Agreement according with the parties’ established practices

Article 23(1 )(b) validates an agreement on jurisdiction in the absence of writing recording the assent of the party to be bound if there is sufficient evidence of a practice having been established between the parties and of the agreement conforming to it.^[1] The reference to practices which the parties have established between themselves has in mind, no doubt, a situation in which the history of past dealings would suggest that it would be bad faith on the part of a party who sought to rely on the lack of writing to challenge the formal validity of the agreement, or to argue that there was no notice of the proposed agreement on jurisdiction. This legislative version of formal validity was in fact ushered in by the decision in Iveco Fiat SpA v Van Hool NV,⁵¹ where a written agreement, which had contained a choice of court clause, had lapsed without the parties appearing to have noticed. It was held that the jurisdiction agreement could in principle continue to operate, though the precise reasoning in the case, that the clause did comply with the need for writing, would now be redundant. The proposition that the party to be bound had accepted the jurisdiction of the named court, and had done so in writing, remained true despite the fact that the parties’ contractual relationship had become less formal. The wording of Article 23(1 )(b) may be more easily understood as a pointer to a principle of reasonable notice, rather than as requiring a strict analysis of the meaning of ‘practices’ and ‘established’.

Agreement according with the practices of international trade

The major relaxation of the original requirement of writing was made to accommodate those engaged in international trade, and who may be expected to assume that a jurisdiction agreement in the usual form will apply to them and to each of them. In its present version, Article 23(1 )(c) provides that it is sufficient if, in international trade or commerce, the agreement is ‘in a form which accords with a usage of which the parties are or ought to have been aware and which in international 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’. This formulation is relatively new, the two leading authorities on this issue having been decided on the basis of an earlier, less

B JURISDICTION ACCORDING TO LUGANO/BRUSSELS prescriptive, form of words. With that qualification, though, the guidance which they give is still reliable.

In MSG v Les Gravieres Rhenanes Sari,^[2] and in Trasporti Castelletti Spedizioni Internazionali SpA v Hugo Trumpy SpA,' the European Court stated that, where it was established that there are commercial practices in a particular branch of international trade or commerce in which jurisdiction agreements are made in a particular way, and that the parties were or ought to have been aware of this habit or practice of making jurisdiction agreements, their agreement to the jurisdiction of the court will be presumed to have been established. Indeed, the current version of the Article may even dispense with the presumption: the parties are bound if it can be said that the practice exists and is generally known in the trade, and that the parties should have been aware of it. International trade means just that, so in MSG itself, river transport on the Rhine between France and Germany qualified.

As to how widely the practice must exist, whether it must be shown to exist in particular Lugano States, or whether there must be publicity, what is required is a practice which is generally observed in the trade: no more prescriptive limitations apply. So if it is customary in the particular trade to use documents with a printed choice of court in them, which are otherwise unsigned and often unread, or if it is customary to send a letter of confirmation to which a response is not expected, assent (and in this sense, agreement) to the jurisdiction of the court will be deemed to be present as long as the parties should have been aware of it. The parties in such a case are far from the predicament of the hapless private buyer who is not prompted to read the tiny print on the back of a delivery note.

The most recent statement of the law is made in reference to the market in financial bonds, in which the European Court reiterated the duty on the national court to analyse the way business in the sector is carried on. The judgment does not take the matter any further forward.

• [1] For illustration, see OT Africa Line Ltd v Hijazy [2001] 1 Lloyd’s Rep 76 (liner services); SSQ Europe SA v Johann & Backes OHG [2002] 1 Lloyd’s Rep 465 (sales of slate). See also the approach of a German court in Jurisdiction in the Case of a Sale Involving the Carriage of Goods (5U 99/07) [2010] ILPr 529. 2 See Calyon v Wvtwornia Sprzetu Komunikacynego PZL Swidnik SA [2009] EWHC 1914 (Comm), [2009] 2 All ER (Comm) 603, esp. at [83]. 3 313/85, [1986] ECR 3337. 4 This may be the lesson to be drawn from Calyon v Wvtwornia Sprzetu Komunikacynego PZL Swidnik SA [2009] EWHC 1914 (Comm), [2009] 2 All ER (Comm) 603.
• [2] C-106/95, [1997] ECR 1-911. 2 C-159/97, [1999] ECR 1-1597. 3 Public Institution for Social Security v Al-Rajaan [2020] EWHC 2979 (Comm). 4 It includes associated insurance: Standard Steamship Owners' Protection & Indemnity Assurance (Bermuda) Ltd v. GIE Vision Bai! [2004] EWHC 2919 (Comm), [2005] 1 All ER 618. 5 Though this will sometimes be catered for under the rules for certain consumer contracts, the restricted range of contracts to which Section 4 of Title II applies will limit the protection given. 6 C-366/13 Profit Investment SIM SpA (in liq) v Ossi, EU:C: 2016:282, [2016] 1 WLR 3832. 7 C-366/13 Profit Investment SIM SpA (in liq) v Ossi, EU:C: 2016:282, [2016] 1 WLR 3832; Public Institution for Social Security v Al-Rajaan [2020] EWHC 2979 (Comm).