Transcript Lis alibi pendens - Thuisblad van Matthias E. Storme

International procedure
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Overview of issues:
Jurisdiction of courts (incl. issue of lis pendens)
Service abroad
Specific rules for cross-border disputes (incl. possible use
of harmonised rules of procedure)
Application of foreign law
Taking evidence abroad
Recognition and enforcement of foreign judgments or
other instruments
Insolvency procedures
International procedure sources
Sources in general
 National law on jurisdiction, service, procedure
incl. evidence of facts and law, insolvency
proceedings, recognition and enforcement
 In part replaced by EU legislation (esp.
Regulations)
 Multilateral and bilateral conventions
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NB. For immunities of jurisdiction, see Ch. 1
Reasons for choice
Why does it matter ? What do you pay attention to when choosing a forum
?
 Proximity-familiarity of a party (or its lawyer) with the court > predictability
at less costs
 Procedural reasons:
different rules of procedure, incl. rules on taking evidence, on confidentiality
use of language,
costs and distribution of costs : ‘American rule’ (each party its own costs)
v. fee-shifting (eg ‘English rule’ loser pays all, mitigated since 2013, as in
most continental countries)
contingency fees ? Allowed in mist US states, forbidden in most continental
systems, in E&W to some extent allowed. But conditional fee agreements or
success fees usually allowed.
trust in the judges,
proximity of evidence (incl. presence of witnesses)
trust in law firms
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Reasons for choice
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Why does it matter ? What do you pay attention to when choosing a forum
?
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Substantive reasons:
applicable rules of the lex fori, esp. those overruling choice of law
(supermandatory rules)
Court of the country of the applicable law will know that law better > more
predictable
« national » interpretation of foreign or uniform law
Possible home bias (eg interpretation of conformity of goods)
remedies courts in that country (can) grant (eg specific performance;
injunctions; post-decision discovery of assets (eg NML/Argentina))
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Chances of recognition and enforcement abroad
International jurisdiction
Domestic rules on international jurisdiction of national
courts (in Belgium in Code of P.I.L.):
- often rather wide jurisdiction,
e.g. based also on *nationality of claimant * foreign
defendant found in the country, *foreign defendant
doing business in the country, etc.;
- sometimes limited by « FNC » (forum non conveniens)
- sometimes protected by anti-suit injunctions against
proceedings abroad (eg Gallo Winery t. Andina, case in
US against exorbitant jurisdiction rule in Ecuador)
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Lis alibi pendens not always an exception or ground for
suspension
International jurisdiction
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Domestic rules on international jurisdiction limited by:
International conventions (bilateral or multilateral) (no uniform
interpretation authority)
Hague Convention on Choice of Court Agreements 2005 (expected
to enter into force Sep 2015 for EU (without Denmark) and Mexico:
also signed by US and Singapore)
Hague Conference preliminary negotiations (2012) for a Judgments
Convention
CMR art. 31
International convenions establishing international or common
courts (eg European patent Court, Benelux Court)
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EU-Regulations: next slide - uniform interpretation by ECJ
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Lugano Convention 1988, revised 2007: EU-EFTA Convention (CH,
N, Iceland) parallel to EU-Regulation 44/2001 (incl. an endeavour to
interpret in conformity with identical rules in EU Regulation)
International jurisdiction - EU
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EU-Regulations:
Civil and commercial matters in general: Reg. 1215/2012 (« Brussels-I bis
(‘Recast’) (next slide)
Separate Regulations on matrimonial matters and parental responsibility
Brussels-II), maintenance obligations (alimony), on transnational
successions (650/2012)
Regulation on insolvency proceedings 1346/2000 (+ recast expected 2015)
(s. further)
Purpose of these rules:
« Free movement of judgments », i.e. recognition and enforcement of
judgments from other member states (in the USA: full faith and credit)
To reach this, harmonisation of international jurisdiction is required
EU – Brussels I Reg - Scope
EU-Regulations - Civil and commercial matters in general:
 originally Brussels Convention 1968, still relevant for overseas territories of
art. 355 TFEU:
 until Jan. 10, 2015 Old Brussels-I-Reg. 44/2001.
 Now Reg. 1215/2012 (« Brussels-I bis (‘Recast’)
 Scope ratione materiae - excluded matters:
family & succession (separate Regulations),
social security,
jurisdiction over arbitration
Excluded is therefore also judging the validity of arbitration agreements:
- jurisdiction rules left to national law;
- no recognition on the basis of Brussels-I;
- thus: a judgment not recognising an arbitration clause is not binding in
other MS as to the arbitration clause)
- proceedings ancillary to arbitration also outside Brussels-Ibis
 Relationship with other courts common to some member states (EPC,
Benelux Court) in art. 71a ff.
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EU – Brussels I Reg - Scope
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New Brussels-I-Regulation 1215/2012 (Old = 44/2001)
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Scope of application ratione personae
