EUPillar NV P.H.S. and NV A. v. P.B. - Joined cases A/07/01920 and A/08/00189

Summary

On 24 December 2003, the defendant, Mr. B., sold, together with the other shareholders, all of the shares of the aluminium company NV A. to the company NV F, which is held by a British-German private equity fund, Cognetas. In the share purchase agreement, Mr. B. signs a non-compete clause for a 3-year period. Mr. B. also acquires a 15% share in the holding company of A. Ltd. On 19 December 2006, the shareholders of A. Ltd sell all of their shares to the French company P.S., which is held by a French private equity fund. A. Ltd’s biggest shareholder was the Cognetas Fund, which held 70% of the shares, with Mr. B. being the second-largest shareholder. In 2007, Mr. B. becomes active again in the aluminium sector. By letter of 14 May 2007, P.S. and NV A. (the claimants) request Mr. B. to stop his activities because they are allegedly in breach of his contractual and legal obligations. P.S. argues that Mr. B. committed a culpa in contrahendo by failing to disclose during the sale of 19 December 2006, that he intended to launch a new business in the aluminium sector. The second claimant, NV A., argues that Mr. B. is in breach of provisions of the Belgian Act of 14 July 1991 on commercial practices and the provision of information to and the protection of consumers. They claim 100 million and 30 million EUR respectively. - Mr. B. contests the jurisdiction of the court over P.S.’s claim. The share purchase agreement of 19 December 2006 provides that any claim and any dispute arising from or related to the present agreement or its conclusion will be heard and settled exclusively by the courts and tribunals of England. That choice of court clause concerns any dispute that is related to the agreement of 19 December 2006. The text of the clause is comprehensive, and encompasses a dispute related to an alleged precontractual breach. In the light of Art. 23 Brussels I, the clause is not too large: it is concerned only with the present agreement and does not extend to other or future agreements between the parties. The choice of court clause is valid. The Court lacks jurisdiction. The question whether precontractual liability falls under Art. 5(1) or 5(3) Brussels I is therefore irrelevant. These notions must receive an autonomous interpretation, and that goes also for the notion of precontractual liability itself. Precontractual liability will only fall within the scope of Art. 5(3) if it is not related to an obligation arising out of a contract. - Mr. B. contests both the international and territorial jurisdiction of the court. Mr. B. refers to an arbitration clause included in the agreement of 24 December 2003. That clause provides that all disputes related to the agreement will be settled exclusively by three arbitrators. However, the claim of NV A. as described in the document instituting the proceedings is not based on the agreement of 24 December 2003, but on certain provisions of the Belgian Trade Practices and Consumer Information and Protection Act. It is in vain that Mr. B. contests the international jurisdiction of the court. However, Mr. B. is not a trader. Therefore it is not the Commercial Court, but the Court of First Instance of Dendermonde which has jurisdiction. CRITIQUE It is commendable that the court analyses the terms of the choice of court clause and arbitration clause, to decide whether or not the present dispute is governed by those clauses. The Court applies Art. 23 Brussels I, but does not say which subparagraph, although it is clear from the context that this is an agreement in writing within the meaning of art. 23(1)(a). The Court briefly addresses the issue of the characterisation of the culpa in contrahendo – is it a matter relating to contract or to tort? – even though it strictly speaking does not have to, since it finds the choice of court clause is valid. The court does not mention Tacconi (C-334/00), where it was established that the culpa in contrahendo falls within the scope of art. 5(3).