Investcapital (Unfair terms in consumer contracts - Revolving credit agreement - Judgment) [2024] EUECJ C-724/22 (29 February 2024)

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(Reference for a preliminary ruling – Unfair terms in consumer contracts – Directive 93/13/EEC – Principle of effectiveness of EU law – Revolving credit agreement – Order for payment procedure – Review of the court’s own motion of whether contractual terms are unfair in the course of that procedure – Enforcement of the procedural decision terminating that procedure – Loss, due to a time-bar, of the possibility of raising the unfairness of a contractual term at the stage of enforcement of the order for payment – Power of review of the national court)

REQUEST for a preliminary ruling under Article 267 TFEU from the Juzgado de Primera Instancia n. 2 de León (Court of First Instance No 2, León, Spain), made by decision of 26 July 2022, received at the Court on 24 November 2022, in the proceedings

composed of O. Spineanu-Matei (Rapporteur), President of the Chamber, J.‑C. Bonichot and S. Rodin, Judges,

– the Italian Government, by G. Palmieri, acting as Agent, and by M. Cherubini, avvocato dello Stato,

– the European Commission, by J. Baquero Cruz and N. Ruiz García, acting as Agents,

having decided, after hearing the Advocate General, to proceed to judgment without an Opinion,

1 This request for a preliminary ruling concerns the interpretation of Article 7 of Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts (OJ 1993 L 95, p. 29) and the interpretation of the principle of effectiveness.

2 The request has been made in enforcement proceedings between Investcapital Ltd and G.H.R., a consumer, concerning the enforcement of an order for payment in respect of a debt arising from a credit agreement.

3 The twenty-fourth recital of Directive 93/13 states that ‘the courts or administrative authorities of the Member States must have at their disposal adequate and effective means of preventing the continued application of unfair terms in consumer contracts’.

‘Member States shall lay down that unfair terms used in a contract concluded with a consumer by a seller or supplier shall, as provided for under their national law, not be binding on the consumer and that the contract shall continue to bind the parties upon those terms if it is capable of continuing in existence without the unfair terms.’

‘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.’

6 Article 136 of Ley 1/2000 de Enjuiciamiento Civil (Law 1/2000 on Civil Procedure) of 7 January 2000 (BOE No 7 of 8 January 2000, p. 575) (‘the LEC’) provides:

‘Once the time limit for carrying out a procedural step has elapsed, the step in question shall become time-barred and the opportunity to carry it out shall be lost. The judicial officer shall place on record that the time limit has elapsed by way of official document and shall order the measures to be adopted or shall serve notice to the court so that the corresponding decision can be ordered.’

‘Once the action for enforcement has been brought, and provided that the procedural rules and requirements have been observed, that the enforceable instrument is not vitiated by any formal defect and that the acts of enforcement sought are consistent with the nature and content of the instrument, the court shall draw up an order containing the general enforcement order and shall issue it.’

8 Article 556 of the LEC, entitled ‘Objection to the enforcement of procedural decisions, arbitral awards or mediation agreements’, provides:

‘1. If the enforceable instrument is a procedural decision or arbitral decision making an award, or a mediation agreement, the party against whom enforcement is sought may, within 10 days of service of the enforcement order, object to it in writing by claiming payment or compliance with the operative part of the judgment, arbitral award or agreement, in which case it must adduce documentary evidence.

It is also possible to object to enforcement by claiming that it is time-barred or by relying on any agreements or settlements which have been concluded in order to avoid enforcement, provided that such agreements and settlements are set out in a notarised act.

2. Any objection lodged in the situations set out in the preceding paragraph shall not have suspensory effect on enforcement.

9 The LEC was amended by Ley 42/2015 de reforma de la Ley 1/2000 (Law 42/2015 amending Law 1/2000) of 5 October 2015 (BOE No 239 of 6 October 2015) (‘the amended LEC’). Article 815(4) thereof provides:

‘If the claim for recovery of a debt is based on a contract between a business or a seller or supplier and a consumer or user, the judicial officer, before making an order for payment, shall notify the court so that the latter may examine whether any of the terms on which the application is based, or which have determined the amount payable, are unfair.