Regulates only procedures where a defendant is domiciled in a MS;
otherwise: national procedural law applies (art. 6 (old 4.2)) (s. infra
Hague Convention on Choice of Court Agreements)
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Definition of domicile:
- of natural persons: art. 62 (old 59)) > national law (not autonomous)
(><in other regulations, habitual residence is used, an autonomous
concept)
- of legal persons: autonomous definition; alternative grounds (art. 63
(old 60))
 If residence unknown, last known residence may be used (C327/10, Hypotecni banka / Lindner)
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EU – Brussels I Reg - Scope
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Brussels-I-Regulation Recast 1215/2012 (in force Jan 10, 2015)
(until then 44/2001)- Scope of application ratione personae
Only « international » cases. See however C-478/12 Maletic: when
consumer can sue travel organisator before court of its domicile, he
can also sue the travel intermediary with a seat elsewhere in his
country before the first court (although the latter relationship
viewed in isolation is not international)
Extensions in Recast 1215/2012: also when defendant not domiciled
in a MS:
Jurisdiction over consumer contracts (art. 18 I)
Jurisdiction over individual employment contracts (art.21)
Matters of exclusive jurisdiction (art. 24)
(valid) Choice of forum of a court in a member state (art. 25)
Outside these cases, national procedural law determines whether a
non-EU defendant can be sued in eg proceedings against an EUdefendant
EU – Brussels I - General
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General characteristics:
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Hard & strict rules
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Restrictive interpretation of any deviation from the basic rule «court
of the defendant» (against a forum actoris = home play)
No doctrine of «forum non conveniens» (FNC) - ECJ in C-281/02
Owusu (British tourist in Jamaica tort case, sues also travel agent in
UK as ‘anchor defendant’)
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Court examines jurisdiction ex officio (art. 27 ff., old 25 ff.)
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No anti-suit injunctions (next slide)
EU – Brussels I - General
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General characteristics (cont.)
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No «anti-suit injunction» allowed: ECJ in C-159/02 Turner (not even
by court seised first) and in C-185/2007 West tankers (not even in
relation to arbitration) (disputed whether the latter remains under
the new 1215/2012 Regulation);
C-563/13 Gazprom/Lithuania: whether a court should recognise or
not a so-called anti-suit order by arbitrators is outside scope of
Brussels-I and governed by national procedural law.
In the Alexandros case (Starlight Shipping/Allianz Marine), the UKSC
(6 Nov 2013) did decide that Brussels-I (art. 27 old) and pending
proceedings in Greece did not bar in England a claim for damages
for breach of the jurisdiction agreement and an earlier settlement.
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Brussels-I Excl. jurisdiction
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Brussels-I-Regulation – Grounds for jurisdiction:
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Some cases of exclusive jurisdiction (no choice of court
possible):
Real estate: proprietary rights in immovable property +
tenancy in immovable property (art. 24.1, old 22.1)
Matters of the law of companies and other legal persons
(24.2, old 22.2)
Entries in public registers (24.3, old 22.3)
Intellectual property rights (24.4, old 22.4)
Enforcement (24.5, old 22.5)
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Brussels I Choice of court
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Effect of choice of court agreements: Art. 25 (old 23). It must be
recognised if:
1° Old Reg.: at least one party domiciled in a member state - no
longer required in new art. 25;
2° consent of the parties is clear*. Also in case of conferral in a
trust instrument (art. 25.3 with exceptions in 25.4). See next slide
on validity;
3° in writing (incl. e-communication) or in another form customary
in international trade or according to practices between the parties;
e.g.:? Clause in conditions of issue of bonds or other financial
instruments. Sufficient: online click-wrap (C-322/14 El Majdoub)
4° indicating a court or the courts of a member state.
* Disputed whether third party deriving rights from a contract is
also bound by choice of court. Cass.(Fr) 4 Jan 2005: addressee in
transport contract is not bound. ECJ: holder of bill of lading bound
(C-71/83, Russ), future shareholders (C-214/89 Powell Duffryn), not
later buyer wth direct action (C-543/10 Refcomp)
Brussels I Choice of court
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Problem under old Reg: no priority for designated court. If however,
a court declines juridiction because of forum clause, courts in other
MS are bound (C-456/11 Gothaer allgemeine/Samskip)
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New Brussels Ibis: The designated judge will judge (the
effectiveness of) the choice of court agreement
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Validity of choice of court agreements
Formal validity: uniform rule for all member states in Regulation
itself; see supra
Validity of choice of court agreements to be assessed separately
from the rest of the contract (art. 25.6)
Validity to be judged by the law of the designated forum (art. 25.1:
lex fori prorogati), including its conflict of law rules (Consideration
20: renvoi possible), thus by the law applicable by virtue of the
