Aston Martin MENA Limited v Aston Martin Lagonda Limited
[2023] EWHC 3285 (Comm)
Kerish International Motors Agency v Opel Automobile GmbH
7 May 2024
[2024] EWHC 1047 (Comm)
High Court
A Palestinian car dealership sued Opel for compensation after their contract ended. Even though a part of the contract said they might get money if the ending wasn't fair, the court decided the dealership wasn't the kind of business that would qualify for that money under Palestinian law, and so dismissed the claim.
Key Facts
- •Kerish International Motors Agency (KIMA), a Palestinian car dealership, had a Dealer Sales and Services Agreement (DSSA) with Opel Automobile GmbH (Opel), a German car manufacturer.
- •The DSSA, governed by English law but with a clause referencing "national law" for compensation, terminated in 2020.
- •KIMA claimed compensation under Palestinian law (specifically Article 15 of Law 2 of 2000), arguing it was a commercial agent whose contract was terminated without serious reason.
- •Opel disputed KIMA's interpretation of the DSSA, KIMA's status as a commercial agent, and the existence of a serious reason for termination.
- •The case involved multiple visits to KIMA's Motor Mall, with differing accounts of its condition and KIMA's performance.
- •A tender process for a new Opel dealership in Palestine was initiated by Opel, but never completed.
- •KIMA invested significantly in a new facility (Motor Mall) and experienced increasing sales with Opel before the relationship deteriorated.
Legal Principles
Interpretation of contracts: Determining the meaning of "national law" in a contract governed by English law but containing a clause referencing "national law" for compensation purposes.
DSSA, Article 19.1
Incorporation of foreign law into an English contract: Whether a reference to "national law" incorporates specific provisions of Palestinian law or simply refers to mandatory rules of the governing law.
Dicey, Morris & Collins on the Conflict of Laws (16th ed), paragraph 32-079
Definition of "commercial agent" under Palestinian Law 2 of 2000: Determining whether KIMA met the criteria for a commercial agent under Palestinian law.
Law 2 of 2000, Article 1
"Serious reason" for termination under Palestinian Law 2 of 2000: Defining the standard for a "serious reason" justifying termination of a commercial agency agreement without compensation.
Law 2 of 2000, Article 15
Termination of contract: Analyzing the grounds for termination under the DSSA (Article 18.2, 18.3.1(d), 18.3.2) and whether those grounds were met.
DSSA, Articles 18.2, 18.3.1(d), 18.3.2
Outcomes
KIMA's claim for compensation was dismissed.
While the court found that the DSSA incorporated relevant provisions of Palestinian law regarding compensation for termination, it ultimately determined that KIMA was not a commercial agent under Palestinian law and therefore not entitled to compensation under Article 15 of Law 2 of 2000. Further, Opel did not breach the DSSA.
KIMA's request for a declaration that the August 2019 termination notice was null and void was refused.
The court found that the August 2019 letter was not a termination notice, but a reference to the earlier February 2019 notice. The court's refusal of the main claim rendered further declaratory relief unnecessary.
Similar Cases
Mackie Motors (Brechin) Limited v RCI Financial Services Limited
[2023] EWCA Civ 476
Advanced Multi-Technology for Medical Industry & Ors v Uniserve Limited
[2024] EWHC 1725 (Ch)
The Motoring Organisation Limited v Spectrum Insurance Services Limited
[2024] EWHC 261 (Comm)
Cosimo Borrelli & Ors v Mutaz Otaibi & Ors
[2024] EWHC 1148 (Comm)