Choice of law case law

Question 1

Macmillan Inc v Bishopsgate Investment Trust (No 3)

(INTRODUCTION TO CHOICE OF LAW; CHOICE OF LAW IN PROPERTY - SOME GENERAL ISSUES - Characterisation)

Answer 1

Facts: the Maxwells owned a share in Macmillan (NY company), which owned 52% of another company, Berlioz (NY company). The Maxwells approached a consortium of London banks got a personal loan with the 52% shares as security for that loan. They did not repay the loan and the bank acquired the shares. Macmillan brought a restitutionary claim, arguing that the shares were not the Maxwell’s to sell. The issue was whether the claim should be characterised as a restitutionary claim (in which case English law would apply) or a property claim (in which case NY law would apply).

Law: to characterise the dispute, the courts will look to the true issue(s) in dispute, not how the claim is formulated. This is done by applying the law of the forum, but with an open mind where concepts are specific to English law or the competing foreign law. In this case, the claim should properly be characterised as a property claim.

Question 2

Raiffeisen Zentralbank Osterreich AG v Five Star General Trading LLC

(INTRODUCTION TO CHOICE OF LAW; CHOICE OF LAW IN PROPERTY - SOME GENERAL ISSUES - Characterisation)

Answer 2

Facts: a policy of marine insurance was governed by English law. The owners of a ship (an Irish company) insured a ship with French insurers under the policy. The Irish company sold its claim against the French company to a third person. When you sell a right, you have to notify the debtor (the French company), so they know who they should pay their debt too. The notice was validly given under English law but not under French law. One party said the question of whether valid notice was given was a matter of contract law (which would apply English law), and the other said that if you’re selling a debt, that’s the same as selling property, which is a question of property law (which would apply French law).

Law: the court called for a “broad internationalist spirit” in characterisation. The Rome Convention would look to the law underlying the debt. This was English law, so the notice was given validly.

Question 3

Haugesund Kommune v Depfa ACS Bank

(INTRODUCTION TO CHOICE OF LAW; CHOICE OF LAW IN PROPERTY - SOME GENERAL ISSUES - Characterisation)

Answer 3

Facts: not important

Law: the courts will apply the law of the forum with an international mindset. The Norwegian concept of “capacity” (to enter a contract) was different to the English concept, and there was no reason the English should be preferred. Instead, the concept of “capacity” was given a broad, internationalist meaning.

Question 4

Kireeva v Bedzhamov

(INTRODUCTION TO CHOICE OF LAW; CHOICE OF LAW IN PROPERTY
- CHOICE OF LAW IN PROPERTY - Immovable property)

Answer 4

Facts: not important

Law: the court explained the rationale behind the rule that the applicable law in relation to immovable property is the lex situ. This is because of the principle of territorial sovereignty, which is a matter of public policy. Also, in many countries if you have a property right in an immovable, you have to register it in some registry, and domestic actors will not accept a foreign judgment on what is prescribed in such a registry.

Question 5

Winkworth v Christie, Manson & Woods

(INTRODUCTION TO CHOICE OF LAW; CHOICE OF LAW IN PROPERTY - CHOICE OF LAW IN PROPERTY - Movable property)

Answer 5

Facts: a person in England had a painting stolen from them. The painting was taken to Italy and sold to someone there. That person then delivered the painting to an auctioneer in England to sell. The question was which law governs.

Law: the choice of law rule for movable property is that the applicable law is the law of the lex situ at the time of the transfer of the proprietary interest. This was when the painting was sold – so Italy. There was no exception because the painting was stolen. The court recognised that there might be exceptions where the location of the property is accidental or incidental, or where there is a bad faith purchaser.

Question 6

A-G for NZ v Ortiz

(INTRODUCTION TO CHOICE OF LAW; CHOICE OF LAW IN PROPERTY - CHOICE OF LAW IN PROPERTY - Movable property)

Answer 6

Facts: a piece of Māori art was excavated from the ground in New Zealand. Under the law of NZ, if you find a piece of art like that, you are not allowed to smuggle it out of the country and sell it for your own personal gain. This is what happened – the person tried to sell it in London. The government of NZ appeared in the London court to stop the sale – relying on NZ legislation which says that if someone tries to smuggle art, that art will be taken from them and will become the property of the NZ state.

Law: the court found that NZ law applies since the transfer of proprietary ownership happened at the time of smuggling, in NZ. However, they found that under NZ law, the government did not have possession because the statute provided that the NZ government would have a proprietary interest only if the property was found by customary authorities.

Question 7

Raiffeisen Zentralbank Osterreich AG v Five Star General Trading

(INTRODUCTION TO CHOICE OF LAW; CHOICE OF LAW IN PROPERTY
- CHOICE OF LAW IN PROPERTY -Contractual rights)

Answer 7

Facts: as above

Law: intangible property (assignment of contractual rights) should be characterised as a contractual issue to determine the applicable law in line with Rome I, even though English law would consider it a property issue. The applicable law is the law that applies to the contract between the assignor and assignee under Rome I.

Question 8

Re Ross

(INTRODUCTION TO CHOICE OF LAW; CHOICE OF LAW IN PROPERTY
- CHOICE OF LAW IN PROPERTY - Renvoi?)

Answer 8

Facts: not important

Law: renvoi applies in cases of transfer of property through secession

Question 9

Glencore International v Metro Trading International

(INTRODUCTION TO CHOICE OF LAW; CHOICE OF LAW IN PROPERTY
- CHOICE OF LAW IN PROPERTY - Renvoi?)

Answer 9

Facts: not important

Law: it was suggested that there is a case for applying renvoi in all property matters (not just secession) since the lex situs rule is based on practical control exercised by a state

Question 10

Iran v Berend

(INTRODUCTION TO CHOICE OF LAW; CHOICE OF LAW IN PROPERTY
- CHOICE OF LAW IN PROPERTY - Renvoi?)

Answer 10

Facts: title to a historical artefact originating in Iran, bought in NY and delivered to Paris

Law: renvoi seen as a useful tool but not applied

Question 11

Blue Sky One v Mahan Air

(INTRODUCTION TO CHOICE OF LAW; CHOICE OF LAW IN PROPERTY
- CHOICE OF LAW IN PROPERTY - Renvoi?)

Answer 11

Facts: mortgages of aircraft in the Netherlands

Law: renvoi was rejected in cases of property transfer between living people on the basis that it is too uncertain

Question 12

Committeri v Club Méditerranée SA (t/a Club Med Business)

(CHOICE OF LAW IN CONTRACT - SCOPE OF THE ROME CONVENTION / ROME I REGULATION)

Answer 12

Facts: a man employed by company, company sent employee to France for team building exercise. The company used a French company to book the holiday. The employee was involved in a rock climbing accident and injured himself. There was no direct contractual relationship between the employee and the organizer because the contract was entered into by the employer. The question was whether this was a choice of law issue for a contractual obligation or non-contractual obligation.

Law: contractual obligation is an autonomous EU concept meaning an obligation which is freely assumed by the defendant towards the claimant. This was a freely assumed obligation, so Rome I applied.

Question 13

Beximco Pharmaceuticals v Shamil Bank of Bahrain

(CHOICE OF LAW IN CONTRACT - ART.3 – CHOICE “EXPRESSED” / “MADE EXPRESSLY” - Must be the law of a state)

Answer 13

Facts: the parties agreed for the “principles of the glorious Sharia’a” to apply.

Law: the court held that this is not a valid clause because there is more than one branch of Sharia’a law and the parties need to specify which applies. The choice was not specific enough to be valid.

Question 14

Halpern v Halpern

(CHOICE OF LAW IN CONTRACT - ART.3 – CHOICE “EXPRESSED” / “MADE EXPRESSLY” - Must be the law of a state)

Answer 14

Facts: the parties agreed for “Jewish law” to apply.

Law: the court held that although Jewish law does exist and this is specific enough as there aren’t different kinds of Jewish law, Article 3 of Rome I only allows parties to choose the law of a state, so this clause was not valid.

Question 15

Companie Tunisienne de Navigation SA v Companie d’Armement Maritime SA

(CHOICE OF LAW IN CONTRACT - ART.3 – CHOICE “EXPRESSED” / “MADE EXPRESSLY” - Chosen law must be identified or objectively identifiable)

Answer 15

Facts: the parties agreed for the applicable law to be the law of the flag of the vessel.

Law: since this law was objectively identifiable, the choice was valid.

Question 16

ISS Machinery Services Ltd v Aeolian Shipping SA

(CHOICE OF LAW IN CONTRACT - ART.3 – CHOICE “DEMONSTRATED WITH REASONABLE CERTAINTY” / “CLEARLY DEMONSTRATED”)

Answer 16

Facts: not important

Law: implied choice must be a real choice, not a hypothetical choice (a choice the parties would have made had they though about what law governed their relationship)

Question 17

American Motorists Insurance Co (AMICO) v Cellstar Corp

(CHOICE OF LAW IN CONTRACT - ART.3 – CHOICE “DEMONSTRATED WITH REASONABLE CERTAINTY” / “CLEARLY DEMONSTRATED”)

Answer 17

Facts: A issued an insurance policy to cover C and its subsidiaries in respect of the transportation of mobile phones. A and C had their principal offices in Texas, where the policy had been negotiated. A contended that it was not liable to C or its UK subsidiary (CUK) and that English law applied.

Law: the court held that the circumstances surrounding the making of the agreement (that C from its base in Texas chose on behalf of its whole group to negotiate worldwide cover in Texas with insurers also based in Texas) was evidence of an understanding that the policy would be subject to Texan law.

Question 18

Lawlor v Sandvik Mining & Construction Mobile Crushers and Screens Ltd

(CHOICE OF LAW IN CONTRACT - ART.3 – CHOICE “DEMONSTRATED WITH REASONABLE CERTAINTY” / “CLEARLY DEMONSTRATED”)

Answer 18

Facts: L was employed by a company E. L was sent to work in Spain. At some point, L’s contractual status changed from an employee to a sales agent (the agency agreement). S bought E and L was offered a contract of employment containing an English law clause, but this was not agreed. S terminated L’s agency and L sought compensation. He argued that the parties had made an implied choice of English law.

