I. Judgments on Brussels I:

1. SCT Industri AB i likvidation v. Alpenblume AB (C-111/08)

The Högsta domstolen (Sweden) had referred the following question to the ECJ for a preliminary ruling:

Is the exclusion under Article 1(2)(b) of Regulation [No 44/2001] of bankruptcy, proceedings relating to the winding-up of insolvent companies or other legal persons, judicial arrangements, compositions and analogous proceedings from the scope of that regulation to be interpreted as meaning that it covers a decision given by a court in one Member State (A) regarding registration of ownership of shares in a company having its registered office in Member State A, the shares having been transferred by the liquidator of a company having its registered office in another Member State (B), where the court based its decision on the fact that, in the absence of an international agreement on the mutual recognition of insolvency proceedings, Member State A does not recognise the liquidator’s powers to dispose of property situated in Member State A?

The ECJ now held:

The exception provided for in Article 1(2)(b) of Council Regulation No 44/2001 (EC) of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters must be interpreted as applying to a judgment of a court of Member State A regarding registration of ownership of shares in a company having its registered office in Member State A, according to which the transfer of those shares was to be regarded as invalid on the ground that the court of Member State A did not recognise the powers of a liquidator from a Member State B in the context of insolvency proceedings conducted and closed in Member State B.

See with regard to this case also our previous post on the reference which can be found here.

2. Peter Rehder v. Air Baltic Corporation (Case C-204/08)

The Bundesgerichtshof (Germany) had referred the following questions to the ECJ for a preliminary ruling:

1.      Is the second indent of Article 5(1)(b) of Regulation [No 44/2001] to be interpreted as meaning that in the case also of journeys by air from one Member State to another Member State, the single place of performance for all contractual obligations must be taken to be the place of the main provision of services, determined according to economic criteria?

2.      Where a single place of performance is to be determined: what criteria are relevant for its determination; is the single place of performance determined, in particular, by the place of departure or the place of arrival of the aircraft?

The ECJ now held:

The second indent of Article 5(1)(b) 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, in the case of air transport of passengers from one Member State to another Member State, carried out on the basis of a contract with only one airline, which is the operating carrier, the court having jurisdiction to deal with a claim for compensation founded on that transport contract and on Regulation (EC) No 261/2004 of the European Parliament and of the Council of 11 February 2004 establishing common rules on compensation and assistance to passengers in the event of denied boarding and of cancellation or long delay of flights, and repealing Regulation (EEC) No 295/91, is that, at the applicant’s choice, which has territorial jurisdiction over the place of departure or place of arrival of the aircraft, as those places are agreed in that contract.

See with regard to this case also our previous post on the reference which can be found here.

II. References: Further, several questions on the interpretation of Brussels I – as well as one reference on Brussels II bis – have been referred to the ECJ for a preliminary ruling:

1. Ceská podnikatelská pojišt’ovna, a.s., Vienna Insurance Group v Michal Bílas(Case C-111/09)

The Okresní Soud v Cheb (Czech Republic) has referred the following questions to the ECJ for a preliminary ruling:

Should Article 26 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 (‘the Regulation’) be interpreted as not authorising a court to review its international jurisdiction where the defendant partipates in the proceedings, even when the case is subject to the rules on compulsory jurisdiction under Section 3 of the Regulation and the application is brought contrary to those rules?

Can the defendant, by the fact that he partipates in the proceedings, establish the international jurisdiction of the Court within the meaning of Article 24 of the Regulation even where the proceedings are otherwise subject to the rules of compulsory jurisdiction in Section 3 of the Regulation and the application is brought contrary to those rules?

If the answer to question (2) is in the negative, may the fact that the defendant participates in the proceedings before a court which otherwise under the Regulation does not have jurisdiction in a case concerning insurance, be regarded as an agreement on jurisdiction within the meaning of Article 13(1) of the Regulation?

2.Hotel Alpenhof GesmbH v. Oliver Heller (Case)C-144/09)

The Oberster Gerichtshof (Austria) has referred the following question to the ECJ for a preliminary ruling:

Is the fact that a website of the party with whom a consumer has concluded a contract can be consulted on the internet sufficient to justify a finding that an activity is being ‘directed’, within the terms of Article 15(1)(c) of Regulation (EC) No 44/2001 (‘the Brussels I Regulation’)?

