Files and evidence bag in a crime lab, conceptual image

BGH on the legal consequences of thwarting evidence

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In legal disputes, it happens time and again that a party impedes the opponent’s presentation of evidence by thwarting evidence. In these cases, the practical question arises as to whether and, if so, with what legal consequences it can be assumed that evidence has been obstructed.

The clarifying BGH ruling of 16.11.2021 (case no. VI ZR 100/20) on the legal consequences of obstructing evidence

In a recent ruling, the Federal Court of Justice (BGH) made important findings in this regard and, in particular, eliminated a frequently encountered misconception that evidence is deemed to have been provided in the event of the obstruction of evidence. The BGH stated in its ruling of 16.11.2021 (case no. VI ZR 100/20):

“(…)

Contrary to the opinion of the appeal, however, the plaintiff is not deprived of proof of his allegations in this regard because he could be accused of obstructing evidence due to the sale of his vehicle in September 2017. Evidence can only be said to have been obstructed if the party not bearing the burden of proof culpably makes it impossible or more difficult for the opposing party bearing the burden of proof to provide evidence by destroying or withholding existing evidence or making its use more difficult (BGH, judgments of June 25, 1997 – VIII ZR 300/96, NJW 1997, 3311, juris para. 18; of June 11, 2015 – I ZR 226/13, WRP 2016, 35 para. 44 – Deltamethrin I mwN). However, by selling his vehicle, the plaintiff did not impede the defendant’s burden of proof, but at most his own. This is because he is obliged to provide evidence that his vehicle was completely and professionally repaired in accordance with the specifications of the pre-trial expert.

Apart from this, the assumption of a frustration of proof does not lead to the legal consequence claimed by the appeal. If the prerequisites for the obstruction of evidence by the opponent of the party with the burden of proof are met, the burden of proof may be eased in favor of the party with the burden of proof, which may in some circumstances go as far as reversing the burden of proof. The obstruction of evidence, on the other hand, does not mean that no evidence can be taken at all and that the submission of the party with the burden of proof would be considered proven (see BGH, judgment of June 11, 2015 – I ZR 226/13, loc. cit. para. 48 et seq. – Deltamethrin I mwN).

(…).

Rating

This judgment on the possible legal consequences of the obstruction of evidence contains the following important findings for the conduct of proceedings:

  • Obstruction of evidence refers solely to the case where the party not bearing the burden of proof makes it impossible or difficult for the other party to provide evidence.
  • If necessary, the legal consequence in favor of the party with the burden of proof may be a reduction in the burden of proof and, under certain circumstances, a reversal of the burden of proof.
  • One of the possible legal consequences of the obstruction of evidence is not that the evidence is deemed to have been provided, with the result that the disputed fact would be deemed to have been proven.

Do you have any questions?

Person filling the car with diesel at the gas station, close-up.

Guide to procedural law: Easier way to claim damages for exhaust gas manipulation – On the BGH ruling of June 26, 2023 (Ref. Via ZR 335/21)

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The article first briefly examines the background of the diesel scandal dating back to 2015 as well as the first landmark ruling of the BGH from 2020 in order to then deal with the effects of the current ECJ ruling of March 21, 2023 (Ref. C-100/21), which laid the foundations for the amended BGH case law analyzed below.

A look back at 2015

The scandal surrounding emissions manipulation by car manufacturers dates back to 2015.

At the time, it turned out that VW had installed special software in the engine control unit to generate lower nitrogen oxide values on the test bench during emissions tests. In normal driving, however, the exhaust gas purification systems were deactivated in order to improve engine performance and fuel consumption. As a result, the vehicles did not comply with the statutory emission limits in real road traffic.

It later emerged that VW was not the only manufacturer to have “cheated” its way into supposed compliance with the statutory emission limits in the manner described above (or similar).

This resulted in waves of lawsuits from affected car buyers. The lawsuits were aimed at compensation for damages, reduction of the purchase price and rescission of contracts.

On the first landmark ruling of the BGH from 2020

In its first diesel ruling of 25.5.2020 (case no. VI ZR 252/19), the BGH ruled and confirmed the lower court in this respect that the fraudulent procurement of type approvals through emissions manipulation may also constitute a direct deception of the car buyer and, if necessary, a right of the buyer to compensation, and possibly also rescission, may be considered.

