parent body but may transact business at the extension.48 Thus, a merely electronic presence in the form of a web-server does not constitute an establishment;49 in the case of a contract concluded electronically through the defendant’s website, its relevant establishment will be its office from which the website is maintained. Moreover, an essential characteristic of a secondary establishment is that it must be subject to the direction and control of the parent body, so that an independently owned, exclusive distributor of a manufacturer‘s products is not a secondary establishment of the manufacturer.50 Similarly, an independent commercial agent does not constitute a secondary establishment of an undertaking which he represents, if he merely negotiates business, he is basically free to arrange his own work and decide what proportion of his time to devote to the interests of the undertaking represented, he cannot be prevented by that undertaking from also representing its competitors, and he merely transmits orders to the undertaking without being involved in either their terms or their execution.51 Conversely, one company within a corporate group will be regarded as a secondary establishment of another company in the same group, if it acts as such by negotiating and concluding transactions in the name and on behalf of the other company, at least if the companies have similar names and a common management.52 As regards operations, Art 5(5) extends to any contractual obligations entered into by the secondary establishment in the name of its parent body, regardless of where and by what establishment they are to be performed.53 It also extends to claims in respect of tortious acts authorised by the secondary establishment, regardless of where they are committed.54

Where the defendant is not domiciled in any EU member state or Lugano Convention country, but it has a secondary establishment in England, the English courts have jurisdiction, even if the dispute has no connection with the English establishment,55 but they may in discretion decline jurisdiction in favour of a court elsewhere.

Submission by appearance

Article 24 of the Regulation56 confers jurisdiction, additional to that derived from other provisions, on a court of a member state before which the defendant enters an appearance without contesting its jurisdiction, unless another court has exclusive jurisdiction by virtue of subject matter under Art 22. This applies regardless of the domiciles of the parties57 and even if the parties had previously concluded an agreement designating some other court as exclusively competent in accordance with Art 23.58

A defendant may, without submitting to the jurisdiction, simultaneously raise defences as to both jurisdiction and merits, provided that his challenge to the jurisdiction is made no later than the submissions which, under the procedural law of the court seised, are regarded as the first defence

48 See Case 33/78: Somafer v Saar-Ferngas [1978] ECR 2183; and Case C-439/93: Lloyd’s Register of Shipping v Campenon Bernard [1995] ECR I-961. Thus an embassy of an external State, situated in a Member State, may count as a secondary establishment – for example in relation to the employment of a driver at the embassy; see Case C-154/11: Mahamdia v Algeria, 19th July 2012.

49See also Directive 2000/31 on Electronic Commerce [2000] OJ L178/1; and Case C-523/10: Wintersteiger v Products 4U, 19 April 2012.

50See Case 14/76: De Bloos v Bouyer [1976] ECR 1497.

51See Case 139/80: Blanckaert and Willems v Trost [1981] ECR 819. See also per Darmon AG in Case C-89/91: Shearson Lehman Hutton v TVB [1993] ECR I-139.

52Case 218/86: Schotte v Parfums Rothschild [1987] ECR 4905. See also Latchin v General Mediterranean Holidays [2002] CLC 330 (Andrew Smith J).

53See Case C-439/93: Lloyd’s Register of Shipping v Campenon Bernard [1995] ECR I-961.

54See Anton Durbeck v Den Norske Bank [2003] QB 1160 (CA).

55See Art 4 of the Regulation; the Companies Act 2006, ss 1044, 1046 and 1139; the Civil Procedure Rules 1998, Part 6; Saab v Saudi American Bank [1999] 1 WLR 1861 (CA); and Sea Assets Ltd v PT Garuda Indonesia [2000] 4 All ER 371.

56See similarly Art 24 of the Lugano Convention, and r 13 of Sched 4 to the 1982 Act (as amended).

57See Case C-412/98: Group Josi v UGIC [2000] ECR I-5925, at paras 44–5.

