Author: Kelly Lentz
UvA ID: 10846956
Master thesis supervisor: Dr. Joasia Luzak
European Consumer Law
What is the impact of the CJEU’s case law
regarding the adjustment of unfair contract
terms on consumer protection?
A comparative study of Belgium and the Netherlands
LLM European Private Law 2014-2015
Universiteit van Amsterdam
INTRODUCTION ... 2
CHAPTER 1: THE ADJUSTMENT OF UNFAIR CONTRACT TERMS FROM A EUROPEAN PERSPECTIVE ... 3
Section 1: The Unfair Contract Terms Directive ... 3
§1: Ratio legis ... 3
§2: The unfairness test ... 5
§3: The sanction ... 5
Section 2 : The CJEU’s case law ... 8
§1: Banco Español de Crédito [2012] and Asbeek Brusse [2013] ... 8
§2: Árpád Kásler [2014] ... 11
§3: Unicaja Banco and Caixabank [2015] ... 13
CHAPTER 2 : ANALYSIS OF THE BELGIAN AND DUTCH LEGAL SYSTEM ... 15
Section 1 : Belgium ... 16
§1: The Belgian contract law requirements ... 16
§2: Consequences of the CJEU’s case law for Belgian law ... 19
Section 2 : The Netherlands ... 21
§1: The Dutch contract law requirements ... 21
§2: Consequences of the CJEU’s case law for Dutch law ... 24
CHAPTER 3 : INFLUENCE ON CONSUMER PROTECTION ... 27
Section 1 : Impact on consumer protection ... 27
§1: Consistency ... 27
§2: Legal certainty ... 28
§3: Effectiveness ... 32
Section 2 : Recommendation for the future ... 33
CONCLUSION ... 36
Introduction
1. – Standard terms can be beneficial to both contracting parties, the professional and the
consumer, on the condition that they strike a fair balance between them. However, this is not always the case in practice due to the economic and informational superiority the professional enjoys. Therefore, the Unfair Contract Terms Directive1 (hereafter: UCTD) aims to prevent the use of unfair standard terms by allowing the Member States to sanction the professional for using such terms.
Article 6(1) of the UCTD provides that unfair contract terms should not be binding on the consumer. This sanction is designed to give the consumer an adequate and effective protection whilst discouraging the professional from using unfair contract terms.2 However, the sanction of unfair contract terms suffers some shortcomings, which will be pointed out in this thesis.
2. – The Court of Justice of the European Union (hereafter: CJEU) has recently rendered
several judgments concerning the adjustment of unfair contract terms. I am of the opinion that the adjustment of unfair contract terms does not constitute a sanction, because it does not penalize the professional for using unfair contract terms. In addition, I believe that the adjustment of unfair contract terms would not grant the consumer effective and adequate protection and is therefore not compliant with the purpose of the UCTD. For these reasons, I decided to analyse the CJEU’s case law regarding the adjustment of unfair contract terms, in order to examine its impact on consumer protection within the European Union. In this sense, this legal research thesis intents to answer the following question: What is the impact of the
CJEU’s case law regarding the adjustment of unfair contract terms on consumer protection in Belgium and in the Netherlands?
3. – In order to find an answer to this question, the UCTD and the CJEU’s recent case law
regarding the adjustment of unfair contract terms will first be analysed (Chapter 1). Thereafter I will examine the Belgian and Dutch legal systems as a case study on how national law addresses the problem of adjusting unfair contract terms. Therefore, I will analyse the legal situation in Belgium and the Netherlands before the CJEU rendered its judgements regarding the adjustment of unfair contract terms as well as discuss how complying with the CJEU’s case law will affect the national law in the two countries, respectively (Chapter 2). I chose
1 Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts, O.J. 1993, L 095/29 – 34. 2 Preamble 24 of the UCTD.
these two Member States because I have Belgian nationality and I studied Belgian law at university. In addition, the Dutch legal system regarding the adjustment of unfair contract terms is very interesting and quite different from the Belgian one. Furthermore, I have a detailed knowledge of the Belgian legal system as well as the personal interest and language skills needed for research in Dutch law.
The last chapter will evaluate how this case law influences consumer protection regarding the legal certainty of the consumer. Thanks to this study I will be able to assess whether the CJEU’s case law affects the predictability of the consumer’s rights and obligations under the contract. Another criterion I will consider is whether the sanction of unfair contract terms is effective, in the sense that it discourages the professional from using unfair contract terms. Finally, on the basis of my findings, I will consider whether such a jurisprudential development is desirable within the framework of consumer protection that the UCTD aimed to achieve. Furthermore, in order to overcome a number of pitfalls of the UCTD I will recommend how the sanction of unfair contract terms should be interpreted to best serve the consumer’s interest.
Chapter 1: The adjustment of unfair contract terms from a
European perspective
Section 1: The Unfair Contract Terms Directive
§1: Ratio legis
4. – Standard terms fulfil an important role in today’s national and international trade because
they allow parties to structure their contract in a simple way. Due to the fact that the parties do not have to negotiate about every contractual detail, they can conclude contracts faster and at lower cost. In order to facilitate this, the legislative regulation of standard terms should be as cautious as possible.3
Although freedom of contract and party autonomy are the basic principles of contract law, these freedoms are subject to restrictions, particularly, if these freedoms are monopolized by
3
M.B.M. LOOS, Algemene voorwaarden. Beschouwingen over het huidige recht en mogelijke toekomstige
one contracting party with higher bargaining power. This party is then able to impose identical contractual conditions on a large number of consumers who find themselves in an inferior position because of the lack of economic power and incentives to enforce their own terms.4
In this sense, Lord Reid in the prominent English case Suisse Atlantique justifies the need to regulate standard terms as follows: “In the ordinary way the customer has no time to read {the
standard conditions}, and if he did read them he would probably not understand them. And if he did understand and object to any of them, he would generally be told he could take it or leave it. And if he then went to another supplier the result would be the same”.5
Therefore the European legislator has regulated standard terms by combining two supporting theories. The first theory, the abuse theory, protects the consumer as a weaker party against the abuse of power of the professional contract partner. The seller or supplier enjoys economic, intellectual and psychological superiority, which results in a stronger bargaining power and may lead to abuses.6 The second theory, the transaction cost theory, is based on the assumption that by drafting the terms once for several transactions, the professional can save transaction costs, whereas for the consumer it is very expensive to acquire sufficient information for negotiations on the conditions of the transaction. The informational asymmetries and unequal distribution of transaction costs justifies legislative intervention to regulate standard terms.7
5. – The European legislator has ascertained that the consumer protection against unfair
contract terms differs significantly from country to country. This divergence between the different legal systems is detrimental to the establishment of the internal market, as it might lead to a distortion of competition between professionals, especially if they seek to market their goods or services in Member States other than their own.8 In addition, the consumer
4 H-W. M
ICKLITZ, J. STUYCK, E. TERRYN, Cases, Materials and Text on Consumer Law (Ius Commune
Casebooks for the Common Law of Europe series), Hart Publishing 2010, 279. 5
House of Lords, Suisse Atlantique SA v. Rotterdamsche Kolen Centrale, A.C., 1967, (361), 406, in S. STIJNS,E. SWAENEPOEL, “Evolutiepolen van de onrechtmatige bedingenleer”, DCCR, 2013, 143.
