Europa Jurisdiction Regulation (EC) No 44/2001 Point 2 of Article 22 Disputes as to the validity of decisions of organs of companies Exclusive jurisdiction of the courts of the State where the company has its seat Medical practitioners’ mutual defence organisation.
In proceedings in Ireland relating to a medical negligence claim against the Health Board, two doctors who had been involved in the incident in question were joined in a claim for contribution brought by the Health Board. The doctors in turn sought an indemnity or contribution from the Medical Defence Union in England (‘the MDU’), of which they were members, to which they claimed they had an entitlement under the MDU’s articles of association. The MDU’s board decided to reject their claim, so the doctors sought to join the MDU in the Irish proceedings to claim in those proceedings the indemnity or contribution to which they maintained they were entitled. The MDU resisted this on the basis that the doctors’ claim concerned the validity of the board’s decision and so fell within article 22(2), with the result that the English courts had exclusive jurisdiction in relation to that claim. This issue was referred to the Court of Justice, which disagreed with the MDU. The court held that article 22(2) had to be interpreted ‘strictly’ (that is to say, narrowly), since it was an exception to the general rule of jurisdiction under the Regulation based on domicile, and that it should ‘not be given an interpretation broader than is required by [its] objective’ (paras 18-19); accordingly, the provision ‘must be interpreted as covering only disputes in which a party is challenging the validity of a decision of an organ of a company under the company law applicable or under the provisions governing the functioning of its organs, as laid down in its Articles of Association’ (para 26). Since the doctors were not challenging the fact that the MDU’s board was ’empowered’ under the articles to take the decision it did, but were challenging ‘the manner in which that power was exercised’, the dispute between the doctors and the MDU did not fall within article 22(2). The court did not approach the application of article 22(2) by making an evaluative judgment about how the doctors’ claim related to the proceedings in Ireland, but instead focused its analysis on the specific nature of the claim against the particular defendant, the MDU. In view of its strict approach to the interpretation of article 22(2), it held that it could not be said that, in order for that provision to apply, it is sufficient that a legal action involve merely some link with a decision adopted by an organ of a company
Citations:
ECLI:EU:C:2008:534, [2008] EUECJ C-372/07, [2008] ECR I-7403, [2009] ILPr 28, [2009] CEC 390, (2009) 105 BMLR 115
Links:
Statutes:
Brussels I Recast Regulation (Parliament and Council Regulation (EU) 24(2)
Jurisdiction:
European
Cited by:
Cited – Akcil and Others v Koza Ltd and Another SC 29-Jul-2019
The first claimant was an English company all of whose shares were owned by a Turkish company. The second claimant as director caused changes to the company’s constitution and share structure. The parties disputed the jurisdiction of the UK Courts . .
Cited – Akcil and Others v Koza Ltd and Another SC 29-Jul-2019
The first claimant was an English company all of whose shares were owned by a Turkish company. The second claimant as director caused changes to the company’s constitution and share structure. The parties disputed the jurisdiction of the UK Courts . .
Lists of cited by and citing cases may be incomplete.
Jurisdiction
Updated: 18 April 2022; Ref: scu.276778
