International Commercial Litigation -...

International Commercial Litigation

This carefully structured, practice-orientated textbook provides everything the law student needs to know about international commercial litigation. The strong comparative component provides a thought-provoking international perspective, while at the same time allowing readers to gain unique insights into litigation in English courts. Three important themes of the book analyse how the international element may call into question the power of the court to hear the case, whether it should exercise this power, whether foreign law applies, and whether the court should take into account any foreign judgment. Hartley provides the reader with extracts from leading cases and relevant legislation, together with an extensive reference library of further reading for those who wish to explore the topic in more detail, making this a valuable, single-source textbook. International commercial litigation is an area where the law changes fast. To keep the book up to date, new material will be posted on the book’s website, www.cambridge.org/thartley/. This will cover both cases and legislation.

Trevor C. Hartley is Professor of Law Emeritus at the London School of Economics, where he specializes in private international law and European Community law.

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Cambridge University Press978-0-521-86807-5 - International Commercial Litigation: Text, Cases and Materials on Private International LawTrevor C. HartleyFrontmatterMore information

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International Commercial Litigation

Text, Cases and Materials on Private International Law

Trevor C. Hartley






cambridge university pressCambridge, New York, Melbourne, Madrid, Cape Town, Singapore, São Paulo, Delhi

Cambridge University PressThe Edinburgh Building, Cambridge CB2 8RU, UK

Published in the United States of America by Cambridge University Press, New York

www.cambridge.orgInformation on this title: www.cambridge.org/9780521687485

© Trevor C. Hartley 2009

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First published 2009

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ISBN 978-0-521-86807-5 hardbackISBN 978-0-521-68748-5 paperback

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Law is made for man, not man for the law.

I have taken this epigraph as the motto of my book. It is not clear where it comes from: a Google search suggests various possibilities, including Jesus and St Paul. No matter who said it fi rst, it expresses better than anything else the approach I take. The same idea was advanced, less pithily and more mundanely, by the Supreme Court of Canada in 2006, in Pro Swing v. Elta Golf, when Deschamps J said, ‘The law and the justice system are servants of society, not the reverse.’ That is what I believe too.






vii

Contents

Table of panels xxvList of fi gures xxixPreface xxxiAcknowledgments xxxiiiTerminology xxxvTable of Latin phrases xxxviList of abbreviations xxxviiTable of cases xxxviiiTable of cases (European Court of Justice, numerical order) lxiiiTable of legislative instruments lxvii

PART I STARTING OFF 1

1 Introduction 31 Private international law 32 Names and what they mean 33 What is it based on? 54 International uniformity of result: a grand objective? 5

PART II JURISDICTION 9

2 Jurisdiction: an analysis 111 What is jurisdiction? 112 Jurisdiction in personam 123 Jurisdiction in rem 124 Objectives 12

4.1 Confl icting judgments 134.2 Enforcement 134.3 Keeping the parties to their agreements 144.4 Wasting time and resources 144.5 Offending foreign States 144.6 Fairness to the defendant 144.7 Countervailing considerations 15

5 Principles of jurisdiction in personam 15






viii CONTENTS

6 Principles of jurisdiction in rem 16Further reading 17

3 Jurisdiction under EC law 181 Background 182 Origin of the Brussels I Regulation 193 The Lugano Convention 204 Basic principles 215 Defendants from third countries 226 Domicile 24

6.1 Area of domicile 246.2 Domicile of natural persons (individuals) 256.3 United Kingdom rules of domicile (individuals) 256.4 Domicile of legal persons (corporations) 276.5 The role of domicile 28

7 Jurisdiction irrespective of domicile 298 Which instrument applies? 299 Subject-matter scope 30

9.1 What law decides? 31LTU v. Eurocontrol 31

9.2 Applying the test 34Netherlands v. Rüffer 34Baten 36

Further reading 38General works on the Brussels Convention, the Brussels

Regulation and the Lugano Convention 39

4 EC law: special jurisdiction 401 Article 5 40

1.1 Contracts 401.1.1 When does a claim relate to contract? 41

Handte v. TMCS 411.1.2 The place of performance 45

Tessili v. Dunlop 451.1.3 The obligation in question 471.1.4 The revised version of Article 5(1) 48

Color Drack v. LEXX International 481.1.5 Contracts not covered by Article 5(1) 52

1.2 Tort 52Bier v. Mines de Potasse d’Alsace 53Marinari v. Lloyds Bank 55

1.3 Branches, agencies and other establishments 571.3.1 What constitutes a branch, agency or other establish-

ment? 571.3.2 What disputes are covered? 58






CONTENTS ix

Lloyd’s Register of Shipping v. Campenon Bernard 58Anton Durbeck v. Den Norske Bank 60

