Thu, Oct. 06, 2005

Court Expands Jurisdiction

.   Today, the Cologne Circuit published a press release in the matter 16 U 36/04 explaining its ruling on an interlocutory appeal dated September 12, 2005. The court expands the jurisdiction of German courts and possibly other European courts by permitting domestic parties to sue economically more advantaged foreign parties, such as insurance carriers, domestically.

The dispute involves a car driver's insurance claim against the insurer of a vehicle after an accident outside of Germany. The plaintiff sued the foreign insurer in Germany, and the local court dismissed the complaint for lack of international jurisdiction.

On appeal, the Cologne Court of Appeals construed the EU directive of December 22, 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters to mean that the legislator intended to confer international jurisdiction over a foreign insurer in automobile accident matters and to permit the victim to sue a foreign insurer domestically.

The court found additional support in a guideline of May 2005 which it read to strengthen the position of consumers against insurers. The decision is not final. It runs counter to the majority of interpretations of the jurisdictional rules in Germany and may be limited to European defendants.

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