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New Book: Recognition of Judgments in Contravention of Prorogation Agreements

Written by Felix M. Wilke, Senior Lecturer at the University of Bayreuth, Germany.

Must a foreign judgment be recognised in which a jurisdiction agreement has been applied incorrectly, i.e. in which a court wrongly assumed to be competent or wrongly declined jurisdiction? Within the European Union, the basic answer is a rather straightforward “yes”. Recognition can only be refused on the grounds set forth in Article 45(1) Brussels Ibis Regulation, and unlike Article 7(1)(d) of the recently adopted HCCH Judgments Convention, none of them covers this scenario. What is more, Article 45(3) Brussels Ibis expressly states that the jurisdiction of the court of origin, save for certain instances of protected parties, may not be reviewed, not even under the guise of public policy.

Why, then, should one bother to read the book by Niklas Brüggemann, Die Anerkennung prorogationswidriger Urteile im Europäischen und US-amerikanischen Zivilprozessrecht (Mohr Siebeck) on the recognition of judgments in contravention of prorogation clauses in European and US-American law? The first and rather obvious reason can be found in the second part of the title. The book contains a concise, yet nuanced overview of the law of jurisdiction agreements in the US (in German). To the knowledge of this author, it has been 12 years since the last comparable work was published (Florian Eichel, AGB-Gerichtsstandsklauseln im deutsch-amerikanischen Handelsverkehr (Jenaer Wissenschaftliche Verlagsgesellschaft) – which dealt with recognition only in passing and was limited to German and US law). Thus, this new book can be recommended to anyone with sufficient command of the German language who is interested in this particular aspect of US civil procedure, whose concepts – if one even dares to use that term – partly differs from European ideas.

The second and main reason to concern oneself with Brüggemann’s book, however, is his proposition for a new ground of refusal of recognition: a new Article 45(1)(e)(iii) Brussels Ibis for which he even offers a draft. To this end, the author comprehensively analyses jurisdiction agreements within the Brussels Ibis framework. While Article 31(2) Brussels Ibis, one of the main innovations of the Recast, has indeed “enhance[d] the effectiveness of exclusive choice-of-court agreements” (Recital 22 Brussel Ibis), Brüggemann argues that the Regulation still safeguards jurisdiction agreements insufficiently. He points out several situations (e.g. asymmetrical agreements, mere derogation agreements) that Article 31(2) Brussels Ibis does not cover in the first place. He also argues in some detail that the court first seised is allowed to examine the jurisdiction agreement in question with regard to the existence of an agreement and its formal validity; its assessment would be binding upon other courts in line with Gothaer Allgemeine (ECJ Case C-456/11). This in turn would lead to a race to the courts and even to a race between the courts. (The latter metaphor is only partially convincing, for it is unlikely that the judges will intentionally accelerate their respective proceedings in order to “beat” the other court.)

Brüggemann goes on to argue that when it comes to jurisdiction agreements it is contradictory to make an exception to the principle of mutual trust in the lis pendens context but to strictly adhere to it in the recognition context. He demonstrates that, in particular, default judgments by a derogated court pose a significant risk for the defendant – one with which US civil procedure arguably deals more effectively. Alas, this appears to be the only instance in which the author’s comparative analysis, as interesting it is in and of itself, contributes to his broader point. He concludes by pointing out parallels to jurisdiction in insurance/consumer/employment matters (safeguarded at the stage of recognition by Article 45(1)(e)(i) Brussels Ibis) and exclusive jurisdiction (safeguarded at the stage of recognition by Article 45(1)(e)(ii) Brussels Ibis), and by suggesting that a special ground for refusal of recognition would have positive effects on the internal market.

While the abovementioned Judgments Convention is too recent to feature in the book, the author was able to consider its draft in a separate, albeit somewhat oddly positioned, chapter. Conspicuously absent is any specific discussion of the issue of damages for the violation of a choice of court agreement (see this recent post). The omission is certainly justifiable as Brüggemann is only concerned with procedural safeguards for jurisdiction agreements. But maybe such a remedy under substantive law could obviate or at least lessen the need for a separate ground of refusal of recognition? All in all, however, the author has carefully built a compelling case for an addition to Article 45(1) Brussels Ibis.