3. Ronald Seunig v. Maria Hölzel (Case C-147/09)

The Oberlandesgericht Wien (Austria) has referred the following quesitons to the ECJ for a preliminary ruling:

1. (a) Is the second indent of Article 5(1)(b) 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 (‘Regulation No 44/2001’) applicable in the case of a contract for the provision of services also where the services are, by agreement, provided in several Member States?

If the answer to that question is in the affirmative,

Should the provision referred to be interpreted as meaning that

(b) the place of performance of the obligation that is characteristic of the contract must be determined by reference to the place where the service provider’s centre of business is located, which is to be determined by reference to the amount of time spent and the importance of the activity;

(c) in the event that it is not possible to determine a centre of business, an action in respect of all claims founded on the contract may be brought, at the applicant’s choice, in any place of performance of the service within the Community?

2. If the answer to the first question is in the negative,

Is Article 5(1)(a) of Regulation No 44/2001 applicable in the case of a contract for the provision of services also where the services are, by agreement, provided in several Member States?

4. Peter Pammer v. Reederei Karl Schlüter GmbH & Co. KG (C-585/08)

This reference, made by the Oberster Gerichtshof (Austria) concerns first the interpretation of “a contract which, for an inclusive price, provides for a combination of travel and accomodation” in terms of Art. 15 No. 3 Brussels I and second the question whether it is sufficient to assume that activities are “directed” to a certain Member State if a website can be consulted via the internet.

Those questions have arisen in this case between a claimant domiciled in Austria and a company having its seat in Germany. The claimant booked a sea voyage on a freighter with the sued company via the website of an agent seated in Germany. As submitted by the claimant, the offer should – according to the agent’s website – include inter alia a cabin for two persons with bath room, separate living room, TV, further a gym and a swimming pool. In addition, several shore leaves should be encompassed as well.  According to the claimant’s submission, most of these statements were incorrect why the claimant declined to start the journey and sues for repayment before Austrian courts.

Thus, the first question arising in this case is the question of international jurisdiction of Austrian courts. Art. 15 No. 3 Brussels I, however, states that Section 4 – which would, in principle, be relevant due to the existence of a consumer contract – is not applicable to contracts of transport other than a contract which, for an inclusive price, provides for a combination of travel and accomodation. Consequently, Section 4 is applicable with regard to package travel – which raises the question whether the present contract can be regarded as package travel.

Since the Austrian Supreme Court had doubts as to whether the present contract can be compared with a cruise – which is classified as package travel by the predominant opinion – it has referred the following question to the ECJ:

Does a ‘voyage by freighter’ constitute package travel for the purposes of Article 15(3) 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?

If the answer to Question 1 is in the affirmative: Is the fact that an agent’s website can be consulted on the internet sufficient to justify a finding that activities are being ‘directed’ within the terms of Article 15(1)(c) of Regulation No 44/2001?

The referring decision of the Austrian OGH can be found (in German) here.

5. Wood Floor Solutions Andreas Domberger GmbH v. Silva Trade, SA (C-19/09)

Futher, the Oberlandesgericht Wien (Austria) has referred to the ECJ interesting questions on the interpretation of Art. 5 No. 1 (b) Brussels I with regard to cases where the services are provided in several Member States:

1. (a) Is the second indent of Article 5(1)(b) of Council Regulation (EC) No 44/201 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (‘Regulation No 44/2001’) applicable in the case of a contract for the provision of services also where the services are, by agreement, provided in several Member States?

If the answer to that question is in the affirmative,

Should the provision referred to be interpreted as meaning that

(b) the place of performance of the obligation that is characteristic of the contract must be determined by reference to the place where the service provider’s centre of business is located, which is to be determined by reference to the amount of time spent and the importance of the activity;

(c) in the event that it is not possible to determine a centre of business, an action in respect of all claims founded on the contract may be brought, at the applicant’s choice, in any place of performance of the service within the Community?