58See Case 150/80: Elefanten Schuh v Jacqmain [1981] ECR 1671.

addressed to the court.59 There will be submission by appearance if the defendant, after unsuccessfully contesting the jurisdiction up to the court of last resort, then proceeds to file a defence on the merits;60 or where the defendant has taken a step in the proceedings that unequivocally indicates his acceptance of the court’s jurisdiction (e.g., where, without clearly and expressly indicating that he reserves his right to challenge the jurisdiction, he seeks an extension of time for filing his defence, or advances a defence on the merits, or threatens to seek the striking out of the claim on grounds relating to the merits, or makes an application for discovery of documents relevant to the merits).61 Submission by appearance is treated as extending to subsequent amendments to the claims that in substance relate to the same subject-matter as the original action.62 Conversely, as the European Court explained in Mietz v IntershipYachting Sneek,63 the defendant’s appearance before a court dealing with interim measures in the context of fast procedures intended to grant provisional or protective measures in case of urgency, and without prejudicing the examination of the substance, cannot by itself suffice to confer on that court unlimited jurisdiction to order any provisional or protective measure that the court might consider appropriate if it had jurisdiction as to the substance of the matter.

Ordinary contracts

For present purposes, ‘ordinary contract’ refers to any contract other than those excluded from or subjected to special rules by the Regulation (contracts relating to matrimonial property or succession on death; insurance, consumer and employment contracts; and tenancies of land).64

Article 5(1) of the Regulation confers jurisdiction on the English courts, in matters relating to an ordinary contract, where the defendant is domiciled in another member state and the place of performance of the obligation in question is in England. In full it provides:

A person domiciled in a member state may, in another member state, be sued:

(a)in matters relating to a contract, in the courts for the place of performance of the obligation in question;

(b)for the purpose of this provision and unless otherwise agreed, the place of performance of the obligation in question shall be:

–in the case of the sale of goods, the place in a member state where, under the contract, the goods were delivered or should have been delivered,

–in the case of the provision of services, the place in a member state where, under the contract, the services were provided or should have been provided;

(c)if sub-paragraph (b) does not apply then sub-paragraph (a) applies.

59 Case 150/80: Elefanten Schuh v Jacqmain [1981] ECR 1671; Case 27/81: Rohr v Ossberger [1981] ECR 2431; Case 25/81: CHW v GJH [1982] ECR 1189; and Case 201/82: Gerling v Treasury Administration [1983] ECR 2503. For procedure in England, see the CPR 1998, rr 3.1(2)(a) and 11; Maple Leaf v Rouvroy [2009] EWHC 257 (Comm); Sawyer v Atari Interactive [2005] EWHC 2351; and Global Multimedia International v Ara Media Services [2007] 1 All ER (Comm) 1160.

60 See Marc Rich v Impianti (No 2) [1992] 1 Lloyd’s Rep 624 (CA).

61 See Global Multimedia International Ltd v Ara Media Services [2007] 1 All ER (Comm) 1160; Re Anderson Owen Ltd [2009] EWHC 2837 (Ch); and Caltex v Metro [1999] 2 Lloyd’s Rep 724.

62 See Maple Leaf v Rouvroy [2009] EWHC 257 (Comm). 63 Case C-99/96, [1999] ECR I-2277.

64 See Arts 1(2)(a), 8–21 and 22(1).

In this respect, the Regulation departs significantly from the Brussels Convention, by adding sub-paras (b) and (c) to a provision formerly consisting only of sub-para (a),65 thus altering the meaning of ‘the obligation in question’.

