C-106/95

More specifically, the national court wishes to establish whether an 'abstract' agreement on the place of performance — that is to say, an agreement concluded, not to establish the place at which the person liable actually has to perform his obligations, but simply and exclusively to designate the courts having jurisdiction — is valid under Article 5(1) of the Convention and hence whether the courts for the place of performance thus What is at issue in these proceedings is the identified have jurisdiction to rule on dis- sum of DM 197 284, namely the difference putes relating to the obligation in question. between the amount paid by the defendant's If that question is answered in the negative, insurers and the amount claimed by MSG. the Court is asked whether in this case the With a view to obtaining that sum, MSG 'abstract' agreement fulfils the requirements of Article 17 of the Convention, that is to say, whether a jurisdiction clause has been validly concluded. 1 — In this connection, it should be observed that it appears from the order for reference that the places of unloading were located solely in France and that, apart from some negligible exceptions, the places of loading were also in France. That statement has, however, been contested by MSG at the hear- ing, where it maintained that the places of loading were * Original language: Italian. located chiefly in Germany.

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After finding that all the — principal and ancillary — contractual obligations could be By interlocutory judgment, the Schiffahrts- performed only in France, the Bundesgerich- gericht declared the application admissible. tshof therefore concluded that the determi- O n appeal, the Oberlandesgericht (Higher nation of the place of performance was Regional Court) Nürnberg upheld the defen- fictitious and that 'the reference in [the dant's claim that it could be sued only in the plaintiff's] general conditions of business to French courts, and dismissed the application Würzburg as the place of performance was as inadmissible for want of jurisdiction. intended solely to enable legal disputes to be brought before the courts of the place at which its principal place of business was located'. The decision had therefore been taken solely in order to give jurisdiction to the plaintiff's courts and hence to avoid com- plying with the formal requirements imposed by Article 17 of the Brussels Con- 4. The plaintiff appealed on a point of law vention. Nevertheless, as the Bundesgericht- against that judgment to the Bundesgericht- shof points out, under German law 'an effec- shof, in which it claims that the judgment of tive agreement on the place of performance the court of first instance should be upheld. was made'.

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5. In view of those circumstances, the consensus with regard to the con- Bundesgerichtshof deemed it necessary to tent of the letter of confirmation? refer the following questions to the Court in order to resolve the dispute pending before it:

2) In the event that the Court of Justice should answer question 1 in the nega- 6. What therefore has to be established in tive: the first place is whether an abstract agree- ment on the place of performance — which simply conceals a jurisdiction clause, which, as such, would be subject to formal require- ments — is to be considered valid under Article 5(1). If that question is answered in (a) Can an agreement conferring juris- the negative, it has to be determined whether diction in international trade or in the case in point the agreement on the commerce in accordance with the place of performance may be regarded as a third hypothesis mentioned in the validly concluded jurisdiction clause under second sentence of the first para- Article 17. graph of Article 17 of the 1978 ver- sion of the Brussels Convention also be concluded by one party's not contradicting a commercial letter of confirmation containing a pre- printed reference to the courts of The Commission has suggested reversing the the consignors' place of business order of the preliminary questions on the having sole jurisdiction or must ground that, if only on logical grounds, it there have been in every case prior should be determined whether there is a

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8. Article 5(1) of the Convention, which is 7. For my part, I consider that the order of the subject of the national court's first ques- the questions as they have been put by the tion, provides that 'a person domiciled in a national court should be respected. Over and Contracting State may, in another Contract- above the different (or allegedly different) ing State, be sued: in matters relating to a degree of difficulty of the two questions — a contract, in the courts for the place of per- criterion which, to my mind, cannot or formance of the obligation in question; ...'. should not influence the Court's decision — I consider that the Bundesgerichtshofs decision to place the question on the inter- pretation of Article 5(1) first is anything but a matter of chance. Whilst an affirmative answer to that question would mean that the German courts certainly have jurisdiction, it is possible that the Court's answer with Next, it should be observed that Article 5(1), regard to Article 17 may require further which appears in Section 2, 'Special jurisdic- findings of fact on the part of the national tion', provides for an exception to the gen- court in order to establish which courts have eral rule contained in Article 2 that the jurisdiction, which it is not competent to the courts having jurisdiction should be those of Bundesgerichtshof to make. Consequently, the State in which the defendant is domi- should the Court decide to answer the sec- ciled. This derogation in favour of the place ond question only, this might make a second of performance of the obligation in question reference to the Court necessary with regard is justified, as the Jenard Report points out, to the same dispute. by the fact that there is 'a close connecting

