CJEU decides on jurisdiction in package travel case

Michael Wukoschitz's picture

The plaintiffs, domiciled in Bludesch (Austria), booked and paid for themselves, as private individuals, a package holiday to Egypt on the website of a German online travel agent. The OTA, a company whose registered office is in Munich (Germany), stated that it acted as the travel agent and that the trip would be operated by a particular our operator, which has its registered office in Vienna (Austria).

Due to a mistake either of the OTA or the tour operator or due to a technical problem, the hotel reservation for the plaintiffs was made with a different hotel than they had wanted to book. As the names of the two hotels were very similar, the plaintiffs didn't notice the difference in the booking confirmation but only upon arrival in Hurghada noticed the mistake concerning the hotel and paid a surcharge of EUR 1 036 to be able to stay in the hotel initially booked.

In order to recover the surcharge paid and to be compensated for the inconvenience which affected their holiday, the applicants in the main proceedings brought an action before the Bezirksgericht Bludenz (comptetent court for thier place of domicile) seeking payment from the OTA and the tour operator, jointly and severally.

The court dismissed the action in as far as it was brought against the tour operator on the ground that it lacked local jurisdiction. According to that court, Regulation No 44/2001 was not applicable to the dispute between the applicants in the main proceedings and the tour opeator as the situation was purely domestic. However, that court held that, as regards the OTA, since that company has its registered office in Germany the condition laid down in Article 15(1)(c) of Regulation No 44/2001 concerning the activity directed to Austria was fulfilled. Therefore, it held that it had jurisdiction to hear the substantive proceedings.

The plaintiffs filed an appeal, claiming that the booking they made was from the outset inseparably linked, as a uniform legal transaction, with the OTA and with the tour operator. Since a package holiday was involved, a combined reading of Articles 15(3) and 16(1) of Regulation No 44/2001 constituted the legal basis for the jurisdiction of the court seised, which also applied with respect to the tour opeartor.

The appelate court lodged a reference for prelimary ruling to the CJEU asking the latter whether a situation, such as that at issue in the main proceedings, is a ‘purely domestic situation’ and, in that respect, how the concept of ‘the other party to a contract’ laid down in Article 16(1) of Regulation No 44/2001 is to be interpreted, in a situation in which a person who pursues commercial or professional activities, in a Member State other than that in which the consumer is domiciled, markets the services of another person who pursues commercial or professional activities, whose registered office is situated in the latter State, where a consumer brings an action against that ‘other party’, since that provision enables him to assert his right before the courts of the place of his domicile.

In its judgement of Nov. 14, 2013, the Court of Justice of the European Union held that the concept of ‘other party to the contract’ laid down in Article 16(1) of Regulation No 44/2001 must be interpreted as meaning, in circumstances such as those at issue in the main proceedings, that it also covers the contracting partner of the operator with which the consumer concluded that contract and which has its registered office in the Member State in which the consumer is domiciled.

According to the CJEU, that though for the Regulation to apply the existence of an international element is required, the international nature of the legal relationship at issue need not necessarily derive from the involvement, either because of the subject-matter of the proceedings or the respective domiciles of the parties, of a number of Contracting States. Even assuming that a single transaction, such as the one which led the plaintiffs to book and pay for their package holiday on the OTA's website, may be divided into two separate contractual relationships, first, with the OTA and, second, with the tour operator, the second contractual relationship cannot be classified as ‘purely’ domestic since it was inseparably linked to the first contractual relationship which was made through the travel agency situated in another Member State. The CJEU also referred to the objectives set out in recitals 13 and 15 in the preamble to Regulation No 44/2001 concerning the protection of the consumer as ‘the weaker party’ to the contract and the aim to ‘minimise the possibility of concurrent proceedings … to ensure that irreconcilable judgments will not be given in two Member States’.

Full text fo CJEU judgement of Nov. 14, 2013 in case C‑478/12 - Maletic and Maletic/lastminute.com and TUI Österrereich available here>>.

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