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CHAPTER 1
AUSTRIA
Dr Susanne Fruhstorfer and Dr Felix Klement
Weiss - Tessbach Rechtsanwälte - OEG, Rotenturmstraβe 13, Aâ1010 Wien, Austria
1. GENERAL GROUNDS ON WHICH COURTS WILL ACCEPT JURISDICTION
Introduction: international jurisdiction
Until 1 January 1998 it was comparatively difficult to determine if Austrian international jurisdiction could be approved. There were relatively few statutes granting Austrian courts international jurisdiction and these statutes related only to matrimonial, paternity, property matters and the law concerning persons. In the absence of explicit statutes jurisdiction had to be accepted if Austria was bound to give jurisdiction under international law (e.g. under the Lugano Convention) or if the case brought before the court had âsufficient connection to the Austrian territoryâ (ausreichende Nahebeziehung zum Inland). In relation to sufficient domestic connection, the Austrian Supreme Court had developed an entire doctrine (Indikationentheorie), which was, however, rather vaguely worded and as a result the court decisions were hard to predict. With an amending law to the Austrian Act on Court Jurisdiction (Jurisdiktionsorm (JN)) which entered into force on 1 January 1998 this situation changed completely.
The Austrian legislature ruled that in each case in which local jurisdiction is applicable by law, Austrian international jurisdiction has to be approved (section 27a JN). Cases in which international law differs from these rules are the only exclusions. In practice that means that jurisdiction is always given if one of the places of jurisdiction mentioned below (items (a) to (i)) exists. In addition, the Supreme Court has to grant jurisdiction (section 28 JN) (even if there is no court of local jurisdiction) if:
(a) Austria is bound to give jurisdiction on the basis of a Convention under international law;
(b) the plaintiff is an Austrian citizen, domiciled in Austria, has his/her usual residence or place of business in Austria and the enforcement of rights abroad is impossible or cannot reasonably be acceptable;
(c) Austrian international jurisdiction, but not the jurisdiction of any specific Austrian court, was stipulated and is evidenced by documents (see below 1(g)).
If International jurisdiction is missing, courts have to dismiss the claim no matter at what stage proceedings are and declare the foregoing proceedings null and void. According to section 42 para. 2 JN even a final and conclusive judgment can be cancelled by the Supreme Court upon application by the highest administrative authorities if it turns out that Austrian courts did not have jurisdiction.
(a) Domicile
The place of general jurisdiction is determined by the domicile of the defendant (section 66 JN). Domicile (âWohnsitzâ) is the place where a person settles down with the intention to choose it as his/her permanent residence. The general jurisdiction of a physical person is also established by his/her usual residence, which is determined simply by the fact of a continuing residence at a certain place. If a person has his/her domicile and usual residence in the districts of different courts, the plaintiff is free to choose the court at which an action is filed.
Persons who have no domicile or usual residence in Austria or anywhere else in the world may be sued at the court competent for their current place of residence.
Persons who have no current residence in Austria or of whom such current residence is unknown may be sued before the court competent for their last place of domicile or residence in Austria in connection with any liabilities which arose during their stay in Austria or are to be fulfilled in Austria (section 67 JN).
(b) Place of business/office
The general place of jurisdiction of legal entities (limited liability companies, stock corporations, associations, etc.) or other legal personalities which are not legal entities, such as limited partnerships, is determined by their principal place of business (section 75 JN). In case of doubt, the principal place of business is deemed to be the place of administration of the legal entity/legal personality.
Physical persons and legal entities (legal personalities) which entertain a business establishment at a place other than their principal place of business may also be sued at the court competent for the place of the business establishment if the dispute concerns business activities of the branch office (section 87 JNâelective venue).
(c) Assets located within the jurisdiction
Actions based on a property claim against physical persons or legal entities/personalities without a general place of jurisdiction in Austria (domicile, permanent residence, principal place of business, compare items 1 (a) and 1 (b) above) can be brought before the court of the district in which assets of the defendant or the object in dispute are located (section 99 JN).
If the assets in question are claims, the domicile or the usual place of residence of the defendantâs debtor is considered the place at which the assets are located.
The value of the assets must not be disproportionately smaller than the amount in dispute. The Supreme Court ruled that assets equalling one third of the amount in dispute may give reason for jurisdictionâassets in the amount of one sixth may not.
It is also to be noted that the jurisdiction of the assetsâ location does not apply vis-Ă -vis persons domiciled in a Contracting State of the Lugano Convention (see item 1 (f) below) as such venue is deemed an âexorbitantâ venue.
(d) Forum actus in tort cases
Action concerning damages caused by homicide, injury to persons, deprivation of liberty or damage to physical objects can be brought before the court of the place where the event causing the damage occurred (forum actus in tort cases, section 92a JN).
(e) Contract governed by local law
The fact that a contract is subject to Austrian lawâwhether on the basis of an agreement by the parties on the choice of law or pursuant to the provisions of Austrian Conflict Rules (Internationales Privatrecht)âdoes not automatically provide for Austrian courts to have jurisdiction. Austrian courts are competent for claims arising out of contracts governed by Austrian law only if also other facts give rise to the applicability of such jurisdiction.
