Bio-Medical v Delatex

• Jurisdiction: Ireland
• Judge: Fennelly J.
• Judgment Date: 21 December 2000
• Neutral Citation: [2000] IESC 32
• Court: Supreme Court
• Docket Number: [S.C. No. 122 of 1999]
• Date: 21 December 2000

[2000] IESC 32

THE SUPREME COURT

Keane C.J.

Murray J.

Fennelly J.

No. 122/99

BIO-MEDICAL RESEARCH LTD T/A SLENDERSTONE v. DELATEX SA

BETWEEN/

BIO-MEDICAL RESEARCH LIMITED trading as SLENDERTONE

PLAINTIFF

AND

DELATEX S.A.

DEFENDANT

Citations:

BRUSSELS CONVENTION 1968 ART 5(3)

JURISDICTION OF COURTS & ENFORCEMENT OF JUDGMENTS (EUROPEAN COMMUNITIES) ACT 1988 S3

JURISDICTION OF COURTS & ENFORCEMENT OF JUDGMENTS (EUROPEAN COMMUNITIES) ACT 1988 S2

COURTS ACT 1981 S22

RULES OF SUPERIOR COURTS (RSC) (NO 1) 1989 SI 14/1989

BRUSSELS CONVENTION 1968 ART 5(1)

JURISDICTION OF COURTS & ENFORCEMENT OF JUDGMENTS (EUROPEAN COMMUNITIES) ACT 1988 SCHED 1

BRUSSELS CONVENTION 1968 ART 17

BRUSSELS CONVENTION 1968 ART 2

BRUSSELS CONVENTION 1968 ART 3

BRUSSELS CONVENTION 1968 ART 5

BRUSSELS CONVENTION 1968 ART 16

DE BLOOS V BOUYER 1976 ECR 1497

BRUSSELS CONVENTION 1968 ART 52

BRUSSELS CONVENTION 1968 SCHED 5 PART III

JURISDICTION OF COURTS & ENFORCEMENT OF JUDGMENTS (EUROPEAN COMMUNITIES) ACT 1988 S13(2)

JURISDICTION OF COURTS & ENFORCEMENT OF JUDGMENTS (EUROPEAN COMMUNITIES) ACT 1988 S4

HANDBRIDGE LTD V BRITISH AEROSPACE COMMUNICATIONS LTD 1993 3 IR 343

MAINSCHIFFAHRTS-GENOSSENSCHAFT V LES GRAVIERES RHENANES SARL 1997 ECR 911

TESSILI V DUNLOP 1976 ECR 1473

BRUSSELS CONVENTION 1968 ART 5(2)

FARRELL V LONG 1997 ECR 1683

MEDWAY PACKAGING V MEURER 1990 2 LLOYDS REP 112

CLARE TAVERNS T/A DURTY NELLYS V GILL T/A UNIVERSAL BUSINESS SYSTEMS 2000 1 IR 286, 2000 2 ILRM 98

CONTINENTAL BANK NA V NAVIERA 1994 2 AER 540

AIMO V RUWA POLSTEREIMASCHINEN 1976 ECR 1831

CASTELLETTI V TRUMPY 1999 ECR 1597

LEATHERTEX DIVISIONE SINTETICI SPA V BODETEX BVBA 1999 ECR 6747

Synopsis:

Conflict of Laws

Jurisdiction; Brussel's Convention; contract; plaintiff company, domiciled in Ireland, had had an unwritten distribution agreement with defendant company, registered in France; plaintiffs had sent a letter in 1997 to defendants revoking any exclusivity which might have existed in the distribution agreement; plaintiff had issued proceedings in Ireland for arrears and damages six days before defendants had issued proceedings in France; whether case should be heard in Ireland or France; whether the obligation in question for the purposes of Article 5(1) of the Convention on Jurisdiction and Enforcement of Judgments in Civil and Commercial Matters, Brussels 1968, is the obligation of the defendant to distribute the plaintiff's goods, which obligation is therefore one to be performed in France where courts accordingly have jurisdiction; whether the obligation to pay is the relevant obligation for the purposes of jurisdiction in respect of the claim that the agreement was terminated; whether the relevant obligation is the obligation to give notice which is an obligation to be performed in France; whether the letter revoking exclusivity suggested that the notice was justified by any contractual term; whether the jurisdiction clause applies to the question of the exclusivity of an agreement for distribution of goods sold in France; whether there was any purpose in granting the amendment sought; s.3, Jurisdiction of Courts and Enforcement of Judgments (European Communities) Act, 1988; Section 2, Article 5(1), Convention on Jursidiction and Enforcement of Judgments in Civil and Commercial Matters, Brussels, 1968.

Held: Appeal dismissed; Irish courts have jurisdiction; leave to amend certificate on plenary summons denied.

