Italian jurisdiction - contract of sale - non EU countries
Tribunal of Pisa - Judgment 29 September 2004, Conceria Adige Co. v. Sinochem Industries Ltd.
The criteria laid down by the Brussels Convention of 27 September 1968 are applicable also to assess the existence of the jurisdiction of Italian courts upon a defendant domiciled in country (in the specific case: China) outside the European Union.According to art. 5(1) of the Brussels Convention, a foreign defendant can be sued before the courts of the country of the place where the obligation that is the object of the claim was, or should have been, executed. In the case of a claim on damages, the above obligation is the obligation the breach of which is the object of the claim.
The above place must be determined pursuant to the law applicable to the contract; such a law shall be assessed in accordance with Italian international private law.Nevertheless, in the case of a contract of sale of goods between parties who are resident of countries that (like Italy and China) are members of the Vienna Convention of 11 April 1980, such a convention will be the applicable law to the contract and the above place shall be determined in accordance with its provisions.
According to articles 31 and 35 of the above convention, the main obligation of the seller is that of delivering goods that comply with the contract's requirements. When the goods must be delivered to a foreign buyer, such an obligation will be performed at the place where the goods are handed over to the first carrier. As a consequence, the obligation of the seller should have been fulfilled abroad (in the specific case: at the Chinese port of delivery) and, therefore, Italian courts do not have jurisdiction to adjudicate over the claim.
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The case decided by the Tribunal of Pisa concerned a contract of sale of goods between a Chinese seller and an Italian buyer. The Italian buyer filed a claim on damages before the court of Pisa, alleging that the goods were defective.
The Italian court denied jurisdiction on a basis of a well established case law, that however referred mostly to the Hague Convention of 1964 (that was applicable to international contracts of sale before the entry into force of the Vienna Convention).
Important is also the extension, based on art. 3 of the Act 31 May 1995 no. 318 ('Act on the reform of Italian international private law'), to countries outside the European Union of the rules for assessing jurisdiction on contracts, laid down by the Brussels Convention of 1968.
The consequence of the judgment is that the Italian buyer should have sued the Chinese seller before the competent court in China. A different conclusion was reached in other cases where the contract provided that the goods (specifically, machinery) were to be installed by the seller at the buyer's plant in Italy. In such a case (for example: Court of Cassation, joint chambers, 10 March 2000, 'Krauss Maffei Verfahrenstechnik GmbH v. Bristol Meyers Squibb Co.'), it was said that the obligation of the seller did not consist of simply delivering the goods to the first carrier in his country of residence, but that it should have been fulfilled in Italy, with the consequence that Italian courts had jurisdiction upon the foreign seller.