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意大利
意大利——你的选择法院条款是可实施的吗？
20 3 月 2018
- 冲突法
根据意大利法律，合同的各方当事人——均为私法上的实体——一般可自行约定对这种合同可能引起的任何纠纷拥有管辖权的法院。
然而，虽然这些条款是有效的，但它们的可执行性可能会受到某些正式要求的限制，这些限制应该在双方约定管辖法院时考虑在内。
奇怪的是，当合同的双方都在意大利时，这些要求往往会更加严格，如果其中一方设在国外，特别是在其他的欧盟国家，这些要求就会更加宽松。
不过，考虑到判例法目前存在的不确定性，在起草合同时采取谨慎的做法无论如何都是有道理的。
排他性或者非排他性法院？
让我们以两家私营公司之间的商业合同中的以下条款为例：“管辖法院-米兰法院是处理任何争端的管辖法院”。
这项条款显然不会引起任何争议。然而，意大利最高法院（“Corte di Cassazione”）最近裁定该条款不可实施，特别是从其非排他性的角度（最高法院民事组（Cass. Civ. Sez.）Ⅵ-3，order25.1.2018第1838号）。
在这种情况下，一家意大利公司让另一方（另一家意大利公司）签署其载有上述条款的一般合同条款。尽管如此，第一家公司随后收到了锡耶纳法院签发的支付令（“decreto ingiuntivo”），第二家公司尽管已认可了法院地条款，但还是提起了诉讼。
第一家公司提出锡耶纳法院缺乏管辖权的论点，但未能成功地反驳支付令。事实上，它不能强制执行其一般合同条款中的法院地条款，因为该条款没有规定米兰法院是“排他性”法院。
因此，根据我国最高法院的意见（实际上确认了其以前的判例法），为了使法院地条款能够得到所希望的执行，该条款应写作：“米兰法院是处理任何争端的排他性管辖法院”。
不过，值得注意的是，如果与意大利之外的其他欧盟国家（例如法国）的公司签署相同的一般合同条款，即使诉讼地条款没有具体说明其排他性，这家公司也可以成功地阻止它在法国提起诉讼。
这是因为欧盟第1215/2012号条例的第25条明确规定，“除当事人另有约定外，管辖权条款具有排他性”。
意大利最高法院也确认了这一点（例如，见2012年3月8日第3624号裁决）。
现在，如果米兰公司的合同伙伴是一个总部设在非欧盟国家的公司，而不受关于这个问题的国际条约的约束，会发生什么情况？例如，一家美国公司？
从意大利法院的角度来看，“米兰法院是解决任何争端的管辖法院”这一条款是否具有排他性？
第1215/2012号条例第6条引导意大利法院根据同一条例第25条将该条款解释为排他性条款。然而，在过去的类似案件中，意大利法院认为这些条款是非排他性的，适用国际私法的国内规则（第218/95号法律，第4条），并根据《民事诉讼法》第29条第2款加以解释（例如见米兰法庭，1997年12月11日）。因此，在上述案件中，如果美国公司不顾上述条款在其国家提起诉讼，那么在美国作出的裁决可能会在意大利得到承认。
2005年6月30日《海牙公约》中关于法院地的选择条约解决了上述问题和其他问题，因为该公约（与《欧洲条例》一样）规定，所选定的法院具有排他性，但明确的相反协议除外。然而，目前只有非常有限的几个国家（欧洲联盟、墨西哥、新加坡）才实行这个公约。
在这种不确定的情况下，如果一方希望所选择的法院具有排他性，而不管对方当事人的所在地在哪里，意大利法律规定的最谨慎的做法肯定是在该条款中具体说明排他性问题。
不平等条款的“特别批准”（《民法典》第1314条）
意大利法律中法院选择条款的可执行性的另一个先决条件是，如果将这类条款包括在一般合同条款中，则要求“特别批准”这些条款。根据《民法典》第1341条第2款，一般合同条款中的某些类型的“不公平”条款除非以书面形式“特别批准”，否则是不可执行的。这种“不公平条款”也包括仲裁和法院选择条款，如果有利于起草一般合同条款的当事人的话。
根据我国最高法院的现行判例，这种“特别批准”实际上是通过在合同上加上第二个签字而发生的，该签字必须是自主的，并且与通常用来批准整个合同的签字分开。另外，这种第二次批准必须通过列举每一个条款的编号和标题来明确指出每一个不公平的条款。
不过，关于法院选择条款的特别批准要求仅适用于意大利当事人之间的合同，不适用于国际合同。
尤其是在适用欧盟第1215/2012号条例时，第25条规定的形式要件不那么严格，甚至法院地条款是一般合同的一部分时，也必须遵守。在这种情况下，当事人签署的合同必须明确提及载有法院地条款的一般条款（例如见Cass. Sez. Un. 6.4.2017 n.8895）。在以电子方式订立的销售合同中出现一般合同条款的情况下，法院选择条款（也是根据欧盟条例）可以通过“点击”（见EUCJ的第322号决定，2015年5月21日）得到有效承认。
即使适用意大利国际私法（第218/95号法律，第4条）–也就是说，在本质上，涉及非欧盟（或非欧经区/欧贸区）当事方的事项时，–法院选择条款也不需要“特别批准”条件，因为第4条没有明文规定，也没有相关的司法解释（宪法法院，18/10/2000，第428号）。
尽管如此，《民法典》第1341条中关于“特别批准”的要求作为强制执行法律规定视为“不平等”的其他条款的一个条件，例如限制或排除赔偿责任条款，是否也应适用于国际合同（如果受意大利法律的管辖），还没有最后澄清。
因此，在意大利，起草一般合同条款，以及国际合同条款，规定对方第二次签字，对不平等条款给予特别批准，仍然是很常见的。
所有的这一切，寄希望于意大利法理学在未来能发展出更加现代和国际化的解决方法。
With the recent sentence n° 16601/2017 the Italian Supreme Court (“Corte di Cassazione”) – changing its jurisprudence – opened to the possibility of recognizing in Italy foreign judgments containing punitive damages. In this post we will see what these punitive damages are about, under which conditions they will be recognized and enforced in Italy and, above all, which countermeasures may be implemented to deal with these new risks.
