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England and Wales High Court (Commercial Court) Decisions
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Cite as:  EWHC 2150 (Comm)
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QUEEN'S BENCH DIVISION
Royal Courts of Justice
Rolls Building, Fetter Lane,
London, EC4A 1NL
B e f o r e :
(Sitting as a Judge of the High Court):
| Claim No. CL-2019-000410
|WECO PROJECTS APS
- and –
|(1) MR. PIER LUIGI LORO PIANA
(2) CREDEM LEASING SPA
(3) PETERS AND MAY LIMITED
|Defendants / Part 20 Defendants
Defendant / Part 20 Claimant
|Case No: CL 2019 000583
|PETERS & MAY S.R.L
| - and -
1) MR. PIER LUIGI LORO PIANA
2) CREDIM LEASING SPA
John Russell QC and Andrew Leung (instructed by Campbell Johnston Clark) for the Claimant in CL-2019-410
Michael McParland QC and Tim Marland (instructed by Kennedys Law LLP) for the (Third Defendant in CL-2019-410) and (Claimant in CL-2019-00583)
Hearing dates: 1 and 2 July 2020
Crown Copyright ©
Christopher Hancock QC:
The contracts and the casualty.
(1) The booking note itself contained a jurisdiction agreement ("the EJC"), which provided as follows:
"3. Law and Jurisdiction.
This Booking Note shall be governed by and construed in accordance with the laws of England and all disputes and claims arising out of or in connection with this Booking Note shall be referred to and determined exclusively by the English High Court"
"17. Exemptions and immunities of all servants and agents of the Company.
It is hereby expressly agreed that no servant or agent of the Company (including every independent contractor from time to time employed by the Company) shall in any circumstances whatsoever be under any liability whatsoever to the Merchant for any loss, damage or delay arising or resulting directly or in-directly from any act, neglect or default on his part while acting in the course of or in connection with his employment and, but without prejudice to the generality of the foregoing provisions in this clause, every exemption from liability, limitation, condition and liberty herein contained and every right, exemption from liability, defence and immunity of whatsoever nature applicable to the Company or to which the Company is entitled hereunder shall also be available and shall extend to protect every such servant or agent of the Company acting as aforesaid and for the purpose of all the foregoing provisions of this clause the Company is or shall be deemed to be acting as agent or trustee on behalf of and for the benefit of all persons who are or might be his servants or agents from time to time (including independent contractors as aforesaid) and all such persons shall to this extent be or be deemed to be parties to the agreement evidenced by this Booking Note."
"JURISDICTION AND LAW.
28. These conditions and any act or contract to which they apply shall be governed by English law and any dispute arising out of any act or contract to which these Conditions apply shall be subject to the exclusive jurisdiction of the English Court."
"3 Law and Jurisdiction.
Disputes arising under this Sea Waybill shall be determined by the courts and in accordance with the law at the place where the carrier has his principal place of business"
The various sets of proceedings.
(1) Preliminary matters (paragraphs 20 to 25)
(2) The position as between PML and Mr Loro Piana (paragraphs 26 to 111)
(3) The position as between Weco and Mr Loro Piana (paragraphs 112 to 172)
(4) The position as between PMS and Mr Loro Piana (paragraphs 173 to 192)
(5) The position of Credem (paragraphs 193 to 198)
(6) Summary of conclusions (paragraph 199 to 200)
1. If the parties, regardless of their domicile, have agreed that a court or the courts of a Member State are to have jurisdiction to settle any disputes which have arisen or which may arise in connection with a particular legal relationship, that court or those courts shall have jurisdiction, unless the agreement is null and void as to its substantive validity under the law of that Member State. Such jurisdiction shall be exclusive unless the parties have agreed otherwise. The agreement conferring jurisdiction shall be either:
(a) in writing or evidenced in writing;
(b) in a form which accords with practices which the parties have established between themselves; or
(c) in international trade or commerce, in a form which accords with a usage of which the parties are or ought to have been aware and which in such trade or commerce is widely known to, and regularly observed by, parties to contracts of the type involved in the particular trade or commerce concerned.
2. Any communication by electronic means which provides a durable record of the agreement shall be equivalent to 'writing'.
3. The court or courts of a Member State on which a trust instrument has conferred jurisdiction shall have exclusive jurisdiction in any proceedings brought against a settlor, trustee or beneficiary, if relations between those persons or their rights or obligations under the trust are involved.
4. Agreements or provisions of a trust instrument conferring jurisdiction shall have no legal force if they are contrary to Articles 15, 19 or 23, or if the courts whose jurisdiction they purport to exclude have exclusive jurisdiction by virtue of Article 24.
5. An agreement conferring jurisdiction which forms part of a contract shall be treated as an agreement independent of the other terms of the contract.
The validity of the agreement conferring jurisdiction cannot be contested solely on the ground that the contract is not valid.
1. Without prejudice to Article 31(2), where proceedings involving the same cause of action and between the same parties are brought in the courts of different Member States, any court other than the court first seised shall of its own motion stay its proceedings until such time as the jurisdiction of the court first seised is established.
2. In cases referred to in paragraph 1, upon request by a court seised of the dispute, any other court seised shall without delay inform the former court of the date when it was seised in accordance with Article 32.
3. Where the jurisdiction of the court first seised is established, any court other than the court first seised shall decline jurisdiction in favour of that court….
1. Where actions come within the exclusive jurisdiction of several courts, any court other than the court first seised shall decline jurisdiction in favour of that court.
2. Without prejudice to Article 26, where a court of a Member State on which an agreement as referred to in Article 25 confers exclusive jurisdiction is seised, any court of another Member State shall stay the proceedings until such time as the court seised on the basis of the agreement declares that it has no jurisdiction under the agreement.
3. Where the court designated in the agreement has established jurisdiction in accordance with the agreement, any court of another Member State shall decline jurisdiction in favour of that court.
4 Paragraphs 2 and 3 shall not apply to matters referred to in Sections 3, 4 or 5 where the policyholder, the insured, a beneficiary of the insurance contract, the injured party, the consumer or the employee is the claimant and the agreement is not valid under a provision contained within those Sections.
(7) The Milan Court is first seised of the dispute between Mr Loro Piana and PML and PMS.
(8) However, both PML and PMS contend that they are parties to a jurisdiction agreement (the EJC) which is valid under the Regulation and which is not invalidated under Sections 3, 4 or 5, nor invalid under the national law applicable to that jurisdiction agreement – here English law.
(9) Until this Court determines whether that exclusive jurisdiction clause is valid, then the Milan Court is obliged to stay its proceedings.
(10) If this Court determines that the exclusive jurisdiction clause is valid, then the Milan Court must decline jurisdiction.
(11) Conversely, if this Court determines that the exclusive jurisdiction clause is invalid, and that, therefore, this Court does not have jurisdiction under the contract, then the Milan proceedings may continue.
"This is, accordingly, a case in which the fact on which jurisdiction depends is also likely to be decisive of the action itself if it proceeds. For the purpose of determining an issue about jurisdiction, the traditional test has been whether the claimant had 'the better of the argument' on the facts going to jurisdiction. In Brownlie v Four Seasons Holdings Inc  1 WLR 192 , para 7, this court reformulated the effect of that test as follows: '(i) that the claimant must supply a plausible evidential basis for the application of a relevant jurisdictional gateway; (ii) that if there is an issue of fact about it, or some other reason for doubting whether it applies, the court must take a view on the material available if it can reliably do so; but (iii) the nature of the issue and the limitations of the material available at the interlocutory stage may be such that no reliable assessment can be made, in which case there is a good arguable case for the application of the gateway if there is a plausible (albeit contested) evidential basis for it.' It is common ground that the test must be satisfied on the evidence relating to the position as at the date when the proceedings were commenced."
The position as between PML and Mr Loro Piana.
(1) The first is whether the EJC is invalidated by reason of the consumer contract provisions of the Recast Regulation.
(2) The second is whether the EJC is invalidated by reason of the provisions of the Consumer Rights Act 2015.
The consumer protection provisions of the Recast Regulation.
1. In matters relating to a contract concluded by a person, the consumer, for a purpose which can be regarded as being outside his trade or profession, jurisdiction shall be determined by this Section, without prejudice to Article 6 and point 5 of Article 7, if:
(a) it is a contract for the sale of goods on instalment credit terms;
(b) it is a contract for a loan repayable by instalments, or for any other form of credit, made to finance the sale of goods; or
(c) in all other cases, the contract has been concluded with a person who pursues commercial or professional activities in the Member State of the consumer's domicile or, by any means, directs such activities to that Member State or to several States including that Member State, and the contract falls within the scope of such activities.
2. Where a consumer enters into a contract with a party who is not domiciled in a Member State but has a branch, agency or other establishment in one of the Member States, that party shall, in disputes arising out of the operations of the branch, agency or establishment, be deemed to be domiciled in that Member State.
3. This Section shall not apply to a contract of transport other than a contract which, for an inclusive price, provides for a combination of travel and accommodation.
1. A consumer may bring proceedings against the other party to a contract either in the courts of the Member State in which that party is domiciled or, regardless of the domicile of the other party, in the courts for the place where the consumer is domiciled.
2. Proceedings may be brought against a consumer by the other party to the contract only in the courts of the Member State in which the consumer is domiciled.
3. This Article shall not affect the right to bring a counter-claim in the court in which, in accordance with this Section, the original claim is pending.
The provisions of this Section may be departed from only by an agreement:
(1) which is entered into after the dispute has arisen;
(2) which allows the consumer to bring proceedings in courts other than those indicated in this Section; or
(3) which is entered into by the consumer and the other party to the contract, both of whom are at the time of conclusion of the contract domiciled or habitually resident in the same Member State, and which confers jurisdiction on the courts of that Member State, provided that such an agreement is not contrary to the law of that Member State.
(1) Whether the booking note is a "contract of transport" within Article 17(3);
(2) Whether the First Defendant was a consumer.
Submissions on behalf of Mr Loro Piana.
(1) The Schlosser Report explains at  the reasoning behind the original introduction of this exception to the Brussels Convention: "such contracts are subject under international agreements to special sets of rules with very considerable ramifications" and their inclusion would "merely complicate the legal position". Therefore Article 17(3) was motivated not by a lack of concern for consumers entering into contracts of transport, but by a concern to avoid disrupting existing international agreements, such as the CMR Convention and the Hague-Visby Rules.
(2) The French Supreme Court has provided useful guidance in C Stein di Arnaldo Righetti v X  I.L.Pr. 17, a case concerning a contract to remove furniture. At , the Court upheld the (French) Court of Appeal's judgment that the contract was not a contract of transport under what is now Article 17(3) on the following ground:
"… if a contract for the removal of furniture, includes, indeed, a transport of goods, its object is however not limited to the transport, since it also includes the handling, and possibly the installing of the furniture, so that it could in that respect be qualified as a contract for services."
This authoritative decision under French law should be adopted in English law to ensure consistent interpretation of European law and because its implicit logic is unimpeachable: contracts for a parcel of services including transport do not raise the same concerns about disrupting international transport conventions and so the consumer should not be deprived of the protection for weaker parties underlying Section 4 (explained in Recital 18).
(3) The booking note is not a "contract of transport", having due regard to the natural meaning of the words, the purpose of Article 17(3) and the guidance in the Schlosser Report and in the Stein case:
(a) The booking note itself is a contract to arrange a contract of transport, viz. a freight forwarding agreement. In this regard, PML positively asserts in its Particulars of Part 20 Claim that the booking note required it "to arrange the carriage" of the Yacht, rather than to perform the carriage as carrier.
