Private International Law - Essay Example

?Private International Law Introduction In the area of the law known as private international law or conflict of laws, the controversies analysed andadjudicated are those that pertain to situations which, while domestic, have a foreign element. Many of these have to do with commercial transactions, such as the purchase of an item from a foreign vendor that turns out to be defective. Others have to do with relations among persons, such as the case of marriage, divorce, or declarations of nullity. Still others would be based upon claims to property ownership and tradition, such as the conveyance of objects through testate and intestate succession. In the resolution of cases of conflicts of law, problems arise when the different nationals have different rights and claims under their own laws, and at times the law of the place and the law agreed upon in a contract add a third or fourth consideration as to which set of laws shall apply in settling the case. There are three important determinations to be made prior to even beginning to address the substance of the case. The first is that of jurisdiction, and the second is the choice of law, and third is the matter of enforcement of the judgment. In this essay, only the first two shall be considered. Jurisdiction refers to the power to legislate or adjudicate with effect. It is the first question to be decided in a dispute involving a foreign element.1 Proceeding to hear a case without the proper jurisdiction is fatal to the case under that tribunal, and can only be remedied by a change of venue. The second important consideration is that of the choice of law. Once the English court has accepted and affirmed jurisdiction, it has then to determine what system of law must be applied to the dispute, pursuant to which the rights and liabilities of the parties shall be determined.2 There are two contexts of jurisdiction – territorial jurisdiction, and power jurisdiction.3 The first, territorial jurisdiction, pertains to the determination of which persons are within the reach of the courts of England, as claimed by English law. Contrary to the term’s implied meaning, this jurisdiction may extend beyond the physical boundaries of England and Wales (where this law is applicable), where English nationals over which the English legal system claims jurisdiction may sojourn outside the geographical territory of England and Wales. The second context in which jurisdiction may be taken refers to the power jurisdiction, that is, the situations and circumstances where the English courts may actually gain power to adjudicate a particular case involving persons who are within the territorial jurisdiction of the court.4 In order for an English court to gain competence over a case, said court should gain both territorial and power jurisdiction over the case. In private international law, the characterisation of issues subject of claim is the prerogative of the court of the forum.5 The case of Brian First claim: The consignment of biscuits from Bleagh Spa The claim of right in this case is one that arises out of contract. A contract of sale for Italian biscuits was drawn between Brian and Italian food supplier Bleagh Spa for the delivery of biscuits specified to be Italian. Instead, Bleagh had delivered Liechtenstein biscuits, which were unsuitable for the purpose for which they were bought, as such products should be sold in an Italian restaurant as Italian fare. This constituted a breach of the terms of the contract which specified the goods to be Italian. As such, Brian had a claim of right against Bleagh, one that constitutes a dispute of the fulfilment of a contract that is of a commercial nature. . Jurisdiction As to the domicile of the parties, it is specified that Brian is domiciled in the U.K., being a British national and living within the U.K. as permanent resident. Bleagh Spa, on the other hand, is an Italian business organisation, and in the absence of other information, is presumed to be domiciled in Italy. The conflict of laws problem therefore arises between the two as contractual parties to a contract of sale in breach. Before jurisdiction may vest in the court, however, the validity and enforceability of the contract must be established. The validity as to form is determined by lex loci actus, or the law of the place where the transaction took place, although its enforceability is governed by lex contractus, or the law intended by the parties to apply in case a dispute arises. In the facts given, neither detail had been mentioned, in which case the validity and enforceability of the contract in its present form are presumed, and that the law intended by the parties to govern the contract is English domestic law. The situs of the breach is in the U.K., where delivery was to have been made and the sale therefore consummated. The claim of right, being based on the alleged breach of the terms and conditions of a contract, is actionable. It arises out of the non-fulfilment of the implicit warranty of the vendor that the goods delivered are of the quality and quantity specified in the contract of sale. The English courts should therefore have territorial jurisdiction over this case. Choice of law in the case of English court Assuming the case to be filed in the English court, it is incumbent upon the court to establish its jurisdiction by determining whether or not the parties intended for those disputes arising from the contract to be settled under English law. Where