conflict of law rules of the designated forum
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Brussels-I Choice of court
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Exceptions to choice of court agreements
Excluded in cases of exclusive jurisdiction (art. 24, old 22)
Limited in insurance, consumer and labour disputes (see art. 15, 19,
23) (old 13 c.q. 17 c.q. 21)
Overrules national restrictions (eg. Rules on jurisdiction in cases of
Distributorship or Commercial Agency in belian Econiomic Law
Code) (but see next slide for cases outside the Regulation)
Some restrictions in other treaties remain (eg CMR Convention)
Validity of unilateral optional forum clauses ? Rejected i.a. in France
Cass.(Fr.) 26 Sep 2012 & 25 March 2015; accepted in the UK.
Voluntary appearance of defendant without protest (art. 26, old 24)
(except cases of exclusive jurisdiction under art. 24, old 22)
National law on choice of court
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Quid if designated Court is outside EU ?
Outside the scope of Brussels-I-Reg > national law (unless another Treaty
applies, see next slide on Hague Convention)
 National restrictions thus apply, esp. in case of overriding mandatory
provisions of substantive law (e.g. Agency, Distributorship)
(See also the same question as to arbitration clauses)
Explicit provisions in e.g. Belgian law: Belgian Courts always competent for
cases of termination of commercial agency or distributorship
2 Possible approaches: either ex ante rejection of the choice of court if the
foreign court is not obliged to apply the mandatory provisions, or ex post
non-recognition if the foreign court has not done so (+ stay domestic case
on the basis of recognition prognosis)
BGH 30 Jan 1961; recently BGH 5 Sep 2012, Virginia agency case: ex ante
rejection. Although American Courts would probably apply German law on
the basis of the comparative impairment doctrine (§ 187(2) US
restatement 2nd of Conflict of Laws)
English High Court in Accentuate Ltd v Asgira: idem (arbitration clause)
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Choice of court – Hague C
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Choice of Court Agreements – Hague Convention 2005 (enters into
force Sep 2015, ratified by Mexico, ratified by EU (w/o Denmark) 4
Dec 2014, signed by US and Singapore):
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Art. 1: defines « international cases »
Art. 2: outside scope of application: consumer cases, labour cases,
family law, successions, insolvency, competition, most tort cases,
property in land, legal persons, most intellectual property cases, etc.
Art. 3 a) applies (only) where the agreement indicates a Court of a
contracting state
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Relationship with Brussels-I: Hague has priority applies as soon as
one of the parties is domiciled in a Hague state, unless both parties
are domiciled in the EU
Choice of court – Hague C
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Choice of Court Agreements – Hague Convention 2005:
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Art. 3 formal requirements: in writing or by any other means of
communication that renders information accessible so as to be
usable for subsequent reference
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Art. 5: substantive validity to be determined under the law of the
chosen court (lex fori prorogati)
Choice of court – Hague C
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Choice of Court Agreements Hague Convention 2005 - effects
Art. 5: Chosen court* must hear the case, unless it finds the
agreement invalid; Art. 5: validity under the law of the chosen court
* More precisely: chosen court system (state basis) (transfer to other
court of same state system remains possible)
 Any not-named court must decline jurisdiction (unless named court
has declined)
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Convention does not govern interim measures (art. 7)
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Recognition and enforcement may only be refused on the grounds
of art. 9 (i.a. art. 11 punitive damages, cfr. existing case law in
Germany, France, Italy)
Brussels-I general rules
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Grounds for jurisdiction (cont.)
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Basic rule: domicile of the defendant (rule against forum actoris)
(Art. 4, old 2)
Art. 8.1 (old 6.1.) Plurality of defendants if closely linked
(requirement of reasonable foreseeability in ECJ C-145/10 Painer,
(violation of privacy by media), taken over in Recast 1215/2012)
(but for defendants outside EU, national law determines this)
Exception where claimant and anchor defendant collude to artificially
create the basis for jurisdiction (C-352/13 Cartel Damage Claims) (s.
also C-103/05 Reisch Montage)
 Art. 8.3 (old 6.3): Counterclaims: same court
 Art. 8.2 (old 6.2): Third party intervention: possible in same court
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Brussels-I
provisional measures
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Provisional measures: art. 35 (old 31)
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may be demanded in the country where they can/must be
performed/enforced
condition is that they are provisional - restrictive interpretation of
« provisional measure »: only « conservatory measures » (ECJ in C104/2003), incl. obtaining information or preserving evidence
Does not include eg ordering the hearing of a witness (but a court
has jurisdiction for such measures if asked by the court having
jurisdiction over substance, see further Reg. 1206/2011 on
evidence)
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BUT: Territorial scope: see infra recognition/enforcement (only