2 Multiple parties 62Reisch Montage v. Kiesel Baumaschinen 64

3 Counterclaims 654 Weak parties 66

4.1 Employment contracts 66Mulox v. Geels 68

5 Exclusive jurisdiction 705.1 Scope 70

Webb v. Webb 715.2 Non-member States 72

6 Procedure 737 Conclusions 76Further reading 76

5 The traditional English rules 771 Introduction 772 Service of the claim form 77

Colt Industries Inc. v. Sarlie 79Maharanee of Baroda v. Wildenstein 81

3 Service on a company 833.1 Introduction 833.2 Company’s own offi ce 84

Dunlop Pneumatic Tyre Co. Ltd v. A. G. Cudell & Co. 84

South India Shipping v. Bank of Korea 863.3 Acting through an agent 87

Adams v. Cape Industries 883.4 A short-lived anomaly 90

Saab v. Saudi American Bank 923.5 Subsidiaries 953.6 Conclusions 95

4 Service outside the jurisdiction 964.1 Introduction 964.2 Contracts 97

4.2.1 Contract made within the jurisdiction 974.2.2 Made by or through an agent trading or residing within

the jurisdiction 984.2.3 Governed by English law 994.2.4 Choice-of-court clause 994.2.5 Breach committed within the jurisdiction 994.2.6 Declaration that no contract exists 99

4.3 Tort 99






x CONTENTS

Metall und Rohstoff v. Donaldson Lufkin & Jenrette 100

4.4 Multiple parties 1014.5 Weak parties 101

5 Jurisdiction by consent 1026 Exclusive jurisdiction 1027 Conclusions 103Further reading 104

6 Developments in Canada 1051 Introduction 1052 Ontario 1063 Service out of the jurisdiction in tort cases 106

Muscutt v. Courcelles 107Gajraj v. DeBernardo 119Lemmex v. Sunfl ight Holidays Inc. 122

4 Tort cases in Quebec 125Spar Aerospace Ltd v. American Mobile Satellite

Corporation 1255 Uniform law 1296 Conclusions 130Further reading 131

7 US law: an outline 1321 The US legal system 132

1.1 Federal jurisdiction 1331.2 Applicable law 135

1.2.1 State courts 1351.2.2 Federal courts 135

2 International jurisdiction 1362.1 State courts 136

2.1.1 The ‘minimum contacts’ doctrine 136International Shoe Co. v. State of Washington 136

2.1.2 Specifi c jurisdiction 138World-Wide Volkswagen Corporation v. Woodson 139

2.1.3 General jurisdiction 142Helicopteros Nacionales de Colombia v. Hall (‘Helicol’

case) 1422.1.4 Transient jurisdiction 145

Burnham v. Superior Court of California 1452.2 Federal courts 150

United States of America v. Swiss American Bank 151

3 Venue 1554 The United States and Europe compared 156






CONTENTS xi

4.1 Cases where European jurisdiction is more exten-sive 156

4.2 Cases where American jurisdiction is more exten-sive 1584.2.1 Individuals 1584.2.2 Companies 159

4.3 Assessment5 Conclusions 161Further reading 162

8 Choice-of-court agreements 1631 Introduction 163

1.1 Court specifi ed 1631.2 Exclusive jurisdiction 1631.3 Asymmetric choice-of-court agreements 1641.4 Proceedings covered 164

2 The European Community 1642.1 Introduction 1642.2 Consent and form 166

2.2.1 Sub-paragraph (a) 167Berghoefer v. ASA 168

2.2.2 Sub-paragraph (b) 1692.2.3 Sub-paragraph (c) 169

Mainschiffahrts-Genossenschaft eG v. Les Gravières Rhénanes 169

2.2.4 Electronic communications 1722.2.5 Relationship with Article 5(1) 172

2.3 Choice-of-court agreement in the constitution of a com-pany 173

2.4 Validity 173Elefanten Schuh v. Jacqmain 174

2.5 Effect on third parties 1752.6 Insurance contracts, consumer contracts and employ-

ment contracts 1762.7 The Community and the outside world 176

2.7.1 Choice-of-court agreement in favour of the English courts 178

2.7.2 Choice-of-court agreement in favour of the courts of a non-member State 179

2.8 Arbitration agreements 1803 England 180

The Fehmarn 181The Eleftheria 182Carvalho v. Hull Blyth Ltd 185

4 The United States 189






xii CONTENTS

M/S Bremen v. Zapata Offshore Company 189Carnival Cruise Lines v. Shute 194Vimar Seguros v. M/V Sky Reefer 198