2. If the answer to the first question is in the negative: Is Article 5(1)(a) of Regulation No 44/2001 applicable in the case of a contract for the provision of services also where the services are, by agreement, provided in several Member States?

6. German Reference on Brussels II bis

Further, the Bundesgerichtshof has referred with decision of 10 June 2009 a question on the interpretation of Brussels II bis to the ECJ for a preliminary ruling: The case concerns the question whether provisional measures in terms of Art. 20 Brussels II bis constitute “judgments” in terms of Art. 2 No. 4 Brussels II bis and thus whether provisional measures can be recognised under Artt. 21 Brussels II bis et seq.

As stated by the Bundesgerichtshof, this question is debated controversially by legal writers and there is no constant jurisdiction so far. Consequently, the Bundesgerichtshof decided to refer the following question to the ECJ:

Are Articles 21 et. seq. Regulation (EC) No. 2201/2003 (Brussels II bis) also applicable with regard to provisional measures concerning the rights of custody in terms of Art. 20 Brussels II bis?

(Approximate translation from the German decision. The case is apparently not available at the ECJ’s website so far, but can be found (in German) under XII ZB 182/08 at the website of the Federal Court of Justice).

Many thanks to Jens Karsten (Brussels) for the tip-off with regard to several of these cases.

Update: As we have been kindly informed by Professor Christian Kohler, the reference has been received by the ECJ in the meantime and is pending under C-256/09 (Purrucker).

Trevor Hartley (LSE) has published a new textbook entitled, International Commercial Litigation: Text, Cases and Materials on Private International Law, published by Cambridge University Press. Here’s the blurb:

This carefully structured, practice-orientated textbook provides everything the law student needs to know about international commercial litigation. The strong comparative component provides a thought-provoking international perspective, while at the same time allowing readers to gain unique insights into litigation in English courts. Three important themes of the book analyse how the international element may call into question the power of the court to hear the case, whether it should exercise this power, whether foreign law applies, and whether the court should take into account any foreign judgement. Hartley provides the reader with extracts from leading cases and relevant legislation, together with an extensive reference library of further reading for those who wish to explore the topic in more detail, making this a valuable, single-source textbook. The title will benefit from a companion website, setting out all relevant case law developments for the students.

• Substantial extracts for leading cases are set out, so students can get an insight into how judges think • Also included is other material on jurisdictions, especially the United States • Extensive reading list after each chapter • Companion website will update material to reflect most recent case law developments

It is available in both paperback (£48.00) and hardback (£90.00) from the CUP website, or you can purchase it from our Amazon-powered bookshop for the bargain prices of £45.50 and £85.50 respectively (click on those cheaper prices to go directly to the book on the Amazon website.)

Recently, the July/August issue of the German legal journal “Praxis des Internationalen Privat- und Verfahrensrechts” (IPRax) was released.

It contains the following articles/case notes (including the reviewed decisions):

• Anatol Dutta: “Das Statut der Haftung aus Vertrag mit Schutzwirkung für Dritte” – the English abstract reads as follows:

The autonomous characterisation of national legal institutions is one of the challenging tasks of European private international law. This article attempts to determine the boundaries between the Rome I and the Rome II Regulation with regard to damages of third parties not privy to the contract but closely connected to one of the parties. Notably, German and Austrian law vest contractual rights in such third parties, especially in order to close gaps in tort law. It is argued here that those third party rights, although based on contract according to national doctrine, are to be characterised as a non-contractual obligation and governed by the Rome II regime (infra III). Under Rome II, in principle, the general conflict rule for torts in Art. 4(1) applies; if the damage suffered by the third party is caused by a product, the liability towards the third party is subject to the special rule in Art. 5(1) (infra IV). Hence, the law governing the contract from which the third party rights are derived plays only a minor role (infra V): for those third party rights neither the special rule for culpa in contrahendo in Art. 12(1) – insofar as pre-contractual third party rights are concerned – nor the escape clauses in Art. 4(3) and Art. 5(2) lead to the law which governs the contract.