The court shall examine of its own motion whether any of the terms on which the application is based, or which have determined the amount payable, may be considered to be unfair. If the court finds that any of the terms may be considered to be unfair, it shall hear the parties within five days. After hearing the parties, the court shall rule as appropriate by means of an order within the next five days. Representation by a lawyer or court agent shall not be mandatory during that procedure.

If any of the contractual terms is found to be unfair, the order made shall stipulate the consequences of that finding and rule either that the claim is inadmissible or that the proceedings are to continue without the application of the terms considered to be unfair.

If the court finds that there are no unfair terms, it shall make a ruling to that effect and the judicial officer shall proceed to issue an order for payment against the debtor as laid down in paragraph 1.

‘1. If the debtor does not comply with the order for payment or does not enter an appearance, the judicial officer shall make an order terminating the order for payment procedure and give notice to the creditor to seek an enforcement order, a mere request to such effect being sufficient for this purpose, there being no need to wait until the period of twenty days laid down in Article 548 of this Law has elapsed.

2. Once ordered, enforcement shall proceed in accordance with the provisions governing the enforcement of court judgments, being amenable to opposition as provided in the case of the latter, but the applicant in the order for payment proceedings and the debtor against whom an order for payment has been made may not later claim in ordinary proceedings the sum claimed in the order for payment proceedings or recovery of the sum obtained by way of enforcement.

With effect from the pronouncement of the order for enforcement, the debt shall accrue interest in accordance with Article 576.’

The dispute in the main proceedings and the questions referred for a preliminary ruling

11 On 23 July 2018, Investcapital applied for an order for payment against G.H.R., claiming payment of EUR 5 774.84 based on a debt assigned to it by Servicios Financieros Carrefour EFC SA. That debt had arisen under a revolving consumer credit agreement (‘the credit agreement’).

12 In support of its application, Investcapital submitted the credit agreement in question and a statement of debt drawn up by Investcapital itself, but it did not include any accounting certificate relating to that statement or originating from Servicios Financieros Carrefour concerning the debt. In the statement of debt, the amount claimed was broken down into ‘unpaid capital’ of EUR 5 517.27 and fees and recovery costs of EUR 257.53. No breakdown of the ‘unpaid capital’ was provided.

13 On 17 December 2018, the court gave Investcapital and G.H.R. the opportunity to submit observations on whether the terms relating to interest, costs and fees contained in the credit agreement were unfair. In response, Investcapital stated that it was waiving the amount claimed in respect of fees and recovery costs, so that the order for payment application covered only the amount of unpaid capital, namely EUR 5 517.27. G.H.R. did not submit observations. The court did not find any of the contractual terms to be unfair.

14 Consequently, by decision of the judicial officer of 9 July 2019, the order for payment procedure was terminated.

15 On 16 December 2021, Investcapital brought an action for enforcement before the Juzgado de Primera Instancia n. 2 de León (Court of First Instance No 2, Léon, Spain), the referring court, on the basis of the decision of 9 July 2019 as the enforceable instrument.

16 The referring court states that the ‘experience of the courts’ shows that the absence of any accounting certificate or document concerning the amount claimed in respect of ‘unpaid capital’ and the absence of a breakdown of that amount may be indicative of a practice of concealing potentially unfair terms present in the credit agreement, since that amount might not correspond to the sum due as the principal amount of the debt. That is why it found that the review of whether the terms of that agreement were unfair, which took place during the order for payment procedure, was carried out without access to all the necessary information for that purpose.

17 That finding led the referring court to ask the parties to the dispute before it about the possibility of conducting a further review of whether the terms of the credit agreement were unfair. Investcapital submitted that a second review in that regard would infringe the principle of the time-barring of procedural steps on account of the expiry of the time limit set for that purpose. G.H.R. argued that a further review at the enforcement stage is still possible under Directive 93/13.

18 In that regard, the referring court states that, unlike the situations at issue in the cases that gave rise to the judgments of 18 February 2016, Finanmadrid EFC (C‑49/14, EU:C:2016:98), and of 17 May 2022, Ibercaja Banco (C‑600/19, EU:C:2022:394), the amended LEC now provides for a review by the court of its own motion of whether contractual terms are unfair in the course of the order for payment procedure. However, the judicial instrument resulting from such a procedure cannot be the subject of any other review or objection on the ground that those terms are unfair, since it is assumed to have been issued after such a review, prescribed in mandatory terms by the amended LEC, has been carried out.

