Opinion of the Advocate General — ECLI:EU:C:2012:586
Date: 2012-09-20
Language of the case: Czech
Subject matter: Area of freedom, security and justice;Judicial cooperation in civil matters
Procedure: Reference for a preliminary ruling
Origin: Czechia

summary in points 13 to 18 above. They include information concerning the purpose for which the Credit Agreement was entered into and Mr Feichter’s role as participant in the documentation made available to the Lender under that agreement and the Supplemental Agreement, including the promissory note. The provision of such particulars by the national court is a standard part of the order for reference procedure. It enables this Court to give a useful answer to the questions referred. The risk is thereby minimised of the Court’s response as regards matters of EU law being hypothetical, failing to address issues that are essential to the resolution of the dispute before the national court or, indeed, addressing matters that are of no relevance to that dispute. 32. In the normal case, it is a matter for the national court to apply that response to the facts of the case before it, although the Court of Justice may give guidance based on the documents in the case and the written and oral observations which have been submitted to it. (19) In certain cases, however, this Court may determine that it can provide the national court with a fuller answer. Thus, in British Telecommunications, (20) a case involving the obligation of a Member State to pay compensation for loss suffered as a result of its failure to transpose a directive correctly into national law, the Court held that: ‘Whilst it is in principle for the national courts to verify whether or not the conditions governing State liability for a breach of Community law are fulfilled, in the present case the Court has all the necessary information to assess whether the facts amount to a sufficiently serious breach of Community law.’ (21) 33. It seems to me that the same principle applies by analogy in the present case. Because the national court has helpfully provided detailed background material, this Court is in a position to verify itself whether the definition of ‘consumer’ for the purposes of Articles 15 and 16 of the Regulation is satisfied in Mr Feichter’s case. Here, there is no suggestion that he assumed obligations either through the aval or under the Supplemental Agreement for the purposes of his private consumption or for a purpose outside his trade or profession. Indeed, the reverse appears to be the case. Those arrangements were entered into in support of a credit facility made available to the Borrower, a commercial entity, for the objectives of its business. That entity was one with which Mr Feichter was closely connected. The name of the business incorporated his surname, he was its managing director and a majority shareholder in the company. (22) 34. I therefore consider that the quality of consumer, which is essential to the objection of lack of jurisdiction entered by Mr Feichter in the main proceedings, is entirely absent in this case. The fact that a defendant may be a natural person and, as such, is likely to be a ‘consumer’ for certain purposes of his daily life does not, of itself, mean that that person will automatically be entitled to invoke Article 15(1) of the Regulation in any action brought against him. 35. That being so, the question whether the contract fell within one of the categories listed in Article 15(1) does not arise. 36. For the sake of completeness, I would add one or two remarks about the nature of a ‘contract concluded by a person, the consumer’ for the purposes of Articles 15 and 16 of the Regulation. As I take the view that this question has no bearing on the resolution of the case before the national court, I shall be brief and make no attempt to delve deeply into it. 37. The situation in the main proceedings represents, it seems to me, a perfect example of a case where a form of guarantee obligation was entered into by an individual that is not covered by the provisions relating to consumers in Articles 15 and 16 of the Regulation. There is no material before the Court to suggest that the (substantial) facility made available to the Borrower and guaranteed by the aval had anything to do with financing a natural person’s individual decisions to purchase consumables. 38. Let us take another example, in order to show the opposite end of the spectrum. A minor wishes to purchase a smartphone but the supplier, which is located in another Member State, refuses to enter into the purchase contract without his parents agreeing to act as guarantors of his obligations under it. The parents provide the necessary guarantee and the minor purchases the smartphone. In the contract entered into with the supplier, the minor is plainly a consumer. Articles 15 and 16 will apply to him in the event of the supplier seeking to bring proceedings against him under the contract. 39. What is the parents’ position? It seems to me that they, too, are entitled to the protection which those provisions afford. Such a result reflects the overall scheme of the Regulation. While they are, one imagines, likely to be more worldly-wise and financially solvent than their offspring, they can none the less be expected to be economically weaker and less experienced in legal matters than the professional co-contractor which the supplier represents. (23) The arrangements involving the parents thus constitute ‘matters relating to a contract concluded by a person, the consumer’ for the purposes of Article 15(1). 