OPINION OF ADVOCATE GENERAL

TRSTENJAK

delivered on 8 September 2009 1( )

Case C‑215/08

E. Friz GmbH

v

Carsten von der Heyden

(Reference for a preliminary ruling from the Bundesgerichtshof (Germany))

(Directive 85/577/EEC – Consumer protection in respect of contracts negotiated away from business premises – Scope – Entry into a closed-end real property fund established in the form of a civil-law partnership (societas) – Renunciation – Effect ex nunc)









Table of contents





I – Introduction

II – Legal framework

A – Community law

B – National law

III – Facts, main proceedings and questions referred

IV – Procedure before the Court

V – Arguments of the parties

A – Admissibility

B – First question referred

C – Second question referred

VI – Advocate General’s assessment

A – Introduction

B – Admissibility

C – First question referred

1. Two fundamental concepts

a) Closed-end real property fund

b) Civil-law partnership

2. Does entry into a closed-end real property fund established in the form of a civil-law partnership fall within the scope of Directive 85/577?

a) Conditions governing the existence of a contract under Directive 85/577

b) Exceptions provided for in Article 3(2) of Directive 85/577

i) Contracts relating to immovable property

ii) Contracts for securities

3. Scope of the German HWiG

4. Proposed answer to the first question

D – Second question referred

1. Notice of right of renunciation?

2. Analysis of the substance

3. Proposed answer to the second question

E – Conclusion

VII – Conclusion





I – Introduction

1. This case, which concerns the interpretation of Council Directive 85/577/EEC of 20 December 1985 to protect the consumer in respect of contracts negotiated away from business premises ( ) (‘Directive 85/577’), raises two questions of law. It raises, first, the question of the application of Directive 85/577 to entry into a closed-end real property fund established in the form of a civil-law partnership, and, secondly, the question whether the legal consequences of withdrawing from that fund carry effects ex tunc or ex nunc.

2. What is special about this case is the fact that the issues which it raises fall into two areas of law: consumer protection law and company law. In this context, in order to give a ruling, the Court will have to take account of the particular features of the partnership agreement on the basis of which the civil-law partnership is established and determine whether Directive 85/577, which was drawn up to apply to synallagmatic contracts, likewise applies where a new partner joins the partnership, thus becoming a contracting party to the partnership agreement. At the same time, the characteristics of a civil-law partnership, which is based on the principle of equality between partners, will be significant when assessing the effects of withdrawal from the partnership since, if the other partners are themselves consumers within the meaning of Directive 85/577, all the consumers must be protected, not just the consumer who withdraws from the partnership. It will therefore be impossible in this case to follow blindly a literal interpretation of the provisions of that directive. Account will also have to be taken, inter alia, of its purpose, although this will involve a departure from the strictly literal meaning of its provisions.

3. In terms of its substance, this case has to do with the wider issue of the acquisition of holdings in old real property in Germany known as ‘Schrottimmobilien’ (junk property). ( ) Investment in such property, which Germans opted for primarily on account of the resultant tax benefits, has often failed to deliver the expected results, and investors have therefore looked for ways of terminating those investments by relying inter alia on the Community directives concerning consumer protection. Thus, in Schulte ( ) and Crailsheimer Volksbank, ( ) the Court has already considered this issue in a similar context but in connection with a different point of law. In Schulte, it expressly held that the cancellation of the contract which the consumer had concluded away from the trader’s business premises must result in the restoration of the status quo ante. ( ) In this case, it will therefore be necessary to establish whether this can likewise be applied without restriction to a consumer’s withdrawal from a closed-end real property fund established in the form of a civil-law partnership.

II – Legal framework

A – Community law

4. Article 1(1) of Directive 85/577 provides:

‘This Directive shall apply to contracts under which a trader supplies goods or services to a consumer and which are concluded:

…

– during a visit by a trader:

(i) to the consumer’s home or to that of another consumer;

…

where the visit does not take place at the express request of the consumer.’

5. Article 2 of Directive 85/577 provides:

‘For the purposes of this Directive: “consumer” means a natural person who, in transactions covered by this Directive, is acting for purposes which can be regarded as outside his trade or profession; “trader” means a natural or legal person who, for the transaction in question, acts in his commercial or professional capacity, and anyone acting in the name or on behalf of a trader.’

6. Article 3(2) of Directive 85/577 provides:

‘This Directive shall not apply to:

(a) contracts for the construction, sale and rental of immovable property or contracts concerning other rights relating to immovable property. Contracts for the supply of goods and for their incorporation in immovable property or contracts for repairing immovable property shall fall within the scope of this Directive;

…’

7. Article 4 of Directive 85/577 provides:

‘In the case of transactions within the scope of Article 1, traders shall be required to give consumers written notice of their right of cancellation within the period laid down in Article 5, together with the name and address of a person against whom that right may be exercised. Such notice shall be dated and shall state particulars enabling the contract to be identified. It shall be given to the consumer:

(a) in the case of Article 1(1), at the time of conclusion of the contract;

…

Member States shall ensure that their national legislation lays down appropriate consumer protection measures in cases where the information referred to in this Article is not supplied.’

8. Article 5 of Directive 85/577 provides:

‘1. The consumer shall have the right to renounce the effects of his undertaking by sending notice within a period of not less than [( )] seven days from receipt by the consumer of the notice referred to in Article 4, in accordance with the procedure laid down by national law. It shall be sufficient if the notice is dispatched before the end of such period.

2. The giving of the notice shall have the effect of releasing the consumer from any obligations under the cancelled contract.’

9. Article 7 of Directive 85/577 provides:

‘If the consumer exercises his right of renunciation, the legal effects of such renunciation shall be governed by national laws, particularly regarding the reimbursement of payments for goods or services provided and the return of goods received.’

10. Article 8 of Directive 85/577 provides:

‘This Directive shall not prevent Member States from adopting or maintaining more favourable provisions to protect consumers in the field which it covers.’

B – National law

11. Directive 85/577 was transposed into German law by the Gesetz über den Widerruf von Haustürgeschäften und ähnlichen Geschäften (Law on the cancellation of doorstep transactions and analogous transactions) of 16 January 1986 ( ) (the ‘HWiG’). That law was still in force at the time of the facts, but was repealed on 1 January 2002 by the Gesetz zur Modernisierung des Schuldrechts (Law on the modernisation of the law of obligations) of 26 November 2001. ( )

12. Paragraph 1(1) of the HWiG provides:

‘Where the customer was induced to make a declaration of intention to conclude a contract for a service for valuable consideration:

1. by oral negotiations at his place of work or in a private home,

…

that declaration of intention takes effect only if the customer does not give written notice revoking it within a period of one week.’

13. Paragraph 3(1) of the HWiG provides:

‘In the event of cancellation, each contracting party shall return to the other whatever it has received. Damage to or loss of the object or any other matter preventing the return of the object shall not preclude cancellation. If the customer is liable for the damage, loss or other matter preventing return, he shall pay the difference in value or the value of the object to the other contracting party.’

