DRAFT OHADAC MODEL LAW RELATING TO PRIVATE INTERNATIONAL LAW

Article 9

Sole jurisdiction

The Caribbean courts shall have sole jurisdiction for disputes whose subject matter is:

  1. rights in rem in immovable property and tenancies of immovable property when the property is located in Caribbean territory;
  2. the formation, validity, nullity and dissolution of companies or entities whose domicile is located in Caribbean territory, as well as the validity of any agreements and decisions of their organs affecting their existence erga omnes and the rules governing their operation;
  3. the formation, validity, nullity and extinction, as well as the existence in relation to third parties, of trusts domiciled in Caribbean territory;
  4. the validity or nullity of entries in a Caribbean register;
  5. the registration or validity of patents and other similar rights giving rise to a deposit or registration, when the deposit or registration was filed or made in the Caribbean;
  6. the recognition and enforcement in Caribbean territory of judicial decisions and arbitral awards handed down abroad;
  7. provisional and conservatory measures which must be enforced in the Caribbean;
  8. the determination of Caribbean nationality.

137. Although the cases in which the Caribbean courts have sole jurisdiction are the first to which Chapter 2 of Part II is devoted, they must not be viewed as establishing a mechanical jurisdiction to which the following provisions would provide some exceptions253. The model law does not follow the outline of the 1968 Brussels Convention or of the Brussels I Regulation, which give preference to the mechanism of general jurisdiction based on the domicile of the defendant, thus suggesting that the other grounds of jurisdiction are derogatory and subject to strict interpretation. It sets them forth in the order chosen by distinguished commentators of those European instruments254. That order expresses, no doubt better than a sort of hierarchy of grounds of jurisdiction, an operating priority of sole jurisdiction over voluntary extensions of the scope of jurisdiction and the provisions based on domicile: whoever wishes to refer a dispute to the Caribbean courts must seek to determine whether the latter are designated under some grounds of sole jurisdiction; if not, he shall then seek to determine whether they are designated by a choice of jurisdiction clause; if not, subject to making sure that no derogatory clause can move the case abroad, he will verify that the defendant is domiciled in the Caribbean, or that on account of the nature of the disputed interests the lawsuit can usefully be referred to the Caribbean courts. This operating chronology, which goes down the ladder of eliminatory force, does not prejudge the status of the various forms of jurisdiction: sole, voluntary, general or specific.

138. Listed imitatively in Article 9, the cases of sole jurisdiction immediately lead to the Caribbean courts when the connecting element found in them is materialised within the Caribbean legal order. Five of them are included in the catalogues found in Article 22. 1 of the LOPJ (Spain) and Article 22 of the Brussels I Regulations; they are provided in the case of buildings, companies and entities, registrations on public registers, intellectual rights and enforcement of decisions. The model law completes that list by adding jurisdiction in matters of trusts, provisional measures and Caribbean nationality. That jurisdiction is exclusive in the sense that, from the Caribbean point of view, the litigants may not submit the dispute to courts other than the Caribbean courts. No competition with foreign courts is allowed; the plaintiff has no choice; he must refer his claim to the Caribbean courts. This necessary devolution presents several characteristics.

139. In the first place, sole jurisdiction is global jurisdiction (or international, or again general jurisdiction, according to Bartin's terminology) in the sense that the designation resulting from the dispute's being located within the Caribbean legal order concerns all of the judicial organs; this is the solution adopted both by the law of the European Union (Brussels I Regulation, Art. 22) and by Spanish law (LOPJ, Art. 22, 1). It is doubtless justified by the idea of a significant implication, in the disputes thus reserved, of the State's own interest at the international level, much more than by a specific relationship connecting the case to a definite court. Consequently, it is up to the Caribbean State and legal order, once their general jurisdiction has been established, to identify within the national judicial system, through their internal jurisdictional rules, the court to which the case shall be referred255.

Second, exclusive jurisdiction is mandatory jurisdiction. It follows that the clauses under which the parties may have agreed to entrust the dispute to this or that court of a foreign State are inoperative and cannot weaken Caribbean jurisdiction. This unavailability of Caribbean jurisdiction is the natural corollary of its exclusive character: by authorising referral to the Caribbean courts only, it does away with competition between courts and does not leave any choice up to the litigants.

