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Studies on Maritime Affairs 19

Jurisdiction and Arbitration Clauses in Documents

A Comparative Analysis

Bearbeitet von Felix Sparka

1. Auflage 2010. Taschenbuch. xviii, 282 S. Paperback ISBN 978 3 642 10221 9 Format (B x L): 15,5 x 23,5 cm Gewicht: 460 g

Recht > Handelsrecht, Wirtschaftsrecht > Europäisches, internationales Wirtschaftsrecht Zu Inhaltsverzeichnis

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The legal framework for choice of forum clauses in maritime transport documents is relatively complex and deserves particular attention. They may be affected by international conventions, admiralty , , ordinary law and specific . Moreover, and arbitration agreements are situated at an intersection of procedural and substantive law. Besides the “hori- zontal” conflict of , which is always an issue in international , there is a “vertical” created by federal systems which needs to be addressed. This may be self-evident regarding the law of the , but the ongoing European integration and the growing importance and extent of EU legislation has led to similar structures within the . The following paragraphs will shed some light on these various issues, by describing the applicable laws, clarifying their relation and their scope.

A. The legal framework for jurisdiction clauses in maritime transport documents A. The legal framework for jurisdiction clauses I. The U.S. framework for jurisdiction clauses

1. Relation between federal and state law in maritime matters The U.S. lays down that the judicial power of the United States shall extend to all cases of admiralty and maritime jurisdiction.101 This provision not only confers the power to adjudicate admiralty matters to federal , but also empowers the Congress to pass legislation on matters of maritime jurisdiction, including admiralty. The purpose of this provision is the establishment of uniform rules in order to relieve maritime commerce from the disadvantages of divergent legislation.102 Admiralty jurisdiction extends to all contracts which require a

101 U.S. Const. Art. 3, § 2, cl. 1. 102 Knickerbocker Ice Co. v. Stewart, 253 U.S. 149, 164 (1920).

F. . Sparka, Jurisdiction and Arbitration Clauses in Maritime Transport Documents: 19 A Comparative Analysis, Hamburg Studies on Maritime Affairs 19, DOI 10.1007/978-3-642-10222-6_2, © Springer-Verlag Berlin Heidelberg 2010 20 Chapter 2: The Legal Framework substantial carriage of goods by sea,103 thus including most multimodal contracts. In addition, governs contracts to carry by sea.104 There are four sources of U.S. admiralty law: the general maritime law, inter- national agreements, federal law and state law.105 The two main sources of U.S. admiralty law are federal and general maritime law. General maritime law is based on a body of law, which has its origins in the continuing maritime tradi- tion of the nations and which has been adopted by the Constitution to be drawn on and to be further expanded by the federal courts.106 As such, general maritime law constitutes a form of federal .107 State law is another source of U.S. admiralty law. The application of state law in maritime cases has been described as “one of the most perplexing issues in the law.”108 Since general maritime law is not a comprehensive system, state law may supplement it in instances where it does not conflict with any established rule of general maritime law and where the application of state law does not violate the principle of national uniformity.109 In certain cases, labeled “maritime and local,” a balancing of interests takes place.110 In these cases state law may be applied, if local and state interests dominate and uniformity is not essential.111 Nonetheless, state statutes may not contravene an applicable or the essential purpose of such an act; and even the absence of any federal law, including general maritime law, by itself may preempt state law.112 The same rule applies to actions under the “saving to suitors” clause,113 accord- ing to which all plaintiffs have the right to a common law remedy where the common law is competent to give it.114 This means that where a plaintiff brings a suit in personam he can choose between commencing an admiralty action in a federal or an ordinary civil action either in a state court or in a federal