III – Facts, main proceedings and questions referred

14. On 23 July 1991, on the basis of negotiations which took place in his private home, Carsten von der Heyden entered a closed-end real property fund established in the form of a civil-law partnership. The object of this real property fund, which had 46 partners, was the repair, modernisation and administration of a property situated at Bergstraße 9 in Berlin. The manager of that real property fund is the company E. Friz GmbH. It is unclear from the facts as set out in the order for reference whether the company E. Friz GmbH is itself also a partner in the real property fund.

15. On 6 August 2002, Mr von der Heyden renounced the effects of his undertaking, in accordance with the HWiG; ( ) more specifically, he withdrew from the closed-end real property fund. In its capacity as manager of the fund, the company E. Friz GmbH sought from Mr von der Heyden payment of a sum of EUR 16 319 on account of the negative balance corresponding to the difference between the value of the amount paid by Mr von der Heyden at the time of his entry into the fund and the contribution to the losses carried by the real property fund at the time when he terminated the effects of his undertaking.

16. Although the court of first instance allowed that claim, the appellate court dismissed it on appeal by Mr von der Heyden. The appellate court took the view that exercise of the right of renunciation by a partner must not create for that partner an obligation towards the partnership to pay any amount whatsoever, since this would entail an infringement of the provisions of Directive 85/577, under which, in such circumstances, the consumer is released from any obligations under the cancelled contract.

17. The company E. Friz GmbH brought an appeal on a point of law against the judgment of the appellate court before the Bundesgerichtshof (Federal Court of Justice; ‘the referring court’). In the order for reference, the referring court states that, in accordance with national case-law, a partner who has joined a partnership following a doorstep transaction and who subsequently renounces the effects of his undertaking is not released from all his contractual obligations with effect ex tunc, rather such renunciation produces effects ex nunc. It follows that the partner does not have an automatic right to reimbursement of the contribution that he made to the partnership. Instead, the share due to him from the partnership’s profits or the share of the loss which he must bear is calculated on the day of his withdrawal.

18. It is therefore clear from the principles of that case-law in relation to a ‘defective partnership’ (fehlerhafte Gesellschaft) that exercise of the right of renunciation does not have the effect of restoring the status quo ante. Consequently, the referring court asks whether that case-law is consistent with the interpretation of Directive 85/577 established by the Court in Schulte, in which it held that exercise of the right of cancellation under Article 5(1) of Directive 85/577 has the effect, under paragraph 2 of that article, of releasing the consumer from any obligations under the cancelled contract, which includes the restoration of the status quo ante. ( )

19. In those circumstances, by order of 5 May 2008, the referring court decided to stay proceedings and refer to the Court the following two questions for a preliminary ruling: ( )

‘(1) Must the first sentence of Article 1(1) of Council Directive 85/577/EEC of 20 December 1985 to protect the consumer in respect of contracts negotiated away from business premises be interpreted as meaning that it applies to a consumer’s entry into a partnership, commercial partnership, association or cooperative if the principal purpose of joining is not to become a member of the partnership, association or cooperative but – as frequently applies in particular in relation to participation in a closed-end real property fund – participation as a member is simply another means of capital investment or of obtaining services which are typically the object of reciprocal contracts?

(2) Must Article 5(2) of Council Directive 85/577/EEC of 20 December 1985 to protect the consumer in respect of contracts negotiated away from business premises be interpreted as meaning that it precludes a legal effect under national (judge-made) law within the meaning of Article 7 of the directive which states that, where a consumer becomes a member following a doorstep transaction, the consequence is that, if the membership is cancelled, the consumer cancelling the membership has a claim against the partnership, association or cooperative, calculated at the time that the cancellation takes effect, to his severance balance, that is, a sum corresponding to the value of his interest in the partnership, association or cooperative at the time of retirement from membership, with the (possible) effect that, as a result of the economic development of the partnership, association or cooperative, he either gets back less than the value of his capital contribution or even finds himself exposed to payment obligations which, because the severance balance is negative, go beyond the loss of the capital contribution paid?’

IV – Procedure before the Court

20. The order for reference of 5 May 2008 was received at the Court on 22 May 2008. By letter of 10 March 2009, the Court asked the referring court to clarify whether, when he signed the contract to enter the real property fund, Mr von der Heyden had been given written notice of his right of cancellation, in accordance with Article 4 of Directive 85/577. By letter of 19 March 2009, the referring court replied that, in the national proceedings, the appellate court had held that Mr von der Heyden had duly renounced the effects of his undertaking ( ) and that neither this fact nor the fact that he had entered the real property fund following a doorstep transaction had been disputed by the parties. In its reply, the referring court also states that, in accordance with national procedural law, it was bound by that finding and that it was not permitted to review its accuracy.

21. During the written procedure, observations were submitted by Mr von der Heyden, the German Government and the Commission of the European Communities. At the hearing on 18 June 2009, those parties presented oral argument and answered questions put by the Court.

V – Arguments of the parties

A – Admissibility

22. With regard to admissibility, Mr von der Heyden and the German Government both take the view that the questions referred are inadmissible in so far as they relate to a commercial partnership, association or cooperative, since these are hypothetical in relation to the facts of this case. They point out that the two questions are admissible in so far as they are concerned with circumstances such as those in the main proceedings, that is to say, entry into a closed-end real property fund established in the form of a civil-law partnership.

B – First question referred

23. On the substance of the case, Mr von der Heyden takes the view that entry into a closed-end real property fund established in the form of a civil-law partnership falls within the scope of Directive 85/577, since the principal purpose of such entry is not to become a partner but to make a capital investment in a real property fund. In these circumstances, the membership contract may be regarded as a contract for valuable consideration since it relates to a capital investment, more specifically ‘the purchase’ of a holding in a closed-end real property fund. To this extent, the membership contract can therefore be treated as a synallagmatic contract.

24. Mr von der Heyden further claims that Directive 85/577 also applies to this case because the object of the civil-law partnership in question is the maintenance, modernisation and administration of immovable property, which constitute services within the meaning of that directive. Moreover, he is of the opinion that, even if the Court were to find that this case did not concern a supply of goods or a provision of services, the question referred would be justified because the provisions of German law by which that directive was transposed extend the scope of the directive in so far as they are applicable to all contracts relating to performance for valuable consideration. Article 8 of Directive 85/577 permits Member States to adopt or maintain more favourable provisions to protect consumers and provisions whose scope has been extended are clearly more favourable.

