The Constitutional Court annuls decisions unfavorable to borrowers in Swiss francs


STA, February 1 – The Constitutional Court has overturned the decisions of two courts that rejected the borrowers’ request to cancel contracts for Swiss franc loans and reimbursement of overpayments, in what is the first decision of the most High Court of Slovenia regarding the granting of loans in francs.

The Constitutional Court found that the judgments did not adequately address concerns about the assessment of banks’ level of disclosure obligation and that of fairness, and remanded the cases for reconsideration.

The decision concerns the decisions of the Ljubljana District Court of July 2019 and the Ljubljana High Court of May 2020, which were appealed by spouses Igor and Simona Ajdnik.

As the nation’s highest court said in its ruling, the appellants had noted the sensitivity of the issue as they had taken out a loan in Swiss francs to buy a family home, and the risky nature of the deal.

They also drew attention to the negative consequences of the operation and the increase in the price of the loan for their social status and family life, and noted the bank’s knowledge of exchange rate market risks.

The court said that the contested decisions were based on the premise that the fairness of the main object of the contract, namely the monetary clause in Swiss francs, is not assessed in the event that the obligation of disclosure is fulfilled. , and the assessment that the disclosure obligation had been fulfilled in the case in question.

The two courts had found that the exchange clause had not been abusive, supporting the idea that the bank had acted in good faith by specifying that at the time of the conclusion of the loan contract, it could not anticipate variations significant changes in the exchange rate to the detriment of customers, and that he did not give specific or misleading guarantees.

The Constitutional Court also noted that the two courts had held that there was no significant imbalance in the contractual rights and obligations because the bank had also borne the exchange risk and was required to provide adequate guarantees, a modification of the exchange ratio bringing no benefit. .

The case law of the Court of Justice of the EU stipulates that in the case of a loan in Swiss francs, the customer must be informed in clear and understandable language of all the mechanisms which affect the repayment of the loan and their consequences in order to to make a prudent and understandable decision. informed decision.

If this is not the case, the court must make an assessment of fairness, i.e. whether the bank acted in good faith or not, and whether it acted in accordance with the principle of conscience, and whether there is a significant imbalance of rights and obligations between the parties.

Due to the importance of the case law of the constitutional questions raised by the positions taken by the two courts, the Constitutional Court decided to test these positions in their entirety, that is to say with regard to the duty of disclosure. and in equity.

She indicated that it was not clear from the explanatory notes of the contested decisions which explanation of the bank could make the borrower aware of the real consequences of a sharp depreciation of the national currency or a rise in the exchange rate. of the Swiss franc on the amount of the loan obligation.

As one of the key elements of the duty of disclosure standard, the courts have violated the right to a reasoned court decision under article 22 of the constitution.

With regard to the assessment of fairness, the petitioners drew attention throughout the proceedings to the bank’s professionally qualified knowledge of the risks of the foreign exchange market, the Constitutional Court said.

On the basis of the 1993 European directive on unfair terms in contracts concluded with consumers and the criteria of interpretation developed by the Court of Justice, the applicants’ arguments constitute an element of assessment of the unfair nature of a condition contract that must be taken into account.

Failing to take a position on these arguments, the courts violated the petitioners’ right to a trial under Article 22 of the Constitution, the Constitutional Court added.

The decision, published on Tuesday, was made by five votes to three, with Constitutional Judge Rok Svetlič issuing a dissenting opinion and Constitutional Court President Matej Accetto issuing a concurring opinion.

The Association of Banks of Slovenia stated in a response that the Constitutional Court did not come to the conclusion that the Swiss franc loan contracts were null and void, but that it mainly examined certain positions taken by the courts.

“The Constitutional Court noted that the lower courts did not rule on all the essential arguments of the appellants and on the evidence. These procedural grounds therefore refer to the courts and not to the banks”, added the association.

He also noted a dissenting opinion that if banks were to be forced to consider (all) the personal circumstances of customers in the future, the effect would be adverse precisely for borrowers.

The association added that the decision of the Constitutional Court further confirmed that the cases of Swiss franc borrowers should be assessed on an individual basis and that it was not appropriate to regulate such matters by legislation.

It comes as the National Assembly debates a bill that would split the cost of the Swiss franc’s surge in 2015 between banks and some 32,000 borrowers who have seen the cost of their euro debt soar as a result. .

Slovenian banks have strongly opposed the bill, claiming that it retroactively encroaches on legally concluded contracts, which is not only detrimental to banks but to the whole economy.


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