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CISG CASE PRESENTATION

Spain 15 June 2001 Appellate Court Baleares (Planisi S.A. v. Eurivinil S.p.A.) [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/010615s4.html]

Primary source(s) of information for case presentation: Case text

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Case identification

DATE OF DECISION: 20010615 (15 June 2001)

JURISDICTION: Spain

TRIBUNAL: Audiencia Provincial [Appellate Court] de Baleares

JUDGE(S): Sr. D. Santiago Oliver Barceló

CASE NUMBER/DOCKET NUMBER: 4/2001

CASE NAME: Planisi S.A. v. Eurivinil S.p.A.

CASE HISTORY: 1st instance Juzgado de Primera Instancia no. 10 de Palma 16 November 2000

SELLER'S COUNTRY: Italy (defendant)

BUYER'S COUNTRY: Spain (plaintiff)

GOODS INVOLVED: Embarcaciones [water craft]


Classification of issues present

APPLICATION OF CISG: Unclear. The sole specific mention of the CISG in this case is the statement that: "[Seller] ... claims that between the parties there has been a sale of water craft [embarcaciones], and that the [CISG] in the case of an international sale of goods, points jurisdiction towards the place of delivery of the goods and of the documents (arts. 31 and 34) or the place of payment (arts. 54 through 59)."

To be noted is the fact that art. 2(e) of the Spanish text of the CISG lists "embarcaciones" as excluded from the CISG and that, in this case, the embarcaciones appear to have been boats rather than ships.

APPLICABLE CISG PROVISIONS AND ISSUES

Key CISG provisions at issue: Article 2(e) [Also cited: Articles 31 ; 34 ; 54 ; 59 ]

Classification of issues using UNCITRAL classification code numbers:

2E [Exclusions from the Convention: ships, vessels]

Descriptors: Ships or vessels

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Editorial remarks

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Citations to case abstracts, texts, and commentaries

CITATIONS TO ABSTRACTS OF DECISION

(a) UNCITRAL abstract: Unavailable

(b) Other abstracts

Spanish: CISG-Spain and Latin America website <http://www.uc3m.es/cisg/respan17.htm>

CITATIONS TO TEXT OF DECISION

Original language (Spanish): CISG-Spain and Latin America website <http://www.uc3m.es/cisg/sespan17.htm>

Translation (English): Text presented below

CITATIONS TO COMMENTS ON DECISION

Unavailable

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Case text (English translation) [second draft]

Queen Mary Case Translation Programme

Audiencia Provincial de Baleares, 15 June 2001

Translation [*] by Alejandro Osuna [**]

[...]

The Fifth Chamber of the Regional Tribunal of Baleares, declares that the appeal filed by the Plaintiff against the judgment of 16 November 2000, issued by Court No. 10 of First Instance of Palma in a small claims proceeding, is founded.

Issued in Palma de Mallorca, on June fifteen, of the year two thousand and one. Decided by the Fifth Section of the Provincial Appeals Court, on appeal from a Small Claims Proceeding heard before Court 10 of First Instance of Palma, under file number 181/2000, Appeal Number 4/2001. Plaintiff and Appellant is Planisi, SA [hereinafter "Buyer], represented by Counsel Mrs. Nancy R.V.N. And defended by the learned Mr. Miguel Angel E.; the party being the Defendant-Appellee, Eurivinil, S.p.A. [hereinafter "Seller"], represented by Counsel Margarita E.C. and defended by the learned Mr. José S.M.

The opinion was presented by the Honorable Mr. Don Santiago Oliver Barceló.

FACTUAL BACKGROUND

FIRST. -- The Magistrate of the 10th Court of First Instance of Palma issued a judgment dated 16 November 2000, that reads: «Considering the issue of jurisdiction raised by ... [Seller]; we declare that the defense of lack of territorial jurisdiction raised and argued by ... [Buyer], to be founded and we decline our jurisdiction to the Courts and Tribunals of Italy. The losing party, the [Buyer], is hereby ordered to pay costs incurred in these proceedings».

SECOND. -- That against this judgment and in representation of the [Buyer], an appeal was lodged, which was admitted in both effects and was later amended, and the procedure was duly followed, and having heard the parties' arguments at a hearing that took place on June 4 of this year, with the assistance of the parties' learned counsel, they made oral arguments in support of their positions, quedando el recurso concluso para sentencia.

THIRD. -- In processing the appeal, all legal formalities were observed, except for the period to issue judgment, due to the backlog of cases pending judgment.