The guiding principles of the judgment were as follows:

a) It is equivalent to a direct fraudulent misrepresentation of vehicle purchasers if a vehicle manufacturer, in the context of a strategic decision taken by it during engine development, deliberately exploits the guilelessness and trust of vehicle purchasers by fraudulently deceiving the Federal Motor Transport Authority and then placing the vehicles thus falsified on the market.

b) If there are sufficient indications that at least one former member of the Management Board was aware of the strategic decision taken, the defendant manufacturer bears the secondary burden of proof for the assertion that such knowledge did not exist. It is irrelevant whether the former members of the Executive Board could be named as witnesses by the plaintiff.

c) If someone is induced by conduct giving rise to liability to conclude a contract that he would not otherwise have concluded, he may suffer pecuniary loss even if the performance and consideration are objectively valuable, because the performance is not fully usable for his purposes. However, the affirmation of financial loss under this aspect presupposes that the performance obtained through the unwanted contract is not only regarded as damage from a purely subjectively arbitrary point of view, but that the public opinion, taking into account the prevailing circumstances, also regards the conclusion of the contract as unreasonable, not appropriate to the specific financial interests and thus as disadvantageous.

d) The principles of equalization of benefits also apply to a claim for intentional immoral damage pursuant to Section 826 BGB.

This initially positive-sounding ruling meant that affected car buyers faced significant hurdles on the way to possible compensation, in particular:

  • According to the ruling at the time, a claim should require intent. Even though the BGH made it easier to provide evidence, the affected parties had to prove that the company managers had knowledge – possibly also “mediated” by employees.
  • Last but not least, the buyers concerned had difficulties with the necessary proof of loss. Thus, the BGH (see guiding principle 3 above) required that “the performance obtained through the unwanted contract is not only regarded as damage from a purely subjective arbitrary point of view, but that the public opinion (…) also regards the conclusion of the contract as (…) disadvantageous”.

The “prehistory” of the new BGH case law: The ECJ ruling of 21.3.2023 (Ref. C-100/21)

The overriding European law and thus the case law of the European Court of Justice (ECJ) is of essential importance for understanding the BGH’s changed case law in favor of consumers.

In an equally recent ruling of 21 March 2023 (case C-100/21), the ECJ laid the foundations for the current BGH case law by – contrary to previous BGH case law – granting individual protection to consumers under European type approval law. Paragraph 85 of the ECJ ruling states accordingly,

“(…) that Article 18 I, Article 26 I and Article 46 of the Framework Directive in conjunction with Article 5 II of Regulation (EC) No 715/2007 must be interpreted as meaning that, in addition to general legal interests, they protect the individual interests of the individual purchaser of a motor vehicle against its manufacturer if this vehicle is equipped with an unlawful defeat device within the meaning of Article 5 II of this Regulation.”

As if that were not enough, the ECJ even derives a claim for damages in favor of the car buyer from European law if the buyer has suffered damage as a result of the defeat device. Paragraph 91 of the ECJ ruling states,

“(…) that it follows from Article 18 I, Article 26 I and Article 46 of the Framework Directive in conjunction with Article 5 II of Regulation No 715/2007 that the Member States must provide that the purchaser of a vehicle equipped with an unlawful defeat device within the meaning of Article 5 II of that regulation has a right to compensation from the manufacturer of that vehicle if the purchaser has suffered damage as a result of that defeat device (…)”

The ECJ goes even further and admonishes the Member States to ensure that consumers actually benefit from this “European right to compensation”. According to the ECJ, this includes ensuring that the hurdles for consumers to obtain such compensation are not set too high. The ECJ ruling states this in paragraphs 92 and 93:

“92In the absence of provisions of Union law on the arrangements for obtaining such compensation by the purchasers concerned on account of the acquisition of such a vehicle, it is for each Member State to determine those arrangements.

93 However, national legislation which makes it practically impossible or excessively difficult for the purchaser of a motor vehicle to obtain adequate compensation for the damage caused to him by the manufacturer of that vehicle’s infringement of the prohibition laid down in Article 5(II) of Regulation No 715/2007 is not consistent with the principle of effectiveness.”

In short, the above-mentioned ECJ ruling is an obligatory instruction to the Member States that they must ensure that claims for damages by consumers due to exhaust gas manipulations that violate European type approval law do not remain mere theory.

On the new diesel ruling of the BGH of June 26, 2023 (Ref. Via ZR 335/21)

The ruling now issued by the BGH on June 26, 2023 (Ref. Via ZR 335/21) aims to implement the aforementioned requirements of the ECJ.

As a result, the BGH has significantly lowered the hurdles for claims for damages by diesel buyers in Germany, although (see my outlook at the end of this article) it seems questionable whether the BGH has gone far enough in accommodating consumers.

According to the amended BGH case law, vehicle manufacturers may in future be liable to pay compensation even if they have “only” acted negligently.

In addition, the BGH has implemented the further requirement of the ECJ, according to which car buyers must also have an effective way of obtaining compensation, by awarding affected consumers compensation in a range of 5 to 15 % of the purchase price without the need for an expert opinion.

In detail:

EC type approval cannot exclude claims for damages

In its ruling, the BGH first of all clarifies once again that neither an EC type approval granted nor an additional certificate of conformity can be suitable to exclude a tortious claim by the car buyer from the outset.

