A disappointing judgement for an agent, the one issued in May 2022 by the Court of Appeal of Milan (Italy)[1].
Some years ago, the agent Pangea, an Italian company active in the hides and skins industry, started a lawsuit against JBS, one of their previous principals, a Brazilian company. The agent was seeking redress for the alleged infringement by JBS of their exclusive area; this had eventually led to the termination of the contract for cause, and the Italians were claiming lost commissions and a final indemnity.
It came out that JBS has acted as an agent for a couple of years, although without any specific written commitment. However, there were plenty of documentation, duly filed with the court, evidencing that JBS had been actually treating Pangea as an intermediary for their business in Italy and abroad. Namely, Pangea was expressly mentioned as “agent” in several purchase orders, and relevant confirmations. Moreover, invoices by Pangea were available, together with relevant payments by JBS on account of “agent commissions”.
The first instance court rejected jurisdiction, though; and the case ended up before the Milan appellate court. Here, the judges retained their jurisdiction (and they rightly did so, because there was no doubt that according to the EU rules a claimant may address any court of the so called “place of performance” (this being the agent’s country in case of disputes relating to a commercial agency contract).[2]
On the merits, however, the court barred any Pangea’s claims on account of the fact that no evidence was given that a commercial agency contract was ever made. This is surprising, indeed, since all the pieces of papers mentioned above could arguably be understood as evidencing such a relationship. In fact – said the appellate judges – “one can just argue, not be sure of it”. And there’s no room for assumptions, since assumptions may not be admitted pursuant to ss. 2729(2) and 2725 Italian civil code, where the law asks for written evidence (as s. 1742(2) It. Civil code does: “1. Under an agency contract, one party assumes the task of promoting the conclusion of contracts in a specified area, on behalf of the other and for remuneration, on a permanent basis. 2. The contract must be evidenced in writing. […]”). So – no agreement, no right to commissions, or indemnity whatsoever.
This is harsh. And quite disrespectful of another principle one can easily infer from the second paragraph of said article: “[…] Either party is entitled to obtain from the other party a signed document reproducing the contents of the contract, and any additional clauses. This right is non-waivable”. In other words, an oral agreement should be considered as a perfectly binding contract.
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[1] Corte d’Appello (appellate court) of Milano, decision no. 1789 of 25/02/2022.
[2] Art. 7(1)(b), second alinea, Reg. 1215/2012.
