidation is asked of Article 23 of the Lugano 2007 Convention, the choice of court provision in the Convention.

The question referred, reads

Are the requirements under Article 23(1)(a) and (2) of [Lugano 2007], satisfied where a clause conferring jurisdiction is contained in general terms and conditions to which a contract concluded in writing refers by providing the hypertext link to a website, access to which allows those general terms and conditions to be viewed, downloaded and printed, without the party against whom that clause is enforced having been asked to accept those general terms and conditions by ticking a box on that website?

Article 23 Lugano 2007 is identical (mutatis mutandis: the only difference being that A23 Lugano refers to ‘States to the Convention’ instead of ‘Member States’) to the former Article 23 of the Brussels I Regulation, Regulation 44/2001.  A23 Lugano 2007 reads in relevant part

    1. If the parties, one or more of whom is domiciled in a State bound by this Convention, have agreed that a court or the courts of a State bound by this Convention are to have jurisdiction to settle any disputes which have arisen or which may arise in connection with a particular legal relationship, that court or those courts shall have jurisdiction. Such jurisdiction shall be exclusive unless the parties have agreed otherwise. Such an agreement conferring jurisdiction shall be either: (a) in writing or evidenced in writing; or (b) in a form which accords with practices which the parties have established between themselves; or (c) in international trade or commerce, in a form which accords with a usage of which the parties are or ought to have been aware and which in such trade or commerce is widely known to, and regularly observed by, parties to contracts of the type involved in the particular trade or commerce concerned.
    2. Any communication by electronic means which provides a durable record of the agreement shall be equivalent to ‘writing’.

The case at issue therefore does not question so-called ‘click-wrap’ consent to general terms and conditions – GTCs. These require the contracting partner to tick the relevant box which then ‘wraps up’ the agreement, including choice of court (and law). They were the subject of CJEU El Majdoub v CarsOnTheWeb. In that judgment, the CJEU held that in a B2B context, where the GTCs that have to be ticked can be saved and printed, they can be a ‘durable’ record of consent. (Not: consent itself: that is subject to a separate analysis, under the relevant lex causae, see below).

Rather, the title of this post calls the issue one of ‘flag-wrap’: one of the parties’ (Unilever’s) GTCs  are contained on a website, and their existence is ‘flagged’ in the written main contract. Does that suffice to bind the parties as to the GTC’s choice of court (in favour of the English courts; note the courts were seized pre-Brexit; the UK’s Lugano troubles are not engaged)?

The provisions on forum clauses are drafted in a way ‘not to impede commercial practice, yet at the same time to cancel out the effects of clauses in contracts which might go unread’ (Jenard Report), or otherwise ‘unnoticed’ (CJEU Colzani). The Brussels Convention and now the Regulation show great support for choice of court agreements and aim not to be as overly formalistic as the conditions imposed upon them.

Importantly, valid choice of court does require both a clearly and precisely demonstrated consent to be bound by choice of court and one or another Article 25-sanctioned form of expression of that consent. In Colzani the CJEU held [7]:

the requirements set out in Article [25] governing the validity of clauses conferring jurisdiction must be strictly construed. By making such validity subject to the existence of an ‘agreement’ between the parties, Article [25] imposed upon the court before which the matter is brought the duty of examining, first, whether the clause conferring jurisdiction upon it was in fact the subject of a consensus between the parties, which must be clearly and precisely demonstrated. The purpose of the formal requirements imposed by Article [25] is to ensure that the consensus between the parties is in fact established.

CJEU authority of Colzani and Coreck Maritime impose on the court the duty of examining ‘whether the clause conferring jurisdiction upon it was in fact the subject of a consensus between the parties’ and this had to be ‘clearly and precisely demonstrated’.

In practice, many courts conflate the check for consent with the check for expression of that consent and even the CJEU is not always clear in distinguishing it. In particular, absence of proof of any of the three possible avenues for expression of consent, included in Article 25(1) a, b or c, or then taken as an absence of consent, full stop. In Colzani, the CJEU held

[T]he mere fact that a clause conferring jurisdiction is printed among the general conditions of one of the parties on the reverse of a contract drawn up on the commercial paper of that party does not of itself satisfy the requirements of Article 17, since no guarantee is thereby given that the other party has really consented to the clause waiving the normal rules of jurisdiction. Where a clause conferring jurisdiction is included among the general conditions of sale of one of the parties, printed on the back of a contract, the requirement of a writing under the first paragraph of Article 17 of the Convention is fulfilled only if the contract signed by both parties contains an express reference to those general conditions.

The CJEU here, wrongly, seems to suggest lack of compliance with the expression of consent indicates a lack of that consent full stop.

Importantly, the CJEU in its rulings on what was then Article 23 and its Brussels Convention predecessor keeps utterly silent on national conditions relating to the actual formation or existence of consent. This, as regular readers of the blog will know, is at least for cases covered by Brussels Ia, subject to the lex fori prorogati, with renvoi, an issue which both national courts and the CJEU struggle with.

How then should the CJEU respond to the question (I asked my conflict of laws students at Leuven this question in a first exam on 18 June)?

Firstly, the Court should (and will) remind us of the Jenard /Colzani core instruction: the need to ensure consent is established, without being overly formalistic. Different from the context of the protected categories, there is no ‘weaker category’ to protect here.

Secondly,  there needs to be durability of the record of consent. That seems to be guaranteed here via the technicalities of the Unilever platform (downloadable GTCs) and in line with aforementioned CJEU Al Majdoub (the June students were not given technical details but should still flag durability).