LEGAL BASIS FOR THE JUDGMENT

FIRST. -- [Seller], raised a defense based on lack of jurisdiction and it was determined that based on the accompanying documents it could not be concluded that the legal requirements for a distribution agreement were absent, as argued by the [Buyer] and based on art. 5.5 of the Brussels Convention of 27 September 1968 (RCL 1991\217, 1151 y LCEur 1972\178 and LCEur 1989, 1327), and also that the Spanish Tribunals, which were deemed inapplicable by the Judge of First Instance and therefore the general rule concerning cuyo precepto ha entendido inaplicable el Juzgado «a quo» por lo que debe estarse al fuero general que lo constituye el domicilio de la entidad demandada, cuyo domicilio social radica en Italia.

The [Buyer] insists before this Appellate Tribunal that there is a commercial distribution agreement between the parties, thus making article 5.5 of said agreement applicable, which is denied by the [Seller] based on art. 3 of the Brussels Convention; [Seller] denies that there is an exclusive agreement of any kind.

SECOND. -- Those being the issues, it is adequate to state:

     -   Firstly, that art. 5 of the Brussels Convention, by which «persons domiciled in a State may be sued in another Contracting State ... 1. -- In contract matters, before the court of the place where the obligation should have been performed; and 5. -- If the dispute concerns the conduct of business of branches, agencies or any other place of business, before the court where these are located»;
 
     -   Secondly, art. 3 of said Convention provides that «persons domiciled in a Contracting State may only be sued before the Tribunals of another Contracting State by virtue of the special rules on jurisdiction provided for under Sections 2 and 6 of this Title», which are the special jurisdictions provided for under arts. 5 and 6, in insurance claims (arts. 13 and 15), exclusive jurisdiction, without regard to domicile (art. 16) and the choice of jurisdiction clauses (arts. 17 and 18 of the Convention).

Therefore, the [Buyer] defends the jurisdiction of the Spanish Courts, in the instant case, when claiming damages and lost profits caused by [Seller], and based on art. 5.5. of the Brussels Convention, on what he understands to be a distribution agreement for Spain between the parties, and specifically alleges breach by [Seller] or its impossibility to perform, since the [Buyer] had sent [Seller]´s products and its personnel to the Nautical Hall. The [Seller] defends the jurisdiction of Italian Courts, claiming that there had only been a commercial relationship between both entities, and not as an exclusive distributorship agreement in favor of [Buyer], absent essential sales conditions such as price, concessions, and a minimum sales volume.

THIRD. -- This Tribunal understands that it must first proceed to analyze the nature of the commercial relationship, uncontested by the parties, to later determine if the requirements to apply art. 5.5 of the Brussels Convention, previously discussed, are present.

The submitted documents allow us to conclude that the parties were engaged in preliminary discussions, and the fax would construe a pre-contractual arrangement for a distribution agreement for Spain, the validity of which, scope, interpretation and consequences would comprise the substance of the dispute; it would be improper for us to talk about an exclusive arrangement of any kind, which must also be interpreted restrictively, and, without of duration cause, even if it includes concepts and basic content typical of such contractual arrangements. We should also not apply by analogy the domicile of the [Buyer] as an agent, since this is not an agency agreement; to the contrary, as a representative in Spain it would make the domicile of principal and agent grantor coincide in this country.

In this specific context, it is evident that paragraph 5 of art. 5 of the Brussels Convention does not apply. Absent a branch or agency there is no special grant of jurisdiction.

In Spain, there is no secondary place of business dependent of an Italian parent company, nor succession in the direction or control of the parent company, and even if there was such a direction or control this would not apply to the relationship with an exclusive sales agent who performs his activity at its own risk and venture, that are legally and economically independent (SSTJCE of 6 October 1976, 22 November 1978, 18 March 1981, 9 December 1987 [TJCE 1988\53]). In this case, it is not required that in the future they act under the same corporate name, nor under the same address or domicile, nor would contracts be made on account and on behalf of the other entity.

The application of the place of business for «claims regarding the exploitation», comprises the rights and obligations concerning the operation of the agency, branch or place of business, the conduct of business on behalf of the parent company and that are to be discharged in the State where the base of operations is located, or for obligations assumed in Spain on behalf of the parent company, which does not occur in this case, more so since the parent company is not the [Buyer] in this case attempting to benefit from the forum of the place of business (STJCE of 6 April 1995 (TJCE 1995\43], among others).

