Archive for the ‘EC Regulation 44/2001’ Tag

Jurisdiction in product liability cases in Europe

Kainz/Pantherwerke ECJ C-45/13 of 16 January 2014: interpretation of article 5 (3) of Brussel I in product liability cases 

According to article 2 and article 5 (3) of Regulation no. 44/2001 (Brussel 1) in product liability cases the defendant may be sued in the place where he is domiciled as well as in which the event giving rise to liability occurs. It is settled case law that in case the place where the event occurs and the place where that event results in damage are not identical article 5(3) must be understood as being intended to cover both the place where the damage occurred and the place of the event giving rise to it (see also ECJEU C-189 Zuid Chemie [2009]  and C-170/12 Pinckney [2013] ) This means that the defendant may be sued, at the option of the claimant in the court of those places.

Usually it is clear what the place is where the damage occurs. There can however be a discussion about the place of the event giving rise to the damage. Is that the place where the manufacturer is established, the place where the product is put into circulation or the place where the product was acquired.

In the case of Kainz vs Pantherwerke the European Court of Justice was asked to clarify the concept of place of the event giving rise to damage in relation to product liability.

Mr Kainz who lives in Salzburg (Austria ) had an accident in Germany while biking on a bike manufactured by Panterwerke AG in Germany but purchased by a retailer in Austria. Pantherwerke AG has a registered office in Austria. According to Kainz he fell from his bike because the fork end detached itself from the fork wheel. He claimed the Pantherwerke AG was liable as manufacturer in respect to a manufacturing defect. Kainz issued proceedings before the court in Austria,

Pantherwerke AG contested the international jurisdiction of the Austrian Courts. The place of the event giving rise to the damage, in their view was located in Germany. The bicycle was manufactured in Germany and was brought into circulation in that State when it was dispatched from that company’s place of business.

Both in first instance as well as on appeal the courts dismissed the action brought by Kainz on the grounds of lack of international jurisdiction. The Obester Gerichtshof (Supreme Court) considered it necessary to ask the European Court of Justice to clarify the concept of the event giving rise to damage in product liability cases.

The European Court ruled, in line with the Zuid Chemie case,  that this is the place where the event which damaged the product took place. This is in principle the place where the product is manufactured. The courts in that place will also be in best position to rule on the finding that a product is defective.

This means that in cases where a manufacturer faces a claim of liability the place of the event giving rise to damage is the place where the product in question was manufactured. A defendant in a product liability case may thus be sued in the court where the damage took place, the place where the product was manufactured and the place where he is domiciled.

The verdict can be found here

Extension Powers Claim Representatives in International Traffic Cases

English: Courtroom at the European Court of Ju...

 Courtroom at the European Court of Justice  (Photo credit: Wikipedia)

 

In international traffic cases in Europe involving Dutch vehicles loss and damage may be claimed from the representative of the foreign liability insurer in the Netherlands (claims representative) under Directive 2009/103 (the fifth Motor Liability Insurance Directive). The claims representative will settle the loss further to applicable law.

 

Although most cases are settled, some call for litigation. In that case there are several options. Under Brussels I  (EC Regulation 44/2001) a person sustaining damage can sue the insurer of the liability party in the country where the liable party resides, where the insurer has its registered office, in the country in which the accident happened or in the country where the victim resides.

 

So far the writ of summons was served through the competent authorities at the office of the insurer established abroad. Service abroad takes time and money. Service at the office of the claims representative is not possible as the adjuster is usually not authorized to take receipt of services and notifications. See, for instance, Court of Rotterdam, 23 September 2009, JA 2010,12.

 

A recent ruling of the European Court of Justice of 10 October 2013, C-306/12 (Spedition Welter/Avanssur) changed this.  The Court of Justice held that the writ of summons can also be served at the office of the insurer’s representative.

 

The case concerned a traffic accident that occurred near Paris on 24 June 2011, in which a lorry was involved of Spedition Welter, established in Germany. The French vehicle causing the accident was insured with the motor insurance liability insurer Avanssur established in France. Spedition Welter went to court to claim compensation. The writ of summons, however, was not served on Avanssur in France but on the representative designated by Avanssur in Germany, AXA Versicherungs AG (hereinafter: ‘AXA’).

 

The court in first instance held that the claim was inadmissible as the writ of summons had not been lawfully served on AXA as the latter was not authorised to take receipt of services and notifications.
Spedition Welter filed appeal with the Landgericht Saarbrücken. According to the Landgericht admissibility was decided by the interpretation of Article 21.5 of the Motor Insurance Liability Directive. For that reason the Landgericht submitted the case to the European Court of Justice.

 

Article 21.5 of the Directive says, in summary, that  claims representatives should possess sufficient powers to represent the foreign insurer and meet claims in full.  The article does not define the extent of those powers.

 

The European Court of Justice puts first and foremost that in determining the scope of an article its wording, context and objectives should be considered.  The objective of the Directive was to make it easier for victims of accidents to take action and to enable them to file claims in their own languages and countries.  The preamble to the Directive (paragraph 37) shows that Member States should ensure that claims representatives have adequate powers to represent the insurance undertaking in relation to persons suffering damage, before national authorities including the courts, insofar as this is compatible with the rules of private international law on the conferral of jurisdiction.

 

The European Court of Justice therefore reached the conclusion that Article 21.5 of the Directive should be interpreted to mean that the powers of the claims representative include taking receipt of court documents required to file a claim with the competent court.

 

This implies that in international traffic accidents in which the fifth Directive applies Dutch victims deciding to litigate in the Netherlands can now simply serve the writ of summons against the foreign insurer at the office of the Dutch claims representative.  For Dutch representatives this means an extension of their powers.