The jurisdictional criterion set out in Article 5(1), however, is not, or at least not directly, 11. Having said this, the place of perfor- the 'proximity' of the courts to the dispute, mance may also be determined contractually but the place of 'performance of the obliga- as between the parties. This may be inferred tion in question'. 4

5 — The case-law has in fact determined, with regard to that type of contract, that the place of performance should be deter- 2 — OJ 1979 C 59, p. 1, in particular at p. 22. mined, not in accordance with the lex causae, but indepen- 3 — Case 12/76 Tessili v Dunlop [1976] ECR 1473, paragraph 13. dently on the basis of the obligation characteristic of the contract (see, in particular, Case 133/81 Ivenel v Schwab 4 — But, as the Court itself has stressed, it is precisely that place [1982] ECR 1981). That case-law has since been expressly which 'usually constitutes the closest connecting factor enshrined in Article 5(1) of the Brussels Convention, as between the dispute and the court having jurisdiction over it, amended by the 1989 Accession Convention. and it is this connecting factor which explains why, in con- tractual matters, it is the court of the place of performance of 6 — Case 14/76 De Bloos v Bouyer [1976] ECR 1497, paragraph the obligation which has jurisdiction' (Case 266/85 Shenavai 13. v Kreisler [1987] ECR 239, paragraph 18). 7 — Tessili v Dunlop, cited in footnote 3, paragraph 13.

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9 — See the Opinion of Advocate General Capotorti in Zeiger v 8 — Case 56/79 Zeiger v Salinitri [1980] ECR 89. Salinitri [1980] ECR 98, in particular at 101 et seq.

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10 — In particular, the Court stressed that, whilst Article 17 has a purely procedural function, Article 5(1) has an essentially substantive function, which is accompanied only indirectly by a procedural effect, an effect which is however indepen- 11 — Case C-288/92 Custom Made Commercial [1994] ECR dent of the parties' intention. 1-2913, paragraphs 14 to 21.

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within the system of the Brussels Conven- performance would have to be recognized as tion. being valid invariably and in any event.

Sec- from any laid down by national law itself, ondly, it seems to me that, in view of the ref- either as a result of the imposition of formal erence which it makes to the direct connec- requirements or as a result of case-law refer- tion between the dispute and the court called ring to institutions such as fraud on a stat- upon to decide it, Zeiger v Salinàri should ute. 12 Otherwise, agreements on the place of instead be interpreted as meaning that the parties may indeed decide to locate the per- formance of the contract at a place other 12 — Thus, for example, the Cour d'Appel (Court of Appeal), than the one which would be fixed by the Liège, by judgment of 12 May 1977 (Journal de Tribunaux law, but that place must at all events be the 1977, p. 710) denied validity to an agreement on the place of performance on the ground that it was contrary to the actual place of performance: only then are geographical reality of the contract. That judgment was the parties not obliged to comply with the subsequently upheld by the Cour de Cassation (Court of Cassation) (judgment of 28 June 1979, Journal des Tri- formal requirements set out in Article 17. bunaux 1979, p. 625, with a note by Vander Elst in Revue critique de jurisprudence beige, 1981, p. 347 et seq.), which Lastly, for present purposes I consider that referred to the fraudulent nature of the agreement in ques-

The judgment of 27 February 1996 of the French Cour de Cassation (Europe, What was at issue in Custom Made Corn- April 1996, N o 171, p. 23) which held that an agreement on the place of performance was invalid on the ground that, first, the obligation in question could be performed only in France and, secondly, that under Article 5(1) of the Brussels Convention the only obligation to be taken into account is that which actually underlies the court proceedings, war- 13 — Custom Made Commercial, cited in footnote 11, paragraph rants a separate mention. 21.

