It is not very common for a decision rendered by the French Supreme Court (Cour de cassation) to unleash reactions not only in France1 but also outside its borders.2 This is the fate experienced by the Rothschild ruling, upheld on 26 September 2012 by the First Civil Chamber of the Cour of cassation. We must begin by summarizing this decision as it relates to asymmetric clauses,3 before seeking its meaning and legal scope.

The choice-of-court clause in the heart of the Rothschild case was contained in a contract between a client, a French resident in Spain, and the Rothschild Bank, established in Luxembourg. This clause gave the Luxembourg courts exclusive jurisdiction, but allowed the bank to choose either the court of the client's residence, or 'any other competent court absent the aforementioned choice of court'. It was indeed an asymmetric clause, in that the client could only bring proceedings in Luxembourg, while other options were available to the bank.

In this case, the client, unhappy with the investments made, seized a French court, thus eliminating the clause requiring her to act in Luxembourg. But on three occasions, the pre-trial judge,4 the Paris Court of Appeal5 and finally the French Supreme Court upheld the competence of the court seized. Specifically, quoting the Cour de cassation, the clause was held to be contrary 'to the object and purpose of the prorogation of jurisdiction granted by Article 23 of the Brussels I Regulation'.6

What should we conclude from this French Supreme Court decision? Clearly, the Cour de cassation provided some care as to the reasons for its decision (although always brief as per the great French tradition) and wanted to give it some calibre, appealing in particular to the 'purpose of the prorogation of jurisdiction'. Such a general justification immediately sowed considerable concern in areas where the same type of asymmetric clauses is widely used. In the presentation that follows, several readings of the Rothschild judgment will be considered and lead to what, in the eyes of the author, is its clear rationale: ultimately, the Rothschild decision does not involve a new policy position; it is only indicative of judicial attitude in the interpretation of choice-of-court clauses.

1 Protecting the individual in dispute with a professional?

The client in the Rothschild case, for reasons unknown, could not take advantage of the consumer protection regime as laid out by the Brussels I Regulation, in its Articles 15 to 17.7 In particular, Article 17 of the Regulation could not protect her from a choice-of-court clause that treated her less well than the other party.8 It is thus possible to imagine that the French courts had come to her aid by repelling the clause nevertheless.

Such an analysis is of interest, since it would allow circumscribing the Rothschild case to relationships between consumers and professionals. Indeed, such a limitation is reflected in two Luxembourg judgments of 29 January 2014. To justify the asymmetric clause stipulated between professionals, the Luxembourg judges noted that the parties had an 'equal bargaining power'.9

However, after some thought, this consumerist understanding of the Rothschild judgment seems quite unlikely. It would be very hypocritical of the French Supreme Court to invoke a section of Brussels I Regulation, Article 23, to skirt around its Article 15, which sets the conditions for the application of the consumer protection regime. It is hard to believe that in the legal system of the European Union, where predictability is a cardinal virtue, the Cour de cassation may surreptitiously approve an extension of consumer protection, outside of the conditions laid down by the Union's private international law.

In fact it is really the content itself of the clause and not its context that displeased the French courts. But, consequently, if it is not by pure favour for the consumer that the Cour de cassation has ruled, it is impossible to confine the Rothschild judgment to relations between consumers and professionals.

2 Worshiping symmetric clauses?

The motto of the French Republic is famous: Liberté, Egalité, Fraternité. The French are often tempted to give priority to equality (Egalité) over freedom (Liberté). So, would it not be for reasons of equality that the Cour de cassation approved the setting aside of the asymmetric clause in the Rothschild case? It is true that, in another of its decisions, held on 12 June 2013, the Court strongly emphasized the merits of a clause that offered 'each party' 'two alternative routes': arbitration or judicial proceedings before the court for the place where the buyer is domiciled.10 It seems that the Cour de cassation is sensitive to formally perfect equality.

