Tag Archive for: civil law

Implied Jurisdiction Agreements in International Commercial Contracts

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Authors: Abubakri Yekini (Lecturer in Conflict of Laws at the University of Manchester) and Chukwuma Okoli (Assistant Professor in Commercial Conflict of Laws at the University of Birmingham, Senior Research Associate at the University of Johannesburg).

A  Introduction

In an increasingly globalised economy, commercial transactions often involve business entities from different countries. These cross-border transactions present complex legal questions, such as the place where potential disputes will be adjudicated. To provide certainty, commercial parties often conclude ex ante agreements on the venue for dispute resolution by selecting the court(s) of a particular state. However, what happens if no such express agreement over venue is reached for resolving a contractual dispute? Could consent to the venue be implicitly inferred from the parties’ conduct or other factors?

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Publication: Galgano & Marrella, Diritto e Prassi del Commercio Internazionale

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Galgano-Marrella Diritto e Prassi del Commercio InternazionaleProf. Francesco Galgano (emeritus in the University of Bologna Law School
and founder of Galgano Law Firm) and Prof. Fabrizio Marrella (“Cà Foscari” University of Venice) have recently published “Diritto e Prassi del Commercio Internazionale” (CEDAM, 2010), vol. LIV of the “Trattato di Diritto Commerciale e di Diritto Pubblico dell’Economia“, one of the most authoritative Italian legal series, directed by Prof. Galgano.

A presentation has been kindly provided by the authors (the complete TOC is available on the publisher’s website):

The problems affecting cross-border transactions from a legal standpoint as well as arbitration have boomed in the last years. This book is the first systematic and accurate analysis of International Business Law updated to the most important reforms in the European Union such as: the Lisbon Treaty; Regulation Rome I on the law applicable to contractual obligations and Regulation Rome II on the law applicable to non contractual obligations. New competences for international trade negotiations have been attributed by Member States to the EU. Moreover, an entirely new choice of law regime has been introduced in the European Union affecting world international contracts and transnational arbitration. In addition,new instruments have been generated from the business side such as the new UCP 600 (the Uniform Customs and Practice for Documentary Credits, i.e. a set of rules on the issuance and use of letters of credit utilised by bankers and commercial parties in more than 175 countries in trade finance).

Beautifully written by two world reputed Authors in the field, the purpose of this work is to closely examine actors and sources of International Commercial Law with particular reference to contracts for the sale of goods and other forms of exports; licensing of intellectual property; and foreign direct investment.

Title: Diritto e Prassi del Commercio Internazionale, by Francesco Galgano and Fabrizio Marrella, CEDAM (series: Trattato di Diritto Commerciale e di Diritto Pubblico dell’Economia, vol. LIV), Padova, 2010, XLVIII-956 pages.

ISBN: 978-88-13-28228-8. Price: EUR 98.

Canadian National Class Action Judgment Not Recognized in Quebec

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The Supreme Court of Canada has confirmed the decision of the Quebec Court of Appeal in Canada Post Corp. v. Lepine (available here).  The decision flows from Canada Post’s termination, after only a year, of a lifetime internet service it sold to customers.  This led to class proceedings in Quebec and Ontario.  While aware of the proceedings in Quebec, the parties settled the class proceedings in Ontario in a judgment that purported to cover residents of Quebec.  When the Quebec proceedings continued (due to dissatifaction with what was obtained under the Ontario settlement) the defendant sought to have the Ontario judgment recognized in Quebec.

Recognition of foreign judgments in Quebec is governed by Art 3155 of the Civil Code, and so this case is very centrally concerned both with civil law (rather than common law) and with interpreting the specific provisions of the Code.  Art 3155 provides several bases for refusing to recognize a foreign judgment (see para. 22).  

The first issue is whether the Ontario court had jurisdiction to grant the judgment.  The Supreme Court of Canada devotes the most attention to this issue because it raises an interesting question within Quebec’s law on recognition.  Quebec uses the “mirror principle” for assessing jurisdiction, and so would consider whether the foreign court had taken jurisdiction in accord with Quebec’s own approach to taking jurisdiction.  That approach includes the doctrine of forum non conveniens.  So this raised the issue of whether the Quebec court could hold that, because Ontario did not stay the proceedings at least as they concerned residents of Quebec, it did not have jurisdiction in the sense contemplated by the Code (para. 27).  The Supreme Court of Canada rejects this approach: forum non conveniens issues are not to be considered in assessing the foreign court’s jurisdiction (paras. 34-37).  The Ontario court had jurisdiction.

The second issue is whether the Ontario judgment contravened fundamental principles of procedure.  Here the court holds that the class proceeding notices provided to residents of Quebec under the Ontario judgment were deficient.  On the facts, this is an understandable conclusion: there is no question that the notices could have been clearer, especially as concerned the relation between the Ontario and Quebec proceedings (para. 45).  This conclusion, in itself, is sufficient to resolve the case.

Third, Art 3155 provides a defence to recognition where essentially the same proceeding as that giving rise to the judgment is pending before the Quebec courts.  Canada Post had advanced its argument based on a somewhat technical distinction between a proceeding seeking certification for a class action and the subsequently-certified action (para. 53) but the court rejected this distinction (para. 54).  This aspect of the decision, interpreting Art 3155(4), could prove very important to the future of so-called national class actions in Canada, since it would then seem that as long as proceedings had started in Quebec, a decision from another province purporting to cover Quebec residents in the same class action would not be recognized in Quebec.  This gives residents of Quebec a protection residents of the other provinces do not have.

This is a welcome decision on the first issue, an understandable decision on the second issue, and a decision that requires more consideration on the third issue.