European Order for Payment Procedure

                                          April 22nd, 2008

                                         Mgr. Petra Novotna

                                    Order for payment - concept

•            Procedure unknown to the common law countries, exists in most European countries
national law

•            Various names: Mahnverfahren, injoction de payer, injunction to pay

•            Creditor needs a court decision to recover a debt via enforcement proceedings because
the defendant is unable or unwilling to pay (e.g. no dispute about the sum)

                                         Basic explanation

•            court in a written proceeding issues an ex parte order based on the allegations of (or
evidence) the plaintiff

•            Defendant-debtor has to start the proceeding with a hearing and taking of evidence,
debtor has to object on time (that complies with art. 6 ECHR fair trial requirement)

•            Without objection the order becomes final and enforceable

                                              Reasons

•            Regular oral proceedings is most valuable for the taking of evidence, participation of
parties, exercise of their rights, public observes = control function

•            BUT

•            For finding out whether defendant contests a claim, a written procedure is more
appropriate – saves time, effort and costs, relieves the court, standardised decision form (use of
computers)

                                          Two basic models

•            "evidence" model - claimant is required to produce written evidence to substantiate the
claim, which is examined by a judge;

•             "no evidence" model - courts do not assess the claim's validity. Whenever a claim is
admissible and satisfies the basic formal requirements, the court issues an order for payment
without it being necessary to submit supporting documents.

                              European Order for Payment - Background

•           ECT art. 61(c), 65(c) – judicial cooperation, good functioning of civil proceedings –
compatibility of the rules on civil procedure

•           Tampere 1999 issues

•           2002 Green paper adopted

•           2004 Hague Programme

•           EP EC Regulation 1896/2006 (effective december 2008)

                                            EPO reasons

•            Recitals 6  - 9.

•            Swift and efficitent recovery where no legal controversy exists, late payments are main
reson for insolvency

•            Varying legislation distorts competition = need for a minimum standard, level for EU
creditors and debtors enabling free and quick circulation of PO = simplified system for collecting
uncontested debts between member States

                                             EPO nature

•           Recitals 10, 17, 27, art. 1

•           Facultative procedure = claimant may choose the national law procedure = no replacement
or harmonisation of existing national mechanisms

•           No right to appeal against rejection of the applicaiton for PO

•           Enforceable throughout EU, mutual trust







                        Application scope and relation to other instruments

•             Art. 2

•             Cross-border case (art.3)

•             Civil and commercial matters (contractual and non-contractual debts/claims)

•             NO revenue, customs, administrative matters, acta iure imperii + par. 2 exceptions

•             Not in Denmark

•             Time – art. 33

•             Uncontested pecuniary claims (art. 1, 4)

•             Procedural rules out of EPO scope – national law art. 26

•             Service of documents regulation art. 27

•             Jurisdiction under Brussels I

                                            EPO outline

•            Standard form A request (annex 1)

•            Issued by court having jurisdiction under Brussels I (art. 6, consumer exception)

•            Creditor requests, debtor is served

•            Debtor may oppose the claim

•            YES: the proceedings will continue before the court that issued the order as normal
civil or commercial litigation

•            NO: order becomes enforceable and no further exequatur is necessary

                                                EPO

•            Application requirements art. 7 (paper, electronic - signature)

•            Examination by court art. 8:

•            B form for completion or rectification w/i time limit (art. 9)

•            C form for modification (claim partially accepted art. 10, remaining part by national
law)

•            Rejection grounds: art. 11 (D form)

•            No appeal but may file new application under EC law or national law



                                        Issue of EPO art. 12

•            form E, w/i 30 days (not counting completion etc.)

•           Two options for defendant:

•           A) pay the amount indicated

•           B) oppose the order (30 days) art. 16

•           Notice of consequences for debtor

                                           Service of EPO



•            Lex specialis to the service regulation No 1393/2007 (effective November 2008) –art. 27

•            Arts. 13 – 15

•            MAY be served

•            With and without proof of receipt

•            Methods in accordance with national law = regulation sets minimum procedural standards

•            May be served on defendant´s representative

                                     Opposition to EPO art. 16

•           Form F (paper, electronic + signature)

•           w/i 30 days of service

•           No statement of reasons necessary

•           Effects: art. 17 – proceedings continue

•           Enforceability in case of no opposition: art. 18 (form G) – recognised and enforced art.
19, 21 X art. 22, 23

•           Conditions for review – art. 20



                                   Refusal of enforcement art. 22

•           Earlier decision  by any MS or 3rd country in the same cause, b/w same parties

•           Conditions met for recognition and enforcement

•           Irreconcilability not objected

•           BUT – no review of substance!

•           Art. 23 stay or limitation of enforcement during review procedure