6 G. S
TRAETEMANS, “De invloed van een onerlijke handelspraktijk op de consumentenbescherming van de
Richtlijn oneerlijke bedingen”, DCCR, 2014, 23.
7 S. S
TIJNS,E.SWAENEPOEL, op.cit., 142-145; H-W.MICKLITZ,J.STUYCK,E.TERRYN, op.cit., 280.
8
COM 248 final, 27 April 2000, Report from the Commission on the implementation of Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts, 9; Preamble 2 of the UCTD: “Whereas the laws of Member States relating to the terms of contract between the seller of goods or supplier of services, on the one hand, and the consumer of them, on the other hand, show many disparities, with the result that the national markets for the sale of goods and services to consumers differ from each other and that distortions of
generally does not know the rules of law which govern their consumer contracts in other Member States which might deter him from concluding cross-border contracts.9 Therefore, in 1993 the UCTD has been adopted, with, inter alia, the aim to approximate the laws of the Member States relating to unfair terms in contracts that are concluded between a seller or supplier and a consumer (Article 1(1) of the UCDT) in order to improve the functioning of the internal market.10
§2: The unfairness test
6. – Before analysing the sanction of unfair contract terms, it is important to stress when and
how the European legislator qualifies a contractual term as unfair. First, the UCTD only applies to standard terms, defined as terms in contracts that have not been individually negotiated.11 Second, the test of unfairness is regulated in Article 3(1) of the UCTD and provides that a contractual term is unfair if it (a) causes a significant imbalance in the parties’ rights and obligations arising under the contract which is (b) to the detriment of the consumer and (c) contrary to the requirement of good faith.12 In addition, Article 4(1) gives some guidelines as to the assessment of unfair contract terms and obliges the judge by assessing whether a term is unfair to take all circumstances concerning the conclusion of the contract into account.13 Finally, the Annex of the UCTD contains an indicative and non-exhaustive list of terms which may be regarded as unfair (Article 3(3)).14
§3: The sanction
competition may arise amongst the sellers and suppliers, notably when they sell and supply in other Member States”.
9 Preamble 5 of the UCTD: “Whereas, generally speaking, consumers do not know the rules of law which, in
Member States other than their own, govern contracts for the sale of goods or services; whereas this lack of awareness may deter them from direct transactions for the purchase of goods or services in another Member State”; S.WEATHERILL, EU consumer law and policy, Cheltenham, Edward Elgar Publishing, 2013, 146.
10 P. W
ERY, “Les clauses abusives relatives à l’inexécution des obligations contractuelles dans les lois de
protection des consommateurs du 14 juillet 1991 et du 2 août 2002”, JT, 2003, 799.
11
Article 3(1) of the UCTD; See also Article 3(2) of the UCTD: “A term shall always be regarded as not individually negotiated where it has been drafted in advance and the consumer has therefore not been able to influence the substance of the term, particularly in the context of a pre-formulated standard contract.
The fact that certain aspects of a term or one specific term have been individually negotiated shall not exclude the application of this Article to the rest of a contract if an overall assessment of the contract indicates that it is nevertheless a pre-formulated standard contract.”
12 See also C.M.D.S. P
AVILLON, “Wat maakt een beding oneerlijk? Het Hof wijst ons (eindelijk) de weg”, TvC,
2014, n°4, 163-172.
13 Article 4(1) of the UCTD: “Without prejudice to Article 7, the unfairness of a contractual term shall be
assessed, taking into account the nature of the goods or services for which the contract was concluded and by referring, at the time of conclusion of the contract, to all the circumstances attending the conclusion of the contract and to all the other terms of the contract or of another contract on which it is dependent.”
14
H.BEALE et al. (eds.), Ius Commune Casebooks for the Common Law of Europe, Cases, Materials and Text on
7. – Under Article 6(1) of the UCTD, unfair terms shall not be binding on the consumer and
the contract shall continue to bind the parties upon those terms if it is capable of continuing in existence without the unfair term.
The European legislator has deliberately chosen a broad and neutral term (“not binding”), which transcends the different legal traditions of the Member States, with the intention to leave the Member States enough room for implementing the sanctioning of unfair contract terms.15 According to TENREIRO it is entirely the decision of the Member States to determine the appropriate legal consequences of unfair contract terms. However, the sanctions imposed must be suitable to give the consumer an effective and adequate protection as well as to discourage professionals from using unfair terms in their contracts.16 In order to achieve these two objectives, TENREIRO believes that national rules should respect the following features.
The sanction of unfair contract terms should be non-judicial, in the sense that no previous judicial intervention is needed to declare the unfair term not binding. With the view to protect the consumer effectively it is crucial that he cannot give up his right to invoke the unfairness of a term and that he can use this right at any time from the conclusion of the contract. In addition, the judge is obliged to assess the unfairness of a standard term ex officio, and to sanction unfair terms with retroactive effect on its own motion.17 However, we will see in Chapter 2 that not all Member States have included these features into their national laws, which grants the consumer different levels of protection from one country to another.
8. – In my view, TENREIRO correctly expresses how Article 6(1) of the UCTD should be interpreted to achieve the desired practical effect: ensure that unfair terms are not binding on the consumer. Nevertheless, his paper does not consider any thoughts about a possible adjustment of unfair contract terms. In order to grant the consumer effective protection, from my point of view the question whether any adjustment of unfair contract terms would be compatible with their “non-binding” nature must be answered. In my opinion the answer is negative.
The ratio legis of the UCTD is to provide the consumer with effective and adequate protection. The adjustment of unfair contract terms would not grant the consumer the same protection as that resulting from its non-application. In addition, the Directive should
15
S. STIJNS, “Zijn onrechtmatige bedingen nietig?”, in Liber amicorum Yvette Merchiers, K. BERNAUW,PH. COLLE,M.DAMBRE,I.DEMUYNCK (eds.), Brugge, die Keure, 2001, 921, n° 7-11; P. WERY, op.cit., 807.
16 M. T
ENREIRO, “The Community Directive on Unfair Terms and National. Legal Systems. The Principle of
Good Faith and Remedies for Unfair Terms”, ERPL, 1995, 281-283.
discourage traders from using unfair terms in their contracts. If the judge could revise the content of an unfair term this would undermine the dissuasive effect of the Directive, as the trader would not be encouraged to draft his standard terms in a fair way. I believe that the adjustment of unfair contract terms does not constitute a sanction at all, because it does not penalize the professional for using unfair contract terms. Moreover, the adjustment of unfair contract terms may even influence the unfairness test. The judge might be more tempted to declare a standard term unfair in order to revise it and re-establish the balance in the rights and obligations of the parties instead of declaring it unfair and non-binding. However, it is not the aim of the UCTD to grant the trader any protection, even if the performance without the unfair term can be detrimental to him.18 On the other hand, the UCTD does not go as far as to protect the consumer unnecessarily, as this would grant “the consumer with a more beneficial position than the one that equal parties usually have on the market.”19 The Directive is only aimed at correcting the imbalance between the bargaining positions between the trader and the consumer which might be affected by the adjustment of unfair contract terms.20 In light of these considerations, I believe that the adjustment of unfair contract terms is not compliant with the aim of the UCTD.