• Ivo Bach: “Neuere Rechtsprechung zum UN-Kaufrecht” – the English abstract reads as follows:

The number of case law on the CISG increases exponentially. Thanks to online databases such as the one of Pace University or CISG-online a majority of cases are internationally available. The rapid increase of case law, however, complicates the task of staying up to date in this regard. This contribution shall be the first of a series that summarises the recent developments in case-law and at the same time categorises the cases in regard to their topic and in regard to their importance. The series aligns with the date the respective decisions become available to the general public, i. e. the date they are published on the CISG-online database, rather than the date of the decision. This contribution covers the cases with CISG-online numbers 1600–1699.

• Alice Halsdorfer: “Sollte Deutschland dem UNIDROIT-Kulturgutübereinkommen 1995 beitreten?” – the English abstract reads as follows:

The ratification of the UNESCO Convention on the Means of Prohibiting and Preventing the Illicit Import, Export and Transfer of Ownership of Cultural Property 1970 is the perfect occasion to raise the question whether or not Germany should strive for an additional ratification of the UNIDROIT Convention on Stolen or Illegally Exported Cultural Objects 1995. While many contracting states of the UNESCO Convention 1970 did not implement comprehensive return claims for illegally exported cultural objects, the self-executing UNIDROIT Convention 1995 provides such claims and in addition further claims for stolen cultural objects. One of the major difficulties is the absence of provisions on property rights. It may be argued an initial lack or intermediate loss of ownership should not affect return claims for cultural objects with the consequence that the last possessor has to be considered the rightful claimant. Further, it may be argued that the return of cultural objects includes necessarily a transfer of possession but not a transfer of property. However, the return of cultural objects to the state from which these cultural objects have been unlawfully removed may influence the applicable law and indirectly affect property rights. Since this effect is achieved only under the condition that the lex rei sitae is replaced by the lex originis, it might be advisable to extend the scope of the ss 5 (1), 9 of the German Law on the Return of Cultural Objects in the event of a future ratification of the UNIDROIT Convention 1995.

• Martin Illmer: “Anti-suit injunctions zur Durchsetzung von Schiedsvereinbarungen in Europa – der letzte Vorhang ist gefallen” – the English abstract reads as follows:

Yet another blow for the English: the final curtain for anti-suit injunctions to enforce arbitration agreements within the European Union has fallen. As the augurs had predicted, the ECJ, following the AG’s opinion, held that anti-suit injunctions enforcing arbitration agreements are incompatible with Regulation 44/2001. Considering the previous judgments in Marc Rich, van Uden and Turner as well as the civil law approach of the Regulation, the West Tankers judgment does not come as a surprise. It accords with the system and structure of the Regulation. De lege lata the decision is correct. Moaning about the admittedly thin reasoning and an alleged lack of convincing arguments does not render the decision less correct. Instead, the focus must shift to the already initiated legislative reform of Regulation 44/2001. Meanwhile, one may look for alternatives within the existing system to hold the parties to the arbitration (or jurisdiction) agreement, foreclosing abusive tactics by parties filing actions in certain Member States notorious for protracted court proceedings.

• Matthias Kilian: “Die Rechtsstellung von Unternehmensjuristen im Europäischen Kartellverfahrensrecht”
  The article reviews the judgment given by the European Court of First Instance in the joined cases T-125/03 and T-253/03 (Akzo Nobel Chemicals Ltd. and Akcras Chimcals Ltd. ./. Commission of the European Communities) which can be found here.

• Rainer Hüßtege: “Der Europäische Vollstreckungstitel in der Praxis”
  The article reviews a decision by the Higher Regional Court Stuttgart (23.10.2007 – 5 W 29/07) dealing with the requirements of a European Enforcement Order Certificate in terms of Art. 9 Regulation (EC) No. 805/2004 stating that the issue of the ceritificate requires according to Art. 6 No. 1 (c) inter alia that the court proceedings in the Member State of origin met the requirements as provided for the proceeding of uncontested claims. This requirement was not met in the present case since the summons was not served in accordance with Art. 13 (2) of the Regulation.