(b) PML is right to characterise the booking note as a contract to arrange carriage. PML is (and held itself out to be) a leading freight forwarding company that arranges the forwarding of yachts. The contract was a "Booking Note", which ordinarily precedes a contract of carriage such as a bill of lading or waybill (as happened in this case). It provided for PML to "arrange" the carriage of the Yacht (clauses 6 and 8) and the carriage itself was said to be at Mr Loro Piana's "sole risk" save for PML's "personal gross negligence" (clause 8(a)). By way of the "General Clause Paramount" (clause 2), it incorporated the British International Freight Association, the membership body for freight forwarders. It was envisaged that PML would procure a contract of carriage between Mr Loro Piana and a contracting carrier, as PML did by procuring the Waybill with Zeamarine in accordance with the terms of the contract of affreightment. By the Addendum to the booking note, PML agreed to use reasonable endeavours to secure the Vessel to carry the Yacht, reflective of its freight forwarding obligations. Thus the booking note is not properly characterised as a "contract of transport", but rather a contract to arrange carriage or a "contract for carriage".
(c) A forwarding agreement such as this is materially different from a contract of carriage. As recently held in Globalink Transportation and Logistics Worldwide LLP v DHL Project and Chartering Ltd  1 Lloyd's Rep. 630 (Nicholas Vineall QC) at : "the essential nature of the obligation [under a forwarding agreement] is not to carry, but an obligation to procure that carriage is achieved by others". Even if the forwarding agreement permits the forwarder to carry the goods, "that would not … convert the contract to arrange into a contract of carriage" . The factors that rendered the contract a forwarding agreement in Globalink, discussed at , are similar to those identified above in this case. See further Aikens' Bills of Lading, 2nd Ed. (2015) at §§2.35 & 10.92: the present case could fall within examples (i) or (ii), Scrutton on Charterparties and Bills of Lading, 24th Ed. (2019) at §4-057 and Article 47 (a booking note will typically be issued by a freight forwarder).
(d) Article 17(3) excludes "contracts of transport", not 'contracts relating to transport'. The natural meaning of this phrase is that the contract involves a carrier agreeing to carry goods or persons, not merely to arrange that transport as an intermediary. This reflects the purpose of the provision, which is to avoid conflict with international conventions that govern contracts for the transport of people and goods (e.g. the CMR, the Hague-Visby Rules, the Athens Convention). These conventions do not apply to contracts to arrange carriage and, specifically, the Hague-Visby Rules do not apply to the booking note because it was not a contract of carriage, it was not a bill of lading and did not contemplate that PML would issue a bill of lading (see Articles I and II). The contract did not even incorporate the Hague-Visby Rules.
(e) Therefore this is a clearer case than Stein because there is no transport obligation at all. However, even if the booking note could be read as including a transport element, PML had additional obligations to arrange a contract between Mr Loro Piana and the contracting carrier, including a reasonable endeavours obligation to fix the BRATTINGSBORG. There were also additional obligations on PML, including the appointment of a loadmaster, responsibility for loading and discharging the Yacht and the cradle and provision of lashing and dunnage.
"22. In the first two sentences, article 4(4) of the Rome Convention reflects the specific nature of the contract for the carriage of goods which, at least in a cross-border context, does not lend itself easily to being connected with the country of residence of the contractual party who effects the characteristic performance since the principal purpose of such a contract is the transport of goods and the carrier's habitual residence has no objective connection with that contract. Thus, the second sentence of article 4(4) of the Convention sets out an exhaustive enumeration of the connecting criteria concerning the law applicable to contracts for the carriage of goods.
23. Article 4(5) of the Convention contains an exception clause which makes it possible to disregard those presumptions when the circumstances as a whole establish that the contract is more closely connected with another country: the ICF case, para 27.
24. On the basis of those considerations and for the purposes of answering the first question from the referring court, it was appropriate to *326 examine the third sentence of article 4(4) of the Rome Convention, which states that "single voyage charter-parties and other contracts the main purpose of which is the carriage of goods shall be treated as contracts for the carriage of goods".
25. It must be remembered with regard to the expression "shall be treated as contracts for the carriage of goods" and the conditions under which another contract may be considered a contract for the carriage of goods that consistent and independent criteria are necessary in order to guarantee the full effectiveness of the Rome Convention in view of the objectives which it pursues: Koelzsch v Grand Duchy of Luxembourg (Case C-29/10)  QB 210;  ECR I-1595 , para 32 and the case law cited.
26. It should also be borne in mind that, in the ICF case  QB 411 , paras 32–34, the court interpreted the last sentence of article 4(4) as meaning that it allows other contracts to be equated with contracts for the carriage of goods, since one of the purposes of that provision is to extend the application of the second sentence of article 4(4) to contracts which, despite being categorised as charter-parties under national law, have as their principal purpose the carriage of goods. In order to ascertain that purpose, it is necessary to take into consideration the objective of the contractual relationship and, consequently, all the obligations of the party who effects the performance which is characteristic of the contract.
27. The same holds true for a commission contract for the carriage of goods which is a separate contract the characteristic performance of which consists in organising the carriage of goods. As the carriage of goods per se is not its principal purpose, a commission contract for the carriage of goods cannot be considered to be a contract for the carriage of goods.
28. However, taking account of the purpose of the contractual relationship, the actual performance effected and all of the obligations of the party who must effect the characteristic performance, and not the parties' categorisation of the contract, a commission contract for the carriage of goods may turn out to relate to the specific nature of a contract for the carriage of goods as referred to in para 22 above, if its principal purpose is the transport as such of the goods.
29. In the main proceedings, it is apparent from the order for reference that the first two contracts concluded, on the one hand, by Va Tech and Safram and, on the other, by Safram and Haeger & Schmidt, were categorised by the referring court as commission contracts for the carriage of goods. In order to have effected carriage of the transformer by inland waterway, Haeger & Schmidt concluded a contract for the carriage of goods with Mr Lorio, owner of the barge "El-Diablo", which capsized during the loading of the goods.
30. It is also apparent from the order for reference that the principal purpose of the contract concluded by Safram and Haeger & Schmidt was "the overall organisation of carriage and not simply legal representation of the contractor", with Haeger & Schmidt acting as intermediary under its own responsibility and in its own name, but on behalf of the contractor, in order to complete the tasks necessary for the carriage of the transformer in question.
31. It is for the referring court, in examining the overall circumstances of the dispute in the main proceedings, namely the contractual stipulations *327 reflecting the economic and commercial reality of the relations existing between the parties and the purpose of article 4(4) of the Rome Convention, to ascertain whether and to what extent the commission contract for the carriage of goods in question has as its principal purpose the actual carriage of the goods concerned.
32. In the light of the foregoing considerations, the answer to the first question is that the last sentence of article 4(4) of the Rome Convention must be interpreted as applying to a commission contract for the carriage of goods solely when the main purpose of the contract consists in the actual transport of the goods concerned, which is for the referring court to verify."
Submissions on behalf of PML.
(1) First, PML argued that this Court has to consider the legislative purpose of Art. 17 (3). This was explained in Pammer (C-585/08) by Advocate General Trstenjak at para.  of her Opinion, as follows:
"The purpose of art. 15(3) [now art. 17(3)] is to exclude determination of jurisdiction in accordance with the provisions on consumer contracts in the case of contracts the main purpose of which is transportation".
This was confirmed by the ECJ in ZX v Ryanair DAC (C-464/18)  1 WLR 4202, at paragraph 28, where the Court held as a result of the unambiguous wording of art. 17(3), that even though an airline passenger may be considered to be a "consumer", a passenger who "… simply purchased a ticket for a flight, rather than a travel package, cannot rely on the rules of special jurisdiction over consumer contracts contained in [Brussels (Recast)] Regulation No 1215/ 2012". This exclusion obviously applies equally to any form of transport. Therefore, the first question to ask is whether the contract in question is a "contract of transport" that is excluded under art. 17(3), because if it is, as the Ryanair case shows, it does not matter if Mr Loro Piana is otherwise a "consumer".
(2) Next, PML submitted that an independent autonomous definition is required. The Brussels Recast Regulation did not expressly define the concept of "a contract of transport other than a contract which, for an inclusive price, provides for a combination of travel and accommodation" within the meaning of Art. 17(3), nor did it refer to any national law in order to define it. In such circumstances, it was argued that the need for the uniform application of EU law and the principle of equality requires the terms of a provision of EU law which makes no express reference to the law of the Member States to determine its meaning and scope, to "be interpreted independently by reference principally to the system and objectives of the Regulation, in order to ensure that it is fully effective": Pammer (C-585/08), at paragraph 55. This is especially so where the definition of a particular concept contributes to defining the scope of a Regulation. In order, therefore, to guarantee the uniform application in all Member State of the conflict-of-laws rules for which it provides, the concept must be given an autonomous meaning, by reference to the wording of the provision, its legislative history, as well the scheme and objectives of the Regulation: see Verein fur Konsumenteninformation (C-272/18)  I.L.Pr. 44, 1118, 1134, paragraph 42 of the Attorney-General's opinion. Conversely, any interpretive arguments based on a national law interpretation of a particular concept cannot have any role in determining its meaning under the Brussels (Recast) Regulation: "That concept cannot therefore be taken to refer to classification under the relevant national law of the legal relationship in question before the national court": Ceská sporitelna as v Feichter (C-419/11)  I.L.Pr.22, at paragraph 45; Pammer ...C-585/08), paragraph 55.
(3) PML submitted that the required autonomous concept of a "contract of transport" within the meaning of art. 17(3) is a contract "… the main purpose of which is transportation", as was stated by Advocate General Trstenjak's Opinion in Pammer (C-585/08) set out above. The Court did not disagree with or qualify the Advocate-General's view.
(4) PML submitted that the end result of these legislative developments is that any contracts of transport (which do not for a fixed price, combine travel and accommodation) are now the only type of contract which are specifically excluded from the consumer contract jurisdiction provisions of both the Brussels (Recast) Regulation (see Petruchová v FIBO Group Holdings Limited (C-208/18),  I.L.Pr. 42, at paragraph 48) and the Lugano II Convention (see Pillar Securitisation Sarl v Arnadottir (C-694/17)  1 WLR 5285, at paragraph 42). That legislative exclusion should be respected.
(5) Furthermore, PML pointed out that the use of the "main purpose" test is consistent with the test used to determine whether a particular contract is "a contract for the carriage of goods" for the purposes of art. 4(4) of the Rome Convention (now art. 5(1) of the Rome Regulation (593/2008) OJ  L177/6), where those contracts whose "main purpose" is the carriage of goods are treated as contracts for the carriage of goods irrespective of national classifications: see e.g. Haeger & Schmidt, ref supra, at paragraphs 17 to 32.
(1) The booking note was the only contract that Mr Loro Piana entered into for the transport of the Yacht. Whether PML were arranging that transport or carrying it out themselves does not matter: it was still a contract whose main purpose was the transportation of the Yacht.
(2) It was the purpose of the contract that matters and not what PML's precise role in it was. It does not matter whether PML was a carrier or a freight-forwarder. There is nothing in art. 17 that requires the other party to have any particular role. Throughout art. 17 it is the purpose of the contract that is relevant and that is equally applicable to art. 17(3). If the EU legislature had not intended that to be the case they would have said so.
(3) There was no suggestion in Pammer (C-585/08) that the concept of a "contract of transport" only applies to contracts where a "carrier" agrees to carry goods or persons, or to contracts that were either subject to international conventions or raise concerns about disrupting them. If this had been the case, the ECJ would never have equated the exception with the Package Travel contracts. Mr Loro Piana is simply improperly trying to impose national law interpretations on a concept which is required to be decided independently.
(4) There were, in any event, indications in the booking note that PML was the carrier of the goods. Thus various clauses in the contract, it was argued, only make sense in the context of a contract of carriage. In this regard, PML made reference (in particular) to terms of the booking note which provided that payment was to be by way of freight; that PML were to be at liberty to carry the goods; that there were exemptions in relation to the loading and discharge of the goods; that there were rights to discharge in certain circumstances; and that the booking note contemplated that the contract that it evidenced might be subject to US COGSA.
