EUPillar E. and M. v. NV L. and NV F. - Rb. (beslagr.) Gent, 8 December 2009

Summary

The second defendant, NV F., is the main shareholder of the first defendant, NV L., and would like to seise full control of the company by acquiring the rest of the shares. To that end, NV F. entered into a put and call agreement with the remaining shareholders E. and M. (the plaintiffs in this case) to acquire their shares on 26 December 2001. The managing director of the NV F., Mr. R.D., personally stands surety. E. and M. exercised their put options on 3 July 2009 (the expiration date was 30 November 2011). NV F. fails to transfer the purchase price. It appears that the NV F. is in financial troubled waters, and that Mr. R.D. is internationally insolvent. The plaintiffs instruct a bailiff to make third party charging orders against NV F.’s interests in five companies, including the first defendant NV L. The plaintiffs initiated the current proceedings against L. to obtain the provisional consignment of the object of the charging order against it, i.e. a total amount of EUR 2,982,654.93. The NV F. is also joined in the proceedings to make sure the judgment against L. will also be enforceable as against F. (The plaintiffs also sued NV F. and Mr. R.D. in separate proceedings to obtain an order of sale of their interests in NV L.) The NV F. contests the international jurisdiction of the courts, since it has its seat in the Grand Duchy of Luxembourg. However, the Enforcement Judge of the Court of First Instance of Ghent accepts its jurisdiction on the basis of Art. 6(1) Brussels I and Art. 633 §1 Belgian Judicial Code. The enforcement judge decides that the claim against L. for consignment of the funds and the claim against F. for the enforceability of that decision are closely connected; and that F. was not joined in the proceedings solely with the object of depriving it from its natural national forum. The NV F. had also brought a counterclaim to prevent the consignment by challenging the allegedly wrongful third party charging orders. The enforcement judge withholds its jurisdiction on the basis of Art. 633, §1 of the Belgian Judicial Code. The distrained debtor – F. – is seated in the Grand Duchy of Luxembourg, and the place of the third party charging order (against L.) is in Zulte, in the district of Ghent, Belgium. SHORT CRITIQUE Art. 633 §1 Judicial Code provides that in case of garnishment orders, the courts of the place of the debtor's residence have jurisdiction, unless the debtor resides abroad or his place of residence is unknown. Then the court where the attachment has to be enforced has jurisdiction.