Posts Tagged Tort
JSC BTA Bank v Khrapunov. UK Supreme Court confirms the conspiracy itself, not its implementation, as locus delicti commissi under Lugano. Does not entertain locus damni.
The UK Supreme Court held in  UKSC 19 JSC BTA Bank v Khrapunov late March. Defendant is based in Switzerland, hence triggering the Lugano Convention. Addleshaw Goddard have the history of the case and I am happy to refer for those facts. Suffice to say that at the core is a claim in tort of conspiracy, alleging that Mr Khrapunov and his father in-law Mr Ablyazov conspired to injure the Bank by preventing it from enforcing its judgments against Mr Ablyazov’s assets.
First let’s have a look at was not discussed at the SC: domicile and locus damni. As for the former, domicile once held but now fleed from was correctly rejected by Teare J as establishing domicile under Lugano (or indeed Brussels). The argument that jurisdiction should, nevertheless, be taken still to be domiciled in England because defendant was in breach of an obligation under the worldwide freezing order prohibiting him from leaving the jurisdiction, was likewise rejected. An interesting proposition though.
Now, for the location of the locus damni. At 29 the SC refers to the Bank’s argument at the High Court and Court of Appeal stage. The Bank’s argument was that the damage occurred in England. This was based on the contention that its worldwide freezing order and its judgments against Mr Ablyazov were located here and had been reduced in value by the alleged conduct in relation to assets in other jurisdictions. The High Court and Court of Appeal considered that the element of damage proximate to the harmful event was the Bank’s inability or reduced ability to execute against those assets in the places where they were located. Another fine example of the difficult implications of Bier and not one which the CJEU has hitherto had the occasion to review. (But current case will not reach it).
As for locus delicti commissi, the Bank submit that the event giving rise to the damage was the conspiracy itself, which was hatched in England. At the High Court Teare J rejected this submission, because he considered that the cause of the damage was not the conspiracy but its implementation: a suggestion I like in the context of competition law, as readers of the blog will be aware. Teare J was not followed by the Court of Appeal though, which identified the place where the conspiratorial agreement was made as the place of the event which gives rise to and is at the origin of the damage.
The SC refers to CJEU authority to conclude with CDC and at 41 it reiterates the CA’s core reasoning: ‘As Sales LJ explained (at para 76), in entering into the agreement Mr Khrapunov would have encouraged and procured the commission of unlawful acts by agreeing to help Mr Ablyazov to carry the scheme into effect. Thereafter, Mr Khrapunov’s alleged dealing with assets the subject of the freezing and receivership orders would have been undertaken pursuant to and in implementation of that agreement, whether or not he was acting on instructions from Mr Ablyazov.’
The Supreme Court concludes that the making of the agreement in England should be regarded as the harmful event which set the tort in motion.
The judgment keeps open many issues, however. For starters, to have a sole birthplace of conspiratorial agreement is handy in the case at issue however it is likely not often to be so clearly the case (as Dan and Tom point out, particularly not in a digital context). Moreover, for those instances where Mr Khrapunov were not to be acting on instructions from Mr Ablyazov, questions of ultra vires so to speak and hence of a separate tort would arise.
(Handbook of) EU Private International Law, 2nd ed. 2016, Chapter 2, Heading 188.8.131.52
Thank you Andreas Christofides for flagging Aristou v Tesco Personal Finance, a case which engaged Article 7(2) and, I presume, Article 7(1) Brussels I Recast: forum delicti cq forum contractus. I tried to obtain copy of judgment but failed. It might not have helped me much anyway for I assume it was drafted in Greek.
For the facts of the case please refer to the link above. From Andreas’ description of the case I am assuming the Cypriot court firstly must have decided there was a contract between claimant and the UK bank, per Handte; that this was a service contract; and that per 7(1)b second indent, that service was provided in the UK. And that for the application of Article 7(2) both locus delicti commissi and locus damni were also the UK. (The court may in doing so have referred to Universal Music: not just location of the bank account in the UK but other factors, too).
Any Greek readers, in possession of the judgment: please correct if need be.
(Handbook of) EU Private international law, 2nd ed. 2016, Chapter 2, Heading 184.108.40.206.7; Heading 220.127.116.11.b.