(5) The poorly reasoned decision of the French Court De Cassation (First Civil Chamber) in C. Stein Di Arnaldo Righetti v X  I.L.Pr. 17 does not assist Mr Loro Piana.
(1) I accept PML's submission that the exclusion of contracts of transport has remained unchanged throughout the historical development of the various Conventions and Regulations, save for the introduction of the package holiday limitation on that exclusion. However, I do not think that this assists me in determining what the meaning of the phrase "contract of transport" is.
(2) I also accept that the phrase is one which must be given an autonomous meaning. In that regard, in my judgment, the definition given in Pammer is the most helpful, although the case itself is of little assistance. That was a case in which a party booked accommodation on a freighter in order to experience life on board a cargo vessel. It was, in essence, a holiday contract, although the holiday was on board a ship. In the words of the headnote to the ECJ decision:
"since the voyage by freighter at issue in the proceedings involved, for an inclusive price, accommodation and lasted for more than 24 hours, it fulfilled the necessary conditions for a "package" within the meaning of article 2(1) of Council Directive 90/314/EEC ; and that, accordingly, it fell within the definition of a contract of transport at an inclusive price for the purposes of article 15(3) of Regulation (EC) No 44/2001"
(3) The decision in Haeger v Schmidt is, in my judgment, the closest on the facts. Although that case involved the Rome Convention on the applicable law, the case did draw a clear distinction between a freight commission contract (ie a contract to arrange carriage) and a contract of carriage (ie a contract to perform carriage). In my judgment, this is clear from paragraph 27, cited above.
(4) Both PML and Mr Loro Piana submitted that the purpose of the contract had to be determined as at the time of contracting, and without reference to what in fact happened. Weco submitted, by reference to paragraph 27 of Haeger, that it was legitimate to look at how the contract was in fact performed. In my judgment, that is to read too much into the sentence in Haeger. I accept the submission that what is important is the purpose of the contract, which must be judged as at the time that it is made.
(5) I have not found either the decision in the Pammer case itself or that in the Stein case of any real assistance. Those cases involved the question of whether a contract which included both transport and other services was to be regarded as a contract of transport. Here the contract does not involve any other services ancillary to the main obligation. The question is a more stark one; is the main obligation a transport obligation at all?
(6) Nor do I think that the decision in the Globalink case is of any real assistance to me. In that case, the issue was whether the "no set-off" rule established in The Aries  1 WLR 185 could be relied on by a freight forwarder. Mr Vineall QC concluded it could not, whether the freight forwarder in fact carried the goods or not. His observations in the latter context were obiter, but of course entitled to great respect. However, the issue that he had to deal with was very different from the issue before me.
(7) I have come to the conclusion that in this case the contract is clearly a contract of transport within the exclusion to the consumer section. I reach this conclusion for the following reasons:
(a) On its face, the contract was clearly not limited to the arrangement of carriage. There was an express liberty to perform the carriage; and to subcontract the carriage. However, this liberty was contained in the BIFA terms, which were only incorporated by reference.
(b) The remuneration for the services rendered was freight, and not commission.
(c) PML chartered in a vessel to perform their obligations and paid a separate rate of freight to the shipowners.
(d) The booking note clearly contemplated that this might happen and that at least one of the statutes relating to international carriage would apply – ie the US COGSA.
(e) A large number of the provisions within the booking note contemplated that the service provider might well be providing the vessel: see, for example, clauses 4 (period of responsibility), 5 (scope of voyage), 6 (substitution of vessel, transhipment and forwarding), 8 (loading, discharging and delivery), 9 (deck cargo), 12 (lien), 13 (delay) and 15 (both to blame collision clause).
(f) Overall, therefore, in my judgment, the purpose of this booking note was indeed the transport of the Yacht.
(8) This makes it unnecessary for me to reach any concluded view as to whether a freight forwarding contract, to arrange carriage, would be a contract of transport. I would accept that Haeger suggests that such a contract would not be a contract of carriage. However, it does not seem to me to follow that the contract would not be a contract of transport. The purpose of the contract is to arrange transport of the yacht, and thus the primary purpose of the contract is transport. Unlike cases like Pammer, no other services over and above transport are being provided. In my judgment, it is probable that a freight forwarding contract is a contract of transport.
Was Mr Loro Piana a consumer?
"37. It follows that the special rules of jurisdiction in articles 13–15 of the Brussels Convention apply, in principle, only where the contract is concluded between the parties for the purpose of a use other than a trade or professional one of the relevant goods or services.
38. It is in the light of those principles that it is appropriate to examine whether and to what extent a contract such as that at issue in the main proceedings, which relates to activities of a partly professional and partly private nature, may be covered by the special rules of jurisdiction laid down in articles 13–15.
39. In that regard, it is already clearly apparent from the purpose of articles 13–15, namely, properly to protect the person who is presumed to be in a weaker position than the other party to the contract, that the benefit of those provisions cannot, as a matter of principle, be relied on by a person who concludes a contract for a purpose which is partly concerned with his trade or profession and is therefore only partly outside it. It would be otherwise only if the link between the contract and the trade or profession of the person concerned was so slight as to be marginal and, therefore, had only a negligible role in the context of the supply in respect of which the contract was concluded, considered in its entirety.
40. As the Advocate General stated in paras 40 and 41 of his opinion, in as much as a contract is entered into for the person's trade or professional purposes, he must be deemed to be on an equal footing with the other party to the contract, so that the special protection reserved by the Brussels Convention for consumers is not justified in such a case.
41. That is in no way altered by the fact that the contract at issue also has a private purpose, and it remains relevant whatever the relationship between the private and professional use of the goods or service concerned, and even though the private use is predominant, as long as the proportion of the professional usage is not negligible.
42. Accordingly, where a contract has a dual purpose, it is not necessary that the purpose of the goods or services for professional purposes be predominant for articles 13–15 of the Convention not to be applicable.
43. That interpretation is supported by the fact that the definition of the notion of consumer in the first paragraph of article 13 is worded in clearly restrictive terms, using a negative turn of phrase ("contract concluded ... for a purpose ... outside [the] trade or profession"). Moreover, the definition of a contract concluded by a consumer must be strictly interpreted as it constitutes a derogation from the basic rule of jurisdiction laid down in the first paragraph of article 2, and confers exceptional jurisdiction on the courts of the claimant's domicile: see paras 32 and 33 of the present judgment.
44. That interpretation is also dictated by the fact that classification of the contract can only be based on an overall assessment of it, since the court has held on many occasions that avoidance of multiplication of bases of jurisdiction as regards the same legal relationship is one of the main objectives of the Brussels Convention : see to that effect, in particular, Besix SA v Wasserreinigungsbau Alfred Kretzschmar GmbH & Co KG (Wabag) (Case C-256/00)  1 WLR 1113 , 1131, para 27; Proceedings brought by Gabriel (Case C-96/00)  ECR I-6367 , 6404, para 57, and Danmarks Rederiforening (acting for DFDS Torline A/S) v LO Landsorganisationen i Sverige (acting for SEKO Sjöfolk Facket för Service och Kommunikation) (Case C-18/02)  ECR I-1417 , 1452, para 26.
45. An interpretation which denies the capacity of consumer, within the meaning of the first paragraph of article 13 of the Brussels Convention , if the link between the purpose for which the goods or services are used and the trade or profession of the person concerned is not negligible, is also that which is most consistent with the requirements of legal certainty and the requirement that a potential defendant should be able to know in advance the court before which he may be sued, which constitute the foundation of that Convention: see in particular Besix , paras 24-26.
46. Having regard to the normal rules on the burden of proof, it is for the person wishing to rely on articles 13–15 to show that in a contract with a dual purpose the business use is only negligible, the opponent being entitled to adduce evidence to the contrary.
47. In the light of the evidence which has thus been submitted to it, it is therefore for the court seised to decide whether the contract was intended, to a non-negligible extent, to meet the needs of the trade or profession of the person concerned or whether, on the contrary, the business use was merely negligible. For that purpose, the national court should take into consideration not only the content, nature and purpose of the contract, but also the objective circumstances in which it was concluded.
48. Finally, as regards the national court's question as to whether it is necessary for the party to the contract other than the supposed consumer to have been aware of the purpose for which the contract was concluded and the circumstances in which it was concluded, it must be noted that, in order to facilitate as much as possible both the taking and the evaluation of the evidence, it is necessary for the court seised to base its decision mainly on the evidence which appears, de facto, in the file .
49. If that evidence is sufficient to enable the court to conclude that the contract served to a non-negligible extent the business needs of the person concerned, articles 13–15 of the Convention cannot be applied in any event because of the status of those provisions as exceptions within the scheme introduced by the Convention. There is therefore no need to determine whether the other party to the contract could have been aware of the business purpose.
50. If, on the other hand, the objective evidence in the file is not sufficient to demonstrate that the supply in respect to which a contract with a dual purpose was concluded had a non-negligible business purpose, that contract should, in principle, be regarded as having been concluded by a consumer within the meaning of articles 13–15, in order not to deprive those provisions of their effectiveness."
"27. Within the scheme of Regulation No 44/2001, the jurisdiction of the courts of the member state in which the defendant is domiciled constitutes the general principle enshrined in article 2(1) of that Regulation. It is only by way of derogation from that principle that that provision provides for an exhaustive list of cases in which the defendant may or must be sued before the courts of another member state. As a consequence, the rules of jurisdiction which derogate from that general principle are to be strictly interpreted, in the sense that they cannot give rise to an interpretation going beyond the cases expressly envisaged by that Regulation: Gruber v Bay Wa AG (Case C-464/01)  QB 204;  ECR I-439 , para 32.
28. Although the concepts used by Regulation No 44/2001, in particular those which appear in article 15(1) of that Regulation, must be interpreted independently, by reference principally to the general scheme and objectives of that Regulation, in order to ensure that it is applied uniformly in all member states ( Kolassa's case, para 22 and the case law cited), account must, in order to ensure compliance with the objectives pursued by the legislature of the European Union in the sphere of consumer contracts, and the consistency of European Union ("EU") law, also be taken of the definition of "consumer" in other rules of EU law: Vapenik v Thurner (Case C-508/12)  1 WLR 2486 , para 25.
29. In that respect, the court has stated that the notion of a "consumer" for the purposes of articles 15 and 16 of Regulation No 44/2001 must be strictly construed, reference being made to the position of the person concerned in a particular contract, having regard to the nature and objective of that contract and not to the subjective situation of the person concerned, since the same person may be regarded as a consumer in relation to certain transactions and as an economic operator in relation to others: Benincasa v Dentalkit Srl (Case C-269/95)  ECR I-3767;  All ER (EC) 135 , para 16 and Gruber's case, para 36.
30. From this the court has inferred that only contracts concluded outside and independently of any trade or professional activity or purpose, solely for the purpose of satisfying an individual's own needs in terms of private consumption, are covered by the special rules laid down by the Regulation to protect the consumer as the party deemed to be the weaker party. Such protection is, however, unwarranted in the case of contracts for the purpose of a trade or professional activity: Gruber's case, para 36.
31. It follows that the special rules of jurisdiction in articles 15 to 17 of Regulation No 44/2001 apply, in principle, only where the contract has been concluded between the parties for the purpose of a use of the relevant goods or services that is other than a trade or professional use: Gruber's case, para 37.
32. As regards, more particularly, a person who concludes a contract for a purpose which is partly concerned with his trade or profession and is therefore only partly outside it, the court has held that he could rely on those provisions only if the link between the contract and the trade or profession of the person concerned was so slight as to be marginal and, therefore, had only a negligible role in the context of the supply in respect of which the contract was concluded, considered in its entirety: Gruber's case  QB 204 , para 39.
