Order;Summary — ECLI:EU:C:2023:786
Date: 2023-10-05
Language of the case: Maltese
Court formation: Ninth Chamber
Subject matter: Consumer protection;Approximation of laws
Procedure: Reference for a preliminary ruling;Reference for a preliminary ruling - inadmissible
Origin: Malta

summary of the main facts 
REQUEST FOR A PRELIMINARY RULING 14.12.2022 – CASE C-25/23 
 
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4.1. In his sworn statement, the applicant states that on 16 September 2019 he 
signed a contract with the company No Deposit Cars Malta Limited for the 
purchase of a Vauxhall Corsa bearing the registration number BCC-957. A 
copy of the contract was submitted to the court. The agreed price was 
EUR 5 400, payable in monthly instalments of EUR 90 over a five-year 
period. On the same day he signed, he paid a deposit of EUR 700 for the 
payment of the road licence and the insurance policy and also signed sixty 
(60) bills of exchange for an amount of ninety euros (EUR 90) each. The 
vehicle was to be collected a week later and was actually collected by the 
applicant, but the vehicle had several faults and, on 31 October 2019, the 
applicant signed another agreement with the same company to return the 
vehicle and collect another vehicle (a Peugeot 308 bearing the registration 
number LQZ-612) for the price of EUR 12 000 payable in monthly 
instalments of EUR 200 over a five-year period. On 31 October 2019, he 
also signed sixty (60) bills of exchange for an amount of two hundred euros 
(EUR 200) each. That second agreement has not been submitted in court. 
The bills of exchange drawn in relation to the first agreement were not 
returned to the debtor. 
4.2. The Peugeot 308 vehicle also developed several faults and so, on 30 
January 2020, the applicant signed another agreement with the same 
company to return the vehicle to them and to take another vehicle (a 
Hyundai 110 bearing registration number LQZ-637) for the price of 
EUR 9 000 payable in monthly instalments of EUR 150 over a five-year 
period. On that occasion, he also signed sixty (60) bills of exchange for an 
amount of hundred fifty euros (EUR 150) each. That third agreement has not 
been submitted to the court. The bills of exchange drawn in relation to the 
second agreement were not returned to the debtor. It appears that even that 
vehicle had numerous problems and that when the applicant sought to 
terminate the agreement with the company, No Deposit Cars Malta Limited 
ignored him. 
4.3. At some time, the bills of exchange, including those that are the subject of 
the present proceedings, were endorsed to Princess Holdings Limited, a 
company owned by the same shareholder holding all the shares in No 
Deposit Cars Malta Limited. 
4.4. Meanwhile, on 22 October 2020, the company Princess Holdings Limited 
lodged a judicial letter (with number 2155/2020) to enforce (under 
Article 253(e) of the COCP) eight bills of exchange (with a value of 
EUR 200 each) that were signed by the applicant when concluding the 
second agreement with No Deposit Cars Malta Limited. The applicant 
claims that he remained shocked because he had returned the second vehicle 
(and even the first vehicle) to No Deposit Cars Malta Limited. He claims 
that he was the victim of No Deposit Cars Malta Limited because it had kept 
the bills of exchange even though the vehicles were returned to it. 
PRINCESS HOLDINGS 
 
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4.5. No cross-examination of the applicant has been carried out by the defendant 
company and the court therefore considers that the facts as explained by the 
applicant are not disputed by Princess Holdings Limited. 
5 [OMISSIS] 
[The essential content of these provisions and their interpretation in case-law 
has been explained in points 2.1 to 2.12] 
6 Arguments of the parties 
6.1. The applicant, while acknowledging that his arguments relate to the 
underlying obligations and not to the bills of exchange themselves, submits 
that the company No Deposit Cars Malta Limited had acted fraudulently by 
retaining all the bills of exchange related to the contracts he had concluded 
with it, and did so despite the fact that the vehicles had been returned to it 
because they had faults. 
6.2. The applicant makes no mention of the endorsement and of whether it was 
intended to prejudice his rights. The fact remains, however, that the court 
can and has still to consider that issue when it gives its final decision. 
6.3. The defendant company, for its part, claims that the applicant’s arguments 
are not valid because they do not affect the validity of the bills of exchange 
themselves. It adds that, in any event, the contracts stipulated what the 
debtor had to do if he wished to rescind them and that the debtor could not 
claim that the contracts would be rescinded automatically on the basis of his 
assumption. 
7 Grounds on which the reference is requested 
7.1. The court considers that, in the context of individual consumer rights, there 
are two separate issues that merit guidance by the Court of Justice of the 
European Union, which are both linked to the principle that Maltese courts 
do not generally examine the contracts on the basis of which the bill of 
exchange was drawn and the underlying obligations. 
7.2. The contract submitted together with the applicant’s application is a typical 
hire-purchase agreement, whereby the company selling a vehicle to a 
consumer concludes an agreement with the consumer regarding the payment 
in instalments of the price in accordance with a schedule of payments that 
would be annexed to the agreement. The contract also provides for the 
drawing of the bills of exchange and establishes the measures that the 
company can take in the event of non-payment by the consumer. Ownership 
of the vehicle passes to the consumer only when the consumer has paid the 
full price. The contract may be considered to be a consumer credit 
agreement. 
REQUEST FOR A PRELIMINARY RULING 14.12.2022 – CASE C-25/23 
 
