The Gazette 1994

GAZETTE

APRIL 1994

the case of the claims based on different obligations arising under a contract of employment as a representative binding a worker to an undertaking is the obligation which characterises the contract." 12 Place of Performance The Court of Justice ruled in Tessili v Dunlop that "the 'place of performance of the obligation in question' . . . is to be determined in accordance with the law which governs the obligation in question according to the rules of conflict of laws of the court before which the matter is brought." 14 The Mulox case raised the issue whether an exception similar to that made in Ivenel v Schwab should be made, on the basis of independent criteria to be formulated by the Court of Justice, as regards the 'place of performance' in relation to an employment agreement. domiciled at Aix-les-Bains, France, was employed by Mulox, domiciled in England, as its director of international marketing with effect from 1 November 1988. He set up office at his home in Aix-les-Bains and was devoted to the canvassing of customers and the establishment of a distribution system for Mulox products in Belgium, Germany, the Netherlands and Scandinavia, where he travelled frequently. French territory was excluded from his area of responsibility until September 1989. From 1 January 1990, Geels worked with Mulox agents in France and serviced French Mulox customers. In May 1990, Mulox informed Geels that the fruits of his efforts were not in proportion to costs which had been incurred and, accordingly, it had decided to terminate his employment and offered him a gross termination payment of 7 1/3 months salary. Following the termination of his employment, Geels sought a year's salary in lieu of notice and general damages before the Conseil de Facts and issues Geels, a Netherlands national

prud'hommes d'Aix-les-Bains. That court based its jurisdiction on Article 5, 1., applied French law and awarded Geels compensation, ruling largely in his favour. Mulox appealed to the Cour d'appel de Chambéry claiming that the French courts lacked jurisdiction, as the employment contract was not restricted to France, rather it applied to the whole of Europe and Mulox had its place of business in the UK. Further, under English law which it claimed the parties had chosen to be applicable to the contract and which was indicated by the Rome Convention as the law of the employer's place of establishment, Geels was entitled to no compensation. In the alternative, Geel's claims were unfounded under French law. The court referred to the decision in Ivenel v Schwab, noting that the Court of Justice considered it preferable that such disputes were heard before the courts of the State whose law was applicable to the contract. Article 6, 2., (b) of the Rome Convention indicates as the applicable law

court seised of the dispute, or does it suffice for its application that one part, perhaps the main part, of the obligation has been carried-out on the territory of that State?" (translation by the author)

Opinion of the Advocate General

In his exceptionally diaphanous opinion, dated 26 May 1993, Advocate General Jacobs stated that the place of the business through which the employee was engaged had been clearly rejected as a basis of jurisdiction in the Six 1 * case as being unfair to the employee. The 1989 Convention amendment to Article 5, 1. took account of this decision: 16 "in matters relating to individual contracts of employment, this place is that where the employee habitually carries out his work, or if the employee does not habitually carry out his work in any one country, the employer may also be sued in the courts for the place where the business which engaged the employee was or is now situated." Turning to the Rome Convention, he pointed out that although the French court regarded the Convention as applicable to the contract between Mulox and Geels, the contract had obviously been concluded before 1 April 1991 on which day the Convention entered into force in both France and the UK. Article 17 of the Rome Convention provides "This Convention shall only apply in a Contracting State to contracts made after the date on which this Convention has entered into force with respect to that State."

"b) if the employee does not

habitually carry out his work in any one country, by the law of the country in which the place of business through which he was engaged is situated;"

There was nothing to suggest that the parties had chosen French law to be applicable to the contract. If English law was applicable (which it thought probable), should Article 5, 1. of the Convention, on the basis of the Ivenel decision, be interpreted as giving jurisdiction to the English courts and not to the French courts? The court stayed its proceedings and referred the following question to the Court of Justice for a preliminary ruling. "Does the ground of jurisdiction laid down by Article 5, 1. of the Convention require that the obligation which characterises an employment contract was

'Place of performance' - national or autonomous interpretation ?

Advocate General Jacobs stated

"But the grounds given by the Court in Tessili v Dunlop . . . do not seem nearly so compelling in relation to a contract of employment, especially if the relevant obligation is the obligation to perform work . . .

performed wholly on the sole territory of the State which establishes the jurisdiction of the

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