33. It is in the light of those principles that it is appropriate to examine whether circumstances such as those at issue do not entail the loss of a Facebook account user's status as a "consumer" within the meaning of article 15 of Regulation No 44/2001 .
34. In that regard, it is clear from, inter alia, the order for reference that, between 2008 and 2010 Mr Schrems initially used a Facebook account which he had opened exclusively for private purposes whereas, from 2011, he has also used a Facebook page.
35. According to the applicant, there are two separate contracts, that is to say, one for the Facebook page and the other for the Facebook account. By contrast, according to Facebook Ireland, the Facebook account and the Facebook page form part of the same single contractual relationship.
36. Although it is for the referring court to establish whether Mr Schrems and Facebook Ireland are, in fact, bound by one or several contracts and to draw the appropriate inferences regarding the status of "consumer", it should be noted that even a potential contractual link between the Facebook account and the Facebook page would not call into question an assessment of such status on the basis of the principles set out in paras 29–32 above.
37. Within the framework of that assessment, in accordance with the requirement, referred to in para 29 above, to construe strictly the notion of "consumer" within the meaning of article 15 of Regulation No 44/2001 , it is necessary, in particular, to take into account, as far as concerns services of a digital social network which are intended to be used over a long period of time, subsequent changes in the use which is made of those services.
38. This interpretation implies, in particular, that a user of such services may, in bringing an action, rely on his status as a consumer only if the predominately non-professional use of those services, for which the applicant initially concluded a contract, has not subsequently become predominately professional.
39. On the other hand, given that the notion of a "consumer" is defined by contrast to that of an "economic operator" ( Benincasa's case, para 16 and Gruber's case, para 36) and that it is distinct from the knowledge and information that the person concerned actually possesses ( Costea v SC Volksbank Romania SA (Case C-110/14)  1 WLR 814 , para 21), neither the expertise which that person may acquire in the field covered by those services nor his assurances given for the purposes of representing the rights and interests of the users of those services can deprive him of the status of a "consumer" within the meaning of article 15 of Regulation No 44/2001 .
40. Indeed, an interpretation of the notion of "consumer" which excluded such activities would have the effect of preventing an effective defence of the rights that consumers enjoy in relation to their contractual partners who are traders or professionals, including those rights which relate to the protection of their personal data. Such an interpretation would disregard the objective set out in article 169(1)FEU of promoting the right of consumers to organise themselves in order to safeguard their interests.
41. In the light of all of the foregoing considerations, the answer to the first question is that article 15 of Regulation No 44/2001 must be interpreted as meaning that the activities of publishing books, lecturing, operating websites, fundraising and being assigned the claims of numerous consumers for the purpose of their enforcement do not entail the loss of a private Facebook account user's status as a "consumer" within the meaning of that article."
"As regards, more particularly, a person who concludes a contract for a dual purpose, partly for use in his professional activity and partly for private matters, the Court has held that he could rely on those provisions only if the link between the contract and the trade or profession of the person concerned was so slight as to be marginal and, therefore, had only a negligible role in the context of the transaction in respect of which the contract was concluded, considered in its entirety (see, to that effect, judgment of 25 January 2018, Schrems, C-498/16, EU:C:2018:37, paragraph 32 and the case-law cited)."
29. In Case C-269/95, Benincasa  ETMR 447 , again decided under the Brussels Convention, the ECJ decided that the consumer rule did not apply in the case of a contract entered into by an individual for the purpose of a trade to be taken up in the future. The contract was a franchising agreement for the purpose of setting up a business selling dental hygiene products under the Dentalkit trade mark. Again, the court reasoned from the starting point that the consumer rule was a derogation favouring the domicile of the plaintiff and, therefore, to be kept within its proper bounds (at -). The court cited Shearson Lehman Hutton as 'settled case-law' for the proposition that the consumer rule " affects only a private final consumer, not engaged in trade or professional activities " (at ). It held (at ) that the consumer rule applies " only to contracts concluded outside and independently of any trade or professional activity or purpose, whether present or future ".
30. At , the court said that " only contracts concluded for the purpose of satisfying an individual's own needs in terms of private consumption " were protected by the consumer rule, which protection " is unwarranted in the case of contracts for the purpose of trade or professional activity, even if that activity is only planned for the future, since the fact that an activity is in the nature of a future activity does not divest it in any way of its trade or professional character ". I do not read the reference to an individual's " own needs in terms of private consumption " as refining the notion of 'consumer' to something narrower than " private final consumer, not engaged in trade or professional activities ". The sole criterion is that of being a private individual contracting as the end user (of goods or services) and not as part of a business (trade or profession).
31. In Case C-464/01, Gruber v Bay Wa AG  QB 204 , the ECJ considered the problem of a contract with a dual purpose. The contract in question was for the supply of roof tiles to a farmer to renovate a roof covering both the parts of a main farm building used as the farmhouse, i.e. Mr Gruber's home, and parts of that same building used for the commercial purposes of the farm. The court held that where to a non-negligible extent the purpose of a contract was a business purpose, the consumer rule did not apply. It adopted the reasoning in Shearson Lehman Hutton Inc and Benincasa . It said nothing to gainsay my reading of the reference in Benincasa to an individual's 'private consumption' needs.
32. The court was also asked whether for the consumer rule to apply it is necessary for the counterparty to have been aware of the purpose for which the putative consumer entered into the contract. Its answer fashioned a rule under which an individual may fall outside the scope of the consumer rule because she has given the impression of acting for a trade or professional purpose even though she was not in fact doing so. The scope of this 'non-consumer impression' rule was contentious before me, especially as to whether the counterparty must in fact have formed a view that the putative consumer was acting for a business purpose. What the ECJ said, in full, was this:
"50. If … the objective evidence in the file is not sufficient to demonstrate that the supply in respect to which a contract with a dual purpose was concluded had a non-negligible business purpose, that contract should, in principle, be regarded as having been concluded by a consumer within the meaning of Articles 13 to 15 , in order not to deprive those provisions of their effectiveness.
51. However, having regard to the fact that the protective scheme put in place by Articles 13 to 15 of the Brussels Convention represents a derogation, the court seised must in that case also determine whether the other party to the contract could reasonably have been unaware of the private purpose of the supply because the supposed consumer had in fact, by his own conduct with respect to the other party, given the latter the impression that he was acting for business purposes.
52. That would be the case, for example, where an individual orders, without giving further information, items which could in fact be used for his business, or uses business stationery to do so, or has goods delivered to his business address, or mentions the possibility of recovering value added tax.
53. In such a case, the special rules of jurisdiction for matters relating to consumer contracts enshrined in Articles 13 to 15 of the Brussels Convention are not applicable even if the contract does not as such serve a non-negligible business purpose, and the individual must be regarded, in view of the impression he has given to the other party acting in good faith, as having renounced the protection afforded by those provisions."
33. Most recently, in Case C-498/16, Schrems v Facebook Ireland  1 WLR 4343 , the ECJ considered the meaning of 'consumer' under what was then Article 15 of the Brussels Regulation . In particular, it considered whether an individual is a consumer where, having used a Facebook account for private purposes, he opened a Facebook page to report to internet users on: legal proceedings; lectures; panel debates/media appearances; donation campaigns; and book promotions. The court held that those activities did not entail the loss of a private Facebook account user's status as a 'consumer':
"37. … in accordance with the requirement … to construe strictly the notion of 'consumer' within the meaning of Article 15 of Regulation No 44/2001 , it is necessary, in particular, to take into account, as far as concerns services of a digital social network which are intended to be used over a long period of time, subsequent changes in the use which is made of those services.
38. This interpretation implies, in particular, that a user of such services may, in bringing an action, rely on his status as a consumer only if the predominately non-professional use of those services, for which the applicant initially concluded a contract, has not subsequently become predominately professional.
39. On the other hand, given that the notion of a 'consumer' is defined by contrast to that of an 'economic operator' (see, to that effect … Benincasa … para 16, and … Gruber's case … para 36) and that it is distinct from the knowledge and information that the person concerned actually possesses ( Costea v SC Volksbank Romania SA (Case C-110/14) EU:C:2015:538 , para 21), neither the expertise which that person may acquire in the field covered by those services nor his assurances given for the purposes of representing the rights and interests of the users of those services can deprive him of the status of a 'consumer' within the meaning of article 15 of Regulation No 44/2001 ."
Contentions of Mr Loro Piana on the facts.
Contentions of PML on the facts.
(1) "The Yacht is used solely for MR LORO PIANA's private leisure purposes";
(2) "He was in the process of transporting the Yacht from Antigua (where it had been for the winter) to Europe (for the summer").
"… information provided by Mr Loro Piana that has been relayed to me by his Italian lawyers, Studio Legale Mordiglia (without waiving any privilege in those communications) and, in particular to Mr Scapinello, who has had the conduct of this matter on his behalf".
(1) Clearly the purpose of the contract was to transport the yacht to Genoa, so that it could be used over the summer season. Although I had some evidence in relation to previous years' usage, I do not think that this is of any real assistance to me, except possibly insofar as it displays a pattern of usage which might be expected to be repeated.
(2) There was a suggestion that the question of whether the contract was a consumer contract should be determined by a consideration of whether Mr Loro Piana's business was the transport of Yachts. I do not accept this suggestion. A party who enters into a transport contract for the purpose of transporting goods to be used in its business is clearly a non-consumer contract.
(3) In my judgment, the question therefore is what the Yacht was going to be used for during the summer season, and whether that usage involved business use to more than a negligible degree, the burden being on Mr Loro Piana to show that it did not.
(4) Mr Loro Piana remained a shareholder in Loro Piana SpA and was also the deputy chairman of the company. He was also an ambassador for the company. Although I accept the submission made on his behalf that the majority of his time was spent dealing with his personal investments, then that does not detract from the fact that he retained his connection with Loro Piana SpA.
(5) The evidence adduced on behalf of PML, taken from publicly available material, suggests that the Yacht was used for significant business purposes, including the following:
(a) Celebrities were invited on board the Yacht in order to promote Loro Piana SpA's products and to watch the Yacht during the regatta;
(b) The Yacht was used for marketing purposes, and features in many articles in which Loro Piana SpA products are publicised;
(c) Loro Piana SpA sponsored the Sardinian regatta in which the Yacht competed, thus enabling enhanced publicity to be generated;
(d) The Yacht was used as a testing ground for innovations in relation to fabrics produced by Loro Piana SpA;
(e) Yachting, and Mr Loro Piana's love of yachting, was emphasised in publicity material generated by Loro Piana SpA;
(f) The Yacht's sail carried the Loro Piana SpA name when sailing in regattas;
(g) The Loro Piana SpA "Storm System" was also advertised on the Yacht.
(6) For his part, Mr Loro Piana has produced no personal evidence at all. Mr Taylor, the partner from Reed Smith who is instructed on his behalf, has sworn three witness statements, however. In those witness statements, he makes the following points:
(a) Although it was accepted that Loro Piana SpA sponsored regattas and that the yacht participated in them, and also that the yacht featured in Loro Piana SpA promotional materials, the yacht itself was not sponsored and Mr Loro Piana received no remuneration, and met all the costs of the yacht himself.
(b) Mr Loro Piana's use of the yacht was for his personal leisure purposes, and he met the cost of the transport of the yacht for these purposes. The fact that there was a collateral benefit to Loro Piana SpA did not deprive the contract of its consumer nature.
(c) Mr Loro Piana has no operative role in the company.
The Consumer Rights Act 2015.
"62 Requirement for contract terms and notices to be fair
(1) An unfair term of a consumer contract is not binding on the consumer….
(3) This does not prevent the consumer from relying on the term or notice if the consumer chooses to do so.
(4) A term is unfair if, contrary to the requirement of good faith, it causes a significant imbalance in the parties' rights and obligations under the contract to the detriment of the consumer.