It is only too obvious from this point of In the final analysis, here the question is that view that Article 5(1) may not be interpreted of establishing whether, where the contrac- in such a way as to enable the outcome to be tual obligation cannot in fact be performed brought about which, through the imposi- in the place agreed as the place of perfor- tion of rigid formal requirements, Article 17 mance either because that place is at odds set out to avoid. 15 The question would arise with the very nature of the contract or because it is not consistent with geographical fact, Article 5(1) nevertheless remains a valid 15 — In fact, even those commentators who approve of Zeiger v jurisdictional criterion. Salinitri are in favour of laying down uniform formal requirements both for jurisdiction clauses and for 'abstract' agreements on the place of performance. See Kropholler. 'Europäisches Zivilprozeßrecht', 1996; Gaudemet-Tallon: Les Conventions de Bruxelles et Lugano, Paris, 1993, p. 121; Kaye: Civil Jurisdiction and Enforcement of Foreign Judg- 14 — In other words, whilst it is true that the jurisdiction of the ments, Abingdon, 1987, p. 524; Lasok, Stone: Conflict of courts for the place of performance is justified by the direct, Laws in the European Community, Abingdon, 1987, p. 219; objective link which normally exists between the relation- Desantes Real: La Competencia Judicial en la Comunidad ship at issue and the court seised, the criterion used in Europea, Barcelona, 1986, p. 258 et seq.; Calvo-Caravaca: Article 5 (place of performance of the obligation in ques- Comentario al Convenio de Bruselas, Madrid, 1994, p. 90 et tion) may lead to different results, which should otherwise seq. For the contrary view, see Geimer: Internationales be disregarded. Prozeßrecht, 1993, paragraph 1491.

as to how making use of that state of affairs Neither does the argument that such an could be regarded as correct having regard to approach would lead parties no longer to Article 5(1) and consistent with the system stipulate clauses on the place of performance, and aims of the Convention as a whole and which would end up by devoiding Article in particular with regard to Article 17. 5(1) of its substance, seem to me to have any particular importance. I would merely observe in this connection that the place of performance certainly is not destined to dis- appear simply because agreements on the place of performance in certain circum- stances do not have the effect of conferring jurisdiction: the plaintiff may still sue in the courts for the place of performance of the 18. Although it recognizes that a fictitious obligation in question under the law. determination of the place of performance may be a means of circumventing the formal requirements laid down by Article 17, the Commission nevertheless considers that this is permitted by the Convention itself. It sim- ply points out in this connection that Article 5(1) does not require the parties to indicate the actual place of performance of the con- tractual obligations. 19. In the final analysis, I consider it absurd even only to conjecture that the Convention might be interpreted in such a way as to enable Article 17 to be circumvented, bearing in mind moreover the importance of Article 17 within the system of the Convention. In view of this, I am unable to agree with the Commission's proposition that this is the price to be paid in order for there to be legal certainty and foreseeability of the courts That argument goes too far. In fact, the only having jurisdiction. In point of fact, those criterion which can be inferred from the pro- objectives are certainly not aims in them- vision in question, which however contains selves; for example, making the application no indication as to how the place of perfor- of the rules on jurisdiction foreseeable means mance may be determined contractually, is first and foremost reinforcing the legal pro- that the place must be the place of perfor- tection available to persons established in the mance of the obligation in question. Now, it Community by allowing the plaintiff easily seems reasonable to me to consider that that to identify the court before which he may criterion, far from enabling any place in the bring an action and the defendant reasonably world to be chosen, requires there to be a to foresee the court before which he may be connection with the place at which the obli- sued. 16 I am unable to see, moreover, in gation in question actually has been or what way legal certainty might be strength- should be performed. In brief, even if the ened by a breach of Article 17. place is different from that fixed under the law, it must still be a place which is con- nected with, or at least appropriate to, the subject-matter of the contract. 16 — Case 125/92 Mulox [1993] ECR I-4075, paragraph 11.

