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III. THE SIGNIFICANCE OF THE ARTICLE 5(1)(b) AND (c)
III-I. THE VIRTUE OF ARTICLE 5(1)(b) AND (c)
As noted in the introduction, the new words in Article 5(1)(b) and (c) in the Brussels 1 Regulation make a significant change for the old Article 5(1) of the Brussels Convention. It established a new system in simple sale of goods contracts and simple provision of services contracts that in these contracts, the place of performance of the characteristic obligation has jurisdiction. On the other hand, the old Article 5(1) Brussels Convention rule which focuses on the place of performance of the obligation relied on the plaintiff’s action is retained in Article 5(1)(a). To the situations, which the place of delivery of goods or provision of the services is outside a Member State, which party autonomy has intervened to specify the place of performance, which there are complex contracts involving more than just the provision of goods and services, and which the contracts do not involve the delivery of goods or the provision of services, according to Article 5(1)(c), Article 5(1)(a) of the general jurisdiction rule relating to contract applies.
Because most issues are raised by the contractual dispute, the establishment of this new system which separates the simply sale of goods contracts and simple provision of services contracts from other contract gives a more certain criterion on jurisdiction and solves the problem on jurisdiction of payment obligation in question.
III-II. SOME PROBLEMS REMAINING
There are some other problems, however, still need to be solved even though the new wording in Article 5(1) has given solutions to most of the issues. First of all, how to determine the jurisdiction in the case which the obligation in question is payment in a complex contract? Article 5(1)(b) could only be applied in simple delivery of goods contracts and simple provision of services contracts. Should the court have to turn to Article 5(1)(a) and use the obligation in question rule to decide the jurisdiction? Secondly, Article 5(1)(b) is interpreted in accordance with a characteristic obligation theory. However, if the delivery of goods or the provision of services is not the characteristic obligation, is it still appropriate to apply Article 5(1)(b)? In such instance, for example, the sale of goods contract involves designing, manufacturing and delivery. The principle obligation might be designing the goods whereas the place of delivery has jurisdiction according to Article 5(1)(b). How this case would be decided? There is another case on provision of services heard by the English Court of Appeal had the same problem. Finally, the new system established by Article 5(1)(b) raise the problem of classification of the dispute. Parties might argue if or not the case is in the scope of Article 5(1)(b) in a very early stage than focusing on the material divarication of the case.
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