measures by court having jurisdiction over substance, have effect
on other MS).
Alternative jurisdiction:
contracts
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Brussels-I-Regulation – grounds for jurisdiction (contracts)
Alternative grounds on which claimant can base jurisdiction:
art. 7.1.a. (old 5.1.a) claim based on a contractual obligation and
other ‘matters related to a contract’:
place of performance of the obligation (as determined by the substantive
law applicable to the obligation) (secondary obligations follow the principal
obligation)
 Contractual obligation includes tort claims where the conduct complained of
may be considered breach of contract terms (C-548/12, Brogsitter)
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art. 7.1.b (old 5.1.b) in sales and service contracts
> a more specific and autonomous rule: place of delivery c.q.
provision of service or place where should have been
delivered/provided.
To be determined by interpreting the contract, taking into account also
« including terms and clauses which are generally recognised and applied
through the usages of international trade or commerce, such as the
Incoterms » (C-87/10 Electrosteel). If that does not help, place of factual
delivery (C-381/08 Car Trim)
Alternative jurisdiction: torts
Brussels-I-Regulation –Alternative grounds on which claimant can base
jurisdiction – tort:
 Art. 7.2 (old 5.3) Claim based on a non-contractual obligation from tort:
place where the harmful event occurred.
In general, this can be the place where the event was caused (locus acti) or
where the damage occurs (locus damni) (C-21/76 Bier /Mines de Potasse).
For a defective product: where it is produced or where damage is caused,
not where it is merely marketed C-45/13 Kainz)
Also possible for negative declarations on liability in tort (C-133/11 Folien
Fischer) > incentive for defendant to go to court first
For damage to personality rights worldwide: full jurisdiction for country
where act is committed and country of centre of main interest of damaged
person; partial jurisdiction for other countries where damage is caused (C509/09 eDate advertising)
Damage to personality rights by press (C-68/93, Shevill) or damage to IP
rights (including on internet) (C-523/10 Wintersteiger; C-441/13 Hejduk):
full jurisdiction for country where act is committed; partial jurisdiction for
other countries where damage was caused.
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Alternative jurisdiction other
Brussels-I-Regulation – grounds for jurisdiction
 Alternative grounds on which claimant can base jurisdiction:
 7.5. (old 5.5) Disputes arising out of the operations of a branch,
agency or other establishment: its location
 10-16 (old 8-14) Insurance contracts litigation
 17-19 (old 15-17) Consumer contracts litigation in 3 cases
- (a) a contract for the sale of goods on instalment credit terms;
- (b) a contract for a loan repayable by instalments, or for any other
form of credit, made to finance the sale of goods; or
- (c) the contract has been concluded with a person who pursues
commercial or professional activities in the MS of the consumer's
domicile or, by any means, directs such activities to that MS or to
several States including that MS (NB. no requirement that contract
is concluded as distance contract: C-190/11 Mühlleitner / Autohaus
Yusufi)
 20-23 (old 18-21) Labour contracts litigation
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Alternative jurisdiction: general
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Restrictive interpretation of alternative grounds
eg succeeding party such as assignee*, subrogated
party** cannot use the alternative jurisdiction (except
when it personally meets the requirements)
* C-89/91 Shearson Lehman Hutton
• ** C-347/08 Vorarlberger Gebietskrankenkasse
•
Lis alibi pendens in EU
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Brussels-I-Regulation – further rules on jurisdiction
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Lis alibi pendens in other MS (art. 29, old 27) – Scope of
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application:
same claim (same cause of action) between same parties**
already* before another court
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* Date of seizure autonomously defined (art. 32, old 30): claim filed
at court or claim received by the servicing authority (see further the
rules on servicing abroad)
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** C-452/12 Nipponkoa: where there a claim for a declaration of
non-liability is already pending, a recourse by the insurer of the
defendant who has paid a third party falls within the scope of lis
pendens.
Lis alibi pendens in EU
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Brussels-I-Regulation – further rules on jurisdiction
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Lis alibi pendens in other MS (art. 29, old 27) - Effects:
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Old regulation: later court must suspend/stay proceedings until
court first seised has decided (and must decline jurisdiction if first
court decides it has jurisdiction). First court has
Kompetenzkompetenz (even on the question whether there is a
choice for court agreement naming another court) (ECJ C-116/02,
Gasser).
This is not the case when the court seised later has exclusive
jurisdiction on the basis of Ch. II. S. 3 (insurance), 4 (consumer) or
art. 24 (old 22) (ECJ C-438/12 Weber/Weber)
New rule in Brussels Ibis art. 31.2: where another court is seised on
the basis of a choice of court agreement, that court has to decide
first: named court has Kompetenzkompetenz
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Lis alibi pendens in EU