Law: the test for implied choice of law is objective - the claimant must show that on an objective view, the only reasonable conclusion to be drawn from the circumstances was that the parties should taken to have intended the putative law to apply. There was no implied choice on an objective view.

Question 19

Gan Insurance Co Ltd v Tai Ping Insurance Co Ltd

(CHOICE OF LAW IN CONTRACT - ART.3 – CHOICE “DEMONSTRATED WITH REASONABLE CERTAINTY” / “CLEARLY DEMONSTRATED” - Standard form contracts)

Answer 19

Facts: T (a Taiwanese insurance company) insured a factory construction project in Taiwan. T negotiated reinsurance of the risk under a slip policy with G (a London reinsurance business). A fire badly damaged the factory and T claimed under the policy. G claimed against T for non disclosure and misrepresentation. T argued that Taiwanese law governed the reinsurance contract.

Law: the court rejected this argument, finding that there was an implied choice of English law because a standard slip form was used and the London reinsurance market always uses English law. For a different law to apply, the policy would have had to unequivocally point to the intention for Taiwanese law to apply.

Question 20

Gard Marine v Tunnicliffe

(CHOICE OF LAW IN CONTRACT - ART.3 – CHOICE “DEMONSTRATED WITH REASONABLE CERTAINTY” / “CLEARLY DEMONSTRATED” - Standard form contracts)

Answer 20

Facts: use of standard form contract.

Law: English law was implied. The reinsurance was a participation in the London market; it would make no commercial sense for one part of a reinsurance to be governed by one law and another part by another law; the underlying policy was governed by English law; the forum of slip used in the London market was used using a standard form; the Giuliano-Lagarde report refers to the use of a standard form governed by a particular system of law as an indication of a real choice; and the use of London market terminology and London market clauses are clear indicia of a real choice of English law.

Question 21

The Komninos S

(CHOICE OF LAW IN CONTRACT - ART.3 – CHOICE “DEMONSTRATED WITH REASONABLE CERTAINTY” / “CLEARLY DEMONSTRATED” - Jurisdiction and arbitration clauses)

Answer 21

Facts: not important

Law: exclusive jurisdiction agreements are a strong but not decisive indicator of the application of the law of the jurisdiction

Question 22

Compagnie Tunisienne de Navigation SA v Compagnie d’Armament Maritime SA

(CHOICE OF LAW IN CONTRACT - ART.3 – CHOICE “DEMONSTRATED WITH REASONABLE CERTAINTY” / “CLEARLY DEMONSTRATED” - Jurisdiction and arbitration clauses)

Answer 22

Facts: not important

Law: a clause in a contract providing for arbitration in London does not necessarily carry the inference that the proper law of the contract shall be English law. An arbitration clause is less significant than a jurisdiction clause because it is less bound to the country.

Question 23

Egon Oldendorff v Liberia Corp

(CHOICE OF LAW IN CONTRACT - ART.3 – CHOICE “DEMONSTRATED WITH REASONABLE CERTAINTY” / “CLEARLY DEMONSTRATED” - Jurisdiction and arbitration clauses)

Answer 23

Facts: EO was a German commercial partnership. It agreed with Japanese company LC for the ten year charter of two carriers. The charterparty was on the New York Product Exchange form, amended to provide for London arbitration. A dispute arose and the issue of applicable law (English or Japanese) was tried as a preliminary issue. EO argued that there was an implied choice of English law (Art 3). LC argued that there was no choice, so the applicable law was the law of the country most closely connected to the contract - Japanese (Art 4).

Law: the court found that an arbitration clause was generally intended by the parties to operate as a choice of the proper law of the contract unless there were compelling indications to the contrary in the other contractual terms or the surrounding circumstances of the transaction. The parties agreed English arbitration for the determination in London of disputes arising out of a well known English language form of charterparty which contained standard clauses with well known meanings in English law. It was therefore to be inferred that the parties intended that law to apply to the contract.

Question 24

Wahda Bank v Arab Bank Plc

(CHOICE OF LAW IN CONTRACT - ART.3 – CHOICE “DEMONSTRATED WITH REASONABLE CERTAINTY” / “CLEARLY DEMONSTRATED” - Course of dealing between the parties)

Answer 24

Facts: contracts were made for the sale of air defence equipment to the Libyan Armed Services Directorate of Military Procurement. Performance guarantees were issued by WB and ABP gave counter-guarantees. The contract between the buyer and WB for the guarantee was governed by Libyan law. The contract between the sellers and ABP for the counter-guarantee was governed by English law. Demands were made under the guarantees and counter-guarantees but no payments were made. WB brought an action against ABP - the question was what law governed their contract.

Law: the court found that the contract was governed by Libyan law, because it could be inferred that the parties intended the same law to govern both the guarantees and counter-guarantees.

