Federal Supreme Court on International Jurisdiction for Off-premises Consumer Contracts

“Successful financial centre. Knowledgeable, secure, with professional service”, reads the caption to this picture of Vaduz at night on Liechtenstein’s official website.The German claimant in a case decided recently by the Federal Supreme Court (Bundesgerichtshof)  apparently did not agree. He sought to undo his asset management contract with a Liechtenstein counterparty which provided for the jurisidction of the Liechtenstein courts. The claimant commenced legal proceedings in Germany, but both the District Court (Landgericht) and the Court of Appeals (Oberlandesgericht) dismissed the action for lack of international jurisdiction of the German courts, as the asset managemet contract provided for the jurisdiction of the Liechtenstein courts.

The Federal Supreme Court, however, took a different view and found in favour of the claimant. The court had to assume, for procedural reasons, that the asset management contract was a “doorstep contract” with a consumer (Haustürgeschäft) within the meaning of Section 29 German Code of Civil Procedure (ZPO), i.e. a contract concluded off the business premesis of the contracting party. Section 29c ZPO in such a case provides for the exclusive jurisdiction of the courts at the consumer’s domicile. As a result, the agreement on the jurisdiction of the Liechtenstein courts deviating from the jurisdictional rules in Section 29c para. 1 ZPO was invalid.

The lower courts had, the wording of Section 29c ZPO nothwithstanding, applied the general principle that an agreement on jurisdiction is permitted if one of the parties is domiciled abroad. On that basis, they had upheld the agreement on the Liechtenstein courts. The Federal Supreme Court construed Section 29c ZPO to be absolute and not allowing for any exemptions. The matter has been referred back to the Court of Appeals to establish whether the agreement in question indeed was a doorstep contract.

 

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