The decisive factor is that EC type approvals and any additional certificates of conformity only have effect with regard to a specific vehicle type, but the decisive factor for a claim under tort law is whether the specific vehicle purchased is affected.

Reversal (“major” compensation) still only in the case of intentional, immoral damage

The BGH continues to hold that “major” damages can only be claimed in the event of intentional immoral damage. In the event that a buyer’s trust in the correctness of the certificate of conformity is disappointed, he cannot demand that the vehicle manufacturer takes back the vehicle and refunds the purchase price less any benefits obtained.

Although European emissions law also protects the individual car buyer against the manufacturer if the vehicle purchased is equipped with an unlawful defeat device, the BGH stated verbatim (see para. 22 of the judgment):

“Union law, as clarified by the judgment of the Court of Justice of March 21, 2023, nevertheless does not require the purchaser of a motor vehicle equipped with an unlawful defeat device to be placed in the same position as if he had not concluded the purchase contract, i.e. to include the interest in rescinding the purchase contract in the material scope of protection of Section 6 (1), Section 27 (1) EG-FGV.”

The BGH further justifies this with, among other things, the limited wrongfulness of a “merely” culpable violation of a protective law in relation to an immoral, intentional damage.

The BGH sees no requirement in EU law and the case law of the ECJ to the effect that national law must provide for a right to rescission. It refers to the fact that the ECJ only requires sanctions that must be effective, proportionate and dissuasive. It also refers to a ruling by the Supreme Court of the Republic of Austria on April 25, 2023, which – for Austria – had affirmed a claim for major damages. The BGH considers this case law to be based on modalities of national Austrian law. It then also takes from the judgment of the Supreme Court that the Supreme Court itself assumes that EU law does not require the award of large damages.

Claim for compensation for so-called differential damages due to negligent violation of EU emissions legislation

The BGH then concedes that a negligent violation of EU emissions legislation – in the form of an impermissible defeat device – can justify a claim by the car buyer for compensation for the so-called differential damage.

In this respect, the ECJ stated that the so-called declaration of conformity pursuant to Article 26(1) of Directive 2007/46/EC provides individual protection for the vehicle purchaser, which is also aimed at ensuring that the purchased vehicle complies with all relevant legal acts. According to the ECJ, the right to register the vehicle in any Member State without further technical documentation is derived in particular from the declaration of conformity.

According to the case law of the ECJ, this reasoning in turn leads to a link between the declaration of conformity and the consumer’s individual purchase decision. This in turn corresponds to the principle established by the BGH that

“a buyer purchasing a vehicle for his own use would have refrained from purchasing the vehicle if he had been aware of the risk of an operating restriction or prohibition“

(see para. 30 of the judgment).

As a result, the BGH stated (see para. 32 of the judgment):

“The interest, which is therefore protected under EU law, not to suffer a loss of assets in the sense of the difference hypothesis by concluding a purchase contract for a motor vehicle due to a violation of European emissions law by the vehicle manufacturer, is protected by Section 823 (2) BGB in conjunction with Section 6 (1), Section 27 (1) EG-FGV according to the required interpretation of EU law. (…)”

Necessity of fault on the part of the car manufacturer

The BGH continues to demand fault on the part of the car manufacturer.

The BGH concedes that the ECJ did not deal with a fault requirement. However, the ECJ – which seems questionable to me (!) – did not directly derive a claim for damages due to an unlawful defeat device from Union law, but merely demanded such a claim to be defined in more detail by the Member States. With reference to the national law of the Federal Republic of Germany, the BGH upholds the culpability requirement and has explained this (see para. 37 of the judgment):

“According to its wording, § 823 para. 2 sentence 2 BGB does not permit an obligation to pay compensation independent of fault on the part of the injuring party. Rather, according to § 823 para. 2 sentence 2 BGB, if a violation of the protective law is also possible without fault according to the content of the protective law, the obligation to pay compensation only arises in the event of fault. Even if the limits of permissible interpretation of the law are exhausted, there is therefore no question of deriving strict liability from Section 823 (2) BGB. Nothing else applies with regard to the possibility of an interpretation in conformity with EU law. According to the case law of the Court of Justice, such an interpretation of national law finds its limit in the will of the national legislator expressed in the law (ECJ, judgment of January 22, 2019 – C-193/17, NZA 2019, 297 para. 74 mwN).”

If the affected car buyer has proven the existence of an unlawful defeat device, the vehicle manufacturer still has the option of demonstrating and proving that it neither acted intentionally nor negligently failed to recognize that the vehicle did not comply with EU regulations. If the vehicle manufacturer succeeds in doing so, it will not be liable in future either! This is because German tort law always presupposes fault on the part of the tortfeasor for tortious liability. According to the BGH, the German courts cannot impose tortious liability regardless of fault, which must also be decided in accordance with the requirements of the ECJ within the framework of the applicable national law.

