The Appeal in German Civil Procedure and the Length of the Process

1

Rüdiger Ernst

Judge at the Higher Regional Court

Berlin / Germany

The appeal in German civil procedure and the length of the process:

Facts and figures, problems and solutions

A. Introduction: federal courts constitution and appellate remedy system

The court structure in Germany and the appellate remedy system (stages of appeal) are complicated and not easy to understand. Many say that the appellate remedy system is more complicated than needed.

Everything that I will talk about in the next 20 minutes has been simplified. Each principle and rule has its exceptions. For reasons of time, I will restrict my comments to the fundamental principles.

The Federal Republic of Germany has 17 individual judicial systems. Figuratively speaking, this is like a cosmos comprising 17 planetary systems. Why is that? The Federal Republic of Germany is a federal state that consists of 16 Laender. Each one of these has its own complete court system. On top of this, there is a nationwide network of (five) supreme federal courts. Not including the constitutional courts at the federal and Laender levels, there are 1,089 courts with 20,382 judges. Of these, 459 serve on federal courts and 19,923 on Laender courts [2012]).

In each of the 16 Laender, and at the federal level, five types of courts are structured side by side – like pillars. Civil courts and criminal courts form one pillar. The four other pillars comprise finance courts, labour courts, social courts and administrative courts. Each pillar has one lower and one higher[1] as well as a supreme court. In civil justice, the area I will be focusing on here, there are even four levels of courts (just like in criminal justice).

B. The appellate remedy system in civil action: appeal and revision (Berufung and Revision)

(not including family matters)

The civil justice court system has four tiers:

Federal Court of Justice
Higher regional courts / at least one per Land, 24 in total
Regional courts / at least one per higher regional court district, 115 in total
Local courts / 650 in total

Both the local courts and the regional courts are first instance courts. Local courts have jurisdiction for disputes up to a value of 5,000 euros, and regional courts for disputes over 5,000 euros. If the local court is the court of first instance, it is possible to lodge an appeal against the judgement at a regional court and then to lodge a revision against the judgment atthe Federal Court of Justice. If the regional court is the court of first instance, it is possible to lodge an appeal against the judgment at a higher regional court and then to lodge a revision at the Federal Court of Justice.

What is the difference between appeal and revision?

As you can see, there are two different, successive forms of appellate remedy against the ruling of the court of first instance: appeal and revision. The appeal opens the way for a judgment rendered by the court of first instance to undergo a factual and legal review. In turn, the revision merely opens the way for the legality of the appeal judgment to be reviewed. For example, the court of appeal may re-hear witnesses or hear other witnesses. Or they can commission a new expert opinion. As a rule, the court of appeal decides on the matter itself. (It very rarely refers the legal dispute back to the court of first instance). In turn, the court of revision is bound to the established facts as recorded by the court of first instance and the court of appeal. If the revision is successful, the court of revision can reach a decision on the matter itself provided that a decision can be reached based on the actual findings. The court of revision is therefore not limited to the cassation of the disputed ruling. The decision can therefore be overturned. However, if the court of revision believes that more facts must be established, it will revoke the ruling and refer the matter back to the court of appeal for a new hearing at which a new judgment will be rendered.

Can any ruling be disputed using appellate remedy?

An appeal is only permissible if either the amount in dispute exceeds 600 euros or if the court of first instance allows for an appeal in its ruling. The court of first instance will allow an appeal if the case is of fundamental importance or the development of the law or the ensuring of uniform jurisdiction require a decision by the court of appeal. The aim of introducing an appeal based on admissibility in addition to an appeal based on value (in the year 2002) is to also allow minor disputes of particular significance to be referred to a court of appeal and then to a court of revision (Federal Court of Justice).

The revision only takes place in one of two instances: either the court of appeal rules that it is permissible or the court of revision rules in favour of a complaint against a decision that the appeal is not permissible. A revision must be permitted if either the case is of fundamental importance orthe development of the law or the ensuring of uniform jurisdictionrequires a decision by the court of revision. The admissibility of a revision does not depend (no longer depends) on whether a (high) amount in dispute on revision or a (high) value of a gravamen has been exceeded (as was the case with the previous value-based revision). There had been criticism that the previous version of the revision was an appellate remedy “for the rich” because of its value-based approach.[2]

However, an inadmissibility complaint (with which a revision can be sought that has not been granted) is only permissible if the gravamen is above a value of 20,000 euros.[3]

How do the proceedings at the court of appeal work?

