C-201/82

JUDGMENT OF 14. 7. 1983 — CASE 201/82

jurisdiction relating to proceedings 2. Article 18 of the Convention of which might be brought by such third 27 September 1968 on Jurisdiction parties, the latter, even if they have and the Enforcement of Judgments in not expressly signed the said clause, Civil and Commercial Matters must may rely upon it provided that, as be interpreted as meaning that it between the insurer and the policy- allows a defendant not merely to holder, the condition as to writing contest jurisdiction but at the same laid down by Article 17 of the time to submit, in the alternative, a Convention has been satisfied and defence on the substance of the case provided that the consent of the without thereby losing the right to insurer in that respect has been clearly raise an objection of want of manifested. jurisdiction.

In Case 2 0 1 / 9 2

R E F E R E N C E t o t h e C o u r t in pursuance of t h e P r o t o c o l of 3 J u n e 1971 o n the Interpretation b y the C o u r t of Justice of the C o n v e n t i o n of 27 September 1968 o n Jurisdiction a n d t h e Enforcement of J u d g m e n t s in Civil a n d Commercial M a t t e r s , b y t h e C o r t e Suprema di C a s s a z i o n e , Sezioni Unite Civili [Supreme C o u r t of Cassation, C o m b i n e d Civil Sections], giving its preliminary decision o n a question of jurisdiction u n d e r Article 41 of t h e Italian C o d e of Civil P r o c e d u r e , in the proceedings p e n d i n g between

GERLING K O N Z E R N SPEZIALE K R E D I T V E R S I C H E R U N G S - A G , h a v i n g its re gi st e re d office in C o l o g n e , AND O T H E R S ,

GERLING v AMMINISTRAZIONE DEL TESORO DELLO STATO

JUDGMENT

Facts and Issues

The facts of the case, the course of the tation, is guaranteed by the above- procedure and the observations sub- mentioned associations or the countries mitted in accordance with Article 20 of in which such payments are due, even if the Statute of the Court of Justice of the the carnet is issued by an association of EEC may be summarized as follows: another State which is also affiliated to the International Road Transport Union.

The payment of taxes and duties found 2. Proceedings before national courts to be due, and supplementary charges and pecuniary penalties incurred for By a writ dated 17 July 1974 the offences in connection with the transpor- Amministrazione del Tesoro, in its

JUDGMENT OF 14. 7. 1983 — CASE 201/82

istration. Having entered an appearance, signed for such a clause. the insurers raised a preliminary Such is the context in which the Corte di objection to the jurisdiction of the Italian Cassazione, by an order dated 28 July court, and went on to elaborate 1982, stayed the proceedings and, arguments of substance in the alternative. requested the Court of Justice to give a In the course of proceedings, the insurers preliminary ruling on the following applied to the Combined Civil Sections questions : of the Corte di Cassazione on a pro- " 1 .

question had its registered office. Thus, apply in favour of those benefici- Article 8 of the 1961 Contract between aries? the pool of insurers and the International 2. Is the effect of confirming the juris- Road Transport Union stipulates that in diction of the court before which an case of dispute between the pool and one action is brought — which comes of the national associations the latter about, under Article 18 of the said shall be entitled to insist on proceedings Convention, as a result of the entry before the court having jurisdiction in of an appearance by the defendant the country in which it has its registered — also produced when the de- office, for the application of the law of fendant, in entering an appearance, that country. besides lodging a preliminary objection to the court's jurisdiction, Although the Brussels Convention of

