62023CJ0351_RES
Case C‑351/23
GR REAL s. r. o.
v
POandRT
(Request for a preliminary ruling from the Krajský súd v Prešove)
Judgment of the Court (Grand Chamber) of 24 June 2025
(Reference for a preliminary ruling – Consumer protection – Unfair terms in consumer contracts – Directive 93/13/EEC – Article 6(1) – Article 7(1) – Consumer credit contract – Contract secured by a charge over immovable property constituting the consumer’s family home – Early recovery of the loan – Extrajudicial sale by auction of that immovable property – National legislation allowing that sale to be made without prior verification, by a court, of the debt concerned – Grounds for the annulment of that sale excluding the existence of unfair terms – Effectiveness of the protection afforded to consumers – Articles 7 and 47 of the Charter of Fundamental Rights of the European Union)
Consumer protection – Unfair terms in consumer contracts – Directive 93/13 – Scope – Legal proceedings initiated by a company making the successful bid for a consumer’s family home sold in the context of extrajudicial proceedings for the enforcement of a mortgage granted over that property by that consumer, and seeking the eviction of that consumer – Counter-claim brought by the consumer in the context of those proceedings, seeking to challenge the lawfulness of the transfer of ownership of that family home – Included – Conditions
(Council Directive 93/13, Arts 6(1) and 7(1))
(see paragraphs 63-74, 77, 79-83, operative part 1)
Consumer protection – Unfair terms in consumer contracts – Directive 93/13 – Means to prevent the use of unfair terms – National legislation allowing proceedings for the extrajudicial enforcement of a mortgage granted by a consumer on his or her family home to continue, despite the existence of a pending application for an interim measure and corroborating evidence as to the possible presence of a potentially unfair term in the contract on which that enforcement was based – Legislation not enabling the annulment by judicial means to be obtained of that enforcement on the ground that there was such a term in that contract – Not permissible
(Council Directive 93/13, Arts 6(1) and 7(1))
(see paragraphs 88-105, operative part 2)
Résumé
Seised of a request for a preliminary ruling by the Krajský súd v Prešove (Regional Court, Prešov, Slovak Republic), the Court of Justice, sitting as the Grand Chamber, rules on the protection offered to consumers by Directive 93/13, (
1
) read in the light of the fundamental rights to accommodation and effective judicial protection, (
2
) in the context of a dispute between two consumers, on the one hand, and, on the other, the successful bidder for the family home of those consumers, concerning (i) the eviction of the latter from that home following its acquisition by the successful bidder and (ii) a counterclaim by which those consumers challenged the lawfulness of the transfer of ownership of that immovable property. The Court also examines the conditions under which extra-judicial proceedings for the enforcement of a mortgage, once initiated, should continue in order for those fundamental rights, and the requirements provided for by Directive 93/13, to be observed.
On 7 April 2011, PO and RT, the defendants, concluded a loan contract with a Slovak credit institution (‘the bank’) for EUR 63000 repayable in monthly instalments. The final payment under that loan contract was due to be made on 20 January 2030. A term contained in the general conditions applied by the bank provided for early repayment in the event of a delay in payment. The loan contract provided for a mortgage on the family home of those defendants.
On 3 November 2016, on account of a delay in payment of those monthly instalments by the defendants, the bank declared the loan immediately payable and requested those defendants to pay in its entirety the remainder of the sum due under that loan contract. It also lodged an application for enforcement of the mortgage by means of an extrajudicial sale by auction of the immovable property concerned.
On 21 April 2017, the defendants in the main proceedings brought an action before the Okresný súd Prešov (District Court, Prešov, Slovak Republic), seeking that the bank be ordered to abstain from enforcing that mortgage and, by way of an interim measure, the suspension of enforcement of that mortgage until the main proceedings had been definitively concluded.
On 25 April 2017, the first round of the auction took place without any bids being made.
By an order of 26 May 2017, the District Court, Prešov, rejected the defendant’s application for an interim measure. Those defendants brought an appeal against that order before the Regional Court, Prešov. On 18 July 2017, before that court was able to give its decision, the immovable property concerned was acquired, in a second round of the auction, by the applicant, GR REAL, a company operating inter alia in the sector of loans and the management and maintenance of immovable property. That sale took place even though PO opposed the enforcement of the mortgage at issue on the ground that the judicial proceedings seeking to prevent that enforcement were still ongoing, and that both the auctioneer and the successful bidder had been informed that there was a pending legal challenge to the enforcement.