19 The referring court also observes that, by providing for a review of whether contractual terms are unfair in the course of the order for payment procedure and not at the stage of enforcement of the instrument resulting from such a procedure, the Spanish legislature intended that review to be carried out exclusively at a certain stage of the proceedings, failing which it would be time-barred under Article 136 of the LEC. Once that stage has been completed, the review of whether contractual terms are unfair becomes time-barred. Furthermore, in the interests of legal certainty, Spanish law prohibits the review of final judicial decisions, such as the decision terminating the order for payment procedure.

20 Against that background, the referring court is uncertain as to whether Article 7 of Directive 93/13, read in the light of the principle of effectiveness, must be interpreted as precluding national legislation which does not allow it, because the review of whether contractual terms are unfair is time-barred, to carry out, in the procedure to enforce an order for payment, a further review to that effect, if it considers that there are unfair terms which were not detected during the order for payment procedure resulting in the issue of the instrument in respect of which enforcement is sought.

21 That court also wonders whether, in order to carry out such a review, it would be consistent with the requirements imposed by that article to request, in the procedure to enforce an order for payment, additional documents over and above those requested in the order for payment procedure.

22 In those circumstances, the Juzgado de Primera Instancia n. 2 de León (Court of First Instance No 2, León) decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:

‘(1) Does Article 7 of [Directive 93/13] preclude a court, when enforcing an instrument stemming from an order for payment procedure in which a review of unfair terms has already been carried out, from carrying out of its own motion a further review of unfair terms?

If not, does Article 7 of [Directive 93/13] preclude the court from asking the party seeking enforcement to provide such information as may be necessary to determine the origin of the amount of the debt, including the principal and, as the case may be, any interest, contractual penalties and other sums, in order to review of its own motion whether those terms are unfair? Does Article 7 of that directive preclude national legislation which does not provide for the possibility of requesting such additional documents during the enforcement procedure?

(2) Does the principle of effectiveness of EU law preclude national procedural legislation which prevents or does not provide for a second review of unfair terms by the court of its own motion in the procedure for enforcing a procedural instrument stemming from an order for payment procedure, [if] it is considered that unfair terms may be present on account of an imperfect or incomplete review of unfairness in the prior procedure during which that enforceable instrument was issued?

If so, is the fact that the court may ask the party seeking enforcement to provide such documents as may be necessary to determine the heads of claim under the contract that make up the amount of the debt, in order to review whether any of the terms are unfair, consistent with the principle of effectiveness of EU law?’

23 The Spanish Government contends that the questions referred for a preliminary ruling are inadmissible because the factual premiss on which those questions are based, namely an incomplete review of the potential unfairness of the terms of the credit agreement during the order for payment procedure, is hypothetical, given that, in the course of that procedure, the court carried out a review of its own motion, in accordance with Article 815(4) of the amended LEC. The Spanish Government also argues that the examination of whether the amount claimed by Investcapital is correctly quantified does not require a review of whether the terms of the credit agreement are unfair, as provided for in Directive 93/13.

24 In that regard, it should be recalled that it is solely for the national court before which the dispute has been brought, and which must assume responsibility for the judicial decision to be made, to determine, in the light of the particular circumstances of the case in the main proceedings, the relevance of the questions that it submits to the Court. Where the questions referred concern the interpretation or the validity of a rule of EU law, the Court is in principle required to give a ruling. It follows that a question referred for a preliminary ruling concerning EU law enjoys a presumption of relevance. The Court may refuse to rule on such a question only where it is quite obvious that the interpretation of EU law that is sought bears no relation to the actual facts of the main action or its purpose, where the problem is hypothetical, or where the Court does not have before it the factual or legal material necessary to give a useful answer to the questions submitted to it (see, to that effect, judgment of 29 June 2023, International Protection Appeals Tribunal and Others (Attack in Pakistan), C‑756/21, EU:C:2023:523, paragraphs 35 and 36).

25 In the present case, the order for reference sets out in sufficient detail the legal and factual context of the case in the main proceedings, and the information provided by the referring court makes it possible to determine the scope of the questions raised.

