1. By an order dated 8 April 1983, which was received at the Court on 28 April 1983, the Hof van Cassatie (Court of Cassation), Belgium, submitted, in accordance with the Protocol of 3 June 1971 on the interpretation by the Court of Justice of the Convention of 27 September 1968 on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters (hereinafter referred to as “the Convention”), a question for a preliminary ruling on the interpretation of Article 17 of that Convention.
2. The question was raised in proceedings brought by the Belgian limited company “NV Goeminne Hout” against the German ship owner “partenreederei Ms Tilly Russ” and Mr Ernest Russ, both of Hamburg, concerning the validity of a jurisdiction clause contained in bills of lading Nos ct 108 and ct 118 dated 16 August 1976. It appears from the documents before the Court that those bills of lading were drawn up for the carrier by Tolmar International Inc., Cleveland, as agent for Europe Canada Lakes Line, Ernest Russ - North America, Inc., Chicago, to the order of the shipper, American Lumber International Inc., Union City, Pennsylvania, Goeminne Hout being indicated as “notify party” and Tilly Russ as “exporting carrier”.
3. When the cargo was delivered in Antwerp on 7 September 1976 the packaging of two lots was found to be damaged and about 10 planks were missing. Goeminne hout therefore claimed USD 304 in damages before the Rechtbank van Koophandel (Commercial Court), Antwerp.
4. Tilly Russ objected to the jurisdiction of the Antwerp court, relying on a jurisdiction clause appearing on the reverse of each of the bills of lading which stated as follows: “any dispute arising under this bill of lading shall be decided by the Hamburg courts.”
5. Nevertheless, by judgment of 31 October 1978, the Antwerp court held that it had jurisdiction and gave judgment in favour of Goeminne Hout; that judgment was confirmed by the Hof van Beroep (Court of Appeal), Antwerp, by judgment of 7 October 1981 and, on 1 March 1982, Tilly Russ appealed to the Hof van Cassatie.
6. The Hof van Cassatie submitted the following question for a preliminary ruling:
“Can the bill of lading issued by the carrier to the shipper be considered, having regard to the relevant generally accepted practices, to be an “agreement in writing” or an “agreement evidenced by writing” between the parties within the meaning of Article 17 of the Convention of 27 September 1968 on Jurisdiction and the Enforcement of Judgment in Civil and Commercial Matters and, if so, does that also apply in relation to a third party holding the bill of lading?”
7. That question must be construed as asking whether the jurisdiction clause contained in the bills of lading satisfies the conditions laid down in Article 17 of the Convention as regards, first, the relationship between the shipper and the carrier and, secondly, the relationship between the carrier and a third party holding the bill.
The first part of the question
8. According to Goeminne Hout and the Commisison of the European Communities, Article 17 of the Convention should be interpreted as meaning that where a jurisdiction clause is not expressly accepted by the shipper and the carrier it is not valid within the meaning of that provision.
9. The Commission adds, however, that even if it was not signed by the shipper such a clause may nevertheless be valid under Article 17 of the Convention, provided that there is a continuing trading relationship between the parties.
10. The Italian government considers that a bill of lading is a document proving the existence of the contract of carriage and that the jurisdiction clause therefore constitutes an oral agreement evidenced in writing. If it is signed by the party against whom it is invoked and forms part of the general conditions of the contract, then it may be in conformity with Article 17 of the Convention. However, according to the Italian government, it is for the national court to ascertain whether there is a signature in the sense indicated above and in what circumstances the jurisdiction clause was incorporated in the bill of lading.
11. At the hearing, the United Kingdom emphasized the importance of the issue raised and suggested that the question submitted by the national court should be reformulated as follows: was the jurisdiction clause incorporated in the bill of lading in a manner enabling it to be shown that there was a genuine agreement between the parties, account being taken of the principle of good faith? A reply to that question is possible, according to the United Kingdom, only if the precise facts of the case are known; however, since in this instance they have not been established no general reply should be given to the first question, on the ground that there are several possibilities, and the national court should be left to determine the precise nature of the bill of lading.
12. The first paragraph of Article 17 of the Convention, as now in force, states: “If the parties, one or more of whom is domiciled in a Contracting State, have, by agreement in writing or by an oral agreement evidenced in writing, agreed that a court or the courts of a Contracting State are to have jurisdiction to settle any disputes which have arisen or which may arise in connection with a particular legal relationship, that court or those courts shall have exclusive jurisdiction.”
13. It may be observed that for Article 17 of the Convention to apply at least one of the parties must be domiciled in a Contracting State, that being a matter for the national court to determine.
14. As the Court held in its judgments of 14 December 1976 (Case 24/76, Salotti v Ruwa, unalex EU-6, and Case 25/76, Segoura v Bonakdarian, unalex EU-7) and of 6 May 1980 (Case 784/79, Porta-Leasing v Prestige International, unalex EU-123), the requirements set out in Article 17 governing the validity of jurisdiction clauses must be strictly construed since the purpose of Article 17 is to ensure that the parties have actually consented to such a clause, which derogates from the ordinary jurisdiction rules laid down in Articles 2, 5 and 6 of the Convention, and that their consent is clearly and precisely demonstrated.