Third, exclusive jurisdiction has two effects: an obligation of referral to the Caribbean courts and a prohibition from going before foreign courts. The positive effect, i.e. the obligation, affects direct jurisdiction and founds the legality of the proceedings initiated before the Caribbean courts; the negative effect affects indirect jurisdiction and decrees that any suit prosecuted before a foreign court is illegal, so that the resulting decision cannot be recognised and enforced in the Caribbean (see Art. 74, iii).

140. Fourth, exclusive jurisdiction produces a specific effect in the relations between the States that have adopted the model law. This is what some authors have called the reflex effect256 or mirror effect. It will lead the Caribbean court to which the case has been referred to disclaim jurisdiction when the grounds of jurisdiction listed in Article 9 are materialised within the legal order of a foreign State. By the effect of Article 9, that foreign State claims a monopoly over the dispute, as the Caribbean would have done on the same basis if the grounds of exclusive jurisdiction had been materialised in its own territory. The special value of this reflex effect becomes clear when the circumstances of the case do not allow the Caribbean judge to rely on Article 9, but would offer him the possibility of basing his jurisdiction on another rule, for instance when the defendant's domicile is located in the Caribbean (Art. 11); in that case, if the suit is brought and prosecuted in the Caribbean, there is no guarantee that the claim will not also be submitted to the courts of the foreign State, so that the risk of conflicting proceedings and therefore of conflicting decisions is in no way prevented. Now, while those risks of conflict are resolved from the viewpoint of Caribbean law in Article 74, which, at the level of recognition and enforcement, leads to a preference for the Caribbean suit or judgment and to the censure of the foreign suit or judgment (Art. 74, iv or v), this can be no more than a pseudo-solution for the parties. Indeed, it is obvious that in practice, since the difference is located abroad, the Caribbean decision will not prevail there and will be unable to give rise to compulsory enforcement; on the contrary, the foreign judgment, while disqualified in the Caribbean, will be readily enforced by the authorities of the State in whose name it was handed down. By admitting the reflex effect, which guarantees a single lawsuit thanks to the Caribbean court's disclaimer of jurisdiction, Article 9 submits to the requirements of procedural economy. Moreover, it is in line with the method of “soft” unification embodied by the model law by ensuring a common solution for the States adopting it. Conversely, it may appear more daring to provide such a jurisdictional division of labour with States that have not adopted the model law and that, rather than setting out in the direction of harmonisation, prefer to retain their own system of international jurisdiction, whose tenor may be different, whether the differences concern connection or qualification of the claims. This may result in leaving jurisdiction to the courts of some third-party State whose claims to it may be less relevant than those of the Caribbean courts.

Thus, the reflex effect simply obliges the Caribbean court to disclaim jurisdiction, if necessary of its own motion, in one case only, that is, when it is sure that the dispute will be settled abroad by courts whose jurisdiction cannot be disputed (Art. 17, §4 )257; this is guaranteed, precisely, by the adoption of the model law by the State in which the criterion provided in Article 9 is materialised. The reflex effect gives rise to a judicial cooperation network that may develop into a true OHADAC judicial area.

141. Article 9 lists eight cases of exclusive jurisdiction. Only one of them is clearly outside the territorial dimension; it is the last on the list (Art. 9, viii), which establishes the jurisdiction of the Caribbean courts concerning disputes relating to the determination of Caribbean nationality. It is easy to understand why, in such a matter, the claim of the Caribbean courts is not based on a territorial connection, on the one hand, and on the other hand is exclusive. An individual's nationality may doubtless be based on jus soli, but the relationship which it establishes between the individual and the State is a personal bond which endures even beyond borders and retains its vitality and authority wherever the individual is. That bond, which forms the subject matter of the suit, no doubt concerns the private individual who is its subject; but it also concerns, and very closely, the State which, as a sovereign entity, has a monopoly when it comes to determining who are its nationals, that is, its personal component. The necessary impact on that component of judgments ruling, on a principal basis, on the granting, acquisition or loss of nationality justifies exclusive jurisdiction. The State's interest, evidenced by the enforceability of its own law, is too closely involved for it to leave such a matter to a foreign court. That fact is so clear that we may conjecture that whoever, on a principal basis, claims a certain nationality or disputes his having it will submit the matter directly to the courts of the State concerned. As a result, there is hardly any chance that the question of the reflex effect of exclusive jurisdiction will come up before the Caribbean courts.

