A recent request for a preliminary
ruling C-590/17 Pouvin v Electricité de France from the French Cour de
Cassation raised interesting and so far unexplored questions about the
applicability of the 1993/13/EC Unfair Contract Terms Directive (UCTD) on
contracts concluded between employers and employees that are connected to but
do not fall within the employers' main business. Last week AG Bobek delivered
his Opinion on
the case.
The Facts
Claimants Mr Pouvin and his wife Ms Dijoux
entered into a mortgage loan contract with Mr Pouvin's employer, Electricité de
France (EDF). The contract contained an automatic termination clause according
to which the loan becomes immediately and in full payable if Mr Pouvin leaves
his employment. When Mr Pouvin resigned, the employer called on the loan. In
the case that followed the claimants argued that the termination clause was
unfair under the UCTD.
Questions to consider
1) Can EDF, the employer, be considered the
'seller or supplier' within Art. 2(c) UCTD given that lending is not its main
business?
2) Can Mr Pouvin, the employee and his wife (not
an employee of EDF) be considered 'consumers' under Art. 2(b) UCTD?
Can employers be considered the 'seller or
supplier'?
Relying on the wording of Art. 2(c) of the UCTD
and previous CJEU case-law AG Bobek proposed a wide interpretation to the
notion of 'seller and supplier' so as to include the employer in the present
case. Under Art. 2(c) a 'seller or supplier' means any natural or legal person
who, in contracts covered by the UCTD, is acting for the purposes relating to
his trade, business or profession.
First, AG Bobek considered the meaning of acting
for the 'purpose' of someone's trade, business or profession. He
dismissed EDF's argument that in providing the loan they did not act for the
purpose of their trade, business or profession given that lending is not their
main business. Drawing a parallel with the CJEU's earlier judgment in
C-147/16 Karel de Grote (on which we reported here)
that confirmed that complementary or ancillary services carried out in
connection with the main activity can be included into the concept of
'business, trade or profession', which defines the status of the 'seller or
supplier', AG Bobek concluded that in the present case too, the employer provided
an ancillary service that was connected to its main activity. While in Karel
de Grote the educational institution directly provided the loan to consumers,
in the present case the connection is more indirect, since the employer only
provided the loan and not the property- that had to be purchased from a third
party seller. Regardless of the indirectness of the connection, the AG argues
that the connection is not too remote to push the contract outside the scope of
the UCTD. Especially since providing loans to employees is part of the
companies' social policy that is used to attract high quality employees and as
such is essential for a running a successful business.
Second, AG Bobek argued that giving a broad meaning to the notions of
'seller and supplier' is in line with the UCTD's intention that provides for 'any'
natural or legal person acting for the purpose relating to his
trade, business or profession. Both the words of 'any' and 'relating' provide
additional strong basis for the definition to conclude that the UCTD's
intention is to include ancillary services, not just the core activities, those
that squarely fall within the 'sphere of professional competence' of the
business.
Can employees be considered 'consumers'?
The second question that AG Bobek needed to answer is whether Mr Pouvin who is an employee of EDF can be considered a consumer. Again, the AG proposed a broad interpretation of Art. 2(b).
Although one of the recitals of the UCTD
expressly excludes employment contracts from its scope, AG Bobek dismissed the
applicability of the exclusion in the present case. First of all, he contends
that the recital has no biding force and that in any way it only provides an
illustration of a sort of contracts that should be excluded because the parties
to them are not acting as 'consumers' or 'sellers or suppliers' in the sense of
the UCTD. In the present case the loan agreement does not form part of the
employment contract and does not regulate the employer-employee relationship; the
loan is merely provided in connection with the employment contract of Mr
Pouvin. Therefore, the fact that the loan was reserved only for employees
does not change the characterization of the parties as a 'consumer' or 'seller
or supplier'.
Conclusion
AG Bobek proposes the following answers:
1) Art. 2(c) of the UCTD should be interpreted as
meaning that where a company grants a mortgage loan to an employee and the
employee's spouse that is covered by a scheme only available for the employees
of the company, it is acting as a 'seller or supplier'.
2) Art. 2(b) of the UCTD is to be interpreted as
meaning that an employee of a company and the spouse of such employee, who
entered into a loan agreement with the employer to purchase a home, is acting
as a 'consumer'.
Evaluation
AG Bobek's proposed wide interpretation of the
two notions is a welcomed approach that is likely to serve the UCTD's intention to
deliver a high level of consumer protection. The Opinion is well reasoned
and the relevant connection is made between the two notions and the
UCTD's broader policy aim to protect consumers that are in a weak(er)
position compared to businesses (general inferiority vis-à-vis businesses, weak
bargaining power and information asymmetries). It is particularly interesting
to read AG Bobek's rejection on the decisive role of these rationales
in the present case. The core of AG Bobek's thinking seems to be that the
rationales are not decisive per se whether the employer acted as a seller or
supplier, and that applicability of the UCTD does not depend on a
balancing exercise between the interest of the parties, since this
has already been done by the legislator and is included in the broad wording of
the relevant provisions. These are certainly compelling arguments that
invite the reading of the relevant parts for our
readers interested in the role of the UCTD in the society (paras.
24-29).
