Extraterritorial jurisdiction in Civil Wrongs - An international law perspective

When an extra territorial wrong is committed, which can be the forum for adjudicating the dispute? This is no more a novel issue, but still debatable. In domestic torts, the law is settled that a wrong is done either where the wrongful act takes place or where its effects are experienced​[1].

A suit for compensation with respect to a tort committed aboard is maintainable in Indian Court, provided that the defendant resides, carries on business or personally works for gain in India[2]. Residence may not be a full residence but it includes a minimum presence[3], as recognised by the US courts by adopting the principles of minimum contact[4]. A non-resident defendant may have minimum contacts with the forum state, if he has direct contact with the State or at least has a deal with the resident of the State[5].

If the wrong is in such a nature that it is actionable under the domestic law and if the said act is not be a justifiable act under the domestic law of the country at where the act is committed, dispute can be entertained in India[6]  

Nevertheless, universal jurisdiction cannot be asserted to the civil wrongs and it is in the exclusive domain of the criminal jurisdiction[7]. In civil wrong, jurisdiction matter is important, as it implies and even in such cases that a forum court may hear a complaint filed by a foreign plaintiff against a foreign corporation for foreign harm[8]. True, there are arguments that the right of access to justice is a predominant right and universal jurisdiction in civil suits between foreigners and law of nations traditionally includes the public and private international law[9] and associated with torts and crimes[10]. 

Kiobel[11] is a case concerning to violation of physical integrity rights of Kiobel and others, the inhabitants of Nigeria. The US Court was asked to decide a question that whether and under which circumstances the Alien Tort Statute, allows courts to recognize a cause of action for violation of the law of nations occurring within the territory of a sovereign other than the United States.

 An Anglo Dutch business entity was proceeded for damages on the ground of human rights claim under the Alien Tort Statute[12] on the allegation that the Nigerian Government brutally crush peaceful resistance to aggressive oil development in the Ogoni Niger River Delta colluded with the said company and its Nigerian subsidiary company. A foreign Dutch company was sued on the allegation of a foreign harm in the Courts of United States on the reason that the act of foreign company amounts to violation of customary international law. However US Supreme Court, without going to the merits of the case has decided the maintainability of the suit under ATS and held that the presumption against extraterritoriality[13] applies to the claim under ATS and there is nothing in the Statute to rebut the presumption. Hence it was decided that the claims at issue in the case are not actionable for the reason that they were brought by foreigners against foreigners for their conduct in a foreign country.

The decision in Kiobel was widely criticised on the ground that it restricts the scope of universal jurisdiction, yet, the critics found that even after the decision, there are other bases of extraterritorial jurisdiction in international law, including jurisdiction over activity abroad that has effects within a State (objective territoriality), activity by State’s nationals abroad (active personality), activity against a State’s nationals abroad (passive personality) and activity that threatens the State and its official functions (protective principles)[14]

However, the Dutch Civil Court answered the issue differently in Akpan[15]. A transnational tort case against multinational corporations for an overseas environmental harm was decided on merit, accepting the jurisdiction under the European Union law, since the form State is one among the EU countries, though the cause of action was reported at an African country; i.e. Nigeria.

To decide the law of jurisdiction, the Dutch court adopted its EU regulations in Brussels I[16] and Rome II[17] which provides that person domiciled in a Member State shall, whatever their nationality, be sued in the Courts of that Member Country.

The law in EU countries permits extra territorial jurisdiction and allows a foreign litigant to submit under their jurisdiction, who alleges a foreign harm against a domestic corporation in the EU country. However, the lex loci delicti, the law of the State where the damage has occurred is applicable to decide the dispute in the transnational tort case, in EU countries and thus foreign law will apply for a foreign harm in the domestic courts of EU countries.

Akpan v. Shell is a suit for compensation for the environmental damages caused by Shell Petroleum, in Nigerian territory. The farmers who suffered huge loss as a result of oil spills alleged that the local subsidiary of Dutch multinational had failed to exercise its diligence and breached its duty of care to prevent oil leaks. They are bound under a tort of negligence and equally, the parent Dutch company is responsible for their negligence to enact sufficient guidelines to prevent and react to the oil leaks adequately. Domestic jurisdiction was assumed to Dutch Court by holding that the collective negligence by a domestic Nigerian company and its Dutch parent company is sufficient to constitute jurisdiction since the claims against both the companies are closely related and it justifies joint treatment.

Unlike in US jurisprudence[18], which mandates a contact of a foreign corporation with a domestic partner must be so continuous and systematic as to render it essentially at home in the forum state, in European law, it requires establishing a mere connection between two companies. Apart from the connected claim principles, as adopted in Akpan, under European law, as a rule of forum necessities, it asserts jurisdiction on local courts if there is a sufficient connection with local legal sphere and where it would be unacceptable to require the litigant to submit the case to the decision of the foreign court[19]. Sometimes it may expanded further to states that even in some case an EU country court would be allowed to exercise jurisdiction if no other forum guarantees the right to a fair trial and the dispute has sufficient connection with a local state in the European Union[20]. 

In the matters of extra territorial jurisdiction of domestic courts, in relation to civil wrongs, the rigid approach in US law and flexible approach in European law are evident from the case analysis of Kiobel and Akpan. Like in Kiobel reasoning, the US court adopted the reasoning of minimum contact; in the series of cases relating to Bhopal tragedy compensation, also. In Janki Bai Sahu v. Union Carbide[21], the reliefs sought against the UCC were rejected by the US Courts; on the ground that liability clause cannot be imposed against the company by reason of want of proof. But the US courts, in Sahu’s case as well as in the previously decided Bano v UCC[22], have entertained the litigations for damages, on the aspect of jurisdiction, but refused to grant relief, though the civil wrong committed by UCC and its counter partner UCIL was a foreign wrong, committed in India.

Exclusion of jurisdiction of civil courts must either be explicitly expressed or clearly implied. A civil court in India has jurisdiction to entertain a suit of civil nature except when its cognizance is expressly barred or barred by necessary implications[23]. The adjudicative jurisdiction of the Courts in India in extra territorial civil wrong is simply based on the residence principles in relation to defendant[24] and minimum presence prescription, as seen in the US jurisprudence. Honouring the sovereign role of the nations in international law, India adopts a pragmatic approach by virtue of the guidelines in the permissive rule; derived from international customs or conventions or from diplomatic missions. 

India has a definite approach in the matters of acceptability of the foreign judgment for execution in India. In Section 13[25] of the Code of Civil Procedure, definite situations are enumerated in the matters of enforceability of international judgments in national legal system. The enforceability clause[26] and the exclusion clause[27] in 1971 Hague Convention has made a similar approach in the matters of execution of foreign judgments in the national judicial system of the contracting states.