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7.3. The first issue is that, although the contract has been submitted together with 
the debtor’s application objecting to the enforcement of the bills of exchange 
(a common practice in such proceedings even though it is known that the 
court cannot examine the contract), the court is precluded from entering into 
its merits in order to, inter alia, examine whether it contains unfair terms in 
the sense of Directive 93/13 or whether the contract satisfies the provisions 
of Directive 2008/48 (in particular Article 5, concerning the pre-contractual 
information that should be communicated to the consumer, and Article 10, 
concerning the information that should be included in a credit agreement). 
7.4. The second issue is that the court is precluded from investigating whether, in 
fact, the company’s conduct during and/or after its transactions with the 
debtor had infringed the applicant’s rights as a consumer under 
Directive 2019/771, in particular the consumer’s right to receive, from the 
seller, goods that meet the requirements set out in Articles 6, 7 and 8 of that 
Directive and the consumer’s right to seek redress if they are not met. 
7.5. For the sake of completeness, the above-mentioned directives have been 
transposed into national law: Directive 93/13 and Directive 2019/771 in the 
Att dwar l-Affarijiet tal-Konsumatur (Consumer Affairs Act, Chapter 378 of 
the Laws of Malta), and Directive 2008/48 in the Regolamenti dwar Kreditu 
lill-Konsumatur (Consumer Credit Regulations, Subsidiary 
Legislation 378.12). 
7.6. The court considers that, while the first issue has been partially addressed by 
the Court of Justice of the European Union in its preliminary ruling 
delivered (by the Second Chamber) on 13 September 2018, Profi Credit 
Polska S.A. w Bielsku Białej v Mariusz Wawrzosek (C-176/17), the 
second issue however goes beyond this. In its judgment, the Court of Justice 
had stated: 
‘Article 7(1) of Council Directive 93/13/EEC of 5 April 1993 on unfair 
terms in consumer contracts must be interpreted as precluding national 
legislation, such as that at issue in the main proceedings, which permits 
issue of an order for payment founded on a valid promissory note that 
secures a claim arising from a consumer credit agreement, where the 
court dealing with an application for an order for payment does not 
have the power to examine whether the terms of that agreement are 
unfair, if the detailed rules for exercising the right to lodge an objection 
against such an order do not enable observance of the rights which the 
consumer derives from that directive to be ensured.’ 
7.7. The court considers that the facts in issue in Case C-176/17 are not the same 
as those in the present case, but there are also similarities. Maltese law does 
not prevent the consumer from lodging a claim against the seller in order to 
exercise his or her remedies. However, this can only take place in a separate 
action and not in the same action by which the consumer seeks to object to 
PRINCESS HOLDINGS 
 
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the enforcement of bills of exchange that have been presented for payment. 
This means, in practice, that a consumer can easily find himself or herself in 
a situation where he or she can exercise the remedies available to him or her 
only after a Maltese court had already ordered the enforcement of a bill of 
exchange against him or her and after the seller had already issued an 
warrant of execution against him or her. 
8 Questions referred to the Court of Justice of the European Union 
8.1.  In light of the above, the Court [of Magistrates] therefore refers the 
following questions to Court of Justice of the European Union for a 
preliminary ruling in accordance with Article 267 of the Treaty on the 
Functioning of the European Union: 
The first question 
Is the fact that, in the context of proceedings intended to render a bill of 
exchange enforceable (under Article 253(e) of the Code of Organisation 
and Civil Procedure), a Maltese court is precluded from examining the 
contract that preceded the drawing of the bill of exchange contrary to 
the provisions of Council Directive 93/13/EEC of 5 April 1993 on unfair 
terms in consumer contracts, in particular Articles 6(1) and 7(1) 
thereof? 
The second question 
Is the fact that, in the context of proceedings intended to render a bill of 
exchange enforceable (under Article 253(e) of the Code of Organisation 
and Civil Procedure), a Maltese court is precluded from examining the 
contract that preceded the drawing of the bill of exchange contrary to 
the provisions of Directive 2008/48/EC of the European Parliament and 
of the Council of 23 April 2008 on credit agreements for consumers and 
repealing Council Directive 87/102/EEC, in particular Articles 5 and 10 
thereof? 
The third question 
Is the fact that, in the context of proceedings intended to render a bill of 
exchange enforceable (under Article 253(e) of the Code of Organisation 
and Civil Procedure), a Maltese court is precluded from analysing the 
underlying obligations that preceded the drawing of the bill of exchange 
contrary to Directive (EU) 2019/771 of the European Parliament and of 
the Council of 20 May 2019 on certain aspects concerning contracts for 
the sale of goods, amending Regulation (EU) 2017/2394 and 
Directive 2009/22/EC, and repealing Directive 1999/44/EC, in particular 
to the consumer’s right to receive, from the seller, goods that meet the 
requirements set out in Articles 6, 7 and 8 of that Directive and to his or 
her right to seek redress if those requirements are not met?