Necessity of a reduction in assets – differential damages always to be assumed

For negligence cases, the BGH continues to adhere to the general principle that a claim for damages requires a reduction in assets due to the disappointed investment of trust when concluding the purchase contract for the motor vehicle.

Based on the ECJ’s requirement to grant consumers an “effective claim for damages”, the BGH links the required reduction in assets to the availability of a motor vehicle at all times, which in itself has a monetary value.

With “regard to the monetary advantage of the availability of a motor vehicle at any time”, “the legal possibility of a restriction of use, which is given with the use of an inadmissible defeat device” (see para. 42 of the judgment), is sufficient to assume damage to the detriment of the car buyer.

Accordingly, the buyer of a vehicle equipped with an impermissible defeat device within the meaning of Union law always suffers damage because the availability of the vehicle is in question due to the threat of an operating restriction or operating ban.

According to the BGH, the aforementioned principle of experience applies in favor of the buyer, namely that if the vehicle had been equipped with an unlawful defeat device, the buyer would not have purchased the vehicle at the agreed price. Accordingly, the necessary comparison of assets must be based on the time at which the contract was concluded.

Amount of damage in the range of 5% to 15% of the purchase price paid

Based on the requirements of the ECJ, according to which national law must provide an effective sanction for the violation of Union law, the BGH further ruled that the individual buyer must always be granted compensation in the amount of at least 5% and a maximum of 15% of the purchase price paid, without the need for a damage assessment.

The BGH justified the estimation of damages within this range by stating that, on the one hand, a minimum amount of damages is required to ensure sufficiently effective sanctions, but on the other hand, it must be taken into account that reasons of proportionality and the cumulative effect affecting the manufacturer as a result of multiple sales require an upper limit.

The BGH explained the reasons for the estimation range in detail (see para. 72 et seq. of the judgment):

“Pursuant to Section 287 (1) sentence 1 ZPO, the trial judge must estimate the amount of the damage in his free judgment, taking into account all the circumstances. By granting the power to estimate damages, the law accepts that the result of the estimate does not fully reflect reality as long as it comes as close as possible to it. (…)

In cases where a buyer relies on the accuracy of the certificate of conformity when purchasing a motor vehicle equipped with an unlawful defeat device, the estimation of the differential damage is subject to EU law requirements. (…)

For reasons of effectiveness under EU law, the estimated damage cannot be less than 5% of the purchase price paid. Otherwise, the sanctioning of an even merely negligent infringement of Art. 5 (2) sentence 1 of Regulation (EC) No. 715/2007 would not be sufficiently effective with regard to the promotion of the objectives of Union law due to its insignificance. (…)

Conversely, damages owed solely under Section 823 (2) BGB in conjunction with Section 6 (1), Section 27 (1) EG-FGV and not also under Sections 826, 31 BGB cannot be higher than 15% of the purchase price paid for reasons of proportionality. Liability pursuant to Section 823 (2) BGB in conjunction with Section 6 (1), Section 27 (1) EG-FGV covers cases of objectively comparatively minor infringements of the law, which the legislator has merely classified as an administrative offense. In addition, liability pursuant to Section 823 (2) BGB in conjunction with Section 6 (1), Section 27 (1) EG-FGV applies to the vehicle manufacturer several times in relation to a single motor vehicle in the event of multiple sales, so that a cumulative effect can occur. (…)

According to the BGH, the exact determination within this range is the responsibility of the trial judge, who can exercise his discretionary power of estimation without having to obtain expert advice beforehand.

Outlook

This BGH ruling will not be the last on the diesel scandal.

The judgment shows the comprehensible and welcome efforts of the BGH to limit the ECJ’s interference in the regulation of tort law claims, which is in principle the sole responsibility of the Member States, to a minimum. This is particularly evident in the culpability requirement, to which the BGH adheres with seemingly “spasmodic” reasoning, although the ECJ requires every Member State to provide a claim for damages based solely on an unlawful defeat device.

Do you have any questions?

Judge gavel with Justice lawyers

ZPO guide: Submission of evidence after the taking of evidence

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The Federal Court of Justice generally sets strict requirements for the existence of the prerequisites for a rejection of a party’s submission due to delay.

In a case of practical relevance, an appellate court had conducted a taking of evidence and then, as is customary, granted the parties a certain period of time to comment on the results of the taking of evidence. Within this period, the party providing evidence referred to a witness who had not yet been named. The court of appeal wrongly disregarded this request for evidence and wrongly ruled that it was late, as the BGH found in its decision of March 23, 2021 (case no. II ZR 80/20). The reason for this is that the opportunity to comment on the results of the taking of evidence is tantamount to an indulgence in pleadings, thereby postponing the conclusion of the oral hearing.

