Clarke v Kalecinski. On rules of safety and conduct under Rome II, but also on the implications of marketing language for duty of care.

Update 20 April 2022 Daniel Clarke reviews the issue of proof of foreign law here.

Clarke v Kalecinski & Ors [2022] EWHC 488 (QB) concerns a claim for damages for personal injury sustained during cosmetic surgery undergone by claimant on 7 January 2015. Claims is against the surgeon (domiciled and habitually resident in Poland; but also registered with the UK General Medical Council) who performed the breast and thigh procedures in Poland, and against the Clinic (a company incorporated in Poland in which  the surgeon and his wife are the sole shareholders and directors), where the operations were carried out and she received pre-and post-operative treatment. Claimant also sues the insurer of the Clinic.

Jurisdiction is not disputed. Both surgeon and clinic are being sued under the consumer title of Brussels Ia. The insurance company is being sued under CJEU Odenbreit: subject to the applicable law of the tort and the existence under same of a direct right of action against an insurer, section 3 BIa gives claimant a right to sue in claimant’s domicile.

Claimant sues both surgeon and clinic, both in contract and in tort. She seeks to hold the clinic either directly or vicariously liable for the failures of the surgeons who treated her – one other Polish surgeon was involved in her care – and the nurses who cared for her at the clinic in Poland. Total potential liability for the insurance company, under the indemnity of the clinic (they do not insure the surgeon) is limited to approximately £38,500.

Proper law of the contract is English law, per A6(1) of the consumer title of Rome I. This is not disputed. It had been anticipated by claimant until trial that it was also a matter of agreement that the proper law of the claim in tort was Polish law, per Rome II. However in its skeleton argument, for the first time, the insurer raised an issue about the adequacy of claimant’s pleading arguing they had failed to plead the Polish law upon which they relied, so the proper law of the tortious claim was by default, English law.  That was rejected by the judge on the basis of the exchange between parties.

At [104] ff Foster J discussed the application of A17 Rome II: the judge must take into account as a matter of fact, the rules of safety and conduct in force at the place and time of the event, i.e. Poland. However [107] the judge insists on the importance of the English standard of care

where it is a term of the contract that the first defendant would operate to the same standard as a UK surgeon, skilled in this specialism, and registered with the GMC, it is that standard, that applied to the activities in issue here. The care offered by the clinic likewise. [emphasis in the original]

Those terms of the contract were deduced by the judge [77]:

[claimant] does not allege that she signed any contract or document, save for a consent form which the court has not seen. However, in my judgement the substance of the representations on the website upon which Ms Clarke clearly relied, were incorporated into the contract between her and the clinic together with Mr Kaleciński. In my judgement this was one contract but involving both parties: the surgeon and all the other care givers at the clinic, by means of the clinic (Noa Clinic Uslugi Sp. z o.o), those incorporated representations were to the following effect. The first defendant would carry out the surgery and he would carry it out to the standard to be expected of a GMC registered surgeon proficient in plastic surgery.

This emphasis by the judge imparts once again the relevance of language, no doubt for marketing purposes, for the consequential legal obligations. Foster J moreover holds [108]

That standard applies to the tortious duty also by reason of the  representations made to which reference is made above.

and [109] she holds

the findings of [the expert] are couched in such stringent terms that they cover any surgical and indeed clinical practice whether governed by local Polish customs or not. The conclusions of [the expert] put paid to any subtlety of distinction between local custom and English practice that might … in other circumstances be considered relevant. What took place fell so far below acceptable standards I cannot accept the contention that local standards or practices might have rendered the egregious failings in this case acceptable as a matter of contractual or tortious obligation.

The judge’s findings on A17 Rome II are interesting. Yet I find her conclusions on website representations even more relevant.

Geert.

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.

 

Hill v Generali. Assigned and /or subrogated claims continue to cast doubt on the application of Brussels Ia’s insurance title.

Hill v Generali Zrt [2021] EWHC 3381 (QB) is an appeal from the County Court and discussed whether a subrogated claim by an insurer (Admiral) can be brought in the name of an English motorist in an English court together with his claim for uninsured losses against a Hungarian insurer (Generali) in respect of a pre-Brexit accident in Germany. The county court judge held that it could not but acknowledged that the question was not free from doubt and granted the motorist permission to appeal. Upon appeal the opposite conclusion was reached.

