CJ Gaffney Ltd v Germanischer Lloyd SE and Others
| Jurisdiction | Ireland |
| Judge | Ms. Justice Baker |
| Judgment Date | 12 November 2015 |
| Neutral Citation | [2015] IEHC 721 |
| Court | High Court |
| Date | 12 November 2015 |
BETWEEN
AND
[2015] IEHC 721
THE HIGH COURT
Practice & Procedure – O. 12 r. 26 of the Rules of the Superior Courts – Setting aside of service of notice of plenary summons – Art. 5(3) of Council Regulation (EC) No 44/2001 (the Brussels I Regulation) – Want of Jurisdiction – Connecting factor – Onus of proof
Facts: Following the institution of the claim for negligent and fraudulent misrepresentation by the plaintiff against the defendants for issuing false stability certificate to the vessel purchased by the plaintiff and which was later found to be not suitable for fishing, the defendants now sought an order for setting aside the service of notice of plenary summons on the ground that the appropriate forum to litigate the present forum was Netherlands being the place of purchase of the vessel. The plaintiff claimed that the Irish Courts had jurisdiction to hear the matter pursuant to art. 5(3) of Council Regulation (EC) No 44/2001 (the Brussels I Regulation). The second named defendant claimed immunity on the ground of exercise of public powers by virtue of art. 1 (1) of the Brussels I Regulation.
Ms. Justice Baker granted an order for setting aside the service of notice of plenary summons. The Court, in consonance with Casey t/a Casey International Plant Sales and Hire v. Ingersoll-Rand Sales Company Ltd [1997] 2 IR, held that the place of jurisdiction in misrepresentation claims must be the place where the misrepresentation was received. The Court held that there must be a causative nexus between the alleged misrepresentations and the decision to enter into the contract. The Court found that the place of domicile or business or financial loss caused to the plaintiff would not be determinative of the place of jurisdiction. The Court found that since the stability certificates in relation to the purchase of the vehicles were acquired by the plaintiff in Netherland before entering into the contract to purchase the vehicles, the place of jurisdiction could either be Netherland or Germany. The Court held that the subsequent damage caused to the plaintiff in Ireland had no direct and immediate connection with the allege defect of the vessel.
1. The defendants bring this motion pursuant to O. 12 r. 26 of the Rules of the Superior Courts setting aside service of the notice of the plenary summons for want of jurisdiction. This case raises the question of where the plaintiff may properly bring proceedings against the defendants arising from the purchase by the plaintiff of a shipping vessel purchased in the Netherlands in 2007, and which, it is claimed, is not suitable for fishing in Irish waters.
2. The plaintiff is a small family-owned limited liability company which carries on the business of fishing. For the purposes of that business in September 2007 it purchased in the Netherlands the motor fishing vessel Mary Kate (then named Everetjan), offered for sale through a Dutch broker. It was always intended that the vessel would be used to fish in Irish waters, or that the fish would be landed in an Irish port. The vessel was reflagged under the Irish flag. The plaintiff says that the vessel performed poorly in heavy beam seas, and almost capsized once in shallow fishing waters. The plaintiff sought to have the stability values of the vessel tested under a newly-introduced national testing mechanism and results of the inclining test furnished to the plaintiff in 2009 have shown that the stability values of the vessel are such that the vessel could not lawfully be fished. Certain stabilization works were carried out to the vessel at significant cost but the plaintiff alleges that the now stable vessel is not capable of being used to supply the Irish fish market as a result of its physical proportions and new quota requirements.
3. The plaintiff issued notice of plenary summons on the defendants on the 15 th November, 2013 and each of the defendants entered a conditional appearance solely for the purpose of contesting jurisdiction. The defendants jointly bring the motion to set aside the plenary summons for want of jurisdiction.
4. The first defendant is a limited company incorporated under the laws of Germany, and carries out the business of, inter alia, the surveying of vessels and the certification of compliance of such vessels with certain technical standards.