The judgment

The BGH stated:

(…)

Article 103 (1) of the Basic Law obliges the court to take note of and consider the submissions of the parties to the proceedings. In this sense, Art. 103 Para. 1 GG in conjunction with the principles of the Code of Civil Procedure requires the consideration of significant requests for evidence. The non-consideration of a significant offer of evidence violates Article 103 (1) of the Basic Law if it is not supported by procedural law (established case law, BGH, decision of October 20, 2020 – VII ZR 577/19, NJW-RR 2021, 58 marginal no. 9 with further references).

The Court of Appeal was not permitted to reject the defendant’s request to take evidence from his wife as a witness pursuant to Section 296a ZPO.

Contrary to the opinion of the Court of Appeal, the defendant did not submit the request for evidence after the conclusion of the oral hearing. The Court of Appeal also gave the defendant the opportunity to comment on the taking of evidence and granted a deadline for written submissions, which the defendant complied with. By granting a deadline for written submissions, the conclusion of the oral hearing is extended for the affected party with regard to the admissible reply until the deadline expires (see BGH, judgment of April 21, 2015 – II ZR 255/13, NJW-RR 2015, 893 para. 12).

The timeliness of the request for evidence cannot be called into question because it would have been an inadmissible submission with regard to the time limit. The right to comment on the result of the taking of evidence also includes the right to submit new requests for evidence (BGH, judgment of October 25, 2013 – V ZR 147/12, NJW 2014, 550 marginal no. 25 with further references).

The considerations of the Court of Appeal that the defendant was obliged to submit his request for evidence earlier are irrelevant. These statements are irrelevant for the requirements of Section 296a ZPO . The extent to which these circumstances can justify a rejection of the submission of evidence on the basis of other preclusion provisions (§ 531 Para. 2, §§ 530, 296 Para. 1, § 525 Sentence 1 in conjunction with §§ 282, 296 Para. 2 ZPO) does not need to be decided here. §§ Sections 282, 296 (2) ZPO), no decision is required here because the Federal Court of Justice, as the appellate court, is prohibited from basing the rejection on provisions other than those applied by the lower court (BGH, default judgment of February 22, 2006 – IV ZR 56/05, NJW 2006, 1741 para. 12; decision of March 21, 2013 – VII ZR 58/12, NJW-RR 2013, 655 para. 11).

(…)

My rating:

The judgment must be upheld, as the assumption of delay has far-reaching consequences for the party concerned. In the present case, the Court of Appeal’s reasoning for the assumed delay was not supported by the Code of Civil Procedure. The BGH did not have to decide on other grounds for delay that the Court of Appeal had not taken into consideration.

Do you have any questions?

Europe

Guide: International Civil Procedure Law – On the suspension of the statute of limitations by bringing an action under the EU Service Regulation (EUZVO)

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The EU Service Regulation (EUZVO) regulates the transmission of judicial documents in EU legal transactions and also has considerable significance for the suspension of the statute of limitations. Although the EU Service Regulation is not new, the courts are constantly dealing with issues relating to international service. One important aspect concerns the requirements for an effective suspension of the limitation period by filing an action. If actions are filed with the court at the last minute – as is frequently and generally permissible – Section 167 ZPO applies. This reads:

“If a time limit is to be observed by service or the limitation period is to begin anew or be suspended pursuant to Section 204 of the German Civil Code, this effect shall take effect upon receipt of the application or declaration if service is effected shortly .”

“Immediately” requires the plaintiff to have done everything reasonable to ensure that service can take place as quickly as possible. An example of this is the payment of the advance on costs that is usually requested, which the plaintiff must pay immediately.

In this context, the EUTMR raised a question that the BGH dealt with not long ago in its judgment of 25.02.2021 (case no. IX ZR 156/19). In the author’s opinion, the lower court, the Higher Regional Court of Frankfurt, had previously made a clear error of judgment, which the BGH corrected in an insightful ruling on various questions of the EUTMR.

Problem description

It is about the following:

The EUTMR provides for options for the claimant with regard to the attachment of the translation of the claim (see Article 8 (1) to (3) of the EUTMR).

The plaintiff has the choice of whether or not to include a translation into the defendant’s language with the claim from the outset. The recipient can then refuse to receive the claim by returning it if he does not understand the plaintiff’s language. If the refusal of acceptance was justified, the service must be made up for with a translation. In the present case, the plaintiff had decided to enclose a translation from the outset. A very considerable period of time elapsed before service with translation was effected. This was – clearly wrongly! – The Frankfurt Higher Regional Court blamed the plaintiff for this, as the plaintiff would have had the option of initially sending the claim to the defendant without a translation and therefore more quickly.

The BGH ruling

The Federal Court of Justice convincingly rejected the opinion of the Higher Regional Court of Frankfurt regarding the effective suspension of the limitation period under the EU Regulation.