GERLING v AMMINISTRAZIONE DEL TESORO DELLO STATO

In accordance with Article 5 of the The Commission considers that what is Protocol of 3 June 1971 on the In- actually at issue is a contract of terpretation by the Court of Justice of insurance entered into by a party in his the Convention of 17 September 1968, own name but on behalf of a third party. written observations were submitted by In that type of insurance, the owner of the Commission of the European Com- the interest insured is necessarily a munities, represented by Guido Berardis separate entity from the policy-holder and Georges Kremlis, members of its and is either identified when the contract Legal Department, acting as Agents, with is concluded or is identifiable thereafter. an address for service in Luxembourg at the offices of Oreste Montako, a That type of contract, which may be member of the Commission's Legal assimilated to one which is concluded in Department, Jean Monnet Building, favour of a third party, implies that the Kirchberg, and by the Government of parties wish to confer an entitlement on the Italian Republic, represented by its that third party who none the less stands representative ad litem, with an address outside the contract. for service at the Italian Embassy in Luxembourg. The Commission explains that, in the present case, the parties to the contracts On hearing the report of the Judge- are the pool of insurance. undertakings Rapporteur and the views of the (as insurers) and the Union (as policy- Advocate General, the Court decided to holder). The national associations are the open ' the oral procedure without any insured persons (third parties) and hold preparatory inquiry. It further decided to the rights arising under the contract assign the case to the Third Chamber, itself, and in particular the clause pursuant to Article 95 (1) and (2) of the conferring jurisdiction contained in Rules of Procedure. Article 8 thereof.

Articles 5 and 6 thereof provide a series (b) After examining the implications of of special jurisdictions amongst which a clause conferring jurisdiction where the the plaintiff may freely choose, the contractual relationship is a normal one, Convention has, in the context of the Commission emphasizes the reper- insurance, established a system of special cussions of such a clause in cases where jurisdictions inasmuch as Articles 7 to 10 the contractual relationship involves third thereof make a whole series of possible parties. In the field of insurance, the jurisdictions available to the plaintiff, Commission explains, there may be three being the insured person. Conversely, parties: the policy-holder, the insured and in the same spirit, the range of and the beneficiary. The parties may be jurisdictions open to the plaintiff, being fused in one and the same person, or the insurer, is strictly limited (Article 11). they may take the form of two or three separate parties. Where insurance is taken out on behalf of a third person, the policy-holder is always separate from the insured (the International Road The concern to protect the insured is Transport Union and the national also reflected by the Jennard report on associations affiliated to it), which the Convention. indicates that the insured holds certain rights (in particular, the right to be paid the sum insured) without being party to the contract, in relation to which he remains a third party. The rights in The Commission stresses that the Court question may be relied upon in of Justice itself has had occasion, in proceedings brought directly against the connection with the sale of goods on insurer. The Commission takes the view instalment credit terms, to expound the that even if the third party insured does objective of protecting the weaker party, not physically sign the clause conferring which it has made into nothing less than jurisdiction (if any) which would entitle a device for interpreting the Convention him to institute proceedings before a (judgment of 21 June 1978 in Bertrand w given court, he may none the less avail O « Case 150/77 [1978] ECR 1431). The himself thereof notwithstanding the same considerations should similarly requirement of writing laid down by apply to insurance contracts, regard Article 17. being had to the fact that the Convention deals with them in the same manner as with the sale of goods on instalment credit terms. In the Commission's opinion that answer is indicated, in particular, by the purpose of Article 17 as set forth above, and by the whole set of special rules which the Finally, the Commission points out that Convention lays down for insurance although Article 17 of the Convention contracts. provides a general option to confer jurisdiction by means of an agreement between the parties, in the context of insurance such a clause cannot be valid In that connection, Article 8 of the unless the specific conditions imposed by Convention provides that an insurer Articles 12 and 15 are satisfied, and it is domiciled in a contracting State may be the concern to protect the insured which sued, either in the courts of that State, or lies behind the conditions laid down by in another contracting State in the courts Article 12. for the place where the policy-holder is