103 Norfolk Southern Railway Co. v. Kirby, 543 U.S. 14, 25-29 (2004). 104 See e.g. Carnival Cruise Lines, Inc. v. Shute, 499 U.S. 585, 590 (1991). 105 Scoles/Hay/Borchers/Symeonides, Conflict of Laws 157 (2004). 106 R.M.S. Titanic, Inc. v. Haver, 171 F.3d 943, 960 (4th Cir.1999). 107 Currie, Federalism and the Admiralty: “The Devil’s Own Mess”, 1960 Sup. Ct. Rev. 158, 159. Even though there is no general , Erie Railroad Co. v. Tompkins, 304 U.S. 64, 78 (1938), in some areas federal common law exists. One of those areas is maritime law, Pope & Talbot v. Hawn, 346 U.S. 406, 411 (1953). The existence of federal common law in admiralty cases was again confirmed in Texas Industries, Inc. v. Radcliff Materials, Inc., 451 U.S. 630, 641 (1981). 108 1 Schoenbaum, Admiralty and Maritime Law 161 (2004); see also Force, Deconstruct- ing Jensen: Admiralty and Federalism in the Twenty-First Century, 32 J. Mar. L. & Com. 517, 526 (2001). For the changing history of state law in maritime cases, see Currie, Federalism and the Admiralty: “The Devil’s Own Mess”, 1960 Sup. Ct. Rev. 158, 165-180. 109 Southern Pacific Co. v. Jensen, 244 U.S. 205, 216 (1917). 110 Kossick v. United Fruit Co., 365 U.S. 731, 738-739 (1961). 111 For a more detailed analysis of the relation of general maritime law and state law, see 1 Schoenbaum, Admiralty and Maritime Law 161-167 (2004). 112 Southern Pacific Co. v. Jensen, 244 U.S. 205, 216-217 (1917). 113 28 U.S.C. § 1333 (1). 114 Leon v. Galceran, 78 U.S. 185, 191 (1870).

A. The legal framework for jurisdiction clauses 21 court.115 The term “common law remedy” does not imply the application of state law. Instead, the courts must apply the same substantive law as in admiralty actions – federal admiralty law.116 Nevertheless, there is one significant inroad for state law into the of maritime claims. Just as federal courts apply federal procedural law, state courts apply state procedural law, except where preempted by federal law, regardless of whether the claim is based on state or federal substantive law.117 If jurisdiction clauses were perceived to be solely a matter of procedural law, a strictly formal approach would generally lead to the application of state law in actions in state court. However, regardless of the classification of jurisdiction agreements,118 it has been held that federal preemption in admiralty matters requires the enforcement of jurisdiction agreements according to federal law,119 not only in federal courts under admiralty jurisdiction, but also in state courts120 and in federal courts sitting in diversity121 where actions are brought under the “saving to suitors” clause. Consequently, state law plays only a small role in the enforcement of jurisdiction clauses in maritime transport documents.

2. Essential laws and some questions on their application Under the , a comprehensive code for the transportation of goods by sea does not exist. As was described above, U.S. admiralty law is based on diverse statutes on individual subjects, on general maritime law and to some extent on state law. Despite the variety of the sources, maritime law is relatively uniform and forms a single body of law.122

115 See Offshore Logistics, Inc. v. Tallentire, 477 U.S. 207, 222 (1986); 1 Schoenbaum, Admiralty and Maritime Law 172-173 (2004). Federal admiralty jurisdiction is exclu- sive only with respect to certain issues. These are in rem proceedings, Madruga v. Superior Court of Cal. in and for San Diego County, 346 U.S. 556, 560-561 (1954); and instances where statutes bestow exclusive jurisdiction on federal courts, 1 Schoenbaum, Admiralty and Maritime Law 173-174 (2004). 116 Offshore Logistics, Inc. v. Tallentire, 477 U.S. 207, 222-223 (1986). 117 Friedenthal/Kane/Miller, 249 (2005); Hay, Law of the United States 51-52 (2005); see also American Dredging Co. v. Miller, 510 U.S. 443, 460 (1994) (Stevens, J. concurring) (with respect to saving clause and Jones Act cases). 118 See below, Chapter 5 A. I. 119 Carnival Cruise Lines, Inc. v. Shute, 499 U.S. 585, 590 (1991) (involving a jurisdiction agreement in cruise line’s passage contract ticket); see also Born/Rutledge, Interna- tional Civil Litigation in United States Courts 502 (2007). 120 Fisk v. Royal Caribbean Cruises, Ltd., 108 P.3d 990, 992-994 (Idaho 2005); see also Hodes v. S.N.C. Achille Lauro, 858 F.2d 905, 909 (3rd Cir. 1988) (obiter dictum). 121 Hodes v. S.N.C. Achille Lauro, 858 F.2d 905, 909 (3rd Cir. 1988); Lurie v. Norwegian Cruise Lines, Ltd., 305 F. Supp.2d 352, 356-357 (S.D.N.Y. 2004). 122 Force, An Essay on Federal Common Law and Admiralty, 43 St. Louis U. L.J. 1368, 1376 (1999).