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Brussels-I-Regulation – further rules on jurisdiction
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Lis alibi pendens and arbitration
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No suspension if there is arbitration agreement, even if
arbitration proceedings already pending
the wide exclusion of arbitration from the scope in the
Recast (s. supra) also means that the fact that the
validity of an arbitration agreement is already pending
before one court not deprive other courts of jurisdiction !
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Lis alibi pendens extra EU
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Brussels-I-Regulation – further rules on jurisdiction
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new in Recast 1215/2012 art. 33:
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Lis alibi pendens in non-EU court : later EU court may
suspend proceedings. Here the forum non conveniens
doctrine is used.
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Decision of non-EU Court with res iudicata: EU court will
dismiss the proceedings if the non-EU judgment is
capable of recognition (new art. 33.3)
Connex case pending
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Brussels-I-Regulation – further rules on jurisdiction
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Connexity (connected or related cases): later court MAY
suspend or refer the case (no obligation) (art. 30, old
28)
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Connexity with case in non-EU court (new in Recast
1215/2012 art. 34)
US jurisdiction
International jurisdiction of US Courts: mostly wide rules of jurisdiction but
with many or wide exceptions
 Grounds for jurisdiction: it is sufficient that there is a contact in personam
or in rem with the state concerned
- Jurisdiction in personam: very broadly formulated – mere presence of the
defendant (domicile, citizenship, temporary presence, doing business) or
consent of the defendant (choice of court agreement). Restricted by SCotUS
in Daimler v Bauman (Jan 14, 2014): general jurisdiction only in home state
of defendant; otherwise only specific jurisdiction for claims linked to the
place
Jurisdiction in rem: dispute over property in an asset situated in that state.
 Exceptions / Limitations to jurisdiction:
Choice of Court Agreement (widely accepted – SC 3 Dec 2013 in Atlantic
Marine Construction)
Defendant fraudulently lured into the jurisdiction (invited for dinner)
Forum non conveniens (rarely accepted !, Gilbert case 1947)
Lis alibi pendens: «first filed rule»
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UK jurisdiction
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International jurisdiction of English Courts outside Brussels I-bis > domestic
law
Common law tradition: mostly wide rules of jurisdiction but with many or
wide exceptions
 Including wide jurisdiction in personam
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Servicing docs. abroad
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Service abroad of judicial documents
Hague Convention 1965 on the service abroad of judicial and
extrajudicial documents in civil and commercial matters: crossborder service to a known address:
can take place via the «central authorities» of the contracting
states;
a direct service abroad is possible in certain cases.
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EU Regulation 1393/2007 on service between member states: next
slide
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Matters outside these Conventions/Regulations: regulated by
domestic law (usually via bailiff + postal service)
Servicing docs. abroad
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EU Regulation 1393/2007 on service between member states:
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transmission via central authorities (art. 4 ff.) (standard forms);
alternative forms in art. 12 ff;
direct service by officials in the MS addressed if this is permitted by
the law of that State (art. 15)
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C-473/04 Plumex: no hierarchy between these alternatives
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adressee may refuse to accept if neither in the official language of
the place of destination nor in a language easily understood by
defendant (art. 8)
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Additional rules in specific regulations (eg Small Claims Regulation)
Cross-border procedures
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National law may have specific rules of procedure for cross-border
litigation (rare, except EU-Regulations mentioned infra)
If such rules are restrictive, they may be set aside by EU law, e.g.
the requirement of a Cautio iudicatum solvi for foreign claimants
EU: proposals of the Storme-Commission 1994
Some largely uniform procedures for cross-border litigation
introduced in the law of all EU member states:
Small claims Regulation (Reg. 861/2007)
Payment order Regulation (Reg. 1896/2006)
New Regulation on attachment of bank accounts (“European
Account Preservation Order”)
Model law by ALI/Unidroit Principles of transnational civil procedure
(Principles + Annex with “Rules”)
Applying foreign law
What is the task of the judge when according to the conflict of law
rule, foreign law must be applied ?
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Continental rule: curia novit ius, applies also to the foreign law
indicated by the domestic conflict rule. Judge may obtain
information according to the European Convention on Information
on Foreign Law (London 1968) (not frequently used). More
frequent: expert opinion on foreign law