The case once again therefore concerns Brussels Ia’s insurance title which was recently at play at the CJEU in Betty Tattersal aka Seguros Catalana Occidente. Pepperall J summarises the ordinary application of the insurance title as follows [8]

Re the insured losses (the repair costs): __Generali can be sued in Hungary, being its place of domicile, or Germany, being the place of the accident: A4(1), 7(2), 11(1)(a) and 12 BIa___As the insured, Mr Hill can also sue Generali in England & Wales, being his place of domicile: A11(1)(b).___ As the insurer, and subject to being permitted to join an action already proceeding in another jurisdiction, Admiral cannot take advantage of the more favourable rules as to jurisdiction available to the policyholder, the insured and beneficiaries. 

There is therefore no dispute as to Mr Hill’s right to sue for his uninsured losses (the devaluation of the car) in England & Wales. The issue is whether Admiral’s subrogated claim:  is a claim brought by the insured such that it may be pursued in England & Wales under Article 11(1)(b); or is a claim that must be treated as brought by the insurer such that it cannot, subject to questions of joinder, be pursued in E&W.

Relevant recitals echo the general principles with which the CJEU approaches the issue: [10]:

“15 The rules of jurisdiction should be highly predictable and founded on the principle that jurisdiction is generally based on the defendant’s domicile. Jurisdiction should always be available on this ground save in a few well-defined situations in which the subject-matter of the dispute or the autonomy of the parties warrants a different connecting factor …

16 In addition to the defendant’s domicile, there should be alternative grounds of jurisdiction based on a close connection between the court and the action or in order to facilitate the sound administration of justice. The existence of a close connection should ensure legal certainty and avoid the possibility of the defendant being sued in a court of a Member State which he could not reasonably have foreseen …

18 In relation to insurance, consumer and employment contracts, the weaker party should be protected by rules of jurisdiction more favourable to his interests than the general rules.

21 In the interests of the harmonious administration of justice it is necessary to minimise the possibility of concurrent proceedings and to ensure that irreconcilable judgments will not be given in different Member States. There should be a clear and effective mechanism for resolving cases of lis pendens and related actions …”

Part of the challenge is the different way in which claims are assigned /and or subrogated across jurisdictions [23]. In many European legal systems insurers take an assignment of the insured’s claim and sue to recover their outlay in their own names. In the common law’s approach the claim for insured losses remains vested in the insured.

CJEU Sovag is discussed for the joinder elements of the case and CJEU Kabeg is said not to be a right fit for in that case the insurer was the assignee of the claim for insured losses and able to sue in its own name.

The judge reaches his conclusion that the subrogated claim may be brought in E&W on the echo of SOVAG, hence underlining [34] the policy of minimising multiple proceedings and ensuring that irreconcilable judgments are not given but also in demonstrating practicality. The CJEU arguably in Betty Tattersal (the judge did not have the benefit of that judgment) took a different direction  on related issues and I find them both equally persuasive. It is time the insurance section be sorted out and the current EC evaluation of BIa would be a good trigger for same.

Geert.

Chowdhury v PZU SA. Domicile for the purposes of the insurance title.

Chowdhury v PZU SA [2021] EWHC 3037 (QB) is worth a brief post on the determination of ‘domicile’ for the purposes of the insurance title of Brussels Ia (the very same Title and provisions which I discuss in Betty Tattersal). Ritchie J discusses whether the claimant was ‘resident’ in England and Wales for despite the insurance section talking of ‘domicile’, the Regulation refers for that notion to the residual rules of the Member States; and in England and Wales, domicile for natural persons, for private international law purposes, is determined by their ‘residence’.

The judge held, having summarised all relevant authority, that the earlier finding of residence absolutely stands [72]:

Claimant was a British citizen, with a British passport, who grew up in Worthing and was educated in England, worked in England, had his parents and family in England, had his friends in England, had rented flats in London, in Earls Court and in Putney, had his benefits paid in England, had his property by way of clothes and personal items in England and kept some of those at his parents’ house in Worthing, in his own room there.

That he gave up his rental accommodation in England was entirely due to him seeking medical treatment in Germany on account of the very tort he is suing for. Clearly that could not dislodge his English residence, despite the most likely temporary impact on physical stays in England.

Geert.

The CJEU holds back on vis attractiva securalia in Betty Tattersal aka Seguros Catalana Occidente (re: the insurance Section).

Update 25 02 2022 see further analysis by Matthias Lehmann here.