22 Chapter 2: The Legal Framework

Only a few statutes at the state level directly address jurisdiction clauses,123 and federal law preempts the application of these rules in admiralty cases.124 However, there are some statutes of maritime or procedural origin which may affect juris- diction clauses. The paramount in the field of maritime transport is the Carriage of Goods by Sea Act (COGSA),125 which brought the into effect. COGSA is supplemented by the Harter Act.126 Both acts set forth manda- tory liability standards and limitations for bills of lading, including nonnegotiable bills of lading.127 As a result of the enactment of COGSA, the application of the Harter Act has been limited to domestic trade and to foreign trade up to the point where the goods are loaded on board and for the time between discharge from the vessel and delivery.128 The coverage of COGSA is often contractually extended to these periods and to inland portions of a multimodal transport contract.129 Accord- ingly, COGSA governs almost all shipping operations, particularly as it applies to outbound as well as to inbound traffic.130 Another federal statute with a potential effect on jurisdiction clauses in maritime transport documents is the Federal Bills of Lading Act, which contains rules on the transfer of bills of lading and on the rights of and endorsees.131 By contrast, the rules of judicial procedure do not affect the validity of juris- diction clauses since they only regulate what relief a claimant may seek when attempting to enforce a jurisdiction clause, in particular whether transfer, dismissal

123 Montana Code Ann. § 28-2-708 (1985); Idaho Code § 29-110 (2003). Under law, jurisdiction agreements are mandatorily enforced if non-residents submit to New York jurisdiction and the transaction involves not less than $ 1 million, N.Y. Gen. Oblig. Law § 5-1402 (1984). The doctrine of is not applicable to actions where this section applies, N.Y. C.L.P.R. Rule 327 (b). 124 See above, Chapter 2 A. I. 1. 125 46 U.S.C. § 30701 note. Before it was transferred in 2006, COGSA was found in 46 U.S.C. App. §§ 1300-1315 (1936). A similar statute governs contracts of passage, 46 U.S.C. § 30509. The U.S. is not a party to any of the conventions on the carriage of passengers, see 1 Schoenbaum, Admiralty and Maritime Law 196 (2004); Tetley, Maritime Transportation, in Herber (ed.), XII International Encyclopedia of Compara- tive Law ¶ 4-357 (2001). 126 46 U.S.C. §§ 30701-30707 (2006), by which the Harter Act in its previous form, 46 U.S.C. App. §§ 190-196 (1893), was repealed. However, changes were only made to clarify the law and it was not intended to alter the previous law in substance, H.R. Rep. No. 109-170 at 48 (2005). 127 Under U.S. law, nonnegotiable bills of lading include sea , see below, Chapter 3 B. I. The Harter Act applies to bills of lading and to other shipping documents any- way, compare 46 U.S.C. §§ 30702-30705. 128 1 Force/Yiannopoulos/Davies, Admiralty and Maritime Law 20 (2008); Tetley, Marine Claims 62-63 (2008). 129 See Norfolk Southern Railway Co. v. Kirby, 543 U.S. 14, 28-29 (2004). 130 COGSA (preamble). The disregard of the potentially closer connection to the country of shipment has been considered “unfortunate and chauvinistic,” Tetley, Marine Cargo Claims 39 (2008). 131 So-called Pomerene Act, 49 U.S.C. §§ 80101-80116 (1994).

A. The legal framework for jurisdiction clauses 23 or stay of the action is appropriate.132 One exception may be the federal change of venue section which will be considered below.133 In admiralty cases, federal law governs conflict of laws issues.134 Rulings on the application of conflict of laws principles to jurisdiction agreements, however, are divergent, and commentators disagree on the current state of the prevailing .135 While in some cases U.S. courts simply apply lex fori, sometimes even when the contract contains a choice of law clause,136 there are also examples of the enforcement of jurisdiction agreements in accordance with the governing law,137 which most commentators regard as the preferable solution.138 This also