Punitive damages are a monetary compensation – typical of common law legal systems – awarded to an injured party that goes beyond what is necessary to compensate the individual for losses. Normally punitive damages are imposed when the person who caused the damage acted with wilful misconduct and gross negligence.
With punitive damages, other than the compensatory function, the reimbursement of damages assumes also a sanctioning purpose, typical of criminal law, also acting like a deterrent towards other potential lawbreakers.
In the legal systems that provide for punitive damages, the recognition and the quantification of the highest compensation, most of the time, are delegated to the Judge.
In the United States of America punitive damages are a settled principle of common law, but ruled in different ways for each State. However, generally, they are applied when the conduct of person who caused the damage was intentionally directed to cause damage or is put in place without regard to the protection and safety standards. Usually they cannot be awarded for breach of contract, unless it also leads to an independent tort.
Historically, in Italy, punitive damages generally were not recognized, because the sanctioning purpose is not consistent with the civil law principles, anchored to the concept that the reimbursement of the damage is a simple restoration of financial heritage of the damaged person.
Therefore, the recognition of punitive damage established by a foreign judgment was normally denied due to a violation of the public policy (“ordre public”), so those judgments did not have access to the Italian legal system.
The sentence n° 16601/2017 of the 5 July 2017 of the Joint Sessions of Italian Supreme Court (“Sezioni Unite della Corte di Cassazione”) however, changed the cards on the table. In this particular case, the plaintiff applied to the Venice Court of Appeal for the recognition (pursuant to art. 64, law 218/1995) of three judgments of District Court of Appeal of the State of Florida that, accepting a guarantee call submitted by an American retailer of helmets against the Italian company, condemned this latter to pay 1.436.136,87 USD (in addition to legal expenses and interests) for the damages caused by a defect in the helmet used in occasion of the accident.
The Venice Court of Appeal recognized the foreign judgment, considering the abovementioned sum merely as compensation for damages and not as punitive damages. This decision was challenged by the unsuccessful Italian party before the Italian Supreme Court, arguing the violation of the Italian ordre public by the US judgment, on the basis of a consolidated juridical opinion until that day.
The Supreme Court of Cassation confirmed the Venice Court assessment, considering the sum non-punitive and recognized the US judgment in Italy.
The Supreme Court, though, took the opportunity to address the question of the admissibility of punitive damages in Italy, changing the previous orientation (see Cass. 1781/2012).