The BGH first made the following general statements with regard to the EU foreign service of process and the question of the suspension of the statute of limitations under the EU Regulation:

(…)

If a time limit is to be observed by service, this effect shall take effect in accordance with Section 167 ZPO (German Code of Civil Procedure), this effect already occurs upon receipt of the application or declaration if service is effected shortly.

(…)

It is true that the action was only served on December 9, 2016 and therefore more than eleven months after the expiry of the limitation period. However, this is harmless because service was “imminent” within the meaning of Section 167 ZPO.

(…)

This should not be based on a purely temporal approach. Rather, because service is effected ex officio, the parties should be protected from disadvantages caused by delays within the court’s business operations, as they cannot influence these delays. There is therefore no absolute time limit beyond which service can no longer be regarded as “imminent”. This also applies if there are delays lasting several months. Delays in the service procedure that are caused by incorrect handling of the matter by the court do not have to be attributed to the party who is responsible for meeting the deadline.

(…)

However, the party is responsible for delays that are not merely minor and that they or their legal representative (Section 85 (2) ZPO) could have avoided if they had conducted the proceedings conscientiously (BGH, judgment of September 12, 2019, loc. cit.). Delays are therefore attributable if the party or their legal representative has contributed to a delay in service that is not merely minor through negligent – even slightly negligent – conduct.

(…)

Measured against this, there is no delay in service caused by the plaintiff.

(…)

Pursuant to Art. 5 (1) Brussels I Regulation, the transmitting agency must inform the party requesting service (“applicant”) of the risk of a possible refusal of acceptance by the addressee of a document that is not drafted or translated (Art. 8 (1) Brussels I Regulation) into one of the languages listed in Art. 8 Brussels I Regulation. Nevertheless, it is up to the applicant to decide whether a translation of the document in question is required, the costs of which must be borne by the applicant in accordance with Art. 5 (2) of the Brussels I Regulation (ECJ, judgment of September 16, 2015 – C-519/13, Alpha Bank Cyprus, RIW 2015, 748 para. 35). In this respect, he has the right to choose.

(…)

If the party initiating service decides to effect service without translation, the rights of the addressee are protected pursuant to Art. 8 (1) of the EU Regulation by the fact that the addressee can refuse acceptance if the documents are written in a language that he does not understand and that is not the official language of the receiving state (see BGH, decision of December 21, 2006 – VII ZR 164/05, NJW 2007, 775 para. 16). The recipient is informed of this in the form in accordance with Annex II of the EU Regulation, which must be handed over to him with the service.

(…)

As an interim conclusion on the requirements for a suspension of the limitation period under the EUTMR, it can be stated that

  • the requirement of “imminent” service requires the plaintiff to contribute to undelayed service. Purely judicial omissions are irrelevant.
  • the EUTMR grants the plaintiff options for EU international service that have an influence on the (initial, possibly untranslated) service.

On the question of whether the plaintiff could be restricted in his options in order to comply with the “imminent” requirement (according to the OLG Frankfurt), the BGH then made the following appropriate statements:

(…)

The party effecting service cannot be held responsible for delays resulting from the choice of service made by him in accordance with Art. 5 and Art. 8 of the EU Regulation. However, this question has not yet been clarified by the supreme court and is disputed in the literature.

On the one hand, the literature takes the view that the applicant may not, within the framework of Section 167 ZPO, select any of the service options regulated in the EU Regulation that would lead to more than a minor delay; rather, there is an obligation to make use of the options for accelerated service to the extent that they are opened up by the EU Regulation (see Musielak/Voit/Stadler, ZPO, 17th ed, Art. 8 EuZVO para. 1; Nagel/Gottwald/Gottwald, Internationales Zivilprozessrecht, 8th ed., § 8 para. 8.67; Hüßtege/Mansel/Brand, Rom-Verordnungen, 3rd ed, Das anwaltliche Mandat im internationalen Schuldrecht, para. 45; Kern/Diehm/Diehm, ZPO, 2nd ed., section 167 para. 10; BeckOK-ZPO/Dörndorfer, 2020, section 167 para. 4; Kuntze-Kaufhold/Beichel-Benedetti, NJW 2003, 1998, 1999; Grootens, MDR 2019, 1046, 1047). On the other hand, a freedom of choice opened up by law – as here by the EU Regulation – should not be able to tighten the obligations of Section 167 ZPO (Zöller/Greger, ZPO, 33rd ed., Section 167 para. 15; Niehoff, IWRZ 2019, 232; Hess, IPRax 2020, 127, 128).

The latter view is correct. It does not constitute negligent service of process to make use of a method of service opened up by the Brussels I Regulation, even if this may delay service compared to other options. There is neither an obligation nor a duty on the part of the party effecting service to have the action served without translation.

(…)

In each individual case, the national court must ensure balanced protection of the respective rights of the parties concerned by weighing the objective of effectiveness and speed of service in the interest of the applicant against the objective of effective protection of the rights of defense of the addressee (ECJ, judgment of 8 November 2005 – C-443/03, Leffler, ECR 2005, I-09611 para. 68; order of 28 April 2016 – C-384/14, Alta Realitat S.L, juris para. 58).