5 The Hague Choice-of-Court Convention 2016 Conclusions 204Further reading 204

9 Forum non conveniens and antisuit injunctions 2051 Introduction 2052 England 207

2.1 Forum non conveniens 207Spiliada Maritime Corporation v. Cansulex 212

2.2 Antisuit injunctions 222Société Nationale Industrielle Aérospatiale v. Lee Kui

Jak 2232.3 Conclusions 228

3 The United States 2293.1 Forum non conveniens 229

Piper Aircraft v. Reyno 2303.2 Antisuit injunctions 235

4 Conclusions 235Further reading 235

10 Overlapping jurisdiction in EC law 2371 Lis pendens 237

1.1 The same cause of action 238Gubisch Maschinenfabrik v. Palumbo 238

1.2 The same parties 2401.3 Related proceedings 2401.4 Conclusions 241

2 Forum non conveniens 241Owusu v. Jackson 243

3 Antisuit injunctions 250Turner v. Grovit 250

4 Choice-of-court agreements and the ‘Italian torpedo’ 254Gasser v. MISRAT 255

5 Arbitration: a ‘torpedo-free’ zone 259Marc Rich and Co. v. Società Italiana Impianti 259

6 Conclusions 263Appendix 263Further reading 264

11: Special topics – I 2651 Products liability 265

1.1 England 265






CONTENTS xiii

Distillers Co. v. Thompson 266Castree v. Squibb Ltd 269

1.2 Canada 270Moran v. Pyle National (Canada) Ltd 270

1.3 The United States 272Asahi Metal Industry v. Superior Court of

California 2721.4 Conclusions 276

2 Defamation 2772.1 Introduction 2772.2 EC law 278

Shevill v. Presse Alliance SA 2782.3 English law 282

King v. Lewis 282Further reading 287

12 Special topics – II 2881 Intellectual property 288

1.1 EC law 289Duijnstee v. Goderbauer 290Gesellschaft für Antriebstechnik mbH & Co. KG (GAT)

v. Lamellen und Kupplungsbau Beteiligungs KG (LuK) 291

Roche Nederland v. Primus and Goldenberg 2951.2 English law 300

Coin Controls v. Suzo International (UK) 3001.3 The Hague Convention on Choice of Court

Agreements 3022 Multinationals and the Third World 303

2.1 Introduction 3032.2 The United States 304

Dow Chemical Company v. Castro Alfaro 305Aguinda v. Texaco Inc. 306

2.3 England 310Lubbe v. Cape plc 311

2.4 Conclusions 316Further reading 316

Intellectual property 316Multinationals 316

PART III FOREIGN JUDGMENTS 317

13 Introduction to Part III 3191 Principles 319






xiv CONTENTS

2 Recognition and enforcement 3193 Theories 3194 Giving effect to a judgment 3205 Res judicata and estoppel 320Further reading 321

14 EC law 3221 Introduction 3222 Principles 3233 Jurisdiction 3244 Judgments outside the scope of the Regulation 3255 Public policy 325

Krombach v. Bamberski 3266 Confl icting judgments 332

6.1 Judgments from the State of recognition 3336.2 Judgments from another State 3336.3 Judgments outside the scope of the Regulation 333

Hoffmann v. Krieg 3337 Confl icts with an arbitration award 3368 Provisional measures 3379 Choice-of-court agreements 33710 Arbitration agreements 33711 Fraud 33812 Natural justice 33913 Conclusions 342Appendix: principal grounds on which recognition may be refused 342Further reading 343

15 English law: jurisdiction 3441 Theoretical basis for recognition and enforcement 3442 Legislation 3453 Jurisdiction 346

3.1 ‘Home-court’ jurisdiction 3473.1.1 Individuals 347

Adams v. Cape Industries 347Richman v. Ben-Tovim 349

3.1.2 Corporations 350Vogel v. Kohnstamm Ltd 351

3.2 ‘Cause-of-action’ jurisdiction 3533.3 Submission 3543.4 Exceptions 3553.5 Conclusions 356

Further reading 357






CONTENTS xv

16 English law: defences 3581 Fraud 358

Owens Bank v. Bracco 359Owens Bank Ltd v. Fulvio Bracco and Bracco Industria

Chimica SpA 3642 Public policy, natural justice and human rights 3673 Taxes, penalties and other rules of public law 369

Huntington v. Attrill 369United States of America v. Inkley 373

4 Confl icting judgments 3755 Res judicata and issue estoppel 375

The Sennar (No. 2) 3765.1 English law or EC law? 3805.2 Judgment for the claimant 381

Further reading 381

17 The Canadian confl icts (judgments) revolution 3821 Jurisdiction of the foreign court 382

Morguard Investments Ltd v. De Savoye 3822 Enforcement of non-money judgments 391

Pro Swing Inc. v. Elta Golf Inc. 3913 Conclusions 393Further reading 393

18 US law: some highlights 3941 Reciprocity 3942 Uniform legislation 394

Bank of Montreal v. Kough 396Appendix: foreign-judgment recognition legislation (UK and US) 399

Major heads of jurisdiction of the foreign court 399Other requirements and defences 399

Further reading 400

PART IV PROCEDURE 401

19 Freezing assets 4031 Introduction 4032 Procedure 404

Third Chandris Shipping Corporation v. Unimarine SA 404

3 Third parties 406Z Ltd v. A–Z 406

4 Jurisdiction 411






xvi CONTENTS

5 Worldwide orders 4125.1 Worldwide orders in aid of foreign proceedings 412

Crédit Suisse Fides Trust SA v. Cuoghi 413Motorola Credit Corporation v. Uzan (No. 2) 417

5.2 Worldwide orders and third parties 424Derby & Co. Ltd v. Weldon (Nos. 3 and 4) 424Bank of China v. NBM LLC 425

5.3 Conclusions 4276 Commonwealth countries 4287 The United States 428

Grupo Mexicano de Desarrollo SA v. Alliance Bond Fund Inc. 428

United States v. First National City Bank 4298 The European Union 431

8.1 Jurisdiction over the substance 432Denilauler v. Couchet Frères 432

8.2 No jurisdiction over the substance 434Van Uden v. Deco Line 434Mietz v. Intership Yachting Sneek 439

8.3 Enforcing a judgment from another Member State 442Banco Nacional de Comercio Exterior SNC v. Empresa

de Telecom unicaciones de Cuba SA 4428.4 When does the Regulation apply? 445

8.4.1 Subject-matter scope 4468.4.2 Judgment in another Member State 4468.4.3 No judgment in another Member State 4468.4.4 A court of another Member State is seised fi rst 4468.4.5 No other Member State court is seised 4478.4.6 Conclusions 447