According to the Court, the concept of civil liability as mere compensation of the damage suffered is to be considered obsolete, given the evolution of this institute through national and European legislation and case-law that introduced civil remedies intended to punish the wrongdoer. As a matter of fact, in our system, it’s possible to find several cases of damages with sanctioning function: in the matter of libel by press (art. 12 L. 47/48), copyright (art. 158 L. 633/41), industrial property (art. 125 D. Lgs. 30/2005), abuse of process (art. 96 comma 3 c.p.c. e art. 26 comma 2 c.p.a.), labour law (art. 18, comma 14), family law (art. 709-ter c.p.c.) and others.
The Supreme Court has, therefore, stated the following principle: “Under Italian law, civil liability is aimed not only to compensate for losses incurred by the injured party, but also to reform the defendant and others from engaging in conduct similar. Therefore, the US legal institute of punitive damages is not incompatible with the Italian legal system”.
The important consequence is that this decision opens the door to possible recognition of foreign sentences that condemn a party to pay a sum higher than the amount sufficient to compensate the suffered injury as a result of the damage.
To that end, however, the Supreme Court has set certain conditions so that foreign sentences have validity, that is to say that the decision is made in foreign law system on a normative basis that:
- Clearly establish the cases in which it is possible to convict a party to pay punitive damages; and
- The predictability of it; and
- Establish quantitative limits.
It has to be clarified that the sentence has not modified the Italian system of civil liability. In other words, the sentence will not allow Italian Judges to establish punitive damages under Italian law.
As for foreign court decisions, it will be now possible to obtain a compensation for punitive damages through the recognition and enforcement of a foreign judgment, as long as they respect the above requirements.
Extending our view beyond the Italian borders, we notice that punitive damages are alien to the legal tradition of most of European States: there is the possibility, though, that other Courts of continental Europe might follow the decision of the Italian Supreme Court and recognize foreign judgments which grant punitive damages.
How to prevent this new risk
There are several measures which businessmen can adopt to mitigate this new risk: firstly the adoption of contractual clauses that exclude this kind of damages or establish a cap on the amount of the contractual damages which can be claimed, for example by limiting the value of damages at the price of the products or services provided.
Furthermore, it’s very important to have an overall knowledge of the legislation and case law of the markets in which the enterprise operates, even indirectly (for example: with the commercial distribution of products) in order to choose consciously the applicable law to the contract and the dispute resolution methods (for example: establishing the jurisdiction in a country that does not provide for punitive damages).
Finally, this type of liability and risk may also be covered by a product liability insurance.
The Italian Court of Cassation, United Sections (judgement no. 24244 of 27 November 2015), recently issued a judgement on the applicability of article 5 no. 1 of the Brussels I Regulation on the jurisdiction, recognition and enforcement of judgements in civil and commercial matters, now corresponding to article 7 no. 1 of the Regulation 1215/2012 (Brussels I bis).
The above-referenced provision sets a special forum in matters relating to a contract, providing for the competence of the courts located in the place of performance of the obligation in question. According to letter b) of this provision, in case of the sale of goods, the place of performance of the obligation in question shall be the place in a Member State where, under the contract, the goods were delivered or should have been delivered.
In the case brought before the Court of Cassation, an Italian company – while objecting the claim of a French company regarding the conclusion of some sale agreements that the latter stated to have entered into with the first one – asked for a declaratory judgement stating the inexistence of any contractual obligation between the parties, and, alternatively, for a declaration that the alleged agreements were null and void.
First of all, the Court of Cassation asserted the applicability of article 5, letter b) of the Brussels I Regulation to the case de quo.
Albeit recognizing that the abovementioned provision seems to refer only to actions addressed to the performance of a contract and not to actions regarding the dissolution of a contractual obligation, the Italian Supreme Court has considered that also claims aiming at ascertaining the inexistence, invalidity or ineffectiveness of an agreement concern matters relating to a contract. More precisely, the Supreme Court has held that such claims involve an initial, actual or alleged, voluntary assumption of an obligation, of which they tend, in several ways, to default. In the light of this assumption and considering that the delivery of the goods was supposed to take place in France (according to the contractual documents evidenced during the proceedings), the Court of Cassation has found that Italian Courts were lacking jurisdiction over the case, thus confirming the judgement previously issued by the Court of Appeal.
The judgement of the Italian United Sections is important because it has definitively confirmed, consistently with the European uniform trend, that the place of delivery is the only autonomous linking factor to be applied to all claims grounded on contracts for the sale of goods and not only to claims based on the non-performance of the delivery obligation itself.
