Case of the Day: Sbarro, Inc. v. Tukdan Holdings, Ltd.

The case of the day is Sbarro, Inc. v. Tukdan Holdings, Ltd. (N.Y. Sup. Ct. 2011). The underlying facts are not clear from the decision. Sbarro sued Tukdan Holdings, an Israeli firm, and Werner, who lived in Israel. Sbarro effected service in two ways:  by registered mail, and by personal service in Israel according to Israeli law. Tukdan and Werner moved to dismiss for insufficient service of process. The court denied the motion. On the question of service by mail, it followed the majority view, which is that Article 10(a)’s reference to “sending” documents by postal channels is a reference to service of process. Because Israel had not made a reservation under Article 10(a), and because (presumably, though the court does not spell it out) service by mail was permissible under New York law, the service by mail was proper.

The court’s discussion of the personal service under Israeli law is more tantalizing, because the court merely asserts, without discussion, that such service was authorized by Article 19 of the Convention. Article 19 provides:

To the extent that the internal law of a Contracting State permits methods of transmission, other than those provided for in the preceding Articles, of documents coming from abroad, for service within its territory, the present Convention shall not affect such provisions.

What does this mean? According to a New York appellate decision, Fernandez v. Univan Leasing, 790 N.Y.S.2d 155, 156 (App. Div. 2005), “Article 19 of the Hague Convention permits service by any method permitted by the internal laws of the country in which service is being made.” But this is ambiguous. Does it mean that the foreign state must affirmatively authorize the method of service? Or does it mean only that the method of service must not be forbidden under the foreign law? I don’t think there is a clear answer to this in the cases, but here is what Gary A. Magnarini wrote about the problem in 1988:

It has been suggested that the word ‘permits’ in article 19 should be read to mean ‘does not prohibit.’ This would be a poor standard, however. State service of process statutes, for example, which omit mail service provisions certainly do not ‘permit’ such service. But under the proposed test such a statute could possibly be interpreted as ‘not prohibiting’ mail service because of a lack of any specific provision denying its use. In light of the original purpose of article 19, courts should narrowly construe it and only allow the use of alternative service methods which foreign law specifically authorizes. Courts should not risk infringing upon the sovereignty of foreign judicial systems when the Convention otherwise provides a variety of liberal service methods.

Gary A. Magnarini, Service of Process Abroad Under the Hague Convention, 71 Marq. L. Rev. 649, 682 (1988).

But I think Rule 4(f)(2) points the other way. (Of course, the Federal Rules of Civil Procedure aren’t really authoritative when it comes to the intention of the treaty’s drafters, but on the other hand, Magnarini points out that Article 19 was included at the American delegation’s insistence, so I think a look at the Federal Rules is instructive about the American view, at least, of what Article 19 means). The Rule provides:

Unless federal law provides otherwise, an individual – other than a minor, an incompetent person, or a person whose waiver has been filed – may be served at a place not within any judicial district of the United States:

* * *

(2) if there is no internationally agreed means, or if an international agreement allows but does not specify other means, by a method that is reasonably calculated to give notice:

(A) as prescribed by the foreign country’s law for service in that country in an action in its courts of general jurisdiction;

(B) as the foreign authority directs in response to a letter rogatory or letter of request; or

(C) unless prohibited by the foreign country’s law, by:

(i) delivering a copy of the summons and of the complaint to the individual personally; or

(ii) using any form of mail that the clerk addresses and sends to the individual and that requires a signed receipt …

Rule 4(f)(2)(A) looks to law “prescribed” by the foreign law, which I take to mean specifically authorized. But Rule 4(f)(2)(C) permits other means, such as personal service, “unless prohibited by the foreign country’s law”, as long as the Convention “allows but does not specify other means.” If Article 19 required that the means of service be specifically authorized by the foreign law, then it is difficult to make sense of the purpose of Rule 4(f)(2)(C), at least in the Hague Convention context. But again, it’s not really clear that we can reason from the text of the Rule to the correct interpretation of the Convention.

The meaning of Article 19 is, I think, an open question. I will be on the lookout for more cases!

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