Justification of lawsuit in respect of jurisdiction

Primacom AG and others (2005) EWHC 508 , Primacom submitted proceedings in Germany, in breach of jurisdiction clause in favour of English Courts. On the other hand, JP Morgan issued separate proceedings in English Courts,  seeking for enforceability of interest provisions in a loan agreement. Judge had no other choice except to apply Article 27 of the Regulation. As a result English court proceedings were adjourned until the German courts had determined whether jurisdiction is considered.

Some of the practical impacts of determining jurisdiction are that, it involves excessive delay in solving disputes, costs and uncertainty to a great extent leaving both the contractual parties to take a lenient view until the court’s decision is issued. Application of law in dispute Corporate accountability  in respect of statutory seat and establishment of business carries a great significance in application of laws in case of disputes. Brussels Regulation was adopted by EU Council Regulation (EC) No 44/2001 which pertains to jurisdiction, recognition and enforcement of judgments in civil and commercial disputes.

These rules came into effect on 1 March 2002 (SI 2001 No. 3939) For application of law, first of all there has to be a contractual obligation [Boss Group Ltd. , v Boss France S. A]. According to Lord Clyde while giving judgment for Effer S. p. A v Kantner (Case 38/81) E. C. R. 825 "The case was one of enforcement of the performance of a contract. The preliminary problem of determining whether there was a contract between the parties in such circumstances falls within the scope of Article 5(1).

The court reasoned that the power to determine questions relating to a contract included the power to consider the constituent parts of the contract itself, since that was indispensable for the determination of its jurisdiction. Once there is a dispute as to the existence of a contract the performance of which the one party is seeking to enforce or for the non-performance of which he is seeking a remedy, then it should not matter whether procedurally it is the defendant or the plaintiff who raises the issue of the existence of the contract.

" (p. 182F-G) The domicile is determined by the domestic law of Member State where the country  have a statutory seat, administration or principal place of business. The court has to apply its rules of private international law. Both the contractual parties can launch an appeal before one of the courts listed in the annex to the Regulation and seek relief of judgment. Jurisdiction of English Courts The jurisdiction of English courts is determined in contract clauses by which both the parties of contract are bind legally to the contract.

The wordings of clauses carry great importance in actual execution and treatment of words as and when a dispute or a conflict arises during the tenure of contract period. Jurisdiction clauses indicate the country chosen to resolve disputes and the court system which will accept a lawsuit in case of conflict. Both the parties have to accept such court system set out in the contract. Further it also avoids multiple proceedings of claimant and defendant in two jurisdictions.

Import Export Metro Ltd v Compania Sud Americana De Vapores SA [2003] EWHC 11. If an English-based claimant has filed a proceeding against a foreigner and if the dispute has no connection with England, the court has the power to stay the proceedings. If the court lacks jurisdiction, and if the defendant satisfies the court that a forum other than England, the court will stay the proceedings for finding a justice. Also in some cases, questions arise whether English court has jurisdiction to handle the dispute.

If handling, what system of law, whether English or foreign would be applied. Also a question arises whether English court will enforce foreign judgment to determine and solve the issue of parties. When English courts have jurisdiction, depending on the choice of language made by the parties, court may apply foreign or English. In this regard of jurisdiction, it can be concluded that in English conflict of law cases, questions of choice of law remain quiet and instead questions about jurisdiction prevail at all times.

Further the discretionary powers of English court are based on, the evidence and facts of the case, whether the law of foreign court applies and if it is applicable, whether the law differs from English in any aspect, which are the countries and parties connected and how intimately, whether the defendant is honestly looking for a trial in a foreign country or in any way seeking only a procedural benefit  and finally what are the pros and cons of claimant.