40. Interesting though such reflections may be, such an example is very far removed from the circumstances of the present case. Simply put, Mr Feichter is not a ‘consumer’ for the purposes of Articles 15 and 16 of the Regulation. 41. In the light of all the foregoing, I am of the view that the answer to the national court’s first question should be that, where a promissory note forms part of a series of arrangements entered into by a commercial entity for the purposes of its business, and a natural person who gives an aval thereon is closely connected with that entity, the aval is to be treated for the purpose of Article 15(1) of the Regulation as having been given for the purposes of trade or professional activity. It follows that the expression ‘matters relating to a contract concluded by a person, the consumer, for a purpose which can be regarded as being outside his trade or profession’ in Article 15(1) will not apply. Question 2 42. The essential issue underlying the second question is the applicability of the rules concerning jurisdiction ‘in matters relating to a contract’ laid down in Article 5(1)(a) of the Regulation. 43. The Court has held that, although that provision does not require the conclusion of a contract, there must as a minimum be an identifiable obligation. Such a rule is essential for the application of Article 5(1)(a), since the jurisdiction of the national court is determined by the place of performance of the obligation in question. (24) 44. That obligation must be freely assumed by one party towards another. To interpret the provision without laying down such a requirement would go beyond the situations envisaged by the Regulation. (25) The Court has summarised that requirement by stating that the rule of special jurisdiction laid down in Article 5(1)(a) ‘presupposes the establishment of a legal obligation freely consented to by one person towards another and on which the claimant’s action is based’. (26) 45. That there was a contract between the Lender and the Borrower in the present case is not in doubt. The Lender undertook to provide the Borrower with funds under the Credit Agreement and the Borrower was obliged to repay them in accordance with that agreement. Mr Feichter’s position was different, inasmuch as he was not a party to that agreement. But the giving of the aval under the promissory note still seems to me to represent a legal obligation that was freely consented to by him. By virtue of Paragraph 32(1) and (2) of the ZSS, he was bound in the same manner as the person for whom he had become guarantor, that is to say, the Borrower. (27) That he was not the direct beneficiary of the Lender’s obligations is thus irrelevant for the purposes of establishing jurisdiction under Article 5(1)(a). 46. Nor do I consider that it makes any difference that the promissory note was issued in incomplete form and thus fell, at that stage in its existence, to be classified as ‘inchoate’. It is at the time of bringing proceedings that the question of jurisdiction will crystallise. Indeed, since the note in question was issued in order to secure an overdraft facility, it could not, by definition, be issued in completed form at the time the facility was entered into. 47. I should add that the fact that national law classifies a bill of exchange as an abstract security which does not have the character of a contract (28) does not affect the position. With reference to the Brussels Convention, the Court has repeatedly held that the concepts used in the Convention – and in particular those used in Articles 5(1) and (3) and 13 (29) – must be interpreted independently, by reference principally to the system and objectives of the Convention, in order to ensure that it is uniformly applied in all the Contracting States. (30) I see no reason for the position to differ as regards the Regulation. (31) 48. I accordingly consider that the rule laid down in Article 5(1)(a) of the Regulation is capable of applying to the circumstances of the main proceedings. 49. In order to determine whether it does in fact apply, the national court will have to determine whether the place of performance of the obligation in question is situated within its territorial jurisdiction. (32) Neither of the specific provisions laid down in Article 5(1)(b) will be relevant, since the contract in question does not relate to the sale of goods or the provision of services. It follows that it is the place of payment that will be determinative. The order for reference records that the place for payment under the promissory note is Prague and adds that Mr Feichter takes no issue with that point. I would merely add that an arrangement whereby repayment of sums advanced is to be made in the lender’s place of business must, on any basis, be taken to represent normal practice under commercial lending agreements. 50. At first sight, that would appear to be an end to the matter. Since the parties are not in dispute as to the place of performance of the obligation which is determinative of jurisdiction, the court before which proceedings are brought may assume jurisdiction. 51. The national court, however, asks whether the fact that the promissory note was blank when issued and subsequently completed by the Lender has any effect on the position. It notes that the possibility cannot be ruled out that the place of payment was inserted in breach of the terms of the Supplemental Agreement or that that agreement was void for uncertainty or on other grounds. If that were the case, it would not be possible to speak of an obligation that had been freely assumed by one party towards another. (33) 52. I understand that point. However, since there does not appear to be any challenge on Mr Feichter’s part to the place of performance, the issue does not seem to arise in the present case. If, however, the place of payment under the promissory note were challenged, on whatever basis, I would make the following observations. 53. In referring to an obligation that has been freely assumed by one party towards another, the Court was describing how the notion of ‘contract’ falls to be understood for the purposes of the Regulation. If the guidelines laid down by the Court cannot be satisfied in a particular case, the expression ‘matters relating to a contract’ cannot be founded on in order to determine jurisdiction before a national court. But that does not mean that the expression cannot apply if the tenor of that obligation is in dispute. 54. Indeed, it is in the nature of the Regulation that its provisions may operate precisely where there is a disagreement. In a different but none the less closely-related context, the Court has held that Article 5(1)(a) will apply even where the existence of the contract on which the claim is based is in dispute between the parties. (34) If the position were otherwise, that provision would be in danger of being deprived of its effect, since it would be sufficient, in order to defeat the rule it lays down, for one of the parties to claim that the contract does not exist. 55. It seems to me that the same reasoning applies here by analogy. It would be very easy for a defendant who wished to override the Regulation to dispute, not the existence of the entire contract on which the claim is based, but a provision of that contract on which jurisdiction could otherwise be founded. To allow such an argument to succeed would risk defeating the whole object of the legislation, one of the primary aims of which is to provide certainty in the area it is designed to cover. (35) 56. Equally, though, it should not be open to an unscrupulous or ill‑advised applicant to assert jurisdiction on spurious grounds simply by asserting, without any legal basis for doing so, that a contract provides for the obligation purportedly founding jurisdiction to be performed in a particular place. 57. If, in proceedings involving ‘matters relating to a contract’ for the purpose of Article 5(1)(a) of the Regulation, there is a dispute as to the place of performance of the obligation in question, I suggest that the national court should first consider the defendant’s objection in that regard. If that objection is manifestly well founded, it should decline jurisdiction, unless it is plain that there are other, properly-substantiated, grounds on which it might proceed to determine the case before it. Next, and if necessary, it should consider the ground on which the applicant bases his claim of jurisdiction. If that ground is patently unfounded, the national court should decline to entertain the case before it. If (as may more commonly be the case), the true position is more difficult to ascertain, the court should determine whether the applicant has made out a prima facie case as regards the applicability of the relevant provision of the Regulation. If it finds that such a case exists, it may proceed to accept jurisdiction. 58. For all of the above reasons, I am of the view that the answer to the national court’s second question should be that the expression ‘matters relating to a contract’ in Article 5(1)(a) of the Regulation extends to claims under a promissory note originally issued in incomplete form (but subsequently completed) brought by the payee against the giver of the aval for the maker of the note. Concluding remarks 59. Applying the conclusions set out above to the case before the national court, it seems to me to be clear that that court will have jurisdiction to hear and determine the case in the main proceedings. Such a result seems to me not only to reflect the terms and overall scheme of the Regulation, it also seems to me to reflect the underlying reality of the situation. Indeed, if the outcome of the application of the Regulation were to be otherwise in a case such as this, the result would, I suggest, be manifestly absurd. 60. Let me take as an illustration the situation of lending institutions based in a new Member State (say, somewhere in the Balkans). A number of companies based in other Member States wish to set up subsidiaries to trade there, with a view to expanding their business. Those subsidiaries have, at the relevant time, no assets or no worthwhile assets to speak of. The lenders make it a condition of their making funds available that guarantees are provided by the individuals who are the managers and/or ultimate owners of the subsidiaries. Among the guarantors under those arrangements are a number of individuals domiciled in (let us say) Finland and Lithuania. It seems to me that it cannot be remotely conceivable, nor should it be conceivable, that the lenders in question should be unable to bring proceedings for the enforcement of the guarantees in question in their own Member State. Any other result would fly in the face of reality. Conclusion 61. For all of the above reasons, I propose that the Court should answer the questions referred by the Městký soud v Praze as follows: (1) Where a promissory note forms part of a series of arrangements entered into by a commercial entity for the purposes of its business, and a natural person who gives an aval thereon is closely connected with that entity, the aval is to be treated for the purpose of Article 15(1) 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 as having been given for the purposes of trade or professional activity. It follows that the expression ‘matters relating to a contract concluded by a person, the consumer, for a purpose which can be regarded as being outside his trade or profession’ in Article 15(1) of the Regulation will not apply. (2) The expression ‘matters relating to a contract’ in Article 5(1)(a) of the Regulation extends to claims under a promissory note originally issued in incomplete form (but subsequently completed) brought by the payee against the giver of the aval for the maker of the note. 1 – Original language: English. 2 – Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (OJ 2001 L 12, p. 1) (‘the Regulation’). 3 – See point 14 and footnote 9 below. 4 – See Article 76. 5 – Other than Denmark. 6 – OJ 1978 L 304, p. 36. 7 – Case C‑167/08 Draka NK Cables and Others [2009] ECR I‑3477, paragraph 20. 8 – There was some discussion at the hearing as to the precise meaning of the expression ‘abstract security’ in this context. That discussion confirmed the information provided by the national court before turning to some detailed, not to say intricate, points concerning, inter alia, the transferability of a promissory note and the effects of such transfer. There was nothing in the second part of that discussion, however, that affected the issues addressed in this Opinion and I therefore do not consider those points further. 9 – ‘Aval’ has been defined as: ‘a written engagement by one not a drawer, acceptor, or indorser of a note or bill of exchange that it will be paid at maturity’ – see http://www.merriam-webster.com/dictionary/aval. 10 – According to the information made available by the Czech Government in its written observations and confirmed at the hearing. See http://www.justice.cz/or. 11 – Article 2 of Protocol No 2 to the Convention on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters signed in Lugano on 30 October 2007, which entered into force on 1 January 2011, provides that any State bound by that convention and which is not a Member State (this includes the Swiss Confederation) is entitled to submit written observations, in accordance with Article 23 of the Protocol on the Statute of the Court of Justice, where, inter alia, a court or tribunal of a Member State refers to the Court of Justice for a preliminary ruling a question on the interpretation of the Regulation. 12 – See Case C‑27/02 Engler [2005] ECR I‑481, paragraph 32. 13 – See Case C‑96/00 Gabriel [2002] ECR I‑6367, paragraph 39. See also in that regard Case C‑89/91 Shearson Lehmann Hutton [1993] ECR I‑139, paragraph 18. 14 – See, to that effect, Case C‑440/97 GIE Groupe Concorde and Others [1999] ECR I‑6307, paragraph 29. See also recital 12 in the preamble to the Regulation. 15 – See in that regard Engler, cited in footnote 12 above, paragraph 43. 16 – Case C‑269/95 [1997] ECR I‑3767. 17 – Paragraph 17. 18 – Gabriel, cited in footnote 13 above, paragraph 38. See also Case C‑464/01 Gruber [2005] ECR I‑439, where the Court held that, where a person concludes a contract for goods intended for purposes which are in part within and in part outside his trade or profession, he may not rely on the special rules of jurisdiction laid down in respect of contracts entered into by consumers, unless the trade or professional purpose is so limited as to be negligible in the overall context of the supply, the fact that the private element may be predominant being irrelevant in that respect (paragraph 54). 19 – See, to that effect, Case C‑328/91 Thomas and Others [1993] ECR I‑1247, paragraph 13. 20 – Case C‑392/93 [1996] ECR I‑1631, paragraph 41. 21 – See also Joined Cases C‑283/94, C‑291/94 and C‑292/94 Denkavit and Others [1996] ECR I‑5063, paragraph 49, Case C‑429/09 Fuß [2010] ECR I‑12167, paragraph 53, and Lenaerts, K., Arts, D. and Maselis, I., Procedural Law of the European Union, Second Edition, Sweet and Maxwell, London, 2006, at 6-026. 22 – See point 14 above. 23 – See point 28 above. 24 – See Case C‑334/00 Tacconi [2002] ECR I‑7357, paragraph 22, and Engler, cited in footnote 12 above, paragraph 50. While those cases concerned the equivalent wording under the Brussels Convention, I see no reason for the position to differ as regards the Regulation. See point 8 above. 25 – See Case C‑26/91 Handte [1992] ECR I‑3967, paragraph 15. See also Engler, cited in footnote 12 above, paragraph 50 and the case-law cited. 26 – Engler, cited in footnote 12 above, paragraph 51. 27 – See point 11 above. 28 – See point 12 above. 29 – Which broadly correspond to Articles 5(1), 5(3) and 15 of the Regulation. 30 – See Engler, cited in footnote 12 above, paragraph 33 and the case-law cited. 31 – See point 8 above and the case-law cited in footnote 7. 32 – Case 12/76 Industrie Tessili Italiana Como [1976] ECR 1473, paragraph 13. 33 – See point 44 above. 34 – Case 38/81 Effer [1982] ECR 825, paragraphs 7 and 8, and Engler, cited in footnote 12 above, paragraph 46. While those cases concerned the equivalent wording under the Brussels Convention, I see no reason for the position to differ as regards the Regulation. See point 8 above. 35 – See to that effect, inter alia, Handte, cited in footnote 25 above, paragraph 18.