Court of Cassation, Full Court, 5th of July 2017, No 16601

On the 11th of May 2018, I attended the conference on Punitive Damages and European Private International Law: State of the Art and Future Developments, in Milan. The judgment of the Full Court of Cassation, of the 5th of  July 2017, No 16601, was thoroughly discussed (and critizised by some speakers). An English translation of the judgment was also circulated during the conference.

Below is the English version of the Italian comment to the judgment I wrote and originally published in http://www.bbmpartners.com on the 3rd of October 2017. The full text of the jdugment is easily retriavable on the web, for instance at this link: https://www.lavorodirittieuropa.it/sentenze/sentenze-danni-puntivi/80-cassazione-civile-sezioni-unite-sentenza-05-07-2017-n-16601.

“Judgments awarding sc. punitive damages undergo the public policy test”

International public policy has recently hit the headlines with court order n. 16/9978 (an “ordinanza di remissione”, i.e. a request for a preliminary ruling made by a division of the Court of Cassation and addressed to its Full Court), by which the Full Court of the Italian Court of Cassation (hereafter, “Full Court”) has been asked to consider whether decisions – rendered in the United States – awarding sc. punitive damages, which up to then had been considered as being incompatible with the Italian law system, may be recognized and enforced. In particular, the question raised in the court order is to assess whether the principles enshrined in the Italian law system have changed, or whether, following European law, public policy constraints of Article 64 of Law 218/1995 (i.e. the Italian Private International Law Act)[1] have loosen, so as to allow the recognition and enforcement of the mentioned decisions.

In European courtrooms, the public policy limit has often been raised against the recognition and enforcement of decisions – rendered in the United States – ordering compensation of sc. punitive damages, a legal instrument that unveils a significant difference between the objectives underlying tort law in European and North American countries.

In fact, whilst European tort law systems usually pursue a compensatory objective, in North American countries tort law also pursues a punishing purpose.

In particular, in Europe, the principle according to which tort law aims at restoring the statu quo ante – and thus, at compensating a loss – has been long established. As underlined by scholars (Zeno-Zencovich), in mainland Europe, the punishing feature of Roman tort law was eliminated by the doctrine of natural law, when tort law was limited to its compensatory objective. The same evolution occurred in English law, when, during the second half of the fourteenth century approx., the action of trespass, of a criminal and punishing nature, evolved into the action of trespass on the case, of a private law and compensatory nature. Conversely, overseas, the legal instrument has maintained, aside the compensatory one, a punishing purpose. Such purpose is pursued through exemplary (or punitive) damages, whereby the tortfeasor is punished in an exemplary way, in order to discourage him from doing other wrongs.

The English law system, though a system of common law as that in force in most North American countries, is yet reluctant towards the legal instrument of punitive damages. Also Germany, France and Italy have refused the recognition and enforcement of judgments rendered in North American countries awarding punitive damages.

This negative attitude is well pictured in a judgment rendered by the Bundesgerichthof in 1992, where the recognition of a Californian judgment awarding punitive damages was refused, as being contrary to German public policy. According to the court, the German law system did not allow that compensation of damages could be higher than the damage suffered. Moreover, the German Supreme Court held that to permit punitive damages would have entitled private parties to use punishing power, which may only be exercised by State authorities.

Similarly in Italy, in 2001, the Venice Court of Appeals (Venice CA, 15/10/2001) refused the execution of a North American judgment awarding punitive damages. The opinion held by the Court of Appeals was maintained by the Court of Cassation (Italian Court of Cassation 07/1183 and 12/1781) that, as mentioned, refused the recognition of judgments awarding punitive damages, as being inconsistent with the fundamental principle by which tort law pursues a compensatory objective and may not pursue a punishing one.

Also French commentators and judges refused the recognition of judgments awarding punitive damages. In fact, they held that punitive damages were inconsistent with the fundamental principle of the sc. reparation intégrale, under which tort law may only grant a compensation and rather not an enrichment (or loss).

This negative attitude towards the legal instrument of punitive damages has come to an end.