17 — This solution is advocated by both Jayme: 'The Role of 21. By this question, which is asked in the Article 5 in the Scheme of the Convention. Jurisdiction in Matters Relating to Contract', in Civil Jurisdiction and event that the Court should consider, as I Judgments in Europe. Proceedings of the Colloquium on the have suggested it should, that agreements on Interpretation of the Brussels Convention by the Court of Justice considered in the context of the European Judicial the place of performance having the sole aim Area, Luxembourg, 11 and 12 March 1991, London, 1993, p. 73 et seq. and Huet: 'Note sous l'arrêt de la Cour Zei- of formally designating the court having ger', in Journal du droit international, 1980, p. 435 et seq. jurisdiction as a court other than that for the Both of them suggest that the place of performance should be determined independently, which, without requiring actual place of performance are unlawful, the compliance with the formal requirements set out in Article 17, would nevertheless require consensus on the part of the Bundesgerichtshof seeks to establish whether parties to be proven. in such case it may considered that there is a 18 — In this regard, I consider that there is some point in stress- ing that the absence of an independent concept of the place jurisdiction clause under Article 17 of the of performance, which would certainly be desirable, cannot Convention. More specifically, the question be regarded as not permitting the Community Court to lay down limits designed to prevent Article 5 being used as an is whether, in international trade or com- alternative to Article 17. Whilst it is in fact true that deter- mination of the place of performance has been left to the merce, a jurisdiction clause can be regarded substantive law, it is also true, as the Court has explained as having been validly concluded even on several occasions, that the choice between an indepen- dent interpretation and referring to the rules of conflict of through one party's lack of response to a laws is made pragmatically in that 'the appropriate choice can only be made in respect of each of the provisions of the commercial· letter of confirmation [question Convention to ensure that it is fully effective having regard 2(a)] or through that party's having paid to the objectives of Article 220 of the Treaty' (Tessili v Dunlop, cited in footnote 3, paragraph 11). Fixing Commu- without objection invoices referring to the nity limits must be regarded as being all the more necessary in present circumstances where it is a question of securing courts having jurisdiction [question 2(b)], or full harmony and functionality for two provisions, one of which, Article 17, has to date been interpreted indepen- whether there should in every case have been dently. prior consensus between the parties and that

Thus, for example, the Court denied any validity to a jurisdiction clause set out on the reverse of a letter of confirmation delivered by the seller to the purchaser after the con- clusion of an oral agreement on the ground that it did not comply with the formal 22. The Court has not yet had occasion to requirements laid down by Article 17, 21 rule on the interpretation of that provi- which is a very similar case to the one at sion. 19 Before I even proceed to consider the issue in these proceedings. Even in those cir- aims and innovations introduced by that cumstances the Court held that there was a provision and draw conclusions with regard need for written confirmation on the part of to the case before the Court, I consider it offeree, the only attenuation consisting in the nevertheless appropriate to call to mind the possibility of departing from the require- interpretation which the Court gave to the ment for writing in the case of a continuing version of Article 17 which was in force trading relationship. 22 before the amendment under discussion, naturally in so far as that interpretation is relevant to the present case. 20 — Case 24/76 Estasis Salotti [1976] ECR 1831, paragraph 7, and Case 25/76 Segoura [1976] ECR 1851, paragraph 6. 21 — Segoura, cited in the preceding footnote. 22 — This possibility was expressly added to Article 17 by the 1989 Accession Convention. The new version of Article 17 19 — See, however, the detailed Opinion of Advocate General provides that a clause conferring jurisdiction can be validly Lenz in Case C-288/92 Custom Made Commercial [1994] concluded also 'in a form which accords with practices ECR I-2915, in particular at 1-2934 et seq. which the parties have established between themselves'.

23. The new version of Article 17 seems to 24. Whilst those were the considerations have been drawn up precisely because of the which prompted the amendment of Article excessive formalism of such an approach in 17, the fact remains, as the Schlosser Report regard to international trade. Indeed, it is itself emphasizes, that 'This is however, as stated in the Schlosser Report 23 that the should be clearly emphasized, only a relax- Court's interpretation of Article 17 'does not ation of the formal requirements.

