Private International law Sciences Po Paris Spring 2017 PIL for contract law Giuditta Cordero-Moss, Ph.D., Dr.Juris Professor, Oslo University

Forum Norwegian seller Italian buyer The goods do not comply with contract, buyer pays only part of the price Alt. 1: Seller sues to obtain payment Alt. 2: Buyer sues to obtain specific performance

Sources Lugano Convention If German seller: Brussels I If Italian defendant and claimant outside EU/EEA: Brussels I If Norwegian defendant and claimant outside EU/EEA: Norwegian civil procedure (controversial)

Court’s discretion? Brussels I, Lugano: No discretion Norwegian civil procedure: Some discretion (controversial) US, UK civil procedure: Discretion

General rule Art. 4 Brussels I, Art. 2 Lugano: The defendant’s domicile Alt. 1: Forum in Italy Alt. 2: Forum in Norway

How to determine domicle I Art. 62 Brussels I, Art. 59 Lugano: Domicile is determined by the law of the place where a party is domiciled.

How to determine domicle II Art. 63 Brussels I, Art. 60 Lugano: A company is domiciled at the place where it has its: statutory seat; central administration; or principal place of business

Alternative forum for activity of branch Art. 7.5 Brussels I, art. 5.5 Lugano: (5) as regards a dispute arising out of the operations of a branch, agency or other establishment, in the courts for the place where the branch, agency or other establishment is situated

Alternative forum for contracts Art. 7.1 Brussels I, 5.1 Lugano: in the courts for the place of performance of the obligation in question; for the purpose of this provision and unless otherwise agreed, the place of performance of the obligation in question shall be: — in the case of the sale of goods, the place in a Member State where, under the contract, the goods were delivered or should have been delivered, — in the case of the provision of services, the place in a Member State where, under the contract, the services were provided or should have been provided; if point (b) does not apply then point (a) applies;

Qualification Contract: obligation freely assumed by one party towards the other.(C-51/97) Autonomous interpretation(C-12/15, C-196/15) Membership in an association (C-34/82) Not: direct claim against producer(C-26/91) Not: guarantor’s recourse against debtor (C-265/02) Not: culpa in contrahendo (C-334/00)

Place of performance Swap agreement between Norwegian and German bank Place of performance of monetary obligations: German law: debtor’s place Norwegian law: creditor’s place How do you define place of performance?

Place of peformance is determined under the lex causae Under the law that governs the contract C-12/76 Under the law that would have governed the contract, if the contract had been valid C-38/81

Place of performance of «the obligation in question» Brussels Convention: The obligation on which the claim is based C-12/76 To avoid creditor’s forum: Brussels I (44/2001): Characteristic obligation for sales and services

Special forum rules for weak contractual party Insurance Sec. 3 Brussels I, Lugano Consumer contracts Sec. 4 Brussels I, Lugano Individual employment contracts Sec. 5 Brussels I, Lugano

Choice of forum agreements Art. 25 Brussels I, art. 23 Lugano: courts are bound by choice of forum agreements “Any disputes arising from this contract shall be brought before the courts of Oslo” But: CDC C-352/13 21.5.15: not for disputes on damages following anti-competitive agreements Does not apply to exclusive fora

Choice of law Party autonomy Default conflict rule

Party autonomy Norwegian seller Italian buyer Governing law clause: “This contract shall be governed by the laws of Norway”

Effects of the parties’ choice Mandatory rules of the otherwise applicable law are not applicable In domestic contracts: mandatory rules are applicable(art. 3.3 Rome I) In intra-EU contracts: EU mandatory rules are applicable (art. 3.4 Rome I) Overriding mandatory rules prevail (art. 9 Rome I)

Scope of the parties’ choice Governing law clause chooses Norwegian law The Italian party alleges it lacks legal capacity according to Italian law Norwegian court Shall the court apply only the chosen law, or shall it apply also the laws of each of the parties?

Tacit choice ”Clearly demonstrated by the terms of the contract or the circumstances of the case” (art. 3 Rome I) The choice must be actual Use of standard form clearly drafted under a specific law Hypothetical choice is not allowed Choice of forum Contract clauses inspired by a legal system

Lacking parties’choice Norwegian seller Italian buyer No governing law clause The habitual residence of the party making the characteristic performance (art. 4 Rome I)

Evolution of the rule Rome Convention Rome I Closest connection Presumption: habitual residence of characteristic debtor Exception: closest connection Rome I General connecting factors for named contract types Habitual residence of characteristic debtor for other contracts

Special conflict rules Carriage (Art 5 Rome I) Consumer (Art 6 Rome I) Insurance (Art 7 Rome I) Individual employment contracts (Art 8 Rome I)