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Objection of jurisdiction

Question: We carried 8x20’ containers of cargo from Xingang, China to Moscow via Kotka, Finland in January 1999, but unfortunately some of the cargo were found damaged when delivery in the destination. It is provided in the terms and conditions on back of the combined transport bill of lading we issued for the cargo that “JURISDICTION: Any dispute arising under and/or in connection with this Bill of Lading shall be determined by the court in the Federation of RUSSIA.” A few days ago, the shipper, a China import & export company, filed an action against us in China Tianjin Maritime Court, and our representative office in Beijing received a Notification Calling for Responses to the action. Our question is if we should respond to the action, if yes, how should we respond?

- A Russian international transport company. May 10,1999

Answer: Yes, you should respond to the action in time, otherwise you would lose the rights and opportunity of defense, and then probably undertake more risks of losing the action, which would directly produce ill effect to your property and reputation in China.

In response, you may send a Dissenting Opinion of Jurisdiction requesting the Court to dismiss the action with following arguments:

(1) It is agreed on the back of the bill of lading that any dispute arising under and/or in connection with the Bill of Lading shall be determined by the court in the Federation of Russia but in China.

(2) Above agreement on election of forum is conformity with the provision by Article 244 of China Civil Procedure Law, which is “Parties to a dispute over contract concluded with foreign element … may, through written agreement, choose the court of the place which has practical connections with the dispute to exercise jurisdiction.”

(3) According to the provisions by Article 7, item 3 of the Concrete Provisions of China Supreme People’s Court on Jurisdiction of Maritime Litigation with Foreign Element (1986), China courts recognize the legal effect of jurisdiction clause on a bill of lading.

(4) As the dissenter, your firm is a company registered in Moscow. The final destination of the cargo is Moscow and it was in Moscow that the cargo was found damaged. So it is more convenient for relevant Russia court, which is easier to obtain the evidences concerned, but Tianjin Maritime Court to hear the case.

Please note that the objection should be referred only to procedural defense but to substantial defense and raised within the period prescribed for submission of defense.

- Wang Xuanjun May 11, 1999

Note: All answers here are for reference. Mr. Wang shall have neither liability nor responsibility to any party for any loss or damage caused or alleged to caused by the use of the answers without written confirmation to the party.

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