However, the concept of contractual matters appears to be unchanged. Thus, Art 5(1) extends to a relationship (such as that between members of an association) that involves close links of the same kind as those between the parties to a contract.66 It does not apply, however, to a situation in which there is no obligation freely assumed by one party towards another, as where:

•a sub-buyer of goods sues a manufacturer who is not the direct seller to the sub-buyer, complaining of defects in the goods or their unsuitability for their intended purpose;67 or

•the action is brought by a consignee of goods carried under a bill of lading contract, and allegedly damaged in the course of such carriage, not against the issuer of the bill of lading, but against the actual carrier;68 or

•the action is founded on the defendant’s liability for the unjustified breaking off of precontractual negotiations, contrary to a legal rule requiring the parties to act in good faith in negotiations with a view to the formation of a contract;69 or

•the action is brought by a consumer protection organisation for the purpose of preventing a trader from using unfair terms in transactions with private individuals;70 or

•a guarantor who has paid customs duties under a guarantee obtained by a forwarding agent seeks, by way of subrogation to the rights of the customs authorities, to recover the sum from the goods owner, if the goods owner was not a party to, and did not authorise the conclusion of, the contract of guarantee.71

Jurisdiction under Art 5(1) is not excluded merely because the defendant disputes facts relevant to its existence, but the plaintiff must satisfy the court that the existence of such facts is strongly arguable.72

As regards ‘the obligation in question’, in a series of decisions under the Brussels Convention the European Court had established that this referred to the contractual obligation on which the plaintiff’s action was based73 or, where he made claims based on a number of obligations under

65 Where the defendant is domiciled in another part of the UK, English jurisdiction continues to be governed by a rule echoing Art 5(1) of the Brussels Convention rather than of the Regulation; see r 3(a) of Sched 4 to the Civil Jurisdiction and Judgments Act 1982, as amended by SI 2001/3929.

66 See Case 34/82: Peters v ZNAV [1983] ECR 987.

67 See Case C-26/91: Handte v TMCS [1992] ECR I-3967. Cf Atlas Shipping Agency v Suisse Atlantique [1995] 2 Lloyd’s Rep 188 (Rix J), permitting a broker to sue on a promise by the buyer, contained in a contract for the sale of a ship, to pay the broker’s commission, the promise being made to the seller but treated under English law as held by the seller on trust for the broker. Similarly, in WPP v Benatti [2007] 2 All ER (Comm) 525, the Court of Appeal accepted that a claim by a third party to a contract for breach of a contractual duty owed to him by virtue of the terms of the contract and the Contracts (Rights of Third Parties) Act 1999 falls within Art 5(1).

68 See Case C-51/97: Réunion Européenne v Spliethoff’s Bevrachtingskantoor [1998] ECR I-6511. 69 See Case C-334/00: Tacconi v Wagner [2002] ECR I-7357.

70 See Case C-167/00: VKI v Henkel [2002] ECR I-8111.

71 See Case C-265/02: Frahuil v Assitalia [2004] ECR I-1543.

72 See Case 38/81: Effer v Kantner [1982] ECR 825; Case 73/77: Sanders v Van der Putte [1977] ECR 2383; Case C-68/93: Shevill v Presse Alliance [1995] ECR I-415; Seaconsar v Bank Markazi [1994] 1 AC 438; Boss Group v Boss France [1997] 1 WLR 351 (CA); Canada Trust v Stolzenberg (No 2) [2002] 1 AC 1; Chellaram v Chellaram (No 2) [2002] 3 All ER 17 (Lawrence Collins J); Bank of Tokyo-Mitsubishi v Baskan Gida [2004] ILPr 26 (Lawrence Collins J); Bols Distilleries v Superior Yacht Services [2007] 1 Lloyd’s Rep 683 (PC); Cherney v Deripaska (No 2) [2009] 1 All ER (Comm) 333; and Deutsche Bank v Asia Pacific Broadband Wireless Communications [2009] 2 All ER (Comm) 129 (CA).