International trade is heavily In the final analysis, the intention behind dependent on standard conditions which that amendment would seem to have been to incorporate jurisdiction clauses.' attenuate only the formal requirements laid down by Article 17 in order to bring them into line with the requirements of interna- tional trade, yet without losing sight of the aim of actual consensus. The conflict between those two requirements — or in any event the difficulty in reconciling them — is only too obvious. The way in which consen- sus is manifested, according to the Court's interpretation, is closely connected with proving actual consensus between the par- ties. 25 Whilst it is therefore true — and how

one of the parties. . footnote 20]. 26 — See, for example, Kohler: 'Rigueur et souplesse en droit international privé: les formes prescrites pour une conven- tion attributive de juridiction "dans le commerce interna- tional" par l'article 17 de la convention de Bruxelles dans sa nouvelle rédaction', in Diritto del Commercio Internazion- 23 — OJ 1979 C 59, p. 71, point 179. ale, 1990, p. 611 et seq.

25. O n top of this, it is extremely difficult to sonably imputable knowledge of customary establish that there are trade or commercial practices in international trade or commerce. practices with regard only to formal require- To my mind, this is the criterion which ments — these being procedural rules which should guide the interpretation of the provi- are liable to be changed by the States at any sion in question. 28 time 2 7 — and doing so would therefore devoid the new version of Article 17, as amended by the 1978 Accession Convention, of any meaning. It must therefore be held that the amendment entails not only a relax- ation of the ways in which consensus is manifested, but also, for that very reason, less strictness with regard to the formation 26. Given all these considerations, when and of the parties' consensus with regard to des- in what way may it be considered that there ignating the court having jurisdiction. In is a trade or commercial practice with regard other words, actual consensus, which was to manners of achieving consensus of which initially essential and guaranteed only by the parties are or ought to have been aware? writing or evidence in writing of an oral agreement, now yields in international trade to a presumption of actual consensus.

It be conferred on jurisdiction clauses based follows that the interpretation of the provi- sion in question must necessarily and rigor- ously be strict. Furthermore, the interpreta- tion cannot in any event be such as to cause 28 — Moreover, the concept of presumptive knowledge in the sense of reasonably imputable knowledge is not unknown the objective of 'actual' consent to be lost in the Court's case-law. I refer to Case C-214/92 Powell sight of, if only through awareness or rea- Duffryn [1992] ECR 1-1745, in which the Court held with regard to a clause conferring jurisdiction contained in the statutes of a company that 'irrespective of how shares are acquired, every person who becomes a shareholder knows, or ought to know, that he is bound by the company's stat- utes' (paragraph 27; my emphasis). 27 — See Mezger: Travaux du comité français de droit interna- 29 — See to this effect Rauscher: Zeitschrift für Zivilprozeß 104, tional privé, 1980-1981, p. 15 et seq. 1991, p. 272, especially at p. 292 et seq.

This interpretation is moreover confirmed by the 1988 Lugano Convention 32 and the Brussels Convention as amended by the 1989 San Sebastian Convention. 33 Apart from the requirements set out in the 1978 version, 27. Consequently, it is appropriate, also with Article 17 of the Lugano and San Sebastian regard to the third hypothesis provided for Conventions requires the trade or commer- in Article 17, that the Court itself should cial usage in question to be 'widely known indicate the objective evidence and/or con- to, and regularly observed by, parties to con- clusive conduct from which it can be tracts of the type involved in the particular inferred that one is in the presence of a trade trade or commerce concerned'. 34 Accord- or commercial practice which may appropri- ingly, it is not enough for a jurisdiction ately be 'utilized' for the purposes of the clause to have been concluded in a form valid conclusion of a jurisdiction clause. Seen which accords with a usage in the particular from that perspective and bearing in mind trade or commerce concerned of which the the importance of consensus on the part of parties were or ought to have been aware; the parties concerned, the concept of trade or the usage must have been 'on the one hand, commercial practices for the purposes and widely known in international trade or com- effects of Article 17 can only be based, as merce, and, on the other, regularly observed Advocate General Lenz has suggested, on by parties to contracts of the type involved the existence of 'a practice ... which is fol- in the particular trade or commerce con- lowed generally, continuously and regularly cerned'. 35 by the circles concerned in transactions which correspond, both objectively and in point of their localization, to the transaction at issue'. 30 In brief, the practice must be 31 — See to this effect, among others, Kaye: Civil Jurisdiction and Enforcement of Foreign Judgments, Abingdon, 1987, such as to lead to the conviction that the par- p. 1062 et seq.; Huet, Note, in Clunet, 1990, p. 153 et seq.; Stöwe: Gerichtsstandsvereinbarungen nach Handelsge- ties' conduct is conclusive, that is to say that brauch, 1993, p. 56 et seq. it implies a meeting of the minds and hence 32 — OJ 1988 L 319, p. 1. actual consensus as regards the conferment 33 — OJ 1989 L 285, p. 4. 34 — These additional requirements were in fact taken over from of jurisdiction. From that perspective, the Article 9(2) of the 1980 Vienna Convention on Contracts existence of a specific trade or commercial for the International Sale of Goods. 35 — It is worth mentioning in this connection that the amend- ment arose precisely because of the concern expressed by the EFTA countries in the course of the adoption of the Lugano Convention that one party's lack of response to a commercial letter of confirmation might be deemed to be 30 — Opinion in Custom Made Commercial, cited in foot- acceptance. See the Jenard and Möller Report, OJ note 19, in particular at 1-2939. C 189 1990, points 55 to 59.