I cross-referred to the pending preliminary review in C-708/20 Betty Tattersall aka Seguros Catalana Occidente  in my review of Flowers v Centro Medico. The CJEU held this morning in Betty Tattersall (which also means the Flowers case may now continue). I call the issue ‘vis attractiva securalia’ which is a term I made up but hopefully usefully summarises the issue. Domicile of the claimant, as readers of the blog will know, is generally of no consequence in EU jurisdictional rules. There are a few exceptions, in particular for the protected category of consumers (for employees, it is the place of habitual performance of the employment contract which is relevant, which often co-incides with their domicile), and for insurance contracts – but in the latter case, it turns out, not of benefit for the injured party.

Ms Tattersall argues that , in relation to EB, who is domiciled at Ireland and owns the holiday home which Ms Tattersall rented and in which she suffered a fall, that a claimant may bring an action against an insurer domiciled abroad under A13(3) BIa. A13 effectively piggy-backs claims of the injured party viz liability insurance, unto the by virtue of A11-12 extended forum possibilities for the insured, the policyholder or beneficiary of the insurance policy. In her view, the existence of a ‘dispute’ between the insurer and the insured regarding the validity or effect of the insurance policy is not necessary in that regard. The only requirement under A13(3), she suggests, is that such an action against the insured is provided for by the law governing direct actions against the insurer, in this case Spanish law. EB by contrast argues that Ms Tattersall’s claim is not an insurance claim and cannot become one merely because it was brought in the same action as the direct action against the insurer.

One can see why Ms Tattersall attempted to join EB into the English procedural bath: the insurer is an interesting defendant of course for it has deeper pockets; however EB’s insurer argue that the limitations and restrictions in the insurance policy meant that the policy did not extend to EB’s use of the property for the purpose of accommodating third parties on holiday against payment. Should that argument hold on the merits, Ms Tattersall’s claim will fall flat and she would have to sue EB separately, in Ireland.

The CJEU insists on the need to read the insurance Section with its specific purpose in mind: the protective effect intended by the Section is aimed at those considered to be in a weaker position vis á vis the insurer: the insured and the injured person are considered to be the weaker party in the contractual relationship, not the third party who is in a non-contractual relationship to both. Therefore [30]

to justify the application of the special rules of jurisdiction laid down in Section 3 of that regulation, the action before the court must necessarily raise a question relating to rights and obligations arising out of an insurance relationship between the parties to that action.

The Court does [35-36] acknowledge recital 16 BIa which refers to the objective of facilitating the proper administration of justice. It concedes that the involvement, by the injured person, of the insured, as a third party to the proceedings before the court seised, would make it possible to avoid the risk of the coexistence of two parallel sets of proceedings. Nevertheless, the emphasis must fall on the effet utile of A7(2): allowing the injured person to bring an action against the insured on the basis of A13(3) would amount to circumventing the forum delicti rules of A7(2). Each injured person could then bring an action against the insurer on the basis of A13(2), to benefit from the more favourable provisions of A10 to 12 in order, subsequently, to bring an action against the insured, as a third party to those proceedings, on the basis of A13(3).

The CJEU’s’ formal reply therefore is that

Article 13(3) of Regulation (EU) No 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters must be interpreted as meaning that, in the event of a direct action brought by the injured person against an insurer in accordance with Article 13(2) thereof, the court of the Member State in which that person is domiciled cannot also assume jurisdiction, on the basis of Article 13(3) thereof, to rule on a claim for compensation brought at the same time by that person against the policyholder or the insured who is domiciled in another Member State and who has not been challenged by the insurer.

Readers may enjoy the strategic off the cuff claim engineering possibilities which I entertained with Sarah Crowter QC.

Geert.

Flowers v Centro Medico. Brussels Ia’s insurance issues stayed pending CJEU authority, and disputable conclusions on the consumer section.

Flowers & Ors v Centro Medico Salus Baleares SL & Anor [2021] EWHC 2437 (QB) is a case packed with jurisdictional complication under Brussels Ia. In early February 2020, Mrs Yvonne Flowers, then 67 years of age, was admitted on an emergency basis to a private hospital facility in Benidorm, Spain, with significant back discomfort and pain arising from spinal disc herniation. Nine days later she died in the same hospital from multiple organ failure having contracted sepsis. T

The principal issues at stake concern the level of proof required for a jurisdictional challenge; determination of domicile; the existence of a consumer contract and who can all avail themselves of the consequential jurisdictional rules; and when a matter ‘relates to’ insurance’.

Starting with the latter, Wood J stayed judgment on much of the issues until the CJEU will have ruled in C-708/20 Betty Tattersall,  on which James Beeton reports here and which engages similar issues as CJEU Cole, settled before judgment, and Hutchinson. Betty Tattersall will be a crucial judgment.