(5) Whether a term is fair is to be determined—
(a)taking into account the nature of the subject matter of the contract, and
(b)by reference to all the circumstances existing when the term was agreed and to all of the other terms of the contract or of any other contract on which it depends."
"A term which has the object or effect of excluding or hindering the consumer's right to take legal action or exercise any other legal remedy, in particular by—
(a) requiring the consumer to take disputes exclusively to arbitration not covered by legal provisions,
(b) unduly restricting the evidence available to the consumer, or
(c) imposing on the consumer a burden of proof which, according to the applicable law, should lie with another party to the contract."
Mr Loro Piana's contentions.
(1) The present case is analogous to Standard Bank London Ltd v Apostolakis (No.2)  CLC 939 (David Steel J). In Apostolakis, a wealthy Greek couple (a lawyer and an engineer) entered into forex contracts with a London bank that contained an English jurisdiction clause. The Court held (applying the same test now found in section 62(1) derived from the Consumer Directive) that the EJC was unfair. In doing so, the Court accepted the proposition that the clause (which provided for the English Court or any court where the consumers had assets to have jurisdiction for claims by the bank) should have been translated and "carefully explained" . The Court also referred at  to Océano Grupo Editorial SA v Rocío Murciano Quintero  1 CMLR 43, where the European Court noted that an exclusive jurisdiction clause in favour of the trader's domicile had the potential to create a significant imbalance in the parties' rights and obligations and so fell within the Consumer Directive equivalent of Schedule 2, paragraph 20 of the CRA.
(2) As indicated in Océano Grupo, an EJC is a term that hinders the consumer's right to take legal action, which is indicatively unfair under Schedule 2, paragraph 20 of the CRA.
(3) Although the EJC in the present case was not as complex as that considered in Apostolakis, the clause was buried in the small print of PML's terms and conditions. It provided for the foreign consumer to be sued in the trader's domicile in a foreign language. The clause was not identified in the "Key Facts" document provided prior to contracting or otherwise explained or brought to the attention of Mr Loro Piana or Mr Benussi. It is no answer to this unfairness to point to Mr Loro Piana's wealth, as Apostolakis demonstrates.
(4) Accordingly, the clause creates a significant imbalance, contrary to the requirement of good faith because it permits Mr Loro Piana, an Italian consumer, to be sued in England (contrary to the general principle of domicile in the Brussels Regulation) without giving him adequate notice that he could be sued in a country that had peripheral connection to the carriage of the Yacht from Antigua to Genoa by Weco, a Danish company, under a contract with Zeamarine, a German company, and negotiated with an Italian company, PMS. This is substantially inconvenient and unfair to Mr Loro Piana, who has been required to instruct Italian lawyers to instruct English lawyers to protect his position in a foreign court in a foreign language. In contrast, PML is a pre-eminent yacht transport company, no doubt familiar with litigation in England, which was perfectly capable of drawing the EJC to Mr Loro Piana's attention and failed to do so. PML is also perfectly willing and able to litigate in Italy, as the investigative proceedings that it has commenced there demonstrate.
(1) First, it is argued that any question of the Court's jurisdiction over Mr Loro Piana has to be determined solely in accordance with the rules set out in the Brussels (Recast) Regulation;
(2) Secondly, it is argued that the CRA must be restricted so that it does not interfere with the operation of the Recast Regulation;
(3) Thirdly, PML argue that the term is not unfair in any event.
The Recast Regulation excludes the operation of the CRA.
"… as the Advocate General observed in points 76 and 77 of his Opinion, the case-law of the Court concerning Directive 93/13 is not applicable in the context of [Brussels (Recast)] Regulation No 1215/2012, which lays down rules of a procedural nature, whereas Directive 93/13 is intended to achieve minimum harmonisation of laws of the Member States concerning unfair terms in consumer contracts".
(1) the rules contained in the Brussels (Recast) Regulation (Aqua Med SP. Z.O.O. v Skóra (Case C-266/18)  3 C.M.L.R. 1,  and / or
(2) the ECJ's own case-law on those provisions (e.g. Asociación de Consumidores Independientes de Castilla y León (C-413/12)  2 C.M.L.R. 24, at paragraphs 46-7.
(1) The case of Océano Grupo Editorial, along with two other similar cases to which Mr Loro Piana has not referred the Court, namely Pannon GSM Zrt v Sustikné Gyorfi (C-243/08),  1 All ER (Comm) 640 (C-243/08), and VB Pénzügyi Lízing Zrt Zrt. v Ferenc Schneider (C-137/08)  2 CMLR 1 are all cases under Directive 93/13 that involve internal, national territorial jurisdiction clauses (or perhaps better described as "venue selection clauses") which conferred jurisdiction on or near the supplier's principal place of business or registered office. These clauses conferred jurisdiction on the courts of cities were consumers were not domiciled but still in the country of their domicile. In the absence of any cross-border element, these territorial jurisdiction arrangements were not "prorogation" agreements within the meaning of art. 25 of the Brussels (Recast) Regulation, and the Court's case-law regarding the Directive 93/13 in relation to these matters is irrelevant to the determination of any questions arising under art. 17-19 or art. 25 of Brussels (Recast).
(2) The early and controversial decision in Standard Bank of London Ltd v Apostolakis (No. 2)  2 CLC 939 is the only case where a judge has been persuaded to make some entirely obiter observations on the possible applicability of the UK regulations implementing Directive 93/ 13 affecting cross-border jurisdiction clauses and expressed "preliminary views upon the point" (para. ). With respect, these obiter dicta in Standard Bank should not be followed. As the subsequent attitude of the ECJ has shown, the application of the dicta in the decision in Océano Grupo Editorial to a cross-border case was erroneous. Directive 93/13 has no role to place in deciding questions of international jurisdiction which are to be determined by the consumer jurisdiction provisions of the Brussels Recast Regulation. Standard Bank is also readily distinguishable on the facts.
Restrictions on the role of the CRA.
Not "unfair" in any event
(1) Although Mr Loro Piana was a consumer for the purposes of the Act, he was an experienced businessman. He also had the assistance of a professional logistics agent to act on his behalf in making the arrangements, in the person of Mr Benussi. I accept that this last point is a very relevant one, although I do not accept that the case of Heifer International, relied on by PML, is really in point.
(2) The jurisdiction agreement did not, in and of itself, create any imbalance between the parties, still less a serious imbalance. It is said that there is a serious imbalance since Mr Loro Piana will have to instruct English lawyers, and he does not speak English. As to the second point, I do not doubt the evidence of Mr Taylor, although the evidence is not all one way. More importantly, as to the first, both parties must instruct English lawyers, with the result that there is no difference between the position of the two parties.
(3) Although it is suggested that Mr Loro Piana would not have appreciated that the contract incorporated a jurisdiction clause, such clauses are commonplace, particularly in contracts for the carriage of goods; and the contract was signed, right next to one of the jurisdiction clauses relied on, by Mr Loro Piana. I accept that in general terms, where a party has been given the opportunity to read a contract, that party cannot be heard to say that he has not taken that opportunity: see, for example, Coys of Kensington Automobiles v Pugliese  EWHC 655, at .
The position as between Weco and Mr Loro Piana.
(1) First, they rely on the provisions of Article 8(1) of the Regulation.
(2) Secondly, they argue that they are entitled to the benefit of the EJC by virtue of the Himalaya clause in the booking note.
Does the Court have jurisdiction under Article 8(1) of the Recast Regulation?
"A person domiciled in a Member State may also be sued:
(1) where he is one of a number of defendants, in the courts for the place where any one of them is domiciled, provided the claims are so closely connected that it is expedient to hear and determine them together to avoid the risk of irreconcilable judgments resulting from separate proceedings;"
(1) Mr Loro Piana is domiciled in a member state;
(2) He is one of a number of Defendants sued by Weco, including PML, which is domiciled in England;
(3) The claims between Weco and the Defendants are closely interconnected, because the facts relating to the casualty will arise in each claim, and should be determined in the same way;
(4) The fact that the claim against PML was brought with a view to obtaining jurisdiction over the other Defendants is not a bar to the application of Article 8(1): see the decision of the Court of Appeal in PJSC Commercial Bank Privatbank v Kolomoivsky  2 WLR 993, at paragraph 102.
(5) There is nothing abusive about the bringing of the action, so as to bring the matter within the limits suggested by the Supreme Court in Lungowe v Vedanta Resources PLC  2 WLR 1051, at paragraphs 31 to 41.
(6) Accordingly, the English Court has jurisdiction over Mr Loro Piana.
(1) The relevant claims are not so closely connected that they raise the risk of irreconcilable judgments; and
(2) Weco's claim is an attempt to fulfil Article 8 artificially and is thus ineffective to come within the Article.
Mr Loro Piana's submissions.
(1) As set out above, the conclusion of London Offshore Consultants (appointed by the Yacht Interests' insurers) is that the Yacht was lost because her cradle was defective without any fault on the part of the Vessel or her crew. That is also Weco's case.
(2) PML has acknowledged service and indicated that it intends to defend Weco's claim for relief against it.
(3) In the Italian proceedings, Mr Loro Piana alleges that the yacht was lashed and secured to the deck of the ship in a completely inadequate manner, and that neither the Master nor officers checked or intervened.
(1) Insofar as Mr Loro Piana focusses on the basis of his and PML's claims, actual or potential, against Weco, their analysis is confused. The issue is whether there is a close connection between Weco's claims against the Defendants (the irreconcilable and concurrent resolution of which Article 8 is designed to avoid), not vice versa: Freeport (supra.), at paragraphs 39-41. Hence, the Court needs to be satisfied that the anchor claim is sustainable (see Senior Taxis Aereo v Agusta Westland  EWHC 1348 (Comm)), not the potential claims of the defendants. Secondly, Mr Loro Piana implies that the causes of action sought to be deflected by Weco need to be the same to be closely connected. Even if directed at Weco's claims rather than the Defendants', there is no requirement that the two claims have identical legal bases: Terre Neuve SARL (supra.). Third and in any event, if it matters, the legal route by which Weco intends to establish non-liability as against the Yacht Interests and PML is the same.
(2) Mr Loro Piana argues that it was not foreseeable that he would be sued in the English High Court by Weco. This is a non-point since the legal basis for Weco's primary claim against the Defendants is the same, such that there is no requirement of foreseeability: Painer (supra). In any event, it is difficult to understand why it was not foreseeable that the owner of the Vessel would sue the Yacht Interests in England given that the primary contract- the booking note - provides for exclusive English jurisdiction. At the very least, Mr Loro Piana must have envisaged that any litigation against PML would, if commenced in accordance with the booking note (and not in breach per the Italian proceedings), ensue in this jurisdiction. It was foreseeable that, in such an event, PML (or indeed the Italian parties) might seek to join Weco as a party, prompting Weco to counterclaim for a declaration of non-liability not only against PML but also against the Italian parties. The imperative of minimising the possibility of concurrent proceedings is such that English proceedings involving Weco were always foreseeable. The Italian parties' attempt to argue that being sued by Weco was not foreseeable is an attempt to take advantage of their decision to sue PML (and now Weco) in Italy in breach of the EJCs.
