Summary
The claimant, Integral, was a Swiss company. The defendant, SCU-Finanz, was also a Swiss company. The value of the claim was for sum of over $1 million.
The jurisdiction was assumed on the basis of an English jurisdiction clause.
The claim form was issued on 11th Feb 2013; served on 21st March 2013. A judgment in default of defence was rendered for the claimants on 17th July 2013.
An application for the judgment to be set aside was made by the defendant.
The application was upheld by the High Court. An important issue was which law governs the issue as to whether the parties had expressed their will to be legally bound. Mr Justice Popplewell held:
“64 For these reasons the issue in this case of whether SCU-Finanz is bound by a contract which is signed by only one of the two prokurists appointed by the company is governed by the law of the company's constitution, Swiss law. That is the relevant rule of attribution which is engaged. Swiss law answers the question in the negative. Accordingly SCU-Finanz has what is, on the current evidence, a complete defence to the claim.” [64]
The appeal was dismissed by the Court of Appeal. In this context, it was considered whether the Rome I Regulation was applicable at all. Lord Justice Floyd held:
“45 In the present case the absence of the signature of Mr Bass cannot be regarded as going only to formal validity. A sole prokurist has no actual authority to bind the company. It cannot be assumed that the second prokurist would be prepared to sign. By contrast it can, for example, be assumed that a person would be able to obtain a witness to his or her signature, or sign again in a second place.
46 However, even if that interpretation of “formal validity” is incorrect, and formal validity has the wider meaning for which Mr Cogley contends, then I consider that Article 1(2) of the Rome I Regulation still excludes the present issue from the scope of the Regulation. Article 1(2) carves out of the Rome I Regulation a class of issues which includes the issue in this case. I cannot accept Mr Cogley's submission that these exclusionary provisions are merely declaratory, so that if the issue can be brought within one of the substantive Articles of the Regulation, then the exclusion has no effect. The matters referred to in 1(2)(f) were apparently excluded from the Regulation because of work being done on harmonisation of substantive law: see Dicey at 30–029. Thus even if the ability of Ms Vartanyan's sole signature to bind the company could be brought within Article 11 , it would in my judgment be excluded by Article 1(2)(f) and/or (g) .
47 I have not overlooked Mr Cogley's submission that it is uncommercial to require parties who have made a choice of law to look to, and have in mind, the detailed requirements of a foreign law to see whether a contract which appears to have the attributes of a concluded contract is entered into with the authority of one of the parties. However, apart from the 2009 Regulations to which I will have to come shortly, Mr Cogley does not offer us any route to a more convenient result than Article 11 of the Rome I Regulation . It is simply not possible to read that Article as extending to an issue of whether an officer or agent is authorised to act on behalf of a company, and, even if it were, Article 1(2) has expressly excluded such an issue from its scope.
48 I do not think that Article 20 of Rome I, the exclusion of renvoi , assists here either. The effect of Article 20 , in a case where the Rome I Regulation prescribes the law which governs the substance of the contract, is that English law will apply without its own, domestic rules of private international law. Where the Rome I Regulation does not apply, or does not prescribe English law, then we have no choice but to apply our own rules of private international law.” [45-48]