When Rudolf Gabriel of Austria received a German mailing promising a cash reward in return for placing an order, little did he realise his crusade for the prize would end up in the European Court of Justice. Osborne Clarke’s Konstantin Ewald reads the runes.
Topic: Promotion marketing
Who: Schlank & Schick GmbH and Mr Rudolf Gabriel
Where: European Court of Justice
When: July 2002
What happened:
Schlank & Schick GmbH ("S&S"), a German company, sells goods by mail order in Germany and Austria. In October 1999 Mr Gabriel, an Austrian citizen, received several personalized letters from ("S&S"). These letters created the impression that, following a draw, a prize of 3.625 Euro would be awarded to him he ordered goods for a minimum value of 15 Euro.
Choice quotes include: "Dear Mr Gabriel, you have not yet claimed your cash credit. Do you really want to forfeit your money? You are still entitled to your cash credit, but now you really must act quickly. By way of proof for you, Mr Gabriel, I have attached the payment receipt. You are entitled to 100% of your cash credit on condition that you also order goods without incurring any obligation."
Mr Gabriel filled out the required documents to claim his prize and ordered more that 15 Euro worth of goods. ("S&S") delivered the goods but the 3.625 Euro prize never materialised.
So Mr Gabriel decided to sue. He wanted to file a suit in his home state, Austria, but first of all the Austrian court had to decide whether it had jurisdiction to hear the claim. This was the issue which went all the way to the European Court of Justice.
The 2.625 Euro question was single (ish). If this was a case of alleged breach of a consumer contract the Austrian court had jurisdiction. If it was a case of alleged "delict" or extraction of money on false pretences, it would be the German court for Rudolph.
In the past the German courts had been reluctant to hold that they had jurisdiction to consider these "prize notification" claims where the notification was sent from a foreign country. The basic premise of the Brussels Convention is that persons should be sued in their home state (Article 2). This might be displaced if the case dealt with a consumer contract, but the German courts did not regard a dispute over a "prize notification" as a consumer contract dispute.
In July 2002 The European Court of Justice ("ECJ") decided, that the complaint should be classified as a consumer contract claim under Article 13 (3) of Brussels Convention, so Rudolf could sue in his local court.
Why this matters:
The European Court of Justice has substantially strengthened consumer protection with this verdict. In future, every EU consumer who has an issue with a mail order company over "prize notifications" in the context of sale of goods by mail order, can sue in the state where he is domiciled. This will be the case even if the sender of the mailing is based in another EU State.
The ECJ found out Mr Gabriel's claim was intimately linked to the contract concluded between the parties. The S&S mailing established an indissociable relationship between the promise of financial benefit in the form of the cash prize and the order for goods.
The European Court of Justice had to decide this case on the basis of the Brussels Convention on jurisdiction and enforcement of judgment. This was superseded by a new EU jurisdiction convention on 1 March 2002. This has widened still further the category of cases in which consumers can sue in their home court.
