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Abstract
In fixing the place and provider for the resolution of disputes in advance, choice of court agreements increase procedural legal certainty and the predictability of litigation risks. Hence, their protection is crucial. This article undertakes a functional comparison of the remedies for breach of exclusive choice of court agreements in English and German courts, painting a picture of different approaches to a common problem. English courts, now no longer constrained by EU law, employ an entire arsenal of remedies, most strikingly the anti-suit injunction and damages effectively reversing a foreign judgment. In contrast, German courts exercise greater judicial restraint, even though damages for the breach of a choice of court agreement have recently been awarded for the first time. Against this backdrop, two distinct but interrelated reasons for the diverging approaches are identified and analysed, the different conceptions of choice of court agreements and the different roles of comity and mutual trust.
Acknowledgements
I would like to thank Dr Johannes Ungerer for his advice and the two anonymous reviewers for their constructive comments. Moreover, I would like to acknowledge the support provided by the Open Access Publication Fund of Humboldt-Universität zu Berlin.
Disclosure statement
No potential conflict of interest was reported by the author(s).
Notes
1 Trevor Hartley, International Commercial Litigation (Cambridge University Press, 3rd edn, 2020), 198.
2 Fiona Trust & Holding Corp v Privalov [2007] UKHL 40; [2007] Bus LR 1719, [26] (Lord Hope).
3 Ibid.
4 For reasons of brevity, the author kindly asks that all references to England, including those to English courts and law, be read to include Wales.
5 The two principal EU Regulations on choice of law, Regulation (EC) No 593/2008 of 17 June 2008 on the law applicable to contractual obligations (Rome I) OJ L 177/6 (hereafter: Rome I Regulation) and Regulation (EC) No 864/2007 of 11 July 2007 on the law applicable to non-contractual obligations (Rome II) OJ L 199/40, have been retained, see The Law Applicable to Contractual Obligations and Non-Contractual Obligations (Amendment etc) (EU Exit) Regulations SI 2019/834, as amended by SI 2020/1574, reg 10–11.
6 Principally consisting of Regulation (EU) No 1215/2012 of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (recast) OJ L351/1 (hereafter: Recast Brussels I Regulation) and Convention of 30 October 2007 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters OJ L339/3 (hereafter: Lugano Convention).
7 The Civil Jurisdiction and Judgments (Amendment) (EU Exit) Regulations 2019 SI 2019/479, reg 82–91. For a full account of the consequences, see Andrew Dickinson, “Realignment of the Planets – Brexit and European Private International Law” (2021) Praxis des Internationalen Privat- und Verfahrensrechts 213.
8 Bundesgerichtshof, Judgment of 17 October 2019 – III ZR 42/19; BGHZ 223, 269 (all quoted passages from this judgment have been translated by the author).
9 For example: Civil Jurisdiction and Judgments Act 1982, s 30; German Code of Civil Procedure, s 24; Recast Brussels I Regulation, Art 24; Civil Jurisdiction and Judgments Act 1982, ss 15A–E; Recast Brussels I Regulation, Arts 10–23.
10 Hague Convention, Arts 1, 5, 6, 8.
11 Supra, n 6.
12 Status Table of the Contracting Parties to the Hague Convention, https://bit.ly/3PBKPxF (accessed on 19 June 2023).
13 European Union (Withdrawal Agreement) Act 2020, s 39(1).
14 Civil Jurisdiction and Judgments Act 1982, s 3D(1).
15 Case 26/62 Van Gend en Loos v Nederlandse Administratie der Belastingen [1963] ECR English Special Edition 1; Case 6/64 Flaminio Costa v E.N.E.L. [1964] ECR English Special Edition 585.
16 Though the EU Member State Denmark has also acceded to the Hague Convention in its own right, the Recast Brussels I Regulation – which applies between it and the other EU Member States based on the Agreement between the European Community and the Kingdom of Denmark on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, 19 October 2005, OJ L299/62 and updated 21 March 2013, OJ 2013 L79, 4 – takes precedence where both parties are resident in a EU Member State, Art 26(6) Hague Convention.
