Domestic Waiver Obviates Need for Service Abroad

Rockefeller Tech. Inv. (Asia) VII v. Changzhou Sinotype Tech., Ltd., No. S249923 (Cal. Apr. 2, 2020)

Back in 2018, the Court of Appeal vacated an arbitration award entered by default. The defaulting defendant agreed in a contract to service by FedEx. But the Court of Appeal ruled that FedEx service was nonetheless impermissible, because the defendant was in China and China objected to Article 10 of Hague Service Convention, which permits service through postal channels. As I said back then, the reasoning of the case seemed somewhat overbroad. Evidently, the California Supreme Court agreed, as it granted review and here reverses the Court of Appeal.

Indeed, the Supreme Court seems to have found the Court of Appeal’s decision even more overbroad then I did. In a unanimous opinion by Justice Corrigan, the Court discerns three principles out of the U.S. Supreme Court’s Hague Convention jurisprudence. First, the Hague applies only to “service of process in the technical sense,” i.e., to the process for formal delivery of whatever documents the lexi fori—the law of forum jurisdiction—determines are required to establish jurisdiction and notice. Second, whether there is occasion for transmission of documents for service abroad is also a lex fori issue. And third, if foreign service of process is required, that service must comply with the Hague.

Here, the analysis doesn’t need to get past step two. Service of process fulfills two roles. It is required for a court to establish personal jurisdiction over the defendant. And it is required to afford the defendant notice of the proceedings. But under California law (and the law of every U.S. jurisdiction I’m aware of) a party can consent to both personal jurisdiction and the form of notice, even it would not otherwise satisfy statutory or constitutional standards. Both California and federal cases recognize that such consent can be obtained in a pre-dispute contract. 

Here, Defendant consented to personal jurisdiction in California when it agree to arbitrate its claims under the pertinent contract in a JAMS-administered arbitration in LA. See Code Civ. Proc. § 1293. It also consented to notice by FedEx as adequate “service of process.”  Indeed, with regard to arbitrations, the Code of Civil Procedure specifically recognizes that arbitration initiating documents can “be served in the manner provided in the arbitration agreement for the service of such petition and notice.” § 1290.4(a).

Thus, because, under California law, formal service was unnecessary based on the parties’ agreement, there was no occasion to transmit service of formal process abroad. That being the case, the Hague is not implicated.

Court of Appeal reversed.