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Jurisdiction Under Brussels I Regulation 2 Notes

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JURISDICTION UNDER BRUSSELS REGULATION 2 Tort In matters relating to tort, delict or quasi-delict, jurisdiction is given to the courts where the harmful occurred or may occur. Issue 1 - Is there a contract?
? Yes, then go to Art 7(1)
? No, then go to Art 7(2) Issue 2 - Is it a tort or delict?
? Art 7(2): in matters relating to tort, a person who is domiciled in a MS may be sued in another MS in the courts for the place where the harmful event occurred or may occur. o Not tort if restitution o Not tort if no harmful event occurred
? Rudolph Gabriel: Art 7(2) covers all liability which is not contractual
? Strict liability torts - fault is not required Definition

i) ii)

? 'Tort' has autonomous community meaning.
? Tort covers any proceedings which attempt to show liability of D; but which does not involve matters relating to a contract.
- Kalfelis v Bankhaus Schroder [1988]
? English courts have diverted from this viewpoint.
? stated that unjust enrichment - which seems to be a 'harm' - was not 'harmful event'.
? Kleinwort Benson v Glasgow City Council [1997]
? ECJ's view is correct one.
? Whether event is 'harmful' as per Article 7(3) may be determined by national law of courts seised.
? Shevill v Presse Alliance [1996]

Place Where Harmful Event Occurred 1)

i) ii)

Multiple Localities

? Sometimes D's wrongful act is committed in one place, and the harm occurs in another.
? Here the 'harmful event' as per Art 7(3) occurs either at: Place where damage occurs; or Place of event giving rise to damage
- GJ Bier v Mines de Potasse d'Alsace [1976]
? Thus C may choose to sue in either jurisdiction.
? GJ Bier v Mines de Potasse d'Alsace [1976]i)

Product liability - Kainz v Pandawaerke AG (2014) o Austrian went biking and was injured in Germany. Bicycle wasn't properly manufactured. Wanted to bring claim in Austria, where harmful event occurred. Bike was bought in Germany o Held: place where harmful event occurred was where manufacturer made product (i.e. Germany).

Place where damage occurs

?Place in which damage occurs is place where actual harm is or would be inflicted.
? e.g. for sale of defective goods, this is place in which 'initial damage occurs as result of normal use of product for purpose for which it was intended'
? and not place in which defective good was manufactured
? Zuid-Chemie BV [2010]
For defamation, this is where C's reputation is damaged by defamatory material
? Shevill [1996]

Examples of harmful event

1) Infringement of foreign copyright to fall within Art 7(2) - Pearce v Ove Arup Partnership Ltd 2) Equitable claim for dishonest assistance - Casio Computer Co v Sayo (No.3) 3) Claim for pre-contractual liability - Founderie Officine Meccaniche Tacconi SpA v Heinrich Wagner
? Argument: claim based on the Italian Civil Code requiring good faith in the negotiation and formation of contract
? Basis of claim was not contractual as duty to negotiate existed whether or not the contract was eventually concluded. Cannot fall under Art 7(1).
? Defamation - harmful event is where thing was published.
? Internet libel (eDate): o Domicile o Harmful event o Centre of interests (restricted to Internet)

Indirect loss'Place in which damage occurs' does not include indirect damage
? i.e. if D caused damage in State A which results in loss for C in State B, C must sue in place where harm was inflicted on him (State A)
? and NOT where this harm resulted in loss for C (State B)

? Must be direct damage: Where harm is inflicted is not the same as place where injury is suffered (Reunion v Splietoff)
? Dumez France SA v Hessische Landesbank o Facts: French company suffers loss because German subsidiary becomes insolvent due to negligent advice of German bank. o Held: French courts have no jurisdiction under Art 7(2). Event giving rise to damage directly produces harmful effects on immediate victims (i.e. Germany), even though it is in France that claimant suffers injury.
? Marinari v Lloyds Bank o Facts: Italian claimant has suffered financial loss in Italy consequential upon initial damage arising from D's refusal to return promissory notes which claimant has deposited in England. o Held: no jurisdiction on Italian court; England is where damage occurred.
? Dolphin Maritime & Aviation Services v Sveriges Forening o Claimant failed to receive payment to which he was entitled ? harm suffered o Therefore, where harm takes the form of failure to receive payment, harm occurs where the payment should have been made.
? Zuid Chemie v Philippos

o

ii)

Do not interpret in favour of C's domicile or in favour of D's domicile - interpretation is narrow.

Place of event giving rise to damage
? Normally easy to know where event giving rise to damage took place.
??????For defamation, this is where defamatory material is published
? Shevill [1996]

Misrepresentation?

2)

For misrepresentation, place of event giving rise to damage is place where D makes the misrepresentation
? and NOT where C hears/receives the misrepresentation.
? Domicrest v Swiss Bank [1999] (UK case)
- thus if misrepresentation is made via telephone by someone in France to someone in UK, harmful event occurs in France NB place in which damage occurs will still be place in which C suffers loss as a result of relying upon misrepresentation
? this usually where C hears and relies on representation
? Domicrest v Swiss Bank [1999]

Distinct TortsWhere events constitute distinct torts, C may sue in every jurisdiction in which a distinct tort has occurred.
? however when suing in particular jurisdiction , C may only recover for harm caused by torts in that jurisdiction.
? Shevill v Presse Alliance [1996]Internet libel
? eDate Advertising v X o Following rules are limited to internet publishing and damage of privacy rights
? Facts: Sunday Mirror published item on English website saying Kylie Minogue and boyfriend got together.
? Held: where harmful event had occurred was: o Where D is domiciled or o Where D is established (no articulation as to difference between that and domicile) o Where claimant has centre of his/her interests (i.e. habitual residence of claimant)
? Also possible to sue in third Member State in respect of damage caused in the territory of that particular Member State using Shevill.

