LH v PROFI CREDIT Slovakia s.r.o.

• Jurisdiction: European Union
• Date: 22 April 2021
• Court: Court of Justice (European Union)

Provisional text

JUDGMENT OF THE COURT (First Chamber)

22 April 2021 (*)

(Reference for a preliminary ruling – Consumer protection – Directive 2008/48/EC – Credit agreements for consumers – Directive 93/13/EEC – Unfair contract terms – Payment made under an unlawful term – Unjust enrichment of the lender – Right to restitution time-barred – Principles of Union law – Principle of effectiveness – Article 10(2) of Directive 2008/48 – Information to be included in a credit agreement – Elimination of certain national requirements on the basis of the case-law of the Court – Interpretation of the old version of the national legislation in accordance with that case-law – Temporal effects)

In Case C‑485/19,

REQUEST for a preliminary ruling under Article 267 TFEU from the Krajský súd v Prešove (Regional Court, Prešov, Slovakia), made by decision of 12 June 2019, received at the Court on 25 June 2019, in the proceedings

LH

v

Profi Credit Slovakia s. r. o.,

THE COURT (First Chamber),

composed of J.‑C. Bonichot, President of the Chamber, L. Bay Larsen, C. Toader, M. Safjan and N. Jääskinen (Rapporteur), Judges,

Advocate General: M. Szpunar,

Registrar: A. Calot Escobar,

having regard to the written procedure,

after considering the observations submitted on behalf of:

– Profi Credit Slovakia s. r. o., by A. Cviková, advokátka,

– the Slovak Government, by B. Ricziová, acting as Agent,

– the European Commission, by G. Goddin and by N. Ruiz García and A. Tokár, acting as Agents,

after hearing the Opinion of the Advocate General at the sitting on 3 September 2020,

gives the following

Judgment

1 This request for a preliminary ruling concerns the interpretation of Article 47 of the Charter of Fundamental Rights of the European Union (‘the Charter’), the principle of effectiveness of European Union law and provisions of Directive 2008/48/EC of the European Parliament and of the Council of 23 April 2008 on credit agreements for consumers and repealing Council Directive 87/102/EEC (OJ 2008 L 133, p. 66; corrigenda OJ 2009 L 207, p. 14; OJ 2010 L 199, p. 40; and OJ 2011 L 234, p. 46), in particular, Article 10(2)(h) and (i) thereof.

2 The application has been made in proceedings between LH and Profi Credit Slovakia s. r. o. concerning unjust enrichment of that company, allegedly as a result of a payment made by the borrower on the basis of allegedly unfair or unlawful terms in a consumer credit agreement.

Legal context

European Union law

Directive 93/13/EEC

3 Article 6(1) of Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts (OJ 1993 L 95, p. 29) provides:

‘Member States shall lay down that unfair terms used in a contract concluded with a consumer by a seller or supplier shall, as provided for under their national law, not be binding on the consumer and that the contract shall continue to bind the parties upon those terms if it is capable of continuing in existence without the unfair terms.’

4 Article 7(1) of that directive states:

‘Member States shall ensure that, in the interests of consumers and of competitors, adequate and effective means exist to prevent the continued use of unfair terms in contracts concluded with consumers by sellers or suppliers.’

Directive 2008/48

5 According to Article 1 thereof, the purpose of Directive 2008/48 is to harmonise certain aspects of the Member States’ rules concerning agreements covering credit for consumers.

6 Article 3(i) defines the concept of ‘annual percentage rate of charge’ (‘APR’) as being ‘the total cost of the credit to the consumer, expressed as an annual percentage of the total amount of credit, where applicable including the costs referred to in Article 19(2)’.

7 Article 10 of that directive, entitled ‘Information to be included in credit agreements’, states in paragraph 2:

‘The credit agreement shall specify in a clear and concise manner:

…

(g) the [APR] and the total amount payable by the consumer, calculated at the time the credit agreement is concluded; all the assumptions used in order to calculate that rate shall be mentioned;

(h) the amount, number and frequency of payments to be made by the consumer and, where appropriate, the order in which payments will be allocated to different outstanding balances charged at different borrowing rates for the purposes of reimbursement;

(i) where capital amortisation of a credit agreement with a fixed duration is involved, the right of the consumer to receive, on request and free of charge, at any time throughout the duration of the credit agreement, a statement of account in the form of an amortisation table.