This is not compatible with the argument – also taken up by the Court of Appeal – that service without translation is “not dangerous” for the applicant with regard to Article 8 (3) sentence 3 of the EU Regulation (see Fabig/Windau, NJW 2017, 2502, 2503; Grootens, MDR 2019, 1046, 1047). In this light, the applicant cannot be instructed to attempt service without translation in order to meet the deadline. The assumption of such an obligation would make this type of service the rule (see Hess, IPRax 2020, 127). However, this would not take sufficient account of the interests of either the recipient or the applicant.

On the one hand, it is not in line with the objective of the EU Regulation that the applicant always exercises his right of choice regardless of the language skills of the recipient.

(…)

Secondly, the assumption of an obligation to first attempt service without translation does not take into account the legitimate interests of the applicant. He would be obliged to take the risk of a justified refusal to accept service by the addressee in accordance with Art. 8 (1) EC Regulation even if he knows for certain that the addressee does not speak the language. If the recipient actually makes use of his right to refuse acceptance, this is disadvantageous for the applicant in several respects, which in turn result from Art. 8 (1) and (3) of the EU Regulation. A new service must be made, which in principle takes effect ex nunc for the time limits to be observed by the applicant (see Eichel, IPRax 2017, 352, 353 with further references). With regard to Art. 8 para. 3 sentence 3 Brussels I Regulation, the applicant now faces an additional risk of limitation because he cannot wait indefinitely for the new service and it is unclear how long he has to do so (see para. 26).

In addition, the refusal of acceptance results in a delay in the proceedings. This is not only due to the fact that a translation has to be prepared and the service repeated after all. Rather, the loss of time is also caused by the fact that Art. 8 para. 3 sentence 3 of the EU Regulation restricts the retroactive effect to the “relationship with the applicant”. This is because the service of the document instituting the proceedings must not lead to the expiry of time limits for the defense at the expense of the addressee as long as the latter is unable to understand the content of the document (see ECJ, judgment of 8 November 2005 – C-443/03, Leffler, ECR 2005, I-09611 para. 67 f; see also Eichel, IPRax 2017, 352, 353). Therefore, the time limit for filing a statement of defense pursuant to Art. 8 para. 3 sentence 2 Brussels I Regulation does not begin to run until the translation is served (see Rauscher/Heiderhoff, Europäisches Zivilprozess- und Kollisionsrecht, 4th ed., vol. 2, A.II.1, Art. 8 para. 24).

Restricting the right of choice provided for in Article 5(1) of the EUTMR would ultimately also mean preventing the service operator from taking the safest route. Even if he has positive knowledge of the recipient’s language skills and a translation would then be unnecessary, there is a risk that the recipient will (unjustifiably) refuse acceptance. A dispute about the legitimacy of the refusal to accept (see Geimer/Schütze/Geimer, Europäisches Zivilverfahrensrecht, 4th ed., Art. 8 EuZVO para. 9 ff) can considerably delay the proceedings. Against this background, it does not appear reasonable to require the applicant to take a course of action within the framework of Section 167 ZPO that may be associated with procedural disadvantages for him.

(…)

As a further interim conclusion, it should be noted that, according to the correct statements of the Federal Court of Justice on the requirements for an effective suspension of the limitation period under the EU Regulation

  • the plaintiff has a reasoned choice under the EUTMR as to whether he wishes to be served with or without translation,
  • service with translation is the safest way for the plaintiff,
  • the obligatory service without translation would entail unreasonable risks for the plaintiff in view of the limitation period, and
  • delivery initially without translation can ultimately lead to a significant delay in delivery.

Finally, the BGH “rounded off” by clarifying that the plaintiff is also free to decide whether to have the translation done himself or via the court. The BGH commented on this:

(…)

It also does not constitute negligent conduct of the proceedings not to provide the translation yourself but to have it commissioned by the court.