However, no evidence, either in European law or in French private international law, imposes that party autonomy be symmetrical in form.11 The French courts have recognized that a clause can also give one party only a choice between arbitration in the Netherlands and a trial before Dutch domestic courts.12

It is even harder to enforce symmetry as a dogma on the parties that the objective rules of jurisdiction, be they French or from the Brussels I Regulation, often offer options of jurisdiction that both parties cannot enjoy in the same manner.13 In addition, the Cour de cassation protects the exorbitant ground of jurisdiction laid down in Article 14 of the French Civil Code, which itself is not a model of equality.14 For this reason, the French Supreme Court is not well placed to give lessons in symmetry.

Finally, under Article 6.1 of the European Convention on Human Rights, the right of access to a court and the principle of equality of arms do not have 66 | ICC Institute of World Business Law Jurisdictional Choices in Times of Trouble absolute authority. States enjoy a certain discretion in the area of jurisdiction and equality of arms requires only that a party not be placed 'in a situation of substantial disadvantage vis-à-vis his opponent'.15

Asymmetry not being wrong in itself, it is therefore appropriate to seek another explanation for the Rothschild judgment.

3 Prohibiting arbitrary clauses

A strong line of authority in France has long refused to allow one of the contracting parties to be at the mercy of the other when jurisdiction is at stake. There is no recognition of clauses allowing a party to sue the other one in any court wheresoever. In other words, the choice shall not be unlimited and a party cannot impose an absolute uncertainty on the other party. There are many decisions to this effect not only in the maritime sector,16 but in other sectors as well.17

This hostility is reflected in the Rothschild judgment. The Cour de cassation highlights the 'potestative character' of the disputed clause.18 For their part, the lower judges' decisions branded the arbitrary or discretionary nature of the clause.19 But aversion to potestativité and arbitrariness is not unique to France. It is found in the Coreck Maritime ruling held in 2000 by the European Court of Justice. This ruling requires that the choice-of-court clause be drafted based on 'objective' elements and 'sufficiently precise to enable the judge to determine whether he has jurisdiction'.20 By requiring 'factors sufficiently precise to enable the court seised to ascertain whether it has jurisdiction', the parties are protected, so that neither one is depending on the arbitrariness of the other.

Under these conditions, an asymmetric clause may be accepted if made objective and sufficiently precise. This is true in France and even after the Rothschild judgment. The Paris Court of Appeal, in a decision dated 8 April 2014, was submitted the following clause: 'This Agreement and the corresponding relationship between the parties shall be governed by and construed in accordance with the laws of the Republic of Ireland and the parties shall submit to the jurisdiction of the courts of the Republic of Ireland. Apple reserves the right to institute proceedings against Reseller in the courts having jurisdiction in the place where Reseller has its seat or in any jurisdiction where a harm to Apple is occurring'. The Court held that 'it cannot be considered that the choice of court is left to the sole discretion of [Apple] since only the courts of the place of incorporation of [the Reseller] or the place where the damage was suffered by [Apple] can be chosen'; the choice being 'enacted in the light of specific criteria for determining the competent courts, albeit multiple, any potestative character' is excluded. Finally, 'the clause that identifies the courts potentially competent to adjudicate a dispute in connection with the execution or interpretation of the contract, meets the requirement of foreseeability which must meet the choice of forum clauses'.21

Thus, the accuracy of the options that the clause gives to one party makes it predictable, and predictability sweeps away potestativité. Similarly, it should be possible to allow a party to take advantage of all the rules of jurisdiction available under this or that text, while leaving only one judicial way for the other party. The Brussels Convention of 27 September 1968 allowed for this in the fifth paragraph of Article 17,22 and nothing in the Brussels I Regulation prohibits it.23

Finally, the crucial question in the Rothschild case was whether in quoting 'any other competent court absent the aforementioned choice of court', the clause was elliptical and targeted the ordinarily competent courts available on the basis of Brussels I Regulation, or whether it was arbitrary, wanting to cover all the courts in the world.

The answer is known: the French judges concluded that the bank had reserved for itself the opportunity to choose any court on the surface of the planet. In short, they interpreted the clause for worse, not for better.