this is silent, jurisdiction may be assumed by the court by the consent of the parties to the case: the plaintiff, Brian, by his action of filing the claim with an English court, and Bleagh Spa, by its response to the summons and the filing of its unqualified answer to the substance of the claims against it filed by Brian. In the case that the answer file by Bleagh constitutes a question posed to the jurisdiction of the court, alleging that the court had no jurisdiction, then such an answer does not imply acceptance of jurisdiction, and therefore the “power” jurisdiction is not yet vested despite presence of territorial jurisdiction. Second Claim: The automobile accident The second claim of Brian arises out of the automobile accident that occurred along a road in the Netherlands. The incident involved another motorist, Jos, a Dutch journalist. Some damage was sustained by Brian’s car, but only minor injuries were suffered by him as a result of the accident. There was no factual statement of the culpable party or the circumstances of the incident; however, for the purpose of analysis, it is presumed that Jos is the party more at fault in the incident, because of the slight injury and damage sustained by Brian giving rise to a cause of action on his part, and the fear of Jos that Brian would file suit against him as a result of the accident. Jurisdiction It has been established that Brian had been domiciled with his wife in the U.K., and as such may be subject of jurisdiction by the UK courts. Jos, the other party in the accident, is a Dutch national domiciled in the Netherlands where the tort or delict took place. The particulars of the accident had not been given, however, it has been mentioned that while only minor physical injury was sustained by Brian, his car had sustained substantial damage. The case, therefore, is one of either tort or quasi-delict, having been caused by the negligent act of the other party although no malice was intended. The nature of the accident is dependent upon the specific circumstances surrounding the incident. In any case, since the claim to be pursued is anchored on material loss due to tort or delict, such a situation would necessitate recovery and restitution, even in the Dutch law. The cause is therefore actionable and may be subject to judicial proceedings. For the purpose of this analysis, because the case facts specified that the collision was due to an accident, then no malice is assumed. Choice of law in the case of English court The rule of conflict of laws, Part III of Private International Law (Miscellaneous Provisions) Act 1995, or PILA, deals with claims in tort or delict. Section 11(1) to (3) expresses the general rule on the determination of the choice of applicable law where the events subject of judicial determination is that of the country where the events that comprised the tort or delict had occurred. In case the elements of the events had taken place in more than one country, the applicable law, pursuant to the general law, is dependent upon the circumstances of the events. First, for a cause of action in respect of personal injury or death that resulted from the personal injury, the applicable law is the law of the country where the individual was when he was injured. Secondly, for a cause of action respecting damage to property, the applicable law is where the property was located when it was damaged. And finally, in any other case, the applicable law should be that of the country where the most significant element or elements of the events (which are the cause of action) have occurred. There are exceptions to the general law given in the preceding paragraph. Where, for instance, there are factors present that would relate the tort or delict more closely with the law of a country other than that country whose law should be applicable, according to the general rule, then under such circumstances the general rule is displaced and the law of that other country is applied to the issues relating to the tort or delict. Such factors to be considered may relate to the parties, the events, or the circumstances surrounding them.6 In this case of the motoring accident between Brian and Jos, there had been no other factors present that would relate the event more intimately with the law of another country, other than the Netherlands. The tort or delict occurred in the streets of the Netherlands, with a Dutch national as one party to the incident. Any consideration as to traffic laws, road conditions at the time of the incident, and disposition of the motorists would pertain to the Netherlands and no other location. For the purposes of jurisdiction, therefore, the UK law recognizes the jurisdiction to be that where the event occurred, for the filing of an action for recovery as a result of tort or delict. Third claim: Jos’ threat to blackmail This possible claim has reference to the attempt by Jos, a Dutch nationalist with whom Brian had a motor accident on the road in Netherlands. The facts state that Jos had found photographs of Brian in compromising positions with a woman who was not his wife, and threatened to spread such photos in the internet if he (Brian) files a complaint against him (Jos) with regard to the accident. From the outset, it appears that Jos is committing a felony by apparently blackmailing Brian with the embarrassment of having his pictures with the woman spread over the internet. However, Brian’s concern does not concern any harm that may be inflicted upon his person or his reputation, as what he feared was that his wife would find out about his infidelities and indiscretions. The act that Jos threatens, therefore, is not against the law, neither is it a felony, because what he proposes is merely right and just – to inform the wife of her husband’s philandering. When a threat is made the circumstances of which are not contrary to law and is therefore not unwarranted, then such is not a demand in the contemplation of the law on felonies. What may appear at first to be blackmail actually is not, because it proposes to inflict no unlawful harm upon Brian; furthermore, neither is it in contemplation of some gain,7 it being more in the nature of a compromise – to give up the suit in return for not being exposed to his wife. In this case there is no felony and no actionable cause subject of a lawsuit. Because there is no actionable cause, then courts cannot assume jurisdiction, and no choice of law situation arises. Rosa’s Action: Petition for Divorce Divorce is a proceeding whereby the parties to a valid marriage petition to dissolve the marriage and restore each party to the status of a single person. The juridical nature of the problem, therefore, is for the court to determine if, pursuant to the law of the U.K., the couple is entitled to a dissolution and a subsequent partition of their properties. The proceedings are civil in nature, and inasmuch as domicile jurisdiction may vest pursuant to the law on divorce in the UK. Jurisdiction Under common law, the determination of jurisdiction for divorce proceedings was solely anchored by statute on the domicile of the parties. There have been cases, however, where the court exercise its jurisdiction where one of the parties was not domiciled in England. Such was the case of Zanelli v Zanelli,8 where the Italian husband and English wife were married and living and England prior to the deportation of the husband to Italy. The wife subsequently filed for divorce and was successfully granted one under English law, despite the husband already being domiciled in Italy at the time. Presently, under the Act of 1973, there no longer exists a statutory rule on the choice of law in the case of divorce and judicial separation. The Law Commission intended that in the reforms leading to the 1973 Act, that English domestic law should apply whether or not the parties are domiciled in England and Wales. The case is different for nullity, where jurisdiction to entertain proceedings vests only if either of the parties to the marriage: (1) has his/her domicile in England on the day the action is commenced; and (2) he/she has been a habitual resident during the one year period prior to the date the action is filed ; or (3) that he or she died prior to the commencement of the action, or had habitually residing in England for a period of at least one year culminating in the filing of suit for divorce.9 In this case, there is no question but that the couple is domiciled in the U.K. Brian is a U.K. citizen, while Rosa is Polish, and the place of the celebration of their marriage is in Poland. Before the English court could obtain jurisdiction over their divorce proceedings, it must first be established that the marriage is legal and binding. The formalities that determine the validity of a marriage are governed by lex loci celebrationis, or the law of the place where the marriage was celebrated. In this case, the law of Poland on the formalities of the celebration of marriage should have been followed, otherwise the marriage is either void or voidable. If it is void ab initio, then there is no marriage to speak of, and therefore no divorce proceedings may take place. Either of the couple may file for a declaration of nullity.10 If it is voidable, then the couple has the option of either filing for a declaration of nullity from the courts, or filing for divorce. Aside from the formalities of the marriage ceremony, however, it is also important that both Brian and Rosa had the capacity to enter into marriage when they did. Capacity is determined by the law of the country of nationality of the person. If, in any case, the marriage is valid, then divorce may take place, at which time Rosa may file for divorce either in England, where they are domiciled, or in Poland, where the marriage was celebrated. Should the divorce be filed by Rosa in the country where their marriage was celebrated in, assuming that the divorce is governed by judicial proceedings and the pronouncement issued by the court, then the divorce would be recognized in England if: (1) either party to the marriage was habitually resided in that foreign country; or (2) that either of the divorcing parties was domiciled in that country; or (3) if either of the parties to the marriage was a national of the party where the divorce was filed.11 In this case, Rosa being a Polish national, divorce proceedings filed in Poland would be valid and cognizable in England. In the case, however, where Rosa obtains an extra-judicial divorce, assuming such a custom to be valid and recognizable under Polish law, even if Polish law considers it valid, the same would not be given due legal effect in England. This is in accordance with the English law12 which provides that an overseas divorce, annulment, or legal separation obtained by means other than by judicial proceedings, shall be recognized only if: (1) the divorce, annulment, or legal separation is valid and effective under the law of the country where it had been obtained; and (2) at the date such divorce, annulment