Further reading 448

20 Obtaining evidence abroad: forum procedures 4491 Evidence from parties to the proceedings 449

1.1 England 449Lonrho Ltd v. Shell Petroleum Co. Ltd 450

1.2 United States 454Société Internationale v. Rogers 454

2 Evidence from third parties 4562.1 England 456

Bankers Trust Co. v. Shapira 457Mackinnon v. Donaldson, Lufkin & Jenrette Securities

Corporation 458Altertext Inc. v. Advanced Data Communications

Ltd 4642.2 The United States 467






CONTENTS xvii

In re Grand Jury Proceedings Bank of Nova Scotia 467

3 Foreign proceedings 472X AG v. A Bank (also known as X, Y and Z v. B) 472


21 Obtaining evidence abroad: international co-operation 4771 Introduction 4772 England 479

2.1 ‘Fishing expeditions’ 479In re Asbestos Insurance Coverage Cases 479

2.2 Civil or commercial matters 480In Re State of Norway’s Application 480

3 The United States 4884 England: initiative by a party 488

South Carolina Insurance Co. v. Assurantie Maatschappij ‘de Zeven Provincien’ NV 489

5 The Hague Convention: a blocking device? 493Société Nationale Industrielle Aérospatiale v. United

States District Court for the Southern District of Iowa 493


PART V CHOICE OF LAW 501

22: Introduction to choice of law 5031 Why apply foreign law? 5032 Traditional choice-of-law theory 504

2.1 The methodology of categorization 5042.2 Substance and procedure 5052.3 Some basic ideas 505

2.3.1 The personal law: individuals 5062.3.2 The personal law: companies 506

McDermott Inc. v. Lewis 5072.3.3 The lex situs 5112.3.4 The lex loci actus 511

2.4 Methodological problems and escape devices 5112.4.1 Characterization 5122.4.2 Renvoi 5132.4.3 Public policy 514

3 Choice-of-law rules in international instruments 5144 American theories 515






xviii CONTENTS

4.1 Interest analysis 5154.2 The primacy of forum law 5194.3 The ‘better-law’ theory 519

5 Proof of foreign law 520Anton Durbeck v. Den Norske Bank 522


23 Torts 5301 England: historical development 530

The Halley 530Phillips v. Eyre 531Machado v. Fontes 533

2 The Rome II Regulation: general rule 5352.1 The country in which the damage occurs 5352.2 Common habitual residence 536

2.2.1 Rules of the road 5362.2.2 Multi-party cases 5372.2.3 Meaning of ‘country’ 5372.2.4 Meaning of ‘habitual residence’ 538

2.3 Flexibility 5393 Pre-existing relationship 539

McLean v. Pettigrew 540M’Elroy v. M’Allister 540Babcock v. Jackson 542Neilson v. Overseas Projects Corporation of Victoria

Ltd 5444 Common origin 547

Dym v. Gordon 547Chaplin v. Boys 550

5 US law: interest analysis and the ‘better law’ theory 552Milkovich v. Saari 552Rong Yao Zhou v. Jennifer Mall Restaurant Inc. 554Bernhard v. Harrah’s Club 555

6 The Rome II Regulation: special rules 5586.1 Products liability 559

6.1.1 Structure 5596.1.2 Primary rule 5596.1.3 Second-ranking rule 5596.1.4 Third-ranking rule 5596.1.5 Fourth-ranking rule 5606.1.6 Product marketed 5606.1.7 No rule applicable 5606.1.8 Conclusions 562

6.2 Intellectual property 562






CONTENTS xix

7 Defamation 5638 Choice of law 563Appendix: subject-matter scope of the Regulation 564Further reading 565

24 Contracts: the principle of party autonomy 5661 Introduction 5662 The theory of the proper law 5663 The Rome Convention 5714 The Rome I Regulation 571

4.1 Subject-matter scope 5714.2 International scope 5724.3 Meaning of ‘country’ 5734.4 Express choice 573

4.4.1 Freedom of choice 5734.4.2 Non-state law 573

4.5 Implied choice 574Amin Rasheed Shipping Corporation v. Kuwait

Insurance Co. 574Oldendorff v. Libera Corporation 578

4.6 Applicable law in the absence of choice 5804.6.1 Structure and general principles 5804.6.2 Meaning of ‘habitual residence’ 5834.6.3 Linked contracts 584

Bank of Baroda v. Vysya Bank 5854.6.4 The escape clause 588

Defi nitely Maybe Ltd v. Lieberberg GmbH 589Kenburn Waste Management Ltd v. Bergmann 593

