Jurisdiction and Conventional Derogation: Commentary on Judgment No. 15389/2024

The recent Order No. 15389 of June 3, 2024, issued by the Court of Cassation, offers important insights into jurisdiction and the possibility of conventional derogation in favor of a foreign judge. In an increasingly globalized context, the issue of jurisdiction becomes crucial, especially when parties involved in a dispute are located in different jurisdictions.

The Regulatory Framework

The judgment under review falls within the regulatory framework established by Law No. 218 of May 31, 1995, which governs civil jurisdiction in Italy. In particular, Article 3 of this law provides that Italian jurisdiction may be derogated in favor of a foreign judge, provided that such derogation is in writing and that the case does not concern inalienable rights.

In the specific case, the Court had to examine a situation where a defendant, residing in Italy, challenged Italian jurisdiction in favor of the Dubai Court, asserting the existence of an agency contract with a party based in the United Arab Emirates. The Court deemed this challenge admissible, emphasizing how the effect of the foreign forum selection clause binds the Italian judge to decline jurisdiction.

The Ruling's Headnote

Defendant Residing or Domiciled in Italy - Conventional Derogation in Favor of a Foreign Judge - Prior Challenge to Italian Jurisdiction - Admissibility - Effects of Derogation - Exclusivity of Foreign Forum - Conditions - Factual Circumstances The defendant residing or domiciled in Italy is permitted to challenge Italian jurisdiction based on a conventional derogation in favor of the jurisdiction of a foreign judge, provided that this is in writing and the case does not concern inalienable rights; under these conditions, the "negative" effect of the foreign judge selection clause binds the Italian judge seized to decline jurisdiction, without the possibility of evaluating the option expressed by the contracting parties. (In this case, the Supreme Court declared the jurisdiction of the Dubai Court, in response to the objection raised during opposition to a payment order by the Italian company, based on a written agency contract concluded with a contracting party based in the United Arab Emirates).

This headnote clearly highlights the importance of entering into contracts with well-defined forum selection clauses, as they can drastically influence the competent jurisdiction in case of disputes.

Conclusions

In conclusion, Judgment No. 15389 of 2024 by the Court of Cassation stands as an important precedent regarding jurisdiction and conventional derogation. It reiterates the necessity of formalizing such derogations in writing and clarifies that, in the absence of inalienable rights, the Italian judge is bound to respect the will expressed by the parties. This ruling not only underscores the importance of contractual clarity but also offers a useful reference for companies operating internationally, inviting them to carefully consider the legal implications of forum selection clauses in their commercial transactions.