or legal separation took effect, either: (a) each party to the marriage was domiciled in that country where the process took effect; or (b) either one or the other party to the marriage was domiciled in that country and the other party was domiciled in a country under whose law the extrajudicial proceeding for divorce, annulment or legal separation is recognized as valid; and (c) neither one nor the other party to the marriage was a habitual resident in the U.K. throughout a period of an entire year immediately preceding the date of the extrajudicial proceeding. In the case of Rosa and Brian, therefore, any extrajudicial proceeding that Rosa may undertake in another country to effect their divorce, whether or not such proceeding is valid and recognized in that country, cannot be recognized in the U.K. This is because the circumstances surrounding the lives of Brian and Rosa as husband and wife prior to the divorce do not meet the provisions set forth in Section 46(2) of the Family Law Act 1986. Both Brian and Rosa were not domiciled in that other country (assuming Poland), both being domiciled in England. Choice of law in the case of English court In the case of divorce law proceedings, the choice of law, if the petition for divorce were to be filed in an English court, would be English law. Pursuant to English law, no divorce shall be recognized except those that have been granted judicially.13 In other countries, extra-judicial divorces are allowed, but there are no such proceedings under UK law. Critique of choice of law rules applicable to succession to property One of the means by which property rights may transfer from one individual to another is through succession. Property rights may be transferred from one person to his heirs by two means, either through donation inter vivos or mortis causa. The first is made during the lifetime of the donor and at his pleasure, while the second takes takes legal effect at the time and by virtue of his passing. In those cases where the testator or decedent and the successor are both domiciled in one country and all the properties subject of succession are likewise found within the same country, then there is little question of jurisdiction and choice of law, both pertaining to the country of domicile of both parties. A problem arises, however, where the decedent and the successor are domiciled in two different countries with different regimes on succession, and which may be further complicated by the location of the properties if they are found in different countries. Prior to the determination of choice of law, it is important that jurisdiction be established, pertaining to both territorial and power jurisdiction. Jurisdiction vests in the court over the disposition of the estate of the deceased person, where (1) the decedent was domiciled in England when he/ she died; or (2) the decedent was a national of the country whose laws are made to govern; and (3) those locations where the properties, if there are several, are situated. While the jurisdiction vests in one tribunal, there may be several laws that may be made to govern, depending upon whether the estate consists of movables or immovables, and whether the deceased had died leaving a valid will (in the matter of testate succession) or without a will (in the matter of intestate succession). When a person dies intestate, the court shall distribute his estate according to what is presumed to be his will, a matter that is fixed by law. In the UK, the distribution of the intestate estate shall depend upon whether the property is classified as movables or immovables. Movables are distributed according to the law of domicile of the deceased at the time of his death.14 To illustrate, the deceased had properties in England although he was domiciled in Austria.15 He died intestate and had no heirs, therefore the Austrian State claimed the properties by virtue of the law of the domicile of the deceased. This claim was rejected by the English court, arguing that the issue involved administration instead of succession. As such, the property reverted to the Crown as bona vacantia.16 In a similar case, a person in the state of domicile claimed the property in England in his capacity as ultimus heres, and the English court conceded that the claim was one of succession, thereby according the claimant the property.17 In contrast to movables, immovables are governed by the lex situs without regard to the domicile of the deceased. The problem this creates is that there would be as many regimes as there are countries where the decedent’s properties are located. This occurred in a case where a widow had been able to secure a $ 1 million settlement against an ex-wife and other claimants, for her husband’s estate in Trinidad Tobago. She thereafter claimed her full “statutory legacy” in the estate of the deceased in England, by virtue of Section 46(1) of the Administration of Estates Act 1925.18 Although it did result into an unfair enrichment on her part to the detriment of the other heirs, the High Court awarded her the estate with great reluctance.19 In the matter of testate succession, a common problem exists where the lex situs of other countries provides for legitimes that limit the testator’s prerogative in bequeathing his properties. In one case, a British subject died in her domicile in Italy. Her wills concerning her estates in Italy and England excluded her son from receiving anything, which was acceptable as far as English law is concerned, but not as to