17 Andrew Dickinson, “Background and Introduction to the Regulation”, in Andrew Dickinson and Eva Lein, The Brussels I Regulation Recast (Oxford University Press, 2015), para 1.13.
18 For example: Peter Birks, “Rights, Wrongs, and Remedies” (2000) 20 Oxford Journal of Legal Studies 9–17; Rafal Zakrzewski, Remedies Reclassified (Oxford University Press, 2005), 43–61; Stephen A Smith, Rights, Wrongs, and Injustices: The Structure of Remedial Law (Oxford University Press, 2019), 6–8.
19 Andrew Burrows, Remedies for Torts and Breach of Contract (Oxford University Press, 4th edn, 2019), 1–2.
20 Ibid, 9.
21 cf Ellerman Lines Ltd v Read [1928] 2 KB 144 (CA), 152–153 (Scrutton LJ) (anti-enforcement injunction on the basis of an arbitration agreement); Bank St Petersburg OJSC v Archangelsky [2014] EWCA Civ 593; [2014] 1 WLR 4360, [29], [31] (anti-enforcement injunction on the basis of a choice of court agreement).
22 The Eleftheria [1970] P 94; Donohue v Armco Inc [2001] UKHL 64; [2002] 1 Lloyd’s Rep 425, [24].
23 Ulrich Magnus, “Prorogation of jurisdiction”, in Ulrich Magnus and Peter Mankowski (eds), Brussels Ibis Regulation – Commentary (Otto Schmidt, 2022), para 40.
24 This obligation is not expressly contained in the Regulation but follows partly from Art 26 and is otherwise “evidently intended to exist as part of the determination in Article 25”, Alex Mills, Party Autonomy in Private International Law (Cambridge University Press, 2018), 130; see also, Magnus, supra n 23, para 173.
25 Hague Convention, Art 6.
26 German Code of Civil Procedure, s 39.
27 Donohue, supra n 22, [24].
28 Ibid, [27].
29 Adrian Briggs, Civil Jurisdiction and Judgments (Routledge, 7th edn, 2021), para 28.20 (“it is likely that the English court will consider that this does not affect or restrict its power to grant relief”); see also Trevor Hartley, Choice-of-Court Agreements under the European and International Instruments (Oxford University Press, 2013), para 10.30 (“The Convention neither prohibits nor requires them: it is neutral”).
30 Briggs, supra n 29, para 28.06.
31 Ibid.
32 Clearlake Shipping Pte v Xiang da Marine Pte Ltd [2019] EWHC 1536 (Comm); [2019] 4 WLUK 616, [53]–[64].
33 Ibid, [61].
34 Samengo-Turner v J & H Marsh & McLennan (Services) Ltd [2007] EWCA Civ 723; [2007] 2 All E.R. (Comm) 813.
35 Petter v EMC Europe Ltd [2015] EWCA Civ 828; [2015] 7 WLUK 833.
36 Clearlake, supra n 32, [59]–[60].
37 SNI Aerospatiale v Lee Kui Jak [1987] AC 871 (PC), 892 (Lord Goff), relying on Bushby v Munday (1821) 5 Madd 297, 307; 56 ER 908, 918 (Sir John Leach VC) while noting that “[t]here are, of course, many other statements in the cases to the same effect”.
38 Ibid; see also British Airways Board v Laker Airways Ltd [1985] A.C. 58, 95 (Lord Scarman); Airbus Industrie GIE v Patel [1999] 1 AC 119 (HL), 131, 141 (Lord Goff).
39 Oberlandesgericht Düsseldorf, Decision of 10 January 1996 – 3 VA 11/95; [1997] ILPr. 320 (translation by the author, emphasis added). See also Laker Airways Ltd v Pan American World Airways, 559 F. Supp. 1124, 1128 (D.D.C. 1983) (“a direct interference”).
40 Anatol Dutta and Christian A Heinze, “Prozessführungsverbote im englischen und europäischen Zivilverfahrensrecht” [2005] 13 Zeitschrift für Europäisches Privatrecht 428, 433–34.
41 Patricia Londono, David Eady, A T H Smith, Lord Eassie, Arlidge, Eady & Smith on Contempt (Sweet & Maxwell, 5th edn, 2019), para 14-1.
