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Is Tessili still good law?
by Felix M. Wilke, University of Bayreuth, Germany
Most readers of this blog will be well aware that, according to the ECJ, the “place of performance” of a contractual obligation within the meaning of Article 7(1)(a) Brussels Ibis is not a concept to be understood independently from national law. Rather, in order to determine this place, one must apply the substantive law designated by the forum’s conflict-of-law rules. The ECJ has held so for decades, starting with Tessili (Case C-12/76, ECLI:EU:C:1976:133, at 13). Recent decisions by the ECJ have led me to doubt that Tessili still is lex terrae Europaea, at least as far as contracts with some relation to a right in rem in immovable property are concerned. (And I am not alone: Just today, Marion Ho-Dac analyses this issue as well over at the EAPIL Blog.)
The applicability of Article 7(1)(a) Brussels Ibis in the context of co-ownership agreements
To begin with, it is necessary to establish what Article 7(1)(a) Brussels Ibis has to do with co-ownership agreements. Article 24(1) Brussels Ibis might appear to be the more natural jurisdictional rule in this context. But it does not suffice that a case has some connection to property law. Article 24(1) Brussels Ibis only applies if the action is based on a right in rem. The Court has been characterising rights as rights in rem independently from national law (a point I would agree with). The main feature of a right in rem is its effect erga omnes (Wirkung gegenüber jedermann; effet à l’egard de tous – see Case C-292/93, ECLI:EU:C:1994:241– Lieber, at 14). Thus, Art. 24(1) Brussels Ibis will not apply to a dispute concerning rights whose effect is limited to other co-owners and/or the association of co-owners. Rather, Article 7(1)(a) Brussels Ibis comes into play. The Court considers the corresponding obligations as freely consented to, as they ultimately arise from the voluntary acquisition of property, regardless of the fact that the resulting membership in the association of co-owners is prescribed by law (Case C-25/18, ECLI:EU:C:2019:376 – Kerr, at 27). This applies, e.g., to a co-owner’s payment obligation arising from a decision taken by the general meeting of co-owners.
From Schmidt to Ellmes Property
Kerr only concerned the question of whether Art. 7(1)(a) Brussels Ibis applies to such disputes at all. The Court had reasoned (to my mind quite correctly) in Schmidt (Case C-417/15, ECLI:EU:C:2016:881, at 39) earlier that an action based on the alleged invalidity of a contractual obligation for the conveyance of the ownership of immovable property is no matter falling under Article 24(1) Brussels Ibis. It then had gone beyond the question referred to it and stated that Article 7(1)(a) Brussels Ibis applies, noting that this contractual obligation would have to be performed in Austria (being the location of the immovable property in question). Ellmes Property (Case C-433/19, ECLI:EU:C:2020:900, reported on this blog here and here) now combines the two strands from Kerr and Schmidt. This recent case again concerns a dispute in the context of a co-ownership agreement. One co-owner sued the other for an alleged contravention of the designated use of the respective apartment building (i.e., letting an apartment out to tourists). If this designated use does not have effect erga omnes, e.g. cannot be relied on against a tenant, the CJEU would apply Article 7(1)(a) Brussels Ibis. But once again, the Court does not stop there. It goes on to assert that “[The obligation to adhere to the designated use] relates to the actual use of such property and must be performed in the place in which it is situated.” (at 44).
A Tessili-shaped hole in the Court’s reasoning
In other words, the Court seems at least twice to have determined the place of performance itself, without reference to the applicable law – even though there does not seem to be any pertinent rule of substantive law that the Court would have been competent to interpret. A reference to Tessili or any decision made in its wake is missing from both Schmidt and Ellmes Property. (In his Opinion on Ellmes Property, Advocate General Szpunar did not fail to mention Tessili, by the way.) And in Ellmes Property, the Court proceeds to argue that this very place of performance makes sense in light of the goals of Brussels Ibis and its Article 7 in particular. The Court thus uses jurisdictional arguments for a question supposedly subject to considerations of substantive law.
“Here’s your answer, but please make sure it is correct.”