4.6.5 Exceptions 5944.6.6 Carriage of goods 594§ 4.6.7 Carriage of passengers 594

4.7 The problem of consent 5954.8 Capacity 5964.9 Other provisions 597

Further reading 598

25 Contracts: legal policy and choice of law 5991 Introduction 5992 Terminology 5993 The Rome I Regulation 600

3.1 Purely domestic contracts 6013.2 Consumer contracts 6023.3 Individual employment contracts 6033.4 Contracts concerning immovable property 6063.5 Overriding mandatory provisions 606






xx CONTENTS

3.5.1 Overriding mandatory provisions of the forum 607Ingmar GB Ltd v. Eaton Leonard Technologies

Inc. 6083.5.2 Overriding mandatory provisions of foreign law 611

4 Foreign illegality under English common law 6114.1 Initial illegality 611

4.1.1 Contracts to commit a crime 611Foster v. Driscoll 611Regazzoni v. K. C. Sethia (1944) Ltd 613

4.1.2 Foreign public policy 617Lemenda Trading Co. Ltd v. African Middle East

Petroleum Co. Ltd 6184.1.3 Wider forms of illegality 619

Euro-Diam Ltd v. Bathurst 6204.1.4 Arbitration 622

Soleimany v. Soleimany 6224.2 Supervening illegality 625

Ralli Brothers v. Compania Naviera Sota y Aznar 6254.3 Conclusions 627

5 Foreign illegality under US law 627Triad Financial Establishment v. Tumpane

Company 629Business Incentives Co. v. Sony Corporation of

America 631Further reading 632

26 Contracts: regulating business, protecting employees and helping consumers 6331 Legal principles 6332 Estate agents 634

Freehold Land Investments Ltd v. Queensland Estates Pty Ltd 634

Dorothy K. Winston & Co. v. Town Heights Development Inc. 636

3 Lawyers 638Newcomb v. Daniels, Saltz, Mongeluzzi & Barrett

Ltd 6384 Employees 642

4.1 Exemption clauses 642Sayers v. International Drilling Co. NV 643Brodin v. A/R Seljan 649

4.2 Agreements not to compete 651Nasco Inc. v. Gimbert 652Nordson Corporation v. Plasschaert 653Barnes Group Inc. v. C&C Products Inc. 656






CONTENTS xxi

5 Consumers 660English v. Donnelly 660

Further reading 663

27 Foreign currency 6641 Exchange controls 664

1.1 Exchange controls of the forum 664Boissevain v. Weil 665

1.2 Foreign exchange controls 6671.2.1 General principles 667

Kleinwort, Sons and Company v. Ungarische Baumwolle Industrie 667

1.2.2 The IMF Agreement 668Wilson, Smithett & Cope Ltd v. Terruzzi 669Sing Batra v. Ebrahim 672United City Merchants v. Royal Bank of

Canada 6731.3 Conclusions 675

2 Claims in foreign currency 6762.1 The ‘breach-date’ rule 676

Competex v. LaBow 676Indag SA v. Irridelco Corporation 678

2.2 Judgment in foreign currency 679Miliangos v. George Frank (Textiles) Ltd 679Owners of the Eleftherotria v. Owners of the Despina

R 684Services Europe Atlantique Sud v. Stockholms

Rederiaktiebolag Svea 684Attorney General of Ghana v. Texaco Overseas

Tankships Ltd 6902.3 Developments in New York 693

3 Currency-exchange loss 693Ozalid Group (Export) Ltd v. African Continental Bank

Ltd 693Further reading 694

28 Property: tangible movables 6961 Introduction 6962 Stolen property 697

Winkworth v. Christie Manson and Woods Ltd 6973 Tax claims 702

Brokaw v. Seatrain UK Ltd 7024 Nationalization: England and its colonies 704

Luther Co. v. Sagor & Co. 704






xxii CONTENTS

Anglo-Iranian Oil Co. Ltd v. Jaffrate (The Rose Mary) 706

Re Helbert Wagg & Co. Ltd 7095 Nationalization: United States 710

Banco Nacional de Cuba v. Sabbatino 710Nelson Bunker Hunt v. Coastal States Gas Producing

Company 7156 Conclusions 717

Oppenheimer v. Cattermole 717Further reading 719

29 Contractual rights and property interests – I 7201 Introduction 7202 Situs 7203 The distinction between contract and property 7214 Contractual debts and bonds 721

Re Helbert Wagg & Co. Ltd 721National Bank of Greece and Athens v. Metliss 727Adams v. National Bank of Greece 730

5 Bank accounts 734Libyan Arab Foreign Bank v. Bankers Trust Co. 734

6 Letters of credit 740Power Curber International Ltd v. National Bank of

Kuwait 7407 Voluntary assignments: the Rome I Regulation 743

7.1 The structure of Article 14 7437.2 The problem of characterization (classifi cation) 744

Raiffeisen Zentralbank Österreich v. Five Star Trading 745

7.3 When will each paragraph of Article 14 apply? 7527.4 What law should apply under paragraph 3? 7537.5 The lex situs 755

Further reading 755

30 Contractual rights and property interests – II 7561 Shares 756

1.1 The common law 756Braun v. Custodian 756Macmillan Inc. v. Bishopsgate Investment Trust plc

(No. 3) 759Williams & Humbert Ltd v. W&H Trade Marks (Jersey)

Ltd 7611.2 The Rome I Regulation 765

2 Third-party debt orders and garnishment 7652.1 English law 766






CONTENTS xxiii

Deutsche Schachtbau- und Tiefbohrgesellschaft mbH v. Ras Al-Khaimah National Oil Co 767

Société Eram Shipping Co. Ltd v. Compagnie Internationale de Navigation 772

2.2 EC law 7753 Conclusions 776Further reading 776

31 Contractual rights and property interests – III 7771 Original approach 777

Republic of Iraq v. First National City Bank 777United Bank Ltd v. Cosmic International Inc. 779Vishipco Line v. Chase Manhattan Bank 782