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Anglo-American rule: foreign law is a matter of fact that must be
proven (usually by expert opinion, esp. affidavit by qualified foreign
lawyer)
Evidence - problems
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Applicable law:
rules on means of proof accepted for certain facts, eg contracts: the
applicable substantive law
rules on obtaining evidence: domestic procedural law (lex fori).
Procedural law of evidence differs a lot, e.g. concerning discovery
(actio ad exhibendum):
continental rule: restricted to specific documents
>< in USA: much broader («fishing expeditions»)
Means of proof especially relevant in international trade: expert
examinations; certificates or reports of control/surveillance
organisations, etc.
- Parties may use the ICC Rules for Experts (deal with proposal of
experts by ICC, appointment rules, administration rules) (see Ch.
12)
Evidence
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Taking evidence abroad
Unilaterally:
supposes voluntary compliance
in some cases compliance is even forbidden (by « blocking
statutes » or by a specific court order) except where information is
exported on the basis of international conventions (as the Hague
Convention, next slide)
Eg French Law 80-538 of 16 July 1980 (originally reaction against american action
against shipping cartels): communication of economic, commercial, industrial,
financial or technical information is prohibited
-- if capable of harming the sovereignty, security or essential economic interests of
France or contravening public policy;
-- if leading to establishment of proof in foreign legal proceedings.
Eg Swiss Banking law (bank secrecy)
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That prohibition sometimes set aside by foreign court:
-eg E&WC.A. 22 Oct 2013: recourse to the Evidence Regulation not necessary
-SCotUS uses different tests to decide whether or no to respect the foreign statute
and use the lex fori or the Hague Convention (SC 15 June 1987 in Aérospatiale v
US)
Evidence
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Taking evidence abroad
Rogatory Commissions sent abroad (for examination of witnesses,
visit of a location abroad, etc.)
 Hague Convention on Taking Evidence Abroad 1970 (in force 1972)
- via a central authority in the requested state
- or via personnel of the requesting state in the requested state in
case of voluntary appearance of the requested persons
- most states made a reservation for pre-trial discovery (based on art.
23 Convention) (even the UK made the reservation)
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EU-Regulation 1206/2001 on co-operation in taking of evidence:
next slide
Evidence – EU Reg.
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EU-Regulation 1206/2001 on co-operation in taking of evidence
demand directly adressed by «requesting court» to «requested
court» in other member state; use of standard forms; subsidiary
role of a central body in each member state.
Directive only facilitates taking evidence, thus does not forbid any
measure which can be taken without the cooperation of the other
member state:
- C-170/11, Lippens e.a.: Court has the option, to summon a person residing in another
Member State before it and hear him as a witness in accordance with the law of its
Member State.
- C-332/11 Prorail: entrusting to an expert a task of taking of evidence to be carried out
in another Member State, can be done without this procedure, unless it affect the
powers of the Member State in which it takes place, in particular where it is an
investigation carried out in places connected to the exercise of such powers or in
places to which access or other action is, under the law of the Member State in which
the investigation is carried out, prohibited or restricted to certain persons.
Recognition & enforcement
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Deals with so-called « Title import »
Within federal states: « Full faith and credit »
Otherwise traditionally re-examination of the case in country where
recognition / enforcement is asked, unless simplified by treaties
Eg in Belgium simplified since 2004 (Code of PIL art. 25 § 1
abolishes re-examination and lists grounds for refusal)
Eg in the UK: common law rules + Statutes 1920 & 1933 mainly
dealing with commonwealth countries
No global convention until now (only for Choice of Court
Agreements (supra), including rules on recognition and
enforcement)
CMR art. 31
In the EU:
certain judgments from courts of other EU states enjoy full faith and
credit (automatically enforceable),
for others under Reg. 44/2001 a simplified procedure of
« exequatur », now abolished by Brussels-I Recast 1215/2012
Recognition & enforcement
General framework: Brussels-I-Regulation (+ separate regulations in family,
maintenance obligations, successions, insolvency, etc.)
 Old rules: automatic recognition of judgments* / enforcement after
obtaining an exequatur** on unilateral request with certain formalities (art.
41) (« title inspection »)
* limited grounds for refusal in case of opposition/appeal (art. 34-35)
- contrary to public policy (34.1) (interpreted restrictively by ECJ)
- judgment in default and defendant not served in sufficient time (34.2)
- incompatible with a judgment issued in the country of enforcement (34.3
& 4)
- from a court having no jurisdiction in case of conflict with section 3,4 or 6
of Ch. II or in case of art. 72 (special conventions) (art. 35)
- see also art. 61 (Recast 64 )(civil decision in criminal proceedings,
defendant had no opportunity to arrange defence)
* Q: is an English Scheme of Arrangement a judgment in the sense of art. 32 ?
** without re-examination or review of the merits (art. 53)
NY Convention on arbitration takes precedence over the Regulation