9. – The open wording of the Directive leads to differing implementations of the sanctions for
unfairness of standard contract terms in the Member States.21 Some Member States22 opted for absolute nullity, which implies that the unfair term is automatically null and void. Other Member States23 preferred relative nullity, according to which the unfair term initially remains valid as long as the consumer invokes its non-binding or invalid character. Finally, in some Member States24 the exact legal consequences of unfairness was or is still controversial,
18
Ibid.
19 J.A.LUZAK, “Unfair commercial practice ≠ unfair contract term ≠ void contract - AG's opinion in case
C-453/10 Pereničová and Perenič”, available at http://recent-ecl.blogspot.nl/2011/12/unfair-commercial-practice-unfair.html; See Considerations 32 and 36 ECJ judgment of 15 March 2012, C-453/10 - Jana Pereničová,
Vladislav Perenič v. SOS financ spol. s r. o., [2012] ECR 144.
20 The Scottish Law Commission, “Unfair terms in consumer contracts: A new Approach?”, A Joint Issues
Paper, 2012, 74 available at:
http://www.scotlawcom.gov.uk/files/6113/4313/5057/Unfair_Terms_in_consumer_contracts_issues.pdf
21 M. E
BERS, Consumer Law Compendium, München, Sellier, 2008, 404.
22 Bulgaria, Estonia, Germany, Ireland, Portugal, Romania, Slovakia, Slovenia, Spain. In Malta, France and
Luxembourg unfair clauses are non-existent which is similar to absolute nullity in M. EBERS, op.cit., 407
23
Czech Republic, Latvia, the Netherlands in M. EBERS, op.cit., 407.
24 Austria, Belgium, Cyprus, Greece, Italy in M. E
especially in view of the CJEU’s case law, which is not always easy to align with national law.25
10. – Before turning to the CJEU’s case law it needs to be stressed that the whole contract
continues to bind the parties as long as this is possible, excluding the unfair term, according to the purpose and legal nature of the contract. Thus, the non-binding effect is limited to the unfair term.26
Section 2 : The CJEU’s case law
11. – As a result of the term “not-binding”, not being very technical in a legal sense, the CJEU
has rendered several judgments concerning the interpretation of the consequences of unfair contract terms. Due to the limited scope of this thesis, I will focus exclusively on the CJEU’s case law relating to the possible adjustment of unfair contract terms.
§1: Banco Español de Crédito [2012] and Asbeek Brusse [2013]
12. – On 14 June 2012, the CJEU rendered the case of Banco Español de Crédito27 which concerns two questions referred to a preliminary ruling. The first question relates to the obligation of the judge to test a standard term ex officio.28 Concerning the second question, the national judge asked whether a national judge can adjust the content of an unfair contract term instead of declaring it not-binding.29 The dispute had arisen between Banco Español de Crédito SA and its customer, Mr Camino, who failed to pay the monthly repayments under a consumer credit agreement. The bank initiated proceedings before the Spanish courts in order to claim the repayment of the loaned amount plus interest and costs. Under the consumer
25 H-W.M
ICKLITZ,J.STUYCK,E.TERRYN, op.cit., 299; M. EBERS, op.cit., 407.
26 M. E
BERS, op.cit., 406.
27
ECJ judgment of 14 June 2012, C-618/10 - Banco Español de Crédito SA v. Joaquín Calderón Camino, [2012] ECR 349 (hereafter: Banco Español de Crédito).
28 Consideration 57 Banco Español de Crédito; In this judgment the CJEU confirms its previous case law by
imposing the duty of national courts to assess the unfairness of standard terms on its own motion; See also: ECJ judgment of 27 June 2000, Joined Cases C-240/98 to C-244/98 - Océano Grupo Editorial SA v. Murciano
Quintero [2000] ECR I-04941; ECJ judgment of 21 November 2002, C-473/00 - Cofidis v. Fredout, [2002] ECR
I-10875; ECJ judgment of 26 October 2006, C-168/05 – Elisa María Mostaza Claro v. Centro Móvil Milenium
SL,[2006] ECR I-10421; ECJ judgment of 4 June 2009, C-243/08 – Pannon GSM Zrt v. Erzsébet Sustikné Gyorfi, n.y.r.; ECJ judgment of 9 November 2010, C-137/08 - VB Pénzügyi Lízing Zrt. v. Ferenc Schneider, [2010] ECR I-10847.
29 Considerations 37 and 58 Banco Español de Crédito: The Spanish Court asked whether Article 6(1) of the
UCTD precludes legislation of a Member State, such as that laid down in Article 83 of Legislative Decree 1/2007, which allows a national court, in the case where it finds that an unfair term in a contract concluded between a seller or supplier and a consumer is void, to modify that contract by revising the content of that term.
credit agreement the rate of interest on late payments was set at 29%. The Spanish court, after having declared this standard term unfair, wished to reduce the unfair interest rate for delayed payment from 29% to 19%.30
13. – In order to answer the second question the CJEU referred to the wording of Article 6(1)
as well as to the objectives and overall scheme of the provision in question. With regard to the literal interpretation, even if Article 6(1) grants the Member States a certain degree of autonomy it nevertheless expressly requires that unfair terms “shall not be binding on the consumer”. The Directive does not mention any possibility of “adjustment” of unfair contract terms. It therefore follows that national courts have the obligation to exclude unfair terms so that they do not produce binding effects on the consumer. However, they are not authorized to revise the content of an unfair term in such a way to make this standard term fair. The contract must continue to bind the parties, in principle, without any amendment other than that resulting from the deletion of unfair terms, in so far as, according to the national rules, such continuity of the contract is legally permissible.31
Furthermore, this interpretation of the sanction of unfair contract terms is confirmed by its short and long term objective. While its short-term purpose is to prevent consumers from being bound by unfair contract terms, the long-term purpose of Article 6(1) is to prevent continued use of unfair terms in Business to Consumer (B2C) contracts.32 If national courts could revise the content of unfair terms this would undermine the deterrent effect of the UCTD. The seller or supplier would remain tempted to use unfair terms, “especially since he would have nothing to lose by attempting to impose his terms on the consumer”33
, because the contract would stay valid due to the revision of the unfair term by the national judge. If this power was to be granted to national courts, it would not ensure efficient protection of the consumer compared to the non-application of unfair terms.34
30 P. R
OTT, “Case note on Banco Español de Credito v Joaquín Calderón Camino“, ERCL, 2012, 475 ; J.P.
CORREA DELCASSO, Observations C.J.E.U., 14 June 2012, Ius & actores, 2013, 139-147; G. PAISANT, “L'élargissement, par la CJUE, du pouvoir d'office du juge et le refus de la révision d'une clause déclarée abusive”, La Semaine Juridique - édition générale, 2012, nº 37, 1638.