25. By contrast, the German Government takes the view that Directive 85/577 does not apply in this case. It states that, in accordance with Article 1(1) of that directive, the directive is to apply to contracts between traders and consumers, and that it therefore covers only bilateral or traditional synallagmatic contracts and not multilateral contracts such as that at issue in this case. In addition, it points out that the partners of a closed-end real property fund established in the form of a civil-law partnership are often consumers, but Directive 85/577 does not apply to contracts concluded between consumers. In the view of the German Government, the existing partners likewise do not supply goods or provide a service to a consumer who enters the fund, since the purpose of the partnership agreement is to achieve the aim of the partnership. Furthermore, in its opinion, a contract to enter a real property fund falls within the exception provided for in the first indent of Article 3(2)(a) of Directive 85/577 as it belongs to the category of ‘contracts concerning other rights relating to immovable property’ to which that directive does not apply. The purpose of the real property fund at issue here is the maintenance, modernisation and administration of immovable property.

26. The Commission takes the view that the conclusion of a contract by which a consumer enters a real property fund constitutes the conclusion of a contract within the meaning of Article 1(1) of Directive 85/577 where, on the one hand, such entry creates a contractual relationship between the consumer-investor who enters the fund and the initiator of the real property fund and, on the other hand, either the partnership agreement or another contract concluded between the real property fund established in the form of a civil-law partnership and its initiator requires the latter to provide to the consumer-investor a service which falls within the framework of the initiator’s commercial or professional activity.

27. In this regard, the Commission points out that a contractual relationship must exist between the consumer-investor and the fund initiator. That relationship may be direct if the initiator is himself a partner in the fund, or indirect if there is a contractual relationship between the initiator and the fund in which the partner is a consumer-investor. In the view of the Commission, the fund initiator must also give an undertaking to the consumer to supply him with a service, for example to manage the immovable property which forms part of the fund’s assets.

28. The Commission also takes the view that a contract to enter a closed-end real property fund does not fall within the exception provided for in the first sentence of Article 3(2)(a) of Directive 85/577, which excludes from the scope of that directive ‘contracts for the construction, sale and rental of immovable property or contracts concerning other rights relating to immovable property’. The Commission points out that that exception is concerned with the nature of the performance owed by the trader and, in this case, the performance does not consist in the construction, sale or rental of immovable property, but in the management of such property with a view to securing income for the partnership.

C – Second question referred

29. Mr von der Heyden and the Commission propose that the Court should answer the second question in the affirmative. They claim that, in Schulte, ( ) the Court ruled that, under Article 5(2) of Directive 85/577, the giving of notice of cancellation has the effect of releasing the consumer from any obligations under the cancelled contract, which includes the restoration of the status quo ante both for the consumer and for the trader. In their view, the legal effects of the renunciation are indeed to be governed by national laws in accordance with Article 7 of Directive 85/577, but the Member States may exercise their powers only in a manner consistent with Community law and, in particular, with the provisions of Directive 85/577, which must be interpreted in the light of the directive’s objectives and in a way which guarantees its effectiveness. They are therefore of the opinion that a consumer must have the possibility of renouncing the effects of his undertaking with ex tunc effect, and he must therefore be entitled to reimbursement of his initial contribution and released from all obligations arising from entry into a closed-end real property fund.

30. The Commission goes on to say in this connection that the national legislature must find a solution which is consistent with Community law if such renunciation by the consumer gives rise to unfavourable consequences for the remaining partners or for the creditors of the civil-law partnership in question. In the view of the Commission, the national legislature could, for example, decide that the initiator of the partnership should take over that share of the partnership held by the partner renouncing the effects of his undertaking.

31. With regard to the second question, the German Government states that it need be answered only in the alternative, taking into account the answer to the first question. It points out that, in accordance with Article 7 of Directive 85/577, the legal effects of renunciation are to be governed by national laws. The German Government further observes that, while Directive 85/577 does seek to protect consumers from the hasty conclusion of a contract, it does not seek to afford them general protection against investments which subsequently turn out to be economically disadvantageous. The Member States are free to determine whether, and to what extent, a consumer who has renounced the effects of his undertaking must shoulder any negative consequences of that renunciation. In the German Government’s view, German law therefore rightly provides that renunciation does not have retroactive effects dating back to entry into the real property fund (ex tunc), but effects only ex nunc.

VI – Advocate General’s assessment

A – Introduction

32. This case may be categorised as relating to the issue of unsuccessful investments in old real property in Germany, an issue previously raised in Schulte ( ) and Crailsheimer Volksbank, ( ) which were both concerned with the legal effects of the cancellation of loan agreements concluded away from business premises. In this case, unlike in Schulte and Crailsheimer Volksbank, the Court will have to address the legal consequences resulting from the cancellation of a partnership agreement, more specifically the withdrawal from a real property fund established in the form of a civil-law partnership and entered into by a consumer following a doorstep transaction.

33. Real property funds in the form of investments in immovable property became very popular in Germany in the early 1980s; they grew rapidly at the beginning of the 1990s following German reunification. ( ) They fell into decline after 1998, at which time many investors lost the money they had invested. ( ) At the time of the real property funds’ decline, a number of investors withdrew from those funds, resulting in an increase in the number of court cases in which fund managers sought performance of the obligations entered into by investors. In cases in which consumers entered a fund following a doorstep transaction or elsewhere away from a trader’s business premises, German case-law permits the application of legislation to protect consumers in respect of contracts negotiated away from business premises, but allows a consumer to withdraw only with ex nunc effect, which means that the amount invested by the consumer in the fund is not necessarily returned to him in full.

34. The referring court has submitted to the Court two questions for a preliminary ruling. First, it asks whether the provisions of Directive 85/577 apply to the entry by a consumer into a closed-end real property fund established in the form of a civil-law partnership. Secondly, it asks whether the provisions of that directive preclude German case-law to the effect that such a consumer may withdraw from a closed-end real property fund with effect only ex nunc.

B – Admissibility

35. First, it is necessary to assess whether the two questions referred are inadmissible in so far as they concern membership of a commercial partnership, association or cooperative, as Mr von der Heyden and the German Government claim. In my opinion that view is to be endorsed.

36. It must be recalled that, in proceedings under Article 234 EC, which are based on a clear separation of functions between the national courts and the Court of Justice, it is solely for the national court before which the dispute has been brought, and which must assume responsibility for the subsequent judicial decision, to determine in the light of the particular circumstances of the case both the need for a preliminary ruling in order to enable it to deliver judgment and the relevance of the questions which it submits to the Court. Since both the questions submitted concern the interpretation of Community law, the Court is in principle bound to give a ruling. ( )

37. It is settled case-law that the Court may refuse to rule on a question referred for a preliminary ruling by a national court only where it is quite obvious that the interpretation of Community law that is sought bears no relation to the 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. ( )

38. It is clear from the facts set out in the order for reference that, in this case, a consumer entered a closed-end real property fund established in the form of a civil-law partnership. In my opinion, the two questions referred are therefore not admissible in so far as they concern membership of a commercial partnership, association or cooperative.