Thirdly, despite the formal A23  requirement most probably being met, the consent requirement to me seems far from certain. In a click and wrap context ― lest there be issues of agency, duress, consumer protection laws etc. (in a context where the consumer title’s conditions are not met) which need to be held under the law applicable to consent ― the box ticking solidifies establishment of consent. In a mere flag and wrap context, that to me seems far less certain. If the reference were to a url where GTCs are properly and collectively displayed (if need be, updated with clear reference to chronology; see housekeeping), consent by an ordinary careful business (the proverbial (business)man on the Clapham omnibus). Yet if such as here, the link communicated in the formal contract refers to a platform where the  GTCs are not the first thing the contracting party sees, rather, where it is expected that that contracting party registers and /or downclicks, search and retrieve etc., that consent to me seems far less certainly established. [Again my students were not given the details on the platform which the reference includes, they did however have to signal the issue of consent).

Finally, under BIa, the lex fori prorogati, incl renvoi, would determine the above considerations of consent. Here, therefore, English law including its conflict of laws rules on choice of court. However seeing as the case is not subject to Brussels Ia, but rather to Lugano, the lex causae for consent will be an issue for the courts seized (here, the Belgian courts) to determine. Under the Belgian rules, this means application of Rome I (Rome I excludes choice of court agreements however Belgium’s private international law Act makes Rome I applicable even to carved-out contractual arrangements).

An interesting reference.

Geert.

EU Private International Law, 3rd ed. 2021, Heading 2.2.10.

 

(Rejected) appeal in PIFSS v Banque Pictet leads to renewed criticism of the intensity of jurisdictional litigation – as well as continuing uncertainty on anchor jurisdiction.

The appeal in The Public Institution for Social Security v Banque Pictet & Cie SA & Ors [2022] EWCA Civ 29 has been dismissed. I reviewed the first instance judgment here. I conclude that review writing ‘Those criticising the intensity of jurisdiction squabbles will find ammunition in this 497 para judgment.’ The Court of Appeal judgment is another 152 paras and as Andrew Dickinson also notes, Carr LJ, too, is critical: [12]

There will of course be cases where a novel and/or complex point of law needs to be debated fully and decided and, as foreshadowed above, this litigation raises some new, albeit relatively short, legal issues. Further, the sums involved are substantial and the allegations made are serious. However, these features did not create a licence to turn a jurisdictional dispute into an extensive and essentially self-standing piece of litigation. The costs incurred below ran to many, many millions of pounds: the interim payment orders in respect of the Respondents’ costs amounted to £6.88 million against a claimed total of some £13.5 million.

The issues on appeal are listed [41] ff and they of course reflect the discussion I summarised in my post on the first instance findings. I list them below and summarise the Court’s findings.

Article 23 formal requirements (involving Banque Pictet and Mr Bertherat only):

i) For the purposes of the requirement in Article 23(1)(a) that a jurisdiction agreement must be in or evidenced in writing, was the Judge right to conclude that it was unnecessary for the GBCs containing the EJCs (‘exclusive jurisdiction clauses, GAVC) actually to have been communicated to PIFSS?

ii) If so, was the Judge right to find that Banque Pictet did not have the better of the argument that the GBCs were communicated to PIFSS prior to 2012?

Lady Justice Carr is right in my view e.g. [67] that CJEU authority does not require material communication of GTCs etc which contain EJCs. Rather, the judge needs to establish ‘real consent’,  in the spirit of the Raport Jenard with a rejection of excessive formality.

Article 23 material validity (involving all Pictet and Mirabaud Respondents (save for Pictet Asia, Pictet Bahamas and, for the avoidance of doubt, also Mr Amouzegar and Mr Argand)):

i) Was the Judge right to conclude that the “particular legal relationship(s)” in connection with which the EJCs were entered into for the purpose of Article 23 was the totality of the legal relationships between the parties forming part of the banker/customer relationship between them?

ii) Was the Judge right to conclude that the relevant Respondents had the better of the argument that the disputes relating to (a) the Pictet/Mirabaud bribery claims; (b) the Pictet/Mirabaud accessory claims “ar[o]se out of” those “particular legal relationship(s)”?

The term ‘material validity’ is employed both in first instance and at the Court of Appeal although it is not quite correct; what is really meant is what Henshaw J called the ‘proximity’ requirement: which ‘disputes’ ‘relate to’ the matters covered by the EJCs? Here, Carr LJ sides eventually [98] with the judge mostly as a matter of factual analysis: neither CJEU Apple nor CDC require a restrictive approach where parties have formulated the EJC very widely. The judge carefully considered the wording of the clause and on contractual construction was right to find that the disputes at issue fell within it.

Scope of EJCs (as a matter of the relevant domestic law) (involving all Pictet and Mirabaud Respondents (save for Pictet Asia and Pictet Bahamas and again, for the avoidance of doubt, Mr Amouzegar and Mr Argand)):

i) Was the Judge right to find that PIFSS had the better of the argument that, on the true construction of the relevant EJCs, the disputes relating to the wider accessory claims fell outside the scope of the applicable EJCs?

ii) (Mr Mirabaud only): Was the Judge right to conclude that PIFSS had the better of the argument that claims against Mr Mirabaud relating to events after 1 January 2010 fell outside the scope of the relevant EJCs?

This issue relates to whether the EJCs, as a matter of construction under Swiss (or Luxembourg) law – which the judge had discussed obiter, did not extend to cover the wider accessory claims. [101]: in summary the relevant parties suggest that, having correctly recognised that what was alleged by PIFSS were unitary schemes arising out of continuing courses of conduct, the Judge was then wrong to conclude that they did not have the better of the argument that the wider accessory claims also fell within the EJCs.

Carr LJ deals rather swiftly with these discussions, again I feel finding mostly that the judge’s analysis was mostly factual (albeit seen from the viewpoint of Swiss and /or Luxembourg law) and not incorrect.

Article 6: (the number of Respondents to whom the Article 6 challenge is relevant will depend on the outcome of the appeals on the issues above, but on any view the issue of principle arises in relation to Mr Amouzegar and Mr Argand):

i) Was the Judge right to conclude that, for the purpose of Article 6, the Court was not required to consider solely the risk of irreconcilable judgments between the claim against the anchor defendant and the claim(s) against the proposed Article 6 defendant(s) but rather was permitted to consider other relevant circumstances including, in particular, the risk of irreconcilable judgments between the claims sought to be made against the proposed defendant and other claims in other member states?

ii) Did the Judge apply the test correctly in relation to each relevant Respondent?

This I find is the most important part of the judgment for it is in my view the one which most intensely deals with a point of law. Readers may want to refer to my earlier post for a summary of the A6 (Lugano) issues. The judge had found against A6 jurisdiction, also following Privatbank‘s ‘desirability’ approach. Parties upon appeal argue [110] that the Judge’s interpretation results in exclusive jurisdiction clauses having practical effects well beyond the scope of their application, with the collateral effect of conferring on them a “gravitational pull” which is inconsistent with the proper interpretation of A23 Lugano. PIFSS submits that it undermines the drive for legal certainty that motivates the strict approach to A6 identified in the authorities. They also suggested (in oral submission) that for A6 purposes only actual, and not merely potential, proceedings are properly to be taken into account. 

The CA however [112] confirms the relevance of future as well as extant claims and generally supports the flexible approach to A6. Carr J concedes [131] that this approach can be said to give “gravitational pull” to A23 and suggests ‘(t)here is nothing objectionable about that, given the respect to be accorded to party autonomy.’

I do not think this is correct. Including broadly construed ‘related’ claims in choice of court would seem to deny, rather than protect party autonomy: for if parties had really wanted to see them litigated in the choice of court venue, they ought to have contractually include them.

The issue of desirability per Privatbank is not discussed and therefore remains open (compare EuroEco Fuels).

Forum non conveniens: Pictet Asia and Pictet Bahamas:

i) Depending on the outcome of the issues above, was the Judge right to conclude that PIFSS had not shown that England was clearly the appropriate forum for the resolution of the claims against Pictet Asia and Pictet Bahamas?

Here the swift conclusion [143] is that the judge’s finding that PIFSS had not shown that England was clearly the proper forum is unimpeachable.

A lot is riding on this jurisdictional disagreement.  Permission to appeal to the Supreme Court was refused by the CA but may still be sought with the SC itself.

Geert.

EU Private International Law, 3rd ed. 2021, big chunks of Chapter 2.

 

Athena Capital Fund v Secretariat of State for the Holy See. Thank Heavens for jurisdictional mercies (here inter alia involving lex fori prorogati and agency for choice of court).

Athena Capital Fund Sicav-Fis SCA & Ors v Secretariat of State for the Holy See [2021] EWHC 3166 (Comm) features as defendant the Secretariat of State of the Holy See  (not the Holy See itself), and relates to a fraud and embezzlement claim of property in Chelsea, London.

Defendant says that from the perspective of Claimants, the purpose and intention of bringing these proceedings is to try to influence the criminal process in Italy, and/or the publicity emanating from the criminal process.

For its jurisdictional challenge, defendant argues [81] i) The claim was not a “civil and commercial matter” within the meaning of A1(1) BIa; ii) one of the claimants was not a party to the relevant Sale and Purchase Agreement (SPA) and could not rely upon it [this was summarily dealt with [88] by suggesting an amendment of claim] and, more forcefully, (iii) Defendant was not a party to the SPA for the purposes of A25 BIa.

Salzedo J justifiably in my view held [84] that

whether the claim is a civil or commercial matter does not turn on the subjective intentions of the claimant as to the ultimate effect that a claim might have on its interests, but on an objective reading of the claim itself and the relief that it seeks from the court. On that basis, it is a claim for declarations against the Defendant concerning the Defendant’s entry into commercial transactions with the Claimants.

and that the transaction was not entered into by the Defendant in the purported exercise of public powers: [86]

The Transaction was one that any private person could have entered into if it had the requisite funds. Nothing that was essential to the Transaction required sovereign powers to enter it and nothing that the Defendant did or purported to do was in the exercise of public authority.

As for the defendant not being a party to the SPA, the context here is whether a party involved in the signing accepted the SPA and its choice of court as an agent of the defendant. The judge, confirming the parties’ consensus, points out that that agency issue befalls to be addressed by English law. It is not said why that is the case however it is of course the result of the amended A25 – as others before it, however, the court does not complete the lex fori prorogati analysis with the recital 20 in fine mandated renvoi. On the agency issue the judge holds there is a good arguable case that the relevant agent did bind the defendant.

Next [103] ff follows a CPR-heavy discussion on the amendment of the claim form, seeing as the claimants erroneously assumed [120] that BIa was not engaged as the Vatican is not party to Brussels Ia. At [123] the conclusion is that the claim form may be amended and that defendants’ time spent in dealing with the service out issues under the common law (a wasted exercise as BIa applied), may be met in the costs order.

Once the A25 point rejected, there would have been a most narrow window for any kind of stay, yet the defendants try anyways, with [129] a series of abuse and case management arguments. One particularly poignant one is that the proceedings would interfere with a criminal proceeding. After discussion the judge [159] dismisses the idea on the facts, seeing as none of the declarations sought would involve any assertion as to what does or does not amount to criminality as a matter of the law of the Vatican State.