15. In order to decide whether the conditions laid down in Article 17 are satisfied, it is necessary to consider separately whether the agreement of the parties to the choice of jurisdiction was expressed in the form of a written agreement or in the form of an oral agreement evidenced in writing.
16. In the first place, it must be observed that, where a jurisdiction clause appears in the conditions printed on a bill of lading signed by the carrier, the requirement of an “agreement in writing” within the meaning of Article 17 of the Convention is satisfied only if the shipper has expressed in writing his consent to the conditions containing that clause, either in the document in question itself or in a separate document. It must be added that the mere printing of a jurisdiction clause on the reverse of the bill of lading does not satisfy the requirements of Article 17 of the Convention, since such a procedure gives no guarantee that the other party has actually consented to the clause derogating from the ordinary jurisdiction rules of the Convention.
17. Secondly, if it was established that the jurisdiction clause contained in the conditions printed on a bill of lading was the subject of a prior oral agreement between the parties expressly relating to the jurisdiction clause and that the bill of lading, signed by the carrier, was to be regarded as the written conformation of that oral agreement, such a clause would satisfy the conditions laid down in Article 17 of the Convention, even if it was not signed by the shipper and therefore bore only the signature of the carrier. In fact, not only is the letter of Article 17, which expressly provides for the possibility of an oral agreement evidenced in writing, thereby observed but in addition its function, which is to ensure that the agreement of the parties is clearly established, is also fulfilled.
18. Finally, such a jurisdiction clause not signed by the shipper may still satisfy the requirements laid down in Article 17 of the Convention, even in the absence of a prior oral agreement relating to that clause, provided that the bill of lading comes within the framework of a continuing business relationship between the shipper and the carrier, in so far as it is thereby established that that relationship is governed as a whole by general conditions containing the jurisdiction clause drawn up by the author of the written confirmation, in this case the carrier (see the Segoura judgment, cited above), and provided that the bills of lading are all issued on pre-printed forms systematically containing such a jurisdiction clause. In those circumstances, it would be contrary to good faith to deny the existence of a jurisdiction agreement.
19. Consequently, the reply to the first part of the question submitted must be that a jurisdiction clause contained in the printed conditions on a bill of lading satisfies the conditions laid down by Article 17 of the Convention:
If the agreement of both parties to the conditions of the bill of lading containing that clause has been expressed in writing; or
If the jurisdiction clause has been the subject of a prior oral agreement between the parties expressly relating to that clause, in which case the bill of lading, signed by the carrier, must be regarded as confirmation in writing of the oral agreement; or
If the bill of lading comes within the framework of a continuing business relationship between the parties, in so far as it is thereby established that that relationship is governed by general conditions containing the jurisdiction clause.
The second part of the question
20. As regards the validity of the jurisdiction clause as between the carrier and a third party holding the bill of lading, Goeminne Hout and the commission are of the opinion that if the third party has not signed the bill of lading the jurisdiction clause appearing on it is not enforceable against him since the agreement between the parties is not established.
21. According to the Commission, an exception may be made to that rule only if the national legal order in question embodies a theory of assignment whereby the shipper assigns his rights and obligations to the third party.
22. The governments of the Italian Republic and the United Kingdom consider that, in so far as the jurisdiction clause is valid as between the shipper and the carrier, it should also be valid as against a third party holding the bill of lading, on the ground that if, by acquiring the bill of lading, such a third party becomes entitled to exercise the rights mentioned therein he must at the same time also become subject to the obligations and limitations deriving thereform; both governments base their view on the judgment of the Court of 14 July 1983 in Case 201/82 (Gerling v Amministrazione del tesoro dello stato, unalex EU-32).
23. In this regard, it must be noted that the Gerling decision concerned a case in which a third party to an insurance contract, containing a stipulation made for his benefit by the insured, relied upon a jurisdiction clause as against the insurer, the clause being inspired, as the Court pointed out by a concern to protect the insured, who “is in a weaker economic position”. The same considerations are not necessarily relevant to the carriage of goods by sea.
24. In so far as a jurisdiction clause incorporated in a bill of lading is valid under Article 17 of the Convention as between the shipper and the carrier, and in so far as a third party, by acquiring the bill of lading, has succeeded to the shipper’s rights and obligations under the relevant national law, the fact of allowing the third party to remove himself from the compulsory jurisdiction provided for in the bill of lading on the ground that he did not signify his consent thereto would be alien to the purpose of Article 17, which is to neutralize the effect of jurisdiction clauses that might pass unnoticed in contracts.
25. In fact, in the circumstances outlined above, acquisition of the bill of lading could not confer upon the third party more rights than those attaching to the shipper under it. The third party holding the bill of lading thus becomes vested with all the rights, and at the same time becomes subject to all the obligations, mentioned in the bill of lading, including those relating to the agreement on jurisdiction.
26. It is apparent from all the foregoing considerations that the reply to the second part of the question submitted must be that the conditions laid down in Article 17 of the Convention are satisfied in the case of a jurisdiction clause contained in a bill of lading, provided that the clause has been adjudged valid as between the carrier and the shipper and provided that, by virtue of the relevant national law, the third party, upon acquiring the bill of lading, succeeded to the shipper’s rights and obligations.