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Enforceability of the first instance judgment when Appeal judgment set aside

27. April 2020

If an appeal judgment is cancelled which has overturned a provisionally enforceable first-instance judgment, the provisional enforceability of the first-instance judgment is revived, the German Federal Court of Justice ruled as a leading principle.

Vollstreckbarkeit - Urteil des BGH

Resumption of provisional enforceability disputed in case law

It is disputed in case-law and literature whether, after a provisionally enforceable first instance judgment has been overturned by the Court of Appeal and the Federal Court of Justice has overturned the appeal judgment and referred the case back to the Court of Appeal, the (provisional) enforceability of the first instance judgment is revived.

The argument against the resurgence of provisional enforceability is that the presumption of correctness of the first judgment justifying provisional enforceability is still shaken by the deviating second judgment, even though it has been revoked. On the other hand, it is argued that with the revocation of the appeal decision, its effects ceased to exist altogether, i.e. also the prerequisites for the facts of the case.

Previously, the Federal Court of Justice had only decided the opposite case, namely that the court of appeal had rejected the appeal against the first instance judgment declared provisionally enforceable and that this judgment had been overturned by the Federal Court of Justice (Federal Court of Justice, judgment of 28 October 1958 – VIII ZR 431/56; Federal Court of Justice, order of 14 October 1981 – V ZR 113/80).

However, these rulings suggest that the revocation of the appeal judgment will give full effect to the first-instance judgment, explained the Federal Court of Justice and now postulated this as a leading principle in its judgement IX ZR 135/19: If an appeal judgment is reversed which has overturned a provisionally enforceable first-instance judgment, the provisional enforceability of the first-instance judgment will be revived.

Background: Documentary proceedings in the appellate instance

In the case on which this judgment was based, it was a question of refraining from the documentary proceedings in the appellate court. An attorney, plaintiff before the Federal Supreme Court, acted for his client, who is the sole shareholder of a Swiss stock corporation, as an organ of this company for the purpose of negotiating an agreement with a contractual partner. Defendants are the heirs of the client and sole shareholder.

A fee agreement was signed between the attorney and the client for an exclusive representation of the Swiss stock corporation, but the payments agreed in the agreement were neither requested from nor made by the stock corporation. The plaintiff asserted his claims in the documentary proceedings.
The point at issue before the Federal Supreme Court was the evidence submitted by the lawyer in the documentary proceedings; the authenticity of the testator’s signature had been effectively contested by his heirs.

Relevance of the distancing from the documentary proceedings

In this case, the Federal Court of Justice ruled that the court of appeal had wrongly regarded the distancing from the documentary proceedings declared by the plaintiff in the appeal proceedings as not relevant and therefore inadmissible. The Court of Appeal did not recognise that at the time of its decision on the relevance of distancing itself from the documentary procedure it was in the documentary proceedings. But only after the admissible abstention the legal dispute will be continued as a whole in the appellate instance in ordinary proceedings, the BGH decided.
Therefore the BGH ordered that the decision of the Court of Appeal be set aside and referred back.

The Federal Court of Justice referred to the case law according to which, in principle, it is not contrary to the relevance that new party statements and, if necessary, the taking of evidence become necessary as a result of the amendment to the complaint and that the completion of the proceedings is delayed.

The BGH added that, as a rule, the relevance could therefore not be denied on the grounds that the defendant would lose a factual level of jurisdiction by allowing a change or extension of the action.

Enforceability of a foreign arbitral award

In this context, we would also like to refer to another key leading ruling of the Federal Court of Justice (I ZB 64/19), which was published a few days ago. This concerns the declaration of enforceability of a foreign arbitral award and the remedying of Irregularities in notification. This is because the basic procedural right of Article 103 (1) of the German Basic Law also has comprehensive effect in proceedings for a declaration of enforceability of a foreign arbitral award.

The actual receipt of the original document to be served is not necessary for the actual receipt as a prerequisite for the remedying of Irregularities in notification under § 189 ZPO (ZPO = German Code of Civil Procedure). The successful transmission of an (electronic) copy in the form – for example – of a fax, a photocopy or a scan is sufficient, the Federal Court of Justice ruled in its leading principle decision. A mere oral transmission or a handwritten or typewritten copy of the original to be served, on the other hand, is not sufficient because of the susceptibility to errors.

Do you need help with a preliminary injunction and its enforceability?

Our attorneys have many years of expertise in all aspects of intellectual property law and are entitled to represent you in any court – in Germany and internationally.
Please contact us if you are interested.

 

 

Sources:

BGH Urteil IX ZR 135/19

BGH I ZB 64/19, Heilung des Zustellungsmangels

Image:

BRuM309 | pixabay.com | CCO License

 

 

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Category iconInternational Intellectual Property,  Patent Law Tag iconBGH,  foreign law,  Enforceability,  documentary procedure,  provisional enforceability,  reinstatement of provisional enforceability,  cancellation of the judgment of the appellate court,  Leitsatz,  I ZB 64/19,  IX ZR 135/19,  Urteil IX ZR 135/19,  Sachdienlichkeit,  Irregularities in notification

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