29. Let us return to the case before the Court. Since the contract in question was a 30. I therefore cannot accept the proposition charterparty concluded between traders in put forward by the plaintiff and the German the relevant sector, there is no doubt that we Government in the proceedings to the effect are in the realm of international trade or that, under Article 17, lack of response to a commerce and hence within the field of commercial letter of confirmation is to be application of the provision in question. I deemed to constitute tacit acquiescence, irre- would go on to point out once again that the spective as to whether any inquiry has been national court asks whether one party's lack made whether there exists a practice to that

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effect in the relevant trade or commerce. 36 Silence or inactivity does not in itself amount That proposition, which relies, on the one to acceptance.' 38 hand, of the existence of a presumed, gener- alized — that is to say, Europe-wide — prac- tice and, on the other, on the fact that the amendment made by the 1978 Accession Convention was adopted precisely in order to avoid the excessive formalism of the case- law with regard to cases of this type, 37 is in fact without any foundation. 31. In the final analysis, in order to establish whether the silence of one party in relation to a commercial letter of confirmation con- stitutes a manner of acceptance and hence means that a jurisdiction clause has validly been concluded, it is necessary to prove the existence of such a usage on the basis of the criteria set out above.

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acceptance of the jurisdiction clause. In the 32. The solution just put forward can also be event that it is found that there is such a applied in order to determine whether there usage, it will then have to be established was a presumed trade or commercial usage whether the party against whom the jurisdic- consisting in the fact that the defendant paid tion clause is relied was or ought to have without any objection the invoices issued by been aware of the existence of such a usage. MSG, all of which contained a statement to Whether such reasonably imputable knowl- the effect that the place at which MSG had edge existed of the usage in question will its principal place of business was the com- depend, in turn, on the importance of that petent forum. It will therefore be necessary usage in the country in which the party to show also with regard to this hypothesis against which the clause is relied is habitually that, on the basis of the same criteria listed resident and on whether or not this was the above, there was a commercial usage of first contract concluded with that party and/ which the parties were or ought to have been or in that sector. aware.

33. In the light of the foregoing considerations, I therefore p r o p o s e that the C o u r t should answer the B u n d e s g e r i c h t s h o f s questions as follows:

(1) Article 5(1) of t h e Brussels C o n v e n t i o n of 27 S e p t e m b e r 1968 m u s t b e inter- p r e t e d as p r e c l u d i n g jurisdiction being vested in t h e c o u r t s for t h e place of p e r f o r m a n c e of a contractual obligation w h e r e t h a t place, d e t e r m i n e d c o n t r a c - tually b y t h e parties, has n o substantial c o n n e c t i o n w i t h t h e subject-matter of t h e c o n t r a c t and it appears t h a t t h a t d e t e r m i n a t i o n w a s m a d e w i t h t h e sole aim of designating t h e c o u r t s having jurisdiction w i t h o u t c o m p l y i n g w i t h t h e for- mal r e q u i r e m e n t s laid d o w n b y Article 17 of t h e C o n v e n t i o n .