TRW Ltd v Panasonic Industry Europe GmbH
| Jurisdiction | England & Wales |
| Judge | Mr Justice Kerr |
| Judgment Date | 08 January 2021 |
| Neutral Citation | [2021] EWHC 19 (TCC) |
| Court | Queen's Bench Division (Technology and Construction Court) |
| Docket Number | Case No: HT-2020-000027 |
[2021] EWHC 19 (TCC)
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS
OF ENGLAND AND WALES
TECHNOLOGY AND CONSTRUCTION COURT (QBD)
Rolls Building
Fetter Lane,
London, EC4Y 1NL
Mr Justice Kerr
Case No: HT-2020-000027
Mr David Caplan (instructed by Oury Clark Solicitors) for the Claimant
Mr Andrew Legg (instructed by McDermott Will & Emery UK LLP) for the Defendants
Hearing date: 15 December 2020
Approved Judgment
I direct that no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
Introduction
The defendants (where appropriate, collectively Panasonic) make, among other things, resistors used in vehicle parts. One of their customers is the claimant ( TRW), now called ZF Automotive UK Limited. TRW is a supplier of parking brakes and electronic stability control assemblies in the automotive industry. TRW's parts include resistors made by Panasonic.
In January 2020, TRW sued the defendants, alleging that certain resistors supplied by Panasonic from 2015 to 2017 were defective. The defendants applied in March 2020 to set aside service and for a declaration that the English court has no jurisdiction over the claim or, alternatively, for a stay of the action. The defendants rely on provisions in the recast Brussels I Regulation (Regulation (EU) No 1215/2012) ( the Recast Brussels Regulation).
The defendant Panasonic companies are based in Germany. Panasonic's Group headquarters are in Japan. It has subsidiaries in many countries. TRW is the English subsidiary, based in Solihull, of a German group of companies, ZF Group. The defendants say the parties agreed to German law and exclusive jurisdiction of the Hamburg court over any claim by TRW arising from supply of the resistors. TRW says the parties agreed to English law and jurisdiction.
Alternatively, the defendants submit that if the English court does have jurisdiction, I should stay the claim in the exercise of my discretion to avoid the risk of irreconcilable judgments because there are related proceedings in Michigan, USA, with judgment expected in about April 2021. TRW says a stay would be pointless because judgment in the Michigan proceedings will not determine the present proceedings, which are still at an early stage.
The resistors were supplied by the first defendant ( PIEU). There is an agreement that, it is alleged, may have transferred PIEU's liabilities to the second defendant ( PASE). That is why PASE has also been sued. But the parties agree that nothing turns on this possible transfer of liabilities and that it is not necessary to distinguish between the two defendants for the purpose of determining their present application.
The Facts
Panasonic companies have had commercial relations with TRW companies in Europe since at least 1998. Customers of PIEU are requested to sign a “customer file” document. TRW companies (now ZF Group companies) in Europe, including England, signed such documents from 1998 to 2019. There are copies of such documents relating to supplies by Panasonic to TRW companies in Italy, Poland, Czech Republic and within Germany, as well as to TRW in Birmingham and County Durham.
Mr David Jones of TRW signed a “customer file” document on 28 January 2011. It recorded payment terms and delivery conditions. Under the heading “Special Agreements”, there was a declaration agreeing to comply with relevant export laws and confirming that the customer does not produce or develop or sell weapons of mass destruction. The text then continued:
“The submission of this customer file and the handing over of the General Conditions do not automatically constitute a supply claim. We have received and acknowledged the General Conditions of [PIEU].”
The PIEU General Conditions provided as follows:
“1. Even if no reference is made to them in particular cases, the following terms and conditions shall apply exclusively to the entire business relation with us, particularly to all agreements for deliveries and services, unless different conditions, particularly conditions of purchase of the contracting party, have expressly been confirmed by us in writing.
Conditions of the buyer diverging from our terms and conditions shall not be valid even if we effected delivery or rendered services without reservation.
2. All offers are made without engagement. Contracts shall become effective on our written confirmation only. If delivery is carried out without the buyer having received such confirmation, the contract shall become valid by acceptance of delivery and subject to these conditions …..”