The author of this article is Silvia Petruzzino.
A crucial clause in international contracts is the one which deals with litigation.
My advice, since we have seen that negotiation can be pretty long, complicated, and, exhausting, is that such clauses should not be the last to be dealt with, often times late at night when parties are exhausted, but the among the first.
Generally parties argue at length on such clauses, because neither party is willing to give up on its national jurisdiction for different reasons, foremost of all the fear that foreign judges would not be impartial and treat with favor the local part.
This deadlock often leads to bad compromises, like choosing the judge of a third state or combining the jurisdiction of one state with the application of the law of the other, which is definitely not recommended.
There is no one-fits-all solution to offer here: the advice is that such clauses should be tailor made on a case by case basis, and that the choice of a state court or arbitration should be expressed taking into account where the final decision shall be enforced.
If we foresee that our client may seek payment of a price or claim damages for breach of contract, ‘where is the money’ or ‘where are the assets’ should be the driving factor, and the choice of jurisdiction should be made accordingly.
If there is no such concern, and litigation may be foreseen only or mostly in a defensive scenario, then the proximity to the money or assets is no more a priority, and other options can be evaluated: in that case, the choice of a Judge in a far away country can be the best option, as it is a strong deterrent for litigation.
When battling for a clause with domestic jurisdiction, however, one should keep in mind that the process of recognition of a foreign decision is generally a rather complicated and lengthy process, even if (as is the case of Italy and China), there is a bilateral treaty for mutual recognition of judicial decisions (but very few cases have been recognized and enforced in China thereafter); it should also be kept in mind that all documents filed with the application for recognition of the foreign decision need to be translated into mandarin, notarized and legalized, which in complex litigations can represent an unforeseen additional high cost.
In other cases, like in the USA, where there is no bilateral treaty in this field, to litigate abroad often means that the foreign decision will be almost useless, with the necessity to sue again in China to seek enforcement of the decision.
Arbitration can be a valid alternative, as China is a member of the New York Convention of 1958 and enforcement of an arbitral award is in most cases easier and faster than the process of recognition of a foreign court decision.
中国 
欧洲 
写信给 Christian
Punitive damages – The Court of Cassation opens the door in Italy
25 11 月 2017
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意大利
- 冲突法
- 契约
- 征信
- 国际贸易
- 诉讼
根据意大利法律，合同的各方当事人——均为私法上的实体——一般可自行约定对这种合同可能引起的任何纠纷拥有管辖权的法院。
