JUDGMENT OF 12. 7. 1984 — CASE 178/83 FIRMA P. v FIRMA K.
In Case 178/83 REFERENCE to the Court, under Article 1 of the Protocol of 3 June 1971 on the interpretation by the Court of Justice of the Convention of 27 September 1968 on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters, from the Oberlandesgericht [Higher Regional Court] Frankfurt am Main for a preliminary ruling in the proceedings pending before that court between
THE COURT (Second Chamber) composed of: K. Bahlmann, President of chamber, P. Pescatore and O. Due, Judges, Advocate General: M. Darmon Registrar: H. A. Rühi, Principal Administrator
gives the following
JUDGMENT
Facts and Issues
I — Facts and procedure
II — Summary of the written observations submitted to the Court
III — Written replies of Firma P. to the questions put by the Court
1. First question
2. Second question
3. Third question
IV — Oral procedure
Decision
Costs
I —. Facts and procedure
1. Did the Landgericht specify (under Article 48 of the Convention) a time for the production by the applicant of the documents referred to in Articles 46 (2) and 47 (1) of the Convention?
2. Has the applicant at this stage of the proceedings produced equivalent documents?
3. What are the additional documents which were produced by the applicant in support of its appeal and which, in its view, show that the writ and judgment in default were served in the proper manner?
II —. Summary of the written observations submitted to the Court
III —. Written replies of Firma P. to the questions put by the Court
1. First question
2. Second question
(a). letter of 21 April 1982 from the Ministry of Foreign Affairs at The Hague,
(b). letter of 08.07. 1402 H from the Central Post Office of the Kingdom of Saudi Arabia,
(c). letter of 6 July 1982 from the Public Prosecutor's Office, Rotterdam,
(d). letter of 18 May 1982 from the Public Prosecutor's Office, Rotterdam.
3. Third question
(a). the statement of claim together with a German translation,
(b). a certified copy of the judgment given by the Arrondissementsrechtbank, Rotterdam, on 20 January 1982, together with translations in German and Arabic,
(c). the letters of 18 May 1982 and 6 June 1982 from the Public Prosecutor's Office at Rotterdam, which had already been produced to the Landgericht, and the certificate of registration from the Post Office of Saudi Arabia, together with German translations of all three,
(d). the letter of 6 October 1981 from the Ministry of Foreign Affairs at The Hague, with a German translation,
(e). the letter of 17 September 1981 from the Netherlands Embassy in Jeddah, together with a translation.
IV —. Oral procedure
1. By an order of 12 August 1983, which was received at the Court Registry on 18 August 1983, the Oberlandesgericht [Higher Regional Court] Frankfurt am Main referred to the Court of Justice for a preliminary ruling under Articles 2 (2) and 3 (2) of the Protocol of 3 June 1971 on the interpretation by the Court of Justice of the Convention of 27 September 1968 on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters (hereinafter referred to as the Convention) a question on the interpretation of the first sentence of the second paragraph of Article 40 of the Convention.
2. That question was raised in the course of litigation between Firma P. (hereinafter referred to as the plaintiff) and Firma K. (hereinafter referred to as the defendant); it concerns the necessity or otherwise of summoning the defendant to appear before the Oberlandesgericht in proceedings for the enforcement of a default judgment given on 20 January 1982 by the Arrondissementsrechtbank, Rotterdam.
3. By that judgment the defendant was ordered to pay to the plaintiff the sum of 678095 Saudi riyals or the equivalent of that sum in US dollars, together with interest as required by law. On the ground that the defendant had a bank account in Frankfurt am Main, the plaintiff applied to the Landgericht [Regional Court] Frankfurt am Main for an order for the enforcement of the judgment.
4. By an order made on 10 January 1983 without the defendant's having been summoned to appear, the President of the Third Civil Division of that court dismissed the application on the ground that the plaintiff had tailed to produce the documents required by Article 46 (2), namely:
5. The plaintiff appealed against that order to the Oberlandesgericht; in support of its appeal it produced supplementary documents which, in its view, showed that the statement of claim and the default judgment had been properly served.
6. Considering that the result of the proceedings before it depended on.the interpretation of Article 40 of the Convention, the Oberlandesgericht stayed the proceedings and referred the following question to the Court of Justice:
7. Article 40 of the Convention provides that:
8. It should be noted that the wording of that article does not provide for any exception.
9. The Oberlandesgericht none the less asks whether such an exception should be acknowledged to exist by reason of the fact that, on the one hand, the Landgericht dismissed the application for an enforcement order for the sole reason that the documents were not produced by the plaintiff at the proper time and, on the other hand, the system postulated by Article 40 is unsuited to this case since enforcement is to take place in a State which is not the State of domicile of the party against whom it is sought.
10. In the context of this case, the position taken by the Oberlandesgericht may be explained by the fact that, in order to fully safeguard the surprise effect of the enforcement proceedings at that level, the Landgericht could have gone further in its examination of the case and sought to obtain the information which was lacking in order to arrive at a decision on the substance of the case.
11. It is nonetheless true that the Convention formally requires that both parties should be given a hearing at the appellate level, without regard to the scope of the decision in the lower court. That provision is in accordance with the spirit of the Convention, which seeks to reconcile the necessary surprise effect in proceedings of this nature with respect for the defendant's right to a fair hearing (see the judgment of the Court of 21. 5. 1980, Case 125/79, Denilaulerv Couchet Frères, [1980] ECR 1553). That is why the defendant is not entitled to be heard in the lower court, whereas on appeal he must be given a hearing. There can be no exception to that rule in a situation where, for reasons which may be ascribed to the plaintiff, the lower court has dismissed an application for enforcement on purely formal grounds. There is no ground for approaching this matter differently according to whether the defendant's habitual residence or registered office is in the State where enforcement is sought or in another State.
12. As a result, the reply to the question referred by the national court should be that the court hearing an appeal by a party seeking enforcement is required to hear the party against whom enforcement is sought, pursuant to the first sentence of the second paragraph of Article 40 of the Convention, even though the application for an enforcement order was dismissed simply because documents were not produced at the appropriate time and the enforcement order is applied for in a State which is not the State of residence of the party against whom enforcement is sought.
13. The costs incurred by the Government of the Federal Republic of Germany and by the Commission of the European Communities which have submitted observations to the Court, are not recoverable. As these proceedings are, in so far as the parties to the main proceedings are concerned, in the nature of a step in the action pending before the national court, the decision on costs is a matter for that court.
On those grounds, THE COURT (Second Chamber), in answer to the question referred to it by the Oberlandesgericht Frankfurt am Main by order of 12 August 1983, hereby rules: