Transnational Litigation and Elements of Fair Trial

Si tratta della relazione generale tenuta al XIV Congresso mondiale dell'Associazione internazionale di diritto processuale (IAPL), tenutosi presso l'Università di Heidelberg nel 2011. Abstract I. The regulation of transnational litigation is not worlds apart from civil procedural law. Transnational litigation does not seek to achieve any special or particular form of justice. The problem is to balance access to the courts and effective protection of individual rights with the right to be heard. Indeed, these are “eternal” problems of civil procedure. II. The Report points out from the outset the distinction between substantive law and procedural law. It represents a crucial point in the regulation of transnational litigation before national courts. The distinction between substantive law and procedural law has fostered the view that procedural law is “neutral” as regards substantive law. Therefore any procedural law could implement any substantive law. As a result of this idea one might have expected that the choice of law would have played a leading role in transnational litigation. On the contrary, quite the opposite is true. The daily practice of the courts is dominated by rules of jurisdiction as well as international civil procedure. This is a result of the strong differences among national procedural systems, in particular between the U.S. system and the rest of the world. III. Public policy goals to be achieved by the regulation of the judicial process are more usual in transnational litigation than in domestic disputes. The Report refers to a number of critical situations, in which overstating public policy concerns can affect the balance between plaintiff’s and defendant’s interests. The first situation stems from the link between the exercise of judicial jurisdiction and sovereignty. E.g., the English transient-service jurisdiction and the French citizenship jurisdiction completely disregard the consideration of fairness in relation to the defendant. The second critical situation concerns the transnational service of process. According to widespread opinion in the civil law systems, service of process is an act of sovereignty. Thus, the State interest in having control over its territorial sovereignty plays a role in the service of process upon a defendant, who is resident there. However, this idea can be misleading. It is doubtful whether perceiving service as an act of sovereignty can really protect defendants. On the contrary, due to the fact that it could lead the Forum State to use an intra-State fictitious service of process, like the remise au parquet, it could in fact prejudice their situation. The third critical situation where public policy intervenes in the assessment of transnational civil proceedings can be related to the good functioning of the internal market, which represents a crucial public policy goal of the European Union. The interest of the European Union in enhancing the functioning of the internal market has led to a remarkable simplification of the enforcement of judgments in favour of the plaintiff. Questions may be raised as to whether this regulation is in itself harmful to the notion of a fair trial by penalising the defendant. However the answer must depend on where the proceedings in fact take place. Conditions relating to the administration of justice differ according to the Member State in question and the principle of “mutual trust” amounts to little more than a rhetorical slogan. IV. Generally speaking, the regulation of transnational disputes must first and foremost seek to balance the plaintiff’s interests (access to the court, effective protection of asserted rights) and the defendant’s interests (right to be heard). Public policy concerns should normally play only a subordinate role in two-party litigation, both domestic and transnational. Public policy concerns should not affect the balance between the interests of plaintiffs and defendants. This is true for both the interest of the State in exercising its jurisdiction to adjudicate and any interest the State may have in maintaining control over its territory (territorial sovereignty), as well as for the European Union policies referring to the “sound operation” of the internal market. Normally, public concerns can intervene in favour of either party in the dispute. Thus, the Forum State interest in exercising its jurisdiction to adjudicate is normally exercised in favour of the plaintiff whereas the sovereign interests of the State in avoiding (or limiting to certain means) cross-border discovery or service of foreign process on its own territory favours the defendant who is resident there. When assessing the relationship between parties’ interests and public concerns, one should observe the following guideline. If the interest of a polity is on the side of one party (either the plaintiff or the defendant), such a situation should not be detrimental to the “essence” (Wesensgehalt) of the fair trial guarantee and thereby damaging the counterparty. In other words, the regulation of transnational litigation as well as the regulation of domestic litigation should focus on the balance between the parties’ interests. Little room should be given to considerations of public interest or of public policy which are not related to either the private interest of parties or to the needs of justice. Of course, public policy issues should play a major role in our globalised world. However, it is primarily the political system that should be entrusted with the task of governing globalisation and the regulation of transnational litigation has a limited role to play in this context. From the perspective of advancing the public interest, the regulation of transnational litigation has a specific and limited yet important task. It is the task of making the system of civil justice more competitive vis-à-vis arbitration. In this regard legal scholarship has made an important contribution: the joint project between the American Law Institute and the Unidroit on the Principles of Transnational Civil Procedure. It has been carried out by lawyers and scholars belonging to different procedural law traditions and cultures. The result is of great value due to the balanced approach of the proposed solutions. A set of principles have been identified that should be considered as a common set of requirements for guaranteeing a fair trial in transnational litigation. They should be not only a point of reference in the scientific debate on this issue but also a model for legislators. Moreover, they should serve as interpretative guidance for judges dealing with transnational litigation. Finally, they could be used as a kind of benchmark against which national and regional norms can be compared. A second major contribution towards enhancing international litigation before national courts is the Convention on Choice of Court Agreements (2005), drawn up under the auspices of the Hague Conference on Private International Law. The objective of the 2005 Convention is to outline uniform rules for the enforcement of exclusive choice of court agreements between parties to commercial transactions and to facilitate the recognition and enforcement (in the contracting States) of decisions of courts whose jurisdiction is based on such agreements. This topic provides