Rome II Non-Contract

The Rome II Regulation applies after 11 January 2009.  Where the events giving rise to damage occurred both before and after that date, difficulties of interpretation may apply. In the case of product liability, the European courts have held that the event giving rise to damage is the manufacture rather than the later sale or use of the product.

Rome II applies to noncontractual obligations in civil and commercial matters. It applies to any consequence arising out of a tort/ delict, unjust enrichment, negotiorum gestio or culpa in contrahendo.The latter categories refer to precontract fault

Rome II does not apply to noncontractual obligations arising out of

family relations including maintenance matrimonial property regimes

wills successions

bills of exchange cheques  and promissory notes to the extent they arise out of their negotiable character

laws of companies such as creation capacity winding up

relationship between settlor trustees and beneficiaries.

It does not apply to matters of evidence and procedure.

It does not apply to the liability of states exercising statutory powers. It does not apply to non-contractual obligations arising out of the law of companies and other bodies corporate or unincorporated regarding matters such as the creation, by registration or otherwise, legal capacity, internal organisation or winding-up of companies and other bodies corporate or unincorporated, the personal liability of officers and members as such for the obligations of the company or body and the personal liability of auditors to a company or to its members in the statutory audits of accounting documents;

It does not apply to noncontractual obligations arising out of nuclear damage. It does not apply to noncontractual obligations arising out of violations of privacy rights were lessened related personality including defamation.

It uses the concept of habitual residence in various contexts.

There is provision for choice of law in relation to noncontractual obligations. See the separate chapter in this regard. Parties may make an agreement confirming the applicable law. It must be an agreement entered into after the event giving rise to the damage. If the agreement is made before the occurrence of the event, it is binding only if the parties are pursuing commercial activity, and the agreement was freely negotiated.

It must be demonstrated with reasonable certainty. Questions of interpretation are answered by the choice of law.

Uniformity of law is sought to be achieved. The Regulation is to be interpreted in accordance with principles of the EU law, declared by the EU courts.

The applicable law decides who has the burden of proof. It also determines any presumption relating to causation or fault. Applicable law  governs contribution and compensation. It covers the

• basis of liability
• who may be held liable for the acts of another – vicarious liability
  exemption from liability
• limitation of liability
• contributory negligence
• apportionment of liability
• the existence nature and assessment of damage and
• the remedy claimed
• guidelines tariffs and other quasilegal indications of compensation in the legal system concerned

The law applicable to non-contractual obligations under this Regulation shall govern in particular:

• the basis and extent of liability, including the determination of persons who may be held liable for acts performed by them;
• the grounds for exemption from liability, any limitation of liability and any division of liability;
• the existence, the nature and the assessment of damage or the remedy claimed;
• within the limits of powers conferred on the court by its procedural law, the measures which a court may take to prevent or terminate injury or damage or to ensure the provision of compensation;
• the question whether a right to claim damages or a remedy may be transferred, including by inheritance;
• persons entitled to compensation for damage sustained personally;
• liability for the acts of another person;
• the manner in which an obligation may be extinguished and rules of prescription and limitation, including rules relating to the commencement, interruption and suspension of a period of prescription or limitation.

 

The applicable law may be displaced under certain circumstances by the law of the jurisdiction hearing the matter. Overriding mandatory provisions of the law of the court where the case is heard may disapply the law otherwise applicable.  A provision of applicable law may be refused application where it would be manifestly incompatible with the public policy of the forum. For example, if the applicable law would lead to recovery of non-compensatory exemplary or punitive damages this might be found objectionable in the domestic jurisdiction.

 

In the Rome II regulation,  law means the law of the country concerned and not its private international rules. Therefore, renvoi does not apply. A direct claim may be brought against an insurer it was permitted by the law which governs the noncontractual obligation or the law governing the insurance contract.

 

 

Chapter 2 of the Regulation applies to torts /  civil wrongs. Chapter 3 applies to noncontractual obligations which may include matters such as misrepresentation or fraud or so on, which relate to failed contracts.

 

Unless otherwise the law applicable to a non-contractual obligation arising out of a tort/delict shall be the law of the country in which the damage occurs irrespective of the country in which the event giving rise to the damage occurred and irrespective of the country or countries in which the indirect consequences of that event occur.