142. But a foreign court may consider that it has jurisdiction to rule on a matter of Caribbean nationality. This may happen, for instance, because its own rules of international judicial law allow it to rule on an incidental basis on a matter of nationality which must be resolved in order to settle the principal claim submitted to it in its capacity as the court of the domicile of the defendant. This possibility concerns the Caribbean in connection with the recognition of the decision thus secured abroad: under Article 74, iii), is the exclusive jurisdiction provided in Article 9 an obstacle in the way of the legality and therefore of the effectiveness of that foreign decision? Although the wording of Article 9 does not draw any distinction between a principal claim and a collateral issue, it seems that here the exclusive character of international jurisdiction and the monopoly which it grants the Caribbean courts must be restricted to cases in which Caribbean nationality is the principal subject matter of the suit. A refusal to recognise the foreign decision would lead to a denial of justice allowing the suit to be reiterated before the Caribbean court (Art. 15, ii), whereas the solution to the issue of Caribbean nationality dealt with on an incidental basis in the foreign suit receives its authority, at most, in view of the solution given to the principal issue; the costs and delays required by the duplication of the proceedings would be so disproportionate as to interfere with the right to effective judicial protection, and such an interference could not be justified by the minor disturbance which is feared, consisting in its recognition. Reciprocally, a restriction to the sole cases in which the issue of Caribbean nationality forms the principal subject matter of the suit must be admitted when interpreting and enforcing Article 17 §4: the Caribbean courts shall disclaim jurisdiction of their own motion when a question relating to a foreign nationality, for which the courts of another State having adopted the model law have exclusive jurisdiction under Article 9, is referred to them on a principal basis; on the contrary, if an issue of foreign nationality is raised on an collateral basis in connection with a principal issue for which they have jurisdiction, the Caribbean courts need not decline.

This point of interpretation, which relates to the scope of the reflex effect, also concerns the other grounds of exclusive jurisdiction listed in Article 9, to which, for the same reasons, the same solution applies.

143. These other grounds of exclusive jurisdiction are all territorial in nature. This territoriality results from considerations of sound administration of justice and procedural economy whose intensity varies from case to case, but on a relatively narrow scale. The interest of the State also comes into play for each of them. That interest is involved by claims aiming at securing or denying the recognition and performance of foreign decisions and arbitral awards in the Caribbean (Art. 9, vi), since we are dealing with the integration into the Caribbean legal order of decisions taken outside its own judicial and coercive system in the name of a foreign sovereign or through the enforcement of a private agreement; no authority other than that of the Caribbean may, without compromising Caribbean sovereignty and the Caribbean organisation of justice, rule usefully on such matters. In this area, the operating scope of that sovereignty and organisation coincide with the national territory. It must, moreover, be observed that exclusive jurisdiction here encompasses, beyond the procedures for the reception of decisions, the disputes relating to enforcement measures; indeed, the latter materialise the State's monopoly on the use of legitimate constraint, and that monopoly is limited to the national territory. That last justification, together with the previous one, also holds as regards conservatory measures to be enforced in Caribbean territory (Art. 9, vii).

144. Again, sovereignty is involved, though no doubt less closely, when dealing with the public registers instituted and managed in order to consolidate various kinds of rights of private individuals and facilitate their exercise by providing information to third parties (civil status register, land registry, trade register, companies register...). These organisms, established in the national territory and operating in accordance with formalistic procedures, produce information which is both coded and has geographic consequences limited to the territory258. The publicity of legal situations thus forms the subject matter of public services which the State organises in the interest of private individuals, not only the holders of rights, but also the entire community. This mission of public administration of private interests cannot be subject to the control, be it merely judicial, of a foreign State without undermining the sovereignty of the Caribbean or creating risks of disruption. Thus, the model law adopts the solutions sanctioned by the Brussels I system (Art. 22, par. 1, n°3 and 4) both for public registers in general, as is acknowledged by Article 9, v), and for the registration and validity of patents and other rights subject to filing or registration, as referred to in Article 9, vi)259.