On the one hand, a plaintiff may wait until the last day before the expiry of the limitation period to file a claim without this being counted as fault (see BGH, judgment of April 7, 1983 – III ZR 140/81, VersR 1983, 661, 663; of May 18, 1995 – VII ZR 191/94, NJW 1995, 2230, 2231). On the other hand, he must then do everything reasonable to create the conditions for prompt service (BGH, decision of March 29, 2018 – III ZB 135/17, NJW-RR 2018, 763 para. 16; judgment of December 10, 2019 – II ZR 281/18, WM 2020, 276 para. 8; in each case with further references). According to the case law of the Federal Court of Justice, it is the plaintiff’s responsibility to provide all cooperation required for proper service of process; once the plaintiff has provided this cooperation, the further responsibility for the proper course of the service procedure lies exclusively in the hands of the court, whose course of business cannot be directly influenced by a plaintiff and their legal representative (cf. BGH, judgment of July 12, 2006 – IV ZR 23/05, BGHZ 168, 306 para. 20; see also BAG, judgment of August 23, 2012 – 8 AZR 394/11, BAGE 143, 50 para. 31 f). There is no legal basis for an obligation or duty on the part of the plaintiff and his legal representative to work towards the greatest possible acceleration even at this stage of the proceedings by monitoring the court’s actions. It does not arise from the relationship under procedural law because the plaintiff, for his part, has already done everything that the Code of Civil Procedure requires of him for service of process (BGH, judgment of July 12, 2006, loc. cit. para. 21; of October 1, 2019 – II ZR 169/18, juris para. 10 mwN; see also BAG, judgment of February 15, 2012 – 10 AZR 711/10, juris para. 48).

(…)”

Conclusion

The statements of the Federal Court of Justice on the suspension of the statute of limitations under the EU Regulation are to be endorsed in every respect.

The arguments to the contrary are particularly flawed by the fact that obligations and risks are imposed on the plaintiff without a legal basis. It is also difficult to see what interests of the defendant worthy of protection could conflict with this. The defendant, who does not understand a lawsuit, cannot do anything with it. The supposed attempt to speed up service is therefore futile. And even if the untranslated claim is “understood” in individual cases, the only benefit for the defendant is to learn of the claim against him some time earlier, which in most cases is hardly significant.

Please also read my article on the effectiveness requirements for EU international delivery!

Do you have any questions?

Judge gavel with Justice lawyers

“Evidence” possible through party submissions alone! – On the decision of the BGH of 10.03.2021 – Ref. XII ZR 54/20

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Everyone is probably aware that evidence in civil proceedings is essentially provided by documents, witnesses and experts.

In contrast, statements by the parties involved (party submissions) are – it is widely believed – “only” factual submissions that must first be supported by evidence if you want your arguments to be successful.

In its ruling of 10.03.2021 (case no. XII ZR 54/20), the Federal Court of Justice pointed out – as a matter of course – that the party’s submissions alone can be sufficient to support a judgment!

The BGH stated:

“The complaint against denial of leave to appeal rightly complains that the contested judgment is based on a decision-relevant violation of Article 103(1) of the Basic Law, because it failed to take the to take note of the plaintiff’s submissions relevant to the decision in the manner required by Article 103 (1) of the Basic Law and to take the evidence offered (see Senate decision of December 18, 2019 – XII ZR 67/19 – NJW-RR 2020, 392 marginal no. 8 with further references).”


“In its assessment of the plaintiff’s credibility
, the Higher Regional Court also relied on the fact that her statements regarding the in rem security for the payment, which she had made with regard to
a jointly intended marriage with the testator in 2016 under
, were not credible. In this respect, it was unable to form a conviction on the basis of the factual submissions and the personal interview with the plaintiff and thus considered the evidence incumbent on the plaintiff to be lacking. In doing so, however, it disregarded essential submissions of the plaintiff.”

“Article 103 (1) of the Basic Law obliges the court to take note of and consider the submissions of the parties to the proceedings.
In doing so,
the requirement of the right to be heard as a fundamental procedural right is intended to ensure that the decision is made free of procedural errors that are due to the failure to take note of and consider the parties’ submissions. In this sense, Article 103 (1) of the Basic Law in conjunction with the principles of the Code of Civil Procedure require that significant requests for evidence be taken into account.”

The passages quoted above from the Federal Court of Justice’s decision firstly describe the general significance of party submissions in civil proceedings.

In the following statement, the BGH then recalls a fundamental principle of civil procedure that is unknown to many:

“It is true that the Regional Court did not have to take evidence from witnesses after it had already based its conviction on the information provided by the plaintiff alone. However, if the Higher Regional Court did not want to consider the evidence of the claim made by the plaintiff to have already been established by the result of her personal interview, it either had to take and assess the additional witness evidence offered or, if it considered the witness evidence on the internal fact of the intention to marry to be insufficiently supported by circumstantial evidence, it had to point this out to the plaintiff. By failing to do so, it violated the plaintiff’s right to be heard.”

It follows that a court can base its judgment solely on the submissions of the parties! Only if it wishes to deviate from this party submission must (further) evidence be taken!

My rating:

The BGH correctly stated this principle as a matter of course because a court forms its conviction freely in accordance with the central standard of Section 286 (1) sentence 1 ZPO:

“The court must decide whether a factual allegation is to be regarded as true or not true, taking into account the entire content of the hearings and the result of any taking of evidence.”

It follows from this, of course, that the court may form its conviction as to the truth freely, i.e. without the need to take evidence, e.g. by hearing witnesses. Accordingly, it also goes without saying that the court may also base its judgment solely on the statements of one party.

Do you have any questions?