EUPillar C-605/14 Virpi Komu and Others v Pekka Komu and Jelena Komu (Seventh Chamber)

Summary

This case on Art 22(1) was referred to the CJEU in proceedings between the five co-owners (domiciled in Finland) of an immovable property situated in Spain concerning the termination, by way of sale, of the co-ownership in undivided shares of that property. Wishing to realise the interests that they hold in both properties, and in the absence of agreement on the termination of the relationship of co-ownership, the three co-owners brought an action in Finland for an order appointing a lawyer to sell the properties and fixing a minimum price for each of the properties. Relying on Art 22(1) of Brussels I, the other two co-owners claimed that the action was inadmissible and stated that any decision on the substance of the case by the Finnish courts would not be enforceable in Spain. The court found that it had jurisdiction and decided to uphold the action. At the appeal, it was held that the Spanish courts had jurisdiction under Art 22(1) and the judgment given at first instance was set aside and accordingly the action was dismissed as inadmissible. In a further appeal, the referring court asked the CJEU whether the action falls within Art 22(1). The CJEU recalled its case-law on Art 16(1)(a) of the Brussels Convention (in particular C 438/12 Weber and the case-law cited at para 40 therein) an independent definition must be given in EU law to the phrase ‘in proceedings which have as their object rights in rem in immovable property’. It also recalled, by citing C 343/04 ČEZ and the case-law cited at paras 26 and 27 therein, that Art 22(1) must not be given an interpretation broader than is required by its objective because it is an exception to the general jurisdiction rules in Art 2(1). Considering the Brussels I Convention and the Jenard Report, the CJEU reaffirmed that the essential reason for conferring exclusive jurisdiction on the courts of the locus rei sitae is proximity. It also recalled that this exclusive jurisdiction does not encompass all actions concerning rights in rem in immovable property, but only those which seek to determine the extent, content, ownership or possession of immovable property or the existence of other rights in rem therein and to provide the holders of those rights with protection for the powers which attach to their interest. It reaffirmed its settled case law that the difference between a right in rem and a right in personam is that the former, existing in corporeal property, has effect erga omnes, whereas the latter can be claimed only against the debtor. The CJEU observed that, in the present case, an action for termination of the co-ownership of immovable property constitutes proceedings which have as their object rights in rem in immovable property falling within the exclusive jurisdiction of the courts of the MS in which the property is situated. It stated that clearly such an action, designed to bring about the transfer of a right of ownership in immovable property, concerns rights in rem which have effect erga omnes and is intended to ensure that the holders of those rights can protect the powers attached to their interest, as supported by the considerations of sound administration of justice underlying Art 22(1). It found that in a case where the rules of substantive applicable law would involve an assessment of whether physical partition of the properties is feasible when terminating the relationship of co-ownership, such an assessment would also be capable of giving rise to checks, by means of expert reports, which the courts of the MS in which those properties are situated would be best placed to order. Thus, it held that an action for the termination of co-ownership in undivided shares of immovable property by way of sale, by an appointed agent, falls within the category of proceedings ‘which have as their object rights in rem in immovable property’ under Art 22(1). This was a straightforward case dealt with by the CJEU quickly in less than 12 months.