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Law School Case Brief

Volkswagenwerk Aktiengesellschaft v. Schlunk - 486 U.S. 694, 108 S. Ct. 2104 (1988)

Rule:

The Hague Service Convention is a multilateral treaty that was formulated in 1964 by the Tenth Session of the Hague Conference of Private International Law. The Convention revised parts of the Hague Conventions on Civil Procedure of 1905 and 1954. The revision was intended to provide a simpler way to serve process abroad, to assure that defendants sued in foreign jurisdictions would receive actual and timely notice of suit, and to facilitate proof of service abroad.

Facts:

After his parents were killed in an automobile accident, respondent Herwig Schlunk filed a wrongful death action in an Illinois court, alleging that defects in the automobile designed and sold by Volkswagen of America, Inc. (VWoA), in which the parents were driving, caused or contributed to their deaths. When VWoA's answer denied that it had designed or assembled the vehicle, respondent amended his complaint to add as a defendant petitioner Volkswagen Aktiengesellschaft (VWAG), a German corporation which is the sole owner of VWoA. Respondent attempted to serve the amended complaint on VWAG by serving VWoA as VWAG's agent. Filing a special and limited appearance, VWAG moved to quash the service on the grounds that it could be served only in accordance with the Hague Service Convention, 20 U.S.T. 361, and that respondent had not complied with the Convention's requirements. The court denied the motion, reasoning that VWoA and VWAG are so closely related that VWoA is VWAG's agent for service of process as a matter of law, notwithstanding VWAG's failure or refusal to appoint VWoA formally as an agent. The court concluded that, because service was accomplished in this country, the Convention did not apply. The Appellate Court of Illinois affirmed, ruling that the Illinois long-arm statute authorized substituted service on VWoA, and that such service did not violate the Convention.

Issue:

Did the Hague Service Convention apply when process is served on a foreign corporation by serving its domestic subsidiary, which, under state law, is the foreign corporation's involuntary agent for service?

Answer:

No

Conclusion:

The United States Supreme Court agreed with the lower court's conclusion that because service was accomplished within the United States, the Hague Service Convention did not apply. it was held that (1) for purposes of determining what is "service abroad" under the Convention, the Convention generally applies if the internal law of the forum country defines the applicable method of serving process as requiring the transmittal of documents abroad as a necessary part of the service; (2) under this standard, the Convention did not apply to Schlunk's attempt to serve process on the VWAG by serving the corporation's domestic subsidiary (VWoA), which, under Illinois law, was the German corporation's involuntary agent for service of process, because (a) there is no evidence in the Convention's negotiating history that the Convention was meant to apply to substituted service on such a subsidiary when service was not required abroad under the forum's internal law, (b) where service on a domestic agent is valid and complete under both state law and the due process of the Federal Constitution's Fourteenth Amendment, the Supreme Court's inquiry ends and the Convention has no further implications, (c) thus, even if, as a practical matter, VWoA was certain to transmit the process documents to VWAG, whatever internal, private communications took place between an agent and a foreign principal were beyond the Supreme Court's concerns, and (d) the due process clause does not require an official transmittal of documents abroad every time there is service on a foreign national.

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