The Italian Supreme Court on Jurisdiction over a Procurement Contract (and its Applicable Law)

Two weeks ago (10 January 2023), the Grand Chamber of the Italian Supreme Court (Corte di Cassazione, Sezioni Unite) delivered its order No 361/2023, declaring Italian jurisdiction over an action for breach of contract brought by an Italian company against a French company. According to the contract in dispute, the French company undertook the obligations to supply an industrial plant, delivered at its premises, and to install it at the Italian company’s premises, as well as other activities, performed in Italy, such as making electrical and water connections, starting-up and testing the plant. However, since the beginning, the plant had exhibited such failures, defects and malfunctions that countless technical interventions had to be carried out with production stoppages and loss of products.

The French company pleads lack of Italian jurisdiction on the basis of a clause, included in the general terms and conditions of sale, containing a choice-of-court and choice-of-law agreement in favour of French courts and French law.

Although the contract consists of a single document subdivided into several chapters, preceded by a summary listing its chapters from A to I, the general terms and conditions of sale, listed under I in the summary, were not signed.

For this reason, pursuant to Art 17 of the 1968 Brussels Convention, applicable ratione temporis – read in conjunction with Art 23 of Regulation (EC) No 44/2001 and Art 25 of Regulation (EU) No 1215/2012 – the Supreme Court declared that the clause contained in the general terms and conditions of the contract does not derogate Italian jurisdiction since it was not signed, nor was it expressly referred to in the text of the signed contract. Therefore, it cannot be inferred that the choice-of-court clause was the object of a specific negotiated agreement between the parties, manifested in a clear and precise manner, from the mere indication of the chapter containing the general terms and conditions of sale in the summary of the contract.

Eventually, after having characterised the contract as procurement, the Supreme Court declared Italian jurisdiction on the ground of Art 5(1) of the 1968 Brussels Convention, since it was in Italy, according to Italian law, the place of performance of the obligation in question; Italian law applies to the contract, as per Art 4 of the 1980 Rome Convention, being Italy the country with which it is most closely connected.

The text of the order is available here.

On these topics, the readers of RDIPP may refer to:

Fausto Pocar, 1991, No 2, 249 ff.;
Bertrand Ancel, 1991, No 2, 263 ff.;
Ilaria Queirolo, 1997, No 3, 601 ff.;
Roberta Clerici, 1997, No 4, 873 ff.;
Gianluca Contaldi, 1998, No 1, 79 ff.;
Jacopo Re, 2010, No 2, 407 ff.;
Marco Lopez de Gozalo, Andrea La Mattina, 2012, No 1, 87 ff.;
Francesca C. Villata, 2015, No 4, 973 ff.;
Gaetano Vitellino, 2019, No 4, 999 ff.

Moreover, see, in our Book Series:

Ilaria Queirolo, Book No 51;
Francesca C. Villata, Book No 77.