4 Interpreting ambiguous asymmetric clauses

Therefore, the key to the Rothschild case seems to lie in a certain pessimism that occurs in the French courts facing asymmetric ambiguous clauses. When a clause refers only to 'any other competent court', the French judges tend to understand that this may be any court in the world since the legal origin of the jurisdictional competence is not identified.24 They are likely to suspect that the party taking advantage of such a clause was ill intentioned when it had it drafted.25

This pessimistic interpretation is close to Article 1162 of the French Civil Code, which courts can draw upon to interpret a clause against the one who enacted it.26 However, it is not a universal state of mind. Without mentioning the English courts,27 it should be noted that there is a more serene and confident approach in Luxembourg courts, although the Luxembourg Civil Code contains a provision identical to the 1162 French Article. In Luxembourg, a clause, which merely mentions 'any other competent jurisdiction', is equated with the accepted agreement of Article 17.5 of the Brussels Convention and must be understood by reference to the rules of jurisdiction, which would have been applicable to the dispute if the clause had not been specified. Clauses of this type are held to be not discretionary but simply 'dissociative', asymmetric without being arbitrary.28

5 Conclusion

Firstly, the Rothschild judgment relates to all contracts, not just contracts between businesses and consumers. Secondly, the French courts do not absolutely require contractual arrangements on jurisdiction to be symmetrical. However, an asymmetric clause must not offer an unlimited judicial choice to the party benefiting from it; this would be considered as potestative, which is 'arbitrary' or 'discretionary'. Finally, an ambiguous asymmetric clause, especially if it is written by the party who benefits from it, risks being interpreted by the French courts as a discretionary clause; if so, it will be rejected.

Therefore, for the drafters of asymmetric choice-of-court clauses, caution consists in organizing choice of court with reference to objective precise criteria or to objective rules of jurisdiction deriving from a text that will be expressly identified.

Otherwise, in France, if the clause may give the impression to offer unlimited judicial access to one of the parties, it will be difficult to convince French judges that this is not what the parties had in mind. In another country, the party claiming an ambiguous asymmetric clause may find itself before less suspicious judges. Honni soit qui mal y pense!

1
Cass. 1 re civ., 26 September 2012, No. 11-26.022, Petites Affiches, 2012 (228), p. 7, case note by Jean-Grégoire Mahinga; Recueil Dalloz 2012, p. 2876, case note by David Martel; Droit et procédures 2012 (11), p. 290, case note by Gilles Cuniberti; Revue de jurisprudence commerciale December 2012, p. 21, case note by Pierre Berlioz; Semaine juridique, édition générale 2013, n° 105, case note by Louis Degos, Dara Akchoti; Journal du droit international 2013, p. 175, case note by Carine Brière; Revue critique de droit international privé 2013, p. 256, case note by Dominique Bureau; Revue trimestrielle de droit financier 2013 (1), p. 88, case note by Pierre-Emmanuel Partsch, Emmanuel Robberecht; Marie-Elodie Ancel, Léa Marion, Laurence Wynaendts, 'Réflexions sur les clauses de juridiction asymétriques', Banque & Droit, 2013 (148), p. 3 (English version on SSRN <www.ssrn.com>); Julie Klein, 'La surprenante potestativité d'une clause attributive de juridiction', Revue des contrats 2013, p. 565; Jean-Baptiste Racine, 'Le caractère potestatif d'une clause attributive de juridiction internationale conduit à son inefficacité', Revue des contrats 2013, p. 661.

2
Richard Fentiman,'Unilateral jurisdiction agreements in Europe', The Cambridge Law Journal 2013 (72), p. 24; Journal des Tribunaux, Luxembourg 2013, p. 7, case note by Pascal Ancel, Gilles Cuniberti (also on SSRN <www.ssrn.com>); Caroline Verbruggen, 'La compatibilité d'une clause (unilatérale) optionnelle de juridiction avec l'article 23 du Règlement Bruxelles I', Revue de Droit Commercial Belge - Tijdschrift voor Belgisch Handelsrecht, 2013 (5), p. 443; Maxi Scherer, Sophia Lange, 'The French Rothschild case: a threat for unilateral dispute resolution clauses?', 18 July 2013, <kluwerarbitrationblog.com>.