42 Case C-159/02 Turner v Grovit [2004] ECR I-3565, [31]; The same reasoning applies in the context of the Brussels I (Recast) Regulation, Ulrich Magnus, “Introduction”, in Magnus and Mankowski, supra n 23, paras 1, 8. See also Case C-185/07 Allianz SpA v West Tankers Inc [2009] ECR I-663 (no anti-suit injunction to enforce an arbitration agreement).
43 Reichsgericht, Judgment of 3 March 1938 – IV 224/37; RGZ 157, 136–41.
44 Thomas Pfeiffer, Internationale Zuständigkeit und prozessuale Gerechtigkeit (Vittorio Klostermann, 1995), 767.
45 Ibid, fn. 238.
46 Reichsgericht, supra n 43, 138–40.
47 Jennifer Antomo, Schadensersatz wegen der Verletzung einer internationalen Gerichtsstandsvereinbarung? (Mohr Siebeck, 2017), 233, 243.
48 Bundesgerichtshof, supra n 8, [29].
49 Oberlandesgericht München, Judgment of 12 December 2019 – 6 U 5042/19; GRUR 2020, 379, [55], [69] (translation by the author); see also Landgericht München I, Judgment of 2 October 2019 – 21 O 9333/19; BeckRS 2019, 25536; Landgericht München I, Judgment of 25 February 2021 – 7 O 14276/20; GRUR-RS 2021, 3995; LG München I, Judgment of 24 June 2021 – 7 O 36/21; GRUR-RS 2021, 17662; Oberlandesgericht Düsseldorf, Judgment of 07 February 2022 – 2 U 27/21; GRUR-RS 2022, 1375 (quashing an anti-anti-suit injunction granted at first instance but confirming the general availability of such orders).
50 Oberlandesgericht Hamm, Judgment of 2 May 2023 – 9 W 15/23; BeckRS 2023, 10005, [7] (translation by the author).
51 Ibid.
52 Oberlandesgericht München, supra n 49, [72].
53 Turner, supra n 42, paras 24–25.
54 For the purposes of this article, English or German law is assumed to be the law applicable to the choice of court agreement. In practice, the determination is not as straightforward, especially since choice of court agreements fall outside the scope of the Rome I Regulation, Art 1(2)(e). For English law, see Lord Collins of Mapesbury and Jonathan Harris (eds), Dicey, Morris & Collins: The Conflict of Laws (Sweet & Maxwell, 16th edn, 2022), para 12-069. For German law, see Evgenia Peiffer and Marcus Weiler, “Vertraglicher Schadensersatzanspruch wegen Verletzung von Gerichtsstands- und Schiedsvereinbarungen – Teil I” (2020) Recht der internationalen Wirtschaft 321, 325.
55 Ellerman Lines, supra n 21.
56 Union Discount Co v Zoller [2001] EWCA Civ 1755; [2002] 1 WLR 1517.
57 Starlight Shipping Co v Allianz Marine & Aviation Versicherungs AG [2014] EWCA Civ 1010; [2014] 2 Lloyd’s Rep 544, [19]–[20]; see also Starlight Shipping Co v Allianz Marine & Aviation Versicherungs AG [2014] EWHC 3068 (Comm); [2015] 2 All E.R. (Comm) 747, [89] and the obiter dicta in Donohue, supra n 22, [36] (Lord Bingham), [48] (Lord Hobhouse), AES Ust-Kamenogorsk Hydropower Plant LLP v Ust-Kamenogorsk Hydropower Plant JSC [2013] UKSC 35, [2013] 1 WLR 1889 [25], and The Alexandros T [2013] UKSC 70; [2014] 1 All ER 590, [131]–[132], [135].