26 In addition, it is for the referring court alone to determine whether the review of the potential unfairness of the terms of the credit agreement during the order for payment procedure may be regarded as complete and whether, in order to satisfy itself that the amount claimed in the procedure for enforcement has been correctly quantified, a prior assessment of the unfairness of the terms of the credit agreement is necessary.

27 In those circumstances, the request for a preliminary ruling must be held to be admissible.

28 By the first parts of questions 1 and 2, which should be considered together, the referring court asks, in essence, whether Article 7(1) of Directive 93/13, read in the light of the principle of effectiveness, precludes national legislation which, because of a time-bar, does not allow a court hearing the enforcement of an order for payment to review, of its own motion or at the consumer’s request, whether the terms of a credit agreement concluded between a seller or supplier and a consumer are unfair, where such a review has already been carried out by a court in the course of the order for payment procedure, but there are grounds for believing that the review was incomplete.

29 As a preliminary point, it should be recalled that, as is apparent from the settled case-law of the Court, Directive 93/13 and, in particular, Article 7(1) thereof, read in conjunction with its twenty-fourth recital, require Member States to provide for adequate and effective means to prevent the continued use of unfair terms in contracts concluded with consumers by sellers or suppliers (see, to that effect, judgments of 29 October 2015, BBVA, C‑8/14, EU:C:2015:731, paragraph 19, and of 31 March 2022, Lombard Lízing, C‑472/20, EU:C:2022:242, paragraph 36 and the case-law cited).

30 While the Court has already defined, on several occasions, the way in which national courts must ensure that the rights which consumers derive from that directive are protected, the fact remains that, in principle, EU law does not harmonise the procedures applicable to examining whether a contractual term is unfair and that those procedures accordingly fall within the domestic legal system of the Member States, by virtue of the principle of procedural autonomy of those States; nevertheless, those procedures must be no less favourable than those governing similar domestic actions (principle of equivalence) and not make it impossible in practice or excessively difficult to exercise the rights conferred by EU law (principle of effectiveness) (see, inter alia, judgment of 17 May 2022, Ibercaja Banco, C‑600/19, EU:C:2022:394, paragraph 39 and the case-law cited).

31 As regards the principle of effectiveness, which alone is the subject of the referring court’s questions, it is the Court’s settled case-law that every case in which the question arises as to whether a national procedural provision makes the application of EU law impossible or excessively difficult must be analysed by reference to the role of that provision in the procedure, its progress and its special features, viewed as a whole, before the various national bodies (judgment of 22 September 2022, Vicente (Action for the recovery of lawyers’ fees), C‑335/21, EU:C:2022:720, paragraph 55 and the case-law cited).

32 In the present case, it is apparent from the file submitted to the Court that, in the Spanish procedural system, the order for payment procedure, provided for in Article 815 of the LEC, was amended by Law 42/2015 to enable a court to review of its own motion whether contractual terms are unfair in the light of Directive 93/13.

33 According to the order for reference, an application for an order for payment, based on a contract concluded between a seller or supplier and a consumer, is, under Article 815(4) of the amended LEC, to be notified by the judicial officer to the court so that it can review of its own motion whether any of the contractual terms on which the application is based, or which determine the amount payable, are unfair. If the court finds that any of the terms concerned may be unfair, it is to invite the parties to submit observations. After hearing the parties, the court is to rule by means of an order stipulating, where appropriate, the consequences of finding that the terms under consideration are unfair. The order is amenable to appeal. If the court finds that there are no unfair terms, it is to make a ruling to that effect and the judicial officer is to proceed to issue an order for payment against the debtor.

34 Article 816(1) of the amended LEC provides that if the debtor does not comply with the order for payment or does not enter an appearance, the judicial officer is to make an order terminating the order for payment procedure, which constitutes an enforceable instrument. Under Article 556 of the LEC, that order is a procedural decision which cannot be challenged on grounds relating to the potential unfairness of the contractual terms.

