|
||||||||||||||||||
| Abstract | ||||||||||||||||||
| ||||||||||||||||||
| An Italian company concluded a contract with a British company for the manufacture and supply of leather items to be marked with the brand of the latter. The Italian company started a legal action claiming avoidance of the contract for fundamental breach by the British company as well as damages. During the course of the first instance proceedings the defendant, objecting to the jurisdiction of Italian courts, commenced an action before the Italian Supreme Court in order to get a final decision on this matter.
In order to determine whether Italian Courts had jurisdiction, the Court applied Art. 5(1) of the EC Convention on Jurisdiction and the Enforcement of Foreign Judgments in Civil and Commercial Matters (Brussels 1968), which states that a person domiciled in a Contracting State may be sued in the Court for the place of performance of the obligation in question. The Court asserted jurisdiction against the buyer. The Court drew the distinction between a sales contract and a works contract when one of the parties, as in the case at hand, is obliged to supply both goods and services. In the Court's opinion, such a difference is to be drawn with regard to the fundamental purpose of the agreement and to the meaning that the supply of the materials necessary for the manufacture of the goods and the services to be provided has in connection with the result the materials are meant to reach. Under Art. 3 CISG, as well as under the relevant Italian provisions, there is a works contract when the materials are mere means for the production of the goods, and the production of the goods is the essential purpose of the contract. The Court noted that had the contract been a sales contract, the obligation in question would have been the buyer's obligation to pay the price, which according to Art. 57 CISG as well as to Italian domestic law, is to be performed at the place of business of the creditor (the seller). |