The level of proof for jurisdictional challenges was discussed at an extraordinary length in Brownlie, and the SC’s ruling is applied here as detailed in the judgment.

The claimants’ domicile is not ordinarily relevant under BIa but it is for the consumer and insurance title and its determination is subject to national law. Seeing as the judge finds a good arguable case that domicile is indeed established in England, no consideration of Spanish domicile rules is necessary.

The ‘newer’ elements of the case are first of all the existence of a consumer contract. There are 3 issues [67]: (i) Was there a contract between the late Mrs Flowers and Centro Medico? (ii) If there was, was it a consumer contract within the meaning of section 4 BIa? (iii) Does the Claimant’s claim against Centro Medico fall outside the scope of the consumer contracts section because it has not been brought by the “consumer” within the meaning of the section?

Ia Committeri is relied on and the judge has little hesitation [115] to find the existence of a contract. (Much about that has been written in German scholarship in the specific area of medical services).

Surprisingly though, the question whether there is a contract which meets with the A17 requirements is brushed over when it comes to the question whether the hospital directs its activities to England and Wales, which the court established as the relevant  domicile. Particularly in the context of emergency care, this does not seem to be a given.

The judge does enquire as to whether the claim which can no longer be pursued because the contracting (and thus weaker) party is now deceased, can be picked up by heirs in the same jurisdictional gateway and pursued on the basis of the domicile of either the deceased or the heirs. Schrems and KABEG are discussed, however unlike the first instance judge in Bonnie Lackey, Justice Wood [126] adopts a much less wide approach. There must be scope for a lot more discussion on this, for the scenario in Bonnie Lackey, of which I was critical, is quite different from that of the heirs who step in the  litigation shoes of the deceased.

Geert.

EU Private international law, 3rd ed. 2021, big chunks of Chapter 2.

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

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

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

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

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

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

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

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

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

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

Geert.

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

The insurance title and branch jurisdiction under Brussels Ia. Sánchez-Bordona AG in CNP.

Sánchez-Bordona AG opined last week in C-913/19 CNP. The issue is whether a Polish court has international jurisdiction to rule on a dispute between a company to which a person injured in a road traffic accident that occurred in Poland had assigned his rights, and the insurance undertaking, established in Denmark, which insures the risks of the person who caused the accident. Krzysztof Pacula has interesting Polish context here. He also gives more background to the market and legal implications of involving third parties (such as garages repairing vehicles and providing replacement vehicles) and I am happy to refer to his analysis.

On applicable law and assignment, the EC has proposed rules which complement Rome I. That proposal is making its way through the Institutions, at snail’s pace. On jurisdiction, CJEU Hofsoe clarified one or two things but also created extra fog. The UKSC distinguished Hofsoe in Aspen Underwriting, not however without great effort and with continuing question marks. This really is an area which could do with co-ordinated Rome I and BIa legislative tweaking.

On the specific issue of branch jurisdiction, the case echoes Ryanair v DelayFix. The AG finalises his analysis on that question as follows:

 a commercial company established in a Member State which operates under a contract with an insurance undertaking established in another Member State may be classified as a ‘branch, agency or other establishment’ of that undertaking if, cumulatively:

–        it operates in a Member State by providing compensation for material damage on the basis of insurance against civil liability arising from the use of motor vehicles the risks connected with which are covered by the insurance undertaking;

–        it has the appearance of an extension of the insurance undertaking; and

–        it has a management body and material facilities such as to enable it to transact business with third parties, so that the latter, although knowing that there will if necessary be a legal link with the insurance undertaking, do not have to deal directly with that undertaking.’

Not of course a set of criteria which lead to much spontaneous predictability – again an issue which in the specific insurance context could do with statutory intervention.

Geert.

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

Yet more on The Prestige recognition tussle. On service, state immunity and the insurance title of Brussels Ia.

I have twice already reported on The Prestige recognition issue: see here and here. In a further judgment at the end of July, [2020] EWHC 1920 (Comm), Butcher J after helpfully summarising the various claims, considered

