Could Oasis sue in the UK after a German concert organiser refused to pay the full fee for Oasis minus Noel?
Who: Definitely Maybe (Touring) Ltd and Marek Leiberberg Konzertagentur GmbH (“MLK”)
Where: Queen’s Bench Commercial Court, London
When: 30 March 2001
German concert organisers who thought they had booked Oasis to appear live at two festivals were disappointed when one, not two of the Gallagher brothers showed. Unfortunately the festivals coincided with a disagreement between the pop superstars which led to the non appearance of lead guitarist Noel Gallagher. MLK refused to play the balance of the appearance fee and Oasis’s loan-out company Definitely Maybe (“DM”) sued for it in the English court. Perhaps surprisingly the appearance contract said nothing about which country’s law should apply to the contract or which country’s courts should adjudicate in any dispute, but MLK argued that German law should apply and that the German courts should adjudicate. On appeal from a High Court Master’s decision against MLK, Morison J agreed with MLK, holding that although DM’s principal place of business was England, the circumstances as a whole indicated quite clearly that the contract was most closely connected with Germany. One factor was that the German court would be better placed to decide what negative impact, if any, the absence from Oasis of Noel Gallagher would have on the value to MLK of the band performing live in Germany.
Why this matters:
Perhaps the more surprising aspect of this case is that at first instance, the court’s verdict went against the German concert organisers. The place of performance of the principal obligation under the contract (or “characteristic performance” in Euro-speak) clearly pointed to German law being applicable under the Rome Convention, (which deals with applicable law). There is also the Brussels Convention (dealing with which EU country’s courts should sit in judgement on a dispute) that defendants should normally be sued in their own country. As ever, all this cost and legal debate could have been avoided if the parties had included a suitable clause in the original contract. No matter if the majority of your contracts are with English companies, (remember here that even dealing with a Scottish company creates the possibility of a different law applying and different courts dealing with disputes) it is advisable to include a governing law and jurisdiction provision in all contracts.