39. However, it must be pointed out that the first question also relates generally to membership of a partnership. It is true that a civil-law partnership is the main form of partnership, but the term partnership has a broader meaning since it covers civil-law partnerships and commercial partnerships. ( ) Since the facts are concerned solely with membership of a civil-law partnership, the two questions referred must be restricted exclusively to membership of such a partnership.

40. On the basis of the foregoing considerations, I propose that the Court hold that the two questions referred are admissible only in so far as they concern the entry by a consumer into a closed-end real property fund established in the form of a civil-law partnership.

C – First question referred

41. By the first question referred, the referring court asks, essentially, whether Article 1(1) of Directive 85/577 applies to the entry by a consumer into a closed-end real property fund established in the form of a civil-law partnership. I will begin by explaining the concepts of a closed-end real property fund and a civil-law partnership, before analysing whether entry into a closed-end real property fund established in the form of a civil-law partnership falls within the scope of Directive 85/577.

1. Two fundamental concepts

a) Closed-end real property fund

42. A closed-end real property fund (geschlossener Immobilienfond, fonds immobilier fermé) is a form of capital investment in immovable property. ( ) The purpose of a closed-end real property fund is normally to build or acquire one or more immovable properties and then, in principle, to rent them. ( ) However, the primary focus is the investors’ acquisition of a holding, not their investment in the immovable property. ( ) By this form of capital investment, investors are seeking either to generate a profit or to obtain tax relief. ( ) Unlike an open-ended fund, a closed-end real property fund has a limited number of investors and a predetermined amount of investment; once sufficient capital has been raised, it is invested; consequently, it is no longer possible for new investors to participate in the fund. ( )

43. Under German law, a closed-end real property fund is normally established in the form of a civil-law partnership or a limited partnership. ( ) Since, in this case, the closed-end real property fund was established in the form of a civil-law partnership, I shall set out below the main features of such a partnership that will have a bearing on the answer to the first question referred.

b) Civil-law partnership

44. The civil-law partnership (societas) dates back to Roman law and is today a feature of the legal systems of many Member States. ( ) In a civil-law partnership, the partners undertake, by means of a partnership agreement, to combine their efforts in pursuit of a common goal. The key components of a civil-law partnership are therefore: a partnership agreement concluded by at least two partners, a common goal, and partners’ contributions. I shall deal with each of those components in detail below.

45. For a partnership to come into being, at least two or more partners must conclude a partnership agreement. ( ) The partnership agreement is concluded intuitu personae, which means that the partners are bound personally and that, in principle, a partner cannot transfer his holding in the partnership to another person, unless the partnership agreement provides otherwise. ( ) If a partner withdraws from the partnership or dies, in principle the partnership ceases to exist, unless the partnership agreement provides otherwise, ( ) but the rules in this regard also vary from one Member State to another. ( ) The grounds for winding up a partnership differ between the legal systems of the Member States; the two most common grounds are the attainment of the partnership’s objective or the expiry of the period for which the partnership was established. However, in certain legal systems, the withdrawal or death of a partner also constitutes a ground for winding up, as indicated above, as do other circumstances. ( )

46. By the partnership agreement, the partners undertake to combine their efforts with a view to achieving a common goal. There must therefore be an affectio societatis, an intention on the part of the partners to form a partnership in order to achieve a common goal. ( ) The object must be lawful. ( ) It may be multifaceted, but restrictions on the exercise of an economic activity apply. ( )

47. To achieve that common goal, the partners must make contributions determined by the partnership agreement; those contributions may take different forms, but they must have a financial value, for example in the form of cash, goods or services. ( ) If a partner does not make his contribution, the other partners can force him to do so by judicial means (actio pro socio). ( )

48. It is also very important in this case to define the rights which partners hold in the partnership’s assets. It must be pointed out that this matter is regulated in different ways in the Member States. ( ) German legal literature states that German property law provides for assets known as ‘Gesamthandsvermögen’, that is to say, partnership assets managed under contractual joint ownership. These assets have two main features: first, they are separate from the partners’ private assets; secondly, disposal of them is reserved to the organs of the partnership. ( ) A particular form of ownership exists in relation to such partnership assets which is known as ‘Gesamthandseigentum’ (joint ownership). Since the German courts recognised civil-law partnerships as having legal capacity, ( ) the question whether partners always have joint ownership (Gesamthandseigentum) of the partnership assets or whether the partnership alone owns them has been a matter of dispute in German legal writings and case-law. ( ) This is clearly a question to which German legal writers and the German courts will have to provide an answer, and of which account will have to be taken in the event of the possible application of the exception provided for in Article 3(2)(a) of Directive 85/577.

2. Does entry into a closed-end real property fund established in the form of a civil-law partnership fall within the scope of Directive 85/577?

49. In this case, the question in dispute is whether entry into a closed-end real property fund established in the form of a civil-law partnership falls within the scope of Directive 85/577. It must therefore be established whether Directive 85/577, which was drafted to apply to synallagmatic contracts (contractus bilaterales aequales), also applies to multilateral contracts, such as that at issue here.

50. First, it must be pointed out that the purpose of consumer protection under Directive 85/577 is to protect consumers from hasty decisions which they may make away from a trader’s business premises. Particular protection must be guaranteed for consumers in circumstances in which a contract is concluded at the initiative of the trader, the consumer being placed in a situation characterised by an element of surprise, since he is unable to compare the quality and price of the offer with those of other offers. ( ) Since a consumer runs the risk of making a hasty decision as regards the conclusion of a contract, he must have a period of time for reflection after the contract has been concluded to consider the obligations arising from the contract and to decide whether or not to cancel that contract, in accordance with Article 5(1) of Directive 85/577, within a period of not less than seven days. ( ) Entry into a closed-end real property fund is no exception in this regard; here too a consumer may make a hasty decision which he will regret subsequently. ( )

51. However, in this case, the Court will have to take account not only of whether the consumer warrants such protection, but above all whether entry into a closed-end real property fund established in the form of a civil-law partnership constitutes the conclusion of a contract within the meaning of Article 1(1) of Directive 85/577. Before I begin analysing the substance of the case, it is necessary to explain to which contract the question referred relates.

52. In this case, Mr von der Heyden initially submitted a declaration of membership (Beitrittserklärung) of a closed-end real property fund established in the form of a civil-law partnership. When he made that declaration of membership, he was simply expressing his wish to enter the fund, more specifically to become a partner in it. As is clear from the declaration of membership, his membership took effect only when the manager of that partnership received the declaration in writing. At the same time, Mr von der Heyden concluded a partnership agreement with the other partners; more specifically, he became a partner at that time of the closed-end real property fund. In this case, the partnership agreement was therefore in the nature of a multilateral contract between partners. When Mr von der Heyden cancelled the partnership agreement, he ceased to be a partner in the real property fund. The first question referred is therefore concerned with whether Directive 85/577 applies to the conclusion of the partnership agreement between Mr von der Heyden and the other partners.