In fact, as noticed in the above mentioned in court order n. 16/9978, following a decision of the Spanish Supreme Court of 2001, the German Constitutional Court in 2007 first and the French Court of Cassation in 2010 then, have maintained that judgments awarding punitive damages are not per se inconsistent with the respective notion of public policy. Moreover, such courts have also maintained that the requested judge must assess whether the recognition and enforcement may actually breach the rule by which tort law pursues only a compensatory objective. To that aim, for instance, French courts have introduced the sc. proportionality test, which consists in assessing the difference between punitive damages awarded and the actual loss suffered.

In this new scenario, of a changed attitude amongst European law systems, by its decision n. 17/16601 the Full Court has answered the questions raised by the First Division of the Italian Court of Cassation with its court order n. 16/9978.

The disputed case brought before the Italian Supreme Court – as may be understood from its own decision – is the following.

During a motocross race, a racer was injured because of an alleged defect in the helmet he was wearing when the accident occurred. The helmet, produced by an Italian company, was imported in the United States by a North American company and resold to the racer by a company in Florida. Following the injury, the racer summoned the reseller, the distributor and the producer to appear before the Broward County Court in Florida, seeking compensation for damages, which he claimed amounted to 10 – 30 million dollars.

While proceedings were pending, the claimant reached a settlement with the distributor: in change of one million dollars, the former waived all claims against the latter. Before entering the agreement, the distributor notified the producer of the settlement, without gaining any reply from the latter.

Under the rule of the sc. product liability test, by its judgment, the seized judge held that the producer should have held the distributor harmless (i.e. should have paid the sum of one million dollars the latter had paid the claimant). In fact, under the rule, when the distributor makes a settlement with the injured party, the producer has the choice either to approve the settlement, in which case he will be bound to its effects, or challenge it by standing in defence of the producer. In fact, though having the right, the producer had not challenged the settlement, nor had he stood in defence of the distributor.

Upon the distributor’s request, the judgment rendered by the Broward County Court was thus recognized and made enforceable in Italy by the Venice Court of Appeals. By filing an appeal before the Court of Cassation, the producer challenged the enforcement. Put simply, by one of the grounds of appeal raised, the appellant averred that the enforced judgment was contrary to public policy under Article 64 of Law n. 218/1995, considering the excessive compensation awarded to the injured party, also by reason of punitive damages. To back his argument, the appellant cited judgments by the Court of Cassation, where, as mentioned, judgments ordering compensation of punitive damages where held as being contrary to public policy.

By its judgment, the Full Court, in first place, underlined that the duty to compensate did not arise from the enforced judgment, but rather from the underlying settlement. Moreover – the court further argued -, the settled compensation of one million dollars was not excessive, especially in the light of the initial amount claimed by the injured party, between ten and thirty million dollars. Nor the punitive nature of compensation could have been suggested by the lack, in the enforced judgment – or better, in the underlying settlement –, of a clear distinction between the different parts of the awarded compensation.

The ground for appeal was dismissed and though the enforced decision did not award punitive damages, yet the Full Court moved on by addressing the issue whether the Italian law system admits judgments awarding punitive damages.

Firstly, the Full Court examined that, few years earlier, in line with the Constitutional Court’s case law, the Court of Cassation had embraced the sc. multifunctional doctrine of compensation: in the Italian law system, tort law pursues, a part from the one of compensation, also a punishing objective. Furthermore, the Supreme Court (Italian Court of Cassation, Full Court, n. 15/9100) had also specified that the punishing objective may be pursued as far as a statutory rule so expressly provides, in accordance with the principle by which punishment is allowed only where it is provided by statute (sc. riserva di legge) under Article 25(2) Italian Constitution (and Article 7 ECHR). Moreover, as stressed in court order n. n. 16/9978, the Full Court underlines that, actually, the Italian law system provides tort law instruments that pursue, among the rest, a punishing objective (for instance, the well known legal instrument provided for in Article 96(3) of the Italian Civil Procedure Code, on contempt of court).