73See Case 14/76: De Bloos v Bouyer [1976] ECR 1497; Case 266/85: Shenavai v Kreischer [1987] ECR 239; Case C-288/92: Custom Made v Stawa [1994] ECR I-2913; and Case C-420/97: Leathertex v Bodetex [1999] ECR I-6747. Where the claimant sought a declaration that he

the same contract, to the principal (or most important) contractual obligation among those on which such claims were based.74 The court had specifically rejected arguments that any obligation under the relevant contract would do, or that reference should be made to the obligation which was characteristic of the contract, or that jurisdiction should belong to the court with whose territory the dispute had its closest connection. Thus, where a buyer of goods sued the seller, complaining of defects in the quality or fitness of the goods supplied, the relevant place was where the goods in question were delivered to the buyer.75 Conversely, where a seller or supplier sued for the price of goods delivered or services provided, the relevant obligation was that of the buyer or recipient to pay the price, and the place where the goods or services were delivered or provided was in itself irrelevant.76 However, Art 5(1) did not apply where the place of performance of the obligation on which the claim was based was indeterminate, because the contractual obligation at issue consisted in a negative undertaking without any geographical limitation and, therefore, having multiple places of performance, as in the case of an obligation not to participate in a competing bid for a concession.77

This case law is now to a large extent replaced by Art 5(1)(b). In the case of the sale of goods, the relevant place is now the place in a member state where, under the contract, the goods were or should have been delivered. It is clear that a contract counts as a sale of goods, rather than a contract for the provision of services, even if the goods are to be manufactured by the seller in compliance with the special requirements of the buyer. Thus, in Car Trim v KeySafety Systems,78 which involved a contract between two manufacturers in the automobile sector for the supply of components used in the manufacture of airbag systems, the European Court ruled that a contract must be regarded as a sale of goods where its purpose is the supply of goods to be manufactured or produced and the supplier is responsible for the quality of the goods and their compliance with the contract, even

was not bound to perform a contract because of the defendant’s breach of a particular term of the contract, that term was the obligation in question, and not the claimant’s obligation to perform the contract: see AIG Group v The Ethniki [2000] 2 All ER 566 (CA).

74 See Case 266/85: Shenavai v Kreischer [1987] ECR 239; and Case C-420/97: Leathertex v Bodetex [1999] ECR I-6747, which ruled that, where the claimant’s claims were based on several obligations that were of equal importance, the court was competent to entertain only those claims which were based on obligations whose places of performance were within its territory. See also Union Transport v Continental Lines [1992] 1 WLR 15 (HL); Source v TUV Rheinland Holding [1998] QB 54 (CA); and Raiffeisen Zentralbank v National Bank of Greece [1999] 1 Lloyd’s Rep 408.

75 See Thompson Hayward v Sirena [1988] ECC 319 (French Court of Cassation); Re a Consignment of Italian Wine [1988] ECC 159 (German Supreme Court); Hewden Stuart v Gottwald (1992) unreported, 13 May (CA); Viskase v Paul Kiefal [1999] 3 All ER 362 (CA); and MBM Fabri-Clad v Eisen und Huttenwerke Thale [2000] ILPr 505 (CA). See also The Sea Maas [1999] 2 Lloyd’s Rep 281, on claims for damage to or loss of cargo under a bill of lading contract; and Royal & Sun Alliance Insurance v MK Digital [2006] 2 Lloyd’s Rep 110 (CA). On exclusive distribution contracts, see Knauer v Callens [1978] I Pas Belge 871; Audi-NSU v Adelin Petit (1979) 94 Journal des Tribunaux 625; Hacker Kuchen v Bosma [1993] ECC 55; Medway Packaging v Meurer Maschinen [1990] 2 Lloyd’s Rep 112 (CA); and Boss Group v Boss France [1997] 1 WLR 351 (CA).

76 See Case 56/79: Zelger v Salinitri (No 1) [1980] ECR 89; Case 266/85: Shenavai v Kreischer [1987] ECR 239; and Case C-288/92: Custom Made v Stawa [1994] ECR I-2913. See also Mercury Publicity v Loerke [1993] ILPR 142 (CA), which involved a claim for money due under a contract of commercial agency; Chailease Finance Corp v Credit Agricole Indosuez [2000] 1 Lloyd’s Rep 348 (CA), holding that, where a beneficiary sued an issuing bank for payment under a letter of credit, it was the place of payment, and not that of presentation of the documents, which constituted the relevant place of performance, and that if the letter of credit entitled the beneficiary to choose the place of payment, by notifying the bank at the time of presentation, Art 5(1) enabled the beneficiary to sue at the place thus notified; and Tavoulareas v Tsavliris [2006] 1 All ER (Comm) 109, holding that, in the case of a loan which is governed by English law and is repayable on demand, Art 5(1) confers jurisdiction over a claim for repayment on the court for the creditor’s residence at the time of the demand.