The place of performance of a contractual obligation is basically irrelevant for the question of jurisdiction; only if the parties involved explicitly agree on such place of performance and if documentary evidence can be produced to prove this agreement, may actions relating to the existence or non-existence of a contract, to the fulfilment or rescission of a contract and to compensation claims owing to non-fulfilment be filed with the court competent for the place of performance (section 88 I. JN).
Among persons/entities who conduct a commercial enterprise, the competence of a certain court is also determined by accepting an invoice transmitted together with or even before the respective goods if such invoice states that payment is to be effected at a certain place and that actions may be brought before the competent court of that very place. If such reference or the invoice in general is rejected as not being in compliance with the agreement or if the invoice is returned without comment or the delivery to which the invoice relates is refused as not having been ordered, no âjurisdiction of the place of invoiceâ is constituted (section 88 II. JN). Such jurisdiction will in any case only apply to claims arising in connection with the delivery of movable goods; it is not applicable for claims in connection with a contract for work done and materials supplied.
(f) Conventions
The Convention on Jurisdiction and Enforcement of Judgments in Civil and Commercial Matters concluded at Lugano on 16 September 1988 (Lugano Convention) entered into force in Austria on 1 September 1996. Apart from this multilateral convention (which will be addressed in more detail below), Austria has ratified the following multilateral conventions relating to the jurisdiction of the contracting parties:
â Convention on the Contract for the International Carriage of Goods by Road (CMR);
â Convention for International Railroad Traffic (COTIF);
â Convention for the Unification of certain rules relating to International Carriage by Air (WA);
In addition, Austria has concluded bilateral treaties on acknowledgment and enforcement, which partly also relate to international jurisdiction, with the following states: Belgium, Germany, Finland, France, United Kingdom of Great Britain and Northern Ireland, Israel, Italy, Liechtenstein, Luxembourg, Netherlands, Norway, Sweden, Switzerland, Spain, Tunisia, Turkey.
In the relationship with Contracting States of the Lugano Convention, these treaties are replaced by the Lugano Convention in the areas covered by it (civil and commercial matters).
Lugano Convention
The provisions on jurisdiction stipulated by the Lugano Convention prevail over the respective Austrian provisions if the defendant has his/her domicile within the territory of a Contracting State.
As already mentioned in item 1 (c) above, the âjurisdiction of the place where the assets are locatedâ (section 99 JN) does not apply vis-Ă -vis persons who are domiciled within the territory of a Contracting State of the Lugano Convention.
In the following, only the main differences between the provisions on jurisdiction as stipulated by the Lugano Convention on the one hand and by Austrian law on the other will be discussed.
Pursuant to Article 5(1) of the Lugano Convention, persons having their domicile within the territory of a Contracting State may be sued in Austria if the place of performance of a contract is located in Austria, irrespective of the place of performance being explicitly agreed in the contract or not or determined by the rules of the law applicable to the contract. Pursuant to section 88 JN (cf. item 1(e)) an action may be filed with the competent court of the place of performance only if the parties to the respective contract have agreed on such place of performance in writing and if documentary evidence can be produced. The place of performance determined merely by the law applicable to the contract does not constitute jurisdiction.
Whereas section 92a JN stipulates that in matters relating to tort only such courts have jurisdiction which are competent for the place where the act causing the damage was committed, Article 5(3) of the Lugano Convention provides that an action may also be brought before the court competent for the place where the actual damage occurred.
The Austrian legal provisions on jurisdiction are extended by the provisions of the Lugano Convention relating to insurance and consumer contracts (sections 3 and 4), which stipulate that insurers or entrepreneurs may be sued by policy-holders and consumers respectively also before the court competent for the domicile of the latter. Sections 3 and 4 of the Lugano Convention thereby introduced the almost unknown concept of the âjurisdiction of the plaintiffâs domicileâ into Austrian law.
The exclusive jurisdictions contained in Article 16 of the Lugano Convention more or less correspond to those stipulated in the JN (cf. item 1(h)).
The Lugano Convention allows the prorogation of jurisdiction to settle any disputes which have arisen or may arise in connection with a particular legal relationship, provided one of the parties is domiciled in a Contracting State. The agreement has to be either in writing or evidenced in writing, or in a form which is in accordance with the established practices of the parties or any other form according with a usage of trade (Article 17). According to section 104 JN, however, a prorogation always has to be in writing or evidenced in writing (cf. below item 1(g)).
(g) Clause attributing jurisdiction
Parties can agree that one or more courts of first instance competent for certain places as indicated in such agreement are to have jurisdiction to settle any dispute which has arisen or which may arise in connection with a particular legal relationship. Such agreement must be evidenced by document (section 104 JN). As far as complaints against consumers (based on a consumer contract) are concerned, only a prorogation in favour of the court of the place of domicile, permanent residence or employment of the consumer is valid (section 14 of the Austrian Consumer Protection Act). In addition, any agreement which ...
