JURISDICTION UNDER BRUSSELS REGULATION 2

Tort

Shevill v Presse Alliance [1996] (ECJ)

Issue was whether a defamatory statement made by D was ‘harmful’ for purposes of Article 5(3). Held:

Whether something is a ‘harmful event’ is determined by national law (as chosen by conflict of law rules of courts seised).
Thus where matter falls to be judged by English law, whether event is harmful is a question of English law.
On facts, defamatory statements are presumed to be harmful in English law.

Thus they constitute a tort under Article 5(3)

Place Where Harmful Event Occurred

GJ Bier v Mines de Potasse

D, French company, discharged harmful chemicals into Rhine river. C, nursery owner in Holland, used polluted water on his plants which suffered harm as a result. Question was where C could sue D under Article 5(3). Held:

‘Harmful event’ as per Art 5(3) occurs either at:

Place where damage occurs
Place of event giving rise to damage

Thus C could sure D either in France (where pollution was put in river) or Holland (where harm to plants occurred).

Zuid-Chemie BV [2010]

D, Belgian company, manufactured a component used in manufacture of fertiliser. C, Dutch company, bought some of this component from D. Component was defective, causing the end-product fertiliser created by C to be ruined. Issue was over ‘place where the damage occurred’ – in Belgium (where the defective component was created by D), or in Holland (where the damage to C’s end-product occurred). Held:

‘Place in which damage occurred’ means place in which initial damage results from normal use of product for purpose for which it was intended.

as opposed to place in which defective product was manufactured.

Thus place in which the damage occurred is place in which defective component caused the damage to C’s fertiliser

Thus damage occurred in Holland, when component was mixed with the other ingredients.
And not in Belgium, where component was made and delivered to C.

Marinari v Lloyds Bank [1995]

D, an English bank, refused to return promissory notes that C, an Italian bank, had deposited in England. As result, C suffered economic loss in Italy. Held:

‘Harmful event’ as per Article 5(3) occurred in England.

i.e. D’s failure to return the promissory notes.

This despite fact that actual loss suffered by C was in Italy.
Thus Italian courts do not have jurisdiction under Art 5(3).

Place of Event Giving Rise to Damage

Domicrest v Swiss Bank [1999] (UK case)

C, an English company, accused D, a bank, of tort of negligent misstatement. As result of D’s misstatement as to creditworthiness of one of D’s client, C released goods in Italy and Switzerland which were then not paid for by the client. This caused C harm via loss of money in its bank accounts in UK. Issue was where ‘harmful event’ occurred. Held:

Place in which harmful event occurred is place in which misstatement was made.

And not place in which misstatement was received.

Form (i.e. email, telephone) by which statement is made to C is irrelevant

As it is D’s negligent words, and not C’s receipt of them, which constitutes the ‘harmful event’.
Thus irrelevant whether misstatement made in writing or via instantaneous communication.

Thus on facts:

Harmful event occurred in Switzerland (issuing of negligent misstatement)
Damage occurred in Switzerland (where goods were released by D)

this despite fact that D heard and acted upon misstatement in UK, and suffered its economic loss in UK

Shevill v Presse Alliance [1996]

Thus when suing for defamation, in each individual jurisdiction C could recover no more than the harm caused to his reputation in that jurisdiction.

Source Ltd v Rheinland [1998]

Facts arose under which C had claims both in tort and for breach of contract. Was found that English courts had no jurisdiction under BIR to hear claims for breach of contract; thus relevant issue was whether English courts could have jurisdiction to hear tort claims. Held:

Where same facts give rise to both contractual and tortious liability, if UK has no jurisdiction to hear contractual claims it cannot hear the tortious claims.
‘Matters relating to tort’ has been stated by ECJ to mean any liability of D that is non-contractual.

Thus where there is simultaneous liability under a contract and outside of a contract, this liability is ‘contractual’ for purposes of Article 5(1).

Activities of a Branch/Agency

Anton Durbeck [2003]

D, Norwegian bank, entered into a loan agreement with owners of a ship via its London branch, secured on ship itself. Owners defaulted on loan, and London branch gave instructions for arrest of vessel in Panama. C was transporting cargo of bananas on the vessel, and as result of arrest C’s cargo perished. C sued D in England for tort. Held:

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

Here, as it was London branch which gave instructions to seize ship the alleged tort arose out of operations of D’s London branch.

