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Order of the Danish High Court
Eastern Division
chamber no. 4 of 22 January 1996
Case No. B-3112-95
Dänishes Bettenlager GmbH & Co. KG v. Forenede Factors A/S
Court composed of Harald Boas, Plessing, B.
O. Jespersen.
Appearances: J. O. Kock, advokat, for the Claimant;
Ebbe Suenson, advokat, for the Defendant.
Appeal from the District Court.
Order of Glostrup County Court of 22 October 1995:
In the proceedings, which were brought on 31 January 1994, the Claimant claimed that the Defendant be ordered to pay DKK 2,040,064.07 plus interest at a specified amount.
The claim, which was later reduced, concerns payment for consignments of goods under a number of invoices made out by Dansk Rattan A/S during the period from 23 April to 28 August 1992. Under a contract of 22 December 1987 between the Claimant and Dansk Rattan A/S, these invoices were assigned to the Claimant under an invoicing arrangement.
Dansk Rattan A/S has subsequently become subject to insolvency proceedings.
In its primary claim, the Defendant moved for a dismissal arguing that the Danish courts had no jurisdiction over the Defendant. In the alternative, the Defendant moved for a dismissal, because the it had not received proper notice of the assignments, and because of set-offs relating to consignments from the Defendant to Danish Rattan A/S, which exceeded the amount claimed. Furthermore, the amounts claimed largely related to substitute goods replacing goods that had been delivered and paid for. Finally, the Defendant claimed that, in several consignments, the goods did not conform to the terms of the contract.
The question concerning the jurisdiction of the court has been considered separately.
The Claimant relied on Article 5(1) of the EC Judgments Convention.
The Claimant also relied on a letter dated 17 December 1993 from the Defendant’s German lawyer, which contains a passage reading:
“Die Muttergesellschaft unserer Mandantin hat ihren Sitz in Dänemark. Vor diesem Hintergrund sehen wir keine Schwierigkeiten einen Rechtstreit vor dem für den Sitz der Fa. Danish Rattan zuständigen Gericht zu führen,“ [The principal place of business of the parent company of our client is situated in Denmark. Consequently we see no problems having a dispute heard by the court in whose district the principal place of business of Danish Rattan is situated]
and the Claimant submitted that this constitutes a choice-of-forum agreement.
The Defendant submitted that there is no contractual relationship between the parties to these proceedings and consequently, proceedings must be brought at the defendant’s home court in Flensburg pursuant to Article 5(3). The defendant further submitted that the letter of 17 December 1993 from the Defendant’s German lawyer and invoked by the Claimant did not constitute a choice-of-forum agreement, but was merely a statement to the effect that it would present no serious problem to the Defendant if the proceedings were brought in Denmark.
Grounds of the order:
The court holds that the letter of 17 December 1993 does not constitute a choice-of-forum agreement.
The claim is based on an assignment by the original creditor to the Claimant, so that the Claimant has become a party to the contract between Dansk Rattan A/S and the Defendant. As the Claimant has become a party to the contract between the Defendant and Dansk Rattan A/S, the claim is governed by Article 5(1) of the EC Judgments Convention.
The court does not hereby decide the extent to which the Claimant has a valid claim.
The court further observes that according to Article 5(1), the decisive factor is the place of performance of the obligation to pay. As this case concerns international sale of goods, this question will have to be decided according to CISG (Convention on Contracts for the International Sale of Goods), which was ratified by both Denmark and Germany in 1990. According to Article 57 of the Convention, payment must be made at the seller’s place of business unless otherwise agreed. As the existence of a contrary agreement has not been proved to the satisfaction of the court, the place of performance is in Denmark and consequently, this court is the court of competent jurisdiction.
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Order of the Danish High Court:
This court holds that the Defendant’s obligation to pay is governed by Article 5(1) of the EC Judgments Convention, and that the place of performance is in Denmark. On those grounds the court hereby rules:
Appeal dismissed.
TRANSLATION: Associate Professor Sandro Nielsen, Ph.D., M.A.(LSP), Aarhus School of Business, Department of English.