35 The referring court states that the fact that the Spanish legislature provided for an examination of whether contractual terms are unfair in the course of the order for payment procedure and not at the stage of enforcement of the judicial officer’s decision issued at the end of that procedure is proof that its intention was to require that review to be carried out in proceedings prior to enforcement of the order for payment, failing which the review would be time-barred. The consumer would therefore be time-barred from applying for such a review at the stage of enforcement of the order for payment and that review could also not be carried out by the court of its own motion.

36 In the present case, although it is not disputed that such a review took place in the course of the order for payment procedure, the referring court nevertheless wonders whether that review was effective, in view of the documents submitted in support of the application for an order for payment, which, in its view, were insufficient to enable the court to determine how the amount of the debt claimed was calculated. In those circumstances, the referring court is unsure whether Article 7(1) of Directive 93/13, read in the light of the principle of effectiveness, requires the court responsible for enforcement to review whether contractual terms are unfair, notwithstanding national procedural rules providing that the right to carry out a procedural step is time-barred once the time limit set for that purpose has elapsed.

37 In that regard, it should be noted at the outset that the fact that the review of whether contractual terms are unfair is envisaged only in the course of the order for payment procedure and not at the stage of enforcement of the order issued at the end of that procedure does not, in itself, constitute a breach of the principle of effectiveness.

38 As is apparent from the case-law of the Court, observance of that principle is ensured where the national procedural system allows a court, in the course of the order for payment procedure or the procedure to enforce an order for payment, to review of its own motion whether terms in the contract concerned by those procedures are unfair (see, to that effect, judgment of 18 February 2016, Finanmadrid EFC, C‑49/14, EU:C:2016:98, paragraph 46).

39 Furthermore, the Court has already had occasion to observe that, in order to ensure stability of the law and legal relations, as well as the sound administration of justice, it is important that judicial decisions which have become definitive, after all rights of appeal have been exhausted or after expiry of the time limits provided to exercise those rights, can no longer be called into question (judgment of 17 May 2022, Ibercaja Banco, C‑600/19, EU:C:2022:394, paragraph 41 and the case-law cited).

40 As regards the issue of a time-bar due to the expiry of certain procedural time limits, it is apparent from the Court’s case-law that reasonable time limits for bringing proceedings, laid down in the interests of legal certainty, are not liable to make it in practice impossible or excessively difficult to exercise the rights conferred by the EU legal order, if such time limits are sufficient in practical terms to enable a consumer to prepare and bring an effective action (judgment of 9 July 2020, Raiffeisen Bank and BRD Groupe Société Générale, C‑698/18 and C‑699/18, EU:C:2020:537, paragraph 62 and the case-law cited).

41 In the present case, it is not the length of the time limits set for the consumer to assert, in the course of the order for payment procedure, his rights under Directive 93/13 which has prompted the referring court’s questions, but the time-bar triggered by expiry of those time limits and the ensuing impossibility for that court to examine, of its own motion or at the consumer’s request, during the procedure to enforce the order for payment, whether the contractual terms are unfair.

42 In that regard, it should be recalled that, in the context of mortgage enforcement proceedings in which the court was required to examine of its own motion whether contractual terms were unfair when those proceedings were initiated, without there being any possibility of that review being carried out at a later stage of the proceedings, the Court held that the protection afforded by Directive 93/13 would be guaranteed only if the national court expressly stated, in its decision authorising the mortgage enforcement, that it had carried out an examination of its own motion as to whether the terms of the instrument giving rise to the mortgage enforcement proceedings were unfair, that that examination, with at least summary reasons, had not revealed the existence of any unfair terms and that, in the absence of an objection within the period laid down by national law, the consumer would be time-barred from asserting the possible unfairness of those terms (judgment of 17 May 2022, Ibercaja Banco, C‑600/19, EU:C:2022:394, paragraph 51).

43 It is also apparent from the case-law that, in the case where, in a previous examination of a contract in dispute which led to the adoption of a decision which has become res judicata, the national court limited itself to examining of its own motion, with regard to Directive 93/13, one or certain terms of that contract, that directive requires a court, before which subsequent proceedings have been properly lodged, to assess, at the request of the parties or of its own motion where it is in possession of the legal and factual elements necessary for that purpose, the potential unfairness of other terms of that contract. In the absence of such a review, consumer protection would be incomplete and insufficient and would not constitute either an adequate or effective means of preventing the continued use of such terms, contrary to Article 7(1) of that directive (judgment of 26 January 2017, Banco Primus, C‑421/14, EU:C:2017:60, paragraph 52 and the case-law cited).