3
For a complete study of such clauses, including arbitration, see Jérôme Barbet, Peter Rosher, 'Les clauses de résolution optionnelles', Revue de l'arbitrage, 2010, p. 45.

4
Paris Tribunal de grande instance, 18 January 2011, RGNo .09/16659.

5
Paris Court of Appeal, 18 October 2011, RGNo .11/23572.

6
EC Regulation No .44/2001, 22 December 2000, on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, Official Journal of the European Communities, 16 January 2001, L 12/1.

7
Brussels I Regulation, Articles 15 to 17 concerning consumer contracts. It can only be assumed that the Luxembourg bank has not pursued its activities in or directed its activities towards Spain, where the client was domiciled.

8
Brussels I Regulation, Article 17: 'The provisions of this Section may be departed from only by an agreement: 1. which is entered into after the dispute has arisen; or 2. which allows the consumer to bring proceedings in courts other than those indicated in this Section; or 3. which is entered into by the consumer and the other party to the contract, both of whom are at the time of conclusion of the contract domiciled or habitually resident in the same Member State, and which confers jurisdiction on the courts of that Member State, provided that such an agreement is not contrary to the law of that Member State'.

9
Luxembourg Tribunald' arrondissement, 29 January 2014, No .153 636, 155 943, 156 026 and 157 028; No. 153 635, 155 942, 156 025 and 157 029.

10
Cass. 1re, civ., 12 June 2013, No. 12-22.656.

11
See Cass. 1re civ., 13 April 1999, No. 96-22.517, holding that a clause, which places parties in different positions as regards jurisdiction, does not violate the equality of the contracting parties.

12
Cass. 1re civ., 15 May 1974, No. 72-14.706.

13
For example, in a dispute relating to the provision of services where the service must be provided in the place of domicile of the service provider, the beneficiary of the service can only start proceedings in the member state where the service provider is domiciled, as set out in Article 2 of the Brussels I Regulation. Article 5(1) of the Regulation designates no other courts as competent. However, the service provider is given the choice of filling a claim in the court for the place of its domicile, by virtue of Article 5(1), while retaining, by virtue of Article 2, the option of suing the defendant in the member state where the latter is domiciled.

14
Article 14 of the French Civil Code reads:' Analien, e venifnotr esidingin France, may be cited before French courts for the performance of obligations contracted by him in France with a French person; he may be called before the courts of France for obligations contracted by him in a foreign country towards French persons'. The Cour de cassation has refused to refer to the French Constitutional Court a question on Article 14 of the Civil Code maintaining that this article 'cannot be regarded as violating the principle of equality or the right to a fair trial and, as such, the question posed does not present serious characteristics as regards the constitutional rights invoked' (Cass. 1re civ., 29 February 2012, No. 11-40.101).

15
Broadly speaking, the European Court of Human Rights recognizes that states enjoy a certain margin of appreciation in the definition of jurisdictional competence, provided that limitations applied pursue a legitimate aim and maintain a reasonable relationship of proportionality between the means employed and the aim sought to be achieved (See ECHR, 29 June 2011, Sabeh El Leil v. France, para. 47)

16
Cass. Com., 24 April 1990, No .88-19.877('the jurisdiction clause in question did not confer exclusive jurisdiction on the designated court; it gave one of the parties the possibility of selecting another court, (…) the Cour d'appel rightly held this clause to be void'). See also Rouen Court of Appeal, 17 January 1991, Droit maritime français 1992, p. 136 (the clause 'contains a condition potestative that renders it void'); Rouen Court of Appeal, 8 December 1994, RG No. 9301131; Rennes Court of Appeal, 26 September 1990, Droit maritime français 1993, p. 309 (the court notes 'a discretionary choice' for the benefit of one party only).

