Summary
The defendant was appointed as a consultant of WPP Italy, WPP 2005. The agreement was terminated by WPP Italy. WPP Italy initiated proceedings in England seeking contractual damages and declaration the defendant was not an employee.
The defendant challenged the English court’s jurisdiction, requesting a stay of the English proceedings. It should be noted that there were parallel proceedings in Italy. The defendant in the English proceedings was a claimant in Italian proceedings which were brought in Italy with regard to the same contractual relationship. The questions of the time of seizure of the two courts had to be considered.
Another important issue was whether Mr Benatti was an employee within the meaning of Articles 18 – 20 of Brussels I.
On 18th July 2006, the English High Court held that the English proceedings should not be stayed as the English court was the first seised. Jurisdiction was established in England on the ground of Article 23 of Brussels I. In this context, Mr Justice Field held:
“53 […] The writ in the first set of Italian proceedings was therefore not served in accordance with the Service Regulation and it follows that the Italian courts were not first seised of the causes of action asserted by and against WPP 2005.
[…]
69 I take from these decisions that the objective criteria of an employment contract for the purposes of Section 5 of the Judgments Regulation are: (i) the provision of services by one party over a period of time for which remuneration is paid; (ii) control and direction over the provision of the services by the counterparty; and (iii) integration to some extent of the provider of the services within the organizational framework of the counterparty. In applying these broad criteria I think regard must be had particularly to the terms of the contract; the conduct of the parties is relevant too. Further, in recognition of the fact that the exercise is one of fact and degree and quite different relationships may share to a considerable extent some of the criteria, the court should use as reference points a paradigm of a contract of employment (eg a contract under which a clerk works full time in an office) and a paradigm of a contract for services (eg contract under which an architect agrees to design a number of houses as in Shenavai ). The court should also keep in mind the underlying policy of Section 5 — the protection of parties to a contract who are weaker from a socio-economic point of view than the other party.
[…]
100 In the event, therefore, I find that the argument that the Agreement was not an individual employment contract for the purposes of Section 5 of the Judgments Regulation is much better on the material before me than the argument to the contrary. Accordingly, I hold that WPP Italy has established jurisdiction under Article 23 for its claims for breach of the Agreement.” [53, 69 and 100]
Following an appeal by the defendant, the English court concluded that Italian court was first seised of the cause of action between WPP 2005 and the defendant. However, the defendant’s appeal was dismissed in relation to WPP Italy and BSH.