ECJ, February 21, 2013, case C-472/11, Banif Plus Bank Zrt c/ Csaba and Viktoria Csipai

The national judge must assess whether a contractual clause is abusive and must do so taking into account the entire agreement. In doing this, he must give both parties the opportunity to submit their observations.

Mr. Csipai had taken out a loan with the Hungarian bank, Banif Plus Bank ("the bank"). Clause 29 of the agreement stipulated that in the event of early termination on grounds of conduct attributable to the borrower, the latter had to repay all the remaining loan instalments, plus interest on the loan and the insurance premium.

Following the borrower's failure to repay the loan, the Hungarian bank had terminated the agreement and demanded the repayment of all outstanding amounts. Faced with Mr. Csipai's refusal to pay, the bank brought proceedings before the Hungarian court, which informed the parties that it considered clause 29 to be abusive and invited the parties to submit their observations. Mr. Csipai having been ordered to pay an amount calculated without applying clause 29, the bank appealed the judgement.

The Hungarian Court of Appeal stayed the proceedings and questioned the ECJ to determine whether, with regard to EC directive 93/13, (i) the national judge, having held a clause to be abusive, could declare it invalid without the parties having submitted a claim to such effect; whether (ii) the judge could invite the parties to submit a statement, and whether (iii), during the examination of the clause in question, the judge had to examine the other clauses of the agreement.

The ECJ stated that in order to ensure the full effectiveness of directive 93/13, the national judge is obliged to assess the potential abusive nature of a clause and to draw the consequences therefrom without waiting for the consumer to ask for it to be invalidated. The EJC went on to recall that in its assessment of the abusiveness of the clause in question, the judge must take into account the circumstances surrounding its conclusion as well as all the other clauses of the agreement.