Brussels I Regulation: Tort Cases

Question 1

What does Article 7(2) states in the Brussels I Regulation?

Answer 1

A person domiciled in a Member State may be sued in another Member State; in matters relating to tort, delict or quasi-delict, in the courts for the place where the harmful event occurred or may occur.

Question 2

What kind of jurisdiction does Article 7(2) fall under?

Answer 2

Special jurisdiction - providing the plaintiff with an extra option to sue the defendant in another Member State than that of his domicile. Derogates from principle that jurisdiction is vested in the courts of the State the defendant is domiciled.

Question 3

Why might the meaning of the phrase ‘matters relating to tort’ be broader than under English law?

Answer 3

Because the phrase has an independent EU meaning, although it includes most torts that would be considered under English law, e.g. negligence, nuisance and defamation.

Question 4

Why might a claimant prefer the rules under Article 7(2)?

Answer 4

The tort provision of the Regulation is used very often by claimants to sue in their own court.

Question 5

What case granted ‘matters relating to tort/delict’ independent meaning?

Answer 5

Kalfelis v Bankhaus Schroder

Question 6

Why did the CJEU grant independent meaning to the phrase ‘matters relating to tort/delict’?

Answer 6

It should be regarded as an autonomous concept to ensure equality and uniformity of obligations, so that the concept should not be interpreted simply as referring to national law.

Question 7

What was the case that provided meaning to the phrase ‘the place…where the harmful event occurred’?

Answer 7

Bier v Mines de Potasse

Question 8

What were the facts of Bier v Mines de Potasse?

Answer 8

The plaintiff ran a horticultural business in the Netherlands, whose irrigation depends mainly on the Rhine waters. The excessive salinisation of the Rhine caused damaged to its plantation. The plaintiff alleged that this was principally due to massive salty discharges from operations carried out by the defendant In France.

Question 9

Why might there be a need to grant special jurisdiction in cases of tort?

Answer 9

Because in certain situations, there may be a particularly close connecting factor between a dispute and a court other than that of the defendant’s domicile, making for more efficacious proceedings.

Question 10

What concern influenced the court in Bier to interpret the phrase ‘the place…where the harmful event occurred’?

Answer 10

Because both the place of the event giving rise to damage, and the place where the damage occurred, are both close connecting factors, and it would not be appropriate to opt for one over another when determining liability.

Question 11

What meaning to the expression ‘place where the harmful event occurred’ was given by the Court in Bier?

Answer 11

It acknowledged that the plaintiff has the option to commence proceedings either at the place where the damage occurred or the place of the event giving rise to it.

Question 12

What was the practical consequence of Bier?

Answer 12

The defendant may be sued either in the courts of the place where the damaged occurred or in the courts of the place of the event which gives rise to the damage.

Question 13

What were the facts in Dumez v Hessische Landesbank?

Answer 13

German banks (including Hessische Landesbank) cancelled loans to a German prime contractor, which caused the suspension of a property-development project, which caused the German subsidiaries of Dumez to go insolvent. Dumez claimed compensation for damage owing to this.

Question 14

Why was the damaged suffered by Dumez different from that in Bier?

Answer 14

In Bier, the damaged occurred as a direct effect of the causal agent. Whereas in Dumez, the direct consequences of the cancellation of the loan were suffered by the subsidiaries of Dumez, and the harm Dumez allegedly suffered was merely the indirect consequence of those financial losses.

Question 15

How did the Court in Dumez refine the broad rule laid down in Bier?

Answer 15

The expression ‘the place where the damage occurred’ can be understood only as indicating the place where the event giving rise to the damage…directly produced its harmful effects upon the person who is the immediate victim of that event.

Question 16

What reasoning did the Court deploy in its decision in Dumez?

Answer 16

They wanted to ‘avoid the multiplication of courts of competent jurisdiction’ that would otherwise have a detrimental impact on efficacious conduct of proceedings.

Question 17

What were the facts in Marinari v Lloyds Bank?

Answer 17

Mr Marinari was domiciled in Italy, and Lloyds Bank’s registered office was in London. The branch of Lloyds Bank refused to accept M’s promissory notes, believing them to be of dubious origin, and contacted the police, who subsequently arrested M. M then sued Lloyds in Italy, seeking compensation for damage caused by the conduct of the staff.

Question 18

What was the decision of the Court in Marinari v Lloyds Bank?