2 New approaches 783Tabacalera Severiano Jorge SA v. Standard

Cigar 784Allied Bank International v. Banco Credito Agricola de

Cartago 785Callejo v. Bancomer 788Braka v. Bancomer 791

3 Situs under US law 7914 The Hickenlooper Amendment 792

French v. Banco Nacional de Cuba 7925 Conclusions 797

5.1 England and the US compared 7975.2 Should English law be changed? 798

Further reading 799

PART VI EXTRATERRITORIALITY 801

32 Introduction to Extraterritoriality 8031 What Is Extraterritoriality? 8032 Jurisdiction to enforce 804

United States v. Alvarez-Machain 804Further reading 809

33 Extraterritorial application of US antitrust law 8101 Introduction 8102 Act of state and choice of law 810

American Banana Company v. United Fruit Company 811

3 About turn! 814United States v. Sisal Sales Corporation 814

4 The effects doctrine 816






xxiv CONTENTS

United States v. Aluminum Company of America 8165 A balancing exercise 818

Timberlane Lumber Co. v. Bank of America I 818Timberlane Lumber Co. v. Bank of America II 822

6 The new hard line 825Hartford Fire Insurance Co. v. California 825

Further reading 831

34 The international response 8321 Patents 832

British Nylon Spinners v. ICI 8322 Obtaining evidence 835

Westinghouse Electric Corporation Uranium Contract Litigation (Rio Tinto Zinc v. Westinghouse) 836

Westinghouse Electric Corporation v. Duquesne Light Co. 839

3 Meanwhile, back in the USA . . . 841In re Westinghouse Electric Corporation Uranium

Contracts Litigation 841In re Uranium Antitrust Litigation 843

4 The Protection of Trading Interests Act 1980 8454.1 General 8454.2 Overseas measures 8454.3 Obtaining evidence 8464.4 Criminal penalties 8464.5 Foreign judgments 8464.6 ‘Claw-back’ 8474.7 Conclusions 847

5 The Laker Airways case 8486 The Soviet gas pipeline 8497 The Helms–Burton Act 8508 Conclusions 851Further reading 851

35 Extraterritorial application of EC competition law 8531 Introduction 8532 Dyestuffs 854

ICI v. Commission 8543 Wood pulp 857

Ahlström v. Commission 8574 Conclusions 861

Bibliography 862

Index 864






xxv

Table of panels

3.1 Recognition and enforcement of judgments within the Community:EC Treaty, Article 293 (formerly Article 220) page 21

3.2 Defendants domiciled in third countries: Brussels I Regulation,Article 4 23

3.3 Conventions with third countries: Brussels I Regulation, Article 72 24 3.4 General jurisdiction: Brussels I Regulation, Article 2 24 3.5 Law applicable to determine the domicile of an individual: Brussels

I Regulation, Article 59 25 3.6 UK rules of domicile for individuals: Civil Jurisdiction and Judgments

Order 2001, Article 9 26 3.7 Domicile of companies: Brussels I Regulation, Article 60 27 3.8 Which instrument applies? Lugano Convention, Article 54B 30 3.9 Subject-matter scope: Brussels I Regulation, Article 1 30 4.1 Persons domiciled in another Member State: Brussels I Regulation,

Article 3 40 4.2 Matters relating to a contract: Brussels I Regulation, Article 5(1) 48 4.3 Matters relating to a tort: Brussels I Regulation, Article 5(3) 52 4.4 Branch, agency or other establishment: Brussels I Regulation,

Article 5(5) 57 4.5 Multiple parties: Brussels I Regulation, Article 6 63 4.6 Counterclaims: Brussels I Regulation, Article 6(3) 65 4.7 Individual contracts of employment: Brussels I Regulation, Articles

18–21 67 4.8 Exclusive jurisdiction: Brussels I Regulation, Article 22 71 4.9 Submission: Brussels I Regulation, Article 24 73 4.10 Examination as to jurisdiction: Article 22: Brussels I Regulation,

Article 25 74 4.11 Examination as to jurisdiction: service: Brussels I Regulation,

Article 26 74 4.12 Examination as to jurisdiction: service: Service Regulation,

Article 19 75 5.1 Branch in England: Companies Act 1985, sections 690A and 694A 91 5.2 Place of business other than a branch: Companies Act 1985,

sections 690B, 691 and 695 91 5.3 Service on a company under the Civil Procedure Rules, Rules 6.3

and 6.9 92






xxvi TABLE OF PANELS

5.4 Contracts: Civil Procedure Rules, Rule 6.36 and Practice Direction6 B 98

5.5 Tort: Practice Direction 6 B 99 5.6 Multiple parties: Practice Direction 6 B, paragraph 3.1(3) 101 5.7 Foreign land: Civil Jurisdiction and Judgments Act 1982, section 30 103 6.1 Rules of Civil Procedure (Ontario) (RPO 1990), Regulation 194 106 6.2 Jurisdiction of Quebec courts: Quebec Civil Code, Article 3148 126 6.3 Uniform Court Jurisdiction and Proceedings Transfer Act

(Uniform Law Conference of Canada), sections 3 and 10 130 7.1 Due Process Clause of the Fourteenth Amendment (US