Claims in Contract and Tort?

ECJ: where there are claims arising from same event for both breach of contract and tort, claims must be separated.
? i.e. both can be brought, but must be done in separate proceedings
? Kalfelis v Bankhaus Schroder [1988]
UK: UK courts have however diverted from this viewpoint.
? suggested that where breach of contract gives rise to claims in contract and in tort, case is simply one for breach of contract
? i.e. if English courts do not have jurisdiction under Article 7(1) to hear the contractual claims, they are automatically prevented from hearing the tort claims
? Source Ltd v TUV Rheinland [1998]

Thus under Source view, claims in tort can only be heard if they fall outside the scope of contract

?e.g. a tort covering damage separate to that under contract (economic torts) may be possible for C to sue someone else for tortious liability, and then have D joined as a codefendant (thus evading Source problem)

?? ?Duty to take reasonable care: Source Ltd v TUV Rheinland Holding AG
? Facts: German defendants agreed with the English claimants to inspect goods in the Far East and send report to claimants in England where monies were to be released to pay for the goods.
? Claimants: argued that Ds didn't take reasonable care in production of reports
? Held, C of A, it did not have jurisdiction. Tortious claim related to contract, even though contract did not have to be pleaded for it to exist.
? Therefore, fell within Article 7(1) not Article 7(2).

Activities of a Branch, Agency Etc. Article 7(5)
??????Courts of a Member State have jurisdiction over D where: i) the dispute relates to the operation of D's branch, agency, or other establishment ii) and where relevant branch/agency/other establishment is situated in that Member State
??????For this to be case, D itself must also be domiciled in a Member State (though not necessarily one in which branch etc. operates) Thus D, a French company, may be sued in England where it has a branch in England, and the dispute relates to tort/breach of contract committed by that branch. "Branch, Agency or Other Establishment"

i) ii) iii) iv)

??????Key characteristic is whether branch/agency is subject to direction or control of D.
? De Bloos [1978]
??????This test then refined in Blanckaert; i.e. for something to constitute D's branch/agency etc., needs to be: permanent place of business in fixed place; subject to direction and control of D; with a certain autonomy from D; and able to act on behalf of D
- Blanckaert & Willems v Trost [1981]
??????Thus must be shown the business is acting on behalf of D, and not simply for its own benefit.
??????Subsidiary may be 'branch' merely if it appears to third parties that subsidiary is acting on behalf of parent
? even where the two companies are legally independent of each other
? Schotte v Perfums Rothschild [1987]
Dispute Relating to Operation of Branch etc.?

i) ii)

Jurisdiction under Article 7(5) limited to "disputes arising out of the operations of that branch". Relevant operations are any undertakings entered into or incurred by branch on behalf of D which either: fall to be performed by branch itself; or fall to be performed elsewhere (e.g. by D)
? For activities to be those of branch, suffices that there is sufficient nexus between branch and dispute in question.
? i.e. so that it is natural to describe dispute as one arising from activities of branch
? Anton Durbeck [2003]

1) For tort, no need for harmful event to have actually occurred in Member State in which branch is situated
? provided tort arose out of some activity of branch, does not matter even if harmful event occurred outside EU
- Anton Durbeck [2003]

?

whether tort actually arose from operations of D's branch depends on facts of case.
- Anton Durbeck [2003]

2) For contracts, no need for obligation to fall to be performed in Member State in which branch is situated.
? i.e. provided there is sufficient nexus between dispute and branch, does not matter where the contractual obligation falls to be performed (even if this is outside EU)
? Lloyds Register of Shipping [1995]

Additional Parties
?????Article 6 gives various circumstances in which jurisdiction may be obtained through joining D to proceedings. 1)

i) ii)

Multiple Defendants

Article 8(1)
? Allows claimant to join a co-defendant to a proceedings.
? Only possible for C to co-join additional defendant(s) where: the additional D is domiciled in a Member State; and there is an "anchor" defendant.
- **i.e. one of the joint defendants must be being sued in their own domicile (i.e. under Article 2 jurisdiction)**i) ii)

Article 8(1): Joinder allowed where claims are so closely connected that they need to be heard together to avoid risk of irreconcilable judgments in separate proceedings.
? For this to be case, must be a risk of both: divergence in outcome of dispute that arises in context of same situation of law and fact
- Freeport v Arnoldsson [2007] (ECJ)
? When ascertaining whether there has been divergence in law and fact, national court must look at all the factors.
? Freeport v Arnoldsson [2007]
? Relevant factor in deciding question is law governing the respective contracts.
? E.g. if C's contracts with D1 and D2 are both governed by English law, joinder of D2 more likely to be granted
? Gard Marine and Energy v Glacier Reinsurance [2011]
Legal Basis??

No need for claims to have same legal basis.
? provided there is sufficient connection between claims, can be joinder even if one claim is in contract, and the other in tort
? Freeport v Arnoldsson [2007]
Had previously been ruled by ECJ that both claims had to have same legal basis.
? Reunion Europeenne [2000]
English courts had criticised the view in Reunion Europeenne
? Watson v First Choice Holidays and Flights Ltd [2001]
However matter now resolved by Freeport

Tactical Use2)

Article 8(1) can be used where C uses it for sole purpose of removing a defendant from courts of his domicile.
? i.e. where C sues D1 and then invokes Article 8(1) solely to prevent courts of D2's domicile having jurisdiction over D2.
? Freeport plc v Arnoldsson [2007]

Third Party Proceedings

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