59 th UIA CONGRESS Valencia / Spain October 28 November 1, 2015 PRIVATE INTERNATIONAL LAW Saturday, October 31, 2015 FORUM SELECTION CLAUSES IN INTERNATIONAL CONTRACTS VALIDITY REQUIREMENTS OF JURISDICTION CLAUSES IN BILLS OF LADING Alberto Pasino (Zunarelli Studio Legale Associato) Via San Nicolò 19, Trieste, Italy Tel. +39(0)407600281 Fax +39(0)407600282 alberto.pasino@studiozunarelli.com UIA 2015 1
1. Introduction The validity requirements of jurisdiction clauses in bills of lading has long been debated, both in single jurisdictions and within the ECJ. This has suggested us to include in the case study a dispute in Marseille among the US sea carrier, the shipper and the consignee, which would most likely entail a discussion over that issue. The clause under discussion could reasonably read as follows: All disputes relating to this Bill of Lading shall be determined by the Courts of Marseille to the exclusion of the jurisdiction of the courts of any other country provided always that the Carrier may in its absolute and sole discretion invoke or voluntarily submit to the jurisdiction of the Courts of any other country which, but for the terms of this Bill of Lading, could properly assume jurisdiction to hear and determine such disputes, but shall not constitute a waiver of the terms of this provision in any other instance. iii) Notwithstanding Clause 28 i) and ii), if Carriage includes Carriage to, from or through a port in the United States of America, the Merchant may refer any claim or dispute to the United States District Court for the Southern District of New York in accordance with the laws of the United States of America. Given the frequency of asymmetric, non-exclusive jurisdiction clauses in bills of lading, I am under the impression that the Recast one of the main goals of which was to ban the Italian torpedoes is far from thwarting the risk of an ongoing submarine warfare. Indeed, the revised rules concerning lis pendens can be applied to the extent that the jurisdiction clauses are of an exclusive nature: the sea carriers who will continue to incorporate hybrid or asymmetric jurisdiction clauses in their bills of lading will continue to be exposed to Italian torpedoes. Coming to the case study, given the change in the subjective scope of application of art. 25, the Court of Marseille will apply the Recast. I would like to point out that the 2005 Hague Convention on Choice of Court Agreements does not apply to contracts for the carriage of goods by sea. 2. The ECJ Case Law on jurisdiction clauses in bills of lading In order to speak about the ECJ Case Law on the specific issue, it is necessary to consider that the bill of lading is not the contract of carriage, but rather a printed standard form issued by the carrier. The bill is frequently issued after the vessel has sailed, and is signed neither by the shipper, nor by the consignee, but only by the carrier. This is why the assessment of the validity of such clauses has been carried out up to now in light of letter c of art. 23. According to the Schlosser report, the inclusion of letter c) in the validity requirements amounted to a relaxation of the formal provisions of such rule. Why speak about relaxation, if the rule imposes to ascertain the existence of the consensus? This is made clear by the ECJ Case Law concerning jurisdiction clauses in BLs. 2
The principles which emerge from the Estasis Salotti, Castelletti, Tilly Russ, Coreck decisions are: a) the ascertainment of the existence of the parties consent coincides with the ascertainment of the existence of the formal requirements set forth by art. 23 (Estasis Salotti; see Schlosser Report 1, 179) b) the parties' consent to the jurisdiction clause in a BL is presumed to exist where their conduct is consistent with a usage which governs the area of international trade or commerce in which they operate and of which they are, or ought to have been, aware (C 159/97, Trasporti Castelletti Spedizioni Internazionali S.p.A. c. Hugo Trumpy S.p.A.); c) form which accords must be assessed solely in the light of the commercial usages, without taking into account any particular requirements which national provisions might lay down (C 159/97, Trasporti Castelletti cit.); d) a jurisdiction clause is enforceable as against a third party holder, if the clause is valid and if by virtue of the applicable national law (to be identified pursuant to the rules of pil of the national court), the third party holder, in acquiring the bill, accedes to the shipper s rights and obligations (C. 71/83 Tilly Russ v. Haven & Vervoerbedrijf Nova; C 387/98 Coreck v. Handelsveem BV) 2. It should also be noted that some of the scholars who have analysed the issue from a maritime law perspective, have maintained that paragraph c) of Article 23(1) was added when the UK acceded to the EC Jurisdiction Convention to safeguard the Jurisdiction of the High Court of London, which is chosen in many international standard form contracts, including bills of lading 3. The usage envisaged by this case law, which must be ascertained by the national Judge, consists in the unilateral insertion of the jurisdiction clause in b/ls by the carrier, and it is binding to the extent that the bill of lading comes within the framework of a continuing business relationship between the shipper and the carrier, and the Court seized can establish that that relationship is governed as a whole by general conditions containing the jurisdiction clause drawn up by the carrier, and provided that the bills of lading are all issued on preprinted forms systematically containing such a jurisdiction clause. 