In the recent case of Mauritius Commercial Bank Ltd v Hestia Holdings Ltd and Another [2013] EWHC 1328 (Comm), the English Commercial Court confirmed that one-way or unilateral jurisdiction clauses (in which one party can bring proceedings in one jurisdiction only, whilst the other has the option to bring proceedings in other jurisdictions) are valid under English law. In so doing, the Commercial Court has not followed the approach of the French Cour de cassation in Mme X v Bank Privée Edmond de Rothschild (the “Mme X Case“), in which a one-way jurisdiction clause was found to violate Article 23 of the Brussels Regulation because of its potestative nature (a potestative condition being one whose satisfaction is completely within the power of one of the parties, with no mutuality of obligation). The treatment of unilateral jurisdiction and arbitration clauses was discussed in our previous post.
The Mme X Case caused concern amongst many commercial parties, in particular financial institutions which favour such clauses. Whilst such unilateral jurisdiction clauses may not be upheld in all jurisdictions, it is some comfort that, in a robust judgment, the Commercial Court upheld the jurisdiction clause and, obiter, concluded that even more one-sided clauses than the one before it would not violate the public policy of equal access to justice enshrined in Article 6 of the European Convention on Human Rights.
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