Italian law. The succession law in Italy required that a certain portion of the deceased’s estate should be given to certain mandatory heirs, and failing to do so results in preterition. The son contested the validity of the wills in English court, which, applying the doctrine of renvoi, referred the essential validity of the wills to Italian law relative to both the immovables as lex situs, and her law of domicile. Evidence showed, however, that Italian law would apply the law of the testator’s nationality; therefore, the wills were held to be valid, and disposition of the testator’s property in England still excluded him pursuant to English law.20 There exists a discrepancy between the English law use of the domestic distinction between real and personal property, and that of the choice of law rules on property where the distinction is between movable and immovable property. While the existence of a difference between the local classification and the application under choice of law in private international law application, the difficulty in such difference in classification becomes apparent in the case where competing laws capable of application resort to various legal institutions in obtaining the necessary relief. The different legal applications may result in a decision being unfair to one of the parties by giving the other party an undue advantage not contemplated by the spirit of the law.21 The UK’s rules on the choice of law in the case of succession to property remains in effect as the country has opted not to be included in the EU legislation on succession and wills. A draft of the legislation is being crafted, nevertheless, with the assistance and in consultation with the UK such that areas presenting difficulty could be analysed and worked out. The draft regulation is intended to eventually establish a uniform set of rules on jurisdiction, choice of law and the international recognition and enforcement of judgments, on the regulation of property rights conveyed by succession. The initiative does not yet aim to fully harmonise the national laws governing succession and wills in the EU’s Member States, although this possibility is not excluded for the long term. Conclusion The field of private international law continues to present challenges as national laws evolve to accommodate the jurisdictional and choice of law issues involving other countries. The EU is capable of more aggressively embarking on attempts to create uniform rules that would eventually lead to a harmonised regime, which in a sense is essential in the single market, single economy set-up. For the reasons stated by the UK in opting out of several of these conventions and regulations – that the currency is an international reserve and its economy of the country is too strong that opting in may destabilise it – the UK is well justified; however, as far as private international law is concerned, it shall continue to deal with differences in its regime in relation to the rest of Europe. Conflict of laws doctrines shall merely continue to evolve between the UK legal system, that of the EU or what it will eventually be, and the rest of the world. Bibliography Albury, Sarah; Ingham, Judith; Matthews, Paul; & Morgan, Samantha. “EU study on the international law of succession.” Competence Internationale. pp. 671-706 Alford, Duncan. “Update: A Guide on the Harmonization of International Commercial Law.” Hauser Global Law School Program. Centre for Social Justice European Family Law: Faster Divorce and Foreign Law. 2009 Westminster Palace Gardens: The Centre for Social Justice Collier, J. G. Conflict of Laws. Third edition. Cambridge, UK: Cambridge University Press, 2001 Dicey Albert Venn; Lawrence Anthony Collins, and John Humphrey Carlile Morris, Dicey & Morris on the conflict of laws, Vols, 2& 4, 13th ed., 2000, Marsh Wall, London: Stevens & Sons Limited Fairbairn, Catherine. Draft EU legislation on succession and wills. House of Commons Library. 18 November 2010. Mayss, Abla, Principles of Conflict of Laws, 3rd edition. London: Cavendish Publishing Ltd., 1999 O’Hara, Erin Ann & Ribstein, Larry E. “Conflict of Laws and Choice of Laws”. 9600 George Mason University School of Law. Accessed from http://encyclo.findlaw.com/9600book.pdf Pitel, Stephen G.A., “Characterisation of Unjust Enrichment in the Conflict of Laws” in Understanding Unjust Enrichment, Neyers, J.W., Mitchell McInnes, & Stephen G.A. Pitel, eds., 2004, Portland, Oregon: Hart Publishing, Ruhl, Giesela “The Problem of International Transactions: Conflicts of Laws Revisited” Journal of Private International Law, vol. 6, no.1, pp 59-91 Thrope, Jessica “Choice of Law and the International Arbitration Agreement,” Dispute Resolution Journal, November 1999, pp. 18-23, 78-87 Watt, Horatia Muir “European integration, legal diversity and the conflict of laws.” The Edinburgh Law Review. 2005 Vol. 9, pp. 6-31 Statutes Domicile and Matrimonial Proceedings Act 1973, Section 5(3) Family Law Act 1986 Section 44 & Section 46(2) Marriage with Foreigners Act 1906, Section 1 & Section 2 Matrimonial Causes Act 1973, Section 11 Private International Law (Miscellaneous Provisions) Act 1995, Part III Sec. 9(2) & Sec. 12 (1) (a) and (b) and (2) Theft Act 1968, Section 21 Case Law Harding v Wealands [2006] UKHL 32 In Re Barnett’s Trust (1902) 1 Ch 847 In Re Collens [1986] 1 All ER 611, Ch 505, 2 WLR 919 In Re Maldonado (1954) P 223 In Re Ross (1930) Ch 377 Mercedes Benz v Leiduck, [1996] AC 284 Zanelli v Zanelli, (1948) 64 TLR 556 Read More