International Jurisdiction for the Scottish Courts?

Scots lawyers, and all European lawyers, should be interested in the German case of Ralph Schmidt v Lilly Hertel, which has recently come to my attention.

Followers of previous updates we have provided, will recall that by virtue of the UK being a party to the European Regulation on Insolvency Proceedings (Reg 1346/2000/EC), Scotland’s Insolvency law is now completely subject to that regulation being complied with. That can add complications, and different results, from what Scots lawyers would have traditionally expected.

However, there are positives that arise for insolvency practitioners. I think this German case is one of them.

The German court held that the office holder was able to raise proceedings in Germany against an individual domiciled in another member state because the primary insolvency proceedings were in Germany. The court seems to have had the view that Article 3 (1) of the regulation on the commencement of primary proceedings, should be interpreted to give the courts in the member state opening proceedings, jurisdiction to decide actions to set aside transactions; irrespective of domicile.

The cases where this arise in Scotland may be few and far between, but as and when they do this will be useful.

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