5. The second defendant is a corporation also incorporated pursuant to the laws of Germany, and carries out the business of, inter alia, the supervision of the construction of sea-going vessels and their compliance and conformity with certain standards.
6. The hull of the fishing vessel is of a type known as a "Euro-cutter" and was sold to a shipyard in the Netherlands for fitting out and onward sale. The hull was launched under the German flag and fitted out and completed in Germany under the supervision of a German naval architect.
7. For the purpose of the initial registration of the vessel, inclining tests in accordance with the technical standards of the second defendant were carried out, and these were supervised by the first and second defendants. The vessel was issued with a certificate of stability by which it was certified that the vessel had certain stability characteristics and that it complied with German and EU stability requirements for fishing vessels. Compliance with such standards is a condition precedent for any fishing vessel to fish in the European Union.
8. The claim is made against each defendant that they, and each of them, by the endorsement on the stability certificate in September 1992 and November 1992 warranted and represented that they had supervised, inspected and approved the stability figures, but that the stability characteristics contained in the certificate were not correct. The plaintiff pleads that in making the decision to purchase the vessel it relied on the stability values and characteristics disclosed in the stability certificate and/or the warranties and representations made by the defendants and each of them therein contained.
9. It is specifically pleaded that the plaintiffs would not have purchased the vessel had the stability characteristics of same been properly represented by the aforesaid certificate.
10. The claim is made in negligent and fraudulent misrepresentation.
11. The plaintiff says that it was not until May 2009, when the plaintiff caused the vessel to be subjected to an inclining test in Ireland, and in anticipation of changing regulatory requirements relating to stability, that it learnt that the vessel did not have the stability values disclosed in the certificate, and that the certification made by each of the defendants was false.
12. The plaintiff claims that the Irish courts have jurisdiction to hear and determine the claim by virtue of Article 5(3) of Council Regulation (EC) No 44/2001 on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters, the Brussels I Regulation, and the plenary summons and statement of claim both contain the mandatory endorsement pursuant to O. 9 r. 3(a) of the Rules of the Superior Courts.
13. The material scope of the Regulation is dealt with in Article I which provides as follows:
"This Regulation shall apply in civil and commercial matters whatever the nature of the court or tribunal. It shall not extend, in particular, to revenue, customs or administrative matters."
Article 5 is a rule of special jurisdiction and the relevant provision is Article 5(3) which confers special jurisdiction in matters of tort, such that a person may sue in "the place where the harmful event occurred". It provides as follows:
"in matters relating to tort, delict or quasi-delict, in the courts for the place where the harmful event occurred or may occur".
14. The defendants claim that the Irish courts do not have jurisdiction on two grounds: that the claim is not a civil or commercial claim for the purposes of the Regulation; and that the harmful event, if there was one, occurred either in Germany where the certification was done, or in the Netherlands where the contract to purchase the vessel was made.
15. The defendants argue that the second defendant was acting as a public authority in the exercise of public law functions, namely the classification of seagoing vessels to ensure compliance with German and/or European law. The grounding affidavit of Helen Noble, the solicitor for the defendants, avers that each of the two defendants has their registered office in Germany and that she is instructed that the second defendant is a "public German authority" and not a private corporation, and that employees of the second defendant are civil servants. She avers that in exercising the duties of certification the second defendant was "exercising public duties of a public authority". She exhibits a translation of an extract from the Federal Maritime Responsibilities Act of 24 th May, 1965, and pointed to the fact that s. 6(3) of that Act specifically provided that the second defendant "performed the tasks of the Federal Government".
16. In the course of argument the plaintiff made the point, which I accept, that no evidence of foreign law was brought before me for the purposes of the application, that no authenticated version of the German legislation was provided, that there is no admissible evidence before me on which I can make a determination as to the status of the second defendant as a public authority. Not only is the exhibited...
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