Hence, whilst the punitive nature of compensation is being recognized in the Italian law system, that nature is slowly disappearing in North American countries. The Full Court in fact considered that the United States Supreme Court has taken a contrary position against grossly excessive compensations, and has also held that the punishing objective may not exceed the compensatory one (Exon case). Moreover, the judges from piazza Cavour have also considered that in certain North American countries – amongst which Florida – punitive damages are governed by statute.

In essence, the court has held that judgments rendered in North American countries that award punitive damages are not contrary to public policy, since the punishing objective they pursue is common to the Italian tort law system, provided that they are grounded on a statutory provision, as required by Article 25(2) of the Italian Constitution.

Thus, the Italian judge is not exempted from assessing whether or not similar judgments may be recognized and enforced. In fact, the Full Court conclusively states that, a part from the requirement of a statutory ground as per Article 25(2) of the Italian Consistution: “the recognition of a punitive compensation must in any case by assessed in view of the effects that the decision of the foreign judge may have in Italy, by the broad assessment that must be made, in case of foreign decisions, when implementing an unknown legal instrument though not incompatible, in general, with the legal system”.

Before coming to the merits of the decision, it must be said that, actually, in the Italian law system a provision concerning the recognition and enforcement of foreign judgments awarding punitive damages already exists. This is a private international law provision which is often forgotten – as the Full Court has –., possibly due to its meagre practical interest: Article 11(1) of the 2005 Hague Convention on choice of court agreement (that has been ratified only by the European Union, Mexico and Singapore). The article provides: “Recognition or enforcement of a judgment may be refused if, and to the extent that, the judgment awards damages, including exemplary or punitive damages, that do not compensate a party for actual loss or harm suffered”. Therefore, if a requested judgment awarding punitive damages were ever rendered by a Mexican or Singaporean judge – having jurisdiction by virtue of an exclusive choice of court agreement compliant with the requirements provided for in the Convention –, the provision would entitle the Italian requested judge to refuse recognition. It is thus clear that this is a quite unlikely case… In any case, furthermore, Article 11 of the Convention has been maintained in Article 9 of thel 2016 Judgments Project Preliminary Draft, that is the treaty on the recognition and enforcement of foreign judgments that is being at present negotiated at the Hague Conference on Private International Law.

Article 11 of the Hague Convention and 9 of the draft convention, are the result of the continuing reluctance raised by certain law systems – and, in particular, European ones – against the legal instrument arriving from the United States, which embodies the punitive objective of tort law; and perhaps the appellant could have mentioned them to back his arguments before the judges of the Court of Cassation.

Finally, coming to the merits of the Full Court’s decision, foreign judgments awarding punitive damages are not per se contrary to the concept of public policy provided for in art. 64 Law n. 218/1995, since the punishing objective of tort law is acknowledged also in the Italian law system. Nevertheless, this does not mean that similar judgments may be automatically accepted in the Italian law system. On the contrary, the Full Court provides the requested judge with ample discretion to refuse recognition. In fact, the latter may determine – according to his own discretion and under his own rules – whether damages awarded are punitive or not. Therefore, whenever the Italian judge deems the award as being punitive, the related judgment may enter the Italian law system only if it is based on a statutory rule of the foreign State. In essence, a part from raising the limit of the statutory ground, the Full Court introduces in the Italian law system the solution that has already been introduced in France, that is the proportionality test, which implies, necessarily, on the one hand an in depth examination of the requested judgment, and on the other hand the requested judge’s ample discretion.

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How to serve an Italian judicial document in the United States under Subsection (a) of Article 10 Hague Service Convention

Summary + judicial document + Relazione di Notifica; or judicial document + convenience translation + Relazione di Notifica

Stella, a friend of mine, who practices as a trainee solicitor in a law firm in my town, recently asked me to help her serve an Italian court order on a defendant domiciled in the US.