Answer 18

The term ‘the place where the harmful event occurred’…“cannot be construed so extensively as to encompass any place where the adverse consequences can be felt of an event which has already caused damage actually arising elsewhere.”

The term won’t be construed as including the place where the victim claims to have suffered financial damage upon initial damage arising and suffered by him in another Contracting State.

If actual damage has already been experienced in one place, one should not go on to ask where else the financial consequences of that damage were to be found.

Question 19

What were the facts in Kronhofer v Maier?

Answer 19

The German-domiciled defendants were directors of a German company. They persuaded K, by telephone, to enter into a call option contract. K was domiciled in Austria, who alleged the defendant’s had failed to warn him of the risks involved in the transaction (which occurred in Germany). K suffered the loss of part of the sum transferred. He sued for damages for damages in Austria.

Question 20

What was the issue in Kronhofer?

Answer 20

That the financial damage allegedly suffered by the claimant in another Contracting State is said to have affected the whole of his assets simultaneously (an issue of pure financial loss). The claimant had claimed that Austria was the place where the harmful event occurred because it was there that his assets were concentrated.

Question 21

What was the decision in Kronhofer?

Answer 21

The domicile of the claimant does not always coincide with the place where the damage occurred by reason only of the fact that some indirect damage has been suffered there.

Question 22

What were the facts in Domicrest Ltd v Swiss Bank Corporation, and which courts heard it?

Answer 22

English decision (a reference to the CJEU was not deemed necessary).

English plaintiff supplied and exported electronic consumer goods. Defendant was Swiss banker to a group of companies that plaintiff supplied goods to. When they first began supplying goods, they received a copy payment order authorising the bank to pay the invoice. Plaintiff said that representations were made saying the payment order constituted assurance of payment, and that based on those representations the plaintiff released its goods on order. Bank later refused three copy payment orders. Plaintiff sued for negligent misstatement.

Question 23

What was the decision in Domicrest?

Answer 23

The place where the harmful event giving rise to the damage occurs in a case of negligent misstatement is where the misstatement originates. It is there that the negligence is likely to take place. It remains true as it seems to me that it is the representor’s negligent speech rather than the hearer’s receipt of it which best identifies the harmful event.

With regard to where the damage itself occurs, it is right to submit that the damage occurred in Switzerland and Italy, where the goods were released without prior payment.

Question 24

What happened in Marzillier v AMT Futures Ltd?

Answer 24

AMTF was an execution only broker incorporated in the UK. MMGR is a firm of German lawyers. AMTF alleged that MMRG induced its former clients to issue proceedings in Germany and to advance causes of action under German law, in breach of exclusive jurisdiction and choice of law clauses in agreements made between AMTF and its former clients. It brought a claim in tort for inducement of breach of contract.

Question 25

What does the case of Marinari v Lloyds Bank illustrate about the Court’s reasoning?

Answer 25

Illustrates the focus by the court on the place of initial damage rather than damage consequential on that initial damage.

Question 26

What happened in Reunion Europeene?

Answer 26

A consignment of peaches was carried by sea from Australia to Rotterdam, and then by road to a town in France. On arrival the peaches were found to be overripe because of the breakdown of the cooling system. Proceedings were brought in France.

Question 27

What was the decision in Reunion Europeene?

Answer 27

Court held that the place where the harmful event occurred, for the purpose of a tortious claim against the actual carrier was to be regarded as the place where the actual carrier was to deliver the goods i.e. Rotterdam.

Question 28

How did the Court justify its decision in Reunion Europeene?

Answer 28

Met the requirements of foreseeability and certainty and displays a particularly close connecting factor with the dispute in the main proceedings.

Question 29

Why might it be that the Court has interpreted tort cases in the manner it has done?

Answer 29

Because it has set itself against an interpretation which would mean that a claimant would, in practice, always be able to sue in the courts of its own domicile.

Question 30

What was the conclusion reached in AMT Futures?

Answer 30

In the present case the failure to start proceedings in England against AMTF did not of itself cause AMTF any loss at all. What did cause the loss was the proceedings which were started in Germany.

Not a matter of what the relevant obligation is (with regard to jurisdiction and choice of law clause), but rather the key question is where in reality AMTF suffered the damage. The answer is that of Germany.

The damage which AMTF has suffered (in Germany) is the cost and expense caused by the litigation.

Question 31

What are the main points made by Lehmann (2011) regarding economic loss?

Answer 31

• Economic loss creates problems because it is notoriously hard to locate.

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