The article considers two recent decisions, one of the European Court of Justice and one of the English High Court, in which the Unfair Terms in Consumer Contracts Regulations were invoked to strike down a jurisdiction clause contained in a consumer contract. It provides some criticism of both decisions on the basis that they provide the court with a broad discretion to invalidate jurisdiction clauses and undermine contracting parties’ expectations as to the forum for the resolution of disputes. The article also considers the interface between the Regulations and the relevant provisions of the Brussels Convention on Jurisdiction and Judgments.

In June 2000 the European Court of Justice published its decision in Océano Grupo Editorial SA v. Quintero & Others, 1 which cast a cloud of uncertainty upon the validity of standard form jurisdiction clauses to which the Unfair Terms in Consumer Contracts Regulations 19992 (“the Regulations”) apply. The Regulations incorporate into English law the EC Council Directive on Unfair Terms in Consumer Contracts (“the Directive”).3 In essence, they confer on the courts a broad power to review contract terms to ensure that they are (i) fair (the fairness requirement) and (ii) written in “plain, intelligible language” (the transparency requirement). Unfair terms are defined in Reg. 5:

(1) A contractual term which has not been individually negotiated shall be regarded as unfair if, contrary to the requirement of good faith, it causes a significant imbalance in the parties’ rights and obligations arising under the contract, to the detriment of the consumer.

(2) A term shall always be regarded as not having been individually negotiated where it has been drafted in advance and the consumer has therefore not been able to influence the substance of the term.