然而，虽然这些条款是有效的，但它们的可执行性可能会受到某些正式要求的限制，这些限制应该在双方约定管辖法院时考虑在内。
奇怪的是，当合同的双方都在意大利时，这些要求往往会更加严格，如果其中一方设在国外，特别是在其他的欧盟国家，这些要求就会更加宽松。
不过，考虑到判例法目前存在的不确定性，在起草合同时采取谨慎的做法无论如何都是有道理的。
排他性或者非排他性法院？
让我们以两家私营公司之间的商业合同中的以下条款为例：“管辖法院-米兰法院是处理任何争端的管辖法院”。
这项条款显然不会引起任何争议。然而，意大利最高法院（“Corte di Cassazione”）最近裁定该条款不可实施，特别是从其非排他性的角度（最高法院民事组（Cass. Civ. Sez.）Ⅵ-3，order25.1.2018第1838号）。
在这种情况下，一家意大利公司让另一方（另一家意大利公司）签署其载有上述条款的一般合同条款。尽管如此，第一家公司随后收到了锡耶纳法院签发的支付令（“decreto ingiuntivo”），第二家公司尽管已认可了法院地条款，但还是提起了诉讼。
第一家公司提出锡耶纳法院缺乏管辖权的论点，但未能成功地反驳支付令。事实上，它不能强制执行其一般合同条款中的法院地条款，因为该条款没有规定米兰法院是“排他性”法院。
因此，根据我国最高法院的意见（实际上确认了其以前的判例法），为了使法院地条款能够得到所希望的执行，该条款应写作：“米兰法院是处理任何争端的排他性管辖法院”。
不过，值得注意的是，如果与意大利之外的其他欧盟国家（例如法国）的公司签署相同的一般合同条款，即使诉讼地条款没有具体说明其排他性，这家公司也可以成功地阻止它在法国提起诉讼。
这是因为欧盟第1215/2012号条例的第25条明确规定，“除当事人另有约定外，管辖权条款具有排他性”。
意大利最高法院也确认了这一点（例如，见2012年3月8日第3624号裁决）。
现在，如果米兰公司的合同伙伴是一个总部设在非欧盟国家的公司，而不受关于这个问题的国际条约的约束，会发生什么情况？例如，一家美国公司？
从意大利法院的角度来看，“米兰法院是解决任何争端的管辖法院”这一条款是否具有排他性？
第1215/2012号条例第6条引导意大利法院根据同一条例第25条将该条款解释为排他性条款。然而，在过去的类似案件中，意大利法院认为这些条款是非排他性的，适用国际私法的国内规则（第218/95号法律，第4条），并根据《民事诉讼法》第29条第2款加以解释（例如见米兰法庭，1997年12月11日）。因此，在上述案件中，如果美国公司不顾上述条款在其国家提起诉讼，那么在美国作出的裁决可能会在意大利得到承认。
2005年6月30日《海牙公约》中关于法院地的选择条约解决了上述问题和其他问题，因为该公约（与《欧洲条例》一样）规定，所选定的法院具有排他性，但明确的相反协议除外。然而，目前只有非常有限的几个国家（欧洲联盟、墨西哥、新加坡）才实行这个公约。
在这种不确定的情况下，如果一方希望所选择的法院具有排他性，而不管对方当事人的所在地在哪里，意大利法律规定的最谨慎的做法肯定是在该条款中具体说明排他性问题。
不平等条款的“特别批准”（《民法典》第1314条）
意大利法律中法院选择条款的可执行性的另一个先决条件是，如果将这类条款包括在一般合同条款中，则要求“特别批准”这些条款。根据《民法典》第1341条第2款，一般合同条款中的某些类型的“不公平”条款除非以书面形式“特别批准”，否则是不可执行的。这种“不公平条款”也包括仲裁和法院选择条款，如果有利于起草一般合同条款的当事人的话。
根据我国最高法院的现行判例，这种“特别批准”实际上是通过在合同上加上第二个签字而发生的，该签字必须是自主的，并且与通常用来批准整个合同的签字分开。另外，这种第二次批准必须通过列举每一个条款的编号和标题来明确指出每一个不公平的条款。
不过，关于法院选择条款的特别批准要求仅适用于意大利当事人之间的合同，不适用于国际合同。
尤其是在适用欧盟第1215/2012号条例时，第25条规定的形式要件不那么严格，甚至法院地条款是一般合同的一部分时，也必须遵守。在这种情况下，当事人签署的合同必须明确提及载有法院地条款的一般条款（例如见Cass. Sez. Un. 6.4.2017 n.8895）。在以电子方式订立的销售合同中出现一般合同条款的情况下，法院选择条款（也是根据欧盟条例）可以通过“点击”（见EUCJ的第322号决定，2015年5月21日）得到有效承认。
即使适用意大利国际私法（第218/95号法律，第4条）–也就是说，在本质上，涉及非欧盟（或非欧经区/欧贸区）当事方的事项时，–法院选择条款也不需要“特别批准”条件，因为第4条没有明文规定，也没有相关的司法解释（宪法法院，18/10/2000，第428号）。
尽管如此，《民法典》第1341条中关于“特别批准”的要求作为强制执行法律规定视为“不平等”的其他条款的一个条件，例如限制或排除赔偿责任条款，是否也应适用于国际合同（如果受意大利法律的管辖），还没有最后澄清。
因此，在意大利，起草一般合同条款，以及国际合同条款，规定对方第二次签字，对不平等条款给予特别批准，仍然是很常见的。
所有的这一切，寄希望于意大利法理学在未来能发展出更加现代和国际化的解决方法。
With the recent sentence n° 16601/2017 the Italian Supreme Court (“Corte di Cassazione”) – changing its jurisprudence – opened to the possibility of recognizing in Italy foreign judgments containing punitive damages. In this post we will see what these punitive damages are about, under which conditions they will be recognized and enforced in Italy and, above all, which countermeasures may be implemented to deal with these new risks.
Punitive damages are a monetary compensation – typical of common law legal systems – awarded to an injured party that goes beyond what is necessary to compensate the individual for losses. Normally punitive damages are imposed when the person who caused the damage acted with wilful misconduct and gross negligence.