31 Consideration 65 Banco Español de Crédito. 32 J.A. L
UZAK, “Unfair terms in consumer credit agreements – AG of the CJEU in Camino (case C-618/10)”,
available at http://recent-ecl.blogspot.it/2012/02/unfair-terms-in-consumer-credit.html; See also: Article 7.1 of the UCTD: “Member States shall ensure that, in the interests of consumers and of competitors, adequate and effective means exist to prevent the continued use of unfair terms in contracts concluded with consumers by sellers or suppliers”.
33
Opinion Advocate General TRSTENJAK, par. 88.
34 Consideration 70 Banco Español de Crédito ; E. P
For these reasons, the CJEU came to the conclusion that Article 6(1) of the UCTD does not allow national courts to revise the content of an unfair contract term in a consumer contract instead of merely setting aside its application to the consumer.35
14. – On 30 May 2013, the CJEU in the Asbeek Brusse case36 had the chance to confirm its previous case law. The answer to the third question - whether Article 6(1) of the UCTD allows a national court to reduce the amount of an unfair penalty clause, as it is authorized to do by the national law and as the consumer has requested37- is almost literally taken over from the Banco Español de Crédito case. Like in the previous case, the CJEU excludes the possibility of national courts to mitigate the amount of an unfair penalty clause. The reasoning of the CJEU remains the same: the Directive has among others the objective to bring to an end unfair contract terms in B2C contracts. If the judge could revise the content of an unfair term, this “would be liable to compromise attainment of the long-term objective of Article 7 of the directive, since it would weaken the dissuasive effect on sellers or suppliers of the straightforward non-application of those unfair terms with regard to the consumer.”38 In conclusion, the CJEU affirms that national courts are required to exclude the application of unfair terms in its entirety with regard to the consumer and are not allowed to reduce the amount of the penalty imposed on the consumer by that clause, merely, as it is authorised by national law.39
15. – These two judgments directly influence European consumer law and especially the
rights and obligations of the consumer, the professional and the courts. Firstly, these judgments, in my view, increase the legal certainty and predictability for the consumer as his rights and obligations will not depend on the discretionary power of the judge who might mitigate unfair contract terms. Consequently, the national courts see their judicial power restricted in the sense that they can only exclude the application of unfair terms and are not
35 Consideration 71 Banco Español de Crédito.
36 ECJ judgment of 30 May 2013, C-488/11 - Dirk Frederik Asbeek Brusse and Katarina de Man Garabito v. Jahani BV., [2013] ECR 341 (hereafter: Asbeek Brusse).
37 Consideration 54 Asbeek Brusse. 38
Consideration 58 Asbeek Brusse.
39 F. P
EERAER, “Ambtshalve matiging van overdreven schadebedingen blijft uitgesloten”, RDCB, 2014, 627; C.
LEONE, “Unfair terms, ECJ reaffirms important principles”, available at http://recent-ecl.blogspot.nl/2014/05/core-and-price-terms-and-their.html; G. COENE, Observations Gent, 5 December 2012,
allowed to revise them even if a specific national legislation authorised it. Finally, the consequences of these judgments for the professional are of primary importance, since these judgments strengthen the sanction of unfair contract terms. The trader cannot try anymore to include unfair contract terms in a consumer contract presuming that the judge would reduce the unfair part in order to save the contract.40 Therefore he has to carefully think about the content of his standard terms and exclude any risk taking, what likewise increases the effectiveness of the consumer protection.
16. – I will analyze the impact of this case law on national consumer law in Chapter 2.
However, it is important to stress at this point that this case law is highly interesting as it may have led to changes in national laws which previously allowed judges to replace unfair contract terms with other, more consumer-friendly terms. In addition, it may raise new questions, especially, whether the objective of the Directive is compatible with national laws which allow a judge to apply national law after having declared an unfair term not-binding to fill a gap that appeared in the contract.41
§2: Árpád Kásler [2014]
17. – The facts of the CJEU’s Árpád Kásler case42 can be summarized as follows. In May 2008, several borrowers concluded a mortgage loan contract denominated in foreign currency secured by a guarantee in rem with the Jelzálogbank. The dispute had arisen because of a standard term which allowed the bank to calculate the amount of the due loan on the basis of the buying rate of Swiss Francs - at the day when the contract was concluded-, whereas the monthly repayment instalments were based on the currency’s selling rate, which is usually higher.43 After declaring this standard term unfair, the question arose whether the national judge could replace this unfair term by applying default legal rules.44 The answer is positive.
40
However, we will see that the CJEU’s in the Árpád Kásler case (see, infra n°17-18) allows the national judge some flexibility to “adjust” - by deleting the unfair term and substituting it with a default legal rule - unfair contract terms if the whole contract (and not only a contractual clause) is at risk. See Consideration 85 ECJ judgment of 30 April 2014, C-26/13 - Árpád Kásler, Hajnalka Káslerné Rábai v. OTP Jelzálogbank Zrt, [2014] ECR (hereafter: Árpád Kásler).
41
C. LEONE, “Unfair terms, ECJ reaffirms important principles”, op.cit.; F. PEERAER, “Het volledige verbod op
herziening van onrechtmatige bedingen: de botte fijl van het Hof van Justite?”, TBBR, 2013, 325.
42 ECJ judgment of 30 April 2014, C-26/13 - Árpád Kásler, Hajnalka Káslerné Rábai v. OTP Jelzálogbank Zrt,
[2014] ECR.
43
C. LEONE, “Core and price terms, and their transparency: CJEU in Kásler (C-26/13)”, available at http://recent-ecl.blogspot.nl/2014/05/core-and-price-terms-and-their.html
44
“Default rules fill the gaps in incomplete contracts; they govern unless the parties contract around them” in contrast to mandatory rules that parties cannot change by contractual agreement, in I. AYRES,R. GERTNER, “Filling Gaps in Incomplete Contracts: An Economic Theory of Default Rules”,Yale L.J, 1989, 87.
The CJEU first repeats the reasoning of the Banco Español de Crédito case in the following respects. That, firstly, Article 6(1) of the Directive must be interpreted as precluding national law which allows adjusting the contract by revising unfair contract terms. That, secondly, the power of the judge to adjust unfair contract terms would be liable to eliminate the dissuasive effect of the Directive. Finally, that Member States should provide adequate and effective means to prevent the continued use of unfair terms in B2C contracts.45
However, in cases such as the one at issue, Article 6(1) does not preclude the national court from deleting the unfair term and substituting it with a default legal rule. Indeed, replacing the unfair term would lead to a situation in which the contract may continue in existence what the purpose of the UCTD justifies. If it were not possible to replace the unfair term, the contract would be null in its entirety, which might expose the consumer to unfavourable consequences. The dissuasive effect for traders not to use unfair contract terms could be jeopardised when the whole contract were annulled and it was not the trader but the consumer who suffered as a result thereof.46 It is important to stress that, in principle, the annulment of a loan contract triggers the outstanding amount of the loan becoming immediately due, which might expose the consumer to financial difficulties. Consequently, this would “penalise the consumer rather than the lender who, as a consequence, might not be dissuaded from inserting such terms in its contracts”.47
Taking the forgoing into account, the CJEU came to the conclusion that Article 6(1) allows a national judge to replace the unfair contract term by substituting it with a supplementary provision of national law, if otherwise the B2C contract cannot continue in existence after the unfair term has been deleted.48
18. – The factual context of this case is of paramount importance to understand the answer of
the CJEU, which is not contradictory, contrary to what one may believe at first glance to the answer given in the Banco Español de Crédito case. The substitution mechanism in the Árpád
Kásler case, allows for national default rules to replace the unfair term, whereas in the Banco
case, the judge mitigated the interest rate for late payment on its own discretion from 29% to 19%. The discretionary power of the judge, which is at stake in the Banco Español de Crédito case, affects the legal certainty of the consumer protection to a higher extent than applying default legal rules. By replacing the unfair term with default legal rules, the rights and
45 Considerations 77-79 Árpád Kásler. 46 Considerations 80-83 Árpád Kásler. 47 Consideration 84 Árpád Kásler. 48
Consideration 85 Árpád Kásler.; D. BERLIN, “Obscurité des clauses contractuelles… et de la directive”, La
obligations of the consumer are more predictable in comparison to the adjustment of standard terms based on the discretionary judgement of the national court.