1 Report on the Convention on the Association of the Kingdom of Denmark, Ireland and the United Kingdom of Great Britain and Northern Ireland to the Convention on jurisdiction and the enforcement of judgments in civil and commercial matters and to the Protocol on its interpretation by the Court of Justice (Signed at Luxembourg, 9 October 1978) by Professor Dr Peter SCHLOSSER, http://aei.pitt.edu/1467/ 2 M. Davies, Jurisdiction and Forum Selection in International Maritime Law: Essays in Honor of Robert Force, Kluwer Law International ed, 2005, p. 245 3 Y. Baatz, Maritime Law, Sweet & Maxwell ed., 2011, p. 14 3
3. The French Case Law on jurisdiction clauses in bills of lading If we imagine that the clause examined at the beginning were to undergo the scrutiny of a French Judge, what would we have to expect? There are two issues. With concern to the validity of the clause, while in the past French Judges were rather restrictive in assigning validity to jurisdiction clauses in bills of lading 4, in these last years, by applying the Castelletti doctrine, they have stated that the inclusion in a bill of lading of a clause attributing jurisdiction corresponds to a widely known and regularly observed usage in the international transport of goods by sea 5, adding that the issuing of the bill of lading after the loading of the container onto the ship does not have any impact on the contractual agreement, and that the fact that the bill of lading is not signed does not nullify the validity of the jurisdiction agreement. As for the requirements which have to be present in order for said clause to be enforced against third parties holding the bill of lading, the First Civil Section and the Commercial Chamber of the Cour de Cassation have long been in contrast. The First Civil Section has indeed always stated that the third party holder of the bill of lading is automatically and directly bound by the forum election clause inserted in the bill of lading 6, while the Commercial Chamber of the Cour de Cassation objected, on the one hand, that in order to apply a jurisdiction clause against the third party, the party s consent, evidenced by an express acceptance, is required and, on the other hand, that the mere delivery of the bill of lading or even the cargo to the consignee or a further third party holder, neither amounted to assuming all the rights and obligations of the shipper, nor to consenting to the jurisdiction provisions inserted into the bill of lading. Following the Scholars strong criticisms, the Commercial Chamber s stance changed completely and a consensus was reached between the Commercial Chamber and the First Civil Chamber: by means of a decision issued in 2009 the Commercial Chamber stated that a jurisdiction clause agreed between a carrier and a shipper inserted into a bill of lading shall have effect with respect to the third party holder of the bill of lading provided that, in acquiring the bill, he had succeeded to the rights and obligations of the shipper under the relevant national law 7. Such law has been identified through article 3 of the 1980 Rome Convention (in the specific case German law, which sets forth that all the clauses of the bill of lading are enforceable against the consignee) 4 Cour d Appel d Aix, 20.3.1979, DMF 79, 725; Cour d Appel de Rouen, 8.2.1974, DMF 74, 518; Cass. 8.11.1927 S1928.1.64; Cour d Appel d Aix, 4.2.1982, DMF 83, 531 5 Cass. com., 23.9.2014 SDV c. AMLIN France, MAERSK et alii, http://www.legifrance.gouv.fr/affichjurijudi.do?oldaction=rechjurijudi&idtexte=juritext000029515658&f astreqid=1750813966&fastpos=1. In similar terms see Cass. com. 16.12.2009, Navire Delmas Mascareignes, Bull. Civ. IV n. 215 6 Cass. 1ere civ. 25.11.1986, Siaci, Bull. Civ. 1986 I n. 227, p. 265; Cass. 1ere civ. 21.7.2001, Navire Bonastar II, Bull. Civ. 2001 I n. 224 p. 140, Court of Appeal (2 nd Ch.) 10.9.2009 Navire NYK Phoenixn No 08/02137 7 Cass. com. 16.12.2009, Navire Delmas Mascareignes op. cit. 4