58 Briggs, supra n 29, para 222.
59 See infra, 222.
60 Bundesgerichtshof, supra n 8.
61 Bundesgerichtshof, supra n 8, [33].
62 Bundesgerichtshof, supra n 8, [17].
63 Starlight Shipping [2014] EWCA Civ 1010, supra n 57, [15]–[16].
64 Namely Starlight Shipping [2014] EWHC 3068 (Comm), supra n 57.
65 Case C-590/21 Charles Taylor Adjusting v Starlight Shipping, request for preliminary ruling of 23 September 2021.
66 Case C-590/21 Charles Taylor Adjusting v Starlight Shipping, Opinion of AG Richard de la Tour, [52]–[55].
67 Bundesgerichtshof, supra n 8, [30].
68 Bundesgerichtshof, supra n 8, [31].
69 Bundesgerichtshof, supra n 8, [47].
70 James Ruddell, “Monetary Damages for Wrongful Foreign Proceedings” (2015) Lloyd’s Maritime and Commercial Law Quarterly 9, 13.
71 It should be noted that the UK is currently considering becoming a Contracting State to the 2019 Hague Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters, see http://bit.ly/3JngkY5 (accessed on 19 June 2023). Under Art 7(d) of that Convention, recognition and enforcement may be refused if the judgment was in breach of a choice of court agreement. The Convention would apply to judgments given by courts of the (other) Contracting States, notably including the Member States of the EU.
72 See Hague Convention, Art 8(2); Trevor Hartley and Masato Dogauchi, Convention of 30 June 2005 on Choice of Court Agreements, Explanatory Report (2013), para 166.
73 Adrian Briggs, The Conflict of Laws (Oxford University Press, 4th edn, 2019), 154.
74 The conditions in full are set out in the German Code of Civil Procedure, ss 328, 722(1), 723(2)(2).
75 Bundesgerichtshof, Judgment of 26 March 1969 – VIII ZR 194/68; BGHZ 52, 30, [36]–[40].
76 Ibid, [37].
77 Ibid, [38].
78 Turner, supra n 42, [25].
79 See supra, 218.
80 Airbus Industrie, supra n 38, 133.
81 Adrian Briggs, “The Impact of Recent Judgments of the European Court on English Procedural Law and Practice” [2005] 124 Zeitschrift für Schweizerisches Recht 231, 235.
82 See supra n 22; Bouygues Offshore SA v Caspian Shipping Co (Nos 1, 3, 4 and 5) [1998] 2 Lloyd’s Rep 461.
83 Briggs, supra n 29, para 29.06.
84 Donohue, supra n 22, [24] (emphasis added).
85 Donohue, supra n 22, [24].
86 Tweedle v Atkinson (1861) 1 B & S 393, 121 ER 762.
87 Briggs, supra n 81, 236.
88 Briggs, supra n 29, para 29.02; cf The Alexandros T, supra n 57; Starlight Shipping, supra n 57; Hin-Pro International Logistics Ltd v Compania Sud Americana de Vapores SA [2015] EWCA Civ 401; [2016] 1 All E.R. (Comm) 417; CMA CGM SA v Hyundai Mipo Dockyard Co Ltd [2008] EWHC 2791 (Comm); [2009] 1 Lloyd’s Rep 213 (concerning an arbitration agreement).
89 Starlight Shipping [2014] EWCA Civ 1010, supra n 57, [12]–[17].
90 CMA CGM, supra n 88, [37]–[40].
91 Edwin Peel, “How Private is English Private International Law?”, in Andrew Dickinson and Edwin Peel (eds), A Conflict of Laws Companion (Oxford University Press, 2021), 299, 304–306.
92 The Sennar (No 2) [1985] 1 WLR 490.
93 Adrian Briggs, Agreements on Jurisdiction and Choice of Law (Oxford University Press, 2008), para 6.05.
94 German Code of Civil Procedure, s 38(1); for EU law, see Briggs, Agreements, supra n 93, para 8.04.
95 Settled case law since Bundesgerichtshof, Judgment of 29 February 1968 – VII ZR 102/65; BGHZ 49, 384; most recently Bundesgerichtshof, supra n 8, [26].
96 Seminally: Gerhard Schiedermair, Vereinbarungen im Zivilprozess (Röhrscheid, 1935), 40, 100; Hendrik Schultzky, “§ 38 ZPO”, in Richard Zöller (ed), Zivilprozessordnung: ZPO (Otto Schmidt, 34th edn, 2022), para 4.