Constitution) (1865) 137 7.2 Due Process Clause of the Fifth Amendment (US Constitution)

(1791) 150 7.3 Federal Rules of Civil Procedure, Rule 4(k)(2) (1993) 151 8.1 Choice-of-court agreements: Brussels I Regulation, Article 23 165 8.2 Protection of weak parties: Brussels I Regulation, Articles 8, 13,

15, 17, 18 and 21 177 8.3 New York Arbitration Convention 1958, Article II(3) 18010.1 Lis pendens: related actions: Brussels I Regulation, Articles 27–30 23712.1 Intellectual property: Brussels I Regulation, Article 22 28914.1 Recognition and enforcement: Brussels I Regulation, Articles 33

and 38 32314.2 Appeal in the court of origin: Brussels I Regulation, Article 37 32314.3 Conventions with third countries: Brussels I Regulation, Article 72 32414.4 Public policy: Brussels I Regulation, Articles 34 and 35 32514.5 Civil claim in criminal proceedings: Brussels I Regulation, Article 5 32614.6 The right to defend oneself: Brussels I Regulation, Article 61 32814.7 Confl icting judgments: Brussels I Regulation, Article 34 33214.8 Brussels Convention, Article 27(4) 33615.1 Submission: Civil Jurisdiction and Judgments Act 1982, section 33 35515.2 Choice-of-court and arbitration agreements: Civil Jurisdiction and

Judgments Act 1982, section 32 35615.3 State (sovereign) immunity: Civil Jurisdiction and Judgments Act

1982, section 31 35616.1 Foreign judgments as a bar to new proceedings: Civil Jurisdiction

and Judgments Act 1982, section 34 38118.1 Foreign-court jurisdiction: Uniform Foreign-Country Money

Judgments Recognition Act, section 5 39519.1 Power to grant injunctions: Supreme Court Act 1981, section 37 40319.2 Foreign judgments: Civil Jurisdiction and Judgments Act 1982,

section 25 41119.3 Provisional, including protective, measures: Brussels I Regulation,

Article 31 43119.4 Provisional measures in enforcement proceedings: Brussels I

Regulation, Article 47 442






TABLE OF PANELS xxvii

20.1 Disclosure and inspection of documents: Civil Procedure Rules,Rule 31.8 449

21.1 Assistance to foreign and international tribunals: 28 USC § 1782(a) 48823.1 Torts: the general rule: Rome II Regulation, Article 4 53623.2 Rules of safety and conduct: Rome II Regulation, Article 17 53623.3 States with more than one legal system: Rome II Regulation,

Article 25 53723.4 Habitual residence: Rome II Regulation, Article 23 53823.5 Environmental damage: Rome II Regulation, Article 7 55323.6 Products liability: Rome II Regulation, Article 5 55923.7 Infringement of intellectual property rights: Rome II Regulation,

Article 8 56223.8 Freedom of choice: Rome II Regulation, Article 14 56323.9 Subject-matter scope of the Rome II Regulation: Rome II

Regulation, Article 1 56424.1 Subject-matter scope of the Rome I Regulation: Rome I Regulation,

Article 1 57224.2 States with more than one legal system: Rome I Regulation,

Article 22 57324.3 Express and implied choice of law: Rome I Regulation, Article 3 57324.4 Applicable law in the absence of choice: Rome I Regulation,

Article 4 58324.5 Meaning of ‘habitual residence’: Rome I Regulation, Article 19 58424.6 Carriage of goods: Rome I Regulation, Preamble (Recital 22) and

Article 5(1) 59424.7 Carriage of passengers: Rome I Regulation, Article 5(2) 59524.8 Consent and material validity: Rome I Regulation, Article 10 59524.9 Incapacity: Rome I Regulation, Article 13 59624.10 Other provisions: Rome I Regulation, Articles 11 and 12 59725.1 Overriding mandatory provisions: Rome I Regulation,

Article 9(1) 60025.2 Non-derogable provisions: Rome I Regulation, Article 3 60125.3 Consumer contracts: Rome I Regulation, Article 6 60225.4 Consumer contracts: Rome I Regulation, Recitals 23–32 60425.5 Individual employment contracts: Rome I Regulation, Article 8 60525.6 Overriding mandatory provisions: Rome I Regulation, Article 9 60625.7 Overriding mandatory provisions of foreign law: Rome Convention,

Article 7 60725.8 Overriding mandatory provisions of the forum: Rome Convention,

Article 7 60725.9 Restatement of the Law Second: Confl ict of Laws, § 187(2) 62727.1 Computation of judgments and accounts: New York Judiciary Law,

§ 27 69328.1 Hickenlooper Amendment: Foreign Assistance Act 1964, 22 USC

§ 2370(e)(2) 715






xxviii TABLE OF PANELS

29.1 Voluntary assignment and contractual subrogation: Rome IRegulation, Article 14 743

29.2 Proposed amendment to Article 14 of the Rome I Regulation 75430.1 Material scope (company shares): Rome I Regulation, Article 1 76534.1 Obtaining evidence: Protection of Trading Interests Act 1980,

section 4 83934.2 Enforcing judgments: Protection of Trading Interests Act 1980,

section 5 84635.1 EC rules on competition: EC Treaty, Articles 81 and 82 853






xxix

Figures

2.1 Jurisdiction page 1322.1 Traditional choice-of-law methodology 504






xxxi

Preface

This is a book about international commercial transactions and the litigation that results from them. It focuses on litigation in national courts, not interna-tional ones. The international element may affect the proceedings in three main ways:

1. the international element may call into question the power of the court to hear the case (its jurisdiction) and raise the issue of whether it should exercise that power, even if it has it;

2. the court may have to consider the application of foreign law (choice of law); and

3. the court may have to take account of a foreign judgment.