The Commission infers from that that In the first place, the Commission notes the Convention expressly contemplates that Article 17 demands an agreement in the possibility of inserting clauses writing between the parties for the conferring jurisdiction not only in favour purpose of determining a court having of the policy-holder, as party to the jurisdiction to settle any disputes which contract, but also in favour of the have arisen or which may arise in insured or the beneficiary who, by connection with a particular legal definition, are not parties thereto. relationship. Therefore, the Commission goes on to argue, if the condition concerning The Commission considers that those writing as contained in Article 17 were provisions similarly apply to contracts of to be interpreted to mean that the insurance entered into on behalf of insured or the beneficiary was required another person and that, in this case, physically to sign the clause conferring there was indeed a written agreement jurisdiction inserted in his favour before between the parties, that is to say, being able to take advantage of it, Article between the insured (the pool of 12 would be voided of its substance and insurers) and the policy-holder (the frustrated in its objectives. International Road Transport Union), and it further considers that, in the agreement, the insurer gave his consent, Indeed, unless they coincide with the in favour of the insured (namely the policy-holder, the insured and the national TIR associations), that the beneficiary, by definition, stand outside jurisdictions indicated under the Con- the relationship created by an insurance vention might be departed from should contract, and the beneficiary, inciden- the insurer be the defendant. tally, is often unknown at the time when the contract is concluded. The Commission maintains that the agreement signed by both parties affects The Commission further points out that a very specific legal relationship, namely such a thesis would void of its substance that between insurer and insured.

In the present case the Commission concludes that, even if it is not conceded In brief, the Commission proposes that that the policy-holder's signature the following answer be given to the first validates a clause conferring jurisdiction question raised by the Corte di which has been accepted by the insurer Cassazione: in favour of the insured, the insurer, having,clearly signified his consent, may not contest the application of that clause. "In the context of a contract of in- surance, a clause conferring jurisdiction (d) Fourthly, the Commission main- in favour of the insured, being a separate tains that the question raised involves the person from the policy-holder, must be problem of the principle of good faith. In regarded as valid for the purposes of that connection it argues that allowing Article 17 of the Convention if the the insurer to contest the application of a requirement of writing contained in that clause in favour of the insured when he article is fulfilled as between the insurer has duly put his signature to it and and the policy-holder." when, : ex hypotbesi, the insured has not done so, would be tantamount to endorsing the bad faith of the insurer at the outset who, at the time when the 2. Observations of the Commission on contract was made, consented to the the second question raised by the insertion of the clause in favour of the Corte di Cassazione insured, whilst knowing full well that the latter would in any event be unable to avail himself of it. The Commission notes that the Court of Justice has already had occasion to The Commission notes that it is particu- answer the question, namely in its larly important to observe the principle judgment of 22 October 1981, in Case of good faith in fields such as insfirance, 27/81 (Rohr v Ossberger [1981] ECR where protection of the weaker parties is 2431). The Court held that Article 18 of the main objective of the relevant the Convention enables the defendant provisions. who raises the objection that the Court

seised of the matter lacks jurisdiction, to He may take steps to ensure that the submit a defence on the substantive rights conferred upon him by the issues at the same time, and in the alter- contract are honoured, and may similarly native; the defendant does not thereby take advantage of the clause entitling forfeit the right to object that the him to bring the matter before a given Court is without jurisdiction. On those court of law, without the need to have grounds, the Commission proposes that signed or ratified that clause in writing the following answer be given to the before exercising the option in question. second question raised by the Corte di Cassazione: Moreover, the Italian Government notes that, since the clause has been invoked "Article 18 of the Convention must be by a third party vis-à-vis a contracting interpreted as meaning that it enables the party who has signed it, the requirements defendant not only to contest the of Article 17 of the Convention, aiming jurisdiction, but at the same time to as it does to neutralize the effect of submit, in the alternative, a defence on clauses which might slip through the substantive issues, without thereby unobserved and to validate only those forfeiting the right to raise an objection clauses which are expressly stipulated, of lack of jurisdiction." have been satisfied in the present case. Lastly, the Government of Italy notes B — Observations submitted, by . the that Article 12 of the Brussels Governmentalthe Italian Republic •Convention which refers, in the context of insurance, to the possibility of dero- gating from the provisions on jurisdiction 1. Observations on the first question in favour of a beneficiary who is not a raised by the Cone di Cassazione party to the contract makes no mention The Government of Italy claims that of any need, on- the part of that there is no doubt that, as far as national beneficiary, to sign such a derogative associations are concerned, the contract agreement. contains a stipulation on behalf of third The Italian Government therefore parties and that the International Road considers that an affirmative answer Transport Union, when contracting, did should be given to the questions raised not act as representative of the national by the court making the reference. associations.