97 Briggs, Agreements, supra n 93, para 8.75.
98 Bundesgerichtshof, supra n 8, [26].
99 Ibid.
100 Ibid, [29].
101 Mills, supra n 24, 129; see also supra, 222–224.
102 See supra, 223.
103 Similarly: Andrew Dickinson, “Taming Anti-suit Injunctions”, in Dickinson and Peel, supra n 91, 77, 109.
104 British Airways Board v Laker Airways Ltd [1984] Q.B. 142 (CA), 185–86 (Sir John Donaldson M.R.)
105 Adrian Briggs, “The Principle of Comity in Private International Law” (2012) 354 Recueil des Cours 181.
106 Magnus, supra n 42, [2a]; Case C-116/02 Erich Gasser GmbH v MISAT Srl [2003] ECR I-14963, [72]; Turner, supra n 42, [24].
107 See supra n 7.
108 Briggs, supra n 105, 88, 134.
109 SNI Aerospatiale, supra n 37, 892 (Lord Goff).
110 See supra, 215.
111 SNI Aerospatiale, supra n 37, 892 (Lord Goff); Airbus Industrie, supra n 38, 133 (Lord Goff).
112 Enka Insaat ve Sanayi AS v OOO Insurance Company Chubb [2020] UKSC 38; [2020] 1 WLR 4117, [180], [184] (Lords Hamblen and Leggatt); The Angelic Grace [1995] 1 Lloyd’s Rep 87, 96. Both cases concerned arbitration agreements, but the cited rationale applies equally to choice of court agreements. See also Highland Crusader Offshore Partners LLP v Deutsche Bank AG [2009] EWCA Civ 725; [2010] 1 WLR 1023, [50].
113 OT Africa Line Ltd v Magic Sportswear Corp [2005] EWCA Civ 710; [2006] 1 All ER (Comm), [32] (Longmore LJ); see also Clearlake, supra n 32, [33] (Bryan J: “comity requires that [the] agreement is respected”, emphasis added)
114 Union Discount, supra n 56, [23]–[26] (Schiemann LJ).
115 Starlight Shipping [2014] EWCA Civ 1010, supra n 57, [15]–[16]; The Alexandros T, supra n 57, [39].
116 Most pointedly: The Alexandros T, supra n 57, [132].
117 Starlight Shipping [2014] EWCA Civ 1010, supra n 57, [16] (Longmore LJ).
118 Godard v Gray (1870) L.R. 6 Q.B. 139, 149–150; Schibsby v Westenholz (1870) L.R. 6 Q.B. 155, 159; Adams v Cape Industries Plc [1990] Ch. 433 (CA) 513.
119 Adrian Briggs, “Recognition of Foreign Judgments: A Matter of Obligation” (2013) 129 Law Quarterly Review 87, 90–92.
120 Adams, supra n 118.
121 Vizcaya Partners Ltd v Picard [2016] UKPC 5; [2016] 3 All ER 181.
122 Rubin v Eurofinance SA [2012] UKSC 46; [2013] 1 AC 236.
123 Briggs, supra n 105, 150.
124 Similarly: Ibid, 152–53.
125 James Edelman and Madeleine Salinger, “Comity in Private International Law and Fundamental Principles of Justice”, in Dickinson and Peel, supra n 91, 325, 327–28; Seminally: Joseph Story, Commentaries on the Conflict of Laws (Hillard, Gray, and Company, 1834), § 23.
126 Edelman and Salinger, supra n 125, 337.
127 See supra, 225–227.
128 Turner, supra n 42, [27].
129 Turner, supra n 42, [28].
130 Bundesgerichtshof, supra n 8, [30].
131 Bundesgerichtshof, supra n 8, [30].
132 Bundesgerichtshof, supra n 8, [31], [33].
133 See supra, 223.
134 Recast Brussels I Regulation, Recital 26.
135 See supra, 218.
136 Turner, supra n 42, [24].
137 Treaty establishing the European Communities, Arts 61(c), 65; Treaty on the Functioning of the European Union, Arts 67(4), 81.
138 Dickinson, supra n 17, para 1.68.
139 Magnus, supra n 42, [2a].
140 For example: Gasser, supra n 106; Turner, supra n 42; West Tankers, supra n 42.