The Legal 500

Publishing firms

Legal Developments worldwide

SALES CONDITIONS AND CHOICE OF JURISDICTION WITHIN THE EU

November 2008 - Corporate & Commercial. Legal Developments by Cruyplants Eloy Wagemans & Partners .

More articles by this firm.

A recent decision by the Commercial Court of Hasselt tackled the issue of choice of jurisdiction clauses contained in the sales conditions of invoices in an international sale of moveable goods within the territory of the European Union

Article 23 of the EEX Regulation foresees that parties can agree to designate the competent jurisdiction in case a dispute should arise between the parties. Such an agreement conferring jurisdiction shall be either:

(a) in writing or evidenced in writing; or

(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 of 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.

In the case brought before the Commercial Court of Hasselt, the plaintiff referred to its general sales conditions, which were set out on the reverse side of every invoice, as well as to the already existing trade relationship between the parties, which, according to the plaintiff, implied that the defendant most definitely knew of the sales conditions and thus of the choice of jurisdiction clause contained therein. According to that choice the courts of Hasselt were the agreed jurisdiction.

The German defendant however submitted that the general sales conditions were in Dutch and in French, two languages which the defendant did not master. The plaintiff responded that the defendant must be deemed to have knowledge of French, since French is one of the common languages in international business.

The Commercial Court in Hasselt held that indeed the defendant did not speak Dutch nor French, nor could French be deemed to be a general business language. The Court confirmed that English is the general international business language, as was confirmed by the correspondence between the parties, which was in English.

The lesson from this case is that, on the one hand, it is always dangerous not to react to, and refuse, the other party's sales conditions and, on the other hand, that sales conditions should always be drafted in a language which the other party can be shown to understand.

Yves Stans

For more information please visit www.cew-law.be

Or email yves.stans@cew-law.be

Read full newsletter