Codifying Torts Conflicts: The 1999 German Legislation in Comparative Perspective
| Author | Mathias Reimann |
| Position | Professor of Law, University of Michigan |
| Pages | 1297-1319 |
Page 1297
Professor of Law, University of Michigan; Dr. iur., Universität Freiburg, 1982; LL.M. University of Michigan, 1983. Thanks to Dorothee Janzen, LL.M., University of Michigan, 2000, for research assistance and many valuable comments.
While American conflicts law consists overwhelmingly of cases, continental Europe has a long and proud tradition of codifying private international law. 1 Particularly in the last two decades, Europe has witnessed a wave of national codifications and international conventions in this area. But at the turn of our century, the process of European conflicts codification is far from complete. While some areas, notably contracts, are broadly covered,2 others, such as corporations, are still in flux.
Tort conflicts lie somewhere in the middle. While there is still no general European convention in force addressing them,3 they have been codified in most but not all individual countries. But the last two years have brought considerable progress: Germany finally joined the countries with codified tort conflicts rules, and an international working group drafted a European Convention on the law applicable to non-contractual obligations.
I will look at the modern codification of tort conflicts rules in the national, European, and transatlantic contexts. The innermost of these three concentric circles is the 1999 German legislation; its characteristic features are interesting enough in their own right for American conflicts scholars (I). These features are then considered in their European environment; here, we see that the new German law accords with a growing regional consensus about the basics of tort conflicts (II). Finally, we will look at written tort conflicts rules in the United States and Canada; the similarities with the European texts indicate an international trend in the resolution of transboundary tort cases (III).
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Germany's choice-of-law rules are contained in the Introductory Act to the Civil Code (BGB).4 Originally enacted together with the Code in 1896, they were completely overhauled in 1986.5 Yet, the rules in the reformed Act of 1986 were still fragmentary. They covered general issues (such as renvoi and public policy), persons, the form of legal transactions, family law, succession, and contracts, but they remained virtually silent on non-contractual obligations (such as torts),6property, agency, and corporations. In these areas, the government found insufficient consensus and thus left them to caselaw and scholarship for the time being.
In the long run, such incompleteness is difficult to tolerate in a legal culture committed to comprehensive codification. Nonetheless, the project to cover the remaining areas languished for almost a decade. Suddenly in 1998, the federal cabinet presented a draft to the legislature which passed it within a few months. All this happened virtually without discussion or public attention.7 The provisions entered into force on June 1, 1999.8
The new legislation fills two important gaps in the German private international law statute. First, it adds choice-of-law rules governing non-contractual obligations. This category comprises not only torts (article 40) but also unjust enrichment (article 38) and management of another's affairs (article 39). Second, the legislation contains new rules on property (articles 43-46). Provisions on agency and on corporations are still lacking.
The overall approach is a moderately conservative blend of territorialism and the closest connection principle. On the one hand, the rules use mainly territorial criteria. With regard to non-contractual obligations, they point first and foremost to the law of the state in which the crucial acts and effects took place (articles 38 Page 1299 (2) and (3), 39 (1), 40 (1)); for property rights, they select primarily the law of the situs (articles 43 (1)).9 On the other hand, the choice made by territorial criteria can be overridden if the case has a significantly closer connection with another state (articles 41, 46).
From an American perspective, some parts of the new German legislation are more interesting than others. The rules pertaining to unjust enrichment and management of another's affairs are of limited practical importance; they are also difficult to grasp for a common law lawyer who is not familiar with the dogmatic structure of the respective substantive areas of civil law. And the provisions governing property are so straightforward and so similar to their common law counterparts that they require little explication. Clearly the most intriguing aspects of the new German legislation are the provisions pertaining to tort conflicts.
The new German rules on tort conflicts are concise and general.10 They consist of only three articles and apply to all tort cases. The government deliberately chose to limit them to the basic provisions and thus to forego special treatment of particular categories of torts (such as products liability, defamation, unfair competition, or mass accidents),11 trusting that the general rules will prove flexible enough to accommodate the specific concerns arising in these areas.
There is no special provision about local rules of safety and conduct either. Yet, neither German courts nor scholars have ever seriously doubted that in judging the defendant's conduct, the law of the place where it occurred must be taken into account.12 The legislature did not intend to change this rule but simply saw no need to spell it out.13 It will thus continue to apply.
The order of the three articles on torts is peculiar and potentially confusing, at least to a civilian reader. Article 40 applies specifically to torts (only) while subsequent articles 41 and 42 apply generally to (all) non-contractual obligations (including torts). In other words, the statute proceeds from the narrower to the Page 1300 broader provisions. This not only violates the traditional civil law canon that general rules precede specific ones, it is also inconsistent with the rest of the German conflicts statute where this canon is observed. The drafters of the new rules should have maintained the traditional order, both for the sake of internal consistency and in order to facilitate the analysis.
At their core, the new tort conflicts provisions consist of a ground rule which is subject to potential overrides on three levels. Thus it is important that the basic rule and exceptions be applied in the right order. In addition, there are special provisions limiting damages and favoring direct actions against insurers.
The basic rule is laid down in article 40 (1): tort claims are governed by the law of the state where the defendant acted. If the harm occurred in that state as well, as would normally be the case, the choice is clear and the result is the same as under the traditional American rule pointing to the place of the harm.14
If conduct and harm occur in different countries, however, German law adds a peculiar pro-recovery twist: it leaves the choice between the respective laws to the plaintiff! This "principle of favorable law" (Gùnstigkeitsprinzip) is not a novelty introduced by the recent legislation15 but had long been established in German caselaw and scholarship.16 In fact, article 40 (1) now restricts it in an important regard. Hitherto, the plaintiff could freely choose, and if he failed to do so, the court had to apply the more favorable rules ex officio. This forced the judge (at least theoretically) to research and evaluate the claim under both laws. Now, the court is liberated from that burden. If the plaintiff wants to opt for the law of the place. of the harm, he must do so at an early stage of the procedure. If he does, the chosen law governs. If the plaintiff fails to use this option in timely manner, the law of place of conduct applies by default. In either case, the court proceeds under one law only. Thus it is now the plaintiff (or his attorney) who must research and evaluate both laws if he wants to benefit from the more favorable regime.17
From these essentially territorial ground rules, article 40 (2) makes a major exception: if plaintiff and defendant have their habitual residence in the same state, Page 1301 the law of that state takes precedence. This exception is, again, not new.18 Article 40 (2) codifies, and to some extent clarifies, long established caselaw.19...
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