The court order she had to serve was a sc. decreto ingiuntivo, an order issued by a judge following a summary ex parte proceeding, directing a party to pay or deliver, sought by who claims a specific sum of money, or a specific amount of fungible goods, or the right of being delivered with a specific movable, and granted to who provides a written evidence of his claim (see Articles 633 and ff. Italian Civil Procedure Code). Where the court order is issued, the claimant must serve it on the defendant, who may challenge it within 40 days or else it becomes enforceable.de

Given the meagre value of the claim, Stella was looking for the cheapest way to serve the judicial document, which I suggested was serving it by mail under Subsection (a) of Article 10 1965 Hague Service Convention (“Provided the State of destination does not object, the present Convention shall not interfere with a) the freedom to send judicial documents, by postal channels, directly to persons abroad (…)”) (1).

Both Italy and the US are parties to the Convention, which respectively came into force on the 24th of January 1982 and on the 10th of February 1969 (2).

Though the US has made no objection as to Article 10, I warned Stella that, in the light of the case law of the Italian Court of Cassation, serving judicial documents by that means to the United States may raise an issue.

Article 8 Italian Law No 890 of the 20th of November 1982, provides that where a judicial document is sent by registered letter with return receipt and the recipient does not pick it up, he may do so within 10 days, by collecting the letter at the local post office, or else the judicial document will be considered as having been actually served on him.

By its judgment No 7307 of the 26th of March 2010, the Second Division of the Italian Court of Cassation, came to the conclusion that the mechanisms provided for in Article 8 does not apply where the registered letter with return receipt containing the judicial document is sent abroad, since foreign postal offices do not comply with the requirements set in that Article, which are purported to grant the recipient. In particular, the Supreme Court, held that such a mechanism could not apply in the case of Florida, where uncollected registered letters are held at the local post office only five days.

I thus warned Stella that if the recipient did not pick up the registered letter, nor collect it at the local post office, then the judicial document therein enclosed could have not been considered as having been duly served.

This notwithstanding, Stella decided to try and serve the judicial document by registered mail.

Hence, we filled in the “Summary of the document to be served” (3), which, though recommended by the Fourteenth Session of the Hague Conference (4), is not compulsory when serving judicial documents under Article 10. Under the summary we then attached the application for the court order and the court order itself, and under that we further attached a convenience translation I made.

The reason why I suggested to attach a convenience translation is the following.

In its judgment No 3919 of the 17th of February 2011, the First Division of the Italian Court of Cassation, specified that, unlike Article 5 thereof, Article 1965 Hague Service Convention does not require that the judicial document be translated in the language of the place where it ought to be served. In the case settled by the Supreme Court, actually the claims made by the addresee of the judicial document were deemed wholly ungrounded, insofar as the document had actually been translated.

Hence, the reason why I suggested to attach a convenience translation under the court order was to avoid the defendant from challenging that a translation is needed under Article 10.

Therefore, under the summary, the application for the court order, the court order itself and the convenience translation, we attached the sc. “Relazione di Notifica”, a document that is filled in by the Italian judicial officer and usually worded as follows: “Today, the [date], as requested by [name of the claimant], represented, defended and domiciled as specified above, the undersigned [name], judicial officer at the First Instance Court of [name of the competent court], has served the above application for the court order and the identical court order on [name of the defendant], domiciled in [address where the defendant is domiciled] and therein by mail”.

We stapled all documents together, in the order detailed above, and Stella went to the judicial officers at the First Instance Court of Asti, who then sent the judicial document by registered mail. What Stella told me is that the judicial officers in Asti told her to remove the summary, since the judicial document was provided with a convience translation.

Some weeks later, the judicial document was collected by the recipient and thus duly served.

(1) The 1965 Hague Service Convention is available at: https://www.hcch.net/en/instruments/conventions/full-text/?cid=17

(2) The status table of the 1965 Hague Service Convention is available at: https://www.hcch.net/en/instruments/conventions/status-table/?cid=17

(3) The “Summary of the document to be served” is available at: https://www.hcch.net/en/publications-and-studies/details4/?pid=6560&dtid=65

(4) https://www.hcch.net/en/publications-and-studies/details4/?pid=26&dtid=2

Milan Court of Appeals, 8th February 2013 (A.G. Alvalle S.A. v. Eichweber R. and Eichweber G.)

