An Overview on Subject Matter Jurisdiction in the Court of First Instance under Iraqi Law

Jurisdiction is divided into:

1. Territorial Jurisdiction.
2. Subject-Matter Jurisdiction.
3. Monetary Jurisdiction.

Considering that territorial jurisdiction is tied to the parties involved and is not related to the public order, it has to be brought up during the first hearing by one of the litigants. Otherwise, it is considered a waiver according to Article (74) of the Civil Procedure Code No. 83 of 1969 (“CPC”). The court does not enforce it on its own unless invoked by the other party.

As for the subject-matter jurisdiction, it is the jurisdiction of a judicial entity to hear and decide on specific cases, and it cannot be exceeded or bypassed. This jurisdiction is determined by the subject matter of the cases and the nature of the disputes. It includes disputes that fall within the competence of each court. We believe that this type of jurisdiction is the most important one because it is related to public order. 

Subject-matter jurisdiction adheres to what is specified in the law, and any agreement contrary to it is deemed null and void, whether entered into before or after the dispute. The court enforces it on its own, and this agreement does not bind the parties or the court. Due to its significance, a challenge to subject-matter jurisdiction can be raised at any stage of the proceedings, even if the first time it was raised was before the Court of Appeal or Cassation. According to Article (77) CPC. Subject-matter jurisdiction is defined in the CPC and the Law of regulating the judicial system currently in force No. 160 of 1979 (“RJS"). We shall clarify the subject-matter jurisdiction for both the Court of First Instance (“CFI”) and Court of First Instance specialized in Commercial cases (“CFICC”), to avoid confusion between their jurisdictions.

Distinguishing the Subject-Matter Jurisdiction of the CFI and the CFICC

CFI: It possesses general jurisdiction to consider all lawsuits and claims, except those explicitly excluded by a special decree. It deals with cases that do not fall within the jurisdiction of any other court. The nature of cases heard by the CFI varies. CFI has two types of subject matter jurisdiction. First cases heard by the court in its initial jurisdiction. Second, cases heard by CFI in its final jurisdiction. The reason why this distinction is important is due to the fact that the appeal process of the two types of the underlying jurisdiction is different. We will address the appeal issue further below.

According to Article (1) of Amendment No. 10 of 2016, amending Article (31) of CPC, the lawsuits that are heard by the CFI in its final degree are as follows:

1. Claims for movable debts not exceeding one million dinars.
2. Claims for the removal of joint ownership in real estate or movables, regardless of their value.
3. Eviction claims, regardless of the amount of rent.
4. Possession claims and compensation, if raised as a subsidiary claim and the compensation does not exceed one million dinars.
5. Claims for due instalments of instalment debts, not exceeding one million dinars, and the remaining debt if it is one million dinars or less. If the claim aims to prove the original debt exceeding the mentioned amount, the judgment issued is subject to appeal and cassation in the initial degree.
6. Other claims specified by laws within the exclusive jurisdiction of the Court of First Instance in its final degree.

According to Article (2) of Amendment No. 10 of 2016, amending Article (32) of CPC, the lawsuits that are heard by the CFI in its initial degree are as follows:

1. All lawsuits exceeding one million dinars in value, lawsuits subject to a fixed fee, value undetermined lawsuits, and any lawsuits not falling within the exclusive jurisdiction of the Court of First Instance in its final degree or the Personal Status Court. Its judgment is subject to appeal under the provisions of Article (185) of this law, except for cases otherwise designated as final and subject to cassation in accordance with other laws.
2. Bankruptcy suits and matters arising from bankruptcy under the provisions of the Commercial Law.
3. Company liquidation suits and matters arising from liquidation under the provisions of the Companies Law.

For cases heard by the Court of First Instance in its initial degree, they are subject to two possible appeals; the first shall be appealed to the Court of Appeal and the second shall be appealed to cassation either before the Court of Appeal in its cassation capacity or before the Federal Cassation Court. If a case falls under the final degree its judgment is subject to one cassation, either before the Court of Appeal in its cassation capacity or before the Federal Cassation Court.

CFICC: This court specializes in handling lawsuits and disputes of a commercial nature. A CFICC was established based on the Supreme Judicial Council (“SJC”) decree No. (36/Q/A) dated November 1st,2010, published in the Iraqi official Gazette No. (4169) on November 29th, 2010. The subject-matter jurisdiction of the court was determined based on decree No. (74) of 2020, relying on the provisions of Article (22) of the RJS and Article (3/Ninth) of the SJC Law No.45 of 2017.which stated that;

Firstly: The establishment of a specialized Court of First Instance in each appellate region under the name "CFICC" with jurisdiction over:

1. Commercial lawsuits where one of the parties is a non-Iraqi.
2.  Disputes related to investment contracts granted an investment license under the Investment Law No. (13) of 2006 as amended.
3. Lawsuits concerning government contracts where government entities are parties, in accordance with the instructions for executing government contracts No. (2) of 2014.
4. Urgent matters and orders related to subjects within the jurisdictions outlined in the above paragraphs (3, 2, 1).

This statement was executed as of the date of its publication on November 30th, 2020.

What Happens When Filing a Lawsuit Before the Court Lacking Jurisdiction? 

The parties, whether plaintiff or defendant, have the right to raise the defence of lack of subject-matter jurisdiction at any stage of the lawsuit. The court may, on its own initiate referral of the lawsuit to the court it deems competent.

If the referral is rejected by the referred court at the same level, for example, the CFI shall refer the case to the CFICC. The decision of CFICC is subject to appeal by the parties through a cassation appeal before the Court of Appeals in its cassation capacity within 7 days from the date of issuing the decision, according to Article (216) of CPC. The defence of lack of subject-matter jurisdiction has a significant impact on delaying procedures and the outcome of the lawsuit. before the non-specialized court. It is a preventive measure to avoid surpassing the subject-matter jurisdiction by the parties.

However, if the decision is issued by the non-specialized court, it is threatened with invalidity, consequently the lawsuit is considered null.

Bases for Raising a Jurisdiction Objection:

1. The objection to subject-matter jurisdiction must be raised in advance with a complete lawsuit, as this objection aims not to challenge the lawsuit's acceptance but to prevent the court before which the lawsuit is filed from considering it due to lacking subject-matter jurisdiction.
2. The objection must be based on a clear violation of the jurisdiction rules specified in the laws because the purpose of this objection is to protect the defendant from litigation before a non-specialized court, considering the judicial system and respecting the rules, especially when it comes to public order.
3. The objection should be presented in a clear and unequivocal form to represent the will to object to subject-matter jurisdiction, as any ambiguity or lack of clarity may lead the court where the lawsuit is filed to dismissal it.

Therefore, the subject -matter jurisdiction is a matter of public order that cannot be waived by the parties at any stage of the lawsuit, whether it is a subject-matter court or a law court, and the court must rule on it autonomously. Even if none of the disputing parties raises it, the court should still consider it.