Republic, represented by O. Fiumara and there is no contractual relationship the Commission of the European Com- between a strong party (the insurer) and munities, represented by G. Berardis, a weaker party (the insured). Thus the presented oral argument at the sitting on provisions of Article 12 et seq. of the 28 April 1983. Convention cannot weaken the scope of the requirement of writing in Article 17 since written acceptance is required of all Gerling Konzern maintained that as the parties and as consideration enables regards the first question the requirement them to claim the benefit of the clause of writing provided for in Article 17 of extending jurisdiction. the Convention must be strictly observed and that it is apparent from a consideration of the case-law of the Gerling Konzern argued that as regards Court that any clause extending the second question submitted for a pre- jurisdiction must be clearly accepted. liminary ruling, although the case-law of Thus if the beneficiary under a contract the Court regarding the interpretation of considers that the clause in derogation Article 18 of the Convention is well suits him he must accept it, even ex post established, it is possible to reconsider it facto, in writing. There is a strict logic in on the basis of the principle of the need the Brussels Convention in accordance for preliminary proceedings to make it with which all the parties to the contract possible to determine with certainty the and even beneficiaries who are not jurisdiction of the court before which the parties thereto must know precisely the matter is brought, regard being had to conditions under which a clause the substance of the case. It proposes extending jurisdiction may apply. that the question should be answered as follows: "Article 18 is an independent rule of Community law which may be That is moreover the effect of the adopted in all national types of case-law applicable in several other proceedings and accordingly requires the national legal systems. court whose jurisdiction in international law is challenged to determine its It moreover alleged that the main jurisdiction as a preliminary issue." .proceedings in the circumstances of the present case are not concerned with a problem of insurance policy so called but The Advocate General delivered his a relationship of a financial type and that opinion at the sitting on 8 June 1983.

4 The authorized national association in Italy at the material time was the Ente Autotrasporti Merci. Since it has been wound up its rights have been vested in the Italian Ministry of the Treasury pursuant to the combined provisions of Law No 1404 of 4 December 1956, Law No 413 of 18 March 1968 and Law No 1139 of 23 December 1970.

5 The national associations are affiliated to the International Road Transport Union. Each of those national associations enjoys in turn insurance cover from an international group of insurers represented by Gerling pursuant to a contract made in 1961 by the International Road Transport Union on its own behalf and on behalf of each of the national associations on the one hand and by the aforesaid international group of insurers on the other.

JUDGMENT OF 14. 7. 1983 — CASE 201/82

6 Article 8 of the contract of insurance provides : "In case of a dispute between the pool and one of the national associations the latter shall be entitled to insist on proceedings before the court having jurisdiction in the country in which it has its registered office, for the application of the law of that country."

7 Since the Italian Customs Administration claimed payment of a series of penalties, charges and duties connected with road transport under the TIR system in Italy the Ministry of the Treasury brought an action before the Tribunale di Roma [District Court, Rome] against the aforesaid group of insurers claiming payment of a total sum of LIT 812 134 310.

s During the proceedings the group of insurers brought an interlocutory action before a section of the Corte di Cassazione pursuant to Article 41 of the Italian Code of Civil Procedure for a preliminary ruling on jurisdiction. The insurers deny that the aforesaid clause conferring jurisdiction may be relied upon inasmuch as it was not signed by the Ente Autotrasporti Merci (or by the Treasury Administration) whereas Article 17 of the Convention required such a clause conferring jurisdiction to be in writing and signed by the parties.

1 1 In applying the Convention it is necessary to interpret it by reference mainly to its structure and objectives in order to make it fully effective.