44 As regards, in particular, the statement of reasons to be provided by a court which has examined whether contractual terms are unfair, the Court has held that that statement of reasons must enable a court hearing a subsequent action to identify, first, the terms or parts of terms which were examined in the light of Directive 93/13 in the earlier proceedings and, secondly, the reasons, even if set out in summary form, for the finding of the court hearing those earlier proceedings that those terms or parts of terms were not unfair (see, to that effect, order of 18 December 2023, Eurobank Bulgaria, C‑231/23, EU:C:2023:1008, paragraph 34).

45 It follows from the foregoing that a court’s review of whether terms in a contract concluded between a consumer and a seller or supplier are unfair is consistent with the principle of effectiveness in the light of Directive 93/13 if, first, the consumer has been informed of the existence of that review and of the consequences of his or her inaction as regards the time-barring of the right to assert the possible unfairness of the contractual terms, and, secondly, the decision taken following that review contains a sufficient statement of reasons making it possible to identify the terms which were examined on that occasion and the reasons, even if set out in summary form, for the finding of the court that those terms are not unfair. A judicial decision which meets those requirements may have the effect of preventing a further review of whether the contractual terms are unfair in subsequent proceedings.

46 In the present case, it is apparent from the file submitted to the Court that, in the course of the order for payment procedure, the court examined of its own motion, pursuant to its obligation under the amended LEC, the terms of the credit agreement and, since it was unsure whether those terms were unfair, invited the parties to submit observations in that regard. The consumer did not respond to that invitation or appeal against the court’s order finding that there were no such terms, following which the judicial officer issued an order for payment. It is also apparent that the consumer did not lodge an objection to the order for payment, with the result that the judicial officer’s decision of 9 July 2019 constitutes the decision terminating the order for payment procedure.

47 Furthermore, it should also be noted that it does not transpire from the order for reference that procedural constraints might have deterred the consumer from asserting his rights in the order for payment procedure.

48 Consequently, in the light of the case-law cited in paragraphs 42 and 44 of the present judgment, provided, first, that the consumer was aware of the existence of the review by the court of its own motion, in the course of the order for payment procedure, of whether the contractual terms were unfair and of the consequences of his inaction, and, secondly, that the order made by the court following that review contains a sufficient statement of reasons, the review carried out by the court in the course of that procedure appears to meet the requirement of effectiveness in the light of Article 7 of Directive 93/13, which is, however, for the referring court to ascertain.

49 It should also be borne in mind that it was open to the consumer, if he believed he had grounds for doing so, to challenge, within the time limits set for that purpose, the finding that the terms of the contract were not unfair by means of an appeal brought against the judicial decision taken by the court in the order for payment procedure.

50 In its written observations, the European Commission states that as no reasoning at all was given for the judicial officer’s decision terminating the order for payment procedure, it cannot result in the review of whether the contractual terms are unfair being time-barred.

51 However, having regard to the principle of procedural autonomy, referred to in paragraph 30 above, Member States remain free to organise their rules of procedure in such a way that a review under Directive 93/13 may be carried out not only when the decision terminating the order for payment procedure is taken but at any stage of that procedure, provided that it is carried out by a court and complies with the principle of effectiveness. Since, under Spanish rules of procedure, such a review takes place in the course of the order for payment procedure, the fact that it can no longer be carried out during the procedure to enforce the order for payment is not, in itself, capable of undermining the effectiveness of that directive.

52 In the light of the foregoing, the answer to the first parts of questions 1 and 2 is that Article 7(1) of Directive 93/13, read in the light of the principle of effectiveness, must be interpreted as not precluding national legislation which, because of a time-bar, does not allow a court hearing the enforcement of an order for payment to review, of its own motion or at the consumer’s request, whether the terms of a credit agreement concluded between a seller or supplier and a consumer are unfair, where such a review has already been carried out by a court in the course of the order for payment procedure, provided that that court has identified in its decision the terms which were reviewed, that it has set out, even in summary form, the reasons why those terms were not unfair, and that it has stated that, if the remedies provided for under national law against that decision have not been exercised within the time limit set for that purpose, the consumer will be time-barred from asserting the possible unfairness of those terms.

