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Agreement on jurisdiction

In Switzerland, freedom of contract is wide-ranging. Under Art. 17 of the Civil Procedural Code [Zivilprozessordnung – ZPO], parties can even specify the local jurisdiction themselves. In some cases, this can be done in advance, in others, only once a dispute has arisen, although for some types of dispute it is precluded entirely. But in each case, the underlying legal issue must be specified.

subsidiary branch

 

A court can deal with a claim or request if it has not just local but material competence. Material competence is a prerequisite and must be officially verified by the court. This is not the case with local competence. In many cases the parties are free to agree a jurisdiction other than that provided for by law.

No exclusions
Art. 17 ZPO states that the parties to an existing or future dispute arising from a specific legal issue can agree a jurisdiction unless the law specifies otherwise. In law, this exclusion is for the most part clearly defined, but in day-to-day commercial business it is usually possible to come to an agreement on jurisdiction.

Timing of agreement
This type of agreement can be formed either before or after the onset of a dispute. This distinction is important, as there are some cases where a jurisdiction can be agreed only after the onset of a dispute. Such cases are provided for under Art. 35 ZPO. This is designed to protect what is often the weaker of the two parties, so that it cannot early on give up on the opportunity to have the dispute settled in a more favourable jurisdiction. The weaker party is usually the renting party or the consumer.

Form and specificity
For a jurisdiction agreement to be valid, it must be made in writing or in another form providing textual proof, such as email, general terms and conditions or fax. The agreement must also indicate the specific legal relationship between the parties and which court is to be competent.

Specifying the legal relationship is particularly important for large companies, which often have multiple legal relationships in place simultaneously.

 

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