Judgment of the Court of 24 November 2014 in Case E-27/13 — Sævar Jón Gunnarsson v Landsbankinn hf. (Indexation of loans — Directive 87/102/EEC — Consumer credit agreements — Directive 93/13/EEC — Unfair terms — Mandatory terms)
Date: 2014-11-24
Institutions: EFTA Court
Subjects: Iceland, consumer credit, consumer information, interpretation of the law, price index, redemption, unfair terms of contract








C_2015183EN.01000701.xml










4.6.2015   


EN


Official Journal of the European Union


C 183/7





JUDGMENT OF THE COURT
of 24 November 2014
in Case E-27/13
Sævar Jón Gunnarsson v Landsbankinn hf.
(Indexation of loans — Directive 87/102/EEC — Consumer credit agreements — Directive 93/13/EEC — Unfair terms — Mandatory terms)
(2015/C 183/08)
In Case E-27/13, Sævar Jón Gunnarsson v Landsbankinn hf. – REQUEST to the Court under Article 34 of the Agreement between the EFTA States on the Establishment of a Surveillance Authority and a Court of Justice from Reykjavík District Court (Héraðsdómur Reykjavíkur) concerning the interpretation of Council Directive 87/102/EEC of 22 December 1986 on consumer credit and Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts, the Court, composed of Carl Baudenbacher, President and Judge-Rapporteur, Per Christiansen and Páll Hreinsson, Judges, gave judgment on 24 November 2014, the operative part of which is as follows:






1.


When a credit agreement is linked to a consumer price index, it is not compatible with Directive 87/102/EEC to calculate the total cost of the credit and the annual percentage rate of charge on the basis of 0 % inflation if the known rate of inflation at the time of the credit agreement is not 0 %. It is for the national court to assess, taking account of all the circumstances of the case, the legal consequences of and the remedies for such incorrect information, provided that the level of protection established by Directive 87/102/EEC, as interpreted by the Court, is not compromised.
For the situation that the referring court does not consider the contractual terms on the indexation of repayment instalments of the consumer loan in question to be mandatory regulatory or statutory provisions within the meaning of Article 1(2) of Directive 93/13/EEC, the answers to the subsequent questions are as follows:










2.


Directive 93/13/EEC does not generally prohibit contractual terms on the indexation of loans in contracts between a supplier and a consumer. It is for the referring court to assess whether the term at issue is unfair. The assessment must take account of the Court’s interpretation of the concept of ‘unfair term’.










3.


Directive 93/13/EEC does not limit the discretion of an EEA State to determine, whether through legislation or by means of administrative regulation, the factors that may cause changes in a pre-determined index, such as the Icelandic consumer price index, as well as the methods for measuring those changes, provided that they are explicitly described in the contract.










4.


It is for the competent national court to establish whether a particular contract term has been negotiated individually within the meaning of Article 3 of Directive 93/13/EEC.










5.


It is for the competent national court to establish whether a contract term relating to the indexation of repayment instalments of a loan must be regarded as having been explicitly and comprehensibly described to the consumer. Such an assessment must take into account the precise wording of the relevant contract terms and all other relevant circumstances, including the circumstances set out in points (a) and (b) of the fourth question posed by the national court, as well as the national legislation on price indexation.










6.


Article 6(1) of Directive 93/13/EEC is to be interpreted as meaning that, where a national court considers that a given term is unfair within the meaning of Directive 93/13/EEC, that court must ensure that such a clause is not binding on the consumer provided that the contract is capable of continuing in existence without the unfair term, in so far as, in accordance with the rules of domestic law, such continuity of the contract is legally possible.