Staying Proceedings under the Civil Code of Quebec

Written by Professor Stephen G.A. Pitel, Western University

The decision of the Supreme Court of Canada in R.S. v P.R., 2019 SCC 49 (available here) could be of interest to those who work with codified provisions on staying proceedings. It involves interpreting the language of several such provisions in the Civil Code of Quebec. Art. 3135 is the general provision for a stay of proceedings, but on its wording and as interpreted by the courts it is “exceptional” and so the hurdle for a stay is high. In contrast, Art. 3137 is a specific provision for a stay of proceedings based on lis pendens (proceedings underway elsewhere) and if it applies it does not have the same exceptional nature. This decision concerns Art. 3137 and how it should be interpreted. Read more

HCCH Event on the HCCH Service Convention in the Era of Electronic and Information Technology and a few thoughts

Written by Mayela Celis

The Permanent Bureau of the Hague Conference on Private International Law (HCCH) is organising an event entitled HCCH a / Bridged: Innovation in Cross-Border Litigation and Civil Procedure, which will be held on 11 December 2019 in The Hague, the Netherlands. This year’s edition will be on the HCCH Service Convention.

The agenda and the registration form are available here. The deadline for registrations is Monday 11 November 2019. The HCCH news item is available here.

A bit of background with regard to the HCCH Service Convention and IT: As you may be aware, the Permanent Bureau published in 2016 a Practical Handbook on the Operation of the Service Convention (available for purchase here), which contains a detailed Annex on the developments on electronic service of documents (and not only with regard to the Service Convention). In that Annex, developments on the service of documents by e-mail, Facebook, Twitter, etc. and its interrelationship with the Service Convention were analysed.  Not surprisingly, cases where electronic service of process was used were rare under the Service Convention (usually, the physical address of the defendant is not known, thus the Service Convention does not apply and the courts resort to substituted service).

A more important issue, though, appears to be the electronic transmission of requests under the Service Convention. According to a recent conclusion of the HCCH governance council, it was mandated that:

Electronic transmission of requests

“40. Council mandated the Permanent Bureau to conduct work with respect to the development of an electronic system to support and improve the operation of both the Service and Evidence Conventions. The Permanent Bureau was requested to provide an update at Council’s 2020 meeting. The update should address the following issues: whether and how information technology would support and improve the operation of the Conventions; current practices on the electronic transmission of requests under the Conventions; legal and technological barriers to such transmission and how best to address these; and how a possible international system for electronic transmission would be financed. “

In contrast, the European Union seems to be at the forefront in encouraging electronic service of documents as such, see for example the new proposal for Regulation on the service of judicial and extrajudicial documents in civil or commercial matters, click here (EU Parliament, first reading).

Article 15a reads as follows:

“Electronic service

1. Service of judicial documents may be effected directly on persons domiciled in another Member State through electronic means to electronic addresses accessible to the addressee, provided that both of the following conditions are fulfilled: [Am. 45]

(a) the documents are sent and received using qualified electronic registered delivery services within the meaning of Regulation (EU) No 910/2014 of the European Parliament and of the Council, and [Am. 46]

(b) after the commencement of legal proceedings, the addressee gave express consent to the court or authority seized with the proceedings to use that particular electronic address for purposes of serving documents in course of the legal proceedings. [Am. 47].”

By adding the word “both” the European Parliament seems to restrict electronic service to documents after service of process has been made (see previous European Commission’s proposal). This, in my view, is correct and gives the necessary protection to the defendant. In the future and with new IT developments, this might change and IT might be more widely used by all citizens (think of a government account for each citizen for the purpose of receiving government services and service of process -although service of process comes as a result of private litigation so this might be sensitive-), and thus this might provide more safeguards. In my view, the key issue in electronic service is to obtain the consent of the defendant (except for cases of substituted service).

