Forum Running – Dispute of Competence

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In civil procedure law exists the principle that parallel ongoing proceedings must be avoided. For this purpose, civil procedure law awards a barrier effect towards a proceeding, that has been filed later elsewhere, but concerns the same matter. This will avoid two different rulings for the same matter. If a party is threatened by proceedings the party in question could be tempted to file a case in front of a court at its convenience, so called – forum running. If the plaintiff elects an obviously slow court its tactic is also referred as a torpedo lawsuit.

In the ruling 4A_446/2018 of the Federal Supreme Court of Switzerland the court had to evaluate a case of a possible abuse forum running. The background of this proceeding was a watch producer (plaintiff, domiciled in Switzerland) that decided to end the collaboration with a wholesaler (defendant, domiciled in Great Britain). The defendant requested the plaintiff to confirm the resumption of supply, the latest until the 6th of April. Otherwise, the defendant will file a lawsuit against the plaintiff in front of the courts at its domicile in Great Britain. Upon request of the plaintiff, the defendant extended its deadline until the 20th of April.

On the 19th of April the plaintiff filed a lawsuit against the defendant at the commercial court in Berne (Switzerland), at which time the defendant filed a lawsuit against the plaintiff in front of the High Court of Justice in London on the 29th of April 2016. Because of appeal, the parties reached the Federal Supreme Court of Switzerland that had to decide, whether the commercial court in Berne was competent or not. In front of the Federal Supreme Court of Switzerland the defendant claimed without success, that the plaintiff acted highly abusive when asking for more time and then filing a lawsuit one day before the deadline ends.

The federal court of Switzerland considered, that forum running is not abusive in general. The court summarized furthermore, that all the parties were already professionally represented the latest as of the 16th of March. In particular, to calculate and prepare for a possible forum running is basic task of an internationally proceeding lawyer. Therefore, the forum running was a risk, that the defendant had to be aware of since the very beginning of the dispute. 
The federal court of Switzerland overruled that the commercial court of Bern was competent to pass judgement in the matter.

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