53 By the second parts of questions 1 and 2, which should be considered together, the referring court asks whether Article 7(1) of Directive 93/13, read in the light of the principle of effectiveness, precludes national legislation which does not allow a court hearing the enforcement of an order for payment to adopt of its own motion investigative measures in order to determine the factual or legal material needed to review whether the terms contained in a credit agreement concluded between a seller or supplier and a consumer are unfair.

54 As a preliminary point, it should be noted that those questions are justified only if, following the analysis which the referring court is required to conduct in the light of the first parts of questions 1 and 2, it concludes that the review carried out in the course of the order for payment procedure does not meet the requirements of the principle of effectiveness as regards Directive 93/13 and that the onus is therefore on it to carry out a further review.

55 In order to answer the second parts of those questions, it should be noted that, according to settled case-law, the system of protection introduced by Directive 93/13 is based on the idea that the consumer is in a weak position vis-à-vis the seller or supplier, as regards both his or her bargaining power and his or her level of knowledge (see, inter alia, to that effect, judgment of 4 May 2023, BRD Groupe Societé Générale and Next Capital Solutions, C‑200/21, EU:C:2023:380, paragraph 24 and the case-law cited).

56 The imbalance between the consumer and the seller or supplier may be corrected only by positive action unconnected with the parties to the contract (see, inter alia, judgment of 11 March 2020, Lintner, C‑511/17, EU:C:2020:188, paragraph 25 and the case-law cited).

57 If the referring court concludes that, since no effective review was carried out in the course of the order for payment procedure, it is for that court itself to review whether the terms contained in the credit agreement are unfair, it must have the possibility of taking of its own motion the necessary investigative measures for that purpose (see, to that effect, judgment of 22 September 2022, Vicente (Action for the recovery of lawyers’ fees), C‑335/21, EU:C:2022:720, paragraph 73 and the case-law cited).

58 In the light of the foregoing, the answer to the second parts of questions 1 and 2 is that Article 7(1) of Directive 93/13, read in the light of the principle of effectiveness, must be interpreted as precluding national legislation which does not allow a court hearing the enforcement of an order for payment to adopt of its own motion investigative measures in order to determine the factual or legal material needed to review whether the terms contained in a credit agreement concluded between a seller or supplier and a consumer are unfair, where the review carried out by the court having jurisdiction in the course of the order for payment procedure does not meet the requirements of the principle of effectiveness as regards that directive.

59 Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.

1. Article 7(1) of Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts, read in the light of the principle of effectiveness,

must be interpreted as not precluding national legislation which, because of a time-bar, does not allow a court hearing the enforcement of an order for payment to review, of its own motion or at the consumer’s request, whether the terms of a credit agreement concluded between a seller or supplier and a consumer are unfair, where such a review has already been carried out by a court in the course of the order for payment procedure, provided that that court has identified in its decision the terms which were reviewed, that it has set out, even in summary form, the reasons why those terms were not unfair, and that it has stated that, if the remedies provided for under national law against that decision have not been exercised within the time limit set for that purpose, the consumer will be time-barred from asserting the possible unfairness of those terms.

2. Article 7(1) of Directive 93/13, read in the light of the principle of effectiveness,

must be interpreted as precluding national legislation which does not allow a court hearing the enforcement of an order for payment to adopt of its own motion investigative measures in order to determine the factual or legal material needed to review whether the terms contained in a credit agreement concluded between a seller or supplier and a consumer are unfair, where the review carried out by the court having jurisdiction in the course of the order for payment procedure does not meet the requirements of the principle of effectiveness as regards that directive.

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You are here: BAILII >> Databases >> Court of Justice of the European Communities (including Court of First Instance Decisions) >> Investcapital (Unfair terms in consumer contracts - Revolving credit agreement - Judgment) [2024] EUECJ C-724/22 (29 February 2024) URL: http://www.bailii.org/eu/cases/EUECJ/2024/C72422.html Cite as: EU:C:2024:182, [2024] EUECJ C-724/22, ECLI:EU:C:2024:182

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