Anthony Hubbard (Testamentvollstrecker) v Peter Hamburger (C-20/92)

Contents

Judgment of the Court (Sixth Chamber)1 July 1993^noteIn Case C-20/92,REFERENCE to the Court under Article 177 of the EEC Treaty by the Landgericht Hamburg for a preliminary ruling in the proceedings pending before that court betweenAnthony HubbardandPeter HamburgerTHE COURT (Sixth Chamber),composed of: C. N. Kakouris, President of the Chamber, G. F. Mancini, F. A. Schockweiler, M. Diez de Velasco and P. J. G. Kapteyn, Judges,Advocate General: M. Darmon,Registrar: H. von Holstein, Deputy Registrar,after considering the written observations submitted on behalf of: the Commission of the European Communities by H. Étienne, Principal Legal Adviser, and E. Lasnet, Legal Adviser, acting as Agents,having regard to the report of the Judge-Rapporteur,after hearing the Opinion of the Advocate General at the sitting on 10 March 1993,gives the following

Judgment

1By order of 11 December 1991, received at the Court on 24 January 1992, the Landgericht (Regional Court) Hamburg referred to the Court for a preliminary ruling under Article 1 77 of the EEC Treaty a number of questions relating to the first paragraph of Article 7 and Article 59 of the Treaty.

2The questions were raised in proceedings brought by Mr Hubbard against Mr Hamburger for an order vesting possession of property forming part of the testator's estate.

3Mr Hubbard, an English solicitor, acting in the capacity of an executor under English law, sought in the Landgericht Hamburg an order vesting in him property located in the Federal Republic of Germany forming part of the testator's estate. Thereupon the defendant, Mr Hamburger, demanded security for costs pursuant to the first sentence of Paragraph 110(1) of the Zivilprozeßordnung (Code of Civil Procedure).

4According to that provision, foreign nationals who act as plaintiffs in proceedings brought before German courts must, upon application by the defendant, give security for costs and lawyers' fees. Paragraph 110(2)(1) provides, however, that this obligation does not apply where the plaintiff is a national of a State which does not require such security to be given by German nationals.

5Article 14 of the German-British Convention on the conduct of legal proceedings of 20 March 1928, brought into force again with effect from 1 January 1953 (Bundesgesetzblatt 1953, II, p. 116), provides that the nationals of one Contracting Party are not to be compelled to give security for costs in the territories of the other Contracting Party only if they are resident therein. In addition, the European Convention on Establishment signed in Paris on 13 December 1955 (Bundesgesetzblatt 1959, II, p. 998) exempts from the requirement to give security for costs all nationals of Contracting States, provided only that they have their domicile or normal residence in one of the Contracting States. That rule, however, does not apply to nationals of States which have made a reservation under Article 27 of the Convention, as the United Kingdom has.

6As a result of that reservation, Mr Hubbard is unable to qualify for the exemption provided for in the Paris Convention. Since he does not reside in Germany he is also unable to rely on the bilateral German-British Convention.

7Since it took the view that the outcome of the dispute depended on the interpretation of Community law, the Landgericht Hamburg referred the following questions to the Court for a preliminary ruling:1. Where a British solicitor is acting in Germany in his capacity as an executor under English law and has brought an action in his own name before a German court for the handing over of a deceased person's assets, does it constitute an infringement of his rights under Community law — in particular his right to freedom to provide services — if the German court, pursuant to the first sentence of Paragraph 110(1) of the German Code of Civil Procedure and at the defendant's request, orders that security be provided for the costs of the proceedings which has the consequence in law that the defendant does not have to enter an appearance before security is lodged?2. Is the application of the EEC Treaty particularly affected by the fact that rules have been laid down on the question of the provision of security in proceedings in German courts involving British plaintiffs without a residence or any real property in the Federal Republic of Germany by, on the one hand, Article 14 of the German-British Convention on the conduct of legal proceedings of 20 March 1928 (Reichsgesetzblatt II, p. 623; brought into force again with effect from 1 January 1953, Bundesgesetzblatt II, p. 116) and, on the other, Article 9 of the European Convention on Establishment signed in Paris on 13 December 1955 {Bundesgesetzblatt 1959 II, p. 998)?3. Does the factual situation referred to in question 1 lead to a breach of the first paragraph of Article 7 of the EEC Treaty?4. Does the fact that the plaintiff's claim may possibly in substantive law terms, having regard to the application, also be classified under the law of succession lead to a material restriction in the scope of application of the EEC Treaty or other provisions of Community law?’

