“Waiving” the Hague Service Convention

Photo by Mateus Campos Felipe on Unsplash

Complying with the Hague Service Convention (HSC) is admittedly not always easy, quick, or even feasible. Not surprisingly, then, parties may want to work around the HSC through contractual language. John Coyle, Robin Effron, and I have previously explained how private parties can—and cannot—contract around the HSC. Unfortunately, the District of New Jersey (Judge Julian Xavier Neals) recently got this question wrong in Global Chemicals Corp. v. Indemil Industria e Comercio S.A.

From Purchase Orders to Phishing Scheme

Indemil (a Brazilian corporation) manufactures specialty chemicals, and Global Chemicals (a New Jersey corporation) wholesales and distributes such chemicals. In 2024, representatives of Global Chemicals and Indemil negotiated Global Chemicals’ purchase of $403,200 worth of a chemical from Indemil. Global Chemicals alleges it then got caught in a “homograph” phishing scheme, wiring a substantial prepayment to an impostor bank account in Vietnam after receiving lookalike email and domain communications. When Indemil insisted it had not received the payment and that Global Chemicals was forging emails, Global Chemicals sued for fraud, breach of contract, and unjust enrichment.

Indemil moved to dismiss for lack of personal jurisdiction, improper venue, and insufficient service. The district court denied the motion in its entirety based on the forum-selection clause in the purchase orders that Indemil had accepted. That forum-selection clause had remained consistent across the parties’ prior three transactions as well. It “stipulate[d] that the State and/or Federal courts located in New Jersey shall have in personam jurisdiction and venue over each of [the parties] for the purpose of resolving or litigating any dispute, controversy, or proceeding arising out of or related all transaction(s) between the Seller and the Buyer,” and it declared that “[t]he choice of New Jersey as venue for both parties is hereby stipulated as exclusive and mandatory and is not negotiable or permissive in nature, thereby excluding the possibility of litigating in any jurisdiction other than New Jersey.” The court held the clause valid and enforceable, noting that the signed purchase order had been sent from an Indemil account, not an imposter account. Indemil had thus accepted personal jurisdiction and venue in New Jersey.

So far, so good. But the more interesting (and, in my view, mistaken) part of the opinion is the court’s treatment of service of process and the HSC.

Accepting Service by Mail

Global Communications served Indemil in Brazil by mail. Indemil argued that doing so violated the HSC because Brazil, in joining the HSC, objected to service by mail under Article 10. The court overruled Indemil’s objection to service, however, based on the parties’ service-of-process clause, which provided that “[e]ach party hereby authorizes and accepts service of process … by registered or certified mail, return receipt requested, postage prepaid, to its address for the giving of notices as set forth in this Contract.” As the court noted, parties can agree in advance to methods of service—or to waive service altogether. Because Indemil had agreed to accept service by mail, the court reasoned, it had waived its right to service pursuant to the HSC.

The problem is that private parties cannot waive compliance with the HSC—the most they can do is contract around it. Article 1 of the Convention provides that it “shall apply in all cases, in civil or commercial matters, where there is occasion to transmit a judicial or extrajudicial document for service abroad.” According to the U.S. Supreme Court, “[t]his language is mandatory.” If service of process is made in Brazil, it must be made in compliance with the HSC.

As John Coyle has explained in a prior post, there are two ways parties can contract around this requirement, both of which obviate the need to “transmit a judicial or extrajudicial document” to Brazil. First, the parties can designate an agent for service of process in the United States. That enables service to be completed entirely within the United States, even if the agent subsequently informs a party in another country about the service. Second, the parties can waive service altogether. That may be ill-advised, but it does obviate the need to transmit service to another country.

Here the parties did neither: they simply agreed to a particular form of service. While parties can waive the requirements of Rule 4 as a matter of domestic law, the requirements of the HSC are binding on the United States as a matter of international law and are “mandatory” when the circumstances of Article 1 are triggered. The parties agreed to a form of service that still requires mailing that service to Brazil. Once you have “occasion to transmit” documents abroad for service, the Convention kicks in, as does Brazil’s objection to service by mail.

The Bottom Line

Agreeing to a method of service that still requires transmitting documents abroad does not amount to a waiver of service and thus does not obviate the need to comply with the HSC. If parties wish to avoid the formalities of Hague service, their best option is to designate agents for service of process within the United States, which avoids the HSC altogether.