Conflictoflaws

INTRODUCTION
Commercial arbitration is now very popular around the globe. It forms an important part of Nigerian jurisprudence. It is regulated by the Arbitration and Conciliation Act (“ACA”), Cap. A18, LFN 2004.

Clauses designating an arbitral tribunal to resolve disputes between the parties are now common place in international commercial transactions. Generally, Nigerian courts respect and strictly enforce the parties’ choice to resolve their dispute before an arbitral tribunal in both domestic and international cases. This right is however not absolute. The right to resolve disputes before an arbitral tribunal could be waived by submitting to the jurisdiction of the Nigerian court. Indeed, Section 5 (1) of the ACA provides that: “If any party to an arbitration agreement commences any action in any court with respect to any matter which is the subject of an arbitration agreement any party to the arbitration agreement may, at any time after appearance and before delivering any pleadings or taking any other steps in the proceedings, apply to the court to stay the proceeding.” In essence, if a party to an international arbitration clause delivers any pleadings or takes any steps in the proceedings, such a party is deemed to have waived its right to an arbitration clause by submitting to the jurisdiction of the Nigerian court,

What provokes this comment is that in a recent Nigerian Court of Appeal decision in The Vessel MT. Sea Tiger & Anor v Accord Ship Management (HK) Ltd. (2020) 14 NWLR (Pt. 1745) 418 (“Tiger”), the Court of Appeal held inter alia that where a party is served with a judicial claim, in breach of an international arbitration agreement, but fails to appear before the court, such a party is deemed to have waived its right to an arbitration agreement by submitting to the jurisdiction of the Nigerian court. It also held that payment of an out of court settlement amounts to submission.

This comment holds that the Court of Appeal’s decision was wrongly decided in so far as it held that where proceedings are instituted in breach of an international arbitration clause, failure to appear before judicial proceedings and payment of an out of court settlement amounts to waiver by submitting to the jurisdiction of the court.

FACTS

In Tiger (supra), the 2nd plaintiff-appellant and the 1st defendant-respondent – both foreign companies before the Nigerian Court – entered into a ship management agreement on 18th of February 2012 in Hong Kong for the management of the 1st plaintiff-appellant vessel. The parties agreed that any dispute arising from their agreement shall be referred to international arbitration in London.

When a dispute arose as to the payment of the management fees between the parties, the 1st defendant-respondent instituted proceedings (suit No. FHC/L/CS/1789/2013) at the Federal High Court Nigeria for the arrest of the 1st plaintiff-appellant vessel. In that proceeding, the 1st defendant-respondent (as plaintiff) sued the plaintiff-appellants (the vessel and owners of the vessel) as the defendants in that case. The plaintiff-appellants settled the claim out of court by making payments to the 1st defendant-respondent. Subsequently, on 27th February 2014, the 1st defendant-respondent as plaintiff in suit No. FHC/L/CS/1789/2013 withdrew its suit and the vessel was ordered to be released.

In consequence of the arrest of the 1st plaintiff-appellant from 31st December 2013 to 27th February 2018, the appellants sued the defendant-respondents in the Federal High Court, Lagos for huge compensation arising from what it claimed to be the wrongful arrest of the 1st plaintiff-appellant in breach of their agreement to settle their dispute by international arbitration in London.

DECISION
The Court of Appeal unanimously dismissed the claim of the plaintiff-appellants by holding that they had waived their right to the international arbitration clause by submitting to the jurisdiction of the Nigerian Court. The decision was reached on two principal grounds. The first ground was failure to appear and challenge the proceedings after being served with court processes. The second ground was the payment of an out of court settlement in order to release the vessel. In order to provide more clarity, the relevant portions of the decisions are quoted.

First, Garba JCA in his leading judgment held that: “The failure or refusal by it (plaintiff-appellants) to appear in reaction to the originating processes to enable the appellant challenge the jurisdiction of the lower court on the ground of the arbitration clauses in the Ship Management Agreement…left no other reasonable presumption in law and option to the lower court than that the appellants had submitted to the jurisdiction of that court to adjudicate over the suit since the only challenge to the suit by the appellants was entirely and completely predicated and founded on the arbitration clauses in the Ship Management Agreement and not on the lack of jurisdiction on the part of the court, in any event, entertain the suit on any cognizable ground of law. The failure or refusal to enter an appearance and be represented in the suit constituted and amounted to a muted but clear submission to the jurisdiction of the lower court in the case.”

Second, Garba JCA held that: “…the lower court is right that the appellants submitted to its jurisdiction in the suit no:FHC/L/CS/1789/2013 by the payment and settlement of the 1st respondent’s claim in order to secure the release of the 1st appellant from the arrest and detention it was placed under in the case thereby not only taking a step in the case, but actively and effectively so, in the circumstances of the case.”

COMMENTS
The Court of Appeal’s decision in Tiger (supra) is very important from the perspective of private international law and international commercial arbitration. The implication of Tiger (supra) is that where proceedings are instituted in a Nigerian court in breach of a foreign arbitration clause, the party requesting arbitration would be wise to appear before the court and immediately request the court to stay its proceedings in favour of a foreign arbitration clause. If this is not done, an international arbitration clause is ineffective in Nigerian law on the basis that the party requesting arbitration would be deemed to have waived its right by submitting to the jurisdiction of the court. In addition, payment of an out of court settlement would amount to waiver by submitting to the jurisdiction of the Nigerian court.

Prior to Tiger (supra), waiver to an arbitration clause by submission to the jurisdiction of the Nigerian court could only be established where the defendant entered an unconditional appearance or defended the case its merits.

It is submitted that Tiger (supra) is a wrong extension of the principle to the extent that it holds that failure to appear before proceedings which breach an international arbitration clause constitutes waiver by submission to the jurisdiction of a court. A defendant that did not appear before court proceedings cannot be deemed to have waived its right by submitting to the jurisdiction of the Nigerian court. In other words, failure to appear to proceedings upon being duly notified is the very antithesis of submission to the jurisdiction of a court. It is illogical to hold that such a defendant has “delivered pleadings” or “taken steps in the proceedings” in the eyes of Section 5 of the ACA. A defendant is entitled to ignore court proceedings by sticking to the arbitration clause. This should also be seen as a pro-arbitration stance that is consistent with Nigeria’s approach of upholding the sanctity of arbitration agreements. Indeed, as stated in the introduction, Nigerian courts generally enforce arbitration agreements strictly.

The truth is that Tiger’s case reflects the attitude of Nigerian judges to absentee defendants. Nigerian judges regard it as impolite for a defendant not to appear to court proceedings. The preferable approach in Nigerian jurisprudence is to enter a conditional appearance and then challenge the jurisdiction of the court. Indeed, in Muhammed v Ajingi (2013) LPELR-20372 (CA), the Court of Appeal (Abiru JCA) unanimously held that a defendant who has been duly notified of proceedings but fails to appear to promptly challenge the jurisdiction of the court is deemed to have waived its right by submitting to the jurisdiction of the Nigerian court. Though, Muhammed v Ajingi was not an arbitration case, it demonstrates the attitude of Nigerian courts to absentee defendants.

The Court of Appeal was also wrong to have regarded the payment of the settlement sum by the plaintiff-appellants to release the vessel as waiver by submitting to the jurisdiction of the court. Such an approach does not amount to delivering pleadings or taking steps in the proceedings in the eyes of Section 5 of the ACA. Indeed, in the earlier case of Confidence Insurance Ltd v The Trustees of the Ondo State College of Education Staff Pension (1999) 2 NWLR (Pt. 591) 373, 386, the Court of Appeal (Achike JCA as he then was) unanimously held that: “effort made out of court to settle the matter in controversy between the parties” does not amount to submission. Nigerian courts should be seen to encourage out of court settlement. If the law is that efforts made out of court settlement amounts to submission, this might discourage a potential defendant from making out of court settlements, where there is the presence of a foreign arbitration clause.

Tiger (supra) properly so called was an action in damages for breach of an international arbitration clause. Since it has been argued in this case that the plaintiff-appellants did not submit to the jurisdiction of the Nigerian court, damages should have been awarded for breach of the international arbitration clause. If the Court of Appeal had adopted this approach, it would have honoured Nigerian judiciary’s approach to generally and strictly enforce the sanctity of arbitration agreements. It was obvious in this case that the plaintiff-appellants suffered loss from the arrest of its ship in breach of an international arbitration clause. It is unfortunate that the Court of Appeal did not award compensation in this case.

CONCLUSION
It remains to the seen whether Tiger (supra) will go on appeal to the Nigerian Supreme Court. If it does go on appeal, it is proposed that the Supreme Court overturns the Court of Appeal’s decision. If it does not go on appeal to the Supreme Court, it is proposed that the Nigerian Court of Appeal and Supreme Court in future holds that the failure to appear to proceedings in breach of an international arbitration to arbitrate and the payment of out of court settlement does not constitute waiver by submission to the jurisdiction of the Nigerian court.

On 20 October 2020, the European Parliament adopted – with a large margin – a resolution with recommendations to the Commission on a civil liability regime for artificial intelligence (AI). The text of this resolution is available here; on other issues of AI that are part of a larger regulatory package, see the Parliament’s press release here. The draft regulation (DR) proposed in the resolution is noteworthy from a choice-of-law perspective because it introduces new, specific conflicts rules for artificial intelligence (AI) (on the general issues of AI and PIL, see the conference report by Stefan Arnold here). With regard to substantive law, the draft regulation distinguishes between legally defined high-risk AI systems (Art. 4 DR) and other AI systems involving a lower risk (Art. 8 DR). For high-risk AI systems, the draft regulation would introduce an independent set of substantive rules providing for strict liability of the system’s operator (Art. 4 DR). Further provisions deal with the amount of compensation (Art. 5 DR), the extent of compensation (Art. 6 DR) and the limitation period (Art. 7 DR). The spatial scope of those autonomous rules on strict liability for high-risk AI systems is determined by Article 2 DR, which reads as follows:

“1.        This Regulation applies on the territory of the Union where a physical or virtual activity, device or process driven by an AI-system has caused harm or damage to the life, health, physical integrity of a natural person, to the property of a natural or legal person or has caused significant immaterial harm resulting in a verifiable economic loss.

