Oberster Gerichtshof; 2014-03-13; C., Ltd; C., Ltd; 6 Ob 33/14t
Decision by national courts in the field of European Union law — ECLI:AT:OGH0002:2014:0060OB00033.14T.0313.000
Date: 2014-03-13
Subject matter: Judicial cooperation in civil matters
Origin: Austria

82014AT0313(51)_ENG_SUMJURE
JURE summary
JURE summary
A legal entity based on the Virgin Islands (the “plaintiff”) brought an action for damages against a legal entity based on Malta (the “defendant”).
Before accepting the action, the First Instance court (Handelsgericht Wien) assigned the plaintiff to pay for security for costs in proceedings. The plaintiff did not agree and brought an appeal against this decision. The appeals court (Oberlandesgericht Wien) overturned the First Instance court’s decision and ordered it to supplement the action. It was to clarify whether a decision on costs of the proceedings against the plaintiff would be enforced on the Virgin Islands. An appeal is admissible in the Oberster Gerichtshof (Supreme Court of Justice, hereinafter the “Supreme Court”) because there is a lack of jurisdiction on whether plaintiffs from overseas countries and territories of the United Kingdom may be exempted from the payment of a security for costs.
The defendant appealed against the appeals court’s decision before the Supreme Court. The Supreme Court decided that the appeal was admissible and entitled. The British overseas territories, which include the Virgin Islands, are not subject to the provisions of Council Regulation (EC) No 44/2001 of 22. December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (“Brussels I Regulation”). On the other hand, the Austrian British mutual legal assistance agreement ratified by Austria in 1932 (hereinafter “the agreement”) shall apply.
With regard of the relevant Article 11 of the agreement (quote: “The members of one of the High Contracting Parties are to be treated as the members of the other High Contracting Party within the territory of the other High Contracting Party, as long as the concern is with the granting of the legal assistance or with the detention for failure to comply with decisions on account of debts; and provided that they are resident in one of these areas, they are not obligated to provide security for costs, where a member of the other high contracting, would not be obligated.”), the Supreme Court has  repeatedly made clear that any national of another Contracting State that brings action in Austria is exempt from the requirement for the payment of a security deposit only if he or she is residing in Austria, and not in another Contracting State (see decision 3 Ob 123/88, 6 Ob 575/92 or 9 Ob 173/97z).
Within the meaning of the agreement, the nationals of the other Contracting State are thus equal with residents when they reside in the State of the process.
However in the contested decision, the appeals court considered Article 57(2)(1a) of the Code of civil procedure (ZPO) as relevant to the decision. There was no obligation for security if a judicial (read Austrian) decision on the costs of the proceedings would be enforced in the plaintiff‘s State of the habitual residence. Never the less, this view conflicts with the Supreme Court‘s established case law and the appeals court did not deal with this case-law any further.
With regard of the updated provisions of ZPO § 57, already decision 3 Ob 123/88 pointed out firmly that international treaties are mainly decisive to the assessment of the extent to which foreigners that bring action have to provide security for costs of proceedings.
The plaintiff was not a resident in the process state (Austria) and therefore it does not matter, whether Austrians as plaintiffs must provide a security for costs on the Virgin Islands or whether an Austrian decision on process costs would be enforced on the Virgin Islands.
The Supreme Court upheld the defendant‘s appeal and changed the appeals court‘s decision in part, so that the First Instance court‘s decision was restored.