53. For a contract to exist for the purpose of Article 1(1) of Directive 85/577, several conditions have to be met in relation to the two contracting parties, the subject-matter of the contract and the place of the contract’s conclusion. First, one contracting party must be a consumer; secondly, the other contracting party must be a trader; ( ) thirdly, the contract must relate to the supply of goods or services to the consumer; and, fourthly, the contract must be concluded either during an excursion organised by the trader away from his business premises, or at the consumer’s home, the home of another consumer or the consumer’s place of work, where the visit does not take place at the express request of the consumer.

54. In this case, it is also necessary to establish whether the contract concluded is covered by one of the exceptions provided for in Article 3(2), in particular whether it falls within the exception provided for in Article 3(2)(a) of Directive 85/577, which excludes from the scope of that directive contracts for the construction, sale and rental of immovable property or contracts concerning other rights relating to immovable property, or whether it is covered by the exception provided for in Article 3(2)(e) of that directive, which excludes from its scope contracts for securities.

a) Conditions governing the existence of a contract under Directive 85/577

55. The first condition (one contracting party must be a consumer), the third condition (supply of goods or services) and the final condition (conclusion away from a trader’s business premises) governing the existence of a contract within the meaning of Article 1(1) of Directive 85/577 are, in my opinion, satisfied in this case. However, I take the view that the second condition (the second contracting party must be a trader) is not met.

56. Under Article 2 of Directive 85/577, ‘“consumer” means a natural person who, in transactions covered by this Directive, is acting for purposes which can be regarded as outside his trade or profession’. It is common ground in this case that Mr von der Heyden did not act in the context of his trade or profession, and he is therefore a consumer within the meaning of Directive 85/577. ( )

57. It is also common ground that the contract to enter the real property fund was concluded away from the trader’s business premises since it was concluded at the consumer’s home.

58. In addition, it is my view that entry into a closed-end real property fund is open to classification as a supply of goods. It is true that this case certainly does not concern a supply of goods within the meaning of traditional consumer contracts such as contracts of sale, for example. However, account must be taken of the fact that the contract is concerned with the acquisition of a holding in that fund, which may, in my view, be covered by the broad concept of supply of goods. Such a broad interpretation of that concept is also consistent with the Court’s case-law to date, in which it has adopted a broad interpretation of the concept of the supply of goods or services and, in so doing, has conferred a broad scope on Directive 85/577.

59. In Dietzinger, ( ) for example, the Court thus regarded a contract of guarantee as falling within the scope of Directive 85/577. In its reasoning, the Court stated that it should be noted that, apart from the exceptions listed in Article 3(2), the scope of the directive is not limited according to the nature of the goods or services to be supplied under a contract; the only requirement is that the goods or services must be intended for private consumption. ( ) In Travel-Vac, ( ) the Court held that Directive 85/577 applies to a time-share contract where the contract includes not only the right to use the property on a time-share basis but also the provision of separate services of a value higher than that of the right to use the property. ( ) In Heininger, ( ) the Court held that Directive 85/577 applies to loan agreements. It later applied that directive to loan agreements in Schulte, ( )Crailsheimer Volksbank, ( ) and Hamilton. ( )

60. However, the second condition governing the existence of a contract within the meaning of Article 1(1) of Directive 85/577, that is to say, that the second contracting party must be a trader within the meaning of that directive, is in dispute in this case.

61. Under Article 2 of Directive 85/577, ‘“trader” means a natural or legal person who, for the transaction in question, acts in his commercial or professional capacity, and anyone acting in the name or on behalf of a trader’. ( ) In view of this definition, it is first of all necessary to determine whether in this case there is a trader within the meaning of Article 2 of Directive 85/577.

62. It is clear from the declaration by which Mr von der Heyden entered the closed-end real property fund that that declaration was signed by Mr von der Heyden and the company Roland GmbH. ( ) Beneath the signature of Mr von der Heyden appear the words ‘partner’s signature’ (Unterschrift Gesellschaftler); beneath the signature of the company Roland GmbH, the words ‘intermediary’s signature’ (Unterschrift Vertriebspartner). It is clear from this declaration of membership that Mr von der Heyden thereby joined the partnership ‘Grundstücksgesellschaft Bergstr. 9’ after the manager of that partnership had received written notification of his membership. In so doing, Mr von der Heyden therefore became a contracting party to the partnership agreement and a partner in the civil-law partnership.

63. It is therefore necessary to establish whether, in the contractual relationship between the consumer who joins the partnership and the other partners in that partnership (partnership agreement), it is possible to identify a ‘trader’ within the meaning of Directive 85/577.

64. There are in theory three possibilities in relation to this contractual relationship.

65. First possibility: all the partners in the civil-law partnership are consumers. In this case, Directive 85/577 definitely cannot apply to this contractual relationship, because the definition of ‘trader’ in Article 2 of Directive 85/577 requires that that person must be acting in his commercial or professional capacity, which cannot be said to be the case where the partners are consumers. In addition, if the other partners are themselves consumers, protection is afforded not just to one of them but to all the consumers who are partners in that partnership. Community law on consumer protection does not apply to relationships between consumers, and therefore not to C2C (consumer-to-consumer) relationships, but only to relationships between traders and consumers, that is to say, B2C (business-to-consumer) relationships. ( )

66. Second possibility: all the other partners in the civil-law partnership are traders within the meaning of Directive 85/577, with the exception of the partner who renounces the effects of his undertaking under that directive. If, in this case, all the other partners in the civil-law partnership were, for example, natural or legal persons whose professional activity consisted in the creation of closed-end real property funds and the sale of holdings to new partners, this argument might be relied on and, in those circumstances, Directive 85/577 would apply to this contractual relationship. However, that argument cannot be extended to this case because, as the referring court states in its order, in the case of a closed-end real property fund established in the form of a civil-law partnership, the other partners are, as a general rule, also consumers. ( )

67. Third possibility: some partners in the civil-law partnership are consumers, others are not. In such a case, it would be necessary to establish in respect of each of the individual partners falling within the latter category whether that partner could be classified as a trader within the meaning of Directive 85/577. This is a task for the national court, but the Court may in theory consider whether Directive 85/577 could be applied if the national court were to find that only certain partners may be classified as traders within the meaning of that directive. In this context, it is not possible, in my opinion, to rely on the argument that, since certain partners are traders within the meaning of Directive 85/577, the other partners are likewise assigned the status of trader within the meaning of that directive. Such a solution would be contrary to the requirement to protect all the partners in that partnership who are consumers. Similarly, the solution to the effect that only the partners having the status of traders within the meaning of Directive 85/577 should be financially liable if the partnership agreement is cancelled by a consumer is not readily acceptable from the point of view of company law. A partnership agreement is based on the principle of equality of the partners and the consumer in this case cancelled the agreement which had been concluded with all the partners and not only with those having the status of trader within the meaning of Directive 85/577. In addition, although it is ultimately for the national court to conduct such an assessment, the point must be made that, in this case, it is not clear from the description of the facts set out in the order for reference that the partners who are not consumers are traders within the meaning of Directive 85/577. I am therefore of the opinion that Directive 85/577 is not applicable in this case.