In addition, in the Árpád Kásler case, leaving the unfair clause unreplaced would cause the contract’s nullity in its entirety – which was not the case in the Banco Español de Crédito case – because the contract could not continue in existence without the unfair term. The annulment of the loan agreement would provoke the outstanding amount to be due immediately, which is detrimental to the consumer and therefore against the purpose of the Directive.49 As the CJEU expressed on various occasions, the aim of Article 6(1) is to “substitute for the formal balance established by the contract between the rights and obligations of the parties real balance re-establishing equality between them”.50
Moreover, the CJEU’s interpretation is consistent with the method used in the Aziz case to assess the unfairness of a contractual term, by taking into account what legal rules would apply in the absence of a contractual agreement in that regard. This comparative analysis allows the national court to evaluate whether the contract places the consumer in a legal situation less favourable than that provided for by the national law in force.51 It thus follows that the substitution mechanism provided by the Árpád Kásler case aimed to re-establish the suggested equality by applying legislative provisions instead of contractual ones. After all, contractual terms based on provisions of national law should be able to guarantee equality between parties’ rights and obligations.52
§3: Unicaja Banco and Caixabank [2015]
19. – The last important judgment regarding the adjustment of unfair contract terms in
consumer contracts has been delivered by the CJEU in a number of joined cases in January 2015.53 The Spanish law reform establishes a ceiling on the default interest recoverable through the enforcement of a mortgage. This ceiling grants the judge the power to recalculate the default interests, if they are higher than three times the statutory rate of interest. In the present case Unicaja Banco and Caixabank brought their enforcement proceedings before the
49
E. POILLET, “Droit de la consommation”, J.D.E., 2014, 302.
50 Consideration 31 ECJ judgment of 15 March 2012, C-453/10 - Jana Pereničová, Vladislav Perenič v. SOS financ spol. s r. o., [2012] ECR 144.
51 Conisderation 68 ECJ judgment of 14 March 2013, C-415/11- Mohamed Aziz v. Caixa d´Estalvis de Catalunya, Tarragona i Manresa (Catalunyacaixa), [2013] ECR 164.
52
E. POILLET, op.cit., 2014, 303.
53 ECJ judgment of 21 January 2015, C-482/13 - Unicaja Banco SA v. José Hidalgo Rueda a.o., (C-484/13) Caixabank SA v. Manuel María Rueda Ledesma a.o, 485/13) Caixabank SA v. José Labella Crespo a.o.,
(C-487/13) Caixabank SA v. Alberto Galán Luna and Domingo Galán Luna, [2015] ECR 21 (hereafter: Unicaja
Spanish judge and the question arose whether this Spanish provision is compatible with Article 6(1) of the UCTD.54
The CJEU, first of all, noted that, according to the Spanish judge, the default interest clause in the mortgage-loan contract at issue is unfair in the light of the UCTD. In line with the CJEU’s previous case law, national courts are required to exclude the application of an unfair contract term so that it does not produce binding effects on the consumer. In particular, the national courts are not allowed to revise the content of unfair terms, as this would eliminate the dissuasive effect of the UCTD and not provide adequate and effective means to prevent the continued use of unfair terms in B2C contracts.55
Moreover, the CJEU followed AG WAHL’s opinion56, who distinguishes the present case from the Árpád Kásler case, as the annulment of an unfair default interest clause does not have detrimental consequences for the consumer. As a result, the substitution mechanism of Árpád
Kásler cannot be applied in this case, as the amounts for which the mortgage enforcement
proceedings have been brought will necessarily be lower without the default interest clause. 57 However, as MAK, in my view, correctly examined, the annulment of the default interest
clause might affect the existence of the mortgage contract as the bank will not receive any interests anymore, which may constitute an essential part of the mortgage contract.58 Following MAK’s interpretation, the Árpád Kásler substitution mechanism would then apply
in order to safeguard the existence of the contract.
In second place, the CJEU stated that the Spanish provision applies to all mortgage-loan contracts alike, irrespective of whether they fall within the scope of the UCTD or not. It thus follows, that the Spanish ceiling and the possibility to recalculate the default interest does not prevent the court from assessing the unfairness of the default interest clause in a B2C contract.59 This implies that the national judge is obliged to assess and, in case of an unfair default interest clause in a B2C contract, to exclude this clause, regardless of whether the default interest rate is more or less than three times the statutory rate of interest.60
54
C. MAK, “Spanish mortgages continued – AG Wahl’s opinion in cases Unicaja Banco and Caixabank”,
available at http://recent-ecl.blogspot.nl/2014/10/spanish-mortgages-continued-ag-wahls.html
55 Considerations 27-32 Unicaja Banco and Caixabank. 56
Consideration 30 Opinion of Advocate General Wahl delivered on 16 October 2014, joined cases C-482/13, C-485/13 and C-487/13.
57 Consideration 34 Unicaja Banco and Caixabank. 58
C. MAK, “Spanish mortgages continued – AG Wahl’s opinion in cases Unicaja Banco and Caixabank”, op.cit. 59
Consideration 36 Unicaja Banco and Caixabank.
Therefore, the CJEU concluded that Article 6(1) of the UCTD does not preclude Spanish law, which obliges the judge to recalculate default interest whose rate is more than three times greater than the statutory rate provided that its application “(i) is without prejudice to the assessment by the national court of the unfairness of the term and (ii) does not prevent that court removing the clause if it were to find the latter to be unfair within the meaning of the directive”.61
One should bear in mind that the CJEU distinguishes between standard terms that fall within the scope of the UCTD and are unfair on the one hand, and contract terms that either fall outside the scope of the Directive or are not to be considered as unfair under the Directive on the other hand. Regarding the first one, consumers are protected by Article 6(1) of the UCTD which excludes the application of unfair terms. As concerns the latter one, Spanish Law protects debtors, and also consumer-debtors, by providing a ceiling on default interest rates.62
20. – The impact of this case law on consumer protection will be evaluated in Chapter 3 (see, infra n°40-56). A number of issues will be highlighted here, especially how this case law may
influence consumer protection as it may be difficult for the consumer to assess in advance under which of the two regimes their contract term falls. Indeed, the consumer has to anticipate the judge’s assessment of the unfairness of the contractual clause in order to assess whether the term under the UCTD is unfair and excluded or, on the contrary, fair and might be reassessed. Furthermore, the judge could be tempted to assess the standard term to be fair with the intention of revising it instead of annulling it under Article 6(1) of the Directive.63
Chapter 2 : Analysis of the Belgian and Dutch legal system
21. – The CJEU is competent to interpret the UCTD and it is for the national courts to apply
this interpretation to the specific facts of individual cases.64 The UCTD pursues minimum harmonization which allows Member States to keep or introduce more protective consumer
61 Consideration 43Unicaja Banco and Caixabank; CJEU Press Release No 9/15, Luxembourg, 21 January 2015,
available at: www.curia.europa.eu
62 C. M
AK, “Spanish mortgages continued – AG Wahl’s opinion in cases Unicaja Banco and Caixabank”, op.cit. 63
Ibid.
