Practical case no. 1 – Cometa vs.DreamKites- Spanish Court
- Facts
DreamKites is a French company located inBordeaux producing high quality wind-kites used for kite-surfing activities.
Cometa is a Spanih company located inValenciaorganizing kite-surfing courses in different locations in Spain, different events and competition for kite-surfers. Based on a commercial relationship of more than 5 years with DreamKites,Cometa purchases from theFrench company various types of kites, surf boards, technical equipment, etc, for resale in Spain (Fuerteventura, Tarifa, Coruna), Germany and Italy.Usually, the Spanish company issues an order to the seller, DreamKites, via fax or email when a client of Cometa requests a product.
Even if there is no written agreement between the two companies in this sense, the distribution activity of Cometa covers also on line sales of DreamKites’ products by Cometa via its website which is designed in mainly in Spanish and the page concerning the selling of the products can be uploaded also in English, German and Italian language. The international edition of the magazine edited by DreamKites mentions the contacts andthe website for ordering products distributed by Cometa.
In February 2015, DreamKites banned Cometa from using the appellation ‘DreamKites.Espagne” and closed the website It informed also Cometa that, as from December 2014, another Spanish company will have exclusive distribution of the DreamKites’ products in Spain, through which Cometawas invited to place its orders.
On 13 September 2015,Cometasued DreamKites before the Valencia Court asking for compensationsfor non-compliance with their distribution agreementand additional compensation under the Spanish Law of 1981 on Unilateral Termination of Exclusive Distribution Agreements of Indefinite Duration.[1]
DreamKites contested the Spanish Court’ s jurisdiction arguing that the French court of its headquarter[2] in Bordeauxhas jurisdiction under Article 4 of the Regulation 1215/2012. The defendant also contested that the commercial contract between the two parties was an exclusive distribution agreement due to the absence any written agreement in that sense and underlined that it was a simple contract for purchase and sale concluded on the basis of orders of Cometa.
The plaintiff responded to that objection as the parties concluded a distribution agreement contract based on an oral agreement followed by longtime commercial relationships in so far as Cometawas authorized to resell in Spainthe products purchased from the defendant with whom it had an exclusive relationship of distribution. Moreover, Article 4 of the Spanish Law of 1981 on Unilateral Termination of Exclusive Distribution Agreements of Indefinite Durationclearly states that in this case the jurisdiction for hearing the case belongs to Spanish Courts.
2. Relevant legislation - Domestic law
The 1981 Law on Unilateral Termination of Exclusive Distribution Agreements of Indefinite Duration
Article 1(2) - A distribution agreements is any agreement pursuant to which a grantor reserves, to one or more distributors, the right to sell, in their own name and for their own account, products which it manufactures or distributes’.
Article 4 - ‘If a distributor has suffered damage further to the termination of a distribution agreement covering all or part of Spanish territory, he may in any event bring legal proceedings against the supplier before the Spanish courts or before the courts for the place where supplier is domiciled or has its registered office. If the proceedings are brought before the Spanish courts, they must apply Spanish law exclusively.’
Scenario no. 1 - Tasks for the Court:
- How will Valencia Court decide on jurisdiction?Identify the relevant provisions applicable on this case in connection with the jurisdiction of the competent court (Spanish or French Court).
- Is the legal qualification of the contract concludedbetween DreamKites and Cometa relevant for establishing jurisdiction in this case? Give arguments to support the qualification of the contract.
Scenario no. 2
The plaintiff argues that the orders placed in 2015 via fax and e-mail to the defendant contained a jurisdiction clause in favor of the Spanish Courts for all the disputes arising from the distribution contract. The execution of that order by DreamKites by selling the products to Cometarepresented an acceptance of the jurisdiction of the Spanish Courts as any communication by electronic means which provides a durable record of the agreement equals to "writing" in the sense of the European Regulations.
The defendant contested that the commercial contract between the two parties was an exclusive distribution agreement due to the absence any written agreement in that sense and underlined that it was a series of simple sale contracts concluded on the basis of orders placed by Cometa. Moreover, it added that Cometa acted in bad faith when using, without having permission, the DreamKites’s brand and logo in the website The defendant was of the opinion that the contract was not valid and the eventual jurisdiction clause follows the legal regime of the main contract. Additionally, DreamKites never accepted expressly, in unequivocal manner and in written form such jurisdiction clause contained by some of the orders placed by Cometa.
Task for the Court:
1. Is the jurisdiction clause valid?Identify the relevant provisions applicable to this aspect.
Scenario no. 3
After the unexpected closing of its website by DreamKites, on 12 May 2015, Cometa sued DreamKites before the Bordeaux Court asking for the enforcement of the distribution contract concluded between the parties and for damages for non-compliance with their distribution agreement.
DreamKites contested that the commercial contract between the two parties was an exclusive distribution agreement due to the absence any written agreement in that sense and underlined that it was a simple contract for purchase and sale concluded on the basis of orders of Cometa.
The French court adjourned the case for different procedural aspects without giving a ruling on its internationaljurisdiction in this case before the moment when Cometa initiated proceedings before the Spanish Court on 13 September 2015 (see Scenario no. 1).
DreamKites informed the Spanish Court about the identical claim brought by Cometa in front of the French Court and asked the court to apply the relevant provisions of Regulation no. 1215/2012.
Cometa stated that the two set of proceedings are not identical as cause of action is different for each case.
Task for the Court:
1. What will Valencia Court decide on this aspect?Identify the relevant provisions applicable to this aspect.
1
[1] The content of the abovementioned legislation is fictional.
[2] In the sense of statutory seat and central administration.