Friday, November 17, 2006

Chan Chan

When two music publishers are fighting over who treated poor Cuban musicians best, one is in uncharted waters. Choice of law, forum selection clauses, and great Cuban music were in the news yesterday, in an English dispute involving two music publishers, and the music of the Buena Vista Social Club. Here is a link to the opinion.

In earlier decisions in Peer International Corp. v. Termidor Music Publishers, [2002] All ER (D) 143 (Ch. Div. 2002), aff’d, [2004] Ch. 212 (Ct. App., Civ. Div. July 1, 2, 30 2003), the court had enforced a number of different forum selection clauses. At issue were five contracts entered into in Cuba between 1930 and 1945. The signatories to the contracts were Cuban composers and a foreign music publisher. Three of the contracts picked Cuba as the forum, one was silent, and one picked New York. The contracts selecting Cuba were enforced as was the one selecting New York. The silent contract was construed as having been entered into in Cuba, and thus Cuban law applied. All this was for naught, though, since the court ended up refusing to apply a subsequent Cuban statute that had the effect of voiding the contracts. The court’s reasoning was most extraordinary: enforcing a Cuban contract under a Cuban statute according to a Cuban forum selection clause would violate English public policy. The English public policy at issue? The court held that under the principle of territoriality the copyrights at issue (the court refused to be drawn into the copyright versus contract characterization debate, having settled on construing it as a copyright matter), were English copyrights, not Cuban copyrights, and thus the Cuban government was impermissibly attempting to take away an English copyright. One may ask, though, how the forum selection clauses were enforced at all, given this conclusion? Had the contracts selected England as the forum, one might have concluded that either an English contract or (less certain) an English property right was at issue. But since the court upheld the Cuban forum selection clauses (and it certainly wasn’t repugnant to New York law for Cuba to void an English contract), it is far from apparent what this meant at the end of the day.

In the recent opinion, a copy of which I have not seen, Justice Lindsay is reported to have held that the Cuban government's take-over of the catalogue was not unlawful, but that Peer might have rights in a few works.

5 comments:

Thos said...

Surely the copyrights already belonged to Peer under the applicable laws when Fidel tried to take them back by his statute?

The principle applied by the court was that title to property is determined by the law of the situs. Is this so "extraordinary"?

William Patry said...

Thos., I don't think it is extraordinary to apply the law of the situs,but my point (which referred to the earlier opinions) concerned the validity of a forum selection clause determining what that situs is and in that respect I do think it is extraoridnary that enforcing a Cuban contract under a Cuban statute according to a Cuban forum selection clause would violate English public policy.

Anonymous said...

Here is the location of the Court of Appeal judgment: http://www.hmcourts-service.gov.uk/judgmentsfiles/j1944/peer_v_termidor.htm

I see it in this way: the Cuban publisher had to rely on a Cuban statute, passed after transfers of the UK copyright had been validly effected under any applicable law. The Cubans asked the court to derogate from the normal conflicts rule for property (law of the situs), by appealing to public policy (the contracts were oppressive). Far from applying public policy to refuse to enforce a Cuban contract, the court declined to apply public policy to disapply a normal rule of public international law.

Thos said...

Whoops! I mean: private international law...

William Patry said...

Perhaps I am dense, but if a contract says that Cuban law governs, why isn't that enforceable, including the later Cuban law?