64 The Scottish Law Commission, op.cit., 80; See also J.S. E
STEVE, “Effective judicial protection in consumer
protection in the ECJ’s case law”, available at: http://ssrn.com/abstract=2526709; N. GAVRILOVIC, “The Unfair
Contract Terms Directive through the Practice of the Court of Justice of the European Union: Interpretation or Something More?”, ERCL, 2013, 177.
rules.65 Hence, the standard of consumer protection might differ from one country to another. For this reason, it is crucial to analyze how the Member States have implemented this Directive in order to find out what the impact of the CJEU’s case law regarding the adjustment of unfair contract terms on consumer protection is. Due to the limited scope of this thesis, I chose the Belgian and Dutch legal system as a case study on how national law addresses the problem of adjusting unfair contract terms in B2C contracts.
Section 1 : Belgium
22. – The Belgian implementation of the UCTD has been subject to considerable criticism66
because of the great number of sector-specific Acts.67 This fragmented transposition makes it very difficult for consumers to gain an overview of the protection against unfair contract term because it undermines coherence of the rules.68
Recently, the Belgian legislator adopted the Code de droit économique69(hereafter: CDE) which assembled all these different legislation into one Act.70
§1: The Belgian contract law requirements
23. – Under Belgian law the consumer benefits from a higher protection than under the
UCTD. The Belgian provisions do not only apply to standard terms, but fairly to all contractual clauses, whether pre-formulated or individually negotiated.71
The sanction of unfair contract terms has been implemented into Article VI. 84 of the CDE: “Any unfair term is null and void. The contract shall continue to bind the parties upon those terms if it is capable of continuing in existence without the unfair terms.”72
65
Article 8 of the UCTD.
66 See M.E
BERS, op.cit., 435 for further explanations.
67 Examples of national legislation which implemented the UCTD : Act of 14 July 1991 on trade practices and
consumer information and protection; Act of 2 August 2002 on misleading and comparative advertising, unfair contract terms and distance marketing in respect of professional services; Act of 6 April 2010 on market practices and consumer protection.
68 M.E
BERS, op.cit., 433 ; T. BOURGOIGNIE, “La transposition de la directive 93/13/CE dans le droit belge : un processus (très) évolutif et (trop) confidentiel”, in The integration of Directive 93/13 into the national legal systems, 1999, 84 available at :
http://ec.europa.eu/consumers/archive/cons_int/safe_shop/unf_cont_terms/event29_01.pdf
69 Code de droit économique, 28 February 2013, M.B., 2013, 19975; entered into force 31 May 2014. 70 See for further explanations E. P
IETERS, “La codification du droit économique – bref aperçu, premier bilan et
quelques perspectives d’avenir”, in A. TALLON, Le nouveau code de droit économique, Bruxelles, Larcier, 2014, 9-36.
71 M.E
BERS, op.cit., 352.
72
Article VI.84 CDE : “Elk onrechtmatig beding is verboden en nietig. De overeenkomst blijft bindend voor de partijen indien ze zonder de onrechtmatige bedingen kan voortbestaan”.
24. – When transposing Article 6(1) of the Directive, the Belgian legislator has decided to
maintain the concept of nullity, well-known in Belgian contract law. The nullity of an unfair contract term is in principle a partial nullity of the contract. The sanction only affects the unfair contract term, which will be excluded, but the contract continues to bind the parties.73 This clarification is important, otherwise the consumer’s right to claim the nullity of the unfair term would be undermined by fear that the whole contract would be null and void. It also prevents the seller or supplier from withdrawing from the whole contract.74
A consequence of this partial nullity is that if a contract term is unfair and thus null, national law will apply to substitute any gaps in the contract.75 For instance, if a penalty clause is unfair and null, the contract remains valid between the parties and the professional still has the right to claim compensation based on the “real damage” by applying default legal rules (Article 1149 and 1153 of the Belgian Civil Code).76 Only if the contract cannot exist without the unfair term the judge pronounces the nullity of the contract in its entirety. This is the case if the unfair term forms the essential part of the contract, which is rarely the case in practice.77 This was the situation in Belgium before the CJEU rendered its recent case law analyzed in this thesis. It is questionable whether applying default legal rules after declaring a contract term null is still compatible with the aim of Article 6(1) of the UCTD (see, infra n°28-30).
25. – Nevertheless, it should be pointed out that applying default legal rules is not the same as
adjusting unfair contract terms. Whereas the first concept is allowed under current Belgian law, subject to approval of the CJEU’s case law (see, infra n°28-30), the latter is not. Belgian law does not grant the judge the power to revise unfair contract terms in order to make them more consumer-friendly. The judge cannot replace the unfair clause by a new one which would not be based on the agreement of the parties.78 The only sanction provided by article VI.84 of the CDE is the nullity of the unfair term.79
73 Gent, 6 April 2005, Jaarboek handelspraktijken, 2005, 336. 74 S. S
TIJNS, E. SWAENEPOEL, op.cit., 151; P. CAMBIE, Onrechtmatige bedingen, Gent, Larcier, 2009, 430; I. CLAEYS, “Nietigheid van contractuele verbintenissen in beweging”, in J. LEYSEN (ed.), Sancties en nietigheiden, Brussel, Larcier, 2003, 267, n° 53-63; R. STEENNOT, Onrechtmatige bedingen in de wet van 6 april 2010
betreffende marktpraktijken en consumentenbescherming, Mechelen, Kluwer, 2012, 249. 75
Rb. Hoei, 27 March 2006, T.App, 2007, 48; Gent, 4 January 2012, NJW, 2012, 70.
76 P. C
AMBIE, “Onrechtmatige bedingen: voortaan kleine lettertjes met grote gevolgen?”, Jb.Markt, 2011, 255;
Luik, 21 February 2005, J.L.M.B., 2006, 526 ; Gent, 9 April 2008, Jaarboek Handelspraktijken, 2008, 203.
77 R. S
TEENNOT, op.cit., 248.
