Thursday, 4 September 2014

No delivery of EU order for payment = invalidity grounds - CJEU in joined cases eco cosmetics (C-119-121/13)

4 September 2014: CJEU judgment in joined cases eco cosmetics (C-119/13), Raiffeisenbank St Georgen (C-120/13) and Rechtsanwaltskanzlei CMS Hasche Sigle (C-121/13) 

 We have previously discussed the opinion of AG Bot in these cases on our blog (see You have been served!...). The three German cases concerned the possibility (or lack of) for a consumer to question the fact of the delivery of the order for payment after it has already been pronounced enforceable. The AG Bot argued that due to the specific character of the claims raised in this procedure of Regulation No 1896/2006 (pertaining non-contested monetary claims) and extraordinary form thereof (facilitating fast reimbursements), the defendant has to be given a real possibility of defence, which means ensuring he was properly and timely served with the order for payment. The CJEU agrees with the AG Bot that the balance between the defendant's right to defence and the claimant's interest in speedy and efficient procedure need to be observed. (Par. 37) If the defendant is not properly informed of the existence and basis of the EU order for payment issued against him, obviously he may not have all the necessary information to oppose it. (Par. 41) It has to, therefore, be established that if the defendant is not (or improperly) served the order for payment, the period for contesting the claim of Article 16 (2) never starts running, which means that even if the status of enforceability was given to the order, it may need to be invalidated. (Par. 43 and 48) Other remedies will need to be determined by national laws. (Par. 46-47) Practically speaking, if the order for payment is delivered to the defendant's address, the defendant does not contest it, so that it becomes enforceable pursuant to Article 18, the defendant may still refuse to pay and instead try to claim in front of the national court that the delivery of the order never took place. (Par. 49)

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