Identifying consumer protection issues

Directive 1999/44 protects consumers
by giving them various rights in relation to faulty
goods, which partly overlap with the common law, but
are in some respects novel.
It is implemented in English law by sections 48A–48F of the Sale of Goods Act 1979, as amended.

Case C-497/13 Faber (4 June 2015) concerned proceedings
in the Netherlands. Ms Faber bought a second-hand car. While she was on the way to a business meeting, it caught fire and was destroyed. Faber said the seller was liable and sought the return of the price in full. The garage said she had complained too late. Under Dutch law there were rather stringent requirements
for prompt complaints about defects, as well as various other problems with her case. But the Dutch court thought it was arguable that, under the directive, she would be better off.

As it happens, the European Court of Justice (CJEU) agreed. However, the key feature of the case was not about the directive’s meaning, but a point of procedure. Faber had never claimed that she was, in relation to the relevant contract, a consumer (a ‘natural person who… is acting for purposes which are not related to his trade, business or profession’). The garage had pointed out
that there was no need to ask whether she was, and she hadn’t disagreed. In the Netherlands, as in England, that would normally be all the court needed to know: a Dutch court, like an English court, does not normally consider issues that the parties do not raise.

Critically important

But the court wondered whether a different approach should be taken to the directive. Was the objective of consumer protection so critically important that the court must raise it of its own motion, as a point of public policy? How much information was needed before raising the point?

The rubrics under which such questions are answered are now well established: national procedural law governs, provided it is even handed and does not make it impossible or excessively difficult to exercise EU rights.

The short answer given by the CJEU was that the question of whether a person is a consumer or not is indeed a matter of such importance that the national court is obliged to raise the
point itself. Why so? The CJEU reasoned that one of the
main reasons for protecting consumers is that they may lack the knowledge to assert their rights robustly. So, a rule that leaves it to the parties to raise arguments is not good enough. As soon as the court has the material to decide whether a person is a consumer (or the means in its hands to obtain
that material), it should do so.

This is not surprising.
The CJEU has previously held,
for instance, that a court must apply Directive 93/13 on unfair terms in consumer contracts
by examining the fairness of
a contractual term of its own motion (see Case C-243/08 Pannon GSM EU:C:2009:350
and Case C-240/98 to C-244/98 Océano Grupo Editorial EU:C:2000:26). But, while building on the reasoning
in Océano Grupo in particular, Faber seems still more favourable to consumers, since
it concerns not merely the issue of whether the court should raise a question of law, but also whether it should (as far as it can) inquire about the underlying facts, where they seem to suggest that consumer protection may be relevant.

General principle

Is there, then, a general principle that the court should (within the reasonable limits of its power
to do so) take positive steps to identify possible consumer protection defences, whether
or not the consumer has raised them? Perhaps the judgment does not go quite so far, as Advocate General Sharpston pointed out. But, given the CJEU’s approach, it is hard to see where the line would be drawn. (And, anticipating a possible future argument, the CJEU makes it clear that the obligation exists even if the putative consumer is in fact legally represented.)

Three cheers, perhaps, for consumers. But spare a thought for the judges who must take an active role when confronted
with a case where consumer protection issues may arise, even if both parties seem to agree they don’t. Advocates will also need to give careful thought to how the court’s duty, and their duty to the court, may affect the way they deal with litigants in person. SJ

Paul Stanley QC is a barrister practising from Essex Court Chambers