77 See Case C-256/00: Besix v WABAG [2002] ECR I-1699. See also Mora Shipping v Axa Corporate Solutions Assurance [2005] EWCA Civ 1069; Montagu Evans v Young [2000] SLT 1083; and Swan v Kall Kwik [2009] CSOH 99. Cf Kenburn Waste Management v Bergmann [2002] ILPr 33 (CA), holding that, in the case of a negative obligation to produce a result in a particular country (e.g., not to communi-

cate threats of patent litigation to persons there), the place of performance would be in the country where the result was to be achieved.

78 Case C-381/08, [2010] ECR I-1255.

though the purchaser has specified certain requirements with regard to the provision, fabrication and delivery of the goods to be produced, unless the purchaser has supplied all or most of the materials from which the goods are manufactured.

In Color Drack v LEXX International,79 the European Court ruled that Art 5(1)(b)(i) of the Regulation is applicable where there are several places of delivery under a single contract of sale – for example, where the seller has to make separate deliveries of different consignments to various customers of the buyer at their respective residences. In such a case, the court that is competent to hear all the claims based on the contract for the sale of goods is the court for the principal place of delivery, which must be determined on the basis of economic criteria. If the principal place of delivery cannot be ascertained, the plaintiff may sue the defendant in the court for the place of delivery of its choice.

In Car Trim v KeySafety Systems,80 which involved a sale of components by a German manufacturer to an Italian manufacturer, the European Court ruled that, in the case of a sale involving carriage of goods, the place of delivery must be determined primarily on the basis of the express provisions of the contract. Where it is possible to identify the place of delivery in that way, without reference to the substantive law applicable to the contract, it is the place so identified that is to be regarded as the place of delivery for the purposes of Art 5(1)(b)(i) of the Regulation. In the absence of such a contractual provision, it is the place where the goods were or should have been physically transferred to the purchaser at their final destination, so as to place them at the actual disposal of the purchaser, which counts as the place of delivery under Art 5(1)(b)(i). In Electrosteel Europe v Edil Centro,81 the European Court added that, for this purpose, account must be taken of all the relevant terms of the contract that are capable of clearly identifying the place of delivery, including terms generally recognised and applied through the usages of international trade or commerce, such as the Incoterms drawn up by the International Chamber of Commerce in the version published in 2000. The result of these rulings appears to be that in the case of an FOB sale, delivery will be regarded as taking place at the port of loading; however, in the case of a C&F sale, or a hybrid sale that has some FOB and some C&F features, delivery will be regarded as taking place at the port of discharge.

As regards Art 5(1)(b)(ii), on contracts for the provision of services, in Falco v Weller-Lindhorst,82 the European Court explained that, for this purpose, the concept of service implies that the party who provides the service carries out a particular activity in return for remuneration. Thus, Art 5(1) (b)(ii) does not extend to a contract under which the owner of an intellectual property right, such as a copyright, grants its contractual partner a licence to use the right in return for remuneration, since such a contract does not involve an activity by the licensor, but only an obligation by the licensor not to challenge the use of the right by the licensee, and it is immaterial whether the licensee is obliged to use the right licensed. It may be inferred from this ruling that Art 5(1)(b)(ii) does not apply to contracts under which the service takes the form of a monetary payment (such as contracts of loan,83 contracts of reinsurance, contracts of guarantee,84 and bankers’ letters of credit), nor to contracts under which both of the parties have obligations to perform substantial activities other than the making of monetary payments (such as franchising contracts, exclusive distribution

79 Case C-386/05, [2007] ECR I-3699. See also Case C-204/08: Rehder v Air Baltic [2009] ECR I-6073, which extended these principles to cases where the various places of delivery are located in different Member States.