A case title which sounds a bit like a Scandinavian crimi – that’s because it almost is. In  EWHC 2570 (Pat) Parainen Pearl et al v Jebsen Skipsrederi et al the facts amounted to claimants, who had purchased a vessel containing a pneumatic cement system patented by defendant (a company domiciled in Norway), seeking a declaration of non-infringement (DNI) of said patent. The purchase was somewhat downstream for the vessel had been sold a number of times before.
Claimants suggested jurisdiction for the UK courts for DNIs relating effectively to the whole of the EEA (at least under their reasoning; the specific countries sought were Sweden and Finland). For the English (and Welsh side of things jurisdiction is established without discussion under Article 5(3) Lugano, forum delicti. Reference was made to Wintersteiger and to Folien Fischer.
Claimants suggested that by the first sale to the original owner, defendants had ‘exhausted’ their intellectual property thus rendering the vessel into a good free to sold across the EEA. Should the court agree with that view, that finding of exhaustion would have to be accepted, still the argument went, across the EEA. Hence, an initial finding of exhaustion, given the need to apply EEA law the same in all EEA Member States, would have to be accepted by all other States and conversely this would give the English courts jurisdiction for pan-EEA DNIs.
Arnold J refers to among others Roche, Actavis v Eli Lilly, Marzillier. He holds that a potential finding by an English court of exhaustion may not necessarily be recognised and enforced by other courts in the EU or indeed EEA: it is not for the UK courts to presume that this will be so (despite their being little room for others in the EEA to refuse to enforce): ‘(Counsel for claimant) argued that.., on a proper application of European law, there could only be one answer as to whether or not the Defendants’ rights under the Patent in respect of the Vessel had been exhausted. In my view, however, it does not follow that it would be proper for this Court to exercise jurisdiction over matters that, under the scheme of the Lugano Convention, lie within the province of the courts of other Contracting States.’
Article 5(3) which works for UK jurisdiction, can then as it were not be used as a joinder-type (Article 6(1) Lugano; Article 8(1) Brussels I Recast) bridgehead for jurisdiction on further claims.
Conclusion: UK courts have no jurisdiction in so far as the DNIs extend beyond the UK designation of the Patent.
(Handbook of) EU Private international law, 2nd ed. 2016, Chapter 2, Heading 18.104.22.168.4, Heading 22.214.171.124.
Heavily loaded. Applicable law in follow-up competition cases: watch the Dutch Supreme court in Air Cargo.
Update March 2018. Quentin’s blog has a link to the SC decision refusing to take the case, considering it was academic given that an appeal against the decision of the European Commission is still pending before the EU courts. It has therefore not irreversibly been decided whether the eleven air carriers had violated European competition law. Most probably the case will be back, one imagines.
Quentin Declève alerted me to the Air Cargo damages compensation case currently making its way through the Dutch courts. (I have previously reported on jurisdictional issues re such cases; searching the tag ‘damages’ should help the reader).
I have difficulty locating the actual judgment addressing the issue in this post: namely applicable law in follow-up competition cases. I have however located one or two previous judgments addressing the damages claims assignment issue in same. This web of litigation seems to be particularly knotty and any help by Dutch or other readers would be appreciated.
At issue is whether Rome II applies to the facts ratione temporis; if it does, how Article 6 should be applied, in particular: locus delicti commissi, locus damni and ‘affected markets”; and if it does not, how the previous Dutch residual connecting factor ought to apply.
A case of great relevance to competition law and fair trading cases.
(Handbook of) EU private international law, 2nd ed. 2016, Chapter 4, Heading 4.6.2.
Kennedy v National Trust for Scotland. Applying forum non conveniens within the UK. And how to make a case ‘international’.
In  EWHC 3368 (QB) Kennedy v National Trust for Scotland, Eady J considers two important (for this blog at least) issues leading to dicta: when a prima facie domestic case may turn out to be international really; and following his ruling on same, the application of forum non conveniens intra-UK. I reviewed the latter issue, also intra-UK, in my analysis of Cook & McNeil (v Virgin & Tesco).
First the issue of the case being purely domestic or international. It is only when it is the latter, that the Brussels I Recast regime is engaged and, per Owusu, forum non conveniens excluded.