132 In the case of a valid foreign forum jurisdiction clause dismissal is generally appropri- ate, Polar Shipping Ltd. v. Oriental Shipping Corp., 680 F.2d 627, 631 (9th Cir. 1982). Generally there appears to be some uncertainty concerning the remedy or which is appropriate in certain situations, see Mullenix, Another Choice of Forum, Another Choice of Law: Consensual Adjudicatory Procedure in Federal Court, 57 Fordham L.Rev. 291, 327-329 (1988). 133 28 U.S.C. § 1404 (a). See below, Chapter 7 A. I. 2. 134 1 Schoenbaum, Admiralty and Maritime Law 265-268 (2004). 135 It has been argued that most courts asses the validity of jurisdiction agreements according to the law governing the contract, Gruson, Forum-Selection Clauses in International and Interstate Commercial Agreements, 1982 U. Ill. L. Rev. 133, 156 (reviewing diversity cases). Another commentator observed that U.S. courts “reflex- ively apply lex fori,” Yackee, Choice of Law Considerations in the Validity & Enforcement of International Forum Selection Agreements: Whose Law Applies?, 9 UCLA J. Int’l L. & Foreign Aff. 43, 67 (2004) (regarding international jurisdiction agreements); compare also Peel, Exclusive jurisdiction agreements: purity and prag- matism in the conflict of laws, [1998] LMCLQ 182, 217; Mullenix, Another Choice of Forum, Another Choice of Law: Consensual Adjudicatory Procedure in Federal Court, 57 Fordham L.Rev. 291, 348 (1988) (with further references). 136 Intermetals Corp. v. Hanover International Aktiengesellschaft fur Industriever- sicherungen, 188 F. Supp.2d 454, 457-458 (D.N.J. 2001) (applying lex fori to a jurisdiction agreement in a contract governed by ). This also happened, for example, in a series of investor against the English Lloyd’s insurance company. Cases from various circuits are cited in Lipcon v. Underwriters at Lloyd’s, London, 148 F.3d 1285, 1291 (11th Cir. 1998). 137 Dunne v. Libbra, 330 F.3d 1062, 1064 (8th Cir. 2003) (applying lex causae to the interpretation of a jurisdiction agreement); Lambert v. Kysar, 983 F.2d 1110, 1118- 1119 (1st Cir. 1993); TH Agriculture & Nutrition, L.L.C. v. Ace European Group Ltd., 416 F. Supp.2d 1054, 1075 (D. Kan. 2006); Hoes of America, Inc. v. Hoes, 493 F. Supp. 1205, 1207 (C.D. Ill. 1979); General Engineering Corp. v. Martin Marietta Alumina, Inc., 783 F.2d 352, 357-358 (3rd Cir. 1986) (referring to the Restatement (Second) of Conflict of Laws § 187). 138 Yackee, Choice of Law Considerations in the Validity & Enforcement of International Forum Selection Agreements: Whose Law Applies?, 9 UCLA J. Int’l L. & Foreign Aff. 43, 63 (2004); see also Born/Rutledge, International Civil Litigation in United States Courts 505 (2007); Lederman, Viva Zapata: Toward a Rational System of Forum- Selection Clause Enforcement in Diversity Cases, 66 N.Y.U. L. Rev. 422, 461-464 (1991). But see Mullenix, Another Choice of Forum, Another Choice of Law: Consen- sual Adjudicatory Procedure in Federal Court, 57 Fordham L.Rev. 291, 347 (1988)

24 Chapter 2: The Legal Framework appears to be the position of the Supreme Court.139 The application of conflict of laws principles to jurisdiction agreements would also bring legal practice more in line with §§ 186-188 of the Restatement (Second) of Conflict of Laws and thereby with the general choice of law principles for contracts, although it is unclear to what extent § 80 of the Restatement (Second) of Conflict of Laws on jurisdiction agreements is supposed to prevail over the general rules. While the determination of the contractual validity of jurisdiction agreements in accordance with the governing law remains contentious, the reasonableness test140 follows lex fori141 and so do all other rules which govern their procedural effect, as for example 28 U.S.C. § 1404(a).