80 Case C-381/08, [2010] ECR I-1255.

81 Case C-87/10, [2011] ECR I-4987.

82 Case C-533/07, [2009] ECR I-3327.

83 See Tavoulareas v Tsavliris [2006] 1 All ER (Comm) 109.

84 See Commercial Marine Piling Ltd v Pierse Contracting Ltd [2009] EWHC 2241 (TCC).

contracts, and contracts between an author and a publisher for the writing and publication of a literary work).

Conversely, it is clear that Art 5(1)(b)(ii) applies to contracts for professional services (such as those of an architect, a lawyer, an accountant, or a tax adviser), contracts for commercial services (such as the erection, improvement or repair of a building, or the servicing or repair of a vehicle, or the activities of a commercial agent in the negotiation or conclusion of transactions on behalf of a principal) and contracts for the carriage of goods or passengers.

In Rehder v Air Baltic,85 which involved a contract for the carriage of a passenger by air from Munich in Germany to Vilnius in Lithuania by a Latvian airline, the European Court established the principle that Art 5(1)(b)(ii) confers jurisdiction on the courts for the place or places at which the main provision of services is to be carried out. Thus, in the case of a contract for the carriage of a passenger by air from one member state to another member state, Art 5(1)(b)(ii) confers jurisdiction both on the court for the place of departure of the aircraft and on the court for the place of arrival of the aircraft, as specified in the contract, and gives the plaintiff the choice of suing in either of those courts. Since air transport consists, by its very nature, of services provided in an indivisible and identical manner from the place of departure to that of arrival of the aircraft, in such cases one cannot distinguish a separate part of the service as the principal service on the basis of an economic criterion.

In Wood Floor Solutions v Silva Trade,86 the European Court ruled that, in the case of a contract of commercial agency, it is the commercial agent who performs the obligation which characterises the contract and who provides the services. Thus, where there are several places where services are provided by the agent, Art 5(1)(b)(ii) refers to the place of the main provision of services by the agent, and this place must, where possible, be identified by reference to the provisions of the contract. If the provisions of a contract do not enable the place of the main provision of services to be determined (either because they provide for several places where services are provided or because they do not expressly provide for any specific place where services are to be provided), but the agent has already provided such services, reference must be made to the place where he has, in fact, for the most part, carried out his activities in the performance of the contract, provided that the provision of services in that place is not contrary to the provisions of the contract. For this purpose, account may be taken of the time spent in a place and the importance of the activities carried out there. As a last resort, where the place of the main provision of services cannot be determined on the basis of the provisions of the contract itself or its actual performance, reference must be made, in the case of services provided by a commercial agent, to the place where the agent is domiciled.

It may perhaps be inferred from the ruling in Wood Floor Solutions that the European Court will strive to ensure that, for each type of contract for the provision of services, there is a specific connection that must always exist and that serves as the indication of the place of service provision, unless displaced by the terms of the contract or its actual performance.

Another difficulty arises from the reference in Art 5(1)(b) of the Brussels I Regulation to a contrary agreement, which will apparently exclude Art 5(1)(b). It seems that the effect of such an agreement (that the place of delivery or service provision shall not be regarded as the place of performance) will be to eliminate the operation of Art 5(1)(b) and restore the operation of the Brussels Convention approach, in accordance with Art 5(1)(a) and (c).