Question 25

FR Lurssen Werft GmbH & Co KG v Halle (CHOICE OF LAW IN CONTRACT - ART.3 – CHOICE “DEMONSTRATED WITH REASONABLE CERTAINTY” / “CLEARLY DEMONSTRATED” - Course of dealing between the parties)

Answer 25

Facts: there was a commission agreement between H, a US resident, and L, a German shipbuilding company. The parties had entered into two contracts for the construction of two yachts, each of which contained an English choice of law clause. The following month they entered into a commission agreement which was silent to the applicable law. Law: the court found that the three contracts were closely related and all of a series, indicating that the parties had implicitly chosen English law for the commission agreement.

Question 26

Marubeni Hong Kong and South China Ltd v Mongolian Government (CHOICE OF LAW IN CONTRACT - ART.3 – CHOICE “DEMONSTRATED WITH REASONABLE CERTAINTY” / “CLEARLY DEMONSTRATED” - Course of dealing between the parties)

Answer 26

Facts: MH entered into a commercial contract with a Mongolian corporation which was guaranteed by the Mongolian finance minister. An early draft of the guarantee included an English choice of law clause but this was absent in the final draft. MH had made it clear that it did not consider Mongolian law to be appropriate (because it was not a neutral law given that one of the parties was a state). Law: the court found that this was sufficient to find that the parties had implicitly chosen English law. It appeared that the English law clause had been accidentally deleted.

Question 27

Samcrete Egypt Engineers and Contractors SAE v Land Rover Exports Ltd (CHOICE OF LAW IN CONTRACT - ART.3 – CHOICE “DEMONSTRATED WITH REASONABLE CERTAINTY” / “CLEARLY DEMONSTRATED” - Course of dealing between the parties)

Answer 27

Facts: S was a 20% shareholder in Technotrade - Land Rover’s distributor in Egypt under an agreement which contained an English choice of law clause. S gave LR a parent company guarantee. The guarantee proposed by LR contained an English choice of law clause but S returned it after deleting that clause. A dispute arose under the guarantee. LR obtained permission to serve out on S and S sought a stay under FNC. Law: the court found that there was no choice of law for the purposes of Article 3. The fact that S had deleted the choice of law clause put forward by LR indicated that the parties made no choice as to the governing law.

Question 28

Islamic Arab Ins Co v Saudi Egyptian American Reinsurance Co (CHOICE OF LAW IN CONTRACT - ART.3 – CHOICE “DEMONSTRATED WITH REASONABLE CERTAINTY” / “CLEARLY DEMONSTRATED” - Other factors)

Answer 28

Facts: IAI was incorporated in the UAE and carried on business in insurance and reinsurance. SEARCO was a Panamanian insurance and reinsurance company with their head office in the US. The parties entered into reinsurance treaties. IAI sought recovery of sums from SEARCO and obtain leave to serve out on SEARCO. SEARCO obtained a stay and IAI appealed. Law: the parties did not expressly choose the applicable law. Though their business has a very real connection with Saudi Arabia, the courts of Saudi Arabia are known to be reluctant to recognise reinsurance contracts. This means that the fact that all the contracts were put through London brokers is highly relevant. Further, it was SEARCO’s practice at the time to operate under the laws of the place where the reinsurance contracts were assumed. These factors indicate that the parties intended for English law to apply.

Question 29

Print Concept GmbH v GEW (EC) Ltd (CHOICE OF LAW IN CONTRACT - ROME CONVENTION ART.4 – APPLICABLE LAW IN THE ABSENCE OF CHOICE - Art.4(2) – General presumption)

Answer 29

Facts: PC, a German distributor of products manufactured in England by GEW, appealed against the decision that the parties’ oral distributorship was governed by English law. PC argued that the obligation which was characteristic of the contract was the distribution of the products, which took place in German speaking countries in Europe, so that German law should apply. Law: the court found that the characteristic performance was the sale of goods by GEW to PC, which took place in England (the location of the manufacturer), meaning that English law applied.

Question 30

Apple Corps Ltd v Apple Computer Inc (CHOICE OF LAW IN CONTRACT - ROME CONVENTION ART.4 – APPLICABLE LAW IN THE ABSENCE OF CHOICE - Art.4(2) – General presumption)

Answer 30

Facts: ACL was an English record company and ACI was a US producer of computers and software. ACL claimed that ACI had broken an agreement between the parties by launching a web-based music store which enabled the public to download songs. The agreement did not contain a choice of law clause. ACL was given permission to serve out on ACI and ACI appealed. Law: the court held that because the heart of the contract was a negative agreement (not to use their own trade marks in each other’s field of use), there was no characteristic performance for the purpose of Article 4(2). Therefore, the court had to determine which country the contract was most closely connected with under Article 4(1). It found that the closest connection was with England, because the agreement was part of a settlement of English litigation. Therefore, English law applied.