Under Art. 14 IPILA, which enshrines the iura novit curia (i.e. “the judge knows the law”) principle, the judge must ascertain the contents of the foreign law in order to assess whether or not the requirement of reciprocity is met, under Art. 16 Preliminary Provisions.

The contract for the purchase of an immovable situated in Italy by a Swiss company is null under Art. 16 Preliminary Provisions, since, in similar circumstances, an Italian company may not buy an immovable situated in Switzerland.

Facts

In 1999, a Swiss company entered into a contract for the purchase of an immovable situated in Italy. Among other provisions, the contract read: “the buyer, a Swiss company […], states that the purchased immovable will be used as the company’s seat. This statement is also made to meet the requirement of reciprocity between Italy and Switzerland, in compliance with Art. 16 of the [Preliminary Provisions to the Law: hereafter, “Preliminary Provisions”]”.

The Swiss company later brought a claim under the contract to the Como District Court.

In 2006, the seized court, of its own motion, ascertained that the requirement of reciprocity provided for in Art. 16 Preliminary Provisions had not been met and thus dismissed the claim.

In 2013, the losing party challenged the decision before the Milan Court of Appeals, which eventually quashed the appeal on the following grounds.

Decision

Before the  Italian Private International Law Act (hereafter “IPILA”) was passed, Italian domestic conflict of laws provisions were found in the Preliminary Provisions. Once the IPILA entered into force, these earlier provisions were amended, a part from Art. 16 Preliminary Provisions.

Art. 16 Preliminary Provisions provides for the requirement of reciprocity, whereby the national of a foreign State may enforce civil rights in front of Italian courts, as far as Italian nationals are allowed to enforce similar rights in front of the courts of that foreign State. The provision, which is headed “Treatment of the foreigner”, stipulates: “[1] The alien is entitled to the civil rights attributed to citizens on a condition of reciprocity and save for the provisions contained in special laws. [2] This provision also applies to foreign legal persons” (AN: translation provider by the Italiano Ministry of Foreign Affairs on its website, see link below)

As underlined by the appelate court – by quoting a judgment rendered by the Full Court of the Court of Cassation (No. 07/24814) – reciprocity does not affect jurisdiction, but rather the right whose enforcement is sought by the foreign national.

If the requirement is not met, in cases where a foreign national seeks to enforce a contractual right, the related contract will be declared null and his claim will be thus dismissed.

When disputes arise as to whether or not there is reciprocity, the national of the foreign State must prove that the right he seeks to enforce may be enforced by an Italian national in the courts of that foreign State.

He may prove this by any means, for instance, by submitting official documents (i.e. an affidavidit) by a public authority of the foreign State.

It is here that the role of the judge comes into play: Art. 14 IPILA allows him to – or better, requires him to – assess whether or not the requirement of reciprocity is met, by collecting, of its own motion, information as to the foreign law concerned.

Actually, Art. 14 IPILA reads: “[1] The judge ascertains of its own motion the foreign law. To such aim he may avail himself, a part from the instruments provided for in international conventions, of information provided by the Ministry of Justice; he may as well consult experts and specialized institutions. [2] Where the judge is unable to ascertain the foreign law, not even by the assistance given by the parties, he applies the law which is applicable by reason of other connecting factors existing in the same legal case. In the absence of that, Italian law applies”.

In the present case, the court noticed that, when the contract was made, under Swiss law, a foreign national could buy an immovable situated in Switzerland, to be used as a private dwelling, only if authorized by the competent Swiss canton. On the opposite, Swiss law allowed the purchase of immovables situated in Switzerland, regardless of any authorizations, where the foreign national purported to use such immovable for business purposes.

In other words, an Italian national could not buy a home in Switzerland, unless authorized by the local Swiss authority.

