EUPillar KG Berlin, 10.3. 2010

Summary

The plaintiff, a legal entity of public law based in Germany that provides local public passenger transport services, argues over the legal effectiveness of an agreement about a Collaterized Debt Obligation with the defendant, an international banking and financial institution based in the US. The defendant filed an action concerning the same legal relationship in London, the place of jurisdiction the parties had agreed upon. In the opinion of the Appelate Court of Berlin and the previous instance a lis pendens is given. It submits the following questions to the CJEU. „1.Does the scope of Article 22(2) of [Regulation No 44/2001] also extend to proceedings in which a company or legal person objects, with regard to a claim made against it stemming from a legal transaction, that decisions of its organs which led to the conclusion of the legal transaction are ineffective as a result of infringements of its statutes? 2.If the [first question] is answered in the affirmative, is Article 22(2) of Regulation No 44/2001 also applicable to legal persons governed by public law in so far as the effectiveness of the decisions of its organs is to be reviewed by civil courts? 3.If the [second question] is answered in the affirmative, is the court of the Member State last seised in legal proceedings required to stay the proceedings pursuant to Article 27 of Regulation No 44/2001 even if it is claimed that, because a decision of the organs of one of the parties is ineffective under its statutes, an agreement conferring jurisdiction is likewise ineffective?“ [excerpt of C-144/10] In its answer (C-144/10) the CJEU points out that the wording of Art. 22.2 Brussels I differs among the language versions of the provision. Yet it has to be interpreted uniformly. The interpretation of Art. 22.2 Brussels I has to be narrow and therefore its scope has to be limited to cases where the validity of organ decisions is the primary issue. In the present case of a dispute concerning a contract relation the question of the organs decision’s validity is of accessory nature. In order to ensure legal certainty and foreseeable rulings Art. 22.2 Brussels I should not be applied. The CJEU answered the first question in the negative. Therefore the answers to the following questions become obsolete. In the German literature it is unanimously stated that Art. 22.2 Brussels I has to be interpreted narrowly and its scope should not include 'preliminary issues'. The literature bases its opinion on the CJEU’s case C-372/07 where the court stipulated clearly in point 19 and seq. that in the case of a broad interpretation all actions in a loose connection with a decision of a company organ would have to be brought before the court at the company’s headquarter. Clearly, this can’t be the desired result of the application of Art. 22.2 Brussels I.