Question 31

Credit Lyonnais v New Hampshire Insurance Co Ltd (CHOICE OF LAW IN CONTRACT - ROME CONVENTION ART.4 – APPLICABLE LAW IN THE ABSENCE OF CHOICE - Art.4(2) – General presumption)

Answer 31

Facts: insurance policy Law: the party with the greater risk (the insurer) is the characteristic performer

Question 32

Ennstone Building Products Ltd v Stanger Ltd (CHOICE OF LAW IN CONTRACT - ROME CONVENTION ART.4 – APPLICABLE LAW IN THE ABSENCE OF CHOICE - Art.4(2) – General presumption)

Answer 32

Facts: contract for the provision of stone between two English countries. The parties anticipated but did not provide in the contract that the characteristic performance would be effected in Scotland. They anticipated that the seller would use their Scottish office to perform the contract but did not put this in writing. Law: the court said that the law of the principal place of business presumptively governs, not the law of the characteristic performer’s Scottish office because this was not expressly agreed in the contract.

Question 33

Iran Continental Shelf Oil Company v IRI International Corporation (CHOICE OF LAW IN CONTRACT - ROME CONVENTION ART.4 – APPLICABLE LAW IN THE ABSENCE OF CHOICE - Art.4(2) – General presumption)

Answer 33

Facts: US business with principal place of business in the US wanted to provide services in Iran. The US government has been sanctioning Iran for many years. To get around these sanctions, the parties agreed that the service provider’s performance would be conducted through their London office. Law: the parties can agree for a place other than the principal place of business to be the place of the characteristic performance. It was therefore held that English law applied.

Question 34

Societe Nouvelle des Papeteries de l’Aa SA v BV Machinefabriek BOA 1992 Nederlands Jurisprudentie 750 (CHOICE OF LAW IN CONTRACT - ROME CONVENTION ART.4 – APPLICABLE LAW IN THE ABSENCE OF CHOICE - Art.4(5) – Disregarding the presumptions)

Answer 34

Netherlands case Facts: not important Law: strong presumption theory - Article 4(2) creates a strong presumption in favour of the law of the characteristic performer's habitual residence which it is difficult to displace. It must be shown that the habitual residence of the characteristic performer of the contract has no real significance as a connecting factor.

Question 35

Caledonia Subsea Ltd v Microperi SRL 2001 SC 716 (OH), 2003 SC 70 (Scotland) (CHOICE OF LAW IN CONTRACT - ROME CONVENTION ART.4 – APPLICABLE LAW IN THE ABSENCE OF CHOICE - Art.4(5) – Disregarding the presumptions)

Answer 35

Scottish case Facts: not important Law: strong presumption theory - Article 4(2) creates a strong presumption in favour of the law of the characteristic performer's habitual residence which it is difficult to displace through Article 4(5)

Question 36

Credit Lyonnais v New Hampshire Insurance Co Ltd (CHOICE OF LAW IN CONTRACT - ROME CONVENTION ART.4 – APPLICABLE LAW IN THE ABSENCE OF CHOICE - Art.4(5) – Disregarding the presumptions)

Answer 36

Facts: not important: Law: weak presumption theory -Article 4(2) creates a weak presumption in favour of the law of the characteristic performer's habitual residence which can be relatively easily displaced through Article 4(5) if another country is more closely connected to the claim.

Question 37

Samcrete Egypt Engineers and Contractors SAE v Land Rover Exports Ltd (CHOICE OF LAW IN CONTRACT - ROME CONVENTION ART.4 – APPLICABLE LAW IN THE ABSENCE OF CHOICE - Art.4(5) – Disregarding the presumptions)

Answer 37

Facts: as above Law: while a straight reading of Article 4 renders the presumption weak (as per Credit Lyonnais), unless 4(2) is regarded as a rule of thumb which requires numerous contrary factors to be displaced, the intention of the convention is likely to be subverted. The court suggested as a two-stage test: identify characteristic performance, assess factors to disregard the presumption. English law applied.

Question 38

Bank of Baroda v Vysya Bank Ltd (CHOICE OF LAW IN CONTRACT - ROME CONVENTION ART.4 – APPLICABLE LAW IN THE ABSENCE OF CHOICE - Art.4(5) – Disregarding the presumptions)

Answer 38

Not covered

Question 39

Definitely Maybe (Touring) Ltd v Marek Lieberberg Konzertagentur GmbH (CHOICE OF LAW IN CONTRACT - ROME CONVENTION ART.4 – APPLICABLE LAW IN THE ABSENCE OF CHOICE - Art.4(5) – Disregarding the presumptions)

Answer 39

Facts: Oasis concert in Germany Law: there is a dispute about whether Article 4(2) creates a strong or weak presumption. If a wide effect were given to article 4(5), it would render the presumption in article 4(2) of no value. The court was not minded to read words into Article 4 to give effect to the supposed intentions of the drafters. Therefore, the presumption was relatively weak. The court also rejected a stage-based approach to this article. German law applied.

Question 40

Ennstone Building Products Ltd v Stanger Ltd (CHOICE OF LAW IN CONTRACT - ROME CONVENTION ART.4 – APPLICABLE LAW IN THE ABSENCE OF CHOICE - Art.4(5) – Disregarding the presumptions)

Answer 40

Facts: as above Law: If the presumption is to be of any real effect, it must be taken to apply except where the evidence clearly shows that the contract is more closely connected with another country. English law applied.