The Claimant, who is domiciled in Scotland, seeks damages and other remedies in this jurisdiction against the National Trust for Scotland in respect of a number of allegations published in both jurisdictions as well as in Italy, France and Brazil. He relies not only on defamation but also on negligence and on alleged breaches of the Data Protection Act 1998. The dispute arises over the Claimant’s attendance at Craigievar Castle in Aberdeenshire on 23 February 2012, when he took a series of photographs of a naked model for commercial purposes. He claims that he did so pursuant to an oral contract, entered into with a representative of the Defendant, which expressly authorised that activity. Some years later, this episode came to the attention of the daughter of Lord Sempill who had gifted the castle to the Defendant (more than 50 years ago) and she protested that it had been used for the purpose of taking nude photographs. Her remarks caught the attention of a journalist who made enquiries and was given a statement by or on behalf of the Defendant on 24 February 2016 which was reported in the Scottish Mail on Sunday of 28 February. Thereafter, the Defendant also issued a press release which denied that the taking of the photographs had been authorised. This was sent to a number of media outlets including a reporter on the (London) Metro newspaper.
Claimant suggests that this is not “a purely domestic case” by referring to re-publication of the defamatory words in France and Italy. At 51 Eady J, with reference to the aforementioned Cook v Virgin Media, suggests the purpose of the regulation, and of the rule of general jurisdiction in particular, is to regularise issues of jurisdiction as between different states, and that no such question arises here, because the only potential competition is between the courts of Scotland and England & Wales (i.e. internal to the United Kingdom). I do not think this is the effect of CJEU precedent, Lindner in particular, as well as Maletic and Vinyls Italia (the latter re Rome I). The potential competition between the England and Scotland only arises if, not because, the Brussels I Regulation does not apply: the High Court’s argument is circular. In Linder and in Maletic, the CJEU upheld the application of Brussels I even though competing jurisdiction elsewhere in the EU was only potential, not actual. Given the potential for jurisdiction with courts in France and Italy, I would suggest the Lindner logic applies.
Eady J though applies forum non conveniens to establish Scotland as the more appropriate forum in the UK, and to stay the English case.
He then obiter (had FNC not applied), at 86 ff suggests the court develop a novel sub-national model of Shevill, such that only courts of the sub-national place where the publisher is domiciled would have jurisdiction to award global damages – and all other courts within the United Kingdom would be restricted to awarding damages for harm occurring within their relevant regions. Importantly, even for post-Brexit use, Eady J suggest the importation of CJEU case-law in applying English law of conflicts is appropriate for Parliament has approved rules in parallel to those under the Recast Regulation.
A little gem of a judgment.
(Handbook of) EU Private international law, 2nd ed. 2016, Chapter 2, Heading 126.96.36.199.
The Court held some weeks ago in C-194/16 Bolagsupplysningen OÜ on the application of the Shevill rule, as supplemented by e-Date advertising, to infringements of a company’s personality rights over the internet. I held back reporting on the case for exam reasons – yep, some of the places I teach at already have exams.
Judgment was issued in Grand Chamber. There can be no clearer indication of the relevance the Court attaches to the question. The CJEU introduces in my view further complication in the Article 7(2) rule (jurisdiction for torts) by requiring the court seized carry out analysis of ‘main economic activity’ with those same courts being told not to get carried away however in that analysis. The judgment does not I believe offer a solid conclusion for the issues of removal and rectification.
An Estonian company operating in Sweden was blacklisted for its allegedly questionable business practices on the website of a Swedish employers’ federation. The website attracted a number of hostile comments from its readers. The Estonian company brought an action before the Estonian courts against the Swedish federation. It complained that the published information has negatively affected its honour, reputation and good name. It asked the Estonian courts to order that the Swedish federation rectify the information and remove the comments from its website. It also requested damages for harm allegedly suffered as a result of the information and comments having been published online.
Can the Estonian courts assert jurisdiction to hear this action on the basis of the claimant’s ‘centre of interests’, a special ground of jurisdiction that the Court previously applied to natural persons, but so far not legal persons? If they can, then second, how should the centre of interests of a legal person be determined? Third, if the jurisdiction of the Estonian courts were to be limited to situations in which the damage occurred in Estonia, the referring court wonders whether it can order the Swedish federation to rectify and remove the information at issue.
I reviewed Bobek AG’s Opinion here – let me recap core issues: Bobek AG suggested there are two novelties in the questions referred: a legal person (not a natural one) is primarily asking for rectification and removal of information made accessible on the internet (and only secondarily for damages for the alleged harm to its reputation). This factual setting, the AG suggests, leads to the question of how far the seemingly quite generous rules on international jurisdiction previously established in Shevill with regard to libel by printed media, and then further extended in eDate to the harm caused to the reputation of a natural person by information published on the internet, may be in need of an update.