On 9 August 2017, the Regional Court, Prešov, set aside the order of 26 May 2017 and ordered that the defendants’ application for an interim measure be reconsidered, on the ground, inter alia, that the District Court, Prešov, should have examined the defendant’s objections concerning the absence of an agreement on the acceleration clause.
On 19 December 2017, the defendants withdrew the action brought on 21 April 2017, on account of the sale of the immovable property concerned. Accordingly, on 11 January 2018, the District Court, Prešov, closed the proceedings.
Following the refusal of the defendants to vacate the immovable property concerned, that being their sole residence and the property that they occupied with their children, two of whom were minors, the applicant brought eviction proceedings before the District Court, Prešov. The rejection of that action by that court was confirmed on appeal by the Regional Court, Prešov.
By an order of 8 April 2021, the Najvyšší súd Slovenskej republiky (Supreme Court of the Slovak Republic) set aside the decisions of both those courts and referred the case back to the District Court, Prešov, in order that that latter court examine the right of ownership of the applicant. The District Court, Prešov, upheld the applicant’s action and ordered the defendants to vacate the property concerned, rejecting their application seeking to challenge the lawfulness of the sale of that property.
Both the applicant and the defendants appealed that decision before the Regional Court, Prešov, which is the referring court. Before that court, the defendants claim a failure to observe their rights as consumers and their right to accommodation.
First, the referring court expresses doubts as to the compliance of the acceleration clause in the loan contract at issue with the requirement of transparency, given that that term was included in the bank’s general conditions but allegedly was not brought to the defendants’ knowledge. Secondly, that court raises the issue of whether, under Directive 93/13, the successful bidder for immovable property in an extrajudicial sale at auction, informed of pending judicial proceedings concerning the validity of the term on which that sale was based, enjoys absolute protection or if that protection could be limited, having regard, in particular, to the proactive conduct of the consumers concerned in order to defend themselves against that enforcement by claiming that that term is unfair, and to the doubts in relation to the good faith of that company.
Findings of the Court
In the first place, the Court examines whether the judicial proceedings at issue in the main proceedings fall within the scope of Directive 93/13. (
3
)
The Court thus recalls that, in order to determine whether Directive 93/13 may usefully be relied on in such proceedings, it is necessary to examine the subject matter of those proceedings and the specific features of the dispute of which they form part, and the possible presence of a potentially unfair term in the mortgage loan contract which formed the subject matter of such proceedings.
As regards, in the first place, the subject matter of the proceedings, the Court reiterates its case-law under which Directive 93/13 cannot usefully be relied on, in principle, in a dispute which concerns the protection of real rights derived from title lawfully acquired by a seller or supplier following a sale by auction. (
4
) It also points out that a national court cannot carry out an examination of the unfairness of contractual terms which would lead to the annulment of the acts transferring ownership of immovable property in a situation in which the mortgage enforcement procedure which led to that transfer has ended and the ownership rights in that property have been transferred to a third party, without the lawfulness of the transfer being challenged. (
5
) In that context, the Court states that the subject matters of the actions at issue in the main proceedings can be distinguished from those at issue in its aforementioned case-law. A special feature of the dispute in the main proceedings is that the referring court is seised (i) of an action for the eviction of the defendants from their family home, brought by the applicant in the exercise of its right to ownership acquired in the extrajudicial sale at auction of that home, and (ii) of a counterclaim by which the defendants challenge the lawfulness of the transfer of ownership of that home to the applicant, on the ground that the conditions in which that transfer took place do not meet the requirement of effective judicial protection. (
6
)
Consequently, unlike the dispute which was at issue in the case which gave rise to the judgment in Banco Santander, (
7
) the dispute in the main proceedings concerns not only the protection of real property rights acquired following a sale of immovable property by auction, but also the conditions under which the proceedings for enforcement of the mortgage granted over that property may have led to the transfer of those rights to the company making the successful bid. In the present case, in their counter-claim, the defendants in the main proceedings do not rely, against the transferee of immovable property, which is a third party to the mortgage loan contract in relation to that property, on grounds for the annulment of that contract or some of its terms, but dispute the very lawfulness of the transfer of ownership of that property to that transferee.