Question 41

Intercontainer Interfrigo SC (ICF) v Balkenende Oosthuizen BV (CHOICE OF LAW IN CONTRACT - ROME CONVENTION ART.4 – APPLICABLE LAW IN THE ABSENCE OF CHOICE - Art.4(5) – Disregarding the presumptions)

Answer 41

ECJ decision Facts: not important Law: the court gave "guidance" on the interpretation of Article 4(5) but essentially just repeated it. It said that “Article 4(5) of the Convention must be construed as meaning that, where it is clear from the circumstances as a whole that the contract is more closely connected with a country other than that determined on the basis of one of the criteria set out in Article 4(2) to (4) of the Convention, it is for the court to disregard those criteria and apply the law of the country with which the contract is most closely connected”.

Question 42

Molton Street Capital LLP v Shooters Hill Capital Partners LLP (CHOICE OF LAW IN CONTRACT - ROME I REGULATION ART.4 – APPLICABLE LAW IN THE ABSENCE OF CHOICE - Disregarding the fixed choice-of-law rules)

Answer 42

Facts: not important Law: “The new language and structure [of the escape clause] suggests a higher threshold [than the escape clause in the Rome Convention], which requires that the cumulative weight of the factors connecting the contract to another country must clearly and decisively outweigh the desideratum of certainty in applying the relevant test in Article 4.1 or 4.2.”

Question 43

Bill Kenwright Ltd v Flash Entertainment FZ LLC (CHOICE OF LAW IN CONTRACT - ROME I REGULATION ART.4 – APPLICABLE LAW IN THE ABSENCE OF CHOICE - Disregarding the fixed choice-of-law rules)

Answer 43

Facts: not important Law: conflicted with the approach taken in Molton by observing that “in the present case, the presumption is weak and displaced by the fact that the Settlement Agreement is more closely connected with England than Abu Dhabi".

Question 44

BRG Noal GP Sarl v Kowski (CHOICE OF LAW IN CONTRACT - ROME I REGULATION ART.4 – APPLICABLE LAW IN THE ABSENCE OF CHOICE - Disregarding the fixed choice-of-law rules)

Answer 44

Facts: not important Law: more recent case also suggesting weak.

Question 45

Szalatnay-Stacho v Fink (CHOICE OF LAW IN TORT - COMMON LAW - Torts in England)

Answer 45

Facts: defamation case where claimant brought proceedings against a Czech military officer, who sent a memo to the Czech government saying they were a Nazi collaborator. The alleged tort occurred in England, because the Czech government was operating in England as Czechslovakia was occupied. Law: if the tort occurs in England, apply English law.

Question 46

Phillips v Eyre (CHOICE OF LAW IN TORT - COMMON LAW - Torts in foreign territory – the ‘double-actionability’ rule)

Answer 46

Facts: defendant was British governor of Jamaica, there was an uprising and the governor used brutal force to suppress this, hundreds of people died and were imprisoned/tortured, including Mr Phillips who brought proceedings in England when the government returned to England. Under English law, the claim was good. Under Jamaican law, it was not, because the local parliament passed legislation saying that anyone involved in crushing the uprising would not be liable. Law: the House of Lords said that a claimant bringing a claim for a foreign tort needs to show the tort is actionable under both English law and the law of the place of the tort. Since it was not actionable under Jamaican law, it failed.

Question 47

Boys v Chaplin (CHOICE OF LAW IN TORT - COMMON LAW - Torts in foreign territory – the ‘double-actionability’ rule)

Answer 47

Facts: not important Law: the House of Lords said exceptionally they would dis-apply the double actionability rule and only apply English law, where the claim is strongly connected with England

Question 48

Red Sea Insurance Co v Bouygues SA (CHOICE OF LAW IN TORT - COMMON LAW - Torts in foreign territory – the ‘double-actionability’ rule)

Answer 48

Facts: not important Law: the Privy Council said exceptionally they would dis-apply the double actionability rule and only apply foreign law, where the claim is strongly connected with the foreign jurisdiction

Question 49

Distillers v Thompson (CHOICE OF LAW IN TORT - COMMON LAW - Locating a cross-border tort)

Answer 49

Facts: not important Law: when locating a cross border tort, “The right approach is, when the tort is complete, to look back over the series of events constituting it and ask the question, where in substance did this cause of action arise?”

Question 50

Church of Scientology of California v Commissioner of Metropolitan Police (CHOICE OF LAW IN TORT - COMMON LAW - Locating a cross-border tort)

Answer 50

Facts: CoS brought proceedings against CMP for sending an allegedly defamatory letter to their German counterparts, the question was whether this was an English tort or a German tort. Law: the court held that libel is committed where it is published, i.e., received and read. If you send a letter from England to Germany, they open and read it in Germany, it is a foreign tort and you apply the double actionability rule.