8Reference is made to the Report of the Judge-Rapporteur for a fuller account of the relevant law and the facts of the main proceedings, the procedure and the written observations submitted to the Court, which are mentioned hereinafter only in so far as is necessary for the reasoning of the Court.

The first and third questions

9By its first and third questions the national court essentially seeks to establish whether it is contrary to the first paragraph of Article 7 and Articles 59 and 60 of the Treaty for a Member State to require security for costs to be given by a member of a profession established in another Member State who brings an action before one of its courts, on the sole ground that he is a national of another Member State.

10It should be noted in limine that, according to Article 7 of the Treaty, the prohibition of discrimination is effective ‘within the scope of application of [the] Treaty’ and ‘without prejudice to any special provisions contained therein’. The latter phrase in Article 7 refers in particular to other Treaty provisions implementing the general principle which it lays down in specific situations. That is the case, inter alia, of the provisions relating to freedom to provide services (see Case C-186/87 Cowan v Tresor public [1989] ECR 195).

11In order to reply to the national court's questions, it is therefore necessary first to ascertain whether activities such as those at issue in the main proceedings where the provider and the recipient are established in the same Member State but the provision of services is carried out in another Member State come within the scope of application of Articles 59 and 60 of the Treaty.

12In that respect, it should be noted that in the so-called ‘tourist guide’ cases (Case C-154/89 Commission v France [1991] ECR I-659, paragraph 10; Case C-180/89 Commission v Italy [1991] ECR I-709, paragraph 9; and Case C-198/89 Commission v Greece [1991] ECR I-727, paragraph 10) the Court held that the provisions of Article 59 must apply in all cases where a person providing services offers those services in a Member State other than that in which he is established, wherever the recipients of those services may be established.

13Where such a service is provided by a member of a profession and therefore, as required by Article 60 of the Treaty, is normally provided for remuneration, the principle of equal treatment laid down in Article 59 applies.

14Next, it must be held that the fact that a Member State requires security for costs to be given by a national of another Member State who, in his capacity as an executor, has brought an action before one of its courts, whilst its own nationals are not subject to such a requirement, constitutes discrimination on grounds of nationality contrary to Articles 59 and 60.

15The reply to the national court's first and third questions must therefore be that Articles 59 and 60 must be interpreted as precluding a Member State from requiring security for costs to be given by a member of a profession established in another Member State who brings an action before one of its courts, on the sole ground that he is a national of another Member State.

The second question

16By its second question the national court seeks to establish whether the existence of international agreements based on the principle of reciprocity and providing in certain cases for exemption from the requirement to give security for costs may have an effect on the application of the Treaty.

17Suffice it to say in reply to that question that, as the Court has consistently held, the right to equal treatment laid down in Community law may not be made dependent on the existence of reciprocal agreements concluded by the Member States (see Case 1/72 Frilli v Belgian State [1972] ECR 457 and Case 186/87 Cowan v Trésor public [1989] ECR 195).

The fourth question

18By its final question the national court essentially asks whether the fact that the substantive proceedings come under the law of succession justifies excluding the application of the Treaty.

19On that point, it should be observed that, as the Court held in Case 82/71 Pubblico Ministero Italiano v SAIL [1972] ECR 119, paragraph 5, the effectiveness of Community law cannot vary according to the various branches of national law which it may affect. In this case, the national law affected by Community law is not the law relating to the substantive proceedings but national procedural law.

20The reply to this question must therefore be that the fact that the substantive proceedings come under the law of succession does not justify excluding the application of the right to freedom to provide services enshrined in Community law with respect to a member of a profession responsible for the case.

Costs

21The costs incurred by the Commission of the European Communities, which has submitted observations to the Court, are not recoverable. Since these proceedings are, for the parties to the main proceedings, in the nature of a step in the proceedings pending before the national court, the decision on costs is a matter for that court.

Operative part

On those grounds,THE COURT (Sixth Chamber),in answer to the questions referred to it by the Landgericht Hamburg, by order of 11 December 1991, hereby rules:

1.Articles 59 and 60 of the EEC Treaty must be interpreted as precluding a Member State from requiring security for costs to be given by a member of a profession established in another Member State who brings an action before one of its courts, on the sole ground that he is a national of another Member State.

2.The right to equal treatment laid down in Community law may not be made dependent on the existence of international agreements concluded by the Member States.

3.The fact that the substantive proceedings come under the law of succession does not justify excluding the application of the right to freedom to provide services enshrined in Community law with respect to a member of a profession responsible for the case.

Delivered in open court in Luxembourg on 1 July 1993.