The amortisation table shall indicate the payments owing and the periods and conditions relating to the payment of such amounts; the table shall contain a breakdown of each repayment showing capital amortisation, the interest calculated on the basis of the borrowing rate and, where applicable, any additional costs; where the interest rate is not fixed or the additional costs may be changed under the credit agreement, the amortisation table shall indicate, clearly and concisely, that the data contained in the table will remain valid only until such time as the borrowing rate or the additional costs are changed in accordance with the credit agreement;

…’

8 Article 22 of Directive 2008/48, entitled ‘Harmonisation and imperative nature of this Directive’, provides in paragraph 1:

‘Insofar as this Directive contains harmonised provisions, Member States may not maintain or introduce in their national law provisions diverging from those laid down in this Directive.’

Slovak law

The Civil Code

9 Article 53 of the Občiansky zákonník (Civil Code) provides as follows:

‘1. A contract concluded with a consumer must not contain provisions causing a significant imbalance in the rights and obligations of the parties to the detriment of the consumer (unfair term). …

…

(5) Unfair terms used in a contract concluded with a consumer shall be invalid.’

10 Under Article 107 of the Civil Code:

‘(1) The right to claim restitution on the grounds of unjust enrichment shall be time-barred within two years from the time when the person concerned becomes aware of unjust enrichment and discovers who has enriched himself or herself to his or her detriment.

(2) The right to restitution on the grounds of unjust enrichment shall lapse at the latest within 3 years, and within 10 years in the case of intentional unjust enrichment, from the day on which the unjust enrichment occurred.

…’

11 Article 451(2) of the code defines ‘unjust enrichment’ as ‘a pecuniary advantage obtained by means of a benefit without a legal basis, a benefit based on a void legal act or a benefit based on a legal ground that has ceased to exist, as well as a pecuniary advantage derived from dishonest sources’.

Law No 129/2010

12 The zákon č. 129/2010 Z. z. o spotrebiteľských úveroch a o iných úveroch a pôžičkách pre spotrebiteľov a o zmene a doplnení niektorých zákonov (Law No 129/2010 on consumer credit and other forms of credit and loans for consumers, amending certain other laws) is intended to transpose Directive 2008/48 into Slovak law.

13 In the version applicable to the dispute in the main proceedings, Article 9(2)(k) of Law No 129/2010 provided that the consumer credit agreement was to contain the amount, number and timing of the repayments of capital, interest and other charges borne by the borrower and, where appropriate, the order in which the payments were to be allocated to the various balances due which had been fixed at different lending rates for the purposes of repayment.

14 In order to comply with the interpretation of Article 10(2) of Directive 2008/48 adopted in the judgment of 9 November 2016, Home Credit Slovakia (C‑42/15, EU:C:2016:842, paragraphs 51 to 59), the Slovak legislature amended Law No 129/2010 in such a way that, in the version applicable from 1 May 2018, Article 9(2)(i) thereof provides that the consumer credit agreement must state ‘the amount, number and frequency of payments and, where appropriate, the order in which payments are to be allocated to the various balances due set at different lending rates for the purpose of repayment’.

15 Under Article 11(1) of Law No 129/2010, in the version applicable to the dispute in the main proceedings, consumer credit is ‘deemed to be free of interest and charges’ if the agreement relating thereto does not contain the elements required, inter alia, under Article 9(2)(a) to (k) of that law or does not correctly indicate the APR, to the detriment of the consumer.

The dispute in the main proceedings and the questions referred for a preliminary ruling

16 On 30 May 2011, the applicant in the main proceedings and Profi Credit Slovakia entered into a consumer credit agreement for the sum of EUR 1 500, with an interest rate of 70% and an APR of 66.31%, amounting to a total of EUR 3 698.40, to be repaid in 48 monthly instalments of EUR 77.05, without any specification as to the breakdown of the repayments between capital, interest and other costs borne by the borrower.

17 It is apparent from the order for reference that, under the terms of that agreement, Profi Credit Slovakia was entitled, from the first day of the contractual relationship, to charge fees amounting to EUR 367.49 in return for the possibility given to the consumer of obtaining a deferment of the repayment of the credit in the future. As a result of the application of those charges, the applicant in the main proceedings received not the agreed amount of EUR 1 500, but a residual amount of EUR 1 132.51, a reduction of 24%, even though it was not certain that that consumer would make use of the option to defer reimbursement.

18 On the other hand, the referral decision states that the APR mentioned in this contract (66.31%) is lower than the interest rate (70%), which could be related to the fact that the APR was not calculated on the basis of the amount actually paid by Profi Credit...