Today, our relationships are not limited to the 316 square kilometres that make up our archipelago. In the past 30 years, we have started interacting more and more with people and companies beyond our shores; indeed, cross-border relationships today are common and vast, ranging from complex company to company trade imports, to a simple purchase of a mobile phone from a foreign seller on eBay.
Every day, we are interacting with people outside our country.
As one would expect, relationships sometimes go sore and give rise to disputes.
Cross-border litigation is often perceived to be cumbersome and costly. The mere fact of having adverse parties residing in different territories could create complex scenarios when it comes to litigious procedures.
Traditionally, it was not deemed worthwhile to sue a foreigner, especially if the claim was low in terms of money. A creditor in Malta who was owed €2,000 had little incentive to file a court case against a debtor living far off, say in north Portugal; it was simply not worth it.
A little-known fact is that on the contrary, suing someone within the EU is far from complicated, and this thanks to Regulation (EC) No. 861/2007 (as amended by Regulation (EC) 2015/2421), the European Union rules establishing the European Small Claims Procedure.
This Regulation (like many others) has been driven by the European objection to attain judicial cooperation and harmonisation between member states. Traditionally, the procedural law of the country where the action is brought, was the law to be applied, even if proceedings were engaged by a non-resident of such country. The courts had always adhered to this principle of the lex fori and regulated their own procedure in accordance to their laws. Traditionally, this served to discourage a creditor from pursuing court again against someone living in another country, for he could very well be tangled up in unfamiliar rules, formalities and procedures of that other country.
This European Union objective, however, has found a way of providing for an alternative mode of procedure that has its own set of rules, which would be automatically applicable, regardless of the procedural rules of the country where the creditor or debtor come from.
The purpose is to provide a speedy and efficient delivery of justice
Indeed, this regulation purports to advance the EU Treaty’s objective to support the elimination of obstacles to the good functioning of civil proceedings, even – if necessary – by advancing more compatibility of the diverse procedural rules that exist among different member states. The spirit of this regulation entails the simplification of civil and commercial cross-border litigations, which concern small costs and claims. This is done by offering an alternative simplified procedure to the already existent national ones.
This procedure applies to cross-border cases in which one of the parties is either domiciled or habitually resident in a member state of the European Union, other than the member state of the court or tribunal which has been seized to determine the case. Simply put, it applies to cross-border litigation with the EU, and cannot be used, for example, by a Maltese person against another person living in Malta. Furthermore, it is strictly an EU-based procedure, and cannot be utilised when the other person habitually resides in a non-EU country.
This is a small claims procedure, so it is only applicable with respect to civil and commercial matters where the value of the claim does not exceed the sum of €5,000, save any interest, disbursements or expenses.
In commencing these European proceedings, the claimant needs to fill in a standard claim (called, ‘Form A’) that is set out in the said regulation. This form is to be lodged within the relevant court or tribunal that enjoys jurisdiction (that is, which country has the power to hear the case) to determine the matter in question. Form A will then be sent to the court seized, via any means of communication that have been made available to the European Commission by the member state in question. The contents of the claim, other than the relevant details of the parties, include an account of the facts, description of evidence that supports the claim in question, as well as any relevant supporting documents.
The general rule is that the European Small Claims Procedure is to be conducted via written means. Oral hearing is an exception to the rule, and the court or tribunal shall only hold oral sittings if it considers that it is not possible to deliver the judgment, solely on the basis of the written evidence.
Moreover, oral sittings do not necessarily require the physical presence of the parties – the regulation allows such to be undertaken via videoconferencing, or through other means of communication. In some exceptional cases, parties are allowed the faculty to request sittings orally, but only if the court elects that the written submissions are not sufficient for the fairness of proceedings. Furthermore, the regulation obliges the court or tribunal to use the simplest and least burdensome method of taking evidence, and expert evidence or oral evidence are only to be used as last resort measures. The purpose is to provide a speedy and efficient delivery of justice.
Fees are capped to the same amounts that are charged to parties who undertake national small claims procedures. Also, legal representation is not mandatory when such procedure is engaged.
The procedure is simple and effective, as evident from the judgment delivered last Monday in the names of David Moore v Goldcar Rental Malta, which was an excellent example of the European small claims procedure being utilised to its maximum utility.
The facts of such case concerned a typical scenario of a claim which amounted to €1,440. The parties resided in different territories – the claimant being a foreigner and the defendant a local car operator.
During this case the Tribunal determined that no oral hearing was required, since the written evidence furnished by both parties enabled it to determine the case on the basis of written means. After having seen all evidence, the Tribunal partially upheld the claimant’s request, and ordered the respondent to pay claimant the sum of €997.69, with legal interest.
Mary Rose Micallef is junior associate with Azzopardi, Borg and Abela Advocates.