Actually, during the taking of evidence, the court ascertained that, in spite of the statement made in the contract, the Swiss company had not used the immovable situated in Italy as its legal seat and thus for business purposes.

Conclusion

Therefore, the court maintained that the requirement of reciprocity had not been met: Art. 16 Preliminary Provisions prevented the court from upholding a contractual claim made by a Swiss national under a contract that an Italian national, in similar circumstances, could have not enforced before a Swiss court. As a consequence, the sale contract whose enforcement was sought, was declared null and thus the appeal was quashed.

By the way, no relevance was given to the claim the Swiss company made that Swiss law was about to be amended, so as to allow foreign nationals to buy immovables situated in Switzerland regardless of any authorization.

Short comment

Surprisingly or not, Art. 16 Preliminary Provisions pursues a praiseworthy purpose: it is intended to protect Italian immigrants. In fact, the rule was introduced in the Italian law system in 1942 (Royal Decree of the 16th of March 1942, No. 262), soon after mass migration of the Italian people to the United States. By this codified form of retaliation, the Italian legislator pursued to encourage foreign States to recognize Italian immigrants same civil rights as those enjoyed by natives of the host State.

In domestic private international law rules of other European States, where considered, reciprocity comes into play when recognizing and enforcing judgments rendered by courts of Third States, but rather not when it comes to assessing whether or not a foreigner may enforce civil rights. Art. 16 Preliminary Provisions is thus an original model, one which has not been copied by any known legal system. Nonetheless, this instrument should be reconsidered and could inspire uniform private international law. For instance, under Art. 33 Regulation (EU) No. 1215/2012, in cases of parallel proceedings, the courts of a Member State may oust jurisdiction in favour of those of a Third State, when proceedings before the latter grant a “blurry” standard of trial fairness. This said, another possible solution – inspired by Art. 16 Preliminary Provisions – could be the one of allowing the courts of Member States to oust jurisdiction in favour of Third States only where proceedings comply with the standards of the former courts. This, by the way, could encourage Third States to adopt higher standards of trial fairness.

Futhermore, Art. 16 Preliminary Provisions does not apply when special law so provides. In particular, the main exceptions are provided for in Legislative Decree of the 25th of July 1998, No. 286, where, among the rest, it is provided that European Union nationals enjoy civil rights regardless of whether the requirement of reciprocity is met. In general terms, where nationals from Third States are involved, the assessment is made unless an international covenant exempts from doing so.

In conclusion, a last remark is that, though Art. 16 Preliminary Provisions has a limited scope of application, it could soon restore its former glory with Brexit…

See also

English notes on the requirement of reciprocity by the Italian Ministry of Foreign Affairs:

http://www.esteri.it/mae/en/ministero/servizi/stranieri/condizreciprocita/

Court of Cassation, Full Court, 19th September 2017, No. 21622 (Sociomantic Labs GmbH v. 6sicuro S.p.a)

Forum selection clauses in general terms and conditions published on a websites are valid and enfroceable under Article 23 Regulation (EC) No. 44/2001.

Facts:

6sicuro S.p.a. (hereafter, “6sicuro”), a company having its leagl seat in Italy, entered into a contract with Sociomantic Labs GmbH (hereafter, “Sociomantic Labs”), a German company, whereby the latter undertook to provide the former advertising services on the web.

The contract was made through the exchange of emails and the client signed the related confirmation order, where the link to the general terms and conditions published on the service provider’s website was mentioned.

On February 2016, 6sicuro sued Sociomantic Labs before the Milan Distric Court, claiming it had suffered damages from the alleged breach of contract by the service provider.

The defendant did not appear before the sezied court, but rather submitted a pleading to the Court of Cassation (a sc. ricorso per regolamento preventivo di giurisdizione), seeking for a declaration of lack of jurisdiction of Italian courts, on the grounds of the choice of Berlin courts made in the general terms and conditions that the claimant in main proceedings had agreed upon.