68. Next, it must be determined whether the initiator and founder of the closed-end real property fund may be regarded as a ‘trader’ within the meaning of Directive 85/577. ( ) The role of initiator and founder is of crucial importance to the fund, since it is that person who creates the fund and then endeavours to attract partners who will invest capital in it. As far as the initiator and founder is concerned, it can certainly be argued that the condition relating to activity in the context of commercial or professional activity is met, but the question remains whether that person may be regarded as a trader within the meaning of Directive 85/577. It is true that the initiator ‘sells holdings’ in the fund but he does not receive, on doing so, the full amount of the sum invested by the consumer. When a new partner joins, the initiator receives only a commission, ( ) whereas the contribution invested by the partner is used to achieve the partners’ common goal. It is true that, on account of that commission, the initiator has an interest in the consumer’s entry into the fund, but he does not receive the sum invested.

69. It must be recognised that Directive 85/577 does not expressly require that a consumer contract should be a contract for valuable consideration. However, I take the view that it can be inferred from the scheme of that directive that, in the case of a contract for valuable consideration, the trader must receive the payment from the consumer. In accordance with Article 5(2) of Directive 85/577, on the cancellation of the contract, the consumer is released from any obligations under the cancelled contract. This means that the trader must return to the consumer the amount that the consumer had paid to him. ( ) Since, in this case, the initiator receives only a commission from the consumer, the consumer could at most seek reimbursement of that amount from him.

70. I therefore take the view that the initiator and founder of the fund cannot be regarded as a trader within the meaning of Directive 85/577.

71. Nor, in this case, can the intermediary be defined as a ‘trader’ within the meaning of Directive 85/577. In addition to the contractual relationship between the partners, there is also in this case a relationship between the consumer joining the partnership and the intermediary. A consumer who enters a fund following a doorstep transaction is normally in a situation in which he is faced with an intermediary of that partnership who attempts to convince him to join the partnership. There is no doubt that the intermediary himself also has an interest in convincing the consumer to join the fund, since he receives a commission when new partners enter the closed-end real property fund. ( ) Furthermore, the intermediary is the person who is in direct contact with the consumer and who, on the basis of the power of attorney conferred by the partnership, has an obligation to inform the consumer of his right of renunciation.

72. In this case, the intermediary could be regarded as a ‘trader’ within the meaning of Article 2 of Directive 85/577 only if he ‘(were) acting in the name or on behalf of a trader’, and therefore only if the person in whose name or on whose behalf the intermediary acts could be classified as a ‘trader’. However, as is clear from points 60 to 70 of this Opinion, that condition is not satisfied in this case. Consequently, I take the view that the intermediary cannot be regarded as a ‘trader’ within the meaning of Directive 85/577.

b) Exceptions provided for in Article 3(2) of Directive 85/577

73. If the Court were none the less to hold that this case does concern a contract within the meaning of Article 1(1) of Directive 85/577, it is also necessary, finally, to answer the question whether the contract at issue falls within one of the exceptions provided for in Article 3(2) of Directive 85/577. In this connection, account will have to be taken of the general principle that, in accordance with the case-law of the Court, exceptions are to be interpreted strictly. ( )

i) Contracts relating to immovable property

74. It must first be established whether the contract at issue is covered by the exception provided for in Article 3(2)(a) of Directive 85/577, which provides inter alia that the directive does not apply to contracts concerning other rights relating to immovable property. ( )

75. On entering a closed-end real property fund, a person must make a contribution to that fund. ( ) The subject-matter of the partnership agreement is therefore not directly the acquisition of any real or personal rights in immovable property, but the acquisition of a holding in the partnership or in the fund. It is therefore common ground that, by entering a closed-end real property fund, the consumer does not directly acquire any rights in immovable property.

76. It is, however, necessary to consider whether, by acquiring a holding in the partnership, the consumer indirectly acquires rights in the immovable property owned by the partnership, and whether such indirect acquisition of rights is sufficient to render applicable the exception provided for in Article 3(2)(a) of Directive 85/577.

77. German legal literature states that, by joining a civil-law partnership, a consumer acquires joint ownership (Gesamthandseigentum) of that partnership’s assets. ( ) Unlike co-ownership, this form of ownership is characterised by the fact that the partner does not hold a defined share of the assets and that the assets are managed jointly. ( ) Since the German courts recognised that a civil-law partnership has legal capacity, the question whether the partnership’s assets remain in joint ownership (Gesamthandseigentum) or whether the partnership alone is the owner of those assets is a matter of dispute in German legal writings. ( )

78. The answer to the question whether, even after civil-law partnerships have been recognised as having legal capacity, the partnership’s assets are owned by all the partners (exercising joint ownership (Gesamthandseigentum)) or by the partnership alone is, in my view, essential to be able to answer the question whether the exception provided for in Article 3(2)(a) of Directive 85/577 applies to the entry by a consumer into a closed-end real property fund. ( ) The answer to the question whether Community law applies will therefore depend, in this case, on the resolution of legal issues at national level over which the national court alone has jurisdiction. However, the Court may provide the national court in the preliminary ruling proceedings with all the guidance that it deems necessary to reply to the question referred for a preliminary ruling. ( )

79. In this connection, it is my opinion that the national court will have to take account of the following factors.

80. First, if it finds that, despite the partnership’s legal capacity, the partners exercise joint ownership (Gesamthandseigentum) of the partnership’s immovable property, this argues in favour of the possibility of applying the exception provided for in Article 3(2)(a) of Directive 85/577 in this case, irrespective of the fact that the consumer acquires rights in the immovable property only indirectly by acquiring a holding in the partnership. Gesamthandseigentum does have certain specific characteristics but it remains a form of ownership. I therefore see no reason why a different conclusion should be reached in this case simply because it concerns a particular form of ownership with specific characteristics. In this connection, the argument that the aim pursued by the consumer in acquiring a holding in the fund is to invest capital is not, in my view, convincing. It is common ground that the consumer’s aim is to make a capital investment and/or to obtain tax relief, but this in no way changes his status as a joint owner of that immovable property.