II. The European framework for jurisdiction clauses

1. The -Lugano regime The European framework for jurisdiction agreements has its roots in a between the then members of the European Community – the 1968 Brussels Convention on jurisdiction and the enforcement of judgments in civil and com- mercial matters (Brussels Convention).142 It was followed by the Lugano Conven- tion,143 which is a parallel treaty between the European Community and the member states of the European Free Trade Association,144 and eventually by Reg. (EC) 44/2001 on jurisdiction and the recognition and enforcement of in civil and commercial matters (Judgments ). The text of these instru- ments is very similar and this similarity allows interpreting them in the same manner.145 Nevertheless, they are not identical, which makes it necessary to determine their relation. The Brussels Convention has been replaced by the Judgments Regulation, and it applies between all member states, except in the relation between Denmark to

(denouncing choice of law analysis as “idle speculation”); Solimine, Forum-Selection Clauses and the Privatization of Procedure, 25 Cornell Int’l L.J. 51, 78 (1992). 139 See Gruson, Forum-Selection Clauses in International and Interstate Commercial Agreements, 1982 U. Ill. L. Rev. 133, 186 f.n. 228. 140 See below, Chapter 7 A. I. 1. 141 Hoes of America, Inc. v. Hoes, 493 F. Supp. 1205, 1208 (C.D. Ill. 1979). Compare Restatement (Second) of Conflict of Laws § 80 (1988). A careful application of the public policy exception is urged by Yackee, Choice of Law Considerations in the Validity & Enforcement of International Forum Selection Agreements: Whose Law Applies?, 9 UCLA J. Int’l L. & Foreign Aff. 43, 82-83 (2004). 142 27 September 1968, 1998 O.J. (C 27) 1 (consolidated version) [hereinafter Brussels Convention]. 143 Convention on jurisdiction and the enforcement of judgments in civil and commercial matters, 16 September 1988, 1988 O.J. (L 319) 9 [hereinafter Lugano Convention]. 144 At that time those states were Austria, Finland, Iceland, , and Switzer- land. Further accessions by other states have followed. 145 See only Verein für Konsumenteninformation v. Henkel, [2002] ECR I-8111 at [49]; Schmidt, Europäisches Zivilprozessrecht 10-11 (2004).

A. The legal framework for jurisdiction clauses 25 the other member states. In the relation to Denmark, the Brussels Convention remained in force at first146 because of Denmark’s initial rejection of the Maastricht Treaty of 1992, which established EC competency in the field of civil judicial matters. Subsequently, the European Community and Denmark entered into a separate agreement,147 which extended the application of Reg. (EC) 44/2001 and its implementing measures to the relations between the EC and Denmark. As a result, Reg. (EC) 44/2001 now applies between all member states and the Brussels Convention only applies to old cases. The Lugano Convention still controls the relation between member states and those states, which are party to the Lugano Convention but not a member of the European Community,148 in particular where a jurisdiction agreement confers jurisdiction on the courts of one of those states.149 The relevance of the Lugano Convention has diminished since many of the participating states are now mem- bers of the European Community and as such within the application of the Judg- ments Regulation. In the near future, the revised Lugano Convention 2007150 will replace the Lugano Convention which is currently in force. The revised Lugano Convention 2007 closely follows Reg. (EC) 44/2001.151 Together, Reg. (EC) 44/2001, the Brussels Convention and the Lugano Con- ventions form what has been denominated the “Brussels-Lugano regime.” With the imminent adoption of the Lugano Convention 2007, the Brussels-Lugano regime will reach an even higher degree of uniformity. The Brussels-Lugano regime will then be based entirely on the Judgments Regulation and the virtually identical Lugano Convention 2007. For the sake of convenience and readability, the analysis below will therefore focus on the Judgments Regulation. The findings can be applied to the Brussels and Lugano Conventions as well, unless otherwise indicated.

146 See preamble (21)-(22) of Reg. (EC) 44/2001. 147 Agreement between the European Community and the Kingdom of Denmark on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, 19 October 2005, 2005 O.J. (L 299) 62. The agreement entered into force on July 1 2007, see 2007 O.J. (L 94) 70. 148 Art. 54b Lugano Convention. 149 Art. 54b (2) (a), 17 Lugano Convention. 150 30 October 2007, 2007 O.J. (L 339) 3 [hereinafter Lugano Convention 2007]. The new convention will enter into force six months after its ratification by the European Com- munity and a member of the European Free Trade Association, Art. 69 of the Lugano Convention 2007. Entry into force is expected sometime in 2009 or 2010. 151 Of particular relevance in this context is that Art. 23 of the Lugano Convention 2007, which governs jurisdiction agreements, is identical to Art. 23 Reg. (EC) 44/2001, except of course that “Member State” is substituted by “State bound by this Conven- tion.”