At the real root of course of the generous rules on jurisdiction for tort, lies the Court’s judgment in Bier. Bobek AG joined Szpunar AG in severely questioning the wisdom of the Bier rule (both locus delicti commissi and locus damni lead to jurisdiction) in the age of internet publications. Not unexpectedly, the Court of Justice further refined Bier, but did not overrule it.
It held first of all that legal persons like natural persons can claim for damages in their centre of interests (at 38): the split in Bier was introduced for reasons of judicial suitability (‘sound administration of justice’), not personal interest of the plaintiff hence the qualification of that plaintiff has no bearing on the rule.
Following e-Date, the national court therefore needs to determine a centre of interests for a legal person just as it would for a natural person. At 41: for legal persons, this centre of interests ‘must reflect the place where its commercial reputation is most firmly established and must, therefore, be determined by reference to the place where it carries out the main part of its economic activities. While the centre of interests of a legal person may coincide with the place of its registered office when it carries out all or the main part of its activities in the Member State in which that office is situated and the reputation that it enjoys there is consequently greater than in any other Member State, the location of that office is, not, however, in itself, a conclusive criterion for the purposes of such an analysis.’ As one knows from the definition of ‘domicile’ under the Brussels I Regulation, leading to positive jurisdictional conflicts (it is perfectly possible for more than one Member State considering itself the domicile of a corporation), it is far from self-evident to determine where a company’s ‘main’ economic activities are located.
At 43 the Grand Chamber reminds the national courts that their role in the application of the Brussels I Recast is limited to the jurisdictional stage: they must not go into the merits (yet), hence if it is ‘not clear from the evidence that the court must consider at the stage when it assesses whether it has jurisdiction that the economic activity of the relevant legal person is carried out mainly in a certain Member State’, the Court must conclude that the Article 7(2) locus damni for the full damage is not available to that claimant.
The Court then distinguishes actions for rectification of false information and removal of comments: there is no jurisdiction before the courts of each Member State in which the information published on the internet is or was accessible. The Court follows Bobek AG’s Opinion on this point (although the AG also employed it to support his view on withdrawal of Bier altogether) at 48: ‘in the light of the ubiquitous nature of the information and content placed online on a website and the fact that the scope of their distribution is, in principle, universal …an application for the rectification of the former and the removal of the latter is a single and indivisible application and can, consequently, only be made before a court with jurisdiction to rule on the entirety of an application for compensation for damage [the Court refers to Shevill and e-Date] and not before a court that does not have jurisdiction to do so.’
On this latter point, the judgment is bound to create a need for further clarification: Shevill and e-Date confirm full jurisdiction for the courts of the domicile of the defendant, and of the locus delicti commissi, and of the centre of interests of the complainant. These evidently do not necessarily coincide. With more than one court having such full jurisdiction I do not see a solution in the Court’s approach.
(Handbook of) European Private International Law, 2nd ed. 2016, Chapter 2, Heading 188.8.131.52.
Right to be forgotten v Right to know. In Townsend v Google Inc and Google UK the Northern Irish High Court emphasises public interest in open justice.
In  NIQB 81 Townsend v Google Inc. & Anor the Northern Ireland High Court refused service our of jurisdiction in relation to a request for Google (UK and Inc.) to de-list a number of urls relating to reports on sexual and other criminal offences committed by plaintiff.
Plaintiff seeks an injunction inter alia requiring the defendants and each of them to withdraw and remove personal data relating to the plaintiff, making reference to or tending to reveal sexual offences committed by the plaintiff while a child, from their data processing and indexing systems and to prevent access to such personal data in the future. The Court references ia Vidal-Hall and Google Spain. I will leave readers to digest the ruling largely for themselves for there is a lot in there: consideration of Article 8 ECHR; Directive 95/46; aforementioned precedent; tort law etc.
Of particular note is Stephens J’s finding at 61 that ‘(t)here is a clear public interest in open justice. There is a clear right to freedom of expression. In such circumstances the processing was not unwarranted and that there is no triable issue in relation to any allegation that Google Inc. has not satisfied this condition.’
A judgment to add to the growing pile of internet, jurisdiction and balancing of interests in privacy considerations.