Lloyds Register of Shipping [1995] (ECJ)

D, an English company, had branch in France. French branch entered into contract which fell to be performed in Spain. C accused D of defective performance, and issue was whether French courts could take jurisdiction under Article 5(5). Held:

Under Article 5(5), is no need for contractual undertakings entered into by branch on behalf of D to fall to be performed in Member State in which branch is situated.

Multiple Parties

Gard Marine and Energy Ltd v Glacier Reinsurance [2011] (UK)

Issue was whether C could joinder D2 as defendant in English court case against D1 Article 6(1). Both D1 and D2 had concluded reinsurance contracts with C, which were disputed by C. Held:

When determining risk of irreconcilable judgments, relevant factor is law governing relevant contract (as chosen by parties).
Both D1 and D2 had obviously chosen English law as proper law of their contracts with C.

Thus would be risk of irreconcilable judgments if main issue in dispute (construction of reinsurance) were decided by different courts, as opposed to just the English courts.
Thus joinder permitted.

Watson v First Choice Holidays and Flights Ltd [2001] (UK)

C purchased package holiday in Spain from D1. Whilst there, C visited an accommodation block owned and managed by D2, and was chased away by a security guard; C was injured during chase. C sued D1 for breach of contract, and D2 in tort. D2 challenged use of Article 6(1) by C on basis that joinder was not possible where legal basis of claims was different. Held:

Reunion Europeenne makes clear that can be no joinder where one claim is contractual, and the other tortious.
However rigid application of this principle may lead to inconsistent judgments across EU.

i.e. would mean there could not be joinder even if there is clear connection between claims.

Thus question referred to ECJ.

Reunion Européenne [2000] (ECJ)

Where C has claim against D1 in contract, and against D2 in tort, there can be no joinder of D2 under Article 6(2)
For there to be risk of irreconcilable judgments, claims must have same legal basis.

Third-party Proceedings

Kinnear v Falconfilms [1996]

English actor was killed during making of film in Spain. C, actor’s estate, sued film company for negligence and breach of contract. D sought under Article 6(2) to co-join D2, the hospital at which actor had died, and D3, the surgeon responsible for treating actor; alleged that death had resulted not from injuries sustained during filming but from malpractice of hospital and surgeon before his death. Held:

For Article 6(2) to be used by D to co-join D2, must be sufficient nexus between:

C’s claim against D; and
D’s claim for contribution against D2

Nexus required to bring third-party proceedings under national rules likely to suffice.

Exclusive Jurisdiction

Immovable Property

Reichert v Dresdner Bank [1990] (ECJ)

D’s parents owned property in France, which they gave to D. This gift was challenged by mortgagor of D’s parents on basis of a French action alleging that C had been defrauded of its rights. Issue was whether French court had Article 22 jurisdiction. Held:

Article 22 only applies to proceedings which determine the extent, content, ownership of possession of immovable property or the existence of other right in rem in property.
French action is a claim in personam against D.

thus is no reason for France to have exclusive jurisdiction.

Webb v Webb [1994] (ECJ)

C sued D, claiming that D held property on trust for C in France. D claimed that English courts did not have jurisdiction as Article 22 applies. Held:

Claim is in personam against D.

As C is only seeking to assert rights personally against D
And not as against the whole world

Thus does not fall under Article 22(1)

Companies

Berliner Verkehrsbetriebe v JP Morgan [2011]

C entered contract with D. When C sued D in England for breach of contract, D claimed contract had been entered into in breach of its articles and that therefore the dispute fell under Article 22(2), and had to be heard in Germany (country of C’s seat). Held:

Article 22(2) only applies to proceedings whose principal subject matter is the validity of constitution, validity of decision of company’s organs etc.
Thus where dispute is contractual in nature, validity of D’s decision to enter contract is ancillary

And NOT the principal subject-matter of dispute

Here, dispute was contractual thus Art 22 did not apply....

#3619 - Jurisdiction Under Brussels I Regulation 2 Cases - Conflict of Laws

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