26 Chapter 2: The Legal Framework

2. Scope of the Brussels-Lugano regime The Judgments Regulation generally applies to all civil and commercial matters,152 the most notable exception in the context of this study being arbitration.153 Art. 23 Reg. (EC) 44/2001, which regulates jurisdiction agreements, sets forth some personal limitations, in particular in insurance matters as well as for consumer and employment contracts,154 but these limitations do not affect jurisdiction clauses in maritime transport documents.155 By its own terms, the application of Art. 23 Reg. (EC) 44/2001 rests on two conditions. The first condition is that at least one of the parties has its domicile in one of the member states. This requirement is also met if the plaintiff is domiciled in a non-member state156 or if the agreement is between two citizens of the same state, provided that the case has cross-border elements.157 The second condition is that the chosen forum is located in a member state.158 If these two conditions are not met, national law applies – especially when EU residents agree on a forum in a non-member state and when two non-residents enter into a jurisdiction agreement, even though for the latter case the Judgments Regulation makes an exception if

152 Art. 1 Reg. (EC) 44/2001. 153 Art. 1 (2) (d) Reg. (EC) 44/2001. 154 Art. 23 (5) Reg. (EC) 44/2001. 155 Art. 15 (3) Reg. (EC) 44/2001 stipulates that the section which governs jurisdiction over consumer contracts does not apply to contracts of transport, except for those con- tracts which provide for a combination of travel and accommodation. The latter excep- tion refers to package tours, where accommodation must be separate from the transportation, see Layton/Mercer, European Civil Practice 597 (2004). However, as a convention governing jurisdiction in particular matters within the meaning of Art. 71 (1) Reg. (EC) 44/2001, the Athens Convention (see below, Chapter 2 A. III.) still applies in those member states which were parties to the Athens Convention before Reg. (EC) 44/2001 entered into force. 156 Group Josi Reinsurance Co. SA v. Universal General Insurance Co., [2000] ECR I- 5925 at [42] (referring to Art. 17 of the Brussels Convention). This judgment reversed a contrary interpretation by national courts and ended a long debate, compare Hausmann, in Staudinger (ed.), Kommentar zum Bürgerlichen Gesetzbuch Anhang II zu Art. 27-37 EGBGB ¶¶ 168-169 (2002). 157 Despite the broad wording of Art. 23 (1) Reg. (EC) 44/2001 which would permit the application to agreements between citizens of the same state and without any cross- border relevance such cases are still subject to national law, Kropholler, Europäisches Zivilprozeßrecht Art. 23 ¶ 2 (2005). On the other hand, if there is a cross-border rele- vance, the simple fact that the agreement is between two citizens of the same state is not sufficient to remove the case from the scope of the Judgments Regulation, as seems to be suggested by Joseph, Jurisdiction and Arbitration Agreements and their Enforcement 75 (2005). 158 Art. 23 (1) Reg. (EC) 44/2001. Some commentators have proposed further limitations, in particular a connection of the dispute to another member state, compare Kropholler, Europäisches Zivilprozeßrecht Art. 23 ¶¶ 4-8 (2005) (describing the different views). Such proposals, however, have been rejected by the European Court of , Owusu v. Jackson, [2005] ECR I-1383 at [34].

A. The legal framework for jurisdiction clauses 27 the chosen forum is located in a member state.159 In that case, the derogative effect of such an agreement displaces jurisdiction in other member states unless the chosen court declines jurisdiction under its national law.160 Even within the scope of Art. 23 Reg. (EC) 44/2001, there is room for the application of national law. Art. 23 Reg. (EC) 44/2001 is conclusive on the form of jurisdiction agreements161 and it may preempt substantive national law on certain matters.162 However, there are many issues that remain to be governed by the applicable national contract law, as determined by the conflict of laws rules of the forum.163 These issues include for example legal representation, legal capacity and the impact of misrepresentation, error and duress. In sum, national law on international jurisdiction agreements has largely, but not completely, been replaced by the Judgments Regulation. Regarding the relation to other conventions, the Brussels and Lugano Conven- tions contain different rules than the Judgments Regulation. Whereas the Brussels and Lugano Conventions do not affect any other existing or future conventions which in relation to particular matters govern jurisdiction or the recognition and enforcement of judgments,164 the Judgments Regulation preempts all but those conventions already in force at the time the Judgments Regulation became effec- tive.165