  • whether a Member State may be served under the EU Service Regulation 1393/2007, or whether residual PIL (here: the UK State immunity Act) may insist on an alternative. This did not so much engage the issue of ‘civil and commercial’ (CJEU Fahnenbrock being cited) on which both parties agreed. Rather on the exhaustive effect or not of the Service Regulation, in particular, whether Member States may insist on service upon authorities of other Member States via diplomatic means only. Butcher J holding correctly in my view at 45, that service via the means provided for in the Regulation, suffices.
  • next, whether the case engages sovereign immunity of Spain and France which Butcher J held that they do not for the most part. He mostly cites the States’ submission to arbitration in this respect.
  • further, whether the English courts have jurisdiction or whether that is ruled out by virtue of the arbitration exception or the insurance title of the Regulation (at 93 ff; the preceding paras concern claims which fall outside BIA and are to be judged under common law). At 107 Butcher J holds that the arbitration exclusion is not engaged, citing national and CJEU authority as well as recital 12 BIa, and holding at 108 that ‘(t)he present Judgment Claims are a further step beyond what is contemplated by an ‘action or judgment concerning … the enforcement of an arbitral award’ in recital (12).’ As for the insurance heading, with reference to Aspen Underwriting, he holds that the insurance title is engaged, and (at 132) that the States they are entitled to the jurisdictional protections of Section 3, without it having to be shown that they are in fact economically weaker parties. (There is a lingering doubt over one of the claims subrogated to Spain). The insurance title being engaged, this mains that the parties protected by it may only be sued in their jurisdiction (Article 14(2)’s exception to that was held not to be applicable), hence the English Courts for those claims do not have jurisdiction.

The result is a partial jurisdiction in England only – and permission to appeal, I imagine.

Geert.

(Handbook of) EU Private International Law, 2nd ed. 2016, Chapter 2, Heading 2.2.11.1, Heading 2.2.11.2, Heading 2.2.16.

 

‘Like Dassonville on steroids’. Bobek AG in Rheinland on personality v territoriality, the nature of EU harmonisation, and its links with (as well as historic roots of) conflict of laws and regulatory competition.

In advising on a territorial restriction in an insurance clause earlier this month, I studied the CJEU judgment in C-581/18 Rheinland, important for the (limitations to the) reach of Article 18 TFEU, the general non-discrimination requirement on the basis of nationality. Bobek AG had earlier opined, and the Court followed, that in the absence of harmonisation and in a scenario with no EU links, Article 18 TFEU is not engaged. I had missed the AG’s earlier opinion – forgive me if I am late to this party.

It is important to sketch the context: Bobek AG had summarised the facts as

A German patient received, in Germany, defective breast implants manufactured by Poly Implant Prothèse SA (‘PIP’), a French undertaking that is now insolvent. The patient seeks compensation before the German courts from Allianz IARD SA, the French insurer of PIP. In France, manufacturers of medical devices are under a statutory obligation to be insured against civil liability for harm suffered by third parties arising from their activities. That obligation led PIP to conclude an insurance contract with Allianz, which contained a territorial clause limiting the cover to damage caused on French territory only. Thus, PIP medical devices that were exported to another Member State and used there were not covered by the insurance contract.

In this context, the Oberlandesgericht Frankfurt am Main (Higher Regional Court, Frankfurt am Main, Germany) enquires whether the fact that PIP was insured by Allianz for damage caused by its medical devices on French territory only, to the exclusion of that potentially caused in other Member States, is compatible with Article 18 TFEU and the principle of non-discrimination on grounds of nationality contained therein.

This post is not on Article 18 TFEU. Rather, consider the excellent (and eloquent) discussion by Bobek AG at 109 ff. Does the imperative of equal protection of all European citizen-consumers, in the absence of EU harmonising law on the issue, preclude a national rule that, in effect, limits insurance cover to persons who undergo surgery on the territory of the Member State, thus indirectly limiting the cover to citizens of that Member State? Bobek AG emphatically and despite moral sympathy for the victims, says no. The alternative would be ‘like Dassonville on steroids’ (at 111), it would ‘turn regulatory competence within the internal market on its head’ (at 109).

Consider his link with conflict of laws at 114-115:

In other words, the fact that goods once came from another Member State is not a sufficient reason to suggest that any matter later concerning those goods is covered by EU law. If that logic were to be embraced, by a questionable interpretation of Article 18 TFEU, the movement of goods in Europe would become (once again) reminiscent of medieval legal particularism, [at footnote 78 he refers to the excellent work by my legal history colleague Randall Lesaffer] whereby each product would, like a person, carry its own laws with it. Goods would be like snails, carrying their homes with them in the form of the legislation of their country of origin, to be applicable to them from their production to their destruction.

Such a consequence would not only displace any (normal) territoriality in the application of laws, but would also generate conflicts of regulatory regimes between the Member States. Indeed, such an expansionist interpretation of Article 18 TFEU could make the legislation of any of the Member States potentially applicable on the same territory without any clear and objective criteria as to which legislation should prevail in a given dispute, with the victim being able to choose the most favourable legislation.’

Most delightful analysis.

Geert.

 

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