Case C-237/02

Freiburger Kommunalbauten GmbH Baugesellschaft & Co. KG

v

Ludger Hofstetter and Ulrike Hofstetter

(Reference for a preliminary ruling from the Bundesgerichtshof)

(Directive 93/13/EEC – Unfair terms in consumer contracts – Contract for the building and supply of a parking space – Reversal of the order of performance of contractual obligations provided for under national law – Clause obliging the consumer to pay the price before the seller or supplier has performed his obligations – Obligation on the seller or supplier to provide a guarantee)

Summary of the Judgment

Approximation of laws – Unfair terms in consumer contracts – Directive 93/13 – Unfair term under Article 3 – Meaning – Clause obliging the consumer to pay the full price before performance once a guarantee is provided – Assessment of unfair nature by the national court

(Council Directive 93/13, Art. 3)

It is for the national court to decide whether a contractual term in a building contract requiring the whole of the price to be paid before the performance by the seller or supplier of its obligations and provision by the latter of a guarantee satisfies the requirements for it to be regarded as unfair under Article 3(1) of Directive 93/13 on unfair terms in consumer contracts.

Although the Court may interpret general criteria used by the Community legislature in order to define the concept of unfair terms such as it appears in Directive 93/13, it should not, however, rule on the application of those general criteria to a particular term, which must be considered in the light of the particular circumstances of the case in question.

(see paras 22, 25, operative part)

JUDGMENT OF THE COURT (Fifth Chamber) 1 April 2004 (1)

(Directive 93/13/EEC – Unfair terms in consumer contracts – Contract for the building and supply of a parking space – Reversal of the order of performance of contractual obligations provided for under national law – Clause obliging the consumer to pay the price before the seller or supplier has performed his obligations – Obligation on the seller or supplier to provide a guarantee)

In Case C-237/02,

REFERENCE to the Court under Article 234 EC by the Bundesgerichtshof (Germany) for a preliminary ruling in the proceedings pending before that court between

and

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

THE COURT (Fifth Chamber),,

composed of: P. Jann (Rapporteur), acting for the President of the Fifth Chamber, C.W.A. Timmermans, A. Rosas, A. La Pergola and S. von Bahr, Judges,

Advocate General: L.A. Geelhoed,

after considering the written observations submitted on behalf of:

having regard to the report of the Judge-Rapporteur,

after hearing the Opinion of the Advocate General at the sitting on 25 September 2003,

gives the following

‘1.

2.…

3.‘Terms which have the object or effect of:

…

…

…’

‘1. Without prejudice to Article 7, the unfairness of a contractual term shall be assessed, taking into account the nature of the goods or services for which the contract was concluded and by referring, at the time of conclusion of the contract, to all the circumstances attending the conclusion of the contract and to all the other terms of the contract or of another contract on which it is dependent.’

‘1.

2.‘Is a term, contained in a seller’s standard business conditions, which provides that the purchaser of a building which is to be constructed is to pay the total price for that building, irrespective of whether there has been any progress in the construction, provided that the seller has previously provided him with a guarantee from a credit institution securing any monetary claims the purchaser may have in respect of defective performance or non-performance of the contract, to be regarded as unfair within the meaning of Article 3(1) of Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts?’

On those grounds,

THE COURT (Fifth Chamber),

in answer to the question referred to it by the Bundesgerichtshof by order of 2 May 2002, hereby rules:

Jann

Timmermans

Rosas

La Pergola

von Bahr

Delivered in open court in Luxembourg on 1 April 2004.

R. Grass

V. Skouris

Registrar

President