Background
Jurisdiction
Procedure
Evidence
Judgment and remedies
Recognition and enforcement of foreign judgments
Background
The Danish judicial system is divided into the ordinary courts and the special courts. The ordinary courts hear all disputes that, for lack of a special character, have not been referred to other courts or authorities.
In 2007 the biggest reform of the judicial and police system in recent times came into effect. The number of lower courts was reduced by more than 50% and all disputes had to be instituted before the lower courts, regardless of their size and value. Other changes include new procedural rules for small cases, the possibility of court-based mediation and class actions.
The ordinary courts comprise 24 lower courts, two High Courts (with a court in both the eastern and western parts of Denmark) and the Supreme Court. Furthermore, the Maritime and Commercial Court, located in Copenhagen, is also classified as an ordinary court.
The most important special courts are the probate courts and the courts dealing with the relationship between landowners and tenants. These courts rank alongside the lower courts in the hierarchy of the Danish courts.
A High Court case is heard by three judges, whereas normally just one judge hears a lower court case. The lower court can be entered by expert judges or can consist of three judges if::
- the case is of general public importance;
- the outcome will have an effect on others besides the parties;
- the case deals with particularly difficult questions; or
- the special character of the case exceptionally demands it.
Generally, a court ruling may be appealed once. In certain circumstances the Judicial Board for Appeal may grant special leave to appeal so that a judgment rendered by the lower court may ultimately be decided by the Supreme Court.
The organisation of the courts and the applicable procedural rules are laid down in the Administration of Justice Act.
Jurisdiction
Section 235 of the Administration of Justice Act stipulates that cases must be instituted before the court closest to the defendant's place of residence. If the defendant does not have a known residence in Denmark or abroad, a case may be instituted before the court where the defendant is temporarily located. Otherwise, the case will be instituted before the court where the defendant is known to have last resided.
Consumer agreements
Consumer agreements concluded away from the seller's business premises can always be instituted before the consumer's home court.
Legal entities
Legal corporations and partnerships are deemed to be domiciled in the jurisdiction where their principal office is located. If the corporation has no principal office or the relevant information cannot be obtained, the case will be heard in the jurisdiction where a member of the board of directors or of the management is domiciled.
The domicile of a limited company is deemed to be the domicile registered in the company's articles of association.
In certain circumstances a plaintiff may institute legal proceedings before a court other than the court of the defendant's domicile.
Immovable property
With respect to immovable property, cases may be instituted in the jurisdiction where the immovable property is situated.
Contractual claims
In contractual matters, proceedings may be instituted against the defendant before the court of the place of performance of the obligation in question. However, under Danish law, this rule does not apply to claims for monetary payments, for which the jurisdiction is always that of the creditor.
International jurisdiction
As a member of the European Union, Denmark has ratified the 1968 Brussels Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters (as amended). The convention provides that proceedings can be instituted against individuals domiciled in the European Union in member states only when its requirements have been met.
A similar protection is granted through the Lugano Convention to individuals domiciled in European Free Trade Association (EFTA) countries that are not EU member states.
On March 1 2002 the Brussels Convention(1) was replaced by new provisions. However, Denmark is not party to the provisions because of reservations in respect of the Amsterdam Treaty. In 2007 Denmark ratified a bilateral agreement making the Brussels Convention enforceable in Denmark.
For persons domiciled outside the European Union and EFTA countries, jurisdiction in Denmark may be established on the basis of temporary presence or property belonging to the defendant. Consumers domiciled in Denmark have the right to sue vendors or producers domiciled outside Denmark if the product was advertised or offered for sale in Denmark before the purchase.
Choice of jurisdiction
Alternatively, jurisdiction may be established by agreement. Traditionally, Danish courts accept jurisdiction clauses where the agreement between the parties is clear. The only exceptions are that the court agreed on must be a lower ordinary court and that the court will not accept jurisdiction over disputes that have no relation to Denmark.
Denmark has ratified the Hague Convention on choice of venue agreements from 2005.
