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Argentina

Jurisdiction of the Argentine courts

In Exportadora Buenos Aires v Holiday Inn Worldwide (October 1998, recently published), the Argentine Supreme Court rendered a landmark decision concerning the interpretation of the Argentine rules of jurisdiction over contractual disputes. In summary, in the absence of an express agreement between the parties, the Argentine courts will have jurisdiction to adjudicate claims; not only when the domicile of the defendant is located in Argentina, but also when the place of performance of any contractual party's (ie including the plaintiff's) obligation under a disputed contract is in the Republic of Argentina, regardless of whether such obligation is the one in dispute or whether this obligation has already been performed.

As a matter of background, the Argentine Civil Code expressly attributes jurisdiction to Argentine courts in the absence of an agreement to the contrary among the parties, when either the "place of performance" of a contract or the domicile of a defendant is in Argentina. The place of performance referred to in the Argentine Civil Code has traditionally been construed as the place of performance of the contractual obligation actually sought to be enforced in the lawsuit. In the Exportadora Buenos Aires case, the plaintiff (an Argentine corporation) sued Holiday Inn (a US corporation), seeking damages for the alleged non-performance of certain services by the defendant that were supposed to have been performed in the United States. The plaintiff had already performed its contractual obligations in Argentina. Under the traditional interpretation of the Argentine Civil Code, the plaintiff would have been forced to resort to the jurisdiction of the US courts, either because the US was the place where the defendant's obligations were meant to be performed or because the US was the place of defendant's domicile. The Exportadora Buenos Aires decision expands the concept of place of performance to also include the location of contractual obligations already performed and not in dispute and effectively broadens the scope of Argentine jurisdiction over contractual disputes.

The default rule set by the Exportadora Buenos Aire s decision emphasizes the importance of expressly agreeing on the jurisdiction applicable to a contract whenever the intent of the parties is to submit the contract to the courts of a jurisdiction outside Argentina.

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