an excellent example of the current tension between the rights (and autonomy) of private parties and public policies, not only in the field of transnational litigation but also in the civil procedure more generally. If we agree on the purpose of restoring the competitiveness of state civil justice vis-à-vis arbitration, the path to take is to extend the degree of negotiability of procedural rules, and determine what exactly we consider to be non-negotiable. V. In order to remove some regulatory deficiencies of civil law systems, and particularly of the European Union civil justice system, the U.S. approach and the central role played by the constitutional due process guarantee in shaping fundamental aspects of transnational litigation, should be considered as a good model. This view is by no means new, but it is worth repeating and adapting it to present circumstances. The new legal framework introduced in the European Union law by the Lisbon Treaty makes this proposal more acceptable and more practicable than it was twenty years ago. The European Union now recognizes the rights, freedoms and principles set out in the Charter of Fundamental Rights of the European Union, which shall have the same legal value as the Treaties. In other words, the Charter has become a legally binding instrument of primary EU law. Among the rights set out in the Charter, there is the right to an effective remedy and to a fair trial. Art. 47 Ch. largely corresponds to Art. 6 and Art. 13 ECHR. The Lisbon Treaty also provides for the accession of the EU to the ECHR. The European Court of Justice, through long-standing caselaw has affirmed the role of the Convention in the operation of EU law. According to Art. 52(3) Ch., in so far as the Charter contains rights which correspond to the rights guaranteed by the ECHR, the meaning and scope of these rights shall be the same as those laid down by the Convention. Moreover, it is worth mentioning that Art 6(3) TEU also makes reference to the Convention. It provides that fundamental rights, as guaranteed by the Convention and as they result from the constitutional traditions common to the Member States, shall constitute general principles of the EU law. The fairness-based approach is common to both the U.S. legal system and civil law systems. In the continental legal tradition, the pre-determined rules of jurisdiction are also determined on the basis of considerations of proximity and fairness. Adjudicatory authority has never been based solely on the fact that a person is to be found within the territory of a State court. Rules conferring jurisdiction are drafted in a general, abstract manner. The underlying view has always been that the established jurisdiction is fair to both the parties. Nevertheless, this general-abstract approach may fail in particular circumstances. This is a more general point and applies not only with regard to the rules of jurisdiction. Pre-established rules enhance the certainty and predictability of the law, but they are drafted in relation to the usual course of events. Fair results in applying the law rely both on pre-established rules and on standard situations in which the rules are to be applied. However in exceptional circumstances the application of pre-fixed rules may lead to unfair, even inequitable, outcomes. In such a context there is room for constitutional considerations, through the application of the fair trial guarantee by the courts. In civil law systems, it is not necessary to set aside the general, abstract approach. The fair trial guarantee may be invoked to invalidate particular misconceived pieces of legislation or to restrict their scope of application. It is worth noting that civil law courts are not alone in performing such operations. Judges in every country are more and more aware of belonging to a developing global community. The emergence of such a community of courts may achieve a number of goals in this respect: a cross-fertilization of legal cultures in general, but also solutions to some specific legal problems related to transnational disputes in particular. The Report gives some examples of inconsistencies of civil law systems that can be eliminated by applying the fair trial guarantee. The first example is related to the lis alibi pendens exception. If the problem of lis alibi pendens and parallel proceedings is resolved on the basis of the continental European priority rule, it may well happen that a court is seised first by, e. g., instituting a proceedings for negative declaration (or relief), with a view to prevent litigation before the second seised court. In such situations, to avoid abusive litigation, the fair trial guarantee de lege lata may allow the second seised court to retain its jurisdictional powers and to go further with its proceedings, if it appears that the dispute will not be fairly and effectively resolved by the first seised court. The second example is related to the forum non conveniens doctrine. In cases where it is absolutely inappropriate for the court vested with jurisdiction to handle proceedings with foreign parties, e.g. because the court and the lawyer are completely ignorant of the foreign language and reliable translators are not available, the fair trial guarantee de lege lata may exceptionally allow the court to decline its jurisdiction, applying the doctrine of forum non conveniens. In the light of the U.S. due process guarantee we can look at one of the most critical aspects related to the recognition and enforcement of judgments under the Brussels Convention and Regulation no 44/2001. Subject to few exceptions, the jurisdiction of the court of the Member State of origin may not be reviewed by the court seised with the enforcement request in other Member States. The public policy defence may not be applied to the rules related to jurisdiction. The European solution is an example of the disproportionate influence of public policy considerations (in this case: the smooth functioning of the internal market) with regard to the balance between the plaintiff’s and the defendant’s interests. In other words, if the fairness of the exercise of jurisdiction over a non-resident defendant is an element of fair trial, the respect for this fairness, as is envisaged by the Convention and the EC Regulation no. 44/2001 norms on jurisdiction, should also be reviewed in the State where the recognition and enforcement is sought, through the public policy defence. It is true that the public policy exception is an “emergency brake” to be activated only in exceptional cases, but these cases cannot be restricted so as to prejudice the guarantee of a fair trial. National courts should be encouraged to take the opportunity to put a preliminary question before the ECJ, under Art. 267, TFEU, on the validity of Art. 28, III, Convention (Art. 35, III, EC Regulation no 44/2001) vis-a-vis Art. 47 of the Charter of Fundamental Rights of the European Union. VI. The final part of the report briefly sketches some specific aspects of the fair trial guarantee in transnational disputes, such as the principle of equality, the determination of the judicial jurisdiction, the interim protection of rights, the right to engage a lawyer, the language, the extension of time limits, the question of the abuse of process, the abuse of jurisdiction by the plaintiff, the public policy exception.