2. Any agreement between an operator of an AI-system and a natural or legal person who suffers harm or damage because of the AI-system, which circumvents or limits the rights and obligations set out in this Regulation, concluded before or after the harm or damage occurred, shall be deemed null and void as regards the rights and obligations laid down in this Regulation.
3. This Regulation is without prejudice to any additional liability claims resulting from contractual relationships, as well as from regulations on product liability, consumer protection, anti-discrimination, labour and environmental protection between the operator and the natural or legal person who suffered harm or damage because of the AI-system and that may be brought against the operator under Union or national law.”

The unilateral conflicts rule found in Art. 2(1) DR would prevail over the Rome II Regulation on the law applicable to non-contractual relations pursuant to Art. 27 Rome II, which states that the Rome II Regulation shall not prejudice the application of provisions of EU law which, in relation to particular matters, lay down conflict-of-law rules relating to non-contractual obligations. Insofar, it must be noted that Art. 2(1) DR deviates considerably from the choice-of-law framework of Rome II. While Art. 2(1) DR reflects the lex loci damni approach enshrined as the general conflicts rule in the Rome II Regulation (Art. 4 Rome II), one must not overlook the fact that product liability is subject to a special conflicts rule, i.e. Art. 5 Rome II, which is considerably friendlier to the victim of a tort than the general conflicts rule. Recital 20 Rome II states that “[t]he conflict-of-law rule in matters of product liability should meet the objectives of fairly spreading the risks inherent in a modern high-technology society, protecting consumers’ health, stimulating innovation, securing undistorted competition and facilitating trade”. In order to achieve these purposes, the Rome II Regulation opts for a cascade of connections, starting with the law of the country in which the person sustaining the damage has his or her habitual residence when the damage occurred, provided that the product was marketed in that country (Art. 5(1)(a) Rome II). If that connection fails because the product was not marketed there, the law of the country in which the product was acquired governs, again provided that the product was marketed in this state (Art. 5(1)(b) Rome II). Finally, if that fails as well, the Regulation returns to the lex loci damni under Art. 5(1)(c) Rome II, if the product was marketed there. This cascade of connections is evidently influenced by the desire to protect the mobile consumer from being confronted with a law that may be purely accidental from his point of view because it has neither a relationship with the legal environment that he is accustomed to (his habitual residence) nor to the place where he decided to expose himself to the danger possibly emanating from the product (place of acquisition). The rule reflects the presumption that most consumers will be affected by a defective product in the country where they are habitually resident. Insofar, Art. 2(1) DR is, in comparison with the Rome II Regulation, friendlier to the operator of a high-risk AI system than to the consumer.

Even if one limits the comparison between Art. 2(1) DR and the Rome II Regulation to the latter’s general rule (Art. 4 Rome II), it is striking that the DR does not adopt familiar approaches that allow for deviating from a strict adherence to lex loci damni. Contrary to Art. 4(2) Rome II, where the person claimed to be liable and the person sustaining damage both have their habitual residence in the same country at the time when the damage occurs, Art. 2 DR does not allow to apply the law of that country. Moreover, an escape clause such as Art. 4(3) or Art. 5(2) Rome II is missing in Art. 2 DR. Finally yet importantly, Art. 2(2) DR bars any party autonomy with regard to strict liability for a high-risk AI system, which deviates strongly from the liberal approach found in Art. 14 Rome II.

Apart from the operator’s strict liability for high-risk AI systems, the draft regulation would introduce a fault-based liability rule for other AI systems (Art. 8 DR). In principle, the spatial scope of the latter liability rule would also be determined by Art. 2 DR as already described. However, unlike the comprehensive set of rules on strict liability for high-risk systems, the draft regulation’s model of fault-based liability is not completely autonomous. Rather, the latter type of liability contains important carve-outs regarding the amounts and the extent of compensation as well as the statute of limitations. Pursuant to Art. 9 DR, those issues are left to the domestic laws of the Member States. More precisely, Art. 9 DR provides that

“Civil liability claims brought in accordance with Article 8(1) shall be subject, in relation to limitation periods as well as the amounts and the extent of compensation, to the laws of the Member State in which the harm or damage occurred.”

Thus, we find a lex loci damni approach with regard to fault-based liability as well. Again, all the modern approaches codified in the Rome II Regulation – the cascade of connecting factors for product liability claims, the common habitual residence rule, the escape clause, and party autonomy – are strikingly absent from the draft regulation.

Moreover, the draft regulation, in principle, limits its personal scope to the liability of the operator alone (as legally defined in Art. 3(d)–(f) DR). Recital 9 of the resolution explains that the European Parliament “[c]onsiders that the existing fault-based tort law of the Member States offers in most cases a sufficient level of protection for persons that suffer harm caused by an interfering third party like a hacker or for persons whose property is damaged by such a third party, as the interference regularly constitutes a fault-based action; notes that only for specific cases, including those where the third party is untraceable or impecunious, does the addition of liability rules to complement existing national tort law seem necessary”. Thus, for third parties, the conflicts rules of Rome II would continue to apply.

At first impression, it seems rather strange that a regulation on a very modern technology – artificial intelligence – should deploy a conflicts approach that seems to have more in common with Joseph Beale’s First Restatement of the 1930’s than with the modern and differentiated set of conflicts rules codified by the EU itself at the beginning of the 21st century, i.e. the Rome II Regulation. While the European Parliament’s resolution, in its usual introductory part, diligently enumerates all EU regulations and directives dealing with substantive issues of liability, the Rome II Regulation is not mentioned once in the Recitals. One wonders whether the members of Parliament were aware of the European Union’s acquis in the field of private international law all. In sum, compared with Rome II, the conflicts approach of the draft regulation would be a regrettable step backwards. It remains to be seen how the relationship between the draft regulation and Rome II will be designed and fine-tuned in the further course of legislation.

In June 2020, the Freiburg Institute for Advanced Studies (FRIAS) held an online symposium dealing with “Global Perspectives on Responsible Artificial Intelligence (AI)”. The range of topics included the implications of AI for European private law (Christiane Wendehorst, ELI/University of Vienna), data protection (Boris Paal, Freiburg), corporate law (Jan Lieder, Freiburg), antitrust (Stefan Thomas, Tübingen), and, last but not least, private international law (Jan von Hein, Freiburg). The videos of the presentations are now available here.

by Marta Pertegás Sender, Maastricht University and University of Antwerp

On 5 February 2021 a group of renowned experts will discuss the attractiveness of Dutch courts in an online interactive seminar. The event will more generally address the settlement of complex private transnational disputes in light of recent Dutch and European legislation.

The starting point for this event is the observation that a number of complex multijurisdictional cases find their way to the Dutch courts. Notorious examples of past and pending collective redress cases include the Shell Nigeria (environmental claims), Libor (market manipulation claims), Petrobras (investor claims) and the “truck cartel” (competition claims) cases.

This “Dutch-bound” trend raises questions about the adequacy of the legal framework for such complex cases, in particular with regard to the international jurisdiction of the Dutch courts, the scope of application of the new law on collective redress, the domestic and international coordination of proceedings, the available (extraterritorial) remedies, etc.

Furthermore, this trend begs a more fundamental question about the position of the Dutch courts in a fragmented legal landscape. The broad application of the Law on Collective Settlements and the more restrictive scope of the new law on collective action, illustrate some of these controversies. Should The Netherlands remain an international dispute settlement hub ( forum conveniens) for such disputes?

Dutch and international academic experts, practitioners and policy-makers will lead the discussion from a legal, political and societal perspective. The attractive programme and line of speakers will soon be available here. For now, please save the date and join us for an in-depth reflection on how to tackle such collective redress cases.

This conference is organised by Maastricht University, Tilburg University and University of Amsterdam (UvA), with the collaboration of the Open University, in the context of the Netherlands Sector Plan on the transformative effects of globalisation in the law.

 

The success of the New York Convention has made arbitration a preferred means of dispute resolution for international commercial transactions. Success in arbitration often depends on the extent to which a party may, in advance, ensure that assets or evidence is secured in advance, or that the other party is required to take steps to secure the status quo. This makes the availability of provisional measures granted by either arbitral tribunals or by courts important to the arbitration process. In this chapter, Ron Brand of the University of Pittsburgh School of Law considers the existing legal framework for such provisional measures in aid of arbitration, giving particular attention to the source of the rules that might govern such relief related to international commercial transactions and the arbitration of disputes they may generate. These include the New York Convention, the applicable lex arbitri, institutional arbitration rules, and the arbitration contract. He considers how these sources do or do not provide a comprehensive and coherent framework for effective dispute resolution – including especially the effective satisfaction of any resulting arbitral award – and some of the ways in which the arbitration clause may be drafted to specifically take into account the often unanticipated, but always possible, need for provisional measures.

TThe article is accessible here

We have already reported on PSEFS, that stands for “Personalized Solution in European Family and Succession Law”, a co-funded EU Justice project, on two occasions: here and here.

On Tuesday 20 & Wednesday 21 October 2020 the project leader University of Camerino and its partners are organising the Final PSEFS Project Events to disseminate at the project results and discuss the pressing issues in the area of cross-border implications of couples’ property and succession. Rich programme includes many speakers from justice and academia. The event will take place online and participation is free of charge while registration is mandatory – here.

Most recent project outcomes include:
– handbook available in 5 languages: M.J. Cazorla González, M. Giobbi, J. Kramberger Škerl, L. Ruggeri & S. Winkler (eds.), Property Relations of Cross-Border Couples in the European Union, Napoli, Edizioni Scientifiche Italiane, 2020.
– model documents and guidelines for practitioners in 5 languages: M.J. Cazorla González, L. Ruggeri (eds.), Guidelines for practitioners in cross-border family property and succession law (A collection of model acts accompanied by comments and guidelines for their drafting), Dykinson, 2020.
Both are available via this link at the bottom of the page.

Guillaume Laganière has published his doctoral thesis (McGill University, May 2020) “Liability for transboundary pollution in private international law: a duty to ensure prompt and adequate compensation” online here. Because of the author’s comparative approach to the topic, the work is not only interesting to Canadian readers. The abstract reads as follows:

 

Our legal response to transboundary pollution depends not only on the adoption of preventive measures and regulatory oversight but also on the existence of civil liability mechanisms. Victims fundamentally seek to hold polluters liable for breaching their duties or deviating from basic standards of diligence, to obtain redress for the damage that ensued and to prevent it from continuing. The process becomes difficult, however, when pollution crosses borders and several domestic regimes are involved. This is where private international law comes into play.