Therefore, in brief, the French Judges seem to adhere to the principles expressed by the mentioned rulings of the ECJ, and before the Recast it would have hence been reasonable to expect a statement of validity of the clause. This conclusion should now no longer be taken for granted. 4. The Recast: some critical issues. There is one textual innovation in the Recast which is significant with regard to the case under discussion. Pursuant to art. 25 first paragraph, the question of whether a jurisdiction agreement is null and void as to its substantive validity shall be determined under the law of the member state identified in the jurisdiction agreement. Some Scholars have maintained that the amendment amounts to an acknowledgement of the material validity of the agreement as being something separate from the form. In other words, one could now reasonably argue that the consent of the parties is no longer solely determined by making reference to the formal requirements set forth in letters a, b and c of art. 25, but also by making reference pursuant to the Recast to the applicable law provisions governing its material validity. In my view the innovation is only partial: indeed before the Recast the notion of consent, as interpreted by the ECJ, had an autonomous meaning which included only the prima facie evidence of the consensus. Therefore, it was previously already possible to challenge such evidence, by disputing the existence of the agreement; which law had to be applied was the only open issue. The statement that such Law is the Law of the forum prorogatum is a welcome clarification. However, introducing a conflict of laws element into the substantive validity of a jurisdiction agreement could have the downside of increasing the number of disputes concerning its validity. I believe that even though the introduction of such statement increases the safeguard of the weak parties of the contract of carriage, it could negatively affect the process of consolidation of the European Judicial Space. I am under the impression that, in the transport sector, the need to safeguard the weak party could from now on result in an increase of the disputes concerning the following elements: 1. existence of the consensus: As the Heidelberg Report 8 states, the printing of a jurisdiction provision on the reverse side of the bill of lading does not comply with the formal requirement of [ ] Article 23 JR ( 279), but it should be considered binding for the shipper according to a trade usage. The Recast will very likely lead the courts to scrutinize more incisively the existence of the agreement, without settling for a mere presumption based on formal elements. 2. substantial validity requirements set forth by national statutes. If the jurisdiction clause designates a foreign court which is likely to apply its own law, the shipper might find his rights severely jeopardized by the court applying a particular limitation of liability regime or 8 Report on the Application of the Brussels Regulation in the Member States presented by Burkhard Hess, Thomas Pfeiffer and Peter Schlosser, http://ec.europa.eu/civiljustice/news/docs/study_application_brussels_1_en.pdf 5
giving effect to certain clauses in the bill that would not be valid in the country of the Court seized 9. In those cases the Recast could lead the non chosen Court to disregard the jurisdiction clause, based on domestic law principles such as the reasonableness of the clause and its capability to sufficiently safeguard the cargo interests (UK) or ordre publique (France); 3. existence of the usage: several Scholars have expressed perplexities on the existence of a generalized usage of maritime trade according to which the unilateral incorporation of jurisdiction clauses in bills of lading is considered binding by the shipper. Delebeque 10, for instance, remarks that each company has its own bill of lading which differs as to the jurisdiction clause: as the usage must be determined not in relation to the fact that bills of lading contain jurisdiction clauses, but in relation to the fact that such bill of lading confers jurisdiction to such forum, it would be difficult to identify the specific clause of which the parties ought to have been aware. The Recast may be reasonably expected to provide new arguments to those who have expressed those perplexities. 4. enforceability of the agreement against third parties: according to the European Parliament (Recital O, Res. 7.9.2010 on the implementation and review of Council Regulation (EC) No 44/2001) the fact that third parties may be bound by a choice-of-court agreement (for instance in a bill of lading) to which they have not specifically assented [ ] may adversely affect their access to justice and be manifestly unfair. The Recast could favour the resurfacing of the tendency not to extend the effects of the jurisdiction clause in the bill of lading to the consignee, by virtue of the mere delivery of the bill of lading or of the cargo to the consignee. In brief, I believe that the Recast will provide numerous arguments to challenge the validity of jurisdiction clauses. Analogously, with concern to the case study under discussion, I deem that the adhesion of the Marseille Court to the stance of the French Supreme Court and of the ECJ, should not be taken for granted. 9 M. Davies, Jurisdiction and Forum Selection, op. cit, p. 242. 10 Delebeque, Clauses attributives de compétence, transport maritime et textes communautaires: une unification de la jurisprudence par le base, DMF 2009, p. 700 6