(by Nikolai Sosa Rebelo)
First, jurisdiction is the power to say the law
and to enforce a decision, based on the theories from roman civil law tradition[i].
In common law courts of the U.S., jurisdiction also means power over a person or
a property, but sometimes jurisdiction is stablished in grounds of principles,
like fairness[ii]. Therefore,
an American Court is likely to waive its power to decide a dispute because of
the unfairness to impose unreasonable costs to party to litigate away from home
ASAHI METAL LTD. v. SUPERIOR COURT OF CALIFORNIA, SOLANO COUNTY SUPREME COURT
OF THE UNITED STATES 480 U.S. 102 (1987). Nevertheless, this would not happen
in a Brazilian Court, for instance, because the Constitution states that no law
can prevent the right to seek a right in front of a Brazilian Court (Federal
Constitution of Brazil, Article 5º, XXXV). In Brazilian Law, only the parties
can waive their right to seek judicial recovery or transfer the jurisdiction to
another place (or to a private party).
The problem of international cases is that a
party needs to look to two or more different legal systems, in order to find
the answer for the issue of jurisdiction and enforceability of a judgment.
Dealing with jurisdictions involve multiple sovereign states that cannot impose
their sovereignty on each other. Therefore, a legal remedy can be ineffective
in the nation where the counterparty has assets, even though the issuing
authority considers that it has authority to decide the matter. Arbitration agreement
reduces the scope of discussion about jurisdiction, because parties chose the
dispute resolution method based on their autonomy. The parties themselves grant
the power to the arbitrators to decide the conflict. The main question about
jurisdiction would be restricted to arbitrability in those cases (in some
complex cases, some issues may arise over the jurisdiction of arbitrators over
non-signatory parties of the arbitration agreement).
The other aspect is service of process. It is
related to jurisdiction, because only after a proper service of process a court
will have jurisdiction over a defendant. Again, issues arise on what is a
proper service of process. In Brazil, the judicial authorities must serve
documents provided by one party to the other parties. In the other hand,
American Law left this task in the hands of the plaintiff. Thus, there is a shock
of legal systems in some situations, because American Courts may find a proper
service of process where Brazil finds that it was improper. In international
cases, American Law does not require the letter rogatory, KREIMERMAN V. CASA
VEERKAMP THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT 22 F.3D 634
(1994). However, Brazilian Courts will not accept other forms other than letter
rogatory to serve the process to Brazilian defendants to respond to lawsuits
outside Brazil (Superior Court of Justice – STJ Process SEC 10877[iii]).
Therefore, a claimant may believe that he got a relief, but, in reality, the
decision will not be recognized in the other jurisdiction.
Once again, arbitration shows its strength. In
regards of service of process, the arbitration procedure is flexible and its
flexibility is accepted worldwide. The New York Convention stablished the
parameters of award’s recognition in almost 200 countries. Therefore, the
resolutions granted by arbitrators are more powerful than judicial decision,
because of the existence of the NY Convention that facilitated the mobility of
international awards. Furthermore, there is not a similar treaty regarding
judicial decisions. Let us take the example of Brazil. Even though Brazilian
Law demands service of process by letter rogatory to international cases, this
is not applied to arbitration, because the rules of civil procedure are not
applicable. In international Arbitration, the Superior Court of Justice
recognizes awards if the party gave notice of the arbitration procedure by the
means provided in the arbitration agreement or by the rules of the arbitral institution
(Superior Court of Justice, Process SEC 3660[iv]).
In conclusion, we must say that the cooperation
of Judicial Courts an Arbitral Tribunals is crucial for the effectiveness of
arbitration procedures. That said, we acknowledge and accept the fact that
judiciary will always be an important part of the dispute resolution engine,
while arbitration is another part of the same engine that is adequate to
specific sorts of disputes. Therefore, arbitration can facilitate solutions of
international disputes avoiding the bureaucracy of some legal systems and
avoiding the uncertainty of many conflictual rules among different countries,
but at some point, we can never escape to seek enforcement through the official
courts.
[i] Tesheiner,
José Maria Rosa. Jurisdição. Revista Páginas de Direito, Porto Alegre, ano 0,
nº 13, 15 de agosto de 2000. Available
at: http://www.tex.pro.br/home/artigos/148-artigos-ago-2000/6175-jurisdicao
[ii] For more information of
theories about jurisdiction, see: von Mehren, Arthur Taylor. ADJUDICATORY
JURISDICTION: GENERAL THEORIES COMPARED AND EVALUATED in 63 BOSTON UNIV. L.REV. 279, 280-290 (1983).
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