This thesis investigates the regulatory function of private international law with respect to transboundary pollution. It uses the International Law Commission’s Principles on the Allocation of Loss in the Case of Transboundary Harm as a benchmark and assesses Canadian private international law accordingly. It suggests that states have a duty to ensure the availability of prompt and adequate compensation for all victims of transboundary pollution (local or foreign). States must implement domestic measures to facilitate claims against transboundary polluters. This includes equal access to justice and equal remedies for all victims. Private international law plays a crucial role in this context: courts must have jurisdiction to hear cross-border claims and apply a law that is favourable to compensation under choice of law rules.

This thesis builds from international environmental law to identify preferable rules of jurisdiction and choice of law for transboundary pollution in the Canadian context. It also addresses the enforcement of foreign judgments against local polluters. The conclusions of this thesis have implications for all cross-border environmental litigation, including climate change litigation against greenhouse gas emitters currently unfolding in domestic courts around the world.

Serena Forlati and Pietro Franzina edited a book on the Universal Civil Jurisdiction, which was published by Brill a couple of days ago. The book features contributions prepared by colleagues  from four different European countries and eight universities.

The contributions included are the following:

• ‘The Case of Naït-Liman before the European Court of Human Rights – A Forum Non Conveniens for Asserting the Right of Access to a Court in Relation to Civil Claims for Torture Committed Abroad?’ (Andrea Saccucci, University of Campania);

 

• ‘The Role of the European Court of Human Rights in the Development of Rules on Universal Civil Jurisdiction – Naït-Liman v Switzerland in the Transition between the Chamber and the Grand Chamber’ (Serena Forlati, University of Ferrara);

 

• ‘The Interpretation of the European Convention on Human Rights – Lessons from the Naït-Liman Case’ (Malgosia Fitzmaurice, Queen Mary University);

 

• ‘Public International Law Constraints on the Exercise of Adjudicatory Jurisdiction in Civil Matters’ (Lucas Roorda and Cedric Ryngaert, University of Utrecht);

 

• ‘Universal Civil Jurisdiction and Reparation for International Crimes’ (Beatrice I. Bonafè, University of Rome La Sapienza);

 

• ‘Limitations to the Exercise of Civil Jurisdiction in Areas Other Than Reparation for International Crimes’ (Fabrizio Marongiu Buonaiuti, University of Macerata);

 

• ‘Residual Jurisdiction under the Brussels I bis Regulation – An Unexpected Avenue to Address Extraterritorial Corporate Human Rights Violations (Mariangela La Manna, Catholic University of the Sacred Heart, Milan);

 

• ‘The Law Applicable to the Civil Consequences of Human Rights Violations Committed Abroad’ (Patrick Kinsch, University of Luxembourg);

 

• ‘The Changing Face of Adjudicatory Jurisdiction’ (Pietro Franzina, Catholic University of the Sacred Heart, Milan).

More info available here.

EUFams II is a study funded by the European Commission with the objective of assessing the functioning and the effectiveness of European family and succession law. The project is coordinated by the Institute for Comparative Law, Conflict of Laws and International Business Law at Heidelberg University (Prof. Dr. Dr. h.c. Thomas Pfeiffer). Project partners are the Universities of Lund, Milan, Osijek, Valencia and Verona as well as the MPI Luxembourg.

The project will come to a close with an Online Final Conference on Friday, 30 October from 9.30 until 13.00 h. The conference is open to the general public and can be accessed without pre-registration and free of charge. It will cover a wide range of topics in the field of European family and succession law presented by speakers from across Europe.

A detailed program and the access link can be found in the conference leaflet.

More information on EUFams II and its research outputs can be found on the project website and in previous posts on conflictoflaws.net here and here.

This project was funded by the European Union’s Justice Programme (2014-2020). The content of this study represents the views of the authors only and is their sole responsibility. The European Commission does not accept any responsibility for use that may be made of the information it contains.

HCCH 2019 Judgments Convention Repository

In preparation of the Video Roundtable by the University of Bonn and the HCCH on 29 October 2020, we are offering here a Repository of contributions to the HCCH 2019 Judgments Convention. Please email us if you miss something in it, we will update immediately…

Update of 13 October 2020: New entries are printed bold.

Please also check the “official” Bibliograghy of the HCCH for the instrument.

1. Explanatory Reports

Garcimartín Alférez, Francisco;
Saumier, Geneviève „Convention of 2 July 2019 on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters: Explanatory Report“, as approved by the HCCH on 22 September 2020, Pre-Publication available here Garcimartín Alférez, Francisco;
Saumier, Geneviève “Judgments Convention: Revised Draft Explanatory Report”, HCCH Prel.-Doc. No. 1 of December 2018 (available here) Nygh, Peter;
Pocar, Fausto “Report of the Special Commission”, HCCH Prel.-Doc. No. 11 of August 2000 (available here), pp 19-128

 

1. Bibliography

Beaumont, Paul “Forum non Conveniens and the EU rules on Conflicts of Jurisdiction: A Possible Global Solution”, Revue Critique de Droit International Privé 2018, pp 433-447 Beaumont, Paul R. “Judgments Convention: Application to Governments”, Netherlands International Law Review (NILR) 67 (2020), pp 121-137 Blom, Joost “The Court Jurisdiction and Proceedings Transfer Act and the Hague Judgments and Jurisdictions Projects”, Osgoode Hall Law Journal 55 (2018), pp 257-304 Bonomi, Andrea “European Private International Law and Third States”, Praxis des Internationalen Privat- und Verfahrensrechts (IPRax) 2017, pp 184-193 Bonomi, Andrea “Courage or Caution? – A Critical Overview of the Hague Preliminary Draft on Judgments”, Yearbook of Private International Law 17 (2015/2016), pp 1-31 Bonomi, Andrea;
Mariottini, Cristina M. “(Breaking) News From The Hague: A Game Changer in International Litigation? – Roadmap to the 2019 Hague Judgments Convention”, Yearbook of Private International Law 20 (2018/2019), pp 537-567 Borges Moschen, Valesca Raizer;
Marcelino, Helder “Estado Constitutional Cooperativo e a conficaçao do direito internacional privado apontamentos sobre o ’Judgement Project’ da Conferência de Haia de Direito Internacional Privado”, Revista Argumentum 18 (2017), pp 291-319

(Cooperative Constitutional State and the Codification of Private International Law: Notes on the “Judgment Project” of the Hague Conference on Private International Law) Brand, Ronald A. “The Circulation of Judgments Under the Draft Hague Judgments Convention”, University of Pittsburgh School of Law Legal Studies Research Paper Series No. 2019-02, pp 1-35 Brand, Ronald A. “Jurisdictional Developments and the New Hague Judgments Project”, “in HCCH (ed.), A Commitment to Private International Law – Essays in honour of Hans van Loon”, Cambridge 2013, pp 89-99 Brand, Ronald A. “New Challenges in Recognition and Enforcement of Judgments”, in Franco Ferrari, Diego P. Fernández Arroyo (eds.), Private International Law – Contemporary Challenges and Continuing Relevance, Cheltenham/Northampton 2019, pp 360-389 Brand, Ronald A. “Jurisdiction and Judgments Recognition at the Hague Conference: Choices Made, Treaties Completed, and the Path Ahead”, Netherlands International Law Review (NILR) 67 (2020), pp 3-17 Çali?kan, Yusuf;
Çali?kan, Zeynep “2 Temmuz 2019 Tarihli Yabanci Mahkeme Kararlarinin Taninmasi ve Tenfizine Iliskin Lahey Anlasmasinin Degerlendirilmesi”, Public and Private International Law Bulletin 40 (2020), pp 231-245

(An Evaluation of 2 July 2019 Hague Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters) Clavel, Sandrine; Jault-Seseke, Fabienne “La convention de La Haye du 2 juillet 2019 sur la reconnaissance et l’exécution des jugements étrangers en matière civile ou commerciale: Que peut-on en attendre?”, Travaux du comité français de Droit international privé, Vol. 2018-2020, forthcoming (Version provisoire de la communication présentée le 4 octobre 2019 available here) Coco, Sarah E. “The Value of a New Judgments Convention for U.S. Litigants”, New York University Law Review 94 (2019), pp 1210-1243 Cuniberti, Gilles “Signalling the Enforceability of the Forum’s Judgments Abroad”, Rivista di diritto internazionale private e processuale (RDIPP) 56 (2020), pp 33-54 de Araujo, Nadia; de Nardi, Marcelo;
Spitz, Lidia “A nova era dos litígios internacionais”, Valor Economico 2019 de Araujo, Nadia;
de Nardi, Marcelo;
Lopes Inez;
Polido, Fabricio „Private International Law Chronicles“, Brazilian Journal of International Law 16 (2019), pp 19-34

  de Araujo, Nadia;
de Nardi, Marcelo „Consumer Protection Under the HCCH 2019 Judgments Convention”, Netherlands International Law Review (NILR) 67 (2020), pp 67-79 de Araujo, Nadia;
de Nardi, Marcelo „22ª Sessão Diplomática da Conferência da Haia e a Convenção sobre sentenças estrangeiras: Primeiras reflexões sobre as vantagens para o Brasil da sua adoção“, Revista de la Secretaría del Tribunal Permanente de Revisión 7 No. 14 (2019), páginas 198-221

(22nd Diplomatic Session of The Hague Conference and the Convention on Foreign Judgments: First Reflections on the Advantages for Brazil of their Adoption) Dotta Salgueiro, Marcos “Article 14 of the Judgments Convention: The Essential Reaffirmation of the Non-discrimination Principle in a Globalized Twenty-First Century”, Netherlands International Law Review (NILR) 67 (2020), pp 113-120 Douglas, Michael;
Keyes, Mary;
McKibbin, Sarah;
Mortensen, Reid “The HCCH Judgments Convention in Australian Law”, Federal Law Review 47 (2019), pp 420-443 Efeçinar Süral, Ceyda
Possible Ratification of the Hague Convention by Turkey and Its Effects to the Recognition and Enforcement of Foreign Judgments, Public and Private International Law Bulletin 40/2 (2020)
Franzina, Pietro; Leandro, Antonio

