Kenburn Waste Management Ltd v Bergmann

For jurisdiction under Article 5(1) of the Brussels Convention, the court must identify the contractual obligation in question, determine the law governing that obligation, and then identify its place of performance under that law.

Under Article 4 of the Rome Convention, the characteristic-performance presumption may be disregarded where the circumstances as a whole show a closer connection with another country. The inquiry is comparative and gives proper weight to the connection identified by Article 4(2).

A negative contractual obligation may be performed in the country where the stipulated state of affairs is to be achieved. A jurisdiction challenge does not deprive the court of power to give procedural directions where the acknowledgement of service ceases to have effect.

Kenburn Waste Management Ltd, an English distributor, sued Heinz Bergmann, a German businessman, for breach of written undertakings not to communicate patent infringement threats to persons or companies in the United Kingdom.

Bergmann challenged the English court’s jurisdiction. Pumfrey J dismissed the challenge, holding that the governing law was English law and that the obligation was to be performed in the United Kingdom. He also held that the same result followed under German law. Kenburn appealed, and raised a respondent’s notice concerning expert evidence. The central issues concerned Articles 5(1) of the Brussels Convention and 4(1), (2) and (5) of the Rome Convention.

1. Appeal dismissed. The court upheld Pumfrey J’s dismissal of the jurisdiction challenge. The respondent’s notice concerning further German-law evidence was unnecessary to determine the appeal. No reference to the Court of Justice was required.
2. Article 5(1) required three questions: what was the obligation in question; what law governed it; and where was it to be performed. The obligation was the negative obligation not to make or allow communications to persons or companies in the United Kingdom. Communication imports both sending and receipt, so the substance of the obligation was directed to achieving a result in the United Kingdom.
3. Article 4(2) of the Rome Convention creates a presumption based on the habitual residence or principal place of business of the party effecting the characteristic performance. Under Article 4(5), that presumption must be disregarded where the circumstances as a whole show that the contract is more closely connected with another country. The exercise is comparative. The Article 4(2) connection is with a person, not with a place, but it remains a factor requiring proper weight.
4. The contract was more closely connected with the United Kingdom. Its objective was to prevent threats in the United Kingdom; it arose from Kenburn’s proposed English cause of action under section 70 of the Patents Act 1977; and it effectively compromised the proposed English proceedings. The United Kingdom therefore constituted the place of performance under English law.
5. The alternative analysis also supported jurisdiction. Even if German law governed, the place of performance could be deduced from the circumstances rather than defaulting to the obligor’s residence under section 269(1) of the German Civil Code.
6. The court distinguished Boss Group Ltd v Boss France SA because the negative obligation there was not directed to achieving a state of affairs in a particular country. The procedural objection based on CPR 11.1(7) also failed: the absence of an effective acknowledgement of service did not remove the judge’s power to give directions, including directions concerning a further acknowledgement.

Appeal dismissed with costs assessed at £25,000. Permission to appeal to the House of Lords refused.

• Court of Appeal (Civil Division): appeal from the order of Pumfrey J in the Chancery Division dated 11 May 2001. The appeal was dismissed and the jurisdiction challenge remained unsuccessful.