[163] ff discusses the abuse of process issue which the defendants, I understand, presented more or less as being integrated into the criminal procedure element, discussed above. That was wise, for abuse of process, while entertained among others in Vedanta, is arguably noli sequitur in a BIa claim. [Support for the alternative view here was sought [172ff] in Messier-Dowty v Sabena SA[2000] 1 WLR 2040]

The case-management stay proper is discussed 192 ff with reference ia to Municipio, and Mad Atelier. The judge in current case is very aware of not re-introducing through the back door what CJEU Owusu shut the front door on. He summarily discussed the possibility anyway, only to reject it. He does however eventually order a stay on the grounds that the current claim cannot usefully be pursued as long as the defendant is in a bind about the outcome of the criminal proceedings in Italy, and because the real adversary of the Claimants in relation to the Transaction is not the Defendant, but other organs of the Holy See or the Vatican State itself – the chances of those ever appearing in a civil proceeding in E&W are extremely slim. The claims were therefore held not to serve any useful purpose and where stayed on that basis, and for as long as a material change in circumstances might alter the finding of uselessness.

An interesting case.

Geert.

Consumer contracts, settlements and choice of court ‘after the dispute has arisen’. The Danish courts in Thomas Higgins v Saxo Bank.

I discussed settlement agreements viz Brussels Ia’s protected categories before, in particular in my review of Yukos v Merinson. Choice of court between consumers and employees one the one hand, and the business and employer on the other, is valid inter alia when the parties ‘enter into’ the (choice of court agreement) ‘after the dispute has arisen’. The assumption is that the consumer will have had an opportunity to consult lawyers and that therefore the inequality of arms has disappeared.

A dispute will have ‘arisen’ for the purposes of these Articles only if two conditions are satisfied: (a) the parties must have disagreed upon a specific point; and (b) legal proceedings in relation to that disagreement must be imminent or contemplated.

Many thanks to Henrik Gisløv who sent me copy of the judgment of the City Court and subsequently the High Court in Thomas Higgins v Saxo Bank. Henrik represented Mr Higgins and I have included Henrik’s English translation of the relevant sections of the High Court’s judgment below – I do not read Danish.

I understand from Henrik that Saxo Bank claimed an amount for “CFD financing charges” of EUR 230,000 accrued in less than one month. Mr Higgins, domiciled at Ireland, disputed the claim, and a settlement agreement was entered into. Mr Higgins had no legal advise when entering the settlement agreement – whether the actual, as opposed to assumed, benefit of legal advice is required for A10 to apply, is not discussed.

In the opinion of Mr Higgins the bank breached the terms of the settlement agreement, and he raised several complaints with the staff of the bank. These complaints went unanswered and Mr Higgins decided to terminate the settlement agreement: ‘Further to my email of Friday March 3rd, I confirm that the live price feeds have not been restored. Accordingly, our Contract is now void. Unless you wish to negotiate terms that address the contractual failings, the only option open to me is to reactivate my original Complaint and refer it for regulatory adjudication.’ This was in March 2017.

The bank then filed a case in the Danish courts, in January 2019 only. It argued  jurisdiction on the basis that a choice of court clause had been part of the  settlement agreement which Mr Higgins had terminated in March 2017. The City Court found first of all that Mr Higgins was a consumer (CJEU Petruchova comes to mind). Secondly, the City Court found that the dispute related to whether or not the terms of the settlement agreement had been breached or not. Therefore that the dispute that is being litigated had only arisen after that settlement agreement had been made and that the choice of court made in the settlement agreement was not a valid agreement after the dispute had arisen. The Eastern High court upon appeal however overturned the decision. Leave to appeal to the Supreme Court was rejected.

Of note in my view is that for there to be valid choice of court within the meaning of A19 BIa, legal proceedings in relation to that disagreement must be imminent or contemplated. From my admittedly half baked, Google translate assisted understanding of the judgments, this condition is not discussed in the judgments (it is clear, from the quote, in English, at the time of Mr Higgins’ cancellation of the agreement, legal proceedings are contemplated at that moment; yet the settlement with the choice of court agreement was formed much earlier). Rather, the High Court unconvincingly focuses on the synergy between the complaints under the original platform agreement and the nature of the subsequent complaints. This could have done with SC insight.

The judgment puts the spotlight on the nature of settlement agreements in the context of protected categories, and the stronger role consumer and employment law might have to play to ensure both the twin goal of settling disputes before they go to court, whilst at the same time not depriving the protected categories of their Regulation-sanctioned protection.

Geert.

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

 

____Henrik Gisløv translation of the High Court judgment in relevant part:___

It is undisputed before the High Court that the settlement agreement entered into between Thomas Martin Higgins and Saxo Bank A / S, is a consumer agreement in the sense of the term has applied the Judgment Regulation. Cases against consumers must, according to the Judgment Regulation Article 18, paragraph 2, as a starting point is brought before the courts in the Member State in which the consumer resides.

The main issue in this case is then whether the condition of the judgment Article 19 (1) to derogate from this starting point is met. According to the provision is it decisive whether the settlement agreement, including the agreement’s provision on venue, may be deemed to have been concluded after the dispute has arisen. If the condition is fulfilled, the venue agreement is binding on Thomas Martin Higgins.

It is assumed as undisputed that the settlement agreement of 11 July 2016 was entered into as a result of a disagreement as to whether Thomas Martin Higgins had obligation to pay the fees of 231,320 euros that Saxo Bank A / S had charged for the period from 1 to 29 April 2016.

It appears from clause 1 of the settlement agreement, that Thomas Martin Higgins should withdraw its complaint about the fees that Saxo Bank A / S should separate Thomas Martin Higgins’ two accounts and credit one account with one amount of 115,660 euros, corresponding to half of the fees charged. The other account then had a balance of -87,565.16 euros, which Thomas Martin Higgins undertook to pay to Saxo Bank A / S in 12 instalments.

Thomas Martin Higgins paid six instalments until February 2017, after which he by letter dated 6 March 2017, terminated the settlement agreement.

The question then is whether the lawsuit relates to the dispute that was tried resolved by the settlement agreement, or whether it relates to subsequent matters.