Recognition & enforcement



-
-
General framework: Brussels-I-Regulation
Old rules (44/2001):
Automatic enforceability without exequatur in case of:
European Enforcement order for uncontested claims (Reg.
805/2004) awarded in a procedure according to domestic law of a
member state
European Payment Orders (supra)
Decisions in European Small Claims Procedures (supra)
Recognition & enforcement
General framework: Brussels-I-Regulation
 New rules (Recast 1215/2012):
 automatic recognition and enforcement without obtaining an exequatur, on
presentation of judgment + certificate with summary (and possibly
translations) (one coudl say: exequatur is granted by the country of origin).
Enforcement requires prior serving of certificate to that person.
 Same limited grounds for refusal in case of opposition/appeal :
- contrary to public policy (45.1a) (interpreted restrictively by ECJ)
- judgment in default and defendant not served in sufficient time (45.1b)
- incompatible with a judgment issued in the country of enforcement (45.1c
& d)
- from a court having no jurisdiction (45.1e)
- see also art. 64: civil decision in criminal proceedings, defendant had no
opportunity to arrange defence

NY Convention on arbitration takes precedence over the Regulation
Recognition & enforcement


-
-
Automatic recognition and enforcement applies under
the Recast 1215/2012 also to:
Authentic instruments (as notarial deeds) (58.1)
Court settlements (58.2)
Extraterritorial effect of provisional measures:
by court having jurisdiction over substance: measure
enforceable in the EU (if unilateral procedure, then only
after service of decision to the defendant)
by court not having jurisdiction over substance:
jurisdiction for protective measures (supra), but effect
confined to territory of that MS
Insolvency proceedings

-
Types of insolvency proceedings usually found abroad:
Liquidation proceedings, such as bankruptcy
Reorganisation and composition proceedings, such as:
* judiciary reorganisation,
* collective agreement with creditors (suspension of the execution
by creditors in order to reorganise the business)
-
In all these proceedings the control over the assets of the debtor is
granted to an administrator and the claims of the creditors are dealt
with collectively (instead of individually)
-
Not an « insolvency proceeding »: English ‘Scheme of Arrangement’
under part 26 Companies Act
Insolvency proceedings

-
International insolvency: two conflicting solutions / principles:
universalism (single bankruptcy extended to all countries where
debtor has assets) (eg Belgian law, US law)
Moderate territorialism: insolvency proceedings in each country
relate only to assets in that country.
radical territorialism: insolvency proceedings in each country
relating to assets in that country that are « ring-fenced »: the
product is used first for debts incurred in that country

Universalism only works insofar as the proceedings are recognised
in other countries where assets lie.

EU-Regulation 1346/2000 on insolvency proceedings has chosen a
compromise solution
EU Insolvency regulation
EU-Regulation 1346/2000 (Recast proposed in 2013, agreed Dec. 2014)
Scope of application: only where debtor has its « centre of main interest »
(COMI) in a Member State; not limited to cases where at least 2 member
states are involved (C-328/12, Schmid / Hertel)
Presumption that the seat of a legal person is its COMI (art. 3 id. recast).
 Definition of insolvency proceedings to which it applies (art. 1.1:
collective proceedings,
based on insolvency,
which entail the partial or total divestment of a debtor,
and the appointment of a liquidator
(a list is found in the Annex A to the Regulation)
Thus not applicable where « debtor in possession ». Proposed Recast would
make it possible to include them (new Art. 1). There is also a March 12,
2014 Recommendation from the European Commission
 Exclusions: next slide

EU Insolvency regulation

EU-Regulation 1346/2000 (Recast proposed in 2013, agreed Dec. 2014)

Not covered by the Insolvency Regulation, but by separate Directives:
-
financial institutions (WUDB, Winding up Directive for Banks 2001/24) and
insurance companies (WUDI-Directive).

No uniform rules regarding investment companies yet

NB. Sovereign default:
No international framework yet for state insolvency
for local government, some countries apply private law, eg Detroit city
insolvency.
-
EU Insolvency regulation jurisdiction
EU-Regulation 1346/2000 - Basic solution – possible procedures
 Art. 3.1.: main proceedings: possible (only) in country of « centre of main
interest » of the debtor (« COMI »). In principle universal jurisdiction,
unless limited by a territorial procedure. Proposed recast would 1° define
COMI and 2° also cover jurisdiction over avoidance actions (art. 3a)
Result: forum shopping (insolvency tourism) by moving the COMI.