12 The first paragraph of Article 17 of the Convention provides:

"If the parties, one or more of whom is domiciled in a Contracting State, have, by agreement in writing or by an oral agreement evidenced in writing, agreed that a court or the courts of a Contracting State are to have jurisdiction to settle any disputes which have arisen or which may arise in connection with a particular legal relationship, that court or those courts shall have exclusive jurisdiction."

1 3 As the Court has repeatedly held in particular in its judgments of 14 December 1976 in Case 24/76 Estasis Salotti [1976] ECR 1831 and Case 25/76 Ségoura [1976] ECR 1851 and of 6 May 1980 in Case 784/79, Porta Leasing [1980] ECR 1517, the purpose of the requirement of writing under Article 17 of the Convention is to ensure that the consent of the parties, who, by an agreement conferring jurisdiction, depart from the general rules for determining jurisdiction laid down in Articles 2, 5 and 6 of the Convention, is clearly and precisely demonstrated and is actually established.

1 4 Moreover, Article 17 of the Convention in requiring writing between the parties does not have either the object or the effect of subjecting a third party benefiting from the requirement imposed on others to the same requirement of writing where the clause conferring jurisdiction is made for his benefit and he seeks to rely on it in proceedings between him and the insurer.

i9 Consequently if the requirement as to form referred to in Article 17 were to be regarded as requiring the insured or beneficiary, not being a party to the contract but a person for whose benefit the clause conferring jurisdiction is made, expressly to sign the said clause so as to validate it and to entitle him to rely on it, the effect of such an interpretation would be to place on the latter, in view of the fact that originally the insurer has unequivocally given his consent to an open and general system of extension of jurisdiction, a

GERUNG v AMMINISTRAZIONE DEL TESORO DELLO STATO

pointless restriction amounting even, it may be, to a formality with which it would be difficult to comply if, before any proceedings, the insured has not been informed by the policy-holder of the existence of a clause conferring jurisdiction which has been made for his benefit.

20 It follows from all the foregoing that the answer should be that where in a contract of insurance a clause conferring jurisdiction is inserted for the benefit of the insured who is not a party to the contract but a person distinct from the policy-holder, it must be regarded as valid within the meaning of Article 17 of the Convention provided that, as between the insurer and the policy-holder, the condition as to writing laid down therein has been satisfied and provided that the consent of the insurer in that respect has been clearly and precisely manifested.

2. S e c o n d q u e s t i o n

21 As regards this question it is sufficient to recall that the Court in its judgments of 24 June 1981 in Case 150/80 Elefanten Schuh GmbH [1981] ECR 1671, of 22 October 1981 in Case 27/81 Rohr [1981] ECR 2431 and of 31 March 1982 in Case 25/81 CHW[1982] ECR 1189 has recognized that Article 18 of the Convention must be interpreted as meaning that it allows a defendant not merely to contest jurisdiction but at the same time to submit, in the alternative, a defence on the substance of the case without thereby losing the right to raise an objection of want of jurisdiction.

1. The first paragraph of Article 17 of the Convention of 27 September 1968 on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters must be interpreted as meaning that where a contract of insurance, entered into between an insurer and a policy- holder and stipulated by the latter to be for his benefit and to enure for the benefit of third parties to such a contract, contains a clause conferring jurisdiction relating to proceedings which might be brought by such third parties, the latter, even if they have not expressly signed the said clause, may rely upon it provided that, as between the insurer and the policy-holder, the condition as to writing laid down by Article 17 of the Convention has been satisfied and provided that the consent of the insurer in that respect has been clearly manifested.

2. Article 18 of the Convention of 27 September 1968 on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters must be interpreted as meaning that it allows a defendant not merely to contest jurisdiction but at the same time to submit, in the alter- native, a defence on the substance of the case without thereby losing the right to raise an objection of want of jurisdiction.

Everling Galmot Kakouris

Delivered in open court in Luxembourg on 14 July 1983.

For the Registrar H. A. Rühi U. Everling Principal Administrator President of the Third Chamber