Reimbursement of a Partial Payment from a Reinsurance Contract

Facts

X. Reinsurance AG (the appellant) is a reinsurance company domiciled in Switzerland, and Y. Limited (the respondent) is an insurance company domiciled in Bermuda. The respondent had partially reinsured its insurance risk with the appellant. Disagreements arose between the parties regarding the reinsurance coverage for the consequences of Hurricane Rita. According to the appellant, it transferred 5.75 million USD to the respondent, which the respondent only accepted as a partial payment. Thereupon, the appellant filed a lawsuit with the District Court of Höfe for the reimbursement of this partial payment. The District Court and the Cantonal Court of Schwyz declined jurisdiction, whereupon the appellant filed a complaint with the Federal Supreme Court.

Considerations

The Federal Supreme Court holds that the place of performance of the disputed contractual obligation is decisive for determining the place of jurisdiction under Art. 113 of the PILA. If, as in the present case, the invalidity of the contract is claimed due to a disagreement over a main performance obligation, the place of performance of this disputed obligation is relevant. The Federal Supreme Court rejects a further extension of the place…