81. Secondly, in its analysis, the national court will have to consider whether the consumer acquires any real or personal rights in the immovable property. In my view, the expression ‘other rights relating to immovable property’ contained in Article 3(2)(a) of Directive 85/577 must be interpreted as meaning that it is not limited exclusively to real rights, for two reasons. First, there is nothing in its wording to indicate that only real rights are excluded under this exception; on the contrary, rental is not a real right either and yet it is still excluded from the directive’s scope. ( ) Secondly, if this exception were to be limited exclusively to real rights, personal rights relating to immovable property such as, for example, leasing rights or rights of pre-emption, would unjustifiably remain within its scope. It is true that, in the explanatory memorandum to the proposal for that article of the directive, the Commission, as well as referring to the sale of a piece of land or the transfer of ownership of a flat, which are already covered by the concept of contracts for the sale of immovable property in the version of the directive in force, mentioned only real rights, namely mortgages and easements, ( ) but these are merely examples. It is also true that, in practice, ‘other rights relating to immovable property’ are indeed usually real rights. However, I see no reason why that exception should be limited, by its interpretation, to real rights alone. The national court will therefore have to establish in this case whether, by entering a closed-end real property fund established in the form of a civil-law partnership, the consumer acquires any personal or real rights in the immovable property. ( )

ii) Contracts for securities

82. Although none of the parties has raised the issue, it is also necessary to consider whether the entry by a consumer into a closed-end real property fund may be exempted on the basis of an analogous application of the exception provided for in Article 3(2)(e), which excludes from the scope of the directive ‘contracts for securities’.

83. It is my view that this exception cannot be applied in this case.

84. It is true that Directive 85/577 does not contain any definition of the term ‘securities’. However, indications as to the definition of that term can be found in other Community provisions such as Council Directive 93/22/EEC on investment services in the securities field, ( ) which classifies transferable securities in three groups, namely: (1) shares in companies and other securities equivalent to shares in companies; (2) bonds and other forms of securitised debt which are negotiable on the capital market; and (3) any other securities normally dealt in giving the right to acquire any such transferable securities by subscription or exchange or giving rise to a cash settlement excluding instruments of payment. ( ) It is therefore clear that only securities which are dealt in on the market can be classified as securities. ( ) Since holdings acquired in a closed-end real property fund are not dealt in on the market, they cannot be treated as securities.

3. Scope of the German HWiG

85. Finally, it is necessary to consider the argument advanced by Mr von der Heyden’s representative to the effect that the scope of the German HWiG is wider than that of Directive 85/577 and that, consequently, Germany has adopted more favourable provisions to protect consumers within the meaning of Article 8 of Directive 85/577.

86. In this regard, it should be pointed out that the German HWiG applies to the conclusion of all contracts relating to performance for valuable consideration. The scope of that law is therefore wider than that of Directive 85/577 in two respects. First, it does not require that the contract must relate to the supply of goods or services, and, secondly, it does not require that one of the contracting parties must be a trader. On these two points, the scope of that law is therefore more extensive than that of Directive 85/577, and it can therefore be understood why the German courts apply the HWiG to the entry by a consumer into a closed-end real property fund established in the form of a civil-law partnership. ( )

87. Contrary to the view taken by Mr von der Heyden’s representative, I do not think that this constitutes recourse to the possibility offered to Member States in Article 8 of Directive 85/577. That article allows Member States to adopt or maintain more favourable provisions to protect consumers in the field which [Directive 85/577] covers. ( ) Where national legislation applies outside the scope of Directive 85/577, I take the view that Article 8 of Directive 85/577 cannot be relied on.

88. I would, however, also draw attention to the recent judgment in Moteurs Leroy Somer ( ) in which, in relation to Council Directive 85/374/EEC of 25 July 1985 on the approximation of the laws, regulations and administrative provisions of the Member States concerning liability for defective products, ( ) the Court held that that directive does not preclude domestic legislation from applying to a wider field than that of the directive. Directive 85/374 governs cases in which compensation is sought for damage to an item of property intended for private use. However, in accordance with the Court’s decision in Moteurs Leroy Somer, that directive does not preclude national legislation under which the person sustaining the damage may seek compensation for damage to an item of property intended for professional use. I take the view that a conclusion similar to that reached in Moteurs Leroy Somer may likewise be arrived at in this case. This means that the German legislature may provide that the HWiG, which transposes Directive 85/577 into national law, also applies to facts not governed by that directive, and therefore that it also applies to the entry by a consumer into a closed-end real property fund established in the form of a civil-law partnership.

4. Proposed answer to the first question

89. I propose that the Court’s answer to the first question referred should be that Article 1(1) of Directive 85/577 must be interpreted as meaning that it does not apply to the entry by a consumer into a closed-end real property fund established in the form of a civil-law partnership.

D – Second question referred

90. The second question referred must be reworded in part on account of its partial inadmissibility ( ) and because the answer to that question cannot be based on Article 7 ( ) of Directive 85/577, on which the referring court relied in the question. ( )

91. The second question should therefore be understood as meaning that, by it, the referring court asks whether Article 5(2) of Directive 85/577 must be interpreted as meaning that it precludes a national judge-made rule to the effect that, by withdrawing from a closed-end real property fund established in the form of a civil-law partnership, the consumer holds against that fund a claim, calculated at the time of his withdrawal (ex nunc), to his severance balance, the result of which may be that the amount returned to him at the time of his withdrawal is less than that invested in the fund or that he is required to bear part of the losses carried by the fund. It must therefore be determined whether Directive 85/577 precludes the application of the principles established by German case-law in relation to ‘defective partnerships’ (fehlerhafte Gesellschaft) to withdrawal from a closed-end real property fund established in the form of a civil-law partnership. ( )

92. In the light of the proposed answer to the first question referred to the effect that Directive 85/577 does not apply in this case, there is no need, in principle, to answer the second question. ( ) However, it is appropriate to provide in relation to the second question a brief analysis on which the Court may rely if, having regard to the first question, it gives a ruling other than that proposed in this Opinion.

1. Notice of right of renunciation?

93. It should be pointed out first of all that it is not known in this case whether the consumer was given notice of his right of renunciation. The consumer’s right of renunciation is subject to a time-limit ( ) and, under Directive 85/577, and more specifically the provisions transposing it into national law, once that period has expired, the consumer may renounce the effects of his undertaking only if he has not been given notice of that right. ( ) As previously stated in point 20 of this Opinion, this question has been put to the referring court, but that court has not been able to answer it because it is bound by the findings of fact made by the lower court. In addition, the referring court has stated that it is common ground between the parties that the consumer had lawfully cancelled the contract in accordance with the HWiG which transposes Directive 85/577 into national law. That question was also put to the parties at the hearing, but their answers were inconsistent; Mr von der Heyden’s representative explained that he had no information on the matter, but the Commission took the view that this could simply be inferred implicitly from the fact that the consumer had, in this case, been able to renounce the effects of his undertaking.

94. It must be observed that, in proceedings under Article 234 EC, which is based on a clear separation of functions between the national courts and the Court of Justice, any assessment of the facts in the case is a matter for the national court. However, in order to give the national court a useful answer, the Court may, in a spirit of cooperation with national courts, provide it with all the guidance that it deems necessary. ( ) Consequently, in this case, the Court will have to proceed on the assumption that the consumer was not given notice of his right of renunciation, but it will be for the national court to establish the accuracy of that assumption within the scope of its jurisdiction.