  “La Convenzione dell’Aja del 2 luglio 2019 sul riconoscimento delle sentenze straniere: una prima lettura”, Quaderni di SIDIblog 6 (2019), pp 215-231, available at http://www.sidi-isil.org/wp-content/uploads/2020/09/Quaderni-di-SIDIBlog-6-2019.pdf

(The Hague Convention of 2 July 2019 on the Recognition of Foreign Judgments: A First Appraisal) Fuchs, Felix “Das Haager Übereinkommen vom 2. Juli 2019 über die Anerkennung und Vollstreckung ausländischer Urteile in Zivil- oder Handelssachen“, Gesellschafts- und Wirtschaftsrecht (GWR) 2019, pp 395-399 Garcimartín, Francisco “The Judgments Convention: Some Open Questions”, Netherlands International Law Review (NILR) 67 (2020), pp 19-31 Goddard, David „The Judgments Convention – The Current State of Play”, Duke Journal of Comparative & International Law 29 (2019), pp 473-490 He, Qisheng “The HCCH Judgments Convention and the Recognition and Enforcement of Judgments pertaining to a State”, Global Law Review 3 (2020), pp 147-161 He, Qisheng “Unification and Division: Immovable Property Issues under the HCCH Judgement Convention”, Journal of International Law 1 (2020), pp 33-55 Jacobs, Holger “Der Zwischenstand zum geplanten Haager Anerkennungs- und Vollstreckungsübereinkommen – Der vorläufige Konventionsentwurf 2016“, Zeitschrift für Internationales Privatrecht & Rechtsvergleichung (ZfRV) 2017, pp 24-30 Jang, Junhyok “The Public Policy Exception Under the New 2019 HCCH Judgments Convention”, Netherlands International Law Review (NILR) 67 (2020), pp 97-111 Jovanovic, Marko Thou Shall (Not) Pass – Grounds for Refusal of Recognition and

Enforcement under the 2019 Hague Judgments Convention, YbPIL 21 (2019/2020), pp. 309 – 332 Juepter, Eva “The Hague Jurisdiction Project – what options for the Hague Conference?”, Journal of Private International Law 16 (2020), pp 247-274 Kessedjian, Catherine “Comment on the Hague Convention of 2 July 2019 on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters. Is the Hague Convention of 2 July 2019 a useful tool for companies who are conducting international activities?“, Nederlands Internationaal Privaatrecht (NIPR) 2020, pp 19-33 Khanderia, Saloni „The Hague judgments project: assessing its plausible benefits for the development of the Indian private international law”, Commonwealth Law Bulletin 44 (2018), pp 452-475 Khanderia, Saloni “The Hague Conference on Private International Law’s Proposed Draft Text on the Recognition and Enforcement of Foreign Judgments: Should South Africa Endorse it?”, Journal of African Law 63 (2019), pp 413-433 Mariottini, Cristina „Establishment of Treaty Relations under The 2019 Hague Judgments

Convention“, YbPIL 21 (2019/2020), pp. 365-380 Mariottini, Cristina “The Exclusion of Defamation and Privacy from the Scope of the Hague Draft Convention on Judgments, YbPIL 19 (2017/2018), pp 475-486. Meier, Niklaus “Notification as a Ground for Refusal”, Netherlands International Law Review (NILR) 67 (2020), pp 81-95 Nielsen, Peter Arnt “The Hague 2019 Judgments Convention – from failure to success”, Journal of Private International Law 16 (2020), pp 205-246 North, Cara “The 2019 HCCH Judgments Convention: A Common Law Perspective”, Praxis des Internationalen Privat- und Verfahrensrechts (IPRax) 2020, pp 202-210 North, Cara “The Exclusion of Privacy Matters from the Judgments Convention”, Netherlands International Law Review (NILR) 67 (2020), pp 33-48 Oestreicher, Yoav „ ’We’re on a Road to Nowhere’ – Reasons for the Continuing Failure to Regulate Recognition and Enforcement of Foreign Judgments”, The International Lawyer 42 (2008), pp 59-86 Pertegás Sender, Marta “The 2019 Hague Judgments Convention: Its Conclusion and the road ahead”, in Asian Academy of International Law (publ.), Sinergy and Security: the Keys to Sustainable Global Investment: Proceedings of the 2019 Colloquium on International Law, 2019 Hong Kong, pp 181-190 Pertegás, Marta “Brussels I Recast and the Hague Judgments Project”, in Geert Van Calster (ed.), European Private International Law at 50: Celebrating and Contemplating the 1968 Brussels Convention and its Successors, Cambridge 2018, pp 67-82 Ribeiro-Bidaoui, João “The International Obligation of the Uniform and Autonomous Interpretation of Private Law Conventions: Consequences for Domestic Courts and International Organisations”, Netherlands International Law Review 67 (2020), pp 139 – 168 Rumenov, Ilija “Implications of the New 2019 Hague Convention on Recognition and Enforcement of Foreign Judgments on the National Legal Systems of Countries in South Eastern Europe”, EU and Comparative Law Issues and Challenges Series (ECLIC) 3 (2019), pp 385-4040 Saumier, Geneviève “Submission as a Jurisdictional Basis and the HCCH 2019 Judgments Convention”, Netherlands International Law Review (NILR) 67 (2020), pp 49-65 Schack, Haimo “Wiedergänger der Haager Konferenz für IPR: Neue Perspektiven eines weltweiten Anerkennungs- und Vollstreckungsübereinkommens?“, Zeitschrift für Europäisches Privatrecht (ZEUP) 2014, pp 824-842 Schack, Haimo „Das neue Haager Anerkennungs- und Vollstreckungsübereinkommen“, Praxis des Internationalen Privat- und Verfahrensrechts (IPRax) 2020, pp 1-96 Silberman, Linda “Comparative Jurisdiction in the International Context: Will the Proposed Hague Judgments Convention be Stalled?”, DePaul Law Review 52 (2002), pp 319-349 Spitz, Lidia „Refusal of Recognition and Enforcement of Foreign Judgments on Public Policy Grounds in the Hague Judgments Convention – A Comparison with The 1958 New York Convention“, YbPIL 21 (2019/2020), pp 333-364 Stein, Andreas „Das Haager Anerkennungs- und Vollstreckungsübereinkommen 2019 – Was lange währt, wird endlich gut?“, Praxis des Internationalen Privat- und Verfahrensrechts (IPRax) 2020, pp 197-202 Stewart, David P. „Current Developments: The Hague Conference adopts a New Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters”, American Journal of International Law (AJIL) 113 (2019), pp 772-783 Taquela, María Blanca Noodt; Abou-Nigm, Verónica Ruiz “News From The Hague: The Draft Judgments Convention and Its Relationship with Other International Instruments”, Yearbook of Private International Law 19 (2017/2018), pp 449-474 Teitz, Louise Ellen “Another Hague Judgments Convention? – Bucking the Past to Provide for the Future”, Duke Journal of Comparative & International Law 29 (2019), pp 491-511 van der Grinten, Paulien;
ten Kate, Noura „Editorial: The 2019 Hague Judgments Convention”, Nederlands Internationaal Privaatrecht (NIPR) 2020, pp 1-3 van Loon, Hans “Towards a global Hague Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters”, Nederlands Internationaal Privaatrecht (NIPR) 2020, pp 4-18 van Loon, Hans “Towards a Global Hague Convention on the Recognition and Enforcement of Judgments in Civil or Commercial Matters”, Collection of Papers of the Faculty of Law, Niš 82 (2019), pp 15-35 van Loon, Hans “Le Brexit et les conventions de La Haye”, Revue Critique de Droit International Privé 2019, pp 353-366 Wagner, Rolf “Ein neuer Anlauf zu einem Haager Anerkennungs- und Vollstreckungsübereinkommen“, Praxis des Internationalen Privat- und Verfahrensrechts (IPRax) 2016, pp 97-102 Weidong, Zhu “The Recognition and Enforcement of Commercial Judgments Between China and South Africa: Comparison and Convergence”, China Legal Science 2019-06, pp 33-57 Weller, Matthias “The HCCH 2019 Judgments Convention: New Trends in Trust Management?”, in Christoph Benicke, Stefan Huber (eds.), Festschrift für Herbert Kronke zum 70. Geburtstag, Bielefeld 2020, pp 621-632 Weller, Matthias “The 2019 Hague Judgments Convention – The Jurisdictional Filters of the HCCH 2019 Judgments Convention”, Yearbook of Private International Law 21 (2019/2020), pp 279 – 308 Weller, Matthias “Das Haager Übereinkommen zur Anerkennung und Vollstreckung ausländischer Urteile”, in: Thomas Rauscher (ed.), Europäisches Zivilprozess- und Kollisionsrecht, Munich, 5th ed., forthcoming Weller, Matthias Die Kontrolle der internationalen Zuständigkeit im Haager Anerkennungs- und Vollstreckungsübereinkommen 2019, in Christoph Althammer/Christoph Schärtl, Festschrift für Herbert Roth, in Vorbereitung. Wilderspin, Michael;
Vysoka, Lenka “The 2019 Hague Judgments Convention through European lenses”, Nederlands Internationaal Privaatrecht (NIPR) 2020, pp 34-49 Xu, Guojian “Comment on Key Issues Concerning Hague Judgment Convention in 2019 “, Journal of Shanghai University of Political Science and Law 35 (2020), pp 1-29 Xu, Guojian “To Establish an International Legal System for Global Circulation of Court Judgments”, Wuhan University International Law Review 5 (2017), pp 100-130 Xu, Guojian “Overview of the Mechanism of Recognition and Enforcement of Judgements Established by HCCH 2019 Judgments Convention”, China Journal of Applied Jurisprudence No. 2020-02, pp 65-77 Yeo, Terence “The Hague Judgments Convention – A View from Singapore”, Singapore Academy of Law Journal (e-First) 3rd August 2020 (available here) Zhao, Ning “Completing a long-awaited puzzle in the landscape of cross-border recognition and enforcement of judgments: An overview of the HCCH 2019 Judgments Convention”, Swiss Review of International and European Law (SRIEL) 30 (2020), pp 345-368

 

by José Antonio Briceño Laborí, Professor of Private International Law, Universidad Central de Venezuela y Universidad Católica Andrés Bello

The Master’s Program in Private International Law and Comparative Law at the Universidad Central de Venezuela started on October 1st a series of conferences titled “Master Classes – Selected Topics on Private International Law” held in the Aula Maekelt (Maekelt Classroom), named in honor of the beloved late professor Tatiana B. de Maekelt. The conferences will be held in Spanish (unless otherwise indicated), every fifteen days through the application Google Meet (or other virtual conference application).