With punitive damages, other than the compensatory function, the reimbursement of damages assumes also a sanctioning purpose, typical of criminal law, also acting like a deterrent towards other potential lawbreakers.
In the legal systems that provide for punitive damages, the recognition and the quantification of the highest compensation, most of the time, are delegated to the Judge.
In the United States of America punitive damages are a settled principle of common law, but ruled in different ways for each State. However, generally, they are applied when the conduct of person who caused the damage was intentionally directed to cause damage or is put in place without regard to the protection and safety standards. Usually they cannot be awarded for breach of contract, unless it also leads to an independent tort.
Historically, in Italy, punitive damages generally were not recognized, because the sanctioning purpose is not consistent with the civil law principles, anchored to the concept that the reimbursement of the damage is a simple restoration of financial heritage of the damaged person.
Therefore, the recognition of punitive damage established by a foreign judgment was normally denied due to a violation of the public policy (“ordre public”), so those judgments did not have access to the Italian legal system.
The sentence n° 16601/2017 of the 5 July 2017 of the Joint Sessions of Italian Supreme Court (“Sezioni Unite della Corte di Cassazione”) however, changed the cards on the table. In this particular case, the plaintiff applied to the Venice Court of Appeal for the recognition (pursuant to art. 64, law 218/1995) of three judgments of District Court of Appeal of the State of Florida that, accepting a guarantee call submitted by an American retailer of helmets against the Italian company, condemned this latter to pay 1.436.136,87 USD (in addition to legal expenses and interests) for the damages caused by a defect in the helmet used in occasion of the accident.
The Venice Court of Appeal recognized the foreign judgment, considering the abovementioned sum merely as compensation for damages and not as punitive damages. This decision was challenged by the unsuccessful Italian party before the Italian Supreme Court, arguing the violation of the Italian ordre public by the US judgment, on the basis of a consolidated juridical opinion until that day.
The Supreme Court of Cassation confirmed the Venice Court assessment, considering the sum non-punitive and recognized the US judgment in Italy.
The Supreme Court, though, took the opportunity to address the question of the admissibility of punitive damages in Italy, changing the previous orientation (see Cass. 1781/2012).
According to the Court, the concept of civil liability as mere compensation of the damage suffered is to be considered obsolete, given the evolution of this institute through national and European legislation and case-law that introduced civil remedies intended to punish the wrongdoer. As a matter of fact, in our system, it’s possible to find several cases of damages with sanctioning function: in the matter of libel by press (art. 12 L. 47/48), copyright (art. 158 L. 633/41), industrial property (art. 125 D. Lgs. 30/2005), abuse of process (art. 96 comma 3 c.p.c. e art. 26 comma 2 c.p.a.), labour law (art. 18, comma 14), family law (art. 709-ter c.p.c.) and others.
The Supreme Court has, therefore, stated the following principle: “Under Italian law, civil liability is aimed not only to compensate for losses incurred by the injured party, but also to reform the defendant and others from engaging in conduct similar. Therefore, the US legal institute of punitive damages is not incompatible with the Italian legal system”.
The important consequence is that this decision opens the door to possible recognition of foreign sentences that condemn a party to pay a sum higher than the amount sufficient to compensate the suffered injury as a result of the damage.
To that end, however, the Supreme Court has set certain conditions so that foreign sentences have validity, that is to say that the decision is made in foreign law system on a normative basis that:
- Clearly establish the cases in which it is possible to convict a party to pay punitive damages; and
- The predictability of it; and
- Establish quantitative limits.
It has to be clarified that the sentence has not modified the Italian system of civil liability. In other words, the sentence will not allow Italian Judges to establish punitive damages under Italian law.
As for foreign court decisions, it will be now possible to obtain a compensation for punitive damages through the recognition and enforcement of a foreign judgment, as long as they respect the above requirements.
Extending our view beyond the Italian borders, we notice that punitive damages are alien to the legal tradition of most of European States: there is the possibility, though, that other Courts of continental Europe might follow the decision of the Italian Supreme Court and recognize foreign judgments which grant punitive damages.
How to prevent this new risk
There are several measures which businessmen can adopt to mitigate this new risk: firstly the adoption of contractual clauses that exclude this kind of damages or establish a cap on the amount of the contractual damages which can be claimed, for example by limiting the value of damages at the price of the products or services provided.