Admittedly, the statement in Schmidt was made obiter, and the Court locates the place of performance only “subject to verification by the referring court” in Ellmes Property. The latter might be a veiled reference to Tessili. But why not make it explicit? Why not at least refer to the Advocate General’s opinion (also) in this regard? And why the strange choice of the word “verification” for question of law? But the Court has not expressly overruled Tessili. Furthermore, I do not want to believe that it has simply overlooked such an important strand of its case-law presented to it on a silver platter by the Advocate-General, one arguably enshrined in the structure of Article 7(1) Brussels Ibis, anyway. Hence, I (unlike Marion Ho-Dac, although I certainly agree with her as to the low quality of the judgment in Ellmes Property) still hesitate to conclude that Tessili must be disregarded from now on. This assumption, however, leads to one further odd result. While the referring court that had asked the ECJ for clarification of the place of performance does receive a concrete answer, it now has to check whether this answer is actually correct. Granted, it is not uncommon for the Court to assign certain homework to the referring court. Yet here, the former employed some new standard and tasked the latter to check whether the result holds up if one applies the old standard. I fail to see the point of this exchange between the national court and the Court of Justice.
(A full case note of mine (in German) on Ellmes Property, touching on this issue as well as others, is forthcoming in the Zeitschrift für das Privatrecht der Europäischen Union (GPR).)
A few takeaways of the Conclusions & Decisions of the HCCH governing body (CGAP): gender issues, Jurisdiction Project and future meetings
On 5 March 2021, the Conclusions & Decisions of the HCCH governing body, the Council on General Affairs and Policy (CGAP), were released. Click here for the English version and here for the French version.
Although there is a wide range of topics discussed, I would like to focus on three aspects: gender issues, the Jurisdiction Project and future meetings.
1) Today is International Women’s Day and there are important conclusions on gender issues. The Conclusions & Decisions No 52-54 read as follows:
“G. Geographic Representation
“52. Reaffirming the principles of universality and inclusiveness, CGAP reiterated its commitment to ensuring appropriate geographic representation at the HCCH. Recognising the importance of this issue, CGAP agreed to maintain this item on the agenda for its 2022 meeting. CGAP invited the PB to facilitate, within existing resources, informal consultations ahead of the 2022 meeting of CGAP, through in-person meetings, while ensuring the opportunity for any HCCH Member to participate.
53. In the context of this discussion, CGAP also recalled the importance of ensuring appropriate gender representation.
54. CGAP requested the PB to provide a historical overview of geographic and gender representation in the key bodies and groups of the Organisation ahead of the 2022 meeting of CGAP.” (our emphasis)
Awareness of gender representation is always a victory for everyone!
2) As you may know, a spin-off from the Judgments Project was the establishment of the Experts’ Group on the Jurisdiction Project. The purpose of this Group was to continue its discussions on “matters relating to direct jurisdiction (including exorbitant grounds and lis pendens / declining jurisdiction)”, “with a view to preparing an additional instrument”. It met 5 times.
A report of the Experts’ Group was presented to the CGAP. It includes an aide-mémoire of the Chair (Annex I) and a Summary of the Responses to the Questionnaire on Parallel Proceedings and Related Actions in Court-to-Court Cases (Annex II). See here the Report on the Jurisdiction Project.
Interestingly, three options on the possible types of future instrument(s) were discussed by the Experts’ Group but views were divided: [Option A] Binding instrument on direct jurisdiction, including on parallel proceedings; [Option B] Binding instrument on parallel proceedings, and a binding additional protocol on direct jurisdiction; [Option C] Binding instrument on parallel proceedings, and a non-binding instrument (e.g., model law, guiding principles, etc.) on direct jurisdiction (see page 5).
A clear and strong preference was expressed for Options A and C (experts were divided).
In my personal opinion Option C seems to be the more sensible option. As expressed by the experts favoring this option: “[…] with a common consideration being that diverse legal backgrounds and jurisdictional rules from around the world would make a binding instrument on direct jurisdiction difficult to conclude and to implement. These experts also noted that Option A may not be feasible due to existing differences in opinion of experts and considering past similar attempts. In this context, they considered it more useful to develop a soft law instrument on direct jurisdiction and were open to considering the viability of different types of soft law instruments such as a model law, principles, or guidelines. Given the need to deal with parallel proceedings in practice, they expressed a preference for developing a binding instrument on parallel proceedings.”
Following the conclusion of the work of the Experts’ Group on the Jurisdiction Project, a new Working Group on matters related to jurisdiction in transnational civil or commercial litigation was established, and Professor Keisuke Takeshita (Japan) was invited to chair the Working Group.
