Tag Archives: Netherlands

Case of the Day: Stichting Shell Pensionenfonds v. Krys

The case of the day is Stichting Shell Pensionenfonds v. Krys [2014] UKPC 41. Shell, a Dutch pension fund, had invested in shares of Fairfield Sentry Ltd., a BVI mutual fund and the largest “feeder fund” for Bernard L. Madoff Investment Securities LLC, which needs no introduction. After Madoff’s arrest, Shell immediately sought to redeem its shares in Fairfield, but of course it received nothing. So Shell applied to a court in Amsterdam, its home jurisdiction, for an order attaching bank accounts of Fairfield held by Citco Bank Nederland BV, Fairfield’s asset custodian, in its Dublin branch. The Dutch court approved the attachment; everyone agreed that the Dutch court had jurisdiction over Citco. The High Court of the BVI ordered Fairfield to be wound up and appointed Krys and Lau as liquidators. Shell submitted a claim in the BVI insolvency claim but its claim was rejected. So the situation was that if Shell was allowed to litigate the merits of its claim in the Netherlands and succeeded there, then it would receive the full amount of its claim on account of the attachment, and in effect to have priority over other creditors, who could not hope for such a recovery in the BVI insolvency proceedings. Indeed, as Shell admitted, that was the point of the attachment. Krys and Lau moved in the BVI court for an anti-suit injunction enjoining Shell from prosecuting its claim in the Netherlands and requiring Shell to procure a release of the attachment. The BVI Court of Appeal held in favor of the liquidators, and Shell appealed to the Privy Council.
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Case of the Day: Midbrook Flowerbulbs Holland v. Holland America Bulb Farms

The case of the day is Midbrook Flowerbulbs Holland BV v. Holland America Bulb Farms, Inc. (W.D. Wash. 2014). Midbrook was a Dutch company that sold flower bulbs to Holland America. When a dispute arose, the parties stopped doing business in May 2000, and Midbrook later claimed that Holland Farms had failed to pay it for the 1999 harvest. Midbrook sued in the Netherlands. Holland America appeared and defended, and it asserted a counterclaim alleging that Midbrook had overcharged it. After a hearing, the Dutch court ordered Holland Farms to pay Midbrook more than $1 million, plus fees and costs. Holland Farms appealed, and the Amsterdam Court of Appeal affirmed the judgment for the most part, though it reduced the damages to approximately $960,000. The Dutch Supreme Court affirmed, and Midbrook sought recognition and enforcement of the judgment of the Amsterdam Court of Appeals in Washington State.
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Case of the Day: Republic of Ecuador v. Chevron Corp.

The case of the day is Republic of Ecuador v. Chevron Corp. (Hoge Raad 2014). The Dutch Supreme Court affirmed the BIT arbitral award against Ecuador, which arose out of Chevron’s claim that it had suffered damages on account of undue delay in the settlement of lawsuits TexPet (of which Chevron was a shareholder) had brought against Ecuador in the early 1990s. I haven’t seen a real English translation of the decision, but the main point seems to be that it was for the arbitrators to determine the scope of the term “investment” as used in the treaty, which according to the court was exceptionally broad. While this arbitration doesn’t directly relate to the Lago Agrio litigation, the gist of the decision is no doubt welcome news to Chevron.
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