Question 51

Lewis v King (CHOICE OF LAW IN TORT - COMMON LAW - Locating a cross-border tort)

Answer 51

Facts: not important Law: libel/slander/defamation occurred where defamation is received and read. Where that is online e.g., in a blog, each publication or reading constitutes a separate tort, so you could potentially have millions of publications.

Question 52

Re T&N Ltd (CHOICE OF LAW IN TORT - PRIVATE INTERNATIONAL LAW (MISCELLANEOUS PROVISIONS) ACT 1995 - Preliminaries)

Answer 52

Facts: tortious act occurred before 1 May 1996 but the cancer appeared after that date. It was unclear whether the case fell within the temporal scope or not. Law: the court held that it fell outside the scope, because you focus on the act or omission, not the consequences.

Question 53

Trafigura Beheer BV v Kookmin Bank Co (CHOICE OF LAW IN TORT - PRIVATE INTERNATIONAL LAW (MISCELLANEOUS PROVISIONS) ACT 1995 - Preliminaries)

Answer 53

Facts: a claim was brought under a foreign cause of action, there was no equivalent in English law. The question was how this claim should be characterised. Law: The court held that “tort” is to be construed broadly so as to include all non-contractual civil wrongs that give rise to a remedy. The court will decide whether the issue is a tort issue not only by reference to English legal concepts, but taking a broad internationalist view.

Question 54

Zubaydah v Foreign, Commonwealth and Development Office (CHOICE OF LAW IN TORT - PRIVATE INTERNATIONAL LAW (MISCELLANEOUS PROVISIONS) ACT 1995 - Locating a cross-border tort)

Answer 54

Facts: Guantanamo prisoner detained and tortured all around the world bringing claim against UK government for their role in operation. Law: for personal injury the applicable is the law of the place where the individual was when he was injured. In this case, he was tortured in numerous different countries. This was enough to displace this rule.

Question 55

Anton Durbeck GmbH v Den Norske Bank ASA (CHOICE OF LAW IN TORT - PRIVATE INTERNATIONAL LAW (MISCELLANEOUS PROVISIONS) ACT 1995 - Locating a cross-border tort)

Answer 55

Facts: concerned bananas which perished in the Panama Canal. Law: the applicable law for property damage is the location the property was when it was damaged. In this case, the court held that if the property was damaged in a particular country, you apply the law of that country, so the law of Panama.

Question 56

Morin v Bonham’s and Brooks (CHOICE OF LAW IN TORT - PRIVATE INTERNATIONAL LAW (MISCELLANEOUS PROVISIONS) ACT 1995 - Locating a cross-border tort)

Answer 56

Facts: a person wanted to buy a vintage Ferrari and collected a prospectus from Bonham’s and Brooks, an auction house, in London and went to its subsidiary in Monaco to buy the car. In the prospectus description it said the Ferrari was not used very much, but it turned out to be used, and the man brought proceedings in England for negligent misstatement. Law: the court held that when identifying the "most significant elements" of the claim, the focus should be on the moment where the loss irreversibly happened. In this case, the court held that the most important element is reliance, which is completed where the transaction is made, in this case in Monaco.

Question 57

Edmunds v Simmonds (CHOICE OF LAW IN TORT - PRIVATE INTERNATIONAL LAW (MISCELLANEOUS PROVISIONS) ACT 1995 - The Section 12 exception)

Answer 57

Facts: traffic accident in Spain, both claimant and defendant were English. Law: the general rule will be displaced if the parties have a common habitual residence, as in the present case, meaning that English law applied.

Question 58

Trafigura Beheer BV v Kookmin Bank (CHOICE OF LAW IN TORT - PRIVATE INTERNATIONAL LAW (MISCELLANEOUS PROVISIONS) ACT 1995 - The Section 12 exception)

Answer 58

Facts: series of contracts governed by English law Law: the general rule will be displaced if the tort arises out of or concerns a pre-existing contractual relationship, and the law which governs the contract is different to the applicable law. Then the law of the contract applies.

Question 59

VTB Capital plc v Nutritek International Corp (CHOICE OF LAW IN TORT - PRIVATE INTERNATIONAL LAW (MISCELLANEOUS PROVISIONS) ACT 1995 - The Section 12 exception)

Answer 59

Facts: not important. Law: The general rule should not be dislodged easily, this is reflected in the case law, and the word “substantially” is key

Question 60

Zubaydah v Foreign, Commonwealth and Development Office (CHOICE OF LAW IN TORT - PRIVATE INTERNATIONAL LAW (MISCELLANEOUS PROVISIONS) ACT 1995 - The Section 12 exception)

Answer 60

Facts: as above. Law: the general rule will be displaced if there is no reasonable/legitimate expectations for the application of the lex loci delicti (the law of the place of the tort) e.g., if someone was kidnapped and sent to Thailand to be tortured, and neither party knew where they were. This case was exceptional.