• Christoph M. Giebel:  “Die Vollstreckung von Ordnungsmittelbeschlüssen gemäß § 890 ZPO im EU-Ausland” – the English abstract reads as follows:

Under German law, the State is exclusively responsible for enforcing contempt fines issued by German courts. Thus, the State collects the contempt fine through its own public authorities ex officio. This approach is in contrast to the legal situation in several other EU Member States that allow the judgment creditors not only to decide upon the enforcement of the contempt fine but also to keep the funds obtained through the enforcement. In terms of EU cross border enforcement, it is commonly accepted that for example a French “astreinte” may be enforced in Germany by invoking Art. 49 of the Regulation (EC) No. 44/2001. However, it is still doubtful whether or not German judgment creditors could similarly enforce a German contempt fine in another EU Member State. These doubts were recently intensified by a resolution rendered by the Higher Regional Court of Munich on 3rd December 2008 – 6 W 1956/08 – (not res judicata). The Higher Regional Court of Munich has refused to confirm a contempt fine issued by the Regional Court of Landshut as a European Enforcement Order under the Regulation (EC) No. 805/2004. The Higher Regional Court of Munich basically argues that the judgment creditor has no legitimate interest to apply for such confirmation due to the German legislator having attributed the responsibility for the enforcement exclusively to the State. The arguments put forward by the Higher Regional Court of Munich would also rule out any cross border enforcement of German contempt fines according to the rules of the Regulation (EC) No. 44/2001. This would lead to a considerable disadvantage of German judgment creditors within the Common Market. In the article, the author discusses in detail the arguments put forward by the Higher Regional Court of Munich both from a German and European Community law perspective. The author comes to the conclusion that prior-ranking European Community law demands that German contempt fines may also be enforced in other EU Member States both on the basis of the Regulations (EC) No. 44/2001 and No. 805/2004. In reconciling the requirements of European Community and German law, the author proposes that the judgment creditor shall be entitled to act on the basis of a representative action for the State. The funds obtained through the enforcement in the relevant EU Member State shall therefore invariably be paid to the relevant State treasury in Germany.

• Felipe Temming: “Zur Unterbrechung eines Kündigungsschutzprozesses während des U.S.-amerikanischen Reorganisationsverfahrens nach Chapter 11 Bankruptcy Code”
  The article reviews a judgment of the German Federal Labour Court (27.02.2007 – 3 AZR 618/06) dealing with the interruption of an action for protection against dismissal according to the reorganization proceedings under Chapter 11 U. S. Bankruptcy Code.

• Kurt Siehr: “Ehescheidung deutscher Juden”
  The article reviews a judgment of the German Federal Court of Justice (28.05.2008 – XII ZR 61/06) concerning in particular the question whether divorce proceedings before a Rabbinical Court in Israel lead to the result that the plea of lis alibi pendens has to be upheld in German divorce proceedings. As stated by the Federal Court of Justice this could only be the case if the Jewish divorce could be recognised in Germany. This was answered in the negative by the Federal Court of Justice under the given circumstances confirming its previous case law according to which a divorce before a Rabbinical Court constitutes an extra-judicial divorce – and not a sovereign act – which can, under German law, only be recognised if the requirements of the law applicable according to German PIL (Art. 17 EGBGB) are satisfied.  Due to the fact that in the present case German law was applicable with regard to the divorce according to Art. 17 EGBGB, this was not the case.

• Frank Spoorenberg/Isabelle Fellrath: “Offsetting losses and profits in case of breach of commercial sales/purchase agreements under Swiss law and the Vienna Convention on the International Sale of Goods”

This contribution analyses the computation of damages that may be awarded in order to compensate the buyer for the losses incurred on the substitution transactions as a result of the seller’s default in a commercial sales/purchase agreement. It discusses more specifically the possible compensation of substitution and additional losses with any profits incurred on a single substitution transaction, and on successive substitution transactions, focusing on the articulation of the international and Swiss law provisions governing general losses and substitutions losses. Reference is made by ways of illustration to a recent unpublished ICC arbitration award addressing the issue from a set off perspective.

