A catwalk fight between lingerie purveyors has delivered
a lesson about enforcing exclusive jurisdiction clauses in
Simone Perele, Paris, and high end lingerie. Sounds like the
setting for a romantic novella, n'est-ce pas?
Not so when the key characters are fighting it out in the courts
of France and Victoria over the appropriate jurisdiction to hear
breach of contract claims, as in the recent case of Steadmark Pty
Ltd (t/a The Lingerie Company of Australia (LCA) v
Bogart Lingerie Limited (Bogart).
LCA is a subsidiary of the French lingerie house, Simone Perele.
Bogart is an Australian lingerie manufacturer. Bogart sued LCA in
Victoria to recover unpaid debts, and 10 months later Simone Perele
sued Bogart in the Nanterre Court in Paris over the quality of some
of its smalls.
The contracts between Simone Perele/LCA and Bogart said that the
Nanterre Court was 'solely competent to settle disputes'.
After Simone Perele started the Nanterre proceedings, LCA argued
that the Victorian proceedings should be stayed so that all
disputes could be heard in Nanterre
Had LCA submitted to the jurisdiction of Victoria?
Mais oui. The Victorian Supreme Court held that LCA had
submitted to the court's jurisdiction, and had waived its right
to rely on the contractual jurisdiction clause. Key to this were
that LCA had filed a counterclaim (instead of just defending the
claim) and successfully sought security for costs from Bogart.
LCA's 10 month delay in raising the jurisdiction clause also
The moral of the story? If you would prefer to defend a claim in
Paris and not Melbourne, consider your contractual rights early on.
Participating in even the early stages of litigation could be
enough to submit your dispute to that court's jurisdiction.
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We discuss whether certain clauses commonly found in ordinary commercial contracts could be considered to be penalties.
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