The High Court has set aside service of a plenary summons and struck out proceedings brought by Leinster Stone Supplies Limited against Italian machinery supplier OMAG SpA. The court ruled that the parties’ contract required the dispute to be heard in Italy.
The judgment, delivered by Ms Justice Creedon on 20 February 2018, concerned a motion by OMAG challenging the Irish court’s jurisdiction under Article 25 of the Brussels I Regulation. The underlying claim remains unadjudicated: the court did not determine whether the machine was defective or whether OMAG was liable for the losses alleged.
Under a written contract dated 24 December 2014, Leinster Stone agreed to buy a Mill 4X CNC machine from OMAG for €145,500 plus VAT. The judgment says the machine was to cut and polish stone in Leinster Stone’s business. After difficulties with the machine, it was replaced on 12 September 2015, 28 weeks later. Leinster Stone’s plenary claim sought damages for alleged breach of contract, breach of warranty, negligence and breach of duty, including statutory duty.
OMAG relied on a contract term headed “Competent court”, which provided that if the parties could not agree on a court for disputes over the “interpretation or execution” of the sales conditions, the competent court would be in Bergamo, Italy. OMAG argued the clause was exclusive and covered the claims because they concerned its performance of contractual obligations.
Leinster Stone submitted that the clause should be read narrowly and did not cover its claims. It argued that Ireland was the place of performance and the appropriate forum. The court also considered evidence from an Italian lawyer concerning provisions of Italian law and the clause’s enforceability. OMAG disputed the relevance of those provisions to the jurisdiction clause.
The judge found that a reasonable commercial entity would understand “execution” to include matters concerning OMAG’s performance of its contractual obligations. She concluded that the clause applied to the claim and that related contractual and tort claims should not be split between jurisdictions. The court was also satisfied that the requirements of Article 25 had been met and noted that the parties’ dispute was to be decided under Italian law, as provided in the contract.
The court concluded that Italy was the appropriate jurisdiction and that it had no jurisdiction to determine Leinster Stone’s claim. It ordered service of the plenary summons set aside and the proceedings struck out. The judgment records no ruling on the merits of the underlying allegations.