European Court of Justice: national courts required to examine unfairness of contract terms of their own Motion

Council Directive 93/13/EEC on unfair terms in consumer contracts provides that unfair terms used in a contract concluded with a consumer by a seller or supplier are not binding on consumers. In a decision of June 4th, 2009 (Case C—243/08 – Pannon GSM Zrt. v. Erzsébet Sustikné Győrfi) ECJ held that the protection which the Directive confers on consumers extends to cases in which a consumer who has concluded with a seller or supplier a contract containing an unfair term fails to raise the unfairness of the term, whether because he is unaware of his rights or because he is deterred from enforcing them on account of the costs which judicial proceedings would involve. As a consequence, the role of the national court in the area of consumer protection is not limited to a mere power to rule on the possible unfairness of a contractual term, but also consists of the obligation to examine that issue of its own motion.Where the national court considers such a clause to be unfair, it must not apply it, unless the consumer, after having been informed of it by the court, does not intend to assert its unfairness and non-binding status.Source: ECJ press release No 46/09

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