78 P. WÉRY, Droit des obligations. Volume I. Théorie générale du contrat, Bruxelles, Larcier, 2010, 305. 79
S. JANSEN,S.STIJNS, “De basisbeginselen van het contractenrecht: kroniek van de recentste evoluties”, TBBR,
26. – In the past there have been considerable discussions about the relative or absolute nature
of this nullity.80 The Belgian’s highest court, as well as the majority scholars, are in favor of the relative character of the nullity.81 Yet, it is clear that this choice only partially responds to the features of the sanction of unfair contract terms described by TENREIRO82 and thus to the objectives of the European Directive. Hence, in case of relative nullity the Belgian judge cannot grant on its own motion the nullity of the unfair contract term. In addition, the nullity can only be pronounced by a court and the consumer cannot simply refuse to honor the obligations imposed by an unfair term while the annulment has been pronounced by a judge. Consequently, the Belgian transposition of Article 6(1) of the UCTD does not satisfy the purpose of this article, which is that unfair contract terms are not binding.83
However, the CJEU’s case law in Océano Group, Cofidis, etc.84 has been followed by the Belgian Cour de Cassation’s decision of 26 May 2005, so that the clear distinction between relative and absolute nullity has been distorted. Since then, Belgian law contains a case of relative nullity regarding unfair contract terms that obliges the judge to grant the nullity of unfair contract terms on its own motion.85 This solution has already been proposed by some Belgian scholars86 even before the CJEU’s decision in Océano Group. “Therefore, it could be said that the CJEU’s case law may only have reinforced an evolution that was taking place in Belgium anyway.”87
27. – In 2008, the Belgian Commission of Unfair Contract Terms (hereafter: C.O.B.)
suggested a new draft of sanctioning unfair contract terms in order to achieve the objectives of
80
R. STEENNOT, op.cit., 240; E. SWAENEPOEL, “De onrechtmatige bedingen : evolutie naar het ambtshalve
opwerpen van de relatieve nietigheid?”, DCCR, 2005, 66.
81 E. S
WAENEPOEL, S. STIJNS, P.WERY,“Onrechtmatige bedingen - Clauses abusives”, D.C.C.R. 2009, 189; Cass., 26 May 2005, Pas., 2005, 1115; M. DUPONT, “Nullité absolue et nullité relative”, in La nullité des
contrats, C.U.P., 2006, 54-55. 82 M. T
ENREIRO, op.cit., 281-282.
83 E. S
WAENEPOEL, S. STIJNS,P.WERY,op.cit., 189; L. DE ZUTTER, “Le juge face aux clauses abusives : à la
croisée du droit des obligations et du droit judiciaire”, Ann.dr.Louvain, 2011, n°2, 174 ; P. CAMBIE,
Onrechtmatige bedingen,op.cit., 400.
84 ECJ judgment of 27 June 2000, Joined Cases C-240/98 to C-244/98 - Océano Grupo Editorial SA v. Murciano Quintero [2000] ECR I-04941; ECJ judgment of 21 November 2002, C-473/00 - Cofidis v. Fredout, [2002] ECR
I-10875.
85C.C
AUFFMAN, “The Impact of EU Law on Belgian Consumer Law Terminology”, ERPL, 2012, 1348. 86
E. SWAENEPOEL, S. STIJNS,P.WERY,op.cit., 192 : They suggest that the traditional clear distinction between
relative and absolute nullity remains valid and that we ought to rethink the concept of relative nullity in case of unfair contract terms. This relative nullity has from now on a characteristic of absolute nullity in consumer law: the obligation of the judge to sanction unfair contract terms ex officio; L. DE ZUTTER, op.cit., 185.
87 C.C
Article 6(1) of the UCTD as well as creating a sanction which is independent of the national concept of nullity.88
The C.O.B. suggested that at least the following elements should be included in the draft: - that unfair contract terms shall not be binding on the consumer without judicial intervention; - that the rights and obligations of the consumer which were unfairly regulated shall be governed by general law in order to safeguard the “survival” of the contract;
- that the judge acts on its own motion if necessary in order to protect the consumer effectively.
The C.O.B. formulated in this sense a law proposal which unfortunately has not been approved by the Belgian legislator.89
§2: Consequences of the CJEU’s case law for Belgian law
28. – After the CJEU rendered its judgments in Banco Español de Crédito and Asbeek Brusse,
Belgian scholars discussed how this case law may influence current Belgian law. PEERAER90
lists three possibilities to exclude unfair contract terms from the contract: - via revision or reduction, which is excluded by the CJEU;
- via nullity and replacement by substituting it with a supplementary provision of national law, sanction proper to Belgian law;
- via nullity without replacement by substituting it with a supplementary provision of national law.91
This last sanction is unknown under Belgian law, but PEERAER and other Belgian scholars
deduced from the CJEU’s wording in preceding judgments that this is possibly the sanction the CJEU prefers.92 Although the CJEU does not explicitly answer the question whether the national judge can apply national law to substitute any gaps in the contract, the wording used
88 C.O.B. nr. 25, 19 November 2008, “Advies inzake de regeling van onrechtmatige bedingen in het voorontwerp
van wet betreffende bepaalde marktpraktijken”, in B. PONET (ed.), Commissie voor Onrechtmatige Bedingen:
Voorstelling, werkzaamheden en wetgeving,De Boeck-Larcier, Gent, 2010, 211.
89 P. C
AMBIE, “Onrechtmatige bedingen: voortaan kleine lettertjes met grote gevolgen?”, op.cit., 252. 90 F. P
EERAER, “Het volledige verbod op herziening van onrechtmatige bedingen: de botte fijl van het Hof van
Justite?”, op.cit., 324.
91 S. G
EIREGAT, “Het beding van stilzwijgende verlenging en de opzegmogelijkheden na die verlenging in het
licht van het Koninklijk Besluit Vastgoedovereenkomsten en de Europese rechtspraak over oneerlijke bedingen”,
DCCR, 2015, 120. 92 Ibid.; F. P
EERAER, “Het volledige verbod op herziening van onrechtmatige bedingen: de botte fijl van het Hof
van Justite?”, op.cit., 324-325; P. CAMBIE, “Onrechtmatige bedingen: voortaan kleine lettertjes met grote
by the Court in those judgments seems to exclude any form of substitution.93 “That contract must continue in existence, in principle, without any amendment other than that resulting from the deletion of the unfair terms”.94
29. – Before going into further detail, it is useful to examine under which circumstances a
contract contains legal gaps, which eventually could have been filled by default rules. Under general contract law, legal gaps arise when “the parties have failed to provide for a contingency which they would have covered had they thought of all the problems which might arise as the contract proceeded”.95
In such a case, the omissions can be filled by default rules which have been developed by the national legal systems for the very purpose to fill such gaps.96 However, in our case the situation is different as the contract becomes incomplete due to the annulment of the unfair term. The fact that the unfair term has been removed might indicate a legal gap if it is a matter of dispute. Nevertheless, in many cases and especially in consumer contracts it is not obvious what a contractual gap means. Is there a legal gap if the annulled term was necessary for the parties? Or could we say that a legal gap already arises if the annulled term was desirable for one of the contracting parties? Unfortunately, there is no clear answer in legal literature or legislation. It is often a matter of judicial interpretation under which circumstances the contract contains a legal gap, which in turn affects the legal certainty of the contracting parties.97
30. – In conclusion, the consequences of unfair contract terms are still developing. Previously,
under Belgian law the judge declared an unfair contract term as null and applied default legal rules in order to fill a possible gap. However, he was not entitled to adjust the unfair term and thereby to step into the shoes of the parties. With the Banco Español de Crédito and Asbeek
Brusse case this exclusion was approved by the CJEU. Nonetheless, in these two cases the
CJEU did not expressly answer the question whether the application of default legal rules was also excluded. By the wording of these judgments can be assumed that the Belgian judge is not allowed anymore to apply default rules. The fact that the Árpád Kásler case must be seen as an exception to be relevant only if the contract cannot exist without the unfair term and exposing the consumer thereby to great inconvenience, also confirms the CJEU’s decision
93 F. P
EERAER, “Het volledige verbod op herziening van onrechtmatige bedingen: de botte fijl van het Hof van
Justite?”, op.cit., 325.