159 Art. 23 (3) Reg. (EC) 44/2001. 160 If two non-residents agree on a forum in a member state, the chosen court is not bound to take jurisdiction under the Brussels-Lugano regime, Kruger, Civil Jurisdiction Rules of the EU and Their Impact on Third States 217 (2008). 161 Elefanten Schuh GmbH v. Jacqmain, [1981] ECR I-1671 at [25]-[26]. 162 Trasporti Castelletti Spedizioni Internazionali SpA v. Hugo Trumpy SpA, [1999] ECR I-1579 at [51] (discussing the effect of mandatory liability rules). The contradictory judgment has left commentators speculating about the extent to which substantive law is affected, Layton/Mercer, European Civil Practice 691-694 (2004). This is discussed in more detail below, Chapter 7 A. II. 163 BGH 15 February 2007, BGHZ 171, 141, 148; Hausmann, in Staudinger (ed.), Kom- mentar zum Bürgerlichen Gesetzbuch Anhang II zu Art. 27-37 EGBGB ¶ 183 (2002); Kropholler, Europäisches Zivilprozeßrecht Art. 23 ¶¶ 18, 28 (2005); Kruger, Civil Jurisdiction Rules of the EU and Their Impact on Third States 223-224 (2008); Layton/Mercer, European Civil Practice 693 (2004); Magnus, in Magnus/Mankowski (eds.), Brussels I Regulation Art. 23 ¶ 82 (2007); Mankowski, in Rauscher (ed.), Euro- päisches Zivilprozeßrecht Art. 23 Brüssel I-VO ¶ 41 (2006). Others argue in favor of lex fori, Kim, Internationale Gerichtsstandsvereinbarungen 82 (1995), or of an auto- nomous law, based on the requirement of an “agreement”, Kröll, Gerichtsstandsver- einbarungen aufgrund Handelsbrauchs im Rahmen des GVÜ, ZZP 2000, 135, 144- 147. 164 Art. 57 (1) of the Brussels and the Lugano Convention; Art. 67 (1) of the Lugano Convention 2007. 165 Art. 71 (1) Reg. (EC) 44/2001. Most relevant in this context are the International Convention relating to the arrest of seagoing , 10 May 1952, 439 U.N.T.S. 194 [hereinafter Arrest Convention], compare Collins, Dicey and Morris on the Conflict of Laws ¶ 12-102 (2006); Tetley, Jurisdiction Clauses and Forum Non Conveniens in the Carriage of Goods by Sea, in Davies (ed.), Jurisdiction and Forum Selection in Inter- national Maritime Law 183, 197-198 (2005); the CMR, compare Nürnberger Allge-

28 Chapter 2: The Legal Framework

Another question is, to what extent jurisdictional rules in conventions on par- ticular matters preclude the application of the Brussels-Lugano regime. Those specialized conventions usually do not set up a comprehensive regime on jurisdic- tion and the enforcement of judgments. Under these circumstances, the Brussels- Lugano remains applicable to issues not governed by the specialized conven- tion.166

III. The English framework for jurisdiction clauses

It is important to keep in mind that the Brussels-Lugano regime heavily dominates the English framework for jurisdiction clauses – as well as the German framework discussed below. This analysis therefore only concerns those cases where national law is not displaced by the Judgments Regulation. Under English law, the validity of a jurisdiction agreement is determined in accordance with its putative govern- ing law,167 except for mandatory rules of English law.168 The conflict of laws analysis often leads to the application of English law since jurisdiction agreements conferring jurisdiction on English courts are usually interpreted to imply a choice of English law.169 English substantive law on jurisdiction agreements is largely case law. How- ever, the is a party to two conventions which include rules on jurisdiction agreements in maritime transport documents. One of those conven- tions is the 1956 Convention on the Contract for the International Carriage of Goods by Road (CMR),170 which not only applies to road transport but to ro-ro transports involving trucks as well.171 The other convention is the Athens Conven-

