EUPillar C-386/05 Color Drack GmbH v Lexx International Vertriebs GmbH (First Chamber) [2007] ECR I-3699

Summary

This reference for a preliminary ruling has been submitted in the context of proceedings between Color Drack GmbH (‘Color Drack’), a company established in Schwarzach (Austria), and Lexx International Vertriebs GmbH (‘Lexx’), a company established in Nuremberg (Germany), concerning the performance of a contract for the sale of goods, under which Lexx undertook to deliver goods to various retailers of Color Drack in Austria, inter alia in the area of the registered office of Color Drack, which undertook to pay the price of those goods. The dispute concerns in particular the non-performance of the obligation to which Lexx was subject under the contract to take back unsold goods and to reimburse the price to Color Drack. By reason of that non-performance, on 10 May 2004 Color Drack brought an action for payment against Lexx before the Bezirksgericht St Johann im Pongau (Austria) within whose jurisdiction its registered office is located. That court accepted jurisdiction on the basis of the first indent of Art 5(1)(b) of Brussels I. Lexx appealed to the Landesgericht Salzburg (Austria), which set aside that judgment on the ground that the first instance court did not have jurisdiction. The appeal court took the view that a single linking place, as provided for in the first indent of Art 5(1)(b) for all claims arising from a contract for the sale of goods, could not be determined where there were several places of delivery. Color Drack appealed against the decision of the Landesgericht Salzburg, to the Oberster Gerichtshof, which considers that an interpretation of the first indent of Art 5(1)(b) is necessary in order to resolve the question of the jurisdiction of the Austrian court first seised. The referring court essentially asked whether the first indent of Art 5(1)(b) applies in the case of a sale of goods involving several places of delivery within a single Member State and, if so, whether, where the claim relates to all those deliveries, the plaintiff may sue the defendant in the court for the place of delivery of its choice. The Fourth Chamber noted that Art 5(1)(b) establishes the place of delivery as the autonomous linking factor to apply to all claims founded on one and the same contract for the sale of goods rather than merely to the claims founded on the obligation of delivery itself. It decided that the first indent of Article 5(1)(b) of Regulation No 44/2001, determining both international and local jurisdiction, seeks to unify the rules of conflict of jurisdiction and, accordingly, to designate the court having jurisdiction directly, without reference to the domestic rules of the Member States. Where there are several places of delivery of the goods, ‘place of performance’ must be understood, for the purposes of application of Art 5(1)(b), as the place with the closest linking factor between the contract and the court having jurisdiction. In such a case, the closest linking factor will, as a general rule, be at the place of the principal delivery, which must be determined on the basis of economic criteria. To that end, it is for the national court seised to determine whether it has jurisdiction in the light of the evidence submitted to it. If it is not possible to determine the principal place of delivery, each of the places of delivery has a sufficiently close link of proximity to the material elements of the dispute and, accordingly, a significant link as regards jurisdiction. In such a case, the plaintiff may sue the defendant in the court for the place of delivery of its choice on the basis of the first indent of Art 5(1)(b). However the CJEU was careful to confine its ruling to cases where all the places of delivery were in the same Member State as in this case because then the ruling does not create an unforeseeable country for the defendant to be sued in.