These three issues form the main themes of the book, but we will also look at other aspects of international civil procedure – for example, international freez-ing injunctions and the procedures for obtaining evidence from abroad – as well as questions that verge on public international law, such as extraterritoriality.

The reference in the subtitle to ‘Private International Law’ links up with the more traditional subject that deals with these matters. However, this is not a traditional book. First, it is practice-oriented, not theory-oriented: extensive analysis of abstruse concepts will not be found. Secondly, it adopts a functional approach. Law should serve economic and social objectives: it is not an end in itself, based on supposedly self-justifying principles. This does not mean that logic has no place: it has a function, that of promoting certainty. But legal logic fulfi ls that function only to the extent that it makes the answer clear to the ordinary person, or at least the ordinary lawyer. Legal logic has no place if it goes beyond this. The convoluted reasoning of some cases in the past that has extended legal logic beyond the wildest imaginings of any reasonable lawyer has no place in a modern system of private international law.

A third characteristic of the book is that it gives jurisdiction and other aspects of international civil procedure more attention than choice of law, the main topic of more traditional books. This is because they are more important. The book also focuses on commercial litigation. Although there is discussion of personal-injury litigation and other topics in which the relevant legal principles are the same as those applied to commercial cases, there is no discussion of family law or succession.

The book includes a comparative element. Although focused primarily on English law, and the law of Commonwealth countries like Canada and Australia






xxxii PREFACE

that follow the English tradition, it pays attention to the wider world. The United Kingdom is part of the European Community, and a signifi cant part of the subject-matter of the book has been taken over by the EC. Here, Community law is UK law. It is the law of the land and we have to know it. In addition, the book contains material on US law. The United States is so important today, especially in international business, that any book on international transactions and litigation has to take account of its law. A lawyer who lacks at least a basic grasp of some of its concepts and procedures cannot be regarded as qualifi ed to practise in the area.

One fi nal point: this is an area of law that changes rapidly. If the book simply presented a snapshot of the law as it existed at a given moment, it would be of only limited use. Within fi ve years things would have changed. Of course, it is not possible to predict what will happen in the future. However, if we study the past, we can understand the forces that shape the present. These forces will continue to operate in the future. So, if we look at the past development of the law, we can get some idea of how it may change. Solutions that were rejected in the past are unlikely to prove any more successful in the future. For this reason, cases that have been superseded are sometimes set out in the text. They may no longer be good law, but they are still worth knowing about.

International commercial litigation is an area where the law changes fast. To keep the book up to date, new material will be posted on the book’s website, www.cambridge.org/thartley. This will cover both cases and legislation.






xxxiii

Acknowledgments

I would like to thank the following for kindly granting me permission to repro-duce extracts from cases for which they hold the copyright:

● the High Court of Australia;● the Incorporated Council of Law Reporting for England and Wales;● Lloyd’s Reports; and● the Scottish Council of Law Reporting.

I am grateful for their generosity. I am also grateful that cases from certain other jurisdictions may be reproduced free of charge without the need to obtain permission. Books of this kind are possible only if authors are able to reproduce extracts from judicial decisions without having to make excessive payments.

The discussion in Chapter 10 of Owusu v. Jackson, Turner v. Grovit and Gasser v. MISRAT is based on my analysis of these cases in the International and Comparative Law Quarterly for October 2005;1 and some of the material on the Rome II Regulation in Chapter 23 has been used as the basis for an article entitled ‘Choice of Law for Non-Contractual Liability: Selected Problems under the “Rome II” Regulation’, published in (2008) 57 International and Comparative Law Quarterly 899. In both cases, I am grateful for being able to reuse the material here.

In 2006, I gave the General Course on Private International Law at the Hague Academy of International Law, under the title ‘The Modern Approach to Private International Law: International Litigation and Transactions from a Common-Law Perspective’.2 Much material from those lectures has been incorporated into this book. In addition, the discussion of some cases in Part V of this book is based on a previous set of lectures given at the Hague Academy on ‘Mandatory Rules in International Contracts: The Common Law Approach’.3 In both cases, I am grateful that I can reuse the material here.

The discussion of the Brussels Convention/Regulation in various chapters draws on work fi rst published in ‘Introduction to the Brussels Jurisdiction and Judgments Convention’ (1994) V-1 Collected Courses of the Academy of European Law 223. I am grateful that I can reuse this material here.

I would like to thank Mr Peter Ringsted, attorney in Odense, Denmark, for telling me about the Danish case of F ApS v. J (UK) Ltd.

1 ‘The European Union and the Systematic Dismantling of the Common Law of Confl ict of Laws’ (2005) 54 ICLQ 813.

2 Recueil des Cours, Volume 319 (2006).3 Recueil des Cours, Volume 266 (1997).






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