145. Though perhaps less visibly, the hand of the State nevertheless weighs on two categories of institutions able to act autonomously in civil and commercial life. These are, on the one hand, companies and entities (Art. 9, ii) and, on the other hand, trusts (Art. 9, iii). By opting for identical solutions for those two categories, the model law departs from the Brussels I system and from the LOPJ, which, by not providing any exclusive jurisdiction for trusts and even neglecting their autonomy, submit their internal disputes to the system of jurisdiction based on domicile, unless ruled out by a voluntary extension of the scope of jurisdiction. But, as observed above under Article 5, §1, c), a certain number of legal systems within the OHADAC area are familiar with that institution and intend to foster its development; therefore, it appeared opportune to provide lawsuits challenging its existence or status with appropriate rules in the matter of jurisdiction. Since, like companies or other legal persons, trusts (as opposed to natural persons) are artificial entities, their corporate reality, which allows them to manage interests to which they are independently ordained, is the product of the legal order under the aegis of which they exist; it is thus appropriate to make domicile, as defined by Article 5, §1, c), a ground of jurisdiction, since that is where that reality is manifested and the decisions concerning it will make their effect felt - an effect that can be none other than the one provided and sanctioned by the State under whose protection they are260.

146. Finally, the State in which real property is located is granted exclusive jurisdiction for lawsuits having as their principal subject matter the rights in rem relating to that property. This solution, here approached last, is the first to be sanctioned by Article 9 (i). That order reminds us that, from a historical viewpoint, it is at the origin of the Euro-Continental tradition of private international law. It has been retained and has come into general use because it remains in consonance with the contemporary representation of the State-based legal order. Rights in rem relating to immovable property are perceived as elements of the status of property which are inseparable from an essential component of the State, that is, its territory. Moreover, as a bundle of prerogatives allowing uses to be separated from the thing itself, rights in rem participate in their distribution between the members of the social body; as a basis of social exchange, they require local uniformity, so that those exercising them and those upon whom they are binding will be, as regards the same property, entitled to the same freedoms or subject to the same limitations, all strictly coordinated and adjusted together, failing which anarchy would develop. This requires the State to ensure the policing of land and to guarantee the security of transactions, which does not brook any interference on the part of foreign lawmakers. The involvement of the State is here reinforced still more by its sovereign missions consisting in the promotion or protection of an economic system and of management of the environment. The proper performance of those various tasks demands that the State on the territory of which the real property is located have a monopoly of the legal treatment of the rights relating to it; the same is not true of movable property (see below, Art. 58 et seq.). Besides, reasons less related to the public interest and applying with more or less force to the other cases referred to in Article 9 militate in favour of such exclusive jurisdiction. In the event of a dispute, the State where the property is located is the one on whose territory it may be necessary to carry out investigation measures, as well as the one whose law will normally be applicable in that matter of rights in rem; therefore, the courts that are “ready to do the job” and familiar with the rules governing the case correspond to the twofold dimension, both geographic and intellectual, of the “principle of proximity” which thus localises the lawsuit on that territory and aims at guaranteeing the sound administration of justice through correct knowledge of the facts and correct application of the law. Together with the requirement of procedural economy, which recommends that the action be initiated before the courts of the place where the prerogatives are exercised, and where, therefore, the conflict of interests arises and the decision will necessarily be materialised, that “principle” imposes a solution on the parties, regardless of their personal procedural positions (neither actor sequitur forum rei nor forum actoris). The jurisdiction thus established is so well-founded in reason that it does not, in fact, leave them any useful choice. But backed as it is both by the interest of the State and by that of private individuals, such exclusive jurisdiction might develop a vis attractiva that would risk extending its scope improperly beyond rights in rem alone.

147. That risk did not escape the authors of the model law, who, following the example of the authors of the 1968 Brussels Convention or of Article 22, 1 of the LOPJ, supplemented Article 9, i) by adding disputes concerning building leases to those relating to rights in rem in immovable property. That addition is justified inasmuch as the reasons founding exclusive jurisdiction apply just as intensely to the former as to the latter. But at the same time, since they are limited to disputes “relating to the existence or interpretation of leases or to the repair of damage caused by the tenant, to the vacation of the premises”261, that is, relating to the occupation and use of rented property, it must be admitted that they do not extend to other lawsuits between lessors and tenants in which the obligational or contractual aspect is predominant. Precisely, the extension takes place only as regards the relationship between the tenant and the thing rented. That relationship is often governed by specific legislation corresponding to public policies (economic or social); on account of that legislation's complexity and mandatory character, it is preferable to reserve its application to the courts of the countries where it is in force.

Contrary to the successive versions of the Brussels Convention and to the Brussels I Regulations, the model law has not removed holiday rentals or short-term leases from the exclusive jurisdiction provided in Article 9. As a result, the Caribbean courts will necessarily have sole jurisdiction for any disputes arising in connection with those modes of occupation and use, and will thus be able to apply to them whatever provisions their legislation considers to be mandatory.


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