A guide to the UPC and the UP - Flipbook - Page 467
Dispute Resolution
22-38 Closely related to the issue of governing law in an agreement is the dispute resolution clause
which sets out how disputes under the agreement will be resolved; for example, unless
disputes are to be resolved by arbitration, which court will have jurisdiction. Generally this
will only be a consideration where the parties do not request that the Court confirms the terms
of the settlement agreement by way of a decision. Where there is a decision recording the
settlement terms, any dispute relating to these terms will clearly fall within the competence
of the Court.
22-39 For obvious reasons, most agreements are drafted so that the dispute resolution clause gives
jurisdiction to a court of the same nationality as the governing law. This does not have to be the
case, however, with the most common exception being where the parties choose to make all
disputes subject to arbitration, rather than litigation. It would be highly unusual to give a court
jurisdiction to deal with disputes to an agreement which is subject to a law with which the court
is unfamiliar.
22-40 As discussed below, 50 the Court may have limited competence to hear contractual disputes.
However, to the extent that the Court does have competence, 51 the settlement agreement
could specify which division will have competence to resolve any disputes under the agreement,
as parties to a dispute may agree to bring an action relating to a Unitary patent action before
the Court division of their choice, including the central division. 52
Executing a Settlement Agreement
22-41 After the wording of a settlement agreement has been agreed by the parties it is usually only
considered finalised and binding once the document has been signed by the parties. Therefore,
care should be taken to ensure that the signatories to the agreement are the correct entities
(i.e. the parties to the dispute) and that, where an individual is signing on behalf of a company,
the individual has the proper authority to do so, in order to ensure that the agreement properly
binds the parties. Generally, this means that, where the signatory is an individual signing on
behalf of a company, they should hold a position of ‛director’ in the company that they are
signing on behalf of. However, rules on who may validly sign an agreement on behalf of a
company may be different depending on the specific laws in the country or state in which
the company is incorporated and the governing law of the settlement agreement.
Oral Settlement Agreements
22-42 Although a written settlement agreement is normally needed to show that the parties have
settled a dispute, there have been instances where, in the absence of a written settlement
agreement, parties have been considered to be bound to a settlement. The instances where
this has happened are normally very specific to the circumstances. However, a settlement
agreement is merely a particular form of contract and in many legal systems many contracts do
not need to be in writing to be valid. Indeed, the reason most contracts should be in writing is
to provide written evidence as to the terms of the contract, rather than because there is any
formal requirement that a contract needs to be in writing.
50
51
52
See paragraphs 22-48 and 22-49.
Where the parties have agreed that the Court is to have jurisdiction, the Court will be competent to hear the matter under
art.25 Brussels I Regulation (recast).
art.33(7) UPCA. For further details, see chapter 6 (Jurisdiction, Competence and Forum Shopping).
© Bird & Bird LLP | May 2023
A Guide to the UPC and the UP 457