(3) It is said that Weco's claim against PML is artificial to the point of being contrived. This is not so. Weco has brought proceedings against PML precisely because, so far as is possible, it wants to have any possible liabilities it may face determined in a single forum at the same time. There is an obvious possibility that PML might seek to pass on to Weco any liability that it might have to the Yacht Interests. It is notable that PML has indicated that it will defend Weco's claim for a declaration of non-liability to PML. It matters not that PML had not intimated a claim before Weco commenced. This would amount to an argument that a claim for a declaration of non-liability can only serve as an anchor if it is responsive to the threat to litigation. This cannot be correct. No such requirement is disclosed by Article 8. It would be unprincipled to penalise a claimant for taking the initiative to pre-emptively seek a negative declaration. So far as the anchor claim itself is concerned, the only relevant threshold question is whether the claimant has a good arguable case: Senior Taxi (supra.). There is and can be no suggestion that Weco's claim against PML does not meet this threshold. Further, it is not the case that a contingent claim, premised on liability which is denied, cannot be an anchor claim: FKI Engineering Ltd & Anr v De Wind Holdings Ltd & Anr  EWCA Civ 316 at paragraphs 13-14. Finally, there is no reason for the Court to take an adverse view of a claim for negative declaratory relief: Messier Dowty Ltd v Sabens S.A.  1 WLR 2040 at paragraph 36; and AG Tesauro's opinion in Owners of Cargo lately laden on board the ship Tatry v Owners of the ship Maciej Rataj (C-406/92)  QB 515 at paragraph 23.
(4) Bad faith or abuse is required for a claim to be stigmatised as artificial in the sense contended for by the Yacht Interests: Senior v Agusta at paragraph 65. For examples, see paragraphs 86-87 of Privatbank (supra.), e.g. commencing proceedings against a fictitious anchor defendant. No allegation of abuse or bad faith could be levelled at Weco in this case.
"80 However, in assessing whether there is a connection between different claims, that is to say a risk of irreconcilable judgments if those claims were determined separately, the identical legal bases of the actions brought is only one relevant factor among others. It is not an indispensable requirement for the application of Article 6(1) of Regulation No 44/2001 (see, to that effect, Freeport, paragraph 41).
81 Thus, a difference in legal basis between the actions brought against the various defendants, does not, in itself, preclude the application of Article 6(1) of Regulation No 44/2001, provided however that it was foreseeable by the defendants that they might be sued in the Member State where at least one of them is domiciled (see, to that effect, Freeport, paragraph 47).
82 That reasoning is stronger if, as in the main proceedings, the national laws on which the actions against the various defendants are based are, in the referring court's view, substantially identical.
83 It is, in addition, for the referring court to assess, in the light of all the elements of the case, whether there is a connection between the different claims brought before it, that is to say a risk of irreconcilable judgments if those claims were determined separately. For that purpose, the fact that defendants against whom a copyright holder alleges substantially identical infringements of his copyright did or did not act independently may be relevant.
84 In the light of the foregoing considerations, the answer to the first question is that Article 6(1) of Regulation No 44/2001 must be interpreted as not precluding its application solely because actions against several defendants for substantially identical copyright infringements are brought on national legal grounds which vary according to the Member States concerned. It is for the referring court to assess, in the light of all the elements of the case, whether there is a risk of irreconcilable judgments if those actions were determined separately."
"23. Nevertheless, the court points out that, even in the case where various laws are, by virtue of the rules of private international law of the court seised, applicable to the actions for damages brought by CDC against the defendants, such a difference in legal basis does not, in itself, preclude the application of article 6(1) of Regulation No 44/2001 , provided that it was foreseeable by the defendants that they might be sued in the member state where at least one of them is domiciled: Painer's case, para 84."
"269. The Panasonic defendants submit that neither PME nor PI could reasonably have foreseen that they might be sued in the English courts in relation to the CPT cartel. In support of this they refer to the following features: the Decision had no UK addressee; the only Panasonic addressees were Japanese companies, as were the Toshiba addressees; the anchor defendant, PE, had not participated in the cartel, had not sold the cartelised product or CTVs, and had not been made a party to any other regulatory process or civil claim relating to the cartel. In these circumstances, there was no reason for PME or PI to think that they might be sued in the English courts in a claim in which PE was used as an anchor defendant. Nor could PME and PI have foreseen that they would be sued in England in proceedings with TIS, an unrelated party, as an anchor defendant. TIS was not an addressee of the Decision, and did not sell the cartelised product during the relevant period. In addition, none of the claimants is UK-domiciled; they do not have retail outlets in the UK; and all the relevant CTV purchases were made outside the UK.
270. Ms Abram submitted that, although one could have a debate about whether the foreseeability criterion is part of the "close connection" condition or is a separate hurdle in addition to that condition, such a debate would be arid: in either case the foreseeability criterion had to be satisfied on its own merits, albeit that it fed into the "close connection" requirement. She also contends that the claimants are wrong to suggest that the question of foreseeability only arises in cases where the claims against the anchor and the non-anchor defendants have different legal bases. Their reliance on CDC for that proposition is, she submits, misplaced: the case law in question decides that art.8(1) can apply even where the claims have different legal bases; it does not decide that the foreseeability requirement is inapplicable where the claims have the same legal base.
271. The relevant passages in CDC are as follows:
"22. As regards, finally, the risk of irreconcilable judgments resulting from separate proceedings, since the requirements for holding those participating in an unlawful cartel liable in tort may differ between the various national laws, there would be a risk of irreconcilable judgments if actions were brought before the courts of various Member States by a party allegedly adversely affected by a cartel.
23. Nevertheless, the Court points out that, even in the case where various laws are, by virtue of the rules of private international law of the court seised, applicable to the actions for damages brought by CDC against the defendants in the main proceedings, such a difference in legal basis does not, in itself, preclude the application of Article 6(1) of Regulation No 44/2001 , provided that it was foreseeable by the defendants that they might be sued in the Member State where at least one of them is domiciled (see judgment in Painer, C-145/10, EU:C:2011:798 , paragraph 84 [It appears that this reference should in fact be to  of Painer .]).
24. That latter condition is fulfilled in the case of a binding decision of the Commission finding there to have been a single infringement of EU law and, on the basis of that finding, holding each participant liable for the loss resulting from the tortious actions of those participating in the infringement. In those circumstances, the participants could have expected to be sued in the courts of a Member State in which one of them is domiciled."
272. I accept Ms Abram's submission that foreseeability is not only relevant in cases where different legal bases for claims are in play. The statement of the ECJ in Reisch Montage is quite general in that regard, and that decision is expressly referred to by the ECJ in CDC . It is perhaps understandable that the Court should have emphasised foreseeability when referring to a case in which different legal bases for the claims existed, as in such a situation it might be less likely to be satisfied.
273. However, it seems to me that Ms Abram's wider argument is in danger of treating the statement of the ECJ in Reisch Montage as adding a free-standing and distinct criterion of foreseeability to the preconditions of application expressly set out in art.8(1). If that criterion were to be applied generally, and without reference to those express preconditions, there would be a risk of the EU law principle of legal certainty being compromised, instead of respected as Reisch Montage expressly requires. That case states that the special rule in art.8(1) must be interpreted so as to ensure legal certainty. The special rule's express precondition is that "the claims are so closely connected that it is expedient to hear and determine them together to avoid the risk of irreconcilable judgments …". Therefore, by virtue of Reisch Montage , it is those words that must be interpreted strictly so as to respect legal certainty and thereby ensure foreseeability . In other words, foreseeability is inextricably linked to the closeness of the connection between the two sets of claims, and the criterion will be satisfied if a sufficiently close connection of the kind described in art.8(1) exists."
The argument based on the Himalaya clause.
"It is hereby expressly agreed that no servant or agent of the Company (including every independent contractor from time to time employed by the Company) shall in any circumstances whatsoever be under any liability whatsoever to the Merchant for any loss, damage or delay arising or resulting directly or in-directly from any act, neglect or default on his part while acting in the course of or in connection with his employment and, but without prejudice to the generality of the foregoing provisions in this clause, every exemption from liability, limitation, condition and liberty herein contained and every right, exemption from liability, defence and immunity of whatsoever nature applicable to the Company or to which the Company is entitled hereunder shall also be available and shall extend to protect every such servant or agent of the Company acting as aforesaid and for the purpose of all the foregoing provisions of this clause the Company is or shall be deemed to be acting as agent or trustee on behalf of and for the benefit of all persons who are or might be his servants or agents from time to time (including independent contractors as aforesaid) and all such persons shall to this extent be or be deemed to be parties to the agreement evidenced by this Booking Note."
"93. A Himalaya clause in a contract of carriage is designed to create contractual relations between the shipper and any third parties whom the carrier may employ to discharge his obligations. It does so without infringing the English doctrines of privity of contract and consideration, which, until the Contracts (Rights of Third Parties) Act 1999, prevented third parties from claiming benefits under contracts. The way it works is this. The shipper makes an agreement through the agency of the carrier with the third party servant or contractor. Such third parties may have authorised the carrier in advance to contract on their behalf or they may afterwards ratify the agreement. The terms of the agreement are that if such a third party renders any services for the benefit of the cargo owner in the course of his employment by the carrier, he will be entitled to the exemptions and immunities set out in the clause. At that stage, the agreement is not a contract. The third party makes no promise to the shipper to render any services and, until he has actually rendered them, no contract has come into effect. It is the act of rendering the services which provides the consideration and brings into existence a binding contract under which the third party is entitled to the exemptions and immunities. The efficaciousness of the clause to achieve these results has been affirmed by the decision of the Privy Council in New Zealand Shipping Co Ltd v A M Satterthwaite & Co Ltd (The Eurymedon)  AC 154 . The theory of the agreement which becomes enforceable conditionally upon the act providing consideration was developed by Sir Garfield Barwick CJ in his dissenting judgment in the High Court of Australia in Port Jackson Stevedoring Pty Ltd v Salmond & Spraggon (Australia) Pty Ltd (The New York Star) (1978) 139 CLR 231 and adopted by the Privy Council when it affirmed his judgment on appeal: see The New York Star  1 WLR 138 ."
Mr Loro Piana's contentions.
"The exclusive jurisdiction clause
The Himalaya clause provides that, among others, subcontractors shall have the benefit of "all exceptions, limitations, provision, conditions and liberties herein benefiting the carrier as if such provisions were expressly made for their benefit." The question therefore arises whether the exclusive jurisdiction clause (clause 19) falls within the scope of this clause.
In The Eurymedon  AC 154 , 169 and The New York Star ÜtbÜdc1Ý  1 WLR 138 , 143 Lord Wilberforce stated the principle to be applicable, in the case of stevedores, to respectively "exemptions and limitations" and "defences and immunities" contained in the bill of lading. This is scarcely surprising. Most bill of lading contracts incorporate the Hague-Visby Rules , in which the responsibilities and liabilities of the carrier are segregated from his rights and immunities, the latter being set out primarily in article IV, rules 1 and 2 , exempting the carrier and the ship from liability or responsibility for loss of or damage to the goods in certain specified circumstances; though the limitation on liability per package or unit is to be found in article IV, rule 5 , and the time bar in article III, rule 6 . Terms such as these are characteristically terms for the benefit of the carrier, of which subcontractors can have the benefit under the Himalaya clause as if such terms were expressly made for their benefit.
It however by no means follows that the same can be said of an exclusive jurisdiction clause, here incorporating, as is usual, a choice of law provision relating to the law of the chosen jurisdiction. No question arises in the present case with regard to the choice of law provision. This already applies to the bill of lading contract itself, and may for that reason also apply to another contract which comes into existence, pursuant to its terms, between the shipper and a subcontractor of the carrier such as the shipowners in the present case. But the exclusive jurisdiction clause itself creates serious problems. Such a clause can be distinguished from terms such as exceptions and limitations in that it does not benefit only one party, but embodies a mutual agreement under which both parties agree with each other as to the relevant jurisdiction for the resolution of disputes. It is therefore a clause which creates mutual rights and obligations. Can such a clause be an exception, limitation, provision, condition or liberty benefiting the carrier within the meaning of the clause?
First of all, it cannot in their Lordships' opinion be an exception, limitation, condition or liberty. But can it be a provision? That expression has, of course, to be considered in the context of the Himalaya clause; and so the question is whether an exclusive jurisdiction clause is a provision benefiting the carrier, of which servants, agents and subcontractors of the carrier are intended to have the benefit, as if the provision was expressly made for their benefit. Moreover, the word "provision" is to be found at the centre of a series of words, viz. "exceptions, limitations . . . conditions and liberties," all of which share the same characteristic, that they are not as such rights which entail correlative obligations on the cargo owners.
