EUPillar BVBA N. v BV M. - Kh. Dendermonde, 29 December 2011

Summary

The plaintiff developed pills to help with joint problems. The defendant was prepared to bring this product to market and help with production. During the negotiations, the defendant omitted to say that the necessary raw materials could only be purchased through a licensing system. In the end, the defendant was unable to deliver the necessary raw materials and the partnership did not go through. The plaintiff sues the defendant for breach of its pre-contractual obligations. It is undisputed that the obligations in question are non-contractual. Rome II entered into force on 11 January 2009. The Regulation applies to legal actions if (i) the incident giving rise to the damage occurred on or after this date, and (ii) the proceedings were initiated on or after this date. In the case at hand, these requirements are fulfilled. Art 4(1) Rome II defines the general rule to determine the law applicable to a non-contractual obligation arising out of a tort or delict: the law of the country in which the damage occurs. The Court may not disregard the other provisions of Rome II. Art 12(1) stipulates that the law applicable to a non-contractual obligation arising out of dealings prior to the conclusion of a contract, regardless of whether the contract was actually concluded or not, shall be the law that applies to the contract or that would have been applicable to it had it been entered into. This provision limits the discretion of the Court to determine the applicable law. Since the claim at hand is concerned with the “culpa in contrahendo”, the Court must determine the law that would have been applicable to the contract. This is Vienna Convention on the International Sales of Goods. The defendant invokes the choice of law clause in favour of the laws of the Netherlands included in its general terms and conditions. Since the CISG is part of Dutch law, this further strengthens the presumption that the CISG governs the contract between the parties (as opposed to internal substantive Dutch commercial law). However, the CISG does not contain any rules on pre-contractual obligations. The applicable law must therefore be determined in accordance with Rome I. The Court finds that the contractual relationship between the parties originated after 17 December 2009. However, obligations arising out of dealings prior to the conclusion of a contract are expressly excluded from the scope of the Rome I Regulation pursuant to its Art 1(2)(i). The Court considers that the Rome I refers implicitly but certainly to the Rome II which contains a specific rule on the “culpa in contrahendo” in its Art 12. Art 4(1)(a) Rome I determines that a contract for the sale of goods shall be governed by the law of the country where the seller has his habitual residence. The Court also considers that, despite the presence of several factors which connect the case to Belgium, the contract is not manifestly more closely connected with Belgium within the meaning of Art 4(3). In conclusion, the contract is governed by Dutch law. The claim for damages will be assessed under Dutch law. Critique: The Court correctly applies Rome II, except when it states that “the Rome II Regulation applies to legal actions if (i) the incident giving rise to the damage occurred on or after this date, and (ii) the proceedings were brought on or after this date.” The decision was handed down before the judgment of the ECJ of 17 November 2011 in case C-412/10, Humawoo v. GMF Assurances, where the ECJ decided that Arts. 31 and 32 Rome II Regulation “must be interpreted as requiring a national court to apply the Regulation only to events giving rise to damage occurring after 11 January 2009 and that the date on which the proceedings seeking compensation for damage were brought or the date on which the applicable law was determined by the court seised have no bearing on determining the scope ratione temporis of the Regulation.”