The Master Classes were inaugurated with a lecture by Professor Eugenio Hernández-Bretón titled “Scope of territorial application of data protection laws: a ‘revived’ conflict of laws?” where professor Hernández-Bretón explained the problems posed by the territoriality of data protection laws and how they can be solved through the principles of Private International Law. This opened a fruitful discussion among the attendees.

The next lecture will be held on October 15 at 4:00 p.m. (Venezuelan Time) by Professor Andrés Carrasquero Stolk on the subject “Enforcement immunity from judgements and awards against Venezuela”. If you want to attend this Master Class you can email the Master’s Program at mdipr.ucv@gmail.com, where they will give you all the information.

To stay current on the future activities of the Master’s Program, you can follow it on Twitter, Instagram, Facebook and LinkedIn.

  

TABLE OF CONTENTS

________________

Foreword …………………………………………………………………………………………… xi

Abbreviations …………………………………………………………………………………… xiii

Doctrine

Janeen CARRUTHERS

Discerning the Meaning of “Habitual Residence of the Child” in

UK Courts – A Case for the Oracle of Delphi ……………………………………… 1

Christian KOHLER

The EU Succession Regulation before the German Courts 2016-2019 ….. 37

Mihail DANOV

Cross-Border Litigation – New Data, Initial Brexit Implications in

England and Wales and Long-Term Policy Choices …………………………… 57

Nikitas E. HATZIMIHAIL

On the Doctrinal Beginnings of the Conflict of Laws ……………………….. 101

Interim Measures in International Commercial Litigation

Proceedings of the SICL’s 31st Private International Law Day –

Lausanne, 23 May 2019

Andrea BONOMI

Interim Measures at the Crossroads of International Litigation and

Arbitration – Some Remarks on Concurrent Jurisdiction and Cross-

Border Enforcement ……………………………………………………………………… 137

Alexander LAYTON

Interim Measures in English Law and their Circulation …………………….. 159

Sandrine GIROUD / Noémie RAETZO

The Recognition and Enforcement of Foreign Interim Measures

in Switzerland ……………………………………………………………………………… 175

Ilaria PRETELLI

The Law Applicable to Provisional and Protective Measures – With

a Focus on the EU System of Ancillary Reliefs ………………………………… 197

Gilles CUNIBERTI

Jurisdiction to Grant Interim Measures in Support of Arbitration –

The Influence of European Law …………………………………………………….. 225

Laurent HIRSCH

Swiss Practice of Interim Relief in International Arbitration ……………… 237

Karim EL CHAZLI / Ahmed HABIB

Interim Measures in International Arbitration – An Arab Perspective …. 259

viii

The 2019 Hague Judgments Convention

Matthias WELLER

The Jurisdictional Filters of the HCCH 2019 Judgments Convention ….. 279

Marko JOVANOVIC

Thou Shall (Not) Pass – Grounds for Refusal of Recognition and

Enforcement under the 2019 Hague Judgments Convention ………………. 309

Lidia SPITZ

Refusal of Recognition and Enforcement of Foreign Judgments on

Public Policy Grounds in the Hague Judgments Convention –

A Comparison with The 1958 New York Convention ……………………….. 333

Cristina M. MARIOTTINI

Establishment of Treaty Relations under The 2019 Hague Judgments

Convention ………………………………………………………………………………….. 365

National Reports

Yitshak COHEN

International Jurisdiction of the Rabbinical Courts in Claims for

Divorce in Israel ………………………………………………………………………….. 381

Florence GUILLAUME

The Connecting Factor of the Place of Celebration of Marriage in

Swiss Private International Law …………………………………………………….. 399

Yin LIU

Recognition of Foreign Same-Sex Unions in China ………………………….. 425

Richard Frimpong OPPONG / Sam TECLE

The lex loci delicti Rule in Canadian Conflict of Laws ……………………… 457

Eduardo PICAND ALBÓNICO

Law of Succession to Estates of Deceased Persons in Chilean Private

International Law …………………………………………………………………………. 489

Court Decision

Wolfgang FABER

Foreign Proprietary Security Rights Failing to Comply with National

Publicity Standards to Be Accepted? On Case No. 3 OB 249/18S of the

Austrian Supreme Court of Justice …………………………………………………. 509

ix

Forum

Pascal FAVROD-COUNE

The Legal Position of the Weaker Party in B2B Relationships with

Online Platforms in the European Union – An Analysis of Dispute

Resolution Mechanisms in Regulation (EU) 2019/1150…………………….. 523

Maria Chiara MARULLO

“Almost” Universal Jurisdiction …………………………………………………….. 549

Adeline MICHOUD

Public Policy Exceptions in U.S. and European Private International

Law – An Ultimate Fortress for Social and Environmental Standards? 569

Chukwuma Samuel Adesina OKOLI

Choice of Law in The European Union – Common Law Procedure and

Evidence …………………………………………………………………………………….. 589

Sven RIVA

Decentralized Autonomous Organizations (DAOs) in the Swiss

Legal Order …………………………………………………………………………………. 601

Cassius Jean SOSSOU BIADJA

Bridging the Gap in the OHADA Treaty with Respect to the

Interpretative Role of the CCJA in Arbitration Matters ……………………… 639

Index ………………………………………………………………………………………………. 663

On 11 September 2020, the European Parliament’s Committee on Legal Affairs presented a draft report with recommendations to the Commission on corporate due diligence and corporate accountability. This report has already triggered first online comments by Geert van Calster and Giesela Rühl; the present contribution aims both at joining and at broadening this debate. The draft report consists of three proposals: first, a directive containing substantive rules on corporate due diligence and corporate accountability; secondly, amendments to the Brussels Ibis Regulation that are designed to grant claimants from third states access to justice in the EU Member States; and thirdly, an amendment to the Rome II Regulation on the law applicable to non-contractual obligations. The latter measure would introduce a new Art. 6a Rome II, which codifies the so-called principle of ubiquity for business-related human rights claims, i.e. that plaintiffs are given the right to choose between various laws in force at places with which the tort in question is closely connected. While the basic conflicts rule remains the place of damage (lex loci damni) under Art. 4(1) Rome II, Art. 6a of the Rome II-draft will allow plaintiffs to opt for the law of the country in which the event giving rise to the damage occurred (the place of action or lex loci delicti commissi in the narrow sense), the law of the country in which the parent company has its domicile, or, where it does not have a domicile in a Member State, the law of the country where it operates.

The need for having a conflicts rule on the law applicable to business-related human rights claims derives from the fact that the draft report proposes a directive which only lays down minimum requirements for corporate due diligence concerning human rights, but which does not contain an independent set of rules on civil liability triggered by a violation of such standards. Thus, domestic corporate and tort laws will continue to play an important role in complementing the rules of the directive once they have been transposed into domestic law. In theory, this problem might be avoided by trying to pass a wholesale EU Regulation containing both rules on corporate due diligence as well as on related issues of civil liability. The EU has already passed the Regulations on Timber and Conflict Minerals, which deal with fairly specific issues and which are limited in their scope. Taking into account, however, that both domestic corporate law and tort law are very intricate bodies of law, the EU legislature so far has, in the overwhelming number of cases, opted for the less intrusive and more flexible instrument of a directive (see, e.g., the Directive [EU] 2017/1132 relating to certain aspects of company law or the Product Liability Directive). The regulatory choice made in the draft report is thus fully consistent with established modes of EU legislation and the principle of subsidiarity.

The fundamental conflicts problem arising in cross-border human-rights litigation is well-known: Art 4(1) Rome II leads to the application of the law in force at the place of damage, which is frequently located in a third world country having a “weak legal system and enforcement (cf. Recital 2 of the draft directive). Starting a suit in such a forum frequently results not in a “home-court advantage” for plaintiffs, but rather diminishes their prospects of success. Insofar, suing a multinational corporation in the EU becomes attractive. While the hurdle of international jurisdiction can be surmounted rather easily in most cases, e.g. by suing the defendant at its general jurisdiction (Art. 4(1) Brussels Ibis), a Member State court will nevertheless, under Art. 4(1) Rome II, apply a third state law. In the discussion about domestic due diligence laws, the widely preferred, if not the only viable solution so far has consisted in characterising such laws as being of an overriding mandatory nature within the meaning of Art. 16 Rome II, thus ensuring their application in spite of the otherwise applicable tort law. Seen from the national perspective, this is of course a sound approach because a Member State legislature simply has no mandate to tinker with the Rome II Regulation itself. Once the question of corporate due diligence and liability is answered at the EU level itself, however, there is no practical need for limiting the doctrinal discussion to a unilateral approach within the narrow framework of Art. 16 Rome II. In light of this fact, it is not surprising that the draft report explores another conflicts tool that has been developed in order to strengthen the protection of weaker parties or general interests, i.e. the principle of applying the law more favourable to a party in a given case. This approach, which nowadays mostly consists in letting the plaintiffs choose which law they consider more favourable to them, is well-known, for example, in the domestic PIL codes of Italy and Germany. In those countries, it even is the general rule in international tort law – a hardly convincing solution, because the victim is not the weaker party in every case (for an in-depth treatment of this issue, see here). Therefore, the more modern Rome II Regulation opted for a more differentiating approach: lex loci damni is the general rule (Art. 4(1) Rome II), whereas the principle of ubiquity – i.e. that a tort may be located in more than one place – is only codified in groups of cases where a specific interest legitimises deviating from this rule: first, environmental damage (Art. 7 Rome II), and secondly, multi-state cases involving cartel damages (Art. 6(3) Rome II). Moreover, while Rome II is not applicable to violations of personality rights, the CJEU’s case law on Art. 7(2) Brussels Ibis has frequently been emulated in domestic conflicts law as well. In sum, the principle of ubiquity has always remained a part of the doctrinal toolbox of EU choice of law.