Second, as regards the specific features of the dispute of which the enforcement proceedings form part, and, specifically, the consumers’ attitude in relation to the extra-judicial enforcement proceedings at issue, the Court points out that that cannot be regarded as completely passive.
The defendants brought an action seeking to prevent the continuation of those proceedings, attaching an application for an interim measure seeking the suspension of the proceedings. According to the referring court, that legal remedy would have been the only means of opposing the performance of an extrajudicial sale by auction. Subject to the assessment which it is for that court to carry out, the fact that, after the sale by auction, those defendants withdrew that action cannot call into question the finding that those defendants did not remain passive, because they could reasonably consider that the action concerned had become devoid of purpose.
Moreover, the referring court states that the defendants informed the applicant, at the second round of the auction, of the existence of a pending application for an interim measure to suspend the enforcement of the mortgage concerned. That assessment of the facts is a matter for the national court and binds the Court of Justice, although the applicant disputes that it was informed of the existence of such an application.
Third, the referring court takes the view that corroborating evidence existed, on the date of the sale by auction, as to the possible presence of a potentially unfair term in the contract on which the enforcement of the mortgage concerned was based. It expresses doubts as to whether the acceleration clause which led to that enforcement complies with the requirement of transparency.
Having regard to the foregoing, the Court of Justice considers that, unlike the case which gave rise to the judgment in Banco Santander, (
8
) the defendants did not remain passive in the extrajudicial enforcement proceedings. On the contrary, they made use of the legal remedies provided for by the national legislation in order to oppose that enforcement, while informing the persons concerned by that enforcement of their actions. However, those enforcement proceedings continued and culminated in the sale by auction of their family home, in the absence of any judicial review of the basis of the debt of which the bank sought payment, even though there was corroborating evidence as to the potential unfairness of the acceleration clause on which that enforcement was based. In such circumstances, the protection of the legal certainty of a transfer of ownership already carried out in respect of a third party (
9
) cannot be regarded as absolute.
Consequently, the Court finds that the scope of Directive 93/13, (
10
) read in the light of the rights to accommodation and effective judicial protection, (
11
) covers judicial proceedings in which (i) the company which was the successful bidder for a property constituting the family home of a consumer, sold in the context of extrajudicial enforcement of a mortgage granted over that property by that consumer for the benefit of a creditor acting in the course of trade, applies for the eviction of that consumer and (ii) the consumer challenges, by means of a counterclaim, the lawfulness of the transfer of ownership of that property to that company making the successful bid, that transfer taking place despite court proceedings which were still pending at the time of that transfer and which sought suspension of the enforcement of that mortgage on the ground that there were unfair terms in the contract on which that enforcement was based, the company making the successful bid having been previously informed of those pending proceedings by that consumer. That applies in so far as, at the time of the sale concerned, there was corroborating evidence that the terms were potentially unfair and that the consumer had availed him or herself of the legal remedies that an average consumer could reasonably be expected to avail him or herself of with a view to obtaining judicial review of those terms.
In the second place, the Court finds that Directive 93/13, read in the light of the rights to accommodation and to effective judicial protection, precludes national legislation (
12
) which allows extrajudicial enforcement of a mortgage, granted by a consumer for the benefit of a creditor acting in the course of trade, on immovable property constituting that consumer’s family home to continue despite the existence of a pending application before a court for an interim measure seeking suspension of that enforcement, and corroborating evidence as to the possible presence of a potentially unfair term in the contract on which that enforcement was based. That applies where that legislation does not provide for any possibility of obtaining by judicial means the annulment of that enforcement on the ground that there are unfair terms in that contract.
In the present case, subject to the verifications which it is for the referring court to carry out, the legal remedies available to the defendants on the date of the sale by auction at issue did not meet the requirement of effective judicial protection.
First, those legal remedies did not offer an effective possibility to suspend performance of that sale by auction, in the context of enforcement proceedings, to enable the judicial review of a potentially unfair term in the contract giving rise to that enforcement, even though an application for suspension was pending before a court. Article 7(1) of Directive 93/13 requires that the consumer is not deprived of the effective possibility of obtaining the suspension of enforcement proceedings brought pursuant to an enforceable instrument based on a contractual term the validity of which is challenged before the courts on the ground that it is unfair. In the absence of that suspension, a decision finding that that term is unfair would afford that consumer only subsequent protection of a purely compensatory nature, which would be incomplete and insufficient. That requirement is all the more justified where, as in the present case, the enforcement proceedings concern the home of the consumer and his or her family, the protection of which falls within the scope of the fundamental right to respect for private and family life. (
13
)
Secondly, those legal remedies did not provide the defendants with the possibility to apply for the annulment of that sale by auction on account of the presence of an unfair term in the contract on which that sale was based, (
14
) despite the existence of consistent evidence as to the potential unfairness of that term.
The Court adds that, having regard to the recent case-law of the Supreme Court of the Slovak Republic on the Law on Voluntary Auctions, (
15
) the possibility of an interpretation of that law (
16
) which is consistent with the provisions of Directive 93/13 does not appear to be precluded. In that regard, if the referring court takes the view that it is open to it to so interpret that law, as regards the grounds for annulment provided for in it, that law also provides that an application for annulment must be filed within three months of the date of the acceptance of the winning bid. Subject to verification by the referring court, the defendants could not reasonably be expected to bring an application for annulment of the sale by auction concerned on the basis of the Law on Voluntary Auctions inasmuch as they could not have anticipated the interpretation made of that law by the Supreme Court of the Slovak Republic five years after that sale.
The importance of the public interest underlying the protection which that directive confers on consumers and the need to ensure the effectiveness of the rights which individuals derive from that directive, warrant, in the absence of effective remedies enabling them to assert their rights under that directive before the date of the acceptance of the winning bid, the defendants in the main proceedings not being time-barred from challenging the enforcement having given rise to that acceptance.
The Court also states that since the referring court might find that the sale by auction is void and, consequently, restore the legal relationship between the defendants and the bank before that sale was carried out, that court should examine, in the light of the applicable national law, the possibility of allowing that bank to participate in the proceedings, in accordance with any appropriate procedural rules.
(
1
)	Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts (OJ 1993 L 95, p. 29).
(
2
)	Article 7 of the Charter of Fundamental Rights of the European Union (‘the Charter’), relating to respect for private and family life, guarantees the right to accommodation, while Article 47 of the Charter provides for the right to effective judicial protection.
(
3
)	And specifically, the scope of Article 6(1) and Article 7(1) of Directive 93/13.
(
4
)	Judgment of 7 December 2017, Banco Santander (Case C‑598/15, EU:C:2017:945, paragraphs 44 and 47).
(
5
)	Judgment of 17 May 2022, Ibercaja Banco (C‑600/19, EU:C:2022:394, paragraph 57).
(
6
)	As provided for by Article 47 of the Charter and Article 7(1) of Directive 93/13.
(
7
)	Judgment of 7 December 2017, Banco Santander (C‑598/15, EU:C:2017:945).
(
8
)	Judgment of 7 December 2017, Banco Santander (C‑598/15, EU:C:2017:945).
(
9
)	To which the Court referred in the judgments of 7 December 2017, Banco Santander (C‑598/15, EU:C:2017:945, paragraph 45), and of 17 May 2022, Ibercaja Banco (C‑600/19, EU:C:2022:394, paragraph 57).
(
10
)	And specifically Article 6(1) and Article 7(1) of Directive 93/13.
(
11
)	Articles 7 and 47 of the Charter.
(
12
)	Zákon č. 527/2002 Z. z. o dobrovol’ných dražbách a o doplnení zákona Slovenskej národnej rady č. 323/1992 Zb. o notároch a notárskej činnosti (Notársky poriadok) v znení neskorších predpisov (Law No 527/2002 on voluntary auctions and amending the Law of the Slovak National Council No 323/1992 on notaries and notarial activity (the Notarial Code)) (‘the Law on Voluntary Auctions’).
(
13
)	Article 7 of the Charter.
(
14
)	Paragraph 21(2) of the Law on Voluntary Auctions provides for the right to apply for annulment of a sale within three months of the date of the acceptance of the winning bid, in the event of a challenge to the validity of the contract creating the charge concerned or of infringement of the provisions of that Law.
(
15
)	In its written observations, the Slovak Government submits that in case-law dating from 2022, confirmed in 2023, the Supreme Court of the Slovak Republic interpreted Paragraph 21(2) of the Law on Voluntary Auctions to the effect that the existence of unfair terms in the contract on which an extrajudicial enforcement is based constitutes a ground for annulling the sale made in the context of that enforcement.
(
16
)	Specifically, Paragraph 21(2) of the Law on voluntary auctions.