However, where the person claimed to be liable and the person sustaining damage both have their habitual residence in the same country at the time when the damage occurs, the law of that country shall apply.

Where it is clear from all the circumstances of the case that the tort/delict is manifestly more closely connected with a country other than that those above, the law of that other country shall apply. A manifestly closer connection with another country might be based in particular on a pre-existing relationship between the parties, such as a contract, which is closely connected with the tort/delict in question.

 

 

 

Damage covers any consequence arising out of the tort/ unjust enrichment et cetera

 

The legislation requires the damage to be located. This may not always be straight forward. In some cases, it may be possible to centralise the occurrence in a single place

 

In the case of personal injuries is usually apparent where the damage occurs. However, if damage occurs over a period of time, it may not be so clear.

 

In the case of damage to personal property, it is usually clear where the item was at the time of damage. In the case of intangible property, the position may be sometimes,  less clear.

 

In some cases, difficulties of interpretation may arise in relation to financial loss. For example, where the damage arises from relying on false information. It may be the place at which the losses ultimately crystallise. It may be difficult to distinguish between immediate and consequential loss.

 

The European Court distinguishes between the direct occurrence of damage and adverse impacts on others such as by way of after effects. The Regulation looks to the primary victim.

 

If in all the circumstances the tort is more manifestly connected with another country the law of that country is to apply instead. This may arise from a pre-existing relationship such as a contract. This is separate from the provisions regarding choice of law in the context of tort.

 

Special rules apply to certain types of loss. In the case of product liability if the claimant and defendant are habitually resident in the same country the law of the country in which the person sustaining the damage had his or her habitual residence when the damage occurred, if the product was marketed in that country apples.   Failing that, it is

 

the law of the country in which the product was acquired, if the product was marketed in that country; or, failing that,

 

(c)	the law of the country in which the damage occurred, if the product was marketed in that country.

However, the law applicable shall be the law of the country in which the person claimed to be liable is habitually resident if he or she could not reasonably foresee the marketing of the product, or a product of the same type, in the above countries.

 

Where it is clear from all the circumstances of the case that the tort/delict is manifestly more closely connected with a country other than that indicated above, the law of that other country shall apply. A manifestly closer connection with another country might be based in particular on a pre-existing relationship between the parties, such as a contract, which is closely connected with the tort/delict in question.

 

 

Unfair competition and acts restricting free competition

 

The law applicable to a non-contractual obligation arising out of an act of unfair competition shall be the law of the country where competitive relations or the collective interests of consumers are, or are likely to be, affected.

 

Where an act of unfair competition affects exclusively the interests of a specific competitor, the general law shall apply.

 

The law applicable to a non-contractual obligation arising out of a restriction of competition shall be the law of the country where the market is, or is likely to be, affected.

 

When the market is, or is likely to be, affected in more than one country, the person seeking compensation for damage who sues in the court of the domicile of the defendant, may instead choose to base his or her claim on the law of the court seised, provided that the market in that Member State is amongst those directly and substantially affected by the restriction of competition out of which the non-contractual obligation on which the claim is based arises; where the claimant sues, in accordance with the applicable rules on jurisdiction, more than one defendant in that court, he or she can only choose to base his or her claim on the law of that court if the restriction of competition on which the claim against each of these defendants relies directly and substantially affects also the market in the Member State of that court.

 

 

The law applicable to a non-contractual obligation arising out of environmental damage or damage sustained by persons or property as a result of such damage shall be the law determined pursuant to the general rule, unless the person seeking compensation for damage chooses to base his or her claim on the law of the country in which the event giving rise to the damage occurred.

 

 

Infringement of intellectual property rights

 

The law applicable to a non-contractual obligation arising from an infringement of an intellectual property right shall be the law of the country for which protection is claimed.

 

In the case of a non-contractual obligation arising from an infringement of a unitary EU intellectual property right, the law applicable shall, for any question that is not governed by the relevant Community instrument, be the law of the country in which the act of infringement was committed.

 

Industrial action

 

Without prejudice to the general rule,  the law applicable to a non-contractual obligation in respect of the liability of a person in the capacity of a worker or an employer or the organisations representing their professional interests for damages caused by an industrial action, pending or carried out, shall be the law of the country where the action is to be, or has been, taken.