Justifications for Party Autonomy in the Context of Jurisdiction Agreements

Dr. Brooke Adele Marshall
University of New South Wales

Thursday, 12 September – 4:00 pm
Room W 201, Faculty of Law – Professor-Huber-Platz 2, 80539 Munich

This paper is concerned with normative reasons for respecting jurisdictional party autonomy. Justifications for the enforcement of exclusive jurisdiction agreements have not been comprehensively explored in the literature, which is surprising given their wide acceptance. Jurisdiction agreements overall have received significantly less theoretical attention than choice-of-law clauses.

Jurisdiction agreements in this paper are analysed through the lens of two broadly defined conceptions of party autonomy. The first is an instrumentalist, utilitarian conception. The second is an individualist, rights-based conception. A utilitarian conception of party autonomy, which encompasses legal certainty and economic efficiency, is dominant in the literature in justifying choice-of-court. A rights-based conception of party autonomy, which to date has focused on natural law, is a recent development in the choice-of-law literature, not yet applied to choice-of-court.

In essence, the justifications dealt with under a utilitarian conception see jurisdictional party autonomy as a means to an end, whereas those dealt with under a rights-based conception see jurisdictional party autonomy as an end in itself (though some justifications can be framed to fall within either conception). Legal certainty and the economic efficiency, produced inter alia by localizing legal relations to the most efficient forum, by regulatory competition and by the reduction of prediction costs, are the utilitarian goods which jurisdictional party autonomy is said to promote. Unlike a utilitarian conception which arguably ‘use[s] consent as a proxy for welfare-enhancing transactions’, consent is more significant under rights-based approaches, because it is the ‘ultimate justification’ for enforcement of the agreement.

The paper begins by scrutinizing what legal certainty means in the context of jurisdiction agreements before identifying private and public justifications for their enforcement on efficiency grounds. After examining the extension of the natural law rights-based conception of party autonomy to choice-of-court, the paper then introduces a further rights-based justification, not yet raised in the literature. By reference to these justifications, I seek to explain why the law should enforce exclusive jurisdiction clauses and how boilerplate contracting affects this analysis.

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