Thomas Martin Higgins has argued that Saxo Bank A / S on several points has breached the settlement agreement and that it is these breaches of agreement that are the background for the present case. He has during his explanation to the city court alone referred to the one concrete example that he during his continued trading on the bank’s platform continued to lose so-called live prices (real-time prices).

On the other hand, it is undisputed that Thomas Martin Higgins under the settlement agreement concluded continued to trade on the platform provided by Saxo Bank A / S available to him. Saxo Bank A / S has in accordance with the settlement agreement written down its fee claim to half, and the settlement agreement does not contain detailed terms for the continued trading on the platform, including on live prices.

In view of this and the fact that the amount of 41,297.28 euros that Saxo Bank A / S has withdrawn subpoena for, constitutes the difference between the amount paid by Thomas Martin Higgins had to pay after the settlement and the instalments paid of 45,412.41 euros plus the deposit on account 176283INET / DK4011490100705836, the High Court finds that the present dispute does not concern one which arose after the conclusion of the settlement agreement [and is a, GAVC] disagreement on the interpretation of the agreement, but that the dispute had already arisen when settlement agreement including the venue agreement, was entered into.

…0Saxo bank A / S can bring the case before the bank’s venue at the Court in Lyngby, …and the High Court therefore accepts Saxo Bank A / S ‘claim that the judgment of the district court be set aside and that the case be remanded for consideration at the Court in Lyngby, as a result.”

Court Amsterdam on the impact of the lex fori prorogati’s consumer laws for choice of court. A high net value Australian businessman sails away from Dutch jurisdiction.

I am catching up a little on recent case-law and am focussing it seems on the consumer section (see also yesterday’s post). This Court Amsterdam judgment published on 8 September caught my eye for it discusses choice of court, applicable law for the substantive validity of same, and ‘consumers’ in the context of buying yachts (now that I write that, in my exams I often have consumers buying yachts). Thank you Haco van der Houven van Oordt for signalling the case.

A purchase agreement for a yacht worth €5.4 million was signed in Singapore between buyer, an Australian living in Australia, and a Dutch shipyard. Seller’s GTCs mention

‘Article 17 – Settlement of disputes 1. Each agreement between [claimant] and the other party is subject exclusively to the laws of the Netherlands. 2. Any disputes which arise between the other party and [claimant], including disputes relating to the interpretation of these terms and conditions, will be put exclusively before the competent judicial body in Amsterdam.’

Pre-delivery was scheduled for December 2018 in Italy. Buyer changes his mind a week after signature, saying he will not be able to honour the agreed price. Vendor pursues the contractual penalty clause of 25% of the sale price. 

The judge finds the consent to choice of court to have been validly expressed on the basis of A25 BIa, under the classic Colzani formula. References to the GTCs had been properly made in the written contract. A duly diligent contracting party could and should have read these GTCs. Defendant’s argument that the choice of court clause in the GTCs should have been the subject of specific negotiation, is rejected [4.3.3].

As for the substantive validity of choice of court, the Dutch court (unlike eg the Belgian Supreme Court in Happy Flights) does add renvoi to the mix per recital 20 BIa. Dutch private international law (like the BE rules, nota bene) makes Rome I applicable to contracts even for the subject-matter excluded of its scope of application, among which choice of court agreements. Lex voluntatis therefore rules and the court holds that the choice of law for Dutch law for the contract as a whole, extends to choice of law for the forum clause [4.3.7].

The defendant finally alleges invalidity of the choice of court agreement on the basis of the lex fori prorogati’s rules on ‘potestative’ (unreasonably onerous) clauses. On this point, the defence succeeds: [4.3.9]: the defendant has to be qualified as a consumer under Dutch law, despite his high net value and the object of purchase, and the GTCs per article 6.236 n BW should have included a clause giving the consumer the option to opt for the default court with jurisdiction (which one that would be is not clear to me and the judgment does not specify it).

Seeing as the choice of court agreement is held to be invalid, that the defendant is domiciled in Australia, and in the absence of a relevant bilateral agreement between the two countries, Dutch residual rules are applied to assess alternative grounds for jurisdiction. There is no Dutch forum contractus, given delivery in Italy [4.5.1, with reference ia to CJEU Car Trim] and no other jurisdictional grounds have any traction.

Conclusion: no jurisdiction for the Dutch courts. The case is good material for the lex fori prorogati rule and for the realisation that even outside the context of the consumer title of Brussels Ia (defendant not being domiciled in the EU, that title was not triggered), consumer law plays an important role in choice of court.

Geert.

Rantos AG in TOTO. Important considerations on lis pendens and provisional measures, and on contractual drafting of choice of court.

Advocate General Rantos opined two weeks ago in C-581/20 Skarb Państwa Rzeczypospolitej Polskiej reprezentowany przez Generalnego Dyrektora Dróg Krajowych i Autostrad v TOTO SpA – Costruzioni Generali et al. – I propose we shorthand the case as ‘TOTO’.

Following public procurement, the Polish treasury granted the works for the construction of a stretch of motorway to an Italian consortium. In the contract, choice of court is made for Poland. The necessary guarantees eg for payment of fines in the event of late completion, were underwritten by a Bulgarian insurance company, whose guarantee is subject to Polish law. The consortium  to no avail sought negative declaratory relief (with a view to obtaining a finding that no fines are due under the contract) and injunctive relief (with a view to prohibiting the Polish authorities from exercising the guarantee) with the Polish court with substance matter jurisdiction. However it subsequently secured the injunctive relief from a Bulgarian court with Article 35 Brussels Ia provisional measures jurisdiction. This relief expressed itself inter alia in custodial attachment of the guarantees which the Polish authorities had sought to exercise with a European Order for Payment form. That Bulgarian relief is now before the Bulgarian Supreme Court.