International conflicts of law
In general, Danish courts do not apply foreign law, nor are they obliged to familiarise themselves with foreign law. Rather, the parties in question must inform the courts if foreign law is applicable and the nature of the foreign law to be applied. However, a choice of law clause will be accepted by the courts and will not be contrary to any Danish statutes except in certain consumer-related cases.
Denmark has ratified a number of conventions which, among other things, deal with the choice of law. One of the most important is the EU Convention of Choice of Law on Contractual Obligations (the Rome Convention). As of December 17 2009, the Rome 1 Regulation replaced the Rome Convention as the applicable set of rules for the resolution of contractual disputes in all EU member states except Denmark. In Denmark the first Rome Convention still applies.
One overriding principle of all the conventions, consistent with the principles applicable under Danish international conflict of law rules, is that the intention of the parties must be taken into consideration. Otherwise, the law of the country that has the closest connection to the case will apply.
Procedure
Statement of claim
According to Section 348 of the Administration of Justice Act, an action is instituted when a writ or statement of claim is filed with the court. The writ must contain certain minimum information that is defined in the act. The information required includes:
- the names and addresses of the parties or their accommodation address;
- the name of the relevant court;
- the plaintiff's claim;
- evidence to be submitted;
- a detailed statement of facts; and
- a suggestion in relation to the number of judges and if the court is to be set with expert judges.
Statement of defence
When the statement of claim has been served on the defendant, the court gives the defendant a deadline - normally four weeks - to submit its statement of defence.
If the defendant fails to submit a statement of defence, the court may render a default judgment with the possibility of reopening.
Defendants domiciled abroad should be aware that any objections to Danish jurisdiction must be made during the preliminary hearing (or in the statement of defence); otherwise the defendant will be deemed to have accepted the jurisdiction of the Danish court.
Reply and rejoinder
Usually either party is entitled to exchange at least one further written pleading. There are no formal requirements as to the contents of the pleadings, although they should concentrate on issues that were not reviewed in sufficient detail in the statement of claim and defence.
Small case procedure
One of the objectives with the reform of the judicial system in Denmark was to make it easier for individuals and smaller businesses to institute legal proceedings. These groups often have smaller claims which are not proportional to the traditionally high costs of legal proceedings. It often hindered small claims from being pursued and thus in reality a large group did not have access to the court system.
In order to solve this problem, a special and simplified procedure has been introduced in Part 39 of the Administration of Justice Act applying to claims of less than DKK50,000 or if the parties agree that the procedure should apply to their case. Expenses are reduced by giving the courts an obligation to help the parties with the preparation of the case; in addition, the number of court meetings are reduced and the legal costs awarded are limited.
Evidence
Witnesses
The parties have a right to choose the evidence they produce evidence freely and to decide who they want to call as witnesses.
The witnesses are obliged to appear before the court. They are only relieved of such obligation if by law they have a duty of confidentiality. The court may fine the witness once or several times if the witness does not appear in court without sufficient excuse and, if they still do not appear, it may take them in to custody for up to six months. This also applies to cases where the witness appears in court, but refuses to answer the questions.
Expert opinions
Expert opinions have become a vital instrument in comprehending complicated and technically detailed cases and they therefore are widely used as evidence by the parties.
Either party may request that an expert is appointed to answer questions, but it is the court that appoints the expert. The parties will be given the opportunity to comment on the appointment of the expert before the final decision is made.
The party which has requested to appoint an expert prepares written questions to be presented to the expert and the opposing party has a right to comment on such questions or make additional questions.
The expert will respond with a written report. Furthermore, the expert may appear before the court in order to give a thorough explanation which corrects or supplements the report.
At first it is the party that has requested the expert that pays the costs of the report being made. The cost may be reimbursed by the other party in accordance with the rules mentioned below.
Use of experts in small cases
The court must give its permission to the production of evidence because irrelevant evidence may make the process unnecessarily expensive. If a party requests that an expert opinion be obtained, the court may prepare questions to an expert or organisation.
Expert opinions commissioned by one party
The principal rule in Danish law is that expert opinions commissioned by one party cannot be produced if the opposing party objects. If the expert opinion is commissioned before the proceedings are to commence (the statement of claim has been handed in), the court will often allow such expert opinion.
Judgment and remedies
Final judgment
Before a case is decided, it is possible that the court may have delivered a partial judgment following in-court oral pleadings.
The final and full text of the judgment will include a summary of the claims and the factual circumstances of the case as well as a record of the witness statements given and a summary of the parties' claims and allegations. It will also include a reference to the factual and legal circumstances that were relevant to the final decision. The court is restricted by the claims filed by the parties, and may not grant a higher amount than that claimed. Similarly, the court may only take into consideration the claims and arguments that were made or that cannot be omitted by law.
Execution of judgment
Judgments providing for enforcement are enforceable unless the judgment debtor voluntarily honours the claim of the judgment.
The debtor has 14 days to honour the judgment unless the court specifies otherwise. It may be ruled that enforceability can take place even if the debtor has appealed against the decision.
Appeals
Generally, decisions may be appealed once and the case tried by a higher court. Further appeals will require leave to appeal by the Judicial Board for Appeal. The board only grants leave if the case concerns a matter of legal principle. An appeal to the High Court must be lodged within four weeks of the original decision, whereas an appeal to the Supreme Court must be lodged within eight weeks of the High Court ruling.
An appeal is deemed to be lodged when the request for appeal has been delivered to the office of the appeal court.
Costs
In order to institute proceedings before a Danish court, the plaintiff must pay a court fee, which falls due when the statement of claim is filed with the court. The court fee is intended to cover general court costs.
The initial court fee for monetary claims is 1.2% of the claim plus DKK150. The same amount is payable when the preparation of the case is finalised and a date for the final hearing has been fixed. The fee in a small procedure case is always DKK500.
Fees payable to technical experts and the parties' attorneys must be paid by the parties themselves, albeit with the possibility of full or partial reimbursement by the losing party. When a judgment has been rendered, the court decides whether costs will be awarded. It is not necessary for a party to submit a formal claim for costs.
Section 312 of the Administration of Justice Act stipulates that the losing party must reimburse the winning party's costs and expenses, unless the parties have reached a separate agreement or the court decides otherwise.
If neither party can be said to have won the case, neither is awarded any costs. Where the court orders the losing party to reimburse the winning party, costs are fixed at a round figure. Usually, expenses relating to the use of experts are reimbursed by actual costs, provided that the use was reasonable. The legal costs are reimbursed on the basis of the amount of the claims in dispute, and it is not often that the costs awarded correspond to the actual legal costs used in the dispute.
Foreign and Danish nationals are treated equally during court proceedings, although foreigners may be required to pay security for costs (at the defendant's request and if the court deems it fit). However, a plaintiff domiciled in another EU member state may not be required to pay security for costs if the claim relates to commercial activities.
Recognition and enforcement of foreign judgments
European Union
According to Article 33 of the Brussels I Regulation, member states are obliged to recognise judgments rendered in another member state. Denmark is not subject to the regulation as it has a reservation regarding legal issues. However, Denmark has chosen to accept the regulation by bilateral agreement. As a result the courts in Denmark have an obligation to recognise judgments rendered within the European Union without requiring a special procedure.
There are modifications to the obligation of recognition. The courts should not recognise a judgment if it is manifestly contrary to fundamental legal principles in Denmark or if there has not been a timely and proper writ of service. If the judgment is incompatible with a judgment already rendered in Denmark or an earlier yet enforceable judgment regarding the very same dispute has been made in another member state or third country, the courts will not recognise and enforce the judgement.
The courts have to enforce foreign judgments rendered in EU member states, and they can only refuse this when there are reasons as specified above.
Other countries
The minister of justice is authorised to issue orders making foreign judgments enforceable. This authorisation has not been in use. It is therefore only when there is an international obligation by convention that the courts have to enforce a foreign judgment. Aside from the agreements concerning the European Union and the Lugano countries, these are very few and limited to very specific areas.
For further information on this topic please contact Peter Schradieck at Plesner by telephone (+45 33 12 11 33), fax (+45 33 12 00 14) or email ([email protected]).
Endnotes