meine Versicherungs A.G. v. Portbridge Transport International B.V., [2004] ECR I- 10327; Vestergaard Pedersen, Transportret 368 (2008); as well as the Athens Conven- tion relating to the Carriage of Passengers and their Luggage by Sea, 13 December 1974, 1463 U.N.T.S. 19. These conventions will be addressed in the descriptions of the respective national frameworks for jurisdiction agreements below. 166 Tatry v. Maciej Rataj, [1994] ECR I-5439 at [24]. See also Mankowski, Spezialabkom- men und EuGVÜ, EWS 1996, 301. 167 Collins, Dicey and Morris on the Conflict of Laws ¶ 12-098 (2006); Denning, Choice of Forum Clauses in Bills of Lading, 2 J. Mar. L. & Com. 17, 23 (1970); Joseph, Juris- diction and Arbitration Agreements and their Enforcement 75 (2005); Peel, Exclusive jurisdiction agreements: purity and pragmatism in the conflict of laws, [1998] LMCLQ 182, 187. 168 Peel, Exclusive jurisdiction agreements: purity and pragmatism in the conflict of laws, [1998] LMCLQ 182, 217. 169 Peel, Exclusive jurisdiction agreements: purity and pragmatism in the conflict of laws, [1998] LMCLQ 182, 193; see also Wilson, Carriage of Goods by Sea 321 (2008) (not- ing that jurisdiction clauses are one among others in the determination of the applicable law). 170 Convention on the Contract for the International Carriage of Goods by Road, 19 May 1956, 399 U.N.T.S. 189 [hereinafter CMR]; enacted by the Carriage of Goods by Road Act 1965. 171 For a more detailed description of the CMR see below, Chapter 3 B. II. 2.

A. The legal framework for jurisdiction clauses 29 tion Relating to the Carriage of Passengers and their Luggage by Sea 1974 (Athens Convention).172 Moreover, there are some statutes which have an impact on the validity of jurisdiction clauses in maritime transport documents. The Carriage of Goods by Sea Act 1971 (COGSA 1971) essentially brought the force of law to the Hague- Visby Rules,173 although limited to outgoing traffic only.174 The Carriage of Goods by Sea Act 1992 (COGSA 1992) does not concern liability issues, but the rights and obligations of third parties, contrary to COGSA 1971 and the U.S. COGSA. It constitutes a reaction to the doctrine of privity of contract, a rather particular aspect of English law. The Contracts (Rights of Third Parties) Act 1999, which has a similar function with respect to contracts in general, is largely pre- empted by COGSA 1992.175 The English Civil Procedure Rules (CPR) only contain provisions on techni- calities of the enforcement of – otherwise valid – jurisdiction clauses176 and do not affect the validity of jurisdiction clauses. Likewise, Rule 12 of the Civil Jurisdic- tion and Judgments Act 1982, Sched. 4, which specifically regulates jurisdiction agreements, is of limited relevance for this study. It is only applicable in cases where a jurisdiction agreement confers venue on a court in a particular part of the United Kingdom and the defendant is domiciled in another part of the United Kingdom. It is closely modeled on Art. 23 Reg. (EC) 44/2001, but contrary to Art. 23 Reg. (EC) 44/2001 contains no requirement of form. Regarding civil procedure, however, the effect of the forum non conveniens doctrine on jurisdic- tion agreements will have to be considered.

172 Athens Convention relating to the Carriage of Passengers and their Luggage by Sea, 13 December 1974, 1463 U.N.T.S. 19 [hereinafter Athens Convention]. The Athens Con- vention has been adopted by 32 nations representing approximately 40% of the world tonnage. The Athens Convention has the force of law by virtue of s. 183 (1) of the Merchant Shipping Act 1995. 173 The Hague-Visby Rules are a set of rules based on the Hague Convention and two subsequent protocols, the Protocol to amend the International Convention for the unifi- cation of certain rules of law relating to bills of lading, 23 February 1968, 1412 U.N.T.S. 127 [hereinafter the Visby Amendments]; and the Protocol amending the International Convention for the unification of certain rules of law relating to bills of lading, 21 December 1979, 1412 U.N.T.S. [hereinafter SDR protocol]. For a descrip- tion of the development of the Hague-Visby Rules, see below, Chapter 3 A. I. 174 COGSA 1971, s. 1 (3). 175 See below, Chapter 9 A. III. 176 For cases that fall under the Judgments Regulation or the Civil Jurisdiction and Judg- ments Act 1982, Sched. 4, r. 12, no permission of the court is required to serve a claim form on a party outside the jurisdiction, CPR r. 6.19 (1) (b) (iii) and (1A) (b) (iii). Otherwise, permission is required, CPR r. 6.20 (5) (d). Compare Tetley, Marine Cargo Claims 1969-1972 (2008).

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