Question 61

Homawoo v GMF Assurances, Case C-412/10 (ECJ) (CHOICE OF LAW IN TORT - THE ROME II REGULATION - Scope and commencement)

Answer 61

Facts: the accident occurred on 29 August 2007 but the proceedings were commenced on 8 January 2009. The question was whether Rome II applied. Article 31 stated that Rome II applied to torts after 29 August 2007 whereas Article 32 stated 11 January 2009. Law: the ECJ said Rome II applies to events giving rise to damage occurring after 11 January 2009. They essentially rewrote Article 31, but it does make the law more coherent. Both the events giving rise to damage and the proceedings must commence after 11 January 2009.

Question 62

Hillside (New Media) Ltd v Baasland (CHOICE OF LAW IN TORT - THE ROME II REGULATION - Art.4 – General rule)

Answer 62

Facts: claimant had a gambling problem, he placed huge bets in four countries and lost a lot of money, after several years he brought proceedings against Hillside (the betting company) and sued them for negligence for not telling him not to bet so much money. The question was where the damage was suffered. He used his credit card to move money from country X to his betting account with a bank in England. When he placed the bets, the money left this betting account. Law: the court found that the losses occurred when he instructed the betting company to take the money from that account and place it on the bet, so the losses were suffered where the funds were held, in England. This is the point at which the money was irretrievably lost. Before this point, he could have taken the money back. Therefore, English law applied.

Question 63

Lazar v Allianz [2015] EUECJ C‑350/14 (10 December 2015) (CHOICE OF LAW IN TORT - THE ROME II REGULATION - Art.4 – General rule)

Answer 63

Facts: car accident in Italy, Romanian woman died, her Romanian family suffered mental anguish in Romania, they commenced proceedings against the insurance company, the question was whether Romanian (where the indirect victims suffered harm) or Italian (where the direct victim suffered harm) law governed. Law: the court held that the applicable law is where the direct victim suffers harm, even if the claim is brought by indirect victims who suffered their harm elsewhere. Therefore, Italian law applied.

Question 64

Kingdom of Sweden v Serwin (CHOICE OF LAW IN TORT - THE ROME II REGULATION - Art.4 – General rule)

Answer 64

Facts: Sweden made a bad investment in a company by transferring money to a bank account in another country and received shares in the company. Law: contrast with Hillside. The court said the loss was suffered in the place where the shares were acquired (Sweden), since this is where the loss was irreversible.

Question 65

Winrow v Hemphill (CHOICE OF LAW IN TORT - THE ROME II REGULATION - Art.4 – General rule)

Answer 65

Facts: a group of British soldiers were stationed in Germany with their families for a significant amount of time, they had children who went to school there and homes there, they went on a day out and got into a car accident, a woman injured in the car accident brought proceedings against the driver. The question was where the parties were habitually resident. The victim moved immediately back to England and suffered long term consequences there. Law: the court held that they needed to check where the centre of their lives were when the accident happened, and emphasised the long term nature of the station and the fact that they had no immediate plans to return to England. Therefore, German law applied.

Question 66

Owen v Galgey (CHOICE OF LAW IN TORT - THE ROME II REGULATION - Art.4 – General rule)

Answer 66

Facts: an English man rented a villa in France from an English couple, they jump into the swimming pool without noticing there is no water in there, they bring proceedings against the owner of the villa for not warning them of this, and against French parties responsible for maintenance of the villa. Law: the court said you have to look at this as a collection of several claims – the claimant against the owner, the claimant against the person who maintained the villa, and the claimant against the French insurer. Even though 4(2) applied on face value to one of the claim, the court applied 4(3) to apply French law in all cases. 4(2) might be displaced by 4(3), for example if there are additional defendants with a different habitual residence, and the other circumstances of the case are more closely connected with that residence

Question 67

Stylianou v Toyoshima (CHOICE OF LAW IN TORT - THE ROME II REGULATION - Art.4 – General rule)

Answer 67

Facts: car accident in Australia; English and Japanese resident; claimant suffers indirect harm in England; proceedings in Australia. Law: the court held that it should look at all the circumstances of the case - but these circumstances weren’t enough to apply the escape law, so the law of the place of the accident applied.

Question 68

Pickard v Marshall (CHOICE OF LAW IN TORT - THE ROME II REGULATION - Art.4 – General rule)

Answer 68

Facts: an English person brought proceedings against an English driver in relation to a car accident in France; there were also other parties involved in the accident - an uninsured French driver and a French lorry driver – who he also sued. Law: since there were several defendants who were English and French, the court applied 4(3) since all the claims were connected, so they applied French law to the whole claim since this was the centre of the claim.

Question 69

Silverman v Ryanair DAC (CHOICE OF LAW IN TORT - THE ROME II REGULATION - Art.4 – General rule)

Answer 69

Facts: a person was injured in a pre-boarding accident in England; the claim arose out of a pre-existing Irish contract between the parties Law: the court applied 4(3) to apply Irish law

Question 70

Stylianou v Toyoshima (CHOICE OF LAW IN TORT - THE ROME II REGULATION - Art.14 – ‘Freedom of choice’)

Answer 70

Facts: as above Law: the commencement of proceedings in one country is not enough to show that the parties agreed for the law of that country to apply under Article 14.