In considering this question, their Lordships are satisfied that some limit must be placed upon the meaning of the word "provision" in this context. In their Lordships' opinion the word "provision" must have been inserted with the purpose of ensuring that any other provision in the bill of lading which, although it did not strictly fall within the description "exceptions, limitations, . . . conditions and liberties," nevertheless benefited the carrier in the same way in the sense that it was inserted in the bill for the carrier's protection, should enure for the benefit of the servants, agents and subcontractors of the carrier. It cannot therefore extend to include a mutual agreement, such as an exclusive jurisdiction clause, which is not of that character.
Their Lordships draw support for this view from the function of the Himalaya clause. That function is, as revealed by the authorities, to prevent cargo owners from avoiding the effect of contractual defences available to the carrier (typically the exceptions and limitations in the Hague-Visby Rules ) by suing in tort persons who perform the contractual services on the carrier's behalf. To make available to such a person the benefit of an exclusive jurisdiction clause in the bill of lading contract does not contribute to the solution of that problem. Furthermore to construe the general words of the Himalaya clause as effective to make available to servants, agents or subcontractors a clause which expressly refers to disputes arising under the contract evidenced by the bill of lading, to which they are not party, is not easy to reconcile with those authorities (such as T.W. Thomas & Co. Ltd. v. Portsea Steamship Co. Ltd.  AC 1 ) which hold that general words of incorporation are ineffective to incorporate into a bill of lading an arbitration clause which refers only to disputes arising under the charter.
Furthermore, it is of some significance to observe how adventitious would have been the benefit of the exclusive jurisdiction clause to the shipowners in the present case. Such a clause generally represents a preference by the carrier for the jurisdiction where he carries on business. But the same cannot necessarily be said of his servants, agents or subcontractors. It could conceivably be true of servants, such as crew members, who may be resident in the same jurisdiction; though if sued elsewhere they may in any event be able to invoke the principle of forum non conveniens. But the same cannot be said to be true of agents, still less of subcontractors. Take, for example, stevedores at the discharging port, who provide the classic example of independent contractors intended to be protected by a Himalaya clause. There is no reason to suppose that an exclusive jurisdiction clause selected to suit a particular carrier would be likely to be of any benefit to such stevedores; it could only conceivably be so in the coincidental circumstance that the discharging port happened to be in the country where the carrier carried on business. Exactly the same can be said of a shipowner who performs all or part of the carrier's obligations under the bill of lading contract, pursuant to a time or voyage charter. In such a case, the shipowner may very likely have no connection with the carrier's chosen jurisdiction. Coincidentally he may do so, as in the present case where the shipowners happened, like Sentosa, to be an Indonesian corporation. This of course explains why the shipowners in the present case wish to take advantage of the exclusive jurisdiction clause in Sentosa's form of bill of lading; but it would not be right to attach any significance to that coincidence.
In the opinion of their Lordships, all these considerations point strongly against the exclusive jurisdiction clause falling within the scope of the Himalaya clause. However in support of his submission that the exclusive jurisdiction clause fell within the scope of the Himalaya clause in the present case, Mr. Gross, for the shipowners, invoked the decision of the Privy Council in The Pioneer Container  2 AC 324 . That case was however concerned with a different situation, where a carrier of goods subcontracted part of the carriage to a shipowner under a "feeder" bill of lading, and that shipowner sought to enforce an exclusive jurisdiction clause contained in that bill of lading against the owners of the goods. The Judicial Committee held that the shipowner was entitled to do so, because the goods owner had authorised the carrier so to subcontract "on any terms," with the effect that the shipowner as sub-bailee was entitled to rely on the clause against the goods owner as head bailor. The present case is however concerned not with a question of enforceability of a term in a sub-bailment by the sub-bailee against the head bailor, but with the question whether a subcontractor is entitled to take the benefit of a term in the head contract . The former depends on the scope of the authority of the intermediate bailor to act on behalf of the head bailor in agreeing on his behalf to the relevant term in the sub-bailment ; whereas the latter depends on the scope of the agreement between the head contractor and the subcontractor, entered into by the intermediate contractor as agent for the subcontractor, under which the benefit of a term in the head contract may be made available by the head contractor to the subcontractor. It does not follow that a decision in the former type of case provides any useful guidance in a case of the latter type; and their Lordships do not therefore find The Pioneer Container of assistance in the present case.
In the event, for the reasons they have already given, their Lordships have come to the conclusion that the Himalaya clause does not have the effect of enabling the shipowners to take advantage of the exclusive jurisdiction clause in the bill of lading in the present case."
(1) First, they analysed the purpose of the Himalaya clause, which was to extend defences which were available to the carrier to the carrier's servants or agents, so as to avoid the possibility that the allocation of risk in the contract might be subverted by the simple expedient of suing the servant or agent in tort. An exclusive jurisdiction clause was not a defence of this sort; it was a term which was for the mutual benefit of both parties. Weco argued that it was such a defensive clause, because it might be necessary to ensure that defences were given proper effect (since some jurisdictions might not do so). Whilst I can see the practical force in this argument, I do not think that this makes the jurisdiction clause itself a defence.
(2) Secondly, the Privy Council made reference to authorities, including Thomas v Portsea, that indicated that clauses in bills of lading purporting to incorporate the terms of charters were not apposite to incorporate dispute resolution clauses that related to disputes under the charter. Weco argued that these authorities should be limited to the particular question with which they dealt, namely the incorporation of charterparty arbitration clauses into bill of lading contracts, and they referred me to the decision of Christopher Clarke J (as he then was) in Habas Sinai ve Tibbi Gazlar Isthisal Endustrie AS v Sometal SA  EWHC 29. In that case, the question was whether an arbitration clause that had been contained in at least some previous contracts between the two contracting parties was incorporated by reference in a contract which simply provided that the terms of that contract were to be the same as in previous contracts. A distinction was drawn in the case between a "one contract case" where the terms being incorporated were standard terms or from other contracts between the same parties and a "two contract case" where the terms being incorporated came from a contract between different parties. After a consideration of the authorities, beginning with Thomas v Portsea, Christopher Clarke J said this:
"52. I do not accept that the present case is to be regarded as a "two-contract" case. Whilst, literally speaking, there is more than one contract to be considered, being the June contract and whatever other contracts between the same parties are to have some of their terms incorporated, the relevant distinction is between incorporation of the terms of a contract made between (a) the same and (b) different parties. In short there is a material distinction between categories 1 and 2 on the one hand and categories 3 and 4 on the other. In relation to the latter two categories a more restrictive approach to incorporation is required. That should not, however, mean that a similarly restrictive approach should apply to cases in categories 1 and 2. I agree with Langley J that, if that were so, the exception would swallow up the rule. It is important that it should not do so given that the precise rationale of the rule is debatable; its retention is partly attributable to the desirability of not changing an approach established " for better or worse "; and that the rule is not easily congruent with ordinary principles of construction. Further there is good reason not to apply a more restrictive approach in relation to cases in category 2, where the parties have already contracted on the terms said to be incorporated, than to those in category 1, where the party resisting incorporation is either more or at least as likely to be unfamiliar with the standard term relied on as is the party resisting incorporation in category 2…"
In my judgment, in this case what is involved is clearly a case in which Weco are claiming that a clause in a contract between different parties (PML and Mr Loro Piana) is incorporated, via a contract contained in the Himalaya clause, to govern their non-contractual relationships with the Yacht Interests. This seems to me to be covered by the Thomas v Portsea line of authorities, and I respectfully agree with the Privy Council that those authorities are difficult to square with the proposition that an exclusive jurisdiction clause should be regarded as incorporated by reference via a Himalaya clause.
(3) This latter conclusion is reinforced by reference to the words of the EJC itself, which refer to disputes arising out of or in connection with the booking note. The disputes between Weco and the Yacht Interests arise out of the alleged torts and breaches of bailment on the part of Weco. They do not arise out of the booking note; and only arise in connection with the booking note in the limited manner that they arise out of the actual performance of the carriage undertaken by PML in the booking note. However, whilst there seems to be room for argument in this regard, I would not rest my decision on this ground.
(4) The third consideration identified by Lord Goff was the adventitious result that giving the subcontractor the benefit of such a clause would have. As he said, the EJC would have been chosen by the carrier to reflect a preference for suit in the courts of the place where he carries on business. To extend the benefit of the clause to a party which may well be domiciled elsewhere may mean that all sorts of parties in different parts of the world find that they are entitled and obliged to litigate in the country in which the carrier does business, which is not an obviously desirable result. Such a conclusion clearly goes a long way beyond the original function of the Himalaya clause.
(1) First, Weco placed reliance on the fact that the clause referred to "conditions" and the EJC was such a condition. However, in the Makhutai, the clause also referred to conditions. The question was what sort of condition the subcontractor was entitled to take the benefit of. The answer given was defensive conditions.
(2) Secondly, Weco placed reliance on the reference to conditions, limitations etc "of whatsoever nature". Again, I think that these words must be taken to refer to terms which have the relevant characteristics. Here, the relevant characteristic is that the term gives a right to a defence.
(3) Thirdly, Weco relied on the reference to "rights" in this clause. Again, I do not think that this extension of the wording of the clause meets the fundamental points made by the Privy Council in The Makhutai, which I have set out above.
(1) As I have noted above, that Sea Waybill incorporated an EJC which provided for German jurisdiction. The Sea Waybill also incorporated a Himalaya clause. Hence, Mr Loro Piana argued that Weco, as subcontractors both under the booking note and the Sea Waybill, were parties to inconsistent EJCs and could not rely on either of them.
(2) Weco, for its part, argued that the Sea Waybill had never been intended to be a contract of carriage at all, and referred me to the decision of HHJ Pelling QC in The NorTrader  EWHC 1371, for the proposition that although the parties named in a bill of lading would normally be presumed to be the parties to the contract of carriage evidenced therein, this was not necessarily the case. I quite accept this proposition.
(3) Weco went on to contend that the Sea Waybill was not a contract of carriage at all, because the parties thereto had never intended there to be such a contract. In this regard, reliance was placed on a letter from Zeamarine's lawyers, Holman Fenwick and Willan. As a result, Weco argued that the EJC in the Sea Waybill was irrelevant.
The position as between PMS and Mr Loro Piana.
(1) First, they also argue that they are entitled to the benefit of the EJC by virtue of the Himalaya clause in the booking note.
(2) Secondly, they argue that, by virtue of the "conditional benefit" principle, having sued on the booking note in Italy, Mr Loro Piana is bound by the terms of that booking note including the EJC.
(1) Having identified himself, PML and PMS as the parties, the claim asserts "the agreement entered into between the parties is documented by the "booking note" issued by Peters & May Limited".
(2) He asserts a contractual liability on the part of PMS and asks the Court to "find and declare the contractual and/or tort liability of the defendant companies…"
(3) The contract is asserted by Mr Loro Piana to be a Contract of Carriage within the meaning of the Rome 1 Regulation consistent with the allegation that "the claimant contacted Peters and May Limited…a company specialized in transporting yachts...which it personally engaged to transport the yacht My Song from the Caribbean Islands to Italy at the end of the Winter Season" (emphasis added).
Mr Loro Piana's contentions.
"I have been provided with a copy of the skeleton argument filed by Peters & May
Srl and wish to clarify a point raised in paragraphs 26 to 31 of that document. Mr
Loro Piana's claim against Peters & May Srl in Italy is not based on the Booking
Note. It is no part of his case in Italy that Peters & May Srl is a party to the Booking Note or bound by its terms and Mr Loro Piana does not claim damages against Peters & May Srl for breach of the Booking Note. It was not our intention when drafting the Writ of Summons to make any such argument."