6sicuro challenged the plea by stating that the general terms and conditions where contrary to Directive 2000/31/EC, that the forum selection clause had to be considered as “non existent”, since it was nowhere to be found in the general terms and conditions that had actually been agreed upon when the contract was entered into, and that, in any case, the clause lacked of the formal requirements provided for in Art. 23 Regulation (EC) No. 44/2001 (as replaced by Art. 25 Regulation (EU) No. 1215/2012).

Decision:

The Court of Cassation held, in the first place, that the forum selection clause had to be construed as being exclusive for the purposes of Art. 23 Regulation (EC) No. 44/2001, which indeed applied in the present case since – according to the court – Regulation (EU) No. 1215/2012 applies only to contracts made after the 10th of January 2015, pursuant to Art. 81 thereof.

Secondly, by quoting the European Court of Justice (ECJ, judgment of the 21th of May 2015, C-322/13, Cars on the Web), the court held that the forum selection clause complied with the formal requirements mentioned in Art. 23(1) Regulation (EC) No. 44/2001. In particular, the jurisdiction agreement was entered into by an electronic means which provided a durable record of the same, considering that the general terms and conditions could have been printed and saved before entering the contract.

Nonetheless, 6sicuro averred that its counterparty had not provided sufficient evidence as to the fact that the general terms and conditions could have been printed and saved, nor that the latter were made available on the website when the contract was made, and neither that their text was actually the same as the one submitted in court.

These statements were deemed ungrounded, given that, on the one hand, when signing the confirmation order, 6sicuro stated it had read the general terms and conditions published in Sociomantic Labs’s webiste, and, on the other hand, the Italian company had sent a complaint letter where the same general terms and conditions were mentioned.

Furthermore, 6sicuro’s claims were not upheld by the court since the company had not maintained that the forum selection clause had been changed over time, but rather that the whole general terms and conditions had.

Thirdly, the court dismissed 6sicuro’s argument that the forum selection clause had to be specifically agreed upon, that Directive EC/2000/31 should have applied in the present case, that the clause had been poorly drafted and thus was misleading. As to the latter argument, in fact, 6sicuro underlined that the clause, which read “This contract is governed by German law. EU commerce law is excluded. Place of jurisdiction is Berlin”, had been poorly translated from German into English.

Conclusions:

In the light of all the above, the court concluded by stating: “Therefore, in the presence of a valid forum selection clause, having an exclusive nature, in favour of the judicial authority of a foreign country, the lack of jurisdiction of the Italian judge must be declared”.

Short comment:

This is the first time the Court of Cassation has considered the issue of forum selection clauses in general terms and conditions published on a website. Actually, a lower court, the Turin District Court had already faced the issue.

This said, the court applied Art. 23 Regulation (EC) No. 44/2001, when it should have applied  Art. 25 Regulation (EU) No. 1215/2012 instead, under Article 66(1) thereof. In fact, unlike Regulation (EC) No. 593/2008 (replacing the 1980 Rome Convention), to determine its scope ratione temporis, Regulation (EU) No. 1215/2012 does not take into account the date when the disputed contract was made, but rather the time when proceedings are commenced. In the present case, proceedings were commenced on the 18th of March 2016 and, according to the mentioned provision, Regulation (EU) No. 1215/2012 applies to claims filed from the 10th of January 2015 onward.

The court also confirmed that forum selection clauses need not to be specifically agreed upon (under Article 1341 Italian Civil Code).

Finally, though irrelevant for the purposes of the decision, indeed had the disputed forum (and law) selection clause been poorly translated. In fact, the German general terms and conditions of Sociomantic Labs (see https://www.sociomantic.com/tos/de/) provide for the exclusion of the CISG (“Es gilt das Recht der Bundesrepublik Deutschland unter Ausschluss des UN Kaufrechts”), that in the English version of the same general terms and conditions has been translated into the exclusion of a non existent “EU commerce law”.

See also:

Turin District Court, Company’s Division, court order of the 13th of May 2013, published in Rivista di diritto internazionale privato e processuale, No. 5/2015, pp. 567 and ff.