The questions before the court are  whether the provisional measures can at all be ordered under the A35 gateway given that they might concern acta iure imperii and not civil and commercial matters; and if the matter is within the scope of BIa, whether the A35 court may still order such measures if the court with subject-matter jurisdiction has denied them. Finally, whether if the issue is within the scope of BIa, the ordinarily applicable Bulgarian rule that no such relief may be ordered against public authorities, must be set aside.

The Advocate-General suggests the Court settle the questions mainly by recourse to the lis pendens rule of A29 ff of the Regulation, rather than by the alternative of focusing on the ‘provisional’ nature of the measures imposed by the A35 court. A29 ff do not limit their application to substance matter proceedings hence if and when the lis pendens conditions are met, the court last seized must (identical cases) or may (related cases) relinquish its jurisdiction. The opposite is true, as well: if the A35 court has been seized first, the court with subject-matter jurisdiction has been gazumped at least for provisional measures.

The AG also (55 ff) suggests that choice of court must be read to include authority for the chosen court to issue provisional measures, but not (unless expressly agreed; an issue of contractual interpretation which must be left to the national judge to assess) the exclusion of other courts to exercise their A35 jurisdiction.

Finally if the court with subject-matter jurisdiction has taken a definitive decision viz the provisional measures, that decision travels under Title III BIa and A45 does not seem to offer room to object to recognition and enforcement. Should that decision not yet be definitive, the ordinary lis pendens rules must apply.

This is a case with rather important contractual drafting and civil procedure consequences.

Geert.

EU Private International law, 3rd ed 2021, 2.512ff, 2.550 ff, 5.584 ff.

 

Which ‘Dubai’? Guest post on Goel v Credit Suisse. The DIFC Court of Appeal on choice of court for ‘the Courts of Dubai’.

This guest  post was written by Ahmed Alzaabi, a legal researcher based at Abu Dhabi. It is great material for comparative conflicts purposes, as it highlights issues like ‘clearly demonstrated’ choice of court, hybrid jurisdiction clauses, and lex contractus for choice of court. Geert.

Introduction

The Dubai International Financial Center Court of Appeal (DIFC CA) delivered an interesting judgment in Goel and others v Credit Suisse (Switzerland) Limited [CA-002-2021} on 26 April 2021, which addresses the DIFC Courts opt-in jurisdiction. It is the most important decision since the opt-in clauses came into force in 2011. The case deals with personal guarantees entered into by Goel and others as Guarantors, and Credit Suisse AG as Lender. A term of the guarantee agreements refers to the jurisdiction of the “Courts of Dubai”.

An ex parte application was filed before the DIFC Court of First Instance (CFI) and was dismissed by H.E. Justice Ali Al Madhani on ground that the words “Courts of Dubai” were not specific, clear and express as required by Article 5(A)(2) of the DIFC Judicial Authority Law[i] (“JAL”) to opt-in into the DIFC jurisdiction.

The application was appealed and determined by Justice Wayne Martin, who ruled that the DIFC CFI has the jurisdiction to hear and decide any substantive claim filed by the Respondent. Justice Wayne Martin issued a world-wide freezing order (WFO) against the Guarantors and the order was appealed on the basis that the jurisdiction term in the Guarantee Agreements refers to the Courts of Dubai, and not to the DIFC Courts, therefore, the DIFC Courts shall have no jurisdiction to decide on this matter. The DIFC CA dismissed the appeal and upheld the ruling of Justice Wayne Martin.

Overview of the dispute:

  • Description of the parties. Credit Suisse AG (was a DIFC Establishment), and Credit Suisse (Switzerland) LIMITED (Respondent) are both subsidiary banks wholly owned by a Credit Suisse Group (a company registered in Switzerland). Goel and others (Appellants) are shareholders and directors of GP FZC (a parent company of GP Group of companies and offices all over the world).
  • Facts. On 13 May 2016, the Appellants entered into Guarantee Agreements with the Credit Suisse AG guarantying the performance of various borrowers of GP Group under a Credit Facility Agreement. Furthermore, on September 2016, Guarantee Transfer Agreements were signed between the Credit Suisse AG and the Appellants providing for the transfer of the rights and obligations of the guarantees to benefit the Respondent. The Appellants undertook to perform their obligations toward the Respondent as if the Respondent has been a party to the original Guarantee Agreements. At the time of signing the Guarantee and Transfer Agreements, the Credit Suisse AG was a “DIFC Establishment” within the definition of DIFC JAL. Neither Appellants nor Respondent were a DIFC Establishment.

The Guarantee Agreements provide in its clause 16 that the governing law is the Law of the Emirate of Dubai and the Applicable Federal Law of the United Arab Emirates. Clause 17 of the Guarantees (enforcement provision) refers to the jurisdiction of the Courts of Dubai, and clause 17.1 entitles the lender, Credit Suisse AG, to initiate legal proceedings before any other competent court. On the other hand, clause 7 of the Guarantee Transfer Agreements[ii] refers to the applicable law and jurisdiction, which states that any contractual or non- contractual obligations of the Transfer Agreements shall be governed by the Laws of the Emirate of Dubai, and the applicable Federal Laws of the United Arab Emirates. In addition, any dispute arising out of the Transfer Agreements which relates to any provisions of the Guarantees (as transferred and amended) shall be subject to the same jurisdictional provisions of the Guarantee Agreements.