"34. I respectfully agree with the approach of David Steel J. in Sea Premium and with the obiter dictum of Popplewell J. in The MD Gemini . The reason why the jurisdiction clause can be enforced by an injunction in those cases and in the present case is that it would be inequitable or oppressive and vexatious for a party to a contract, in the present case IB Maroc, to seek to enforce a contractual claim arising out of that contract without respecting the jurisdiction clause within that contract. If the approach of Longmore LJ in the Yusuf Cepinioglu is applicable to the present case the reason is simply that IB Maroc, when seeking to enforce a contractual right, is bound to accept that its claim must be "handled through the English courts" as required by the contract in question. As with the claim by Dell UK it is accepted that there is no strong reason for not granting the injunction sought."
"If a party, X, acquires rights arising under a contract between A and B, X can only enforce those rights consistently with the terms of that contract. The principle was crisply explained by Hobhouse LJ (as he then was) in The Jay Bola  2 Lloyd's Rep 279 , at p.286, with regard to rights acquired by insurers from voyage charterers:
"…the rights which the insurance company has acquired are rights which are subject to the arbitration clause. The insurance company has the right to refer the claim to arbitration, obtain if it can an award in its favour from the arbitrators, and enforce the obligation of the time charterers to pay that award. Likewise, the insurance company is not entitled to assert its claim inconsistently with the terms of the contract. One of the terms of the contract is that, in the event of a dispute, the claim must be referred to arbitration. The insurance company is not entitled to enforce its right without also recognising the obligation to arbitrate."
See too, The Tilly Russ, Case C-71/83  ECR 2417 , at  – . These authorities lend no support to Underwriters' case. Nor, for that matter, does Youell v Kara Mara Shipping  Lloyd's Rep IR 553 , at  and following.
57. Secondly, a jurisdiction clause is, by its nature, concerned with proceedings. Had the Bank commenced proceedings against Underwriters to enforce its insurance claim it would, doubtless, have been required to do so in accordance with the English jurisdiction clause contained in the Policy. But it did not do so and that, by itself, is an end of the matter. A mere assertion of its rights, short of commencing proceedings, would not, without more, result in the Bank being bound by the jurisdiction clause in the Policy.
58. Thirdly and in any event, like Teare J, I do not read the Letter of Authority as entailing an assertion of the Bank's rights. I have nothing to add to Teare J's observations (at ) on this point.
59. Fourthly, in the circumstances, it is unnecessary to lengthen this judgment by embarking on a consideration of the position which would or might have prevailed had negative declaratory relief been sought. Suffice to say, it was not.
60. It follows that I would dismiss Underwriters' appeal on this Issue."
"26. The Bank's entitlement to receive the proceeds of the Policy in the event that there was an insured casualty rests on its status as an equitable assignee. It is trite law that an assignment transfers rights under a contract but, absent the consent of the party to whom contractual obligations are owed, cannot transfer those obligations: Tolhurst v Associated Portland Cement Manufacturers (1900) Ltd  2 KB 660 , 668-670 per Collins MR. An assignment of contractual rights does not make the assignee a party to the contract. It is nonetheless well established that a contractual right may be conditional or qualified. If so, its assignment does not allow the assignee to exercise the right without being subject to the conditions or qualifications in question. As Sir Robert Megarry V-C stated in Tito v Waddell (No 2)  Ch 106 , 290, "you take the right as it stands, and you cannot pick out the good and reject the bad". This concept, which has often been described as "conditional benefit", is to the effect that an assignee cannot assert its claim under a contract in a way which is inconsistent with the terms of the contract. Several examples of its application or consideration were cited to the court. See, for example, Montedipe SpA v JTP-RO Jugotanker ("The Jordan Nicolov")  2 Lloyd's Rep 11 , 15-16 per Hobhouse J; Pan Ocean Shipping Co Ltd v Creditcorp Ltd ("The Trident Beauty")  1 WLR 161 , 171 per Lord Woolf; Schiffahrtsgesellschaft Detlev von Appen GmbH v Voest Alpine Intertrading GmbH ("The Jay Bola")  2 Lloyd's Rep 279 , 286 per Hobhouse LJ; Youell v Kara Mara Shipping Co Ltd  2 Lloyd's Rep 102 , paras 58-62 per Aikens LJ; Shipowners' Mutual Protection and Indemnity Association (Luxembourg) v Containerships Denizcilik Nakliyat Ve Ticaret AS ("The Yusuf Cepnioglu")  1 Lloyd's Rep 641;  Bus LR 755 , paras 23-25 per Longmore LJ; and Aline Tramp SA v Jordan International Insurance Co ("The Flag Evi")  1 Lloyd's Rep 467 , para 40 per Sara Cockerill QC, sitting as a Deputy High Court Judge.
27. In my view, the formulation of the principle by Hobhouse LJ in "The Jay Bola" , which the Court of Appeal approved in "The Yusuf Cepnioglu" , is the best encapsulation. In "The Jay Bola" the insurers of cargo for the voyage charterer asserted rights, which had been assigned to them by the voyage charterer by subrogation under foreign law, by raising court proceedings in Brazil against the owners and the time charterer. On the application of the time charterers, Morison J granted an anti-suit injunction against the insurers because the arbitration clause in the voyage charter regulated the means by which the transferred right could be enforced. The Court of Appeal upheld his order. Hobhouse LJ stated ( 2 Lloyd's Rep 279, p 286):
"… the insurance company is not entitled to assert its claim inconsistently with the terms of the contract. One of the terms of the contract is that, in the event of dispute, the claim must be referred to arbitration. The insurance company is not entitled to enforce its right without also recognizing the obligation to arbitrate."
This formulation emphasises the constraint on the assertion of a right as being the requirement to avoid inconsistency and, whether the clause is an arbitration clause, as in "The Jay Bola" , or an exclusive jurisdiction clause, as in Youell (above), it is the assertion of the right through legal proceedings which is in conflict with the contractual provision that gives rise to the inconsistency.
28. In Rals International Pte Ltd v Cassa di Risparmio di Parma e Piacenza SpA  5 SLR 455 , para 55, the Singapore Court of Appeal, commenting on "The Jay Bola" and the proposition that an assignee does not become a party to the contract but would not be entitled to enforce its rights against the other party without also recognising the obligation to arbitrate, stated:
"This approach of entitlement rather than obligation may be more easily reconcilable with the consensual nature of arbitration. This is because the assignee is only taken to submit to arbitration at the point it elects to exercise its assigned right."
29. In the present case the Bank did not commence legal proceedings to enforce its claim. Indeed, it did not even assert its claim but left it to the Owners and the Managers to agree with the Insurers the arrangements for the release of the proceeds of the insurance policy by entering into the Settlement Agreement. It is not disputed that the Bank was not a party to the Settlement Agreement and the Bank derived no rights from that agreement. The Letter of Authority, which the Bank produced at the request of the Owners and the Managers, enabled both the Insurers and Willis Ltd to obtain discharges of their obligations and to that end it was attached to the Settlement Agreement. The Letter of Authority facilitated the settlement between the Insurers and the Owners and provided the Owners/Managers with a mechanism by which the Bank as mortgagee, assignee and loss payee could receive its entitlement. At the time of payment of the proceeds of the Policy there was no dispute as to the Bank's entitlement and no need for legal proceedings. There was therefore no inconsistency between the Bank's actions and the exclusive jurisdiction clause. The Bank therefore is not bound by an agreement as to jurisdiction under article 15 or article 25 of the Regulation.
30. The Insurers argue that, if they had refused to pay the proceeds of the Policy to the Bank and had commenced proceedings against the Bank in England seeking negative declaratory relief, the Bank would have been bound by the exclusive jurisdiction clause. They submit that it makes no sense to distinguish a claim for negative declaratory relief from the Bank's claim. This is because the Bank's right to sue for an indemnity under the Policy and the Insurers' right to sue for a declaration that it is not liable to the Bank are the same cause of action: Gubisch Maschinenfabrik KG v Palumbo (Case 144/86)  ECR 4861 , paras 15-19. This incoherence, it is submitted, militates against the Bank's analysis. I disagree. The Bank is not a party to the contract contained in the Policy. The Bank is not bound by that contract to submit to the jurisdiction of the English courts if the Insurers raise an action in England. If the Insurers' claims fall within section 3 of the Regulation, the Insurers may bring proceedings against the Bank only in the courts of the member state of the Bank's domicile, that is The Netherlands. I turn then to that question."
The position of Credem.
(1) It is not party to the booking note, and thus not bound by the EJC as against PML;
(2) It would not reasonably have been understood to be a party to the EJC, since Mr Loro Piana held himself out as the Owner of the yacht;
(3) It has not sued PMS in Italy, and cannot thus be bound on the principle of conditional benefit;
(4) Weco and PMS cannot rely on the Himalaya clause as against Credem;
(5) Weco's claim against Credem under Article 8(1) fails for the same reasons as does the claim against Mr Loro Piana.
(1) First, Credem was party to the booking note contract. For the reasons set out in relation to Mr Loro Piana, I have concluded that there is an arguable case in this regard.
(2) However, the question that remains is whether PMS are a party to that contract. On the face of the contract, they are not. The service provider is clearly identified as PML
(3) PMS sought to get round this problem by relying on the Himalaya clause. For the reasons set out in relation to Weco, earlier, I have concluded that the Himalaya clause does not extend the benefit of the EJC to PMS
(4) By way of alternative PMS sought to suggest that if they were sued by Credem on the booking note, then they would be entitled to rely on the EJC because of the principle of conditional benefit; and that they could pre-empt the question by suing for negative declaratory relief. In this connection, they relied on the decision in Follen Fischer AG v Ritrama Spa  QB 523. In response, Credem pointed to the decision of the Supreme Court in The Atlantik Confidence, ref supra, the relevant passages of which I have set out above. They submitted that that case made clear that the conditional benefit argument could only apply where a party had in fact commenced proceedings, and here Credem had not. I accept that submission.
(5) Nor do I think that the Follen Fischer case assists PMS. There the question was whether the provisions in the Regulation relating to tort applied to claims for negative declaratory relief in relation to the question of whether there had been no tort, brought in the courts of the country which had jurisdiction in relation to claims in tort. The Court held that such a claim was permissible, since it was the obverse to a positive claim in tort, which could be brought in that jurisdiction. That case is of no assistance in relation to the question of whether a party can bring negative declaratory relief proceedings in relation to an EJC where that party has no current grounds for saying that it is a party to that EJC
Summary of conclusions.
(1) There is a good arguable case that PML is entitled to rely on the EJC as against both Mr Loro Piana and Credem. The Milan proceedings against PML should therefore be stayed, in favour of the proceedings in England.
(2) There is a good arguable case that Weco is entitled to found jurisdiction against PML, Mr Loro Piana and Credem under Article 8(1) of the Recast Regulation. The English Court was first seised of these proceedings.
(3) There is a good arguable case that PMS is entitled to the benefit of the EJC (as against Mr Loro Piana) by reason of the principle of conditional benefit, on the basis that Mr Loro Piana, by (at least arguably) bringing proceedings on the booking note contract in Italy against PMS, became bound to comply with the terms of the EJC. Again, therefore, the Milan proceedings against PMS should be stayed, in favour of the proceedings in England.
(4) This leaves the position as between PMS and Credem. Here, in my judgment, there is no good arguable case that PMS may currently rely on the EJC as against Credem, since they cannot rely on either the Himalaya clause or the conditional benefit argument. Whether they would be able to do so if proceedings were brought is a matter that I cannot and do not determine.
Note 1 Heidelberg Report: (Study JLS/C4/2005/03). [Back] Note 2 See also Lord Hobhouse at . [Back]
Note 1 Heidelberg Report: (Study JLS/C4/2005/03). [Back]
Note 2 See also Lord Hobhouse at . [Back]