Insofar, the question must be answered as to whether the ubiquity approach has major advantages compared with the mandatory rule approach. The first factor in favour of applying the principle of ubiquity to business-related human rights claims as well is that it considerably reduces the need for the frequently difficult delineation between human rights violations (Art. 6a Rome II draft) and environmental damages (Art. 7 Rome II). Thus, intricate problems of characterisation and, if necessary, adaptation, are avoided at the outset. In addition, tortious human rights claims may also be rooted in a violation of ILO labour standards (see the definition of “human rights risk” in Art. 3 of the proposed directive). In light of the fact that Art. 8(1) Rome I favours the employee as well by providing for an alternative connection of contractual claims, having a favor laboratoris for labour-related human-rights claims fits into the normative framework of EU law, too.

A second advantage is that the ubiquity approach respects party autonomy (Art. 14 Rome II), whereas the parties could not derogate from a truly mandatory rule (Art. 16 Rome II). Thus, the ubiquity approach facilitates settlements, particularly in human rights cases that involve a large number of claimants.

Thirdly, claimants from the Global South are frequently compelled by the “weak legal systems and enforcement“ of their home country to seek their fortune abroad rather than by weaknesses of their own substantive laws. In many former colonies, the Common Law or the French Code Napoléon are still in force (with modifications) and would in principle allow a successful suit based on a tortious claim. In this regard, giving claimants the option to sue a company in a Member State, while at the same time applying their own law if they so wish, avoids a paternalistic, neo-colonialist stance that rests on the implicit assumption that our Western laws are inherently better than those of developing countries.

A fourth factor arguing for giving plaintiffs the right to choose the applicable law is that the mandatory rule approach will frequently not sufficiently cover the risks inherent in cross-border litigation. In the German Rana Plaza case, the claims of the plaintiffs failed because, under the law of Pakistan, they were barred by the statute of limitations, which was extremely short (just one year) compared with German standards, particularly for a cross-border case (see OLG Hamm NJW 2019, 3527). In light of the CJEU case law on Art. 16 Rome II, however, German limitation periods could hardly be characterised as being of an overriding mandatory nature (ECLI:EU:C:2019:84). Under Art. 6a Rome II-draft, the claimants could simply have chosen German law to govern their case.

On the other hand, the ubiquity approach has been criticised as leading to an impairment of foreseeability because the question of the applicable law remains unanswered until the plaintiffs have made their choice. However, under the mandatory rule approach as well, foreseeability of the applicable law is not necessarily guaranteed. Only a Member State court would apply the due diligence standard as a part of its own lex fori (Art. 16 Rome II), but a company would always face the risk of being sued in a third state where it would not be ensured that a local court would take a foreign mandatory rule into account. Even among the Member States, such a courtoisie could not be taken for granted because, unlike Art. 9(3) Rome I, the Rome II Regulation contains no rule on the applicability of foreign overriding mandatory rules. One might argue that this concern is purely academic because the proposed directive would harmonise the standards of corporate due diligence in the EU anyway. Yet this would be a serious error because the proposal (Art. 1(1) subpara. 2) only establishes minimum requirements.

Thus, the advantages inherent in the ubiquity approach clearly outweigh those of the mandatory rule approach. Nevertheless, it is certainly true that there can be too much of a good thing. Allowing the plaintiffs to choose between four different laws is hardly practical and sets up a very dangerous liability trap for lawyers who would have to perform extremely difficult studies in comparative law before advising their clients on where to sue a defendant. Thus, the number of options should simply be reduced to two: either the place of damage or the habitual residence of the defendant.

The latter option should refer to the habitual residence of a corporation because this is the connecting factor commonly used in the Rome II Regulation (Art. 23 Rome II). There is no practical need to replace it with “domicile” which is a concept deployed in European civil procedure (Art. 63 Brussels Ibis), but not in EU choice-of-law Regulations.

In sum, Article 6a Rome II-draft certainly leaves room for further refinement, but its basic approach rests on a sound doctrinal rationale and has major practical advantages compared with the mandatory rule model so far favoured in domestic due diligence laws. Thus, the EP draft deserves an appropriate and thorough consideration rather than a hasty judgment.

(This is another version of views for the recent Chinese case on international commercial arbitration provided by Chen Zhi, a PhD candidate in the University of Macau, Macau, PRC)

On 6 August 2020, Guangzhou People’s Intermediate Court (“Guangzhou court”) handed down a ruling on a rare case concerning the enforcement of an award rendered by International Commercial Court of Arbitration (“ICC”) in China,[1] which have given rise to heated debate by the legal community in China. This case was thought to be of great significance by many commentators because it could open the door for enforcement of arbitral awards issued by foreign institution with seat of proceeding in China, and demonstrates the opening-up trend for foreign legal service.
[1]Brentwood Industries Inc. v. Guangdong Faanlong Co, Ltd and Others 2015 Sui Zhong Min Si Fa Chu No.62?

Backgrounds of the facts
The plaintiff, Brentwood Industries, Inc. a USA based company, entered into a Sale and Purchase Agreement (“SPA”) along with a Supplementary Agreement with three Chinese companies (collectively, “Respondents”) in April 2010. Article 16 of Sale and Purchase Agreement provided as follow:
Any dispute arising out of or in connection with this contract shall be settled by amicable negotiation between the parties. If such negotiations fail to resolve the dispute, the matter shall be referred to the Arbitration Commission?sic?of International Chamber of Commerce for arbitration at the project site in accordance with international practice. The award thereof shall be final and binding on the Parties. The costs of the arbitration shall be borne by the losing party, unless the Arbitration Commission?sic?decides otherwise. The language of the arbitration shall be bilingual, English and Chinese.

According to Article 3 of Supplementary Agreement, the project site was in Guangzhou.
On 29 May 2011, Brentwood submitted an application to Guangzhou Court, seeking for nullification of the arbitration clause in SPA. The Guangzhou Court handed down a judgement in early 2012 rejecting Brentwood’s application and confirming the validity of the arbitration clause.
Because the ICC does not have an office in Guangzhou, Brentwood subsequently commenced an arbitration proceeding before Arbitration Court of International Chamber of Commerce Hong Kong Office on 31 August of 2012. In the course of proceeding, all three respondents participate in the arbitration presenting their written defenses, and among them, one respondent also raised objection of jurisdiction of the ICC Court to handle the case. The ICC Court decided that the jurisdiction issue shall be addressed by a sole arbitrator after giving all parties equal opportunities to present their arguments. Hence, with the consensus of all parties, the ICC Court appointed a sole arbitrator on 10 January of 2013.

On 3rd April 2013, the case management conference was held in Guangzhou and each party appeared and agreed upon the Term of Reference. After exchange of written submissions and hearing (all attended by all parties), the arbitrator rendered Final Award with the reference No. 18929/CYK (the Final Award) on 17 March 2014.

Enforcement proceeding and judgment
Brentwood sought to enforce the Final Award before the Guangzhou Court, mainly on the basis of non-domestic award as prescribed in Article 1(1) of the “New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958, which China is a signatory party (“New York Convention”). To increase its options in obtaining enforcement, Brentwood also invoked the Arrangement on Reciprocal Enforcement of Arbitral Awards Between SPC and Hong Kong Special Administrative Region Government, in the event the court regards the award as Hong Kong award because conducted by the ICC Hong Kong Office.
The Respondents raised their own objections respectively, which can be summarized to four main points:
(1) non-domestic award under New York Convention was not applicable to the PRC because it had declared reservation on this matter;
(2) the arbitration clause was invalid because the ICC Court was not an arbitration institutions formed in accordance with Article 10 of the PRC Arbitration Law (revised in 2017);
(3) there are substantive errors in the Final Award;
(4) the arbitrator exceeded its power in the Final Award.

The Guangzhou Court ruled that the arbitration clause was valid and its validity had been confirmed in previous case by the same court. As for the nationality and enforceability of the Final Award, the court opined that it shall be regarded as a domestic award which can be enforced in accordance to Article 273 of Civil Procedural Law (revised in 2012), and stipulated that the awards by foreign-related arbitration institutions in China were enforceable before competent intermediated courts. Based on the above reasoning, the court stated that Brentwood had invoked the wrong legal basis, and it refused to amend its claim after the court asked clarification multiple times. Hence, the court concluded that the case shall be closed without enforcing the Final Award, while Brentwood had the right to file a new enforcement proceeding with correct legal basis.

China’s Stance to domestic award by foreign institutions
There is no law directly applicable to awards issued by foreign institution with seat in China. The current legislation divided awards into three categories:
(1) domestic award rendered by Chinese arbitration institutions, which is governed by the Arbitration Law and Civil Procedure Law.
(2) foreign-related award made by Chinese institutions, which is enforceable under Article 273 of Civil Procedure Law.
(3) awards made offshore, which are governed by international conventions (i.e. New York Convention), judicial arrangements and Supreme People Court’s judicial interpretation depending on the place of arbitration.

The problem arises mainly because of the conflict between Chinese law and international conventions. Unlike the common practice in international arbitration across the world, which decides the nationality of award and competent court for remedies thereof based on the seat of arbitration proceeding, Chinese law traditionally relied upon the nationality of arbitration institutions instead. The term “arbitration seat” was not embedded in the legislation framework until the SPC’s Interpretation on Application of Arbitration Law in 2006, and Supreme People’s Court only begins to decide the nationality of award based on the seat since 2009.[2]
Due to the lacuna in law, there is no remedy for such China seated foreign award, and therefore parties may face enormous legal risks: on one hand, such award cannot be enforced by any Chinese court if the losing party refuse to perform it voluntarily, on the other hand, the party who is dissatisfactory with the award or arbitration proceeding has no way to seek for annulment of the award.
In 2008, Ningbo Intermediate Court ruled on a controversial case concerning the enforcement of an ICC award rendered in Beijing,[3] granting enforcement by regarding the disputed award as “non-domestic” award as prescribed in the last sentence of the Article 1(1) of New York Convention, under which the member states may extend the effect of Convention to certain type of award which is made inside its territory while is not considered as domestic for various reasons. It shall be noted that the method used by Ningbo Court is problematic and have given rise to heavy criticisms,[4] because China had filed the reservation set out in Article 1(3) of New York Convection confirming that it will apply the Convention to the “recognition and enforcement of awards made only in the territory of another Contracting State”. In other words, said non-domestic award approach shouldn’t be use by Chinese courts.
With this respect, the approach employed in Brentwood seems less controversial because it does not concern a vague and debatable concept not included in current law. Moreover, by deciding the nationality of award based on the seat of arbitration instead of the base of institution, the Guangzhou Court is actually promoting the reconciliation of Chinese law with New York Convention.