  • Proceedings. The Respondent filed an application before the DIFC CFI requesting for a world-wide freezing order (WFO) to restrain the Appellants from dealing or disposing of their assets until the determination of the Respondent’s substantive claim. The CFI dismissed the claim on the ground that it has no jurisdiction, and stated that the order sought would have been granted if the court has the jurisdiction, as the Respondent made all the grounds for making such order. The Respondent appealed that decision, and the CA allowed the appeal and upheld that the judge of CFI should have granted that order on the basis that there is a good arguable case to the extent that the court has the jurisdiction. The CA added that, the CFI judge should have leave it open to the Appellants to challenge the court’s jurisdiction. Following this decision, the WFO was issued on 13 September 2020 and served on the Appellants. The Appellants filed an application to challenge the court’s jurisdiction arguing that the court lacked jurisdiction to issue that decision, and requested to dismiss the proceedings. Justice Martin, the assigned judge to hear the Appellants’ application, dismissed the application and held that DIFC Courts had the jurisdiction to hear and determine the Respondent’s substantive claim and the WFO against the Appellants, and he published his interesting reasoning for that decision on 4 October 2020.
  • CFI Decision. It was common ground for the judge and the parties that the applicable law governing the guarantees are the laws of the Emirate of Dubai and the applicable Federal Law of the United Arab Emirates. Justice Martin referred to Article 6 of the JAL, which provides that “the Court shall apply the DIFC Laws and Regulations, except where the parties have explicitly agreed to another law to govern the dispute, provided that that law doesn’t contradict with the public policy and morals”. Accordingly, he pointed that this article clarifies that the parties may select another governing law than DIFC Laws. However, the choice made by the parties will not place the dispute outside the DIFC Courts jurisdiction.

Justice Martin then focused on whether the Court has the jurisdiction to enter the WFO in support of the Respondent’s substantive claim. He had to determine a question of if the Respondent could establish that the claim against the Appellants passed through one or other of the “gateways” to the jurisdiction of the CFI as stipulated in Article 5 of the JAL. His finding was that the only available “gateway” is Article 5(A)(2) of the JAL, which states the following: “the Court of First Instance may hear and determine any civil or commercial claims or actions where the parties agree in writing to file such claim or action with it whether before or after the dispute arises, provided that such agreement is made pursuant to specific, clear and express provisions”. He further noted that the Respondent submitted and Appellants denied that clauses 17.1 and 17.2 of the Guarantee Agreements constitute an agreement in writing within the meaning of Article (5)(A)(2) of the JAL.

Justice Martin analysed the UAE Civil Transactions Code as a governing law applied to the contract and cited Articles 258 and 265, which address the intention of the parties to a contract. He also looked at a commentary on the Civil Transactions Code approved by the Ministry of Justice. The result of his analysis is that: “the both UAE legal system and the common law require the Court to confirm the join intention of the parties. The joint intention could be ascertained by interpreting words which the parties have used to record their agreement objectively, as they would be understood by a reasonable business person having the knowledge of the circumstances known to the parties at the time they entered into their contract”.

Justice Martin then referred to three prior decisions of DIFC Courts (Sunteck, Taalem, and IGPL), in which the CA rejected the proposition that the words “Dubai Courts” mean only non-DIFC Courts. He extracted from these three decisions the following propositions:

(a) it is not mandatory for the contract to specifically refer to the jurisdiction of the “DIFC Courts” to consider the gateway to the jurisdiction specified by Article 5(A)(2) of the JAL;

(b) the Court is to determine the question whether the joint intention of the parties meant to select the jurisdiction of DIFC Courts to hear such kind of dispute;

(c) that question could be resolved by referring to the natural and ordinary meaning of the jurisdictional words as the parties would have been mutually understood them having regard to the circumstances, the nature of the agreement and the context in which the words are used;

(d) if the Court concluded that the parties intended to refer to the DIFC jurisdiction when using the words recorded in their contract, those words will satisfy the requirements set by Article 5(A)(2) ““specific, clear and express provisions”;

(e) the words (Dubai Courts) or (Courts of Dubai) in their natural and ordinary meaning refer to all courts established in the Emirates of Dubai, including the DIFC Courts and the non-DIFC Courts;

(f) if one of the parties was a DIFC establishment at the time of signing a jurisdiction agreement, the other party would have taken into consideration and understood that the DIFC Courts, by default, would have the exclusive jurisdiction within Dubai to hear and determine any dispute arising out of that agreement. It would require a clear and express words to come to the result that the parties’ mutual intention is to exclude the jurisdiction of DIFC Courts.

Justice Martin selected the IGPL among the other two decisions, although it was an opt-out and not op-in case, but it shares common facts which are relevant to the question that the judge has to decide. The similarities with IGPL being (a) the relevant agreements were governed by the applicable Laws of UAE; (b) the words used in the jurisdiction agreements were identical (c) one of the party was a DIFC establishment at the time that the jurisdiction agreements were signed. Given those similarities, Justice Martin was bound to apply the reasoning in IGPL to conclude that clause 17.1 of the Guarantee Agreements indicates the mutual intention of the parties at the time that the agreements were signed. He highlighted that Credit Suisse AG was a DIFC Establishment at the time the guarantee agreements were signed. This constitutes a strong indication that the mutual intention of the parties was to include DIFC Courts within the meaning of the words “Courts of Dubai”. There was no indication of mutual intention of the parties to exclude DIFC Courts jurisdiction.

The judge stated the following circumstances which support the proposition that the words ‘Courts of Dubai’ should hold ordinary meaning to include DIFC Courts: “(a) the agreements are all in English language (the DIFC Courts operate in English); (b) Credit Suisse AG is a Foreign Company, incorporated in Switzerland; (c) a number of the borrowers under the Credit Facility Agreement were incorporated in foreign jurisdictions; (d) the Guarantors are all Indian nationals with Indian passports; and (e) clause 17.3 of each Guarantee expressly recognises the prospect of enforcement proceedings in foreign jurisdictions. These circumstances support the proposition that the parties have intended to refer to a court within the Emirate of Dubai which has an international characteristic as well as an onshore court of Dubai.