-
Art. 3.2.: a territorial insolvency can be opened in other MS where the
debtor has an establishment. When there is a main proceeding, the
territorial one is called « secondary »:
it is territorial with respect to assets,
but universal with respect to creditors (all creditors may file, not only for
debts incurred in that country – no ring-fencing).
It is in principle always a liquidation procedure, subject to duty to cooperate
in case main proceedings are not liquidating (C-116/11 Bank Handlowy)
A territorial procedure can be requested only by local creditors, a secondary
by any creditor (C-327/13 Burgo Group)
EU Insolvency regulation jurisdiction

EU-Regulation 1346/2000 - Basic solution – possible procedures
-
Proposed Recast would limit possibility of such secondary procedures a bit
more (see i.a. art. 36 recast)
Where no secondary procedure is opened: no enforcement proceedings
possible except those permitted by the law of the state of the main
proceedings (ECJ in C-444/07)
-

-
EU-Regulation 1346/2000, art. 3 Scope of jurisdiction –
jurisdiction includes actions derived directly from the insolvency
proceedings and closely connected with them, e.g. actions to se a
detrimental transaction aside (pauliana) (C-339/07, Seagon/Deko Marty)
even where the defendant resides outside the EU: C-328/12, Schmid /
Hertel.
EU Insolvency Regulation

EU-Regulation 1346/2000 – Effects abroad of procedures:
-
opening of proceedings can be published in other MS (art. 21-22, recast 2829)
main insolvency must be recognised in other MS (art. 16, recast 19); has in
principle the same effects as if it were opened in that state (art. 17, recast
20) – except where manifestly contrary to public order (art. 26) (e.g.
fundamental rights) or insofar as it is a matter for a secondary procedure
effectively opened
further rules on coordination
effect on pending lawsuits depends on lex fori of that lawsuit (art. 15)
Recast :
* internet register for insolvency proceedings (art. 25 ff recast)
* duty to cooperate incl. exploring possibility of restructuring (see art. 41 ff
recast).
* Ch. on insolvency of members of a group of companies (56 ff.)
-
-
-
EU Insolvency Regulation –
applicable law

-
-
The lex concursus (i.e. the lex fori of the place of opening of the
insolvency) determines according to Art. 4 (7 recast) i.a.:
the procedural aspects of the insolvency: which assets are in
principle administered; how they are administered (powers of the
administrator, the court, the debtor); formalities to be fulfilled by
creditors; how sale and distribution proceedings are organised;
distribution of the product in the absence of property rights
effect on later disposition of assets, other than assets subject to
registration
effect of insolvency on current contracts (art. 4.2.e)
Except: individual execution right of creditor with proprietary right
(lex rei sitae) (eg in many countries creditor with mortgage) – to be
decided by the lex rei sitae
EU Insolvency Regulation –
applicable law

-

-
As to existing property rights on assets which fall under the
insolvent estate:
it is in principle the lex rei sitae (place of the asset) which
determines the property rights on the asset (art. 5 (8 recast), for
reservation of title art. 7 (10 recast), incl. Enoforcement rights
surplus must go in the insolvent estate (lex concursus)
Recast art. 2 (9) will clarify the lex rei sitae in respect to certain
assets, such as
registered shares: located in the registered office of the company
book entry securities (‘dematerialised’): where the account is
maintained
account money (cash in accounts): member state indicated by the
IBAN
other rights to performance (claims): COMI of the debtor

EU Insolvency Regulation –
applicable
law
(Cont.)
Whether detrimental acts are voidable/defeasable*: lex concursus,
unless undefeasable according to lex causae (art. 4.2.m (recast
7.2.m) + art. 13 (recast 16)). Applies only to acts before the
opening of the proceedings, including the exercise after the opening
of rights derived from such acts (ECJ C-557/13, Lutz)
* in the US « preference action » (payee was unduly preferred)
• The corresponding art. 30 in the WUDB was interpreted extensively
in E-28/13 (EFTA Court), LBI v Merrill Lynch


Set-off: important differences between national laws on effect after
insolvency. Art. 6 (recast 9) Reg.: set-off is effective if either
effective under the lex concursus or under the lex causae of the
passive claim (claim of the insolvent debtor used by the creditor to
get paid).

Effect on labour contracts: governed by lex contractus (art. 10,
Recast 13)