The Supreme Court has dismissed Websense International Technology Limited’s appeal against a stay of its Irish debt recovery case against Italian company ITWAY SpA. It held that the Irish action was closely connected to earlier proceedings in Italy and should remain stayed under Article 28 of the EU jurisdiction regulation.
The judgment, delivered by Mr Justice John MacMenamin on 14 February 2014, affirms a High Court decision made on 6 November 2012. The High Court stayed the Irish proceedings until the Italian court decided whether to accept jurisdiction. The Supreme Court addressed only the stay under Article 28(1), not the separate question of setting aside service.
Websense International’s Irish summary proceedings seek €1,351,198.12 for unpaid invoices on products supplied for distribution in Greece, Italy and Turkey. The company said the distribution agreement gave Irish courts exclusive jurisdiction. ITWAY argued that the Irish claim was related to its Italian proceedings, begun on 22 March 2012, nearly a month before the Irish case was filed.
In Italy, ITWAY and associated companies allege that Websense companies directed sales through resellers Astel, Redco and Amelia, which failed to pay. They say the resulting losses led them to suspend payments to Websense. They also claim an October 2011 agreement changed payment arrangements and allege that Websense Italia later breached it by refusing to continue supplying them on credit. Those allegations were recounted in the judgment; the Supreme Court did not determine their merits.
The court said the cases arose from the same distribution agreement, involved overlapping issues and witnesses, and both required consideration of whether the agreement had been varied in October 2011. It concluded that hearing the actions together was expedient to reduce the risk of conflicting decisions.
The Irish jurisdiction clause did not allow the Irish court, which was second seized, to disregard the Italian proceedings. The Italian court must determine whether the clause gives it jurisdiction. The Supreme Court noted that Italy had deferred that question until a full hearing, meaning the Irish case could not progress unless and until the Italian court declined jurisdiction. It described that practical consequence as potentially unsatisfactory but said it was bound by the regulation and relevant EU case law.
The court dismissed the appeal and affirmed the stay. It did not decide the underlying invoice claim or the Italian claims.