2. Analysis of the substance

95. If, in this case, the Court’s answer to the first question referred were that Directive 85/577 applies in this case, the consumer would have to be ‘[released] from any obligations under the cancelled contract’, in accordance with Article 5(2) of that directive. This would mean that the full amount of the sum which he invested in the fund would have to be refunded to him. In this case, in which the fund is loss-making, the result of this would be that the other partners in the fund would have to bear the financial burden of reimbursing that amount to the consumer who has withdrawn from the fund.

96. An explanation should first be given of the significance to this case of Article 7 of Directive 85/577, which provides that ‘[i]f the consumer exercises his right of renunciation, the legal effects of such renunciation shall be governed by national laws, particularly regarding the reimbursement of payments for goods or services provided and the return of goods received’. That article does not confer on the Member States a general power to alter at will the legal consequence provided for in Article 5(2) of that directive, but authorises them only to determine the timing and manner of restitution of the obligations performed under the contract which the consumer has cancelled. ( ) Consequently, that article is not sufficient on its own to support the proposition that the consumer’s withdrawal from the fund gives rise to effects ex tunc.

97. The interpretation of Article 5(2) of Directive 85/577 will therefore be decisive in this case. The wording of that article leaves no room for any doubt: the consumer must be released from any obligations under the cancelled contract. The case-law on the interpretation of that article is likewise clear: in Schulte, the Court held that the cancellation of the contract which the consumer had concluded away from business premises was to result in the restoration of the status quo ante. ( )

98. However, the solution to the effect that withdrawal from the fund by the consumer could give rise to effects ex tunc would be contrary to the purpose of that directive. Consequently, the answer to the second question will have to be based on a teleological interpretation of Article 5(2) of Directive 85/577, and the question answered to the effect that that article does not preclude a national judge-made rule which provides that, by withdrawing from a closed-end real property fund established in the form of a civil-law partnership, the consumer may assert against that fund a claim, calculated at the time of his withdrawal (ex nunc), to his severance balance, the result of which may be that the amount reimbursed to him at the time of his withdrawal is less than that which he invested in the fund, or that he is required to bear part of the losses carried by that fund. Several arguments can be put forward in support of this solution.

99. The first and decisive argument in support of that assertion is that all the other partners in the closed-end real property fund established in the form of a civil-law partnership are, in principle, consumers. ( ) Directive 85/577 grants consumers protection against vendors, but not against other consumers. If it were accepted in this case that a consumer may withdraw from a closed-end real property fund with effect ex tunc, that consumer would indeed be protected but the other consumers still in the fund would at the same time be totally deprived of protection. The only person who would be protected in those circumstances would be the first consumer to decide to withdraw from the fund, while the other consumers not only would not enjoy such protection, their position would be made worse by the protection granted to the consumer who had withdrawn. ( ) It is not therefore possible, in my opinion, to accept the proposition that a consumer withdraws from a closed-end real property fund with effect ex tunc.

100. Secondly, account should be taken of the fact that Directive 85/577 seeks to protect consumers from the hasty conclusion of a contract away from business premises, not from the risks inherent in capital investments. Like other forms of capital investment, investments in closed-end real property funds involve risks; the risk may bring the investor a profit or a loss. If the consumer withdraws from the fund at the very time when that fund generates a profit, he is entitled to have his share of the profit distributed to him and, conversely, if the fund makes a loss, the consumer must, when withdrawing from the fund, bear a share of the loss sustained by the fund. The consumer must assume the risk of the capital investment himself, in the same way that he alone benefits from any profits made by the partnership. Allowing a consumer who has not been given notice of his right of renunciation to withdraw from the fund with effects ex tunc would create an absurd situation, inasmuch as he would be guaranteed a more favourable financial position than a consumer who has been given due notice of his right of renunciation and whose right of renunciation is, as a result, subject to a time-limit.

101. Thirdly, the fact that the consumer withdrew from a closed-end real property fund after 11 years is not insignificant to the analysis of this case. As previously stated in point 94 of this Opinion, I am assuming here that this was possible because the consumer had not been given notice of his right of renunciation. However, it must be borne in mind in this regard that the justification for consumer protection is to some extent different in a situation where the consumer is able to renounce the effects of his undertaking within a period of at least seven days immediately after the contract was concluded as compared with a situation where he may renounce those effects even after some time has passed since the contract was concluded because that period is extended on the ground that he was not given notice of his right of renunciation.

102. The purpose of the opportunity given to a consumer to renounce the effects of his undertaking immediately after the contract has been concluded is protection against hasty decision-making. ( ) The consumer must therefore be allowed, within a relatively short space of time after the contract has been concluded, to consider his obligations under that contract and to decide whether or not to cancel it. The subsequent opportunity afforded to the consumer of renouncing the effects of his undertaking because he has not been given notice of his right of renunciation is based on two partly different arguments. On the one hand, its purpose is to ensure that the consumer can exercise his rights effectively; on the other hand, by allowing the consumer to renounce the effects of his undertaking without time restriction when he has not been given notice of his right of renunciation traders would in some way be obliged to give consumers notice of that right in future. ( ) That extension of the renunciation period might to some extent be said to be a form of penalty against a trader who has failed to give the consumer notice of his right of renunciation. The penalty-like nature of the extended period allowed for renouncing the effects of an undertaking would in this case have an unfair adverse effect on the other consumers who are partners in the real property fund in question.

3. Proposed answer to the second question

103. I therefore propose that the Court’s answer to the second question, if it finds in relation to the first question that Directive 85/577 applies to the entry by a consumer into a closed-end real property fund established in the form of a civil-law partnership, should be that Article 5(2) of Directive 85/577 must be interpreted as meaning that it does not preclude a national judge-made rule which provides that, when withdrawing from a closed-end real property fund established in the form of a civil-law partnership, a consumer may assert against that fund a claim, calculated at the time of his withdrawal (ex nunc), to his severance balance, the result of which may be that the amount reimbursed to him at the time of his withdrawal is less than that which he invested in the fund, or that he is required to bear part of the losses carried by that fund.

E – Conclusion

104. It must be acknowledged that the proposed answer to the second question referred, set out in the foregoing point, creates an exception to Article 5(2) of Directive 85/577. In conclusion, I must therefore return to the answer to the first question and point out that the most appropriate view is that Directive 85/577 does not apply to the entry by a consumer into a closed-end real property fund established in the form of a civil-law partnership.

VII – Conclusion

105. In the light of all the foregoing considerations, I propose that the Court’s answer to the two questions referred for a preliminary ruling by the Bundesgerichtshof should be as follows:

Article 1(1) of Council Directive 85/577/EEC of 20 December 1985 to protect the consumer in respect of contracts negotiated away from business premises must be interpreted as meaning that it does not apply to the entry by a consumer into a closed-end real property fund established in the form of a civil-law partnership.