[2]See Article 16 of SPC’s Interpretation on Several Questions in Application of Arbitration Law Fa Shi 2006 No.7, see also SPC’s Notice on Matters of Enforcing Hong Kong Award in Continental China Fa 2009 No. 415. As cited in Gao Xiaoli, The Courts Should Decide the Nationality of Arbitral Award by Seat Instead of Location of Arbitration Institution, People’s Judicature (Volume of Cases), Vol.2017 No. 20, p. 71.
[3] Duferco S.A. v. Ningbo Art & Craft Import & Export Corp. 2008 Yong Zhong Jian No.8.
[4] Author Dong et al, Does Supreme People’s Court’s Decision Open the Door for Foreign Arbitration Institutions to Explore the Chinese Market?, available at http://arbitrationblog.kluwerarbitration.com/2014/07/15/does-supreme-peoples-courts-decision-open-the-door-for-foreign-arbitration-institutions-to-explore-the-chinese-market/

Comments
Brentwood decision does not appear out of thin air, but contrarily, it is in line with the opening-up trend in the judicial practice of commercial arbitration in China started in 2013. At that time, the Supreme People’s Court ruled on the landmark Longlide case by confirming the validity of arbitration agreement which require arbitration proceeding conducted by foreign arbitration in China.[5]This stance has been followed and further developed by the First Intermediate Court of Shanghai in the recent Daesung Industrial Gases case,[6]. In this case, a clause providing “arbitration in Shanghai by Singapore International Arbitration Center” was under dispute by two respondents who alleged that foreign based institutions were prohibited from managing arbitration proceeding in China. However the court viewed this assertion as lacking of legal basis in Chinese law, and was contradictory to the developing trend of international commercial arbitration in the PRC.
In addition, local administrative authorities have shown firm stance and laudable attempt to promote the opening-up policy by attracting foreign institutions to carry out business in China. In late 2019, the justice department of Shanghai adopted new policies permitting foreign arbitration bodies to setup branch and carry out business in Lingang Free Trade Pilot Zone, and to set up detailed rules for registration and supervision in this regard.[7] On 28 August of 2020, the State Council agreed to a new proposal jointly by the Beijing government and the Ministry of Commerce on further opening up service industry, allowing world-renowned offshore arbitration institutions to run business in certain area of Beijing after registration at the Beijing justice department and the PRC Justice Ministry. This goes even further than Shanghai’s policy by stipulating that competent authorities shall support preservations for arbitration proceeding, increasing the reach of foreign institution on local justice system.[8]
Nevertheless, there are still lots of works to be done for the landing of foreign institutions:
First, as the lacuna in the law still exists, the judicial policy will continue to be “uncertain, fraught with difficulty and rapidly evolving” in this regard, as described by the High Court of Singapore. [9] Because Article 273 of Civil Procedural Law does not contain award by foreign institution stricto senso, and Guangzhou Court applied it only on analogous basis, this approach is more likely to be an expedient measure by taking into account surrounding circumstances (i.e. the validity of arbitration clause in dispute had been confirmed by the court itself, and all respondents had actively participated in the arbitration proceeding), instead of corollary of legal terms. Further, albeit the decision in Brentwood case is consistent with SPC’s opening-up and arbitration friendly policy, no evidence shows its legal validity was endorsed by SPC like that in Longlide case. Therefore, it is doubtful whether this approach will be employed by other courts in future.
Second, even though the validity and enforceability issues have been settled, the loophole in law concerning auxiliary measures (i.e. interim relief, decision of jurisdiction, etc.) and annulment proceeding remains unsolved, which will probably be another obstruction for foreign institution to proceed with arbitration proceeding in Continental China. The above mentioned proposal by Beijing government provides a good example in this respect, while this problem can only be fully settled through revision of law.

Third, the strict limitations on the content of arbitration agreement remain unchanged. Arbitration agreements providing ad hoc proceeding is still invalid by virtue of the law. Moreover referring dispute without foreign-related factor to foreign institutions is also unacceptable under current judicial policy, even for exclusively foreign-owned enterprises. These limitations have been heavily criticized by legal practitioners and researchers over the years, however whilst the above issues have been formally lifted, the arbitration agreement shall be well drafted in terms of both arbitration institution and the seat of arbitration.

[5] Longlide Packaging Co. Ltd. v. BP Agnati S.R.L. (SPC Docket Number: 2013-MinTa Zi No.13).
[6] Daesung Industrial Gases Co., Ltd.&Another v. Praxair (China) Investment Co., Ltd 2020 Hu 01 Min Te No.83.
[7] See: Measures for the Establishment of Business Bodies by Offshore Arbitration Institutions in the New Lingang Area of the Pilot Free Trade Zone of China (Shanghai) available at http://sfj.sh.gov.cn/xxgk_gfxwj/20191020/3fbcd61ef43147379c5841e28bdf6007.html
[8] See Article 8 of State Council’s Instruction on the Work Plan for the Construction of a National Demonstration Zone for Expanding and Opening Up Beijing’s Services Industry in a New Round of Comprehensive Pilot Project?available at http://www.gov.cn/zhengce/content/2020-09/07/content_5541291.htm?trs=1
[9] BNA v BNB [2019] SGHC 142 para.116.

Written by Stephen Armstrong, lawyer practicing in Toronto, Ontario, Canada with an interest in international arbitration. [Linkedin]

On Friday, October 9, 2020, the United Kingdom Supreme Court released an interesting decision concerning the applicable law governing arbitration agreements in international contracts and the jurisdiction of the courts of the seat of the arbitration to grant anti-suit injunctions. The case is Enka Insaat Ve Sanayi A.S. v 000 Insurance Company Chubb, [2020] UKSC 38.

The full text of the Supreme Court’s decision is available here.

A digestible summary of the case, including the facts, the breakdown of votes, and the reasons, is available here.

Interestingly, the Supreme Court fundamentally disagreed with the Court of Appeal on the role of the seat of the arbitration for determining the law of the arbitration agreement. The Supreme Court held that an express choice of law in the main contract should be presumptively taken as an implied choice of law governing the arbitration agreement. By contrast, the Court of Appeal had held that the law of the seat was the parties’ presumptive implied choice of law for the arbitration agreement. The Supreme Court did, however, affirm the Court of Appeal’s holding that the courts of the seat are always an appropriate forum to grant an anti-suit injunction, regardless of the applicable law.

Unlike other choice of law issues in the UK, this issue is governed by the common law, rather than the EU’s Rome I regulation. This makes the Supreme Court’s decision a common law authority, rather than an EU law authority. I therefore expect that this decision will find purchase throughout the Commonwealth, including my home jurisdiction of Ontario, Canada.

The German Bundesgerichtshof (BGH) in August finally decided the case “Sahyouni” that made it twice to the ECJ (Sahyouni I  and Sahyouni II). The BGH decision (German text here) applied the new German rules on private divorces. The German legislator had enacted these rules after the ECJ declared the Rome III Regulation as only applicable on divorces by a court. Additionally, the court took the opportunity to comment on several other private international law issues. The probably most interesting issues of the case are (1) the new German rules, (2) the treatment of parties with more than one nationality if the connecting factor is nationality and (3) the question whether the unilateral private divorce finally was recognized.

1. German law regarding “private divorces”

Following the second “Sahyouni” decision, new private international law rules were enacted. German private international law follows the principle of “recognition via conflict of laws”, meaning that a divorce not issued by a court decision will only be recognized if it complies with the rules applicable according to German private international law. The new rules basically declared the Rome III Regulation applicable to private divorces mutatis mutandis except for those rules that could not be applied on a private divorce (e.g. the application of lex fori as there is not forum). Furthermore, Article 10 Rome III, the rule that initially triggered the request for the preliminary ruling, is not applicable. Thus, only the “usual” public policy exception can prevent the application of the lex causae.

1. Treatment of double-nationality

The court came to the conclusion that the spouses did not have a common habitual residence as required by Article 8 lit a, b Rome III (mutatis mutandis). So, the question occurred whether the spouses had a common nationality (Article 8 lit. c). In this special case, both spouses did not only have one common nationality but two: German and Syrian. As the Rome III regulation is silent to the treatment of double-nationals (and, furthermore, Rome III only applied mutatis mutandis), the court applied Article 5 para. 1 EGBGB (English non-official translation here). This rule provides in case of double-nationality (1) a prevalence of the German nationality and (2), if no German nationality is in play, a prevalence of the “effective” nationality, ie the nationality that is closer connected to the person, usually the one of habitual residence. In the context of EU private international law, there was a discussion whether these two rules can hold – given that in Garcia Avello and Haddadi similar rules had been regarded as violating EU primarily law, esp. the principle of non-discrimination.

In “Sahyouni” the BGH concluded that both cases were not relevant. The second (and probably non-effective) nationality of both spouses was the Syrian, a non-EU nationality. Thus, the principle of non-discrimination did not apply. Therefore, German law applied on the case. German law does not allow a “private divorce”. For that reason, the divorce was regarded as invalid in Germany.

1. Unilateral divorces and public policy

Finally, the court took the opportunity to mention that the poblic policy exception also would have made the divorce invalid: Article 10 Rome III was not applicable, thus, Article 6 EGBGB (English) would have applied. Contrary to Article 10, Article 6 requires an analysis of the concrete result of the application of the lex causae to determine whether this result violates fundamental principles/values of the German legal system. In Germany, divorces by unilateral declarations (such as talaq or ghet) can be regarded as not violating the German ordre public, especially if both spouses agree on the divorce. From the facts of the case the BGH concluded that in “Sahyouni” the wife did not wish for divorce. For that reason, the recognition of the unilateral declaration would violate the German public policy (“would” as this argument was not decisive for the case – as aforementioned, German law applied).

Written by Giesela Rühl, Humboldt-University of Berlin

 

The protection of human rights in global supply chains has been high on the agenda of national legislatures for a number of years. Most recently, also the European Union has joined the bandwagon. After Commissioner for Justice Didier Reynders announced plans to prepare a European human rights to due diligence instrument in April 2020, the JURI Committee of the European Parliament has now published a Draft Report on corporate due diligence and corporate accountability. The Report contains a motion for a European Parliament Resolution and a Proposal for a Directive which will, if adopted, require European companies – and companies operating in Europe – to undertake broad mandatory human rights due diligence along the entire supply chain. Violations will result, among others, in a right of victims to claim damages.