News

Chinese Journal of Transnational Law (Vol. 1, Issue 1) was released

The first issue of the Chinese Journal of Transnational Law (Vol.1 Issue 1, 2024) was recently published by SAGE. It includes three articles relevant to private international law.

Consensus and Compulsion: The Extra-territorial Effect of Chinese Judicial and Specially-Invited Mediation in Common Law Countries, Jie (Jeanne) Huang
This article conducts exhaustive research on case law in major common law jurisdictions (Australia, Canada, Hong Kong, New Zealand, Singapore, the UK, and the US) regarding the recognition and enforcement of Chinese judicial mediation decisions (MTS). In contrast to the rich literature criticizing the systematic deficiency of Chinese judicial mediation where an adjudicator plays the dual role of mediator and judge in the same case and the consequent injustice to the parties, the deficiency is not an issue currently in recognition and enforcement of MTS in common law jurisdictions. Why is this so and what would be the future trend? Answering these questions, this article explores the recent expansion from judicial mediation to Specially-Invited Mediation at the people’s courts in China and discusses whether the features of Specially-Invited Mediation impact the recognition and enforcement of MTS at the common law jurisdictions. It also addresses controversies on applicable law, challenges to the enforceability of civil liability clauses, debates on the finality of MTS, and recognition and enforcement of MTS under China’s judicial assistance agreements, the Hague Choice-of-Court Convention, the Hague Judgments Convention, and the Singapore Mediation Convention.

Read more

2024 Inaugural Edition of the UNCITRAL Days in the Arab Sates

The UNCITRAL secretariat is pleased to announce that the inaugural edition of the UNCITRAL Days in the Arab Sates is planned for 2024!

The UNCITRAL Days activities comprise academic gatherings organized with universities and institutions of higher learning in the region, which discuss and consider issues arising in UNCITRAL’s areas of work, i.e. the progressive harmonization and modernization of international commercial law through the adoption, use and implementation of legal texts. The events seek to raise awareness of UNCITRAL instruments and the of legal harmonization amongst the next generations of academics and policymakers.

This series of events will be held between 15 April – 31 December 2024 under the following theme: “The role of UNCITRAL in the modernization of international trade law in the Arab States”.

Information regarding the organization of an event within the framework of the UNCITRAL Days in the Arab States in 2024 can be found in the attached document in Arabic and English language.

If your institution is interested in organizing an event, simply fill out the form available at https://forms.office.com/e/nZifBytPsC or by scanning the QR code below.

The secretariat will contact you afterwards to discuss practicalities.

Who’s Afraid of Punitive Damages? – Conference in Augsburg, Germany

by Salih Okur (University of Augsburg)

On 8 and 9 March, scholars from more than a dozen different jurisdictions followed the invitation of Tobias Lutzi to discuss recent trends in punitive damages at the University of Augsburg, Germany. Despite an unfortunate combination of rail and flight strikes, only a small number of participants were ultimately unable to make it to Augsburg. While their presence was dearly missed, the option of participating in the conference online meant that nothing stood in the way of more than 50 scholars of private and private international law devoting the next 26 hours to critically discuss whether and to what extent a strict refusal to recognise foreign punitive damage awards – as notably upheld in Germany – was still tenable in light of international developments.

The conference contained five panels overall, which were split into three blocks. It was kicked off by Tobias Lutzi and Marc Lendermann (Federal Ministry for Digital and Transport, Germany), who underlined the continued relevance of punitive damages as a research topic, despite the German Federal Court of Justice’s landmark decision from 1992 (BGHZ 118, 312), which appears to have stopped claimants from seeking enforcement of punitive damage awards in Germany. It evidently has not stopped claimants from seeking enforcement of punitive damage awards in other civil law legal systems. As the conference would highlight on the second day, some legal systems, including Italy, France, and South Korea, which originally refused to recognise foreign decisions on grounds similar to those of the German Federal Court of Justice (BGH), have abandoned their strict refusal and adopted a more nuanced approach. This constant flow of international change and developments alone makes it worthwhile to keep the academic conversation going.

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