Nejvyšší soud; 2019-08-28; 27 Cdo 4352/2017
Decision by national courts in the field of European Union law — ECLI:CZ:NS:2019:27.CDO.4352.2017.2
Date: 2019-08-28
Subject matter: Judicial cooperation in civil matters;Lugano Convention
Origin: Czechia

82019CZ0828(51)_ENG_SUMJURE
JURE summary
JURE summary
This case regards a question of international jurisdiction of the Czech courts resolved by the Nejvyšší soud (hereinafter ‘the Supreme Court’).
A company domiciled in Czechia (hereinafter ‘the plaintiff’) brought an action against its only shareholder – a company domiciled in the Netherlands (hereinafter ‘defendant 1’) – and against a member of the board of directors of the plaintiff domiciled in Switzerland (hereinafter ‘defendant 2’). The plaintiff alleged that the defendants, through the conduct of unlawful activities, gained unjust enrichment to the detriment of the plaintiff. The proceedings commenced before the Krajský soud v Ostravě (hereinafter ‘the Court of First Instance’).
Defendant 2 objected to the jurisdiction of the Czech courts on the grounds of his Swiss domicile and requested the termination of the proceedings. The Court of First Instance invoked Article 5(3) of the new Lugano Convention (1), according to which ‘[a] person … may … be sued … in matters relating to tort, delict or quasi-delict, in the courts for the place where the harmful event occurred or may occur’. It held that the plaintiff suffered the alleged financial damage in Czechia, therefore, pursuant to the concept of the location of the harmful event, the jurisdiction of the Czech courts is justified. The argument laid down by defendant 2 that Article 6(1) of the new Lugano Convention provides for the jurisdiction of the Swiss courts, as he was ‘one of a number of defendants’, was dismissed.
The Vrchní soud v Olomouci (hereinafter ‘the Court of Appeal’) confirmed the first instance conclusions. It held that Article 5(3) and Article 6(1) of the new Lugano Convention are provisions that are independent of each other. Article 6(1) is applicable in the case of closely connected claims where there is a risk of irreconcilable judgments resulting from separate proceedings. However, the present case only involves one common claim against two defendants and no separate proceedings are expected. The first instance decision was upheld.
Defendant 2 filled a cassation appeal with the Supreme Court, alleging the erroneous application of the new Lugano Convention, a wrongful assessment of the place where the damage occurred, the omission of a referral of the question to the Court of Justice of the European Union (CJEU) and a breach of procedural rules.
The Supreme Court held that Article 5(3) and Article 6(1) of the new Lugano Convention had been interpreted by the CJEU several times, that the interpretations were clear and that there was no need to refer a new question to the CJEU on this topic. The conclusion of the Court of Appeal that the two provisions are independent of each other was correct. The claim based on unjust enrichment and/or a breach of the duties of the member of the board of directors falls within the meaning of tortious conduct covered by Article 5(3) of the new Lugano Convention. Therefore, this provision is applicable to the present case. The assessment of the place where the damage occurred was held to be correct too, carried out in accordance with the case of the CJEU. The financial loss of a company domiciled in Czechia justifies the jurisdiction of the Czech courts. The duties of defendant 2 as a member of the board of directors of the plaintiff will have been carried out in the place where the plaintiff was domiciled, which was again Czechia.
The cassation appeal was dismissed.
(1) Convention on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters.