Judgment of the European Court of Justice on Unfair Contract Terms

A court before which a consumer claims that certain contractual terms are unfair is required to review, of its own motion, other terms of the contract insofar as they are connected to the subject matter of the dispute before it.

It must, where necessary, take investigative measures in order to obtain the legal and factual

In December 2007, Mrs Györgyné Lintner concluded with UniCredit Bank Hungary a mortgage loan contract denominated in a foreign currency. That contract contains certain terms according UniCredit Bank the right to make unilateral amendments to its content at a later stage. Subsequently, Mrs Lintner brought an action before the Hungarian courts seeking a declaration of invalidity of those terms, with retroactive effect, on the basis of the Unfair Contract Terms Directive (‘the Directive’), which provides, among other things, that unfair terms included in contracts concluded between a consumer and a seller or supplier will not bind the consumer.

By It’s judgment, the Court clarifies that the court before which a consumer brings a claim that certain terms in a contract that it entered into with a professional are unfair is not required to examine, of its own motion and individually, all the other contractual terms, which were not challenged by the consumer, in order to ascertain whether they are unfair.

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