The Hague Convention on Choice of Court Agreements is the result of negotiations that began at The Hague Conference on Private International Law in 1992, when the United States asked for the Conference to develop a convention on jurisdiction and judgments.  A more comprehensive convention, which spanned the field of civil jurisdiction, was produced in draft form in 1999, and then revised in 2001.  This draft convention proved unsatisfactory to a number of countries, including the United States, and so a less ambitious convention was attempted.  The Choice of Courts Convention is the result.

The Choice of Courts Convention was concluded in mid-2005. Its fundamental aim is to improve the international enforcement of judgments made by courts that have been chosen by parties to commercial transactions.  As a result, the Choice of Courts Convention is a ‘double convention’ that gives common rules of jurisdiction and common rules for the enforcement of judgments between Convention countries.  The rules of jurisdiction themselves aim to improve the effectiveness of forum selection agreements, and therefore to give greater certainty and predictability to international commercial transactions and international trade.

The Colloquium 

The Choice of Courts Convention has been presented as either an important step towards securing the harmonisation of rules of jurisdiction for international commercial and trading relationships or – compared with the draft convention of 1999 – a consolation prize of limited scope and use.  This Colloquium will explore the significance of the Choice of Courts Convention, examine its implications for other areas of transnational law, and investigate legal questions that it raises – in general and specifically for Australia. 

The Colloquium is being held at the Law School, University of Southern Queensland, Toowoomba, Australia, on Friday 3 October 2008.  Nine scholars of private international law and transnational law will be giving papers (see the Colloquium Program below).  Anyone interested in attending should contact Ms Mary Ann Armstrong: armstrog@usq.edu.au

Colloquium Program

• The Choice of Courts Convention: Background and Negotiations – Professor Paul Beaumont, School of Law, University of Aberdeen
• The Choice of Courts Convention:  Is it Worth Implementing? – Professor Richard Garnett, The Melbourne Law School, University of Melbourne
• Exceptions under the Choice of Courts Convention – Associate Professor Mary Keyes, Law School, Griffith University
• The Choice of Courts Convention and the Exclusion of Maritime Claims – Dr Craig Forrest, TC Beirne School of Law, University of Queensland
• The Choice of Courts Convention and the Vienna Convention on the International Sale of Goods (CISG) – Dr Des Taylor, School of Law, University of Southern Queensland
• The Choice of Courts Convention – How will it work in relation to the Internet and e-commerce? – Associate Professor Dan Svantesson, Faculty of Law, Bond University
• The Hague and The Ditch: The Choice of Courts Convention and the Australia-New Zealand Treaty on Jurisdiction and Judgments – Professor Reid Mortensen, Law School, University of Southern Queensland.
• Enforcement of Judgments under the Choice of Courts Convention – Dr Anthony Gray, School of Law, University of Southern Queensland, Springfield 
• Res Judicata and Forum Shopping under the Choice of Courts Convention – Mr Justin Hogan-Doran, Wentworth Cambers, Sydney

Prof. Russell J Weintraub (University of Texas at Austin, School of Law) has published an interesting article on the Rome II Regulation in the latest issue of the Texas International Law Journal (Summer 2008): “The Choice-of-Law Rules of the European Community Regulation on the Law Applicable to Non-Contractual Obligations: Simple and Predictable, Consequences-Based, or Neither?” (43 Tex. Int’l L.J. 401).

The introductory paragraph reads as follows:

The European Community Regulation on the Law Applicable to Non-Contractual Obligations (“Rome II”) will take effect on January 11, 2009. This regulation is part of a widespread effort to draft new choice-of-law rules. For example, in 2007 a new conflict-of-laws code took effect in Japan. China is drafting a comprehensive civil code, which includes choice-of-law rules. What should be the objectives of these drafting projects? Should the new rules, as law-and-economics scholars urge, be simple and afford clearly predictable results? Or should choice-of-law rules endeavor to select the jurisdiction that experiences the consequences when the chosen law is applied? A third possibility is to draft rules that provide substantial predictability and are likely to be consistent with a consequences-based approach. Rome II falls into this third category: reasonably predictable results that are likely to give effect to the policies of the jurisdiction that will experience the consequences when the chosen law is applied.

There is now an extensive law-and-economics literature devoted to choice of law. Sections II and III summarize this economics approach to drafting conflicts rules and evaluate Rome II under this perspective. Sections IV and V outline a consequences-based approach to choice-of-law and appraise the extent to which Rome II is consistent with this methodology.

And here’s the conclusion:

Rome II provides reasonably foreseeable answers to choice-of-law issues. The various exceptions to the regulation’s rules create the major predictability problems: (1) the cryptic “more closely connected” exception that appears in the general rule of article 4 and in several other articles, (2) the “public policy” exception of article 26, and (3) the “mandatory provisions” exception of article 16. The uncertainty caused by these exceptions can be alleviated by (1) replacing the “more closely connected” language with a reference to the country that will experience the consequences if its law is not applied; (2) providing that if a court refuses on “public policy” grounds to apply the law that Rome II selects, the court is not to seize this excuse to apply its own law, but is to dismiss without affecting the plaintiff’s ability to sue elsewhere; and (3) giving some guidance as to what can qualify as internationally “mandatory” forum law.