94
Consideration 65 Banco Español de Crédito
95 H.B
EALE et al. (eds.), op.cit., 667. 96 Ibid.
97 P.C
SERNE, “Policy considerations in contract interpretation: the contra proferentem rule from a comparative
law and economics perspective”, paper to be presented at the 3rd ISLE conference Milan, 9-10 November 2007, 2.
that default legal rules cannot fill the gap caused by a non-binding term.98 Therefore, Belgian law has to review its legal theory and practice in order to fully respect the CJEU’s case law.
Section 2 : The Netherlands
§1: The Dutch contract law requirements
31. – In the Netherlands most European consumer law directives have been implemented into
the Dutch Civil Code (hereafter: BW). This is also the case for the UCTD which was transposed into Book 6 BW, the law of obligations.99
The sanction of unfair contract terms is regulated under Article 6:233 BW and concerns only standard terms defined as terms pre-worded for a multitude of contracts.100 This provision provides that an unfair term is merely voidable.101 This means that the legal act remains in principle valid, until the weaker contracting party invokes its avoidance. Avoidance of unfair contract terms can be done either extra-judicial (Article 3:50 BW) or by a decision of the court (Article 3:51 BW).102 In contrast, under Belgian law the sanction of unfair contract terms is judicial, in the sense that only the judge can declare unfair contract terms null and void. Dutch law seems to be more consumer-friendly than Belgian law on this point, since the Dutch consumer does not have to introduce a court procedure in order to not be bound by the unfair contract term.103
98 M.J.S
ORENSEN, “Sanctions on Unfair Terms in Consumer Contracts. The Danish Example”, EUVR, 2014, 229.
99
M.B.M. LOOS, “The influence of European consumer law on general contract law and the need for
spontaneous harmonization”, Centre for the Study of European Contract Law, Working Paper Series, No. 2006/02, 4; J.W. RUTGERS, “Kroniek van het Europees privaatrecht”, NJB, 2014, 800.
100 M.E
BERS, op.cit., 351.
101
Article 6:233 BW: A stipulation from the applicable standard terms and conditions is voidable:
a. if it is unreasonably burdensome for the counterparty, having regard to the nature and content of the contract, the way in which these standard terms and conditions have been formed, the interests of each party, as evident to the other, and the other circumstances of the case;
b. if the user has not given his counterparty a reasonable opportunity to take knowledge of the content of the applicable standard terms and conditions.
All the English translation of the Dutch Civil Code are available at: www.dutchcivillaw.com
102 W.L. V
ALK, “Tekst & Commentaar Burgerlijk Wetboek, Vernietigbaarheid beding in algemene voorwaarden
bij: Burgerlijk Wetboek Boek 6, Artikel 233 [Vernietigingsgronden]”, Kluwer, 2014, 3.
103 P. C
32. – Similar to the Belgian distinction between relative and absolute nullity, the clear
distinction under Dutch law between “voidable” and “void”104 legal acts has been softened as a result of the CJEU’s case law105
. In presence of a B2C contract, the consumer is no longer required to invoke the avoidance of the unfair standard term before the court. Provided that the counterparty is a consumer, the judge must, after assessing the standard term ex officio as unfair, exclude the application of this term on its own motion.106
33. – Dutch law distinguishes between partial nullity, reduction and conversion. It is
important to first explain these concepts in order to find out whether the CJEU’s case law affected these mechanisms (see, infra n° 35-39).
Like in Belgian law, the nullity of the unfair contract term resulting from a consumer avoiding this term on the basis of article 3:49 BW107 is a partial nullity based on article 3:41 BW.108 The nullity is restricted to the unfair contract term, unless there is an indissoluble link between the unfair contract term and the remaining part of the contract in which case the whole contract would be null. In principle, there are no objections against the application of partial nullity of unfair contract terms.109
However this is different for the so called ‘reduction’ of standard terms. In this case the judge reduces the content of an unfair contract term to a standard term which would well be valid.110 Objections against this approach arise because the professional might be tempted to use unfair
104
“Void legal acts would be without any legal effect and this would have to be recognized by the courts ab officio” in M.B.M.LOOS, “The influence of European consumer law on general contract law and the need for
spontaneous harmonization”, op.cit., 5.
105 ECJ judgment of 27 June 2000, Joined Cases C-240/98 to C-244/98 - Océano Grupo Editorial SA v. Murciano Quintero [2000] ECR I-04941; ECJ judgment of 21 November 2002, C-473/00 - Cofidis v. Fredout,
[2002] ECR I-10875; ECJ judgment of 26 October 2006, C-168/05 – Elisa María Mostaza Claro v. Centro
Móvil Milenium SL,[2006] ECR I-10421; ECJ judgment of 4 June 2009, C-243/08 – Pannon GSM Zrt v. Erzsébet Sustikné Gyorfi, n.y.r.; ECJ judgment of 9 November 2010, C-137/08 - VB Pénzügyi Lízing Zrt. v.
Ferenc Schneider, [2010] ECR I-10847; ECJ judgment of 14 June 2012, C-618/10 - Banco Español de Crédito SA v. Joaquín Calderón Camino, [2012] ECR 349.
106 M.B.M. L
OOS, Algemene voorwaarden, Boom Masterreeks, Den Haag, Boom Juridische uitgevers, 2013, 269;
107
Article 3:49 Ways to nullify a voidable juridical act:
A voidable juridical act is nullified either by an extrajudicial declaration or by a court's judgment.
108 Article 3:41 BW: Partial nullity:
If a ground for nullity concerns just one part of a juridical act, then the valid part of that act remains in force as an independent juridical act, insofar it is not, in regard of the content and the necessary implications of the originally intended juridical act, indissolubly connected with the invalid part.
109 Example of partial nullity: “Payment must be made within 14 days; Suspension of payment is not possible “.
The second part of this sentence is pursuant to Article 6:236 c. BW an unfair contract term and therefore voidable. However there are no objections against the first part of this sentence. This part remains valid independently of the second one. Therefore, the nullity only affects the second part of this sentence; in M.B.M. LOOS, TvC, 2012, 290;
110 V. V
AN DEN BRINK, “Dwingend karakter van afd. 6.5.3., de vernietigbaarheid van bedingen”, in B.WESSELS, R.H.C.JONGENEEL,M.L.HENDRIKSE, Algemene voorwaarden, Deventer, Kluwer, 2006, 90-91.
