Litigation
LexInter | September 17, 2019 | 0 Comments

Litigation

The rules of jurisdiction for the settlement of disputes in international trade

In an international dispute, the question is whether the parties have decided, either in the contract or when the dispute arises, to resort to arbitration. Otherwise the dispute will be settled by recourse to a state court.

Recourse to state jurisdiction

International disputes pose the problem of international jurisdiction determining whether a national court can be seized. This question is a matter of private international law, the determination of internal jurisdiction then arises.

Rules for determining state jurisdiction

Common law rules of jurisdiction

For the convenience of the defendant, to avoid exposing him to the plaintiff’s initiatives until the merits thereof have been decided, the traditional rule is that the competent court is that of the defendant’s domicile. .

Extension of the rules of internal territorial jurisdiction to international jurisdiction

In French private international law, the internal rules of jurisdiction are extended to the international order (Civ. 19 Oct. 1959, Rev. crit. 1969.215, n. YL, D. 1969.37 n. Holleaux). As soon as the dispute with France to attribute jurisdiction to a specific French jurisdiction, the French courts may hear it.

The most common rules are as follows

  • domicile of the defendant or, if this defendant has no domicile in France or abroad, the defendant’s residence
  • in the event of a misdemeanor or quasi-delict place of the causal event or place where the damage was suffered
  • in contractual matters place of actual delivery of the item or service
  • when the defendant is a company located at the registered office but also at the secondary establishment
  • extension of jurisdiction to related requests

Privileged jurisdiction based on the French nationality of the parties

Article 14 of the French Civil Code enshrines what has been called the privilege of jurisdiction allowing the French to be tried by a French court, including when he is a plaintiff. This rule is however set aside by many treaties.

Competence related to the presence of assets

Jurisdiction rules resulting from international conventions

The 1968 Brussels Convention
The Brussels Convention applies “in civil and commercial matters” with the exception of the following matters – in commercial matters

  • bankruptcy, composition and other similar proceedings
  • social Security
  • arbitration

it being specified that it does not apply in civil matters to the following matters

  • the condition and capacity of natural persons
  • matrimonial regimes
  • wills and estates

The general principle is that the application of conventional rules when the defendant is domiciled in one of the contracting states. However, the rules of exclusive jurisdiction apply on the sole condition that the state they designate is one of the contracting states.

In addition, the rules regarding the voluntary prorogation of jurisdiction apply when the court chosen by the parties is that of a contracting state.

non-exclusive jurisdiction rules

These rules are applicable if the defendant in the action is domiciled in the territory of one of the member states. The seat of legal persons is assimilated to their domicile, and is determined according to the rules of private international law of the court seised.

The criteria of privilege of jurisdiction (Articles 14 and 15 for France) cannot be invoked against defendants domiciled in the territory of a state party to the convention to attract them to France.

The fundamental rule is that of the domicile of the defendant, which domicile is determined according to the law of the court seised.

Article 5 of the Convention also supplements this rule in certain matters,) namely in business law

contracts

In contractual matters, the jurisdiction is that of the court of the place where the obligation which serves as the basis of the action must be performed.

misdemeanors

In tort, the jurisdiction is that of the place where the harmful event occurred.

Any claim which aims to bring into play the responsibility of the defendant, and which does not relate to the contractual matter, is of a tort nature ( Kalfelis judgment , CJCE 27 Sept 1988, Rev. crit. 1989.112 n. Gaudemet Tallon, D. 1989 Som . 254 obs. B. Audit)

In matters of counterfeiting and press offenses, the request can be made either in the country of the author of the offense or in each of the countries where the distribution has caused damage ( husband Wegmann , CJCE July 16, 1997, JDI 1998.136 obs. Huet )

Articles 7 to 15 establish rules of protection (consumer, insured) and in particular the consumer has the choice of bringing either before the court of the domicile of the co-contracting party or before the court of his own domicile.

exclusive jurisdiction rules

The Convention establishes a certain number of rules of exclusive jurisdiction depending on the matter which cannot be exempted from the Convention.

These are the following disputes with the corresponding jurisdiction rules

  • real property rights and building leases fall within the competence of the building’s situation report
  • disputes relating to the validity, invalidity or dissolution of a company come under the jurisdiction of the head office
  • the validity of entries in public registers rests with the courts of the state where the registers are kept
  • disputes relating to the registration or validity of patents, trademarks, designs or similar rights fall within the jurisdiction of the state of filing or registration. On the other hand, disputes concerning contracts for the exploitation of intellectual rights and infringement actions are not concerned by this rule (CJCE 15 Nov. 1983, Rev. crit. 1984.361)

rules regarding the colontary prorogation of jurisdiction

The parties may, apart from the rules of exclusive jurisdiction or the rules of protection, derogate from these rules of jurisdiction, either by clauses conferring jurisdiction, or during the trial.

jurisdiction clauses

Article 17 of the Convention applies if the court designated by the clause is that of a Contracting State or if at least one of the parties is domiciled at the time of the conclusion of the agreement in the territory of the one of the Contracting States.

The parties can appoint the court of their choice, even if it has no connection with the dispute (“neutral court”)

Formal conditions are necessary for the validity of the clause. It is valid in the following cases

  • if it appears in the agreement or if an express reference is made in the agreement signed to the general conditions which contain it and known to the co-contracting party before signing it
  • in the event of a verbal agreement confirmed in writing if the verbal agreement expressly relates to the clause and if the written confirmation has not been objected to in good time
  • if the clause has been concluded in a form in accordance with the uses between the parties, or in a form accepted in the customs of international trade for this type of contract and in the commercial branch in question, and that the parties know or are supposed to know

tacit extension

If the defendant does not contest jurisdiction there is tacit extension. The appearance to challenge jurisdiction, even if it is followed in the alternative by submissions on the merits, does not constitute acceptance.

1998 Lugano Convention

The Lugano Convention was negotiated between the countries of the EEC and those of the EEA so that the commercial relations of all the member states of the EEA and the EEC are governed by the rules of the Brussels Convention. .

The rules of the Lugano Convention are practically identical to those of the Brussels Convention, the significant exception being that of individual employment contracts. Article 5-1 ° of the Lugano Convention allows both the employer and the employee to bring proceedings before the court of the place of employment when the work is not usually performed in the same country. Moreover, article 17 renders ineffective the clauses conferring jurisdiction concluded prior to the origin of the difference.

 

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