The effect of Art 5(1)(a) and (c) of the Regulation is to preserve the Brussels Convention approach, referring to the place of performance of the obligation on which the sole claim or principal claim made by the plaintiff is based, in cases where the new rules specified by Art 5(1)

85 Case C-204/08, [2009] ECR I-6073.

86 Case C-19/09, [2010] ECR I-2121.

(b) of the Regulation, referring to the place of delivery or service provision, do not apply. In Falco v Weller-Lindhorst,87 the European Court confirmed that the EU legislature intended, in relation to Art 5(1) of the Regulation, to maintain, for all contracts other than those concerning the sale of goods and the provision of services, the principles established by the Court in relation to the Brussels Convention, regarding the obligation to take into consideration, and the determination of the place of its execution. Thus, the effect to be given to Art 5(1)(a) of the Regulation should be identical to that of Art 5(1) of the Convention, and, for this purpose, reference must continue to be made to the principles that result from the case-law of the European Court on Art 5(1) of the Convention.

There appear to be at least four situations in which Art 5(1)(a) may apply. The most obvious and uncontroversial is where the contract is not for the sale of goods or the provision of services, but (for example) for the sale of land or corporate securities (shares or bonds), or for the exchange of goods (guns for butter), or for the licensing of an intellectual property right,88 or for a loan of money, repayable on demand.89 Other cases in which Art 5(1)(a) may arguably apply are where the place of delivery or service provision is not located in a member state, but in an external country or outside any national territory (such as on the high seas), or where the place of delivery or service provision is indeterminate, as where goods have to be delivered or services provided at a frontier, or where one party has an option to choose the place of delivery or service provision and has not done so. A fourth (and less controversial) case is where the parties have agreed to exclude the operation of Art 5(1)(b) and have not also made a valid agreement on exclusive jurisdiction in accordance with Art 23, so as to exclude Art 5(1) altogether.

It is probable that (in both the Regulation and the Brussels Convention) Art 5(1) is confined to actions based on a contractual obligation, in the normal sense of a promise that constitutes a valid term of a binding contract (or equivalent transaction) so that its non-performance is actionable as a breach of contract. Thus, a claimant can invoke Art 5(1) only where he bases his claim on an allegation that the defendant has committed or threatened to commit one or more breaches of a valid contract between them. However, it does not matter whether he seeks damages for breach, specific performance, restoration of benefits for which (owing to the defendant’s breach) the consideration has failed, or a declaration that by reason of the defendant’s breach the plaintiff is released from his obligations under the contract. In contrast, Art 5(1) is not available to a claimant who seeks restitution of money paid under a contract that is indisputably void ab initio on account of the defendant’s incapacity to enter into the contract;90 nor to a claimant who seeks a negative declaration that, contrary to the defendant’s assertion, no exclusive distribution contract exists between the parties.91 Nor is Art 5(1) available to a claimant who complains of the defendant’s misconduct in pre-contractual negotiations, whether by way of misrepresentation or non-disclosure, or of breaking off negotiations unexpectedly and in bad faith, and whether he seeks rescission or damages.92

87 Case C-533/07, [2009] ECR I-3327.

88 See Case C-533/07: Falco and Rabitsch v Weller-Lindhorst [2009] ECR I-3327. 89 See Tavoulareas v Tsavliris [2006] 1 All ER (Comm) 109.

90 See Kleinwort Benson v City of Glasgow DC [1999] AC 153.

91 The contrary was held in Boss Group v Boss France [1997] 1 WLR 351 (CA), but the decision seems irreconcilable with the subsequent ruling of the House in Kleinwort Benson v City of Glasgow District Council [1999] AC 153. However, in Youell v La Reunion Aerienne

[2009] EWCA Civ 175, the Court of Appeal regarded itself as still bound by its decision in Boss Group.

92 See Case C-334/00: Tacconi v Wagner [2002] ECR I-7357, where the European Court held that an action founded on the defendant’s liability for the unjustified breaking off of pre-contractual negotiations, contrary to a legal rule requiring the parties to act in good faith in negotiations with a view to the formation of a contract, is not within Art 5(1), since there is no obligation

freely assumed by one party towards another. It explained (rather puzzlingly) that, although Art 5(1) does not require a contract to have been concluded, it is, nevertheless, essential to identify an obligation since jurisdiction is determined by the place of