The Conclusion & Decision No 9 of the CGAP reads:
“9. In continuation of the mandate on the basis of which the Experts’ Group had worked, CGAP mandated:
a. The Working Group to develop draft provisions on matters related to jurisdiction in civil or commercial matters, including rules for concurrent proceedings, to further inform policy considerations and decisions in relation to the scope and type of any new instrument.
b. The Working Group to proceed in an inclusive and holistic manner, with an initial focus on developing binding rules for concurrent proceedings (parallel proceedings and related actions or claims), and acknowledging the primary role of both jurisdictional rules and the doctrine of forum non conveniens, notwithstanding other possible factors, in developing such rules.
c. The Working Group to explore how flexible mechanisms for judicial coordination and cooperation can support the operation of any future instrument on concurrent proceedings and jurisdiction in transnational civil or commercial litigation.
d. The PB to make arrangements for two Working Group meetings before the 2022 meeting of CGAP, with intersessional work, so as to maintain momentum. If possible, one meeting will be held after the northern hemisphere summer of 2021, and another in early 2022, with a preference, where possible, for hosting in-person meetings” (our emphasis).
3) With regard to future meetings, there are a few meetings in the pipeline, among them:
Special Commission meetings (SC – basically, a global meeting of experts)
- Special Commission on the practical operation of the 2007 Child Support Convention and its Protocol – postponed to March-June 2022
- Special Commission on the Apostille Convention + 12th e-APP Forum – to be held online in October 2021
- Special Commission on the practical operation of the 1993 Adoption Convention – postponed to July 2022
Edition 2021 of HCCH a|Bridged will focus on the 2005 Choice of Court Convention (incl. and “subject to available resources, the circulation of a brief questionnaire to elicit reasons as to why more States have not become party to the Convention”).
Recommendation in The Netherlands to suspend intercountry adoptions
The Committee Investigating Intercountry Adoption, has recommended that The Netherlands suspend intercountry adoptions. The interdisciplinary committee considered the history and legal evolution, and did an in-depth investigation into adoptions from five selected countries (Bangladesh, Brazil, Colombia, Indonesia and Sri Lanka). It looked into the consequences for the people involved (adoptees, birth families and adoptive families), the perception in society, the best interests of the child and the right to know one’s origins and identity. It came to the conclusion that there have been too many abuses and that the current system is still open to fraud and abuses. It further stated that the lessons learned should be applied to new methods of family formation such as surrogacy.
For those who do not read Dutch, the Commission issued a press release in English and published an English summary of the report.
The Committee, established by the Minister for Legal Protection, Mr. Sander Dekker, was chaired by Mr. Tjibbe Joustra and further composed of Prof. Dr. Beatrice de Graaf and Mr. Bert-Jan Houtzagers.
News
Giustizia consensuale No 1/2024: Abstracts
The first issue of 2024 of Giustizia consensuale (published by Editoriale Scientifica) has just been released, and it features:
Paolo Comoglio (Associate Professor at the University of Genoa), Giustizia forzata. Lo strano caso dell’offer to settle in Cassazione nel nuovo art. 380 bis c.p.c. (Forced Justice. The Strange Case of the Offer to Settle before the Court of Cassation pursuant to the New Article 380-bis of the Italian Code of Civil Procedure; in Italian).
This article examines the accelerated definition procedure for Cassation appeals pursuant to Article 380-bis of the Italian Code of Civil Procedure, as amended by the ‘Cartabia reform’. Beginning with an analysis of case law, the article critically explores the main questions of unconstitutionality surrounding Article 380-bis and the uncertainties that this peculiar procedural device poses.
Paola Licci (Researcher at the Università di Roma Tor Vergata), La centralità della giustizia consensuale nelle controversie di lavoro (The Centrality of Consensual Justice in Labor Disputes; in Italian)
This article examines the evolution of consensual justice in labor matters, beginning with the first form of conciliation provided by the law on probiviral tribunal and ending with the assisted negotiation introduced in labor disputes by the ‘Cartabia reform’. The analysis of these institutions reveals that consensual justice plays a fundamental role in resolving labor disputes, both due to the nature of the litigation and the inability of the justice system to offer effective (and differentiated) protection swiftly.
Out Now: Salvadori/Boutin (eds), Colombian Draft Project on Private International Law
EAPIL Winter School on Multistate Torts
The second edition of the EAPIL Winter School held annually in Como, Italy, will focus on Multistate Torts.
The event is organized by the University of Insubria in cooperation with the Jagiellonian University in Kraków and the University of Murcia and will feature English classes from about 20 international experts. It is aimed primarily at law graduates, law practitioners and PhD candidates with an interest in private international law, EU law and human rights law.
An online teaser seminar presenting the Winter School will take place on 2 December 2024, 6 p.m. CET. Those interested in participating in the online seminar are invited to send an email to eapilws@gmail.com in order to receive the link to the meeting.
In order to apply, interested candidates need to fill out this form.
The full programme can be found here, more information is also available here.