Furthermore, it’s very important to have an overall knowledge of the legislation and case law of the markets in which the enterprise operates, even indirectly (for example: with the commercial distribution of products) in order to choose consciously the applicable law to the contract and the dispute resolution methods (for example: establishing the jurisdiction in a country that does not provide for punitive damages).
Finally, this type of liability and risk may also be covered by a product liability insurance.
The Italian Court of Cassation, United Sections (judgement no. 24244 of 27 November 2015), recently issued a judgement on the applicability of article 5 no. 1 of the Brussels I Regulation on the jurisdiction, recognition and enforcement of judgements in civil and commercial matters, now corresponding to article 7 no. 1 of the Regulation 1215/2012 (Brussels I bis).
The above-referenced provision sets a special forum in matters relating to a contract, providing for the competence of the courts located in the place of performance of the obligation in question. According to letter b) of this provision, in case of the sale of goods, the place of performance of the obligation in question shall be the place in a Member State where, under the contract, the goods were delivered or should have been delivered.
In the case brought before the Court of Cassation, an Italian company – while objecting the claim of a French company regarding the conclusion of some sale agreements that the latter stated to have entered into with the first one – asked for a declaratory judgement stating the inexistence of any contractual obligation between the parties, and, alternatively, for a declaration that the alleged agreements were null and void.
First of all, the Court of Cassation asserted the applicability of article 5, letter b) of the Brussels I Regulation to the case de quo.
Albeit recognizing that the abovementioned provision seems to refer only to actions addressed to the performance of a contract and not to actions regarding the dissolution of a contractual obligation, the Italian Supreme Court has considered that also claims aiming at ascertaining the inexistence, invalidity or ineffectiveness of an agreement concern matters relating to a contract. More precisely, the Supreme Court has held that such claims involve an initial, actual or alleged, voluntary assumption of an obligation, of which they tend, in several ways, to default. In the light of this assumption and considering that the delivery of the goods was supposed to take place in France (according to the contractual documents evidenced during the proceedings), the Court of Cassation has found that Italian Courts were lacking jurisdiction over the case, thus confirming the judgement previously issued by the Court of Appeal.
The judgement of the Italian United Sections is important because it has definitively confirmed, consistently with the European uniform trend, that the place of delivery is the only autonomous linking factor to be applied to all claims grounded on contracts for the sale of goods and not only to claims based on the non-performance of the delivery obligation itself.
The author of this article is Silvia Petruzzino.
A crucial clause in international contracts is the one which deals with litigation.
My advice, since we have seen that negotiation can be pretty long, complicated, and, exhausting, is that such clauses should not be the last to be dealt with, often times late at night when parties are exhausted, but the among the first.
Generally parties argue at length on such clauses, because neither party is willing to give up on its national jurisdiction for different reasons, foremost of all the fear that foreign judges would not be impartial and treat with favor the local part.
This deadlock often leads to bad compromises, like choosing the judge of a third state or combining the jurisdiction of one state with the application of the law of the other, which is definitely not recommended.
There is no one-fits-all solution to offer here: the advice is that such clauses should be tailor made on a case by case basis, and that the choice of a state court or arbitration should be expressed taking into account where the final decision shall be enforced.
If we foresee that our client may seek payment of a price or claim damages for breach of contract, ‘where is the money’ or ‘where are the assets’ should be the driving factor, and the choice of jurisdiction should be made accordingly.
If there is no such concern, and litigation may be foreseen only or mostly in a defensive scenario, then the proximity to the money or assets is no more a priority, and other options can be evaluated: in that case, the choice of a Judge in a far away country can be the best option, as it is a strong deterrent for litigation.
When battling for a clause with domestic jurisdiction, however, one should keep in mind that the process of recognition of a foreign decision is generally a rather complicated and lengthy process, even if (as is the case of Italy and China), there is a bilateral treaty for mutual recognition of judicial decisions (but very few cases have been recognized and enforced in China thereafter); it should also be kept in mind that all documents filed with the application for recognition of the foreign decision need to be translated into mandarin, notarized and legalized, which in complex litigations can represent an unforeseen additional high cost.
In other cases, like in the USA, where there is no bilateral treaty in this field, to litigate abroad often means that the foreign decision will be almost useless, with the necessity to sue again in China to seek enforcement of the decision.
Arbitration can be a valid alternative, as China is a member of the New York Convention of 1958 and enforcement of an arbitral award is in most cases easier and faster than the process of recognition of a foreign court decision.
