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A euro area Member State can oblige its administration to accept payments in cash, but can also limit that payment option on public interest grounds

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In its Judgment in Joined Cases C-422/19 and C-423/19 (Johannes Dietrich and Norbert Häring v Hessischer Rundfunk) the European Court of Justice ruled that a euro area Member State can oblige its administration to accept payments in cash, but can also limit that payment option on public interest grounds. Such a limitation may in particular be justified where payment in cash is likely to involve the administration in unreasonable expense because of the very high number of persons liable to pay. Two German citizens who were liable to pay a radio and television licence fee in the Land of Hesse (Germany) offered to pay it to Hessischer Rundfunk (Hesse’s broadcasting body) in cash. Invoking its regulations on the procedure for payment of radio and television licence fees, which preclude any possibility of paying the licence fee in cash, [1] Hessischer Rundfunk refused their offer and sent them payment notices. The two German citizens brought an action against those payment notices and th...
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The Delivery Delay Clause in Residential Construction Contracts: Consumer Protection in Cyprus and Europe

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By Giorgos Kazoleas, LL.M., Lawyer, Managing Partner at Legal Experts Cyprus The purchase or construction of a new residence is one of the most significant financial and personal decisions a consumer can make. Residential construction contracts or agreements for the sale of property under construction are a crucial and defining element of the entire process, as certain terms they may contain can be detrimental to the buyer. One of the most critical aspects is the contractual delivery time of the project and the provision for delay, through the so-called delivery delay clause. The Delivery Delay Clause: Its Role and Legal Nature The delivery delay clause (also known as a penalty clause in the event of default) is a term usually included in the contract that specifies a predetermined compensation amount that the contractor or seller must pay to the buyer for every day, week, or month of delay beyond the agreed delivery date. The purpose of the clause is twofold: -Compensatory: ...
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Unfair and illegal terms of loan agreements used by banks

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Article by George Kazoleas,  Lawyer LL.M. (Banking & Capitalmarkets Law) It is well known that loan agreements contain terms and conditions that disturb the balance between the parties to the detriment of the borrower and are therefore legally and judicially  diagnosed as contrary to law. Despite this, most banks insist on including them in their new contracts, refusing to comply with court rulings even by the European Court of Justice. Especially, foreign currency loan agreements (such as the Swiss franc) contain many unfair and opaque terms. Particularly: The Bank had to inform the potential borrower of the foreign exchange risk and explain in detail the relevant clauses before concluding the loan. It is very common, that the loan agreement does not mention anything about this risk, nor does it appear that the borrower has been effectively and properly informed by a competent bank official. According to Cypriot and European legislation and case law, the loan...
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A holding by purely financial investors in a law firm may be prohibited (CJEU)

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The EU Court of Justice ruled in Case C-295/23 (Halmer Rechtsanwaltsgesellschaft) that a holding by purely financial investors in a law firm may be prohibited. Such a prohibition is justified in order to ensure the independence of lawyers.  A Member State may prohibit holdings by purely financial investors in the capital of a law firm. Such a restriction on the freedom of establishment and the free movement of capital is justified by the objective of ensuring that lawyers can exercise their profession independently and in compliance with their professional conduct obligations.  The German law firm Halmer Rechtsanwaltsgesellschaft is challenging before the Higher Bavarian Lawyers’ Court (Germany) a decision of the Munich Bar Association of 9 November 2021 which revoked its registration with the bar association on account of the fact that an Austrian limited liability company acquired shares [1] in it for purely financial purposes. Under the German legislation applicable at the ...
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Alleged bullying of whistle-blowing prison guard - Violation of right to respect for private life (ECtHR)

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In its Chamber judgment in the case of Špadijer v. Montenegro (application no. 31549/18) the European Court of Human Rights held, unanimously, that there had been a violation of Article 8 (right to respect for private life) of the European Convention on Human Rights. The case concerned the alleged bullying of a prison guard following her reporting an incident involving male prison guards coming into the women’s prison where she worked and their inappropriate contact with female prisoners, and her attempts to address this with the authorities. The Court found in particular that the manner in which the legal mechanisms had been implemented in the applicant’s case had been inadequate, constituting a violation of the obligation on the State to protect her rights. Facts of the case The applicant, Daliborka Špadijer, is a Montenegrin national who was born in 1978 and lives in Podgorica. In 2013 Ms Špadijer, then head-of-shift prison guard in a women’s prison, reported five colleagues for an ...
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Swiss franc loans and borrowers’ rights in the light of 4 important judgments of the European Court of Justice

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By George Kazoleas, Lawyer LL.M. The EU Court of Justice has issued important decisions in recent years on the issue of bank foreign currency loans, essentially in Swiss francs, which has created significant case law useful for defending the interests of borrowers who have been “trapped” by credit institutions in contracts with abusive currency risk clauses resulting in undue overchargings. In summing up this case-law, the European Court of Justice has reached the following main conclusions: 1.The loan agreement must set out in a transparent manner the exact functioning of the foreign currency conversion mechanism and the exchange rate clause so that the consumer can assess the financial consequences of this mechanism. 2.The borrower must be clearly informed by the bank that, by concluding a loan agreement in a foreign currency, he / she is exposed to a certain foreign exchange risk that he / she may find it difficult to cope with in the event of a devaluation of the currency a...
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Obligation of a creditor to check a consumer’s creditworthiness - Credit agreement void and creditor’s entitlement to payment of the agreed interest forfeited

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By Giorgos Kazoleas, Lawyer A significant decision was issued by the CJEU [1] interpreting Articles 8 and 23 of Directive 2008/48/EC on consumer credit agreements and repealing Council Directive 87/102/EEC as regards the obligation of credit institutions to assess the creditworthiness of consumers before concluding the credit agreement.  Article 8 of that directive, entitled ‘Obligation to assess the creditworthiness of the consumer’, provides: ‘ 1. Member States shall ensure that, before the conclusion of the credit agreement, the creditor assesses the consumer’s creditworthiness on the basis of sufficient information, where appropriate obtained from the consumer and, where necessary, on the basis of a consultation of the relevant database. Member States whose legislation requires creditors to assess the creditworthiness of consumers on the basis of a consultation of the relevant database may retain this requirement. 2. Member States shall ensure that, if the...
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