The PIEU General Conditions further provided at the end:
“12. For contracts with contractors for whom these general conditions apply, Hamburg is stipulated as place of performance and jurisdiction, also for action on a promissory note or cheque. Contracts concluded with us shall be governed by the law of the Federal Republic of Germany to the exclusion of the UN Sales Convention as amended at any time …. We also have the right to file a suit at the domicile of the buyer or one of his branches. Statutory jurisdiction applies otherwise.
Contracts concluded with us are subject to German law.
If any provision of these conditions shall be or become invalid in whole or in part, the validity of the other provisions shall remain unaffected. ….
The present conditions are written in different languages. In case of conflict the German version shall prevail.”
In February 2013, the parties discussed by email the supply of certain resistors, being or including the ones now alleged to be defective. This led to the placing of orders for those resistors as recorded in two “blanket order” documents ( the 2015 and 2016 purchase orders) dated 10 March 2015 and 25 January 2016.
The 2015 purchase order asked for the goods to be delivered “in accordance with [TRW's conditions of] purchase” ( the TRW Terms) and gave a website reference for where to find them. It went on to state:
“Commencement of any work or delivery of any goods or service under this order or delivery schedules or releases shall constitute your confirmation [that you] are aware of and accept such terms, conditions and requirements.”
Before turning to the 2016 purchase order, I should mention annual price negotiations that were being conducted during December 2015 and early January 2016. These were directed to agreeing prices for the calendar year 2016. They closed on 8 January 2016. They took place by emails and attachments between the US Panasonic company, Panasonic Industrial Devices Sales Company of America ( PIDSA) and representatives of the ZF Group.
The outcome of the negotiations was set out in a letter sent by ZF Group to PIDSA in December 2015, with a spreadsheet attached to it setting out the agreed prices for 2016 for each specific part. The parts list included the resistors at issue in these proceedings. Thus, they were priced according to the global negotiations that took place between the ZF Group and PIDSA. They covered deliveries of parts to factories in China, the USA, England and elsewhere.
The letter setting out the results of the price negotiations included reference to the TRW Terms, in the following paragraph numbered 4:
“Any Purchase Order issued by ZF TRW will be subject to (a) ZF TRW Automotive Global Supplier Quality Manual …. And (b) the TRW Automotive Terms and Conditions of Purchase (‘Terms’). The Supplier is responsible for accessing the VIN website for purposes of reviewing the latest version of the Terms …, and will immediately notify TRW in writing if it has any problems or is unable to access the VIN website.”
The 2016 purchase order, dated 25 January 2016, provided:
“This Order shall form a contract accepted by Seller based exclusively on, and limited to the terms of, this Order when Seller does any of the following: (i) begins performance under the Order; (ii) acknowledges the Order; or (iii) engages in any other conduct that recognizes the existence of a contract with respect to the subject matter of the Order. Buyer hereby objects to and rejects any proposal by Seller for additional or different terms. If Seller proposes additional or different terms, Seller's proposal will be deemed a material alteration of the terms of this Order, and the terms of this Order will be deemed accepted by Seller without Seller's additional or different terms. If the Order is deemed an acceptance of Seller's prior offer, Buyer's acceptance is expressly conditioned upon and limited to Seller's assent to the terms of this Order exclusively.”
The 2016 purchase order then repeated the wording of the 2015 purchase order: commencement of work or delivery of goods under the order “shall constitute your confirmation [that you] are aware of and accept such terms, conditions and requirements.”
The TRW Terms referred to in the two purchase orders were dated 1 November 2012. They were lengthy and detailed. Clause 32 provided:
“Governing Law: The Order will be governed by the laws of the state or country shown in Buyer's address on the Order, and the Convention on Contracts for the International Sale of Goods shall not apply. Buyer and Seller agree irrevocably to submit to the personal jurisdiction of the courts of the above-referenced location and waive all challenges to the personal jurisdiction of such courts for any and all claims arising out of or relating to the subject matter of the Order.”
PIEU was not asked...
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