  • DIFC CA Decision. The Appellants challenged the CFI decision after the permission of appeal has been granted and provided that the CFI does not have jurisdiction to determine the substantive claim against the Appellants including the WTO application. The appeal was unsuccessful. The CA upheld that the jurisdiction clause used in the contract was a solid agreement to opt-in to the DIFC Courts’ jurisdiction in accordance with article 5 (A)(2) of the JAL. The CA added that when the term “the courts of Dubai” is used in an agreement, it has an ordinary meaning that refers to all courts incorporated within the Emirate of Dubai, including DIFC’s and non-DIFC’s Courts. Furthermore, the CA confirmed that the intention of the parties when they signed the agreement with a DIFC Establishment did not change the obligations on the Appellants when the Guarantee Transfer Agreements are signed in favour of a non DIFC Establishment. The CA then looked at the question of whether the clarity of the term “the courts of Dubai” is enough for the purposes of the gateway to jurisdiction within Article 5(A) (2) of the JAL.  The CA added that if as a matter of contractual construction, the parties had intended to agree that the DIFC Courts should have jurisdiction over their disputes, it would be a triumph of form over substance to hold that they failed because they did not use the term “DIFC Courts. On that note, the CA ruled that the parties’ contract was “specific, clear and express” enough to opt-in to the jurisdiction of the DIFC Court.

The CA highlighted in its conclusion that the construction of terms such as “courts of Dubai” will rely upon their context. Moreover, the transactions’ history matter in this case is significant to the constructional conclusion.

  • Conclusion. This case points out that the parties wishing to include or exclude DIFC jurisdiction should use a clear and express language in their contract to minimise jurisdictional disputes risk and avoid any ambiguity.

Royal Carribean v Browitt. On agency, consumer consent and choice of court Down Under.

Royal Caribbean Cruises Ltd v Browitt [2021] FCA 653 is a great addition to the comparative conflicts binder, particularly from the angle of ‘consent’ in business to consumer contracts. It also engages a classic tripartite relation between the consumer, signing a contract with a travel agent, whose GTCS in turn incorporate the GTCS of the carrier.

The case follows on from the December 2019 volcanic eruption at Whakaari.  (Mrs Browitt), for herself and as representative of the deceased estates of her late husband Paul and late daughter Krystal, and Stephanie (Ms Browitt), a daughter who survived the eruption with horrific injuries, are suing Royal Caribbean Cruises Ltd (RCCL), a Liberian registered company headquartered and operating in Miami, Florida, in the courts at Miami. There are applicable law and procedural advantages (incl discovery and trial (both on culpability and level of damages) by jury).

RCL Cruises Ltd (RCL) and RCCL apply for anti-suit in the FCA arguing that the Browitts were passengers on the Ovation of the Seas pursuant to a contract of carriage between the Browitts and RCL as the disponent owner and operator of the vessel. They seek a declaration that it was a term of the contract, signed at Flight Centre in Victoria, Australia, that any disputes between the parties would be subject to the exclusive jurisdiction of the courts of New South Wales.

The list of issues to be determined is long but I repeat it here anyways for they highlight the complexity of issues following a routine purchase of a cruise:

(1)    Was Flight Centre the agent of Mrs Browitt, RCL or both?

(2)    Were the RCL AU terms, including the exclusive jurisdiction clause, incorporated into the contract of carriage by: (a)    reference in the Flight Centre terms and conditions signed by Mrs Browitt on 14 February 2019? (b)    the text of a Royal Caribbean brochure? (c)    links on the RCL AU website? (d)    links in emails? (e)    links in the electronic guestbook?

(3)    As to the construction of the RCL AU terms: (a)    is RCL entitled to invoke the exclusive jurisdiction clause to restrain the Florida proceedings? (b)    is RCCL entitled to rely on the exclusive jurisdiction clause? (c)    did the purchase of insurance exclude the operation of the terms (cl 1)? (The respondents later dropped reliance on the purchase of insurance as excluding the operation of the exclusive jurisdiction clause, so this issue fell away.) (d)    does the contract of carriage apply to shore excursions (cl 25)? If not, does the exclusive jurisdiction clause nonetheless operate to restrain the Florida proceedings? (e)    does the exclusive jurisdiction clause permit a proceeding to be brought in the Federal Court of Australia sitting in New South Wales, and if not, what consequence follows from the commencement of this proceeding (cl 1, cl 37/38)? (f)    does the exclusive jurisdiction clause cover the Florida proceeding?

(4)    Is RCCL entitled to relief on the basis of the RCL AU terms?

(5)    Is the Florida proceeding vexatious and oppressive such that RCL and RCCL are entitled to an anti-suit injunction?

The judge held that although the Browitts were bound by the RCL AU terms, the Florida proceeding is not in breach of the exclusive jurisdiction agreement in those terms because RCCL is not a party to the agreement and RCCL does not enjoy the benefit of it. Also, there is no basis for the alternative case that the Florida proceeding is in any event vexatious and oppressive such as to justify an order restraining Mrs Browitt and Ms Browitt from pursuing it.

Terms and conditions were available on relevant websites and brochures, shown to and browsed by Mrs Browitt but not for the purposes of terms and conditions. Rather, as one would expect, for details of the journey, vessels etc. Unlike a quote, the eventual invoice included as part of the document three pages of booking terms and conditions. Some of those were highlighted in the copy made available to Mrs Browitt  Mrs Browitt could have read the GTCS but there was no inidcation she had or had been specifically pointed to them. Nothing in either version of the invoice, i.e., that which was printed for and signed by Mrs Browitt and that which was emailed by the agency, identifies which of RCCL and RCL was offering the cruise or operating the vessel.

The judgment, which I would invite readers to consult, eventually boils down to limitations of ‘agency’, privity of contract, and clear determination of contractual clauses. It does not decide for the Browitts on the basis of a particular concern for the weaker party in a classic B2C transaction, rather on the need for parties clearly to think through their spaghetti bowl of overlapping arrangements and GTCs when hoping to rely on them in court.

Geert.

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