The common residence exception to application of the law of the place of damage is partially, but insufficiently, consequences oriented. Rome II gets high marks for including time limitations and burden of proof within the scope of its rules. If it is to achieve its main purpose of making the result independent of the forum, Rome II should clearly indicate that quantification of damages is also within its scope.

The article can be downloaded from the Journal’s website.

Another interesting article on Rome II has been written by Prof. Weintraub at an earlier stage of the regulation’s legislative procedure, and was presented at a seminar hosted in March 2005 by the European Parliament’s Rapporteur Diana Wallis: “Discretion Versus Strict Rules in the Field of Cross-Border Torts“. It is available for download, along with papers by other prominent scholars who took part in the seminar, on Diana Wallis’ website (Rome II seminars’ page).

A slightly revised version, under the title “Rome II and the Tension between Predictability and Flexibility”, has been also published in Rivista di diritto internazionale privato e processuale (2005, no. 3, p. 561 ff.).

Our conference on the Rome I Regulation: New Choice of Law Rules in Contract, to take place at Herbert Smith’s offices in London on 19th September 2008, is now accredited with CPD by both the Solicitors Regulation Authority (5.5 hours) and the Bar Standards Board (5 hours).

The full programme, as well as the details on fees and booking, can be found on our dedicated conference page. The speakers are all internationally recognised experts in the fields of private international law, insurance e-commerce and IP, and financial services. The keynote speech is to be delivered by The Honourable Mr Justice Richard Plender, Royal Courts of Justice.

If you intend to attend, then I strongly suggest you book now, as places are limited. Hope to see you there.

Stefan Leible and Matthias Lehmann (both University of Bayreuth, Germany) have published an article on the Rome I Regulation: “Die Verordnung über das auf vertragliche Schuldverhältnisse anzuwendende Recht (“Rom I”). The article has appeared in the August issue of the German legal journal Recht der Internationalen Wirtschaft (RIW), 2008, pp. 528-544.

The authors have kindly provided the following English abstract:

The article provides an in-depth-analysis of the Regulation. It covers each of its provisions, starting from the scope of application to the relationship with other Community instruments. Major problems are highlighted, such as the application of consumer law (Art. 6), overriding mandatory provisions (Art. 9) or the law governing assignment and subrogation (Art. 14). A number of practical examples is used to illustrate the workings of the Regulation’s rules. The authors do not spare their criticism. For instance, they portray the treatment of insurance contracts (Art. 7) as overly complex and unsatisfactory. The Regulation’s provision allowing the application of certain foreign mandatory provisions (Art. 9 para 3) is criticized for not achieving the intended results.

See with regard to Rome I also our previous posts which can be found here.

The Court of Appeal for Ontario has released its decision in Precious Metal Capital Corp. v. Smith (available here).  In many ways the decision is unexceptional: it agrees with a quite sensible decision by the judge at first instance.  But there may be a more interesting, and contentious, aspect to the decision in the way the court has expressed its reasons.

The defendants had raised four separate objections to the litigation proceeding in Ontario: (1) the claims advanced against foreign defendants did not fit within the procedural rules allowing for service outside the province, (2) the court lacked jurisdiction because there was not a real and substantial connection between the dispute and Ontario, (3) the court lacked jurisdiction because the claim concerned foreign land (the Mocambique rule), and (4) if the court had jurisdiction, it should order a stay based on forum non conveniens.   Getting to the right result on each of these objections was not difficult – they all failed both before the motions judge and the Court of Appeal.

The point of interest was in the analysis adopted by the Court of Appeal.  The motions judge had separately considered objections (2) and (3).  In contrast, the Court of Appeal held that issues related to the remedy being sought (in respect of foreign land) should, in cases involving foreign defendants, not be analyzed separately.  Rather, they should be subsumed as part of the court’s analysis of whether there was a real and substantial connection to Ontario (see paras. 15-18 among others).

This works no evils in this particular case, but I question the benefit of running issues (2) and (3) together.  The latter has tended to be a separate question for two reasons: it focuses on subject-matter jurisdiction rather than jurisdiction over the defendant, and as an issue it can arise whether the case is one of service in or service out.  To me it seems a cleaner analysis to continue to treat these as distinct questions rather than running them together.

Does running them together, for example, make it possible for the court to conclude it has jurisdiction even in a case squarely involving title to foreign land and not falling within the historic Penn v. Baltimore exception, based on other elements of the Muscutt test for a real and substantial connection?  Is this then a signal that the Mocambique rule itself is under threat?