Bio-Medical Research Limited v. Delatex - Supreme Court: Keane C.J., Murray J., Fennelly J. - 21/12/2000 - - [2000] 4 IR 307 - [2001] 2 ILRM 51

From 1990 the appellant an Irish registered company sold its products to the respondent which had an agreement to act as the appellant's distributor in France. The respondent claimed they had been appointed exclusive distributor but this was denied by the appellant. The respondent brought proceedings in France claiming damages from the appellant which already had issued proceedings in Ireland in respect of the same subject matter. The appellant claimed the Irish courts had jurisdiction under the 1968 Convention but this was rejected by the High Court. On appeal the Supreme Court held that the interpretation of the jurisdiction clause in the agreement had to be strictly construed. None of the printed terms and conditions contained any reference to distribution, exclusive or otherwise. They had all the appearance of standard conditions regarding the sale of goods and nothing more. The appeal would be dismissed.

1 JUDGMENT delivered on the 21st day of December, 2000 by Fennelly J. [Nem diss]

2 This case concerns the application of certain provisions of the Convention on jurisdiction and the enforcement of judgments in civil and commercial matters signed at Brussels on the 17th day of September 1968 (hereinafter "the Convention") as amended by the various later Accession Conventions. The Convention has the force of law in the State by virtue of the Jurisdiction of Courts and Enforcement of Judgments (European Communities) Act, 1988. The Jurisdiction of Courts and Enforcement of Judgments Act, 1998was not in force at the date of the facts relevant to the present appeal.

3 The plaintiff, an Irish registered company, manufactures muscular electrostimulation products under the brand name, "Slendertone". It acquired, in 1990, the assets of an earlier Irish company, the original bearer of its present name. That company was placed in receivership. Its assets (excluding all distribution contracts) were sold and the plaintiff acquired them from the purchaser. That earlier company had had a trading relationship with the defendant, a French registered company. The latter distributed its products in France.

4 From 1990, the plaintiff has sold its products to the defendant. It is common case and the plaintiff accepts that there was an agreement under which the defendant acted as its distributor in France. The defendant claims that this was an exclusive distribution agreement, which is denied by the plaintiff. There is no written distribution agreement.

5 From about the year 1995, the plaintiff commenced to include with its invoices a set of printed terms and conditions of sale containing a jurisdiction clause which is central to the appeal before this Court. Between 1995 and 1997, there were discussions between the parties regarding terms of credit and payment and the level of sales. Ultimately, disputes occurred and the plaintiff wrote a letter to the defendant on 14th October 1997 as follows:

"Dear Mme Chouchana"

6 The business relationship between Bio-Medical Research and Delatex is a source of serious dissatisfaction for Bio-Medical Research in terms of the discrepancy between expected and actual sales results, and Delatex's refusal to operate within the agreed financial/credit terms of the account which may require us to take further action. So while continuing to work with Delatex in the French market Bio-Medical Research intend to also do business with customers other than Delatex. Bio-Medical Research intend to commence this activity in five months time, which is the time necessary in order to carry out the selection process of other distributors.

7 We look forward to this arrangement working well for both of us in the future.

8 Yours sincerely"

9 The principal bone of contention between the parties is the defendant's claim to have been appointed exclusive distributor, in respect of which the defendant commenced proceedings in France, claiming damages from the plaintiff, before the Tribunal de Commerce (Commercial Court) of Creteil on 13th August 1998.

10 The plaintiff, however, had already issued proceedings in Ireland in respect of the same subject-matter on 7th April 1998. The plaintiff claims that the Irish courts have jurisdiction pursuant to the provisions of the Convention. This claim was rejected by Mr Justice McCracken in the High Court and the plaintiff has appealed.

11 The general Indorsement of claim on the Plenary Summons is as follows:

"THE PLAINTIFF'S CLAIM IS FOR:- "

1. A declaration that the Plaintiff is not party to an exclusive distribution agreement with the Defendant in relation to the sale and distribution of slimming products and/or services in France.

2. In the alternative, if any exclusive distribution agreement existed between the parties, which is denied, a declaration that same was effectively terminated by a letter of termination, dated 14th October, 1997, from the Plaintiff to the Defendant."

3. The sum of FF1,314,607 being the sum outstanding in respect of goods and services provided by the Plaintiff to the Defendant between 1995 and 1997 under the terms of an agreement entered into by the Plaintiff of the one part and the Defendant of the other part, which said agreement is subject to the jurisdiction of this Honourable Court.

4. Damages for breach of contract.

5. Interest pursuant to S22 Courts Act, 1981.

6. Further and or other relief.

7. Costs."

12 The Certificate required by the Rules to found jurisdiction read as follows:

"CERTIFICATE

13 Pursuant to the Rules of the Superior Courts, 1989 (Statutory Instrument No. 14 of 1989(it is hereby certified that the Court has power under the Jurisdiction of Courts and Enforcement of Judgments (European Communities) Act, 1988by virtue of Section 3 thereof and pursuant to Section 2 Article 5(3) and Article 5(1) of the Convention on Jurisdiction and Enforcement of Judgments in Civil and Commercial Matters, (Brussels 1968) as set out in the First Schedule to the aforesaid Act, to hear and determine the claim and it is further certified that no proceedings involving the same cause of action are pending between the parties in another contracting state "

14 It will be noted that Articles 5(3) and 5(1) of the Convention are there invoked. Article 5(3) relates to...