• Dirk Otto: “Formalien bei der Vollstreckung ausländischer Schiedsgerichtsentscheidungen nach dem New Yorker Schiedsgerichtsabkommen” – the English abstract reads as follows:

The author criticises a decision of Austria’s Supreme Court which required a party seeking to enforce a foreign arbitration award in Austria to submit a legalised original or certified/legalised copy of the arbitration award although the defendant never disputed that a submitted simple copy was authentic. The author submits the correct approach would have been to require compliance with the formalities of Art. IV of the New York Convention only if (i) defendant disputes the authenticity of a copy or (ii) the enforcing court has to pass default judgment as only in these situations there is a genuine need to prove the conformity of documents.

• Götz Schulze: “Anerkennung von Drittlandscheidungen in Frankreich” – the English abstract reads as follows:

The author analyses two judgments of the French Court of Cassation pertaining to the incidental recognition of foreign divorce decrees under French law. In the first case, a Moroccan wife had filed for divorce in France. The conciliation hearings were opposed by the husband, who claimed that the marriage had already been dissolved by a final Moroccan divorce decree. The second case regarded a French married couple who had been resident in Texas. Upon separation, the husband returned to France, where he filed a petition for divorce. The admissibility of the latter was contested because divorce proceedings were already pending in Texas, which finally led to a final divorce decree. Since the cases did not fall within the scope of the Brussels II Regulation, French procedural law was applicable. In both cases, the question at stake was whether the courts had to take into account the foreign judgments when assessing the admissibility of the divorce petition. The Court of Cassation answered in the affirmative. It held that national courts have to determine the recognition of foreign divorce decrees in every stage of the procedure as an incidental question. It thereby overruled an earlier judgment, according to which the recognition of foreign judgments was reserved for the “juge de fond” and could not be determined in conciliation hearings or summary proceedings. It also held that recognition could not be denied for reasons beyond the three exhaustive grounds of non-recognition established under French law, which are lack of international jurisdiction, misuse of rights, and public policy. In the second case, the lower court had denied recognition because the divorce decree had not been registered with the register office. The reported judgments herald an important shift in French procedural law and were unanimously welcomed by legal writers. Not only did the Court of Cassation interpret national civil procedural law in a manner as to align it with art. 21 (4) Brussels II Regulation. It also overcame the long criticised procedural privileges for French nationals. As the court made clear, art. 14 Code of Civil Procedure, which grants to every French national an international venue within the domestic territory, cannot be read as to inversely hinder the recognition of a foreign judgment.

Futher, this issue contains the following information:

• The new German choice of law rules as amended due to the adaptation to Regulation (EC) No. 593/2008 (Rome I) which are applicable from 17 December 2009: “Das EGBGB in der ab 17.12.2009 geltenden Fassung”

• Erik Jayme/Carl Friedrich Nordmeier report on two PIL conferences held in Lausanne:  “Zwanzig Jahre schweizerisches IPR-Gesetz – Globale Vergleichung im Internationalen Privatrecht”

• Ralf Michaels/Catherine H. Gibson report on the conference held at Duke Law School on 9 February 2008 titled: “The New European Choice-of-Law Revolution: Lessons for the United States?”

• Hilmar Krüger reports on the wife’s right of succession under Iranian law: “Neues zum Erbrecht der überlebenden Ehefrau nach iranischem Recht”

• Hilmar Krüger reports on the recognition of foreign decisions in the field of family law in Turkey: “Zur Anerkennung familienrechtlicher Entscheidungen in der Türkei”

French courts do not have contempt power. When they issue injunctions, the only available tool that they have to ensure compliance is astreinte. Astreinte is a pecuniary penalty which typically accrues per day of non-compliance. For instance, a French commercial court may order a party to do something or to refrain from doing something under a penalty of 1,000 euros per day of non-compliance.

Obviously, astreinte puts pressure on the defendant to comply. However, such pressure is only indirect. If the defendant does not comply, he will not be physically forced to. But he may be ordered to pay millions of euros instead, which can certainly be compelling. So this begs the question: does astreinte belong to enforcement? If it does, this could have a variety of consequences as far as private international international law is concerned.

In this first post, I would like to examine the interaction between astreinte and sovereign immunities.

Read more