CMR and the Brussels regime. The UKSC applies Nipponkoa in BAT /Essers.

Confession time: when teaching the general conflicts course I tend to simply say about Article 71 of the Brussels I Regulation (unchanged in the Recast): ‘it’s complicated’. I have also briefly flagged the Article in my posting on Nickel and Goeldner. I suppose I should not be quite so shy in addressing the relationship even in an introductory conflicts class for, essentially, it is not that complicated at least form a hierarchical point of view. Article 71 mirrors Article 351 TFEU which states that any rights or obligations arising prior to the TFEU shall not be affected by it unless the agreements are not compatible with the TFEU. At stake therefore is a review by the courts whether international agreements between the Member States prior to the creation of the EU, are compatible with the TFEU.

In [2015] UKSC 65  BAT Denmark v Kazemier and BAT Switserland v Essers, the United Kingdom Supreme Court had to carry out this exercise vis-a-vis the 1956 CMR Convention –   the Convention on the Contract for the International Carriage of Goods by Road. As Steven Baker notes, Lord Mance kicks off his judgment with the rather delightfully accurate ‘Cigarettes attract smokers, smugglers and thieves’. Tobacco manufactuters are also of course active litigators hence providing us with repeated opportunity to review case-law on a wide variety of contractual and other matters.

In the two appeals, one container load was allegedly hi-jacked in Belgium en route between Switzerland and The Netherlands in September 2011, while another allegedly lost 756 of its original 1386 cartons while parked overnight contrary to express instructions near Copenhagen en route between Hungary and Vallensbaek, Denmark.

The consignors (two of BAT’s corporate vehicles) are claiming against English main contractors who undertook responsibility for the carriage and against sub-contractors in whose hands the cigarettes were when the alleged losses occurred. The carriage was subject to the Convention on the Contract for the International Carriage of Goods by Road 1956 (“CMR”), given the force of law in the United Kingdom by the Carriage of Goods by Road Act 1965.

English law and English jurisdiction are said to offer the advantage that such duty and/or taxes are recoverable in a CMR claim against carriers, which is not the case in some other jurisdictions (at 4).

Citing (and reading in a particular way) CJEU precedent, in particular  Nipponkoa Insurance Co (Europe) Ltd v Inter-Zuid Transport BV (DTC Surhuisterveen BV intervening), C-452/12, the Supreme Court held (at 57) that CMR represents a balanced jurisdictional régime adopted across a wide-range of some 55 states, only half of which are Union member states. It did not regard its tailored balance as impinging on any of the principles of Union law which the CJEU would have it check against.

CMR applies therefore and under relevant English application, neither of the defendants can be sued in England.

Geert.

Subrogation of choice of court clauses: The ECJ (succinctly) in Refcomp

The ECJ has issued its ruling in Refcomp, Case C-543/10. I reported on Jaaskinen AG’s Opinion here. The Court effectively confirmed the Opinion, albeit within the boundaries of its customary judicial economy.

Like the AG, the Court first of all limits precedent value to a ‘chain of contracts under Community law’: i.e. a succession of contracts transferring ownership which have been concluded between economic operators established in different Member States of the European Union. It subsequently re-affirms the consensual nature of jurisdiction clauses as insisted on by Article 23 of the Jurisdiction Regulation, and the Brussels Convention before it.  ‘It follows that the jurisdiction clause incorporated in a contract may, in principle, produce effects only in the relations between the parties who have given their agreement to the conclusion of that contract. In order for a third party to rely on the clause it is, in principle, necessary that the third party has given his consent to that effect.’

In a chain of contracts transferring ownership, the relationship of succession between the initial buyer and the sub-buyer is not regarded as the transfer of a single contract or the transfer of all the rights and obligations for which it provides – in contrast with bills of lading for which the Court had previously (Case C‑387/98 Coreck) held that a jurisdiction clause incorporated in a bill of lading may be relied on against a third party to that contract if that clause has been adjudged valid between the carrier and the shipper and provided that, by virtue of the relevant national law, the third party, on acquiring the bill of lading, succeeded to the shipper’s rights and obligations.

Basically, under French law and French law (almost) alone, the action by Doumer against Refcomp would, exceptionally, be considered contractual. In the other Member States, it would not. To refer, the court holds, the assessment as to whether the sub-buyer may rely on a jurisdiction clause incorporated in the initial contract between the manufacturer and the first buyer to national law, would give rise to different outcomes among the Member States liable to compromise the aim of unifying the rules of jurisdiction pursued by the Regulation. The concept of ‘jurisdiction clause’ referred to in that provision therefore must be interpreted as an independent concept, guided by the need to give full effect to the principle of freedom of choice on which Article 23(1) of the Regulation is based.

The ECJ therefore holds that

Article 23 of Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters must be interpreted as meaning that a jurisdiction clause agreed in the contract concluded between the manufacturer of goods and the buyer thereof cannot be relied on against a sub-buyer who, in the course of a succession of contracts transferring ownership concluded between parties established in different Member States, purchased the goods and wishes to bring an action for damages against the manufacturer, unless it is established that that third party has actually consented to that clause under the conditions laid down in that article.

Geert.