FOURTH. -- Notwithstanding the previous considerations, this Tribunal understands that the Spanish Tribunals have jurisdiction, particularly the Courts of First Instance of this Capitol, to hear and decide the claim for damages and loss of profits derived from the commercial relationships, in this case, based on what is provided for under paragraph 1 art. 5 of the Brussels Convention:

  1. It is in conformity with that which is provided for under art. 22, in constitutional matters, the Law Organizing the Judicial Power (RCL 1985\1578, 2635; ApNDL 8375);

  2. For the purposes of jurisdiction, it is irrelevant if there was or was not exclusivity in the concession or distribution agreement;

  3. There is objective data, e.g., the typical obligations described in the documents, that rationally allows us to deduce the effects of the commercial relationship between the parties without prejudicing the solution of the merits of the case;

  4. The claims for damages are linked to the place of performance of the obligation whose unjustified breach is claimed;

  5. For purposes of art. 5.1 of the Brussels Convention, the place of jurisdiction is that where the grantee exercises his granted authority as the place of performance that serves as a basis for the claim;

  6. The Rome Convention of 19 June 1980 (RCL 1993\2205, 2400), determines that the place of performance of the obligations is that of the place of performance of the obligations which govern the substance of the case in its subjective scope, and in lieu of an express submission of the parties, in Spanish Law that is the domicile of the debtor, recognized by the [Seller] when it claims that between the parties there has been a sale of water craft [embarcaciones], and that the Vienna Convention of 11 April 1980 (RCL 1991\229 y RCL 1996, 2896) in the case of an international sale of goods, points jurisdiction towards the place of delivery of the goods and of the documents (arts. 31 and 34) or the place of payment (arts. 54 through 59);

  7. In any case, the place of performance is that where the concession agreement would be performed.

The arguments previously described are applicable to preliminary dealings and to the pre contractual arrangement (en este caso acompañado por fax folios 147 y ss) as the basis for the development of future business, in which the claim for pre-contractual liability for lack of objective good faith or for the unjustified breaking off of negotiations, for which only one party is responsible, as provided for under art. 1152 of the Civil Code that may substitute an indemnity for damages. The interpretation of the documents on file, at pages 147 et seq. and 180, and their extent and content, are the basis of this matter, thought it is convenient to clarify, that contrary to what was determined by the Trial Level Judge, who refers to a distribution network in Spain and y a medio plazo, and to the existence of Spanish resellers, to the minimum purchase of boats per season, to the price of stands and publicity, to units for showcasing and to be paid for by [Buyer], to documents and commercial methods, as has occurred, al igual que los portes, whose distribution work has been hindered by a third entity, after expenses have been incurred, to be determined when the merits are decided in this case (see letter from the [Seller] offering tutela a la actora frente a posibles acciones o requerimientos por parte de terceros), effected in Spain, the country in which the commercialization ceased after the first boats had been delivered, causing effects in this City even the price was still owed. Por otra parte, the performance of the future obligations of the contract would be performed in Spanish territory, which would render ineffective the clauses that cause submission to Italian laws and jurisdiction, was not signed by the parties, hence the shifting of the majority of the points of connection in the verbal pre-contractual arrangement of a still abstract character but that has an effect in relation to the real object of the future contract and with the claims mentioned herein; all of which along with the expressed considerations, are more that enough reasons to apply art. 5.1 of the Brussels Convention, procediendo la estimación del recurso (en el mismo sentido, the SSTS of 10 November 1993 [RJ 1993\8980], 20 July 1992 [RJ 1992\6440], 10 July 1990 [RCL 1990\5792] sobre acción por daños y perjuicios, 1 March 1991 and SSTJCE of 28 September 1999 [TJCE 1999\13] and 20 February 1992 por daños, entre otras).

FIFTH. -- The complexity of the matter, the interpretation of the articles of the Brussels Convention, the specific circumstances that they describe and the possibility that they apply to pre-contractual arrangements, constitute exceptional circumstances that make the imposition of legal costs, incurred in both instances, inadequate, thus excluding the principle of con exclusión en este caso del principio del vencimiento.

RULING

Based on what has been discussed, the Fifth Section of the Audiencia Provincial de Palma de Mallorca has decided that:

     -   The Appeal filed by ... [Buyer], against the judgment dated 16 November 2000, issued by the Court of First Instance Number Ten of this Capitol in the Interlocutory Proceeding on Jurisdiction by Declination of Jurisdiction No. 181/2000 that de que dimana el presente Rollo de Sala, we declare that the Court of First Instance that is referred to has jurisdiction to resolve the Small Claims Proceeding concerning damages, filed by the [Buyer], against the [Seller], domiciled en Italy ...
     -   There is no express awarding of costs on the parties caused in these interlocutory proceedings in both instances.

This being our judgment, we so declare, order and sign.

PUBLICATION. -- Issued and pronounced by the Magistrates who sign it and was read by the Drafting Magistrate on the same date, of which I hereby attest.


FOOTNOTES

* All translations should be verified by cross-checking against the original text. For purposes of this translation, Plaintiff-Appellant of Spain is referred to as [Buyer], and Defendant-Appellee of Italy is referred to as [Seller].

** Alejandro Osuna [enter bio data]

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Pace Law School Institute of International Commercial Law - Last updated July 19, 2004
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