17
Paris Court of Appeal, 5 July 1989, Journal du droit international 1990, p. 152, case note by André Huet: 'this clause gives one of the parties an unlimited choice as to jurisdiction and therefore allows any and all fraud intended to prevent the successful administration of justice'; 'it is therefore contrary to the object and finality of the prorogation of jurisdiction envisaged by article 17 of the Brussels Convention'.

18
Potestativité is a notion employed in French contract law to characterize a modality that places, in a discretionary or arbitrary fashion, the existence of an obligation and/or its binding nature at the will of the party whose obligation it is (French Code civil, Article 1170: 'A potestative condition is one which makes the fulfillment of the agreement depend upon an event which one or the other of the contracting parties has the power to make happen or to prevent'). French law considers that such an obligation is void because the person on whom the obligation rests does not intend to be bound by it (French Code civil, Article 1174: 'An obligation is void where it was contracted subject to a potestative condition on the part of the one who binds himself').

19
For the Paris Court of Appeal, that the bank reserves'the right to sue in the place of domicile of the client or in front of any other competent court' is construed as meaning that the choice of forum is abandoned to the 'discretion' of the bank, and 'extends to all EU member states and any third country' thereby constituting 'a very extensive discretionary choice'.

20
ECJ, 9 November 2000, Case C -387/98, Maritime Coreck, para. 15.

21
Paris Court of Appeal, 8 April 2014, RG No .13/21121. SeealsoAix -en-Provence Court of Appeal, 14 March 2013, RG No. 013/267, Droit maritime français 2014, p. 758, case note by Julien Lecat, about a clause entitling a carrier 'to pursue any claim against the Merchant in Antwerp according to Belgian law or in any jurisdiction in which the Merchant has asset and/or registered office'. The Aix-en-Provence Court of Appeal considered the clause to be a mere practical application of the French and Belgian rules of jurisdiction, as well as of Article 2 of the Brussels I Regulation, and that, as such, its effect was not left to the sole discretion of the carrier.

22
Brussels Convention, Article17.5:'If an agreement conferring jurisdiction was concluded for the benefit of only one of the parties, that party shall retain the right to bring proceedings in any other court which has jurisdiction by virtue of this Convention'.

23
See Fausto Pocar,'Convention on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, signed in Lugano on 30 October 2007, Explanatory Report', Official Journal of the European Union, 23 December 2009, C319/1, No. 106: 'The 1988 Convention [that also allowed unilaterally exclusive choice-of-court agreements] has now been amended to give general recognition to the validity of a non-exclusive choice of forum clause [to be aligned with the Brussels I Regulation], and at the same time the provision in the 1988 Convention that allowed a clause to be concluded for the benefit of one party only has been deleted'.

24
Montpellier Court of Appeal, 25 March2014, RG No . holding that a clause is 'potestative' when it confers exclusive jurisdiction to English courts but only vis-à-vis one party, the other one being allowed to bring proceedings in any other competent court (labeled by the parties 'alternative forum').

25
For an exception, Paris Tribunal de commerce, 9 September 2013, RG No . 2013013500, upholding a clause according to which the courts of Northern Ireland are exclusively competent unless the seller chooses to bring proceedings in another country.

26
Article1162 of the French Civil Code reads:'In case of doubt, an agreement shall be interpreted against the one who has stipulated, and in favor of the one who has contracted the obligation'.

27
[2013] EW HC1328( Comm.), Mauritius Commercial Bk Ltd v. Hestia Holdings Ltd et al., para. 38: 'If there were any doubt, it would be necessary to keep in mind that it would be unlikely that the parties could have intended to submit their disputes to any court in the world however exorbitant'.

28
See above Luxembourg Tribunald' arrondissement, 29January2014, and, on dissociative clauses, Marie-Elodie Ancel, Léa Marion, Laurence Wynaendts, 'Réflexions sur les clauses de juridiction asymétriques', at p. 7.