The proposed Directive is remarkable because it amounts to the first attempt of the European legislature to establish cross-sectoral mandatory human rights due diligence obligations coupled with a mandatory civil liability regime. However, from a private international law perspective the Draft Report attracts attention because it also contains proposals to change the Brussels Ia Regulation and the Rome II Regulation. In this post I will briefly discuss – and criticize – the proposed changes to the Rome II Regulation. For a discussion of the changes to the Brussels Ia Regulation I refer to Geert Van Calster’s thoughts on GAVC.

Victims’ unilateral right to choose the applicable law

The proposed change to the Rome II Regulation envisions the introduction of a new Article 6a entitled “Business-related human rights claims”. Clearly modelled on Article 7 Rome II Regulation relating to environmental damage the proposal allows victims of human rights violations to choose the applicable law. However, unlike Article 7 Rome II Regulation, which limits the choice to the law of the place of injury and the law of the place of action, the proposed Article 6a allows victims of human rights violations to choose between potentially four different laws, namely

1) the law of the country in which the damage occurred, i.e. the law of the place of injury,

2) the law of the country in which the event giving rise to damage occurred, i.e. the law of the place of action,

3) the law of the country in which the parent company has its domicile or, where the parent company does not have a domicile in a Member State,

4) the law of the country where the parent company operates.

The rationale behind the proposed Article 6a Rome II Regulation is clear: The JURI Committee tries to make sure that the substantive provisions of the proposed Directive will actually apply – and not fall prey to Article 4(1) Rome II Regulation which, in typical supply chain cases, leads to application of the law of the host state in the Global South and, hence, non-EU law. By allowing victims to choose the applicable law, notably the law  of the (European) parent company, the JURI Committee takes up recommendations that have been made in the literature over the past years.

However, a right to choose the applicable law ex post – while certainly good for victims – is conceptually ill-conceived because it results in legal uncertainty for all companies that try to find out ex ante what their obligations are. Provisions like the proposed Article 6a Rome II Regulation, therefore, fundamentally impair the deterrence function of tort law and increase compliance costs for companies because they have to adjust their behaviour to four – potentially – different laws to avoid liability. It is for this reason that choice of law rules that allow one party to unilaterally choose the applicable law ex post have largely (even though not completely) fallen out of favour.

Alternative roads to European law

The proposed Article 6a Rome II Regulation, however, does not only fail to convince conceptually. It also fails to convince as regards to the purpose that it seeks to achieve. In fact, there are much better ways to ensure that European standards apply in supply chain cases. The most obvious way is to simply adopt the envisioned European instrument in the form of a Regulation. Its provisions would then have to be applied as international uniform law by all Member State courts – irrespective of the provisions of the Rome II Regulation. However, even if the European legislature prefers to adopt a European instrument in the form of a Directive – for political or competence reasons –, no change of the Rome II Regulation is necessary to ensure that it is applied throughout Europe. In fact, its provisions can simply be classified as overriding mandatory provisions in the meaning of Article 16 Rome II Regulation. The national provisions implementing the Directive will then apply irrespective of the otherwise applicable law.

In the light of the above, application of European human rights due diligence standards can be ensured without amending the Rome II Regulation. It is, therefore, recommended that the JURI Committee rethinks – and then abandons – the proposed Article 6a Rome II Regulation.

 

Note: This post is also available via the blog of the European Association of Private International Law.

A foreign judgment is generally not to be reviewed on the merits at the recognition and enforcement stage. Yet, an exception has always been carved out for fraud under the common law rules on the basis that ‘fraud unravels everything’ (Lazarus Estates Ltd v Beasley [1956] 1 QB 702, 712 per Lord Denning). Thus, English courts allow a judgment debtor to raise fraud at the recognition and enforcement stage even if no new evidence is adduced and fraud had been considered and dismissed by the court of origin (Abouloff v Oppenheimer & Co (1882) 10 QBD 295). This seeming anomaly with the prohibition against a review of the merits of a foreign judgment has been justified on the basis that where fraud is concerned, the court of origin is misled, not mistaken (Abouloff). The Abouloff rule has been much criticized, but successive courts have refused to depart from it (see also Altimo Holdings and Investment Ltd v Kyrgyz Mobil Tel Ltd [2011] UKPC 7, [2012] 1 WLR 1804, [116] (Privy Council)). Further, in Takhar v Gracefield Developments Ltd ([2019] UKSC 13, [2020] AC 450) which is a case on fraud and domestic judgments, the Supreme Court held that, generally, no requirement that the fraud could not have been uncovered with reasonable diligence in advance of obtaining the judgment would be imposed on the party seeking to set aside the judgment on the basis of fraud. As one of the oft-cited criticisms for the Abouloff rule is that it is out of step with how English courts deal with domestic judgments, Takhar may have the effect of further embedding the Abouloff rule.

In Hong Pian Tee v Les Placements Germain Gauthier ([2002] SGCA 17, [2002] 1 SLR(R) 515), the Singapore Court of Appeal criticized the Abouloff rule on the basis that it would encourage ‘endless litigation’ and ‘judicial chauvinism’ (at [27]-[28]). Drawing on Canadian and Australian authorities on fraud and foreign judgments, the Court held that insofar as intrinsic fraud (ie, fraud which goes to the merits of the case) is concerned, the foreign judgment may only be impeached where ‘fresh evidence has come to light which reasonable diligence on the part of the defendant would not have uncovered and the fresh evidence would have been likely to make a difference in the eventual result of the case’ (at [30]).

The current position on fraud and domestic judgments under Singapore law is that the fresh evidence rule applies, albeit flexibly (see, eg, Su Sh-Hsyu v Wee Yue Chew [2007] SGCA 31, [2007] 3 SLR(R) 673). However, the Court of Appeal recently considered Takhar in a decision concerning a domestic adjudication determination (AD). Adjudication is available under the Building and Construction Industry Security of Payment Act (Cap 30B, Rev Ed 2006) and is a quick and inexpensive process to resolve payment disputes arising from building and construction contracts. In Facade Solution Pte Ltd v Mero Asia Pacific Pte Ltd ([2020] SGCA 88), the Court of Appeal held that an AD could be set aside on the ground of fraud. The party raising fraud would have to establish that the facts which were relied on by the adjudicator were false; that the other party either knew or ought reasonably to have known them to be false; and that the innocent party did not in fact, subjectively know or have actual knowledge of the true position throughout the adjudication proceedings (at [30]). The Court emphasised that ‘there is no requirement on the innocent party to show that the evidence of fraud could not have been obtained or discovered with reasonable diligence during the adjudication proceeding’ (at [31]). It cited Takhar and the High Court of Australia decision of Clone Pty Ltd v Players Pty Ltd (in Liquidation) [2018] HCA 12 with approval, the High Court of Australia having also rejected the reasonable diligence requirement in the context of a fraudulently obtained domestic judgment in the latter case.

The Court held (at [33]; emphasis added):

‘Where it is established that an AD is infected by fraud, it is neither material nor relevant to inquire as to whether the innocent party could have discovered the truth by the exercise of reasonable diligence. A fraudulent party cannot be allowed to claim that he could have been caught had reasonable diligence been exercised, but because he was not caught, he should be allowed to get away with it. Such a view would bring the administration of justice into disrepute and it would be unprincipled to hold in effect that there is no sanction on the fraudulent party because he could have been found out earlier. Parties dealing with the court, and in the same vein, with the adjudicator in the adjudication of their disputes under the Act are expected to act with utmost probity.’

This passage suggests that the position on fraud and domestic judgments would change in the near future. It also raises the question whether the requirement of reasonable diligence in respect of intrinsic fraud and foreign judgments would survive for long. On the one hand, the Court in Hong Pian Tee had said that: ‘There is no logical reason why a different rule should apply in relation to a foreign judgment’ (at [27]) (ie, vis-à-vis a domestic judgment). The requirement of reasonable diligence has also been criticized on the basis that the court would be ‘taking the side of the fraudster against his negligent opponent’ (Briggs, ‘Crossing the River by Feeling the Stones; Rethinking the Law on Foreign Judgments’ (2005) 8 SYBIL 1, 21). On the other hand, there was a heavy emphasis on judicial comity in Hong Pian Tee. The Court observed that: ‘It is … vitally important that no court of one jurisdiction should pass judgment on an issue already decided upon by a competent court of another jurisdiction …. It must be borne in mind that the enforcement forum is not an appellate tribunal vis-à-vis the foreign judgment’ (at [28]).

It remains to be seen whether the Singapore Court of Appeal would in future resile from Hong Pian Tee. At least, the recent developments in the domestic context intimate that the point is arguable.

5 pm Argentinian time.
Registration here.

The US Supreme Court will hear oral arguments today (7-Oct-2020) concerning two consolidated cases: Ford Motor Co. v. Montana Eighth Judicial District Court and Ford Motor Co. v. Bandemer. The consolidated cases deal with the difficult issue of personal jurisdiction over a non-resident defendant, where there is a split in federal courts of appeals and state courts of last resort. These cases are significant because they will have a direct impact on the ease with which plaintiffs can lodge a complaint in product liability cases against big automobile companies (and others) before the courts of their own state. In a nutshell, it can be argued that besides jurisdictional matters relating to the defendant, these cases deal with fundamental notions of access to justice for consumers.

The oral argument was originally scheduled for April 2020 but given the Covid-19 pandemic was rescheduled for the October 2020 term. Please note that the Supreme Court can hear oral arguments even though they are currently only 8 justices. According to Rule 4 of the Supreme Court of the United States, six Members of the Court constitute a quorum. Nevertheless, complications may arise if there is a 4-4 split during the deliberations. Given the great experience and expertise of Justice Ginsburg in this area (see our previous post here), it is a pity that she could not partake in this oral argument and decision, and she will be greatly missed.

Below I include the question presented. More information will follow soon, stay tuned!

Petition for a writ of certiorari on behalf of Ford Motor Company

“The Due Process Clause permits a state court to exercise specific personal jurisdiction over a non-resident defendant only when the plaintiff’s claims “arise out of or relate to” the defendant’s forum activities. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472 (1985) (internal quotation marks omitted).”

The question presented is:

“Whether the “arise out of or relate to” requirement is met when none of the defendant’s forum contacts caused the plaintiff’s claims, such that the plaintiff’s claims would be the same even if the defendant had no forum contacts.”