Regardless of whether it is a regional or a higher regional court, the decisions reached by the court of appeal are taken by a panel that comprises three full-time judges. The court of appeal only ever reaches its decisions after oral proceedings and must always provide detailed reasons for its decision. Since the Code of Civil Procedure was reformed in 2002, the appeal does not constitute a full-record court (any more) in which the legal dispute is "re-heard". Instead, the proceedings at a court of appeal primarily serve to review and remedy any errors that may have been made in the judgment passed by the court of first instance. Regional courts hear around 58,000 appeals per year (2012). Higher regional courts hear around 53,000 (2012). On average, the proceedings at a court of appeal at a regional court last 6.2 months (2012) – if the dispute is resolved by a court ruling, it takes 8.7 months. A higher regional court needs 8.6 months (2012) – if the dispute is resolved by a court ruling, then 11.4 months.

In comparison: the average time for proceedings at first instance (2012) is 4.7 months for local courts (7.2 months if the dispute is resolved by a court judgment) and 8.4 months for regional courts (13.9 months if the dispute is resolved by a court judgment).

The court of revision (the Federal Court of Justice) reaches its decision with a panel of five full-time judges. Every year, the Federal Court of Justice receives between 5,000 and 6,500 new appellate remedy cases (these include family matters, however).

Each time legislators attempt to amend the laws governing appellate remedy, the legal and political significance of appellate remedies is pointed out time and time again:[4]

- Appellate remedies increase the chances of ensuring that the right decision is reached. The admissibility of appellate remedies places healthy pressure on the lower courts to justify their decisions carefully. It therefore equalises judicial independence.

- Appellate remedies serve to secure uniform jurisdiction if proceedings ultimately end up in a supreme court or a few higher courts, whilst jurisdiction of the lower courts must remain unclear and fragmented given their large number. With 650 local courts, 115 regional courts and 24 higher regional courts throughout the country, the function of uniform jurisdictionis of great importance. The required development in jurisdiction can only be achieved through the jurisdiction of the higher courts whose rulings are published. Extending the appellate remedies therefore not only serves the interests of the individual parties but also the administration of justice as a whole. This is especially true of the revision.

- Appellate remedies also have their disadvantages: they delay proceedings and make them more expensive.

C. Duration of appellate appeal proceedings

1. Constitutional stipulations – rulings of the Federal Constitutional Court

Judicial review can only be effective if it does not come too late. The guaranteed judicial review that is derived from the principle of a state governed by the rule of law does more than just ensure that there is legal recourse to the courts. In the interests of legal certainty, the principle of a state governed by the rule of law requires that legal relations under dispute are resolved within a reasonable amount of time.[5]

However, the Federal Constitutional Court has never provided an absolute figure to define what a reasonable amount of time to resolve a civil dispute is. Instead, it has emphasised in its rulings that there is no generally-accepted timeframe for determining whether proceedings have gone on for a disproportionately long time. The Federal Constitutional Court instead has stated that all of the individual circumstances must be taken into account.[6] The main criteria put forward by the Federal Constitutional Court in determining this are:

• the nature of the proceedings and the significance of the case to the parties;
• the impact of long proceedings for the parties concerned;
• the level of difficulty of the matter and the conduct that can be attributed to the parties concerned (especially delays in the proceedings caused by them) as well as
• third-party activities beyond the court’s control, in particular those of experts.

Generally speaking, the Federal Constitutional Court requires that, the longer the proceedings continue, the more the court of decision must work to ensure that the proceedings are accelerated.[7]

2. Stipulations of the ECHR – Rulings of the ECtHR

Sect. 6 (1) (1) of the ECHR also states this unequivocally.

In the past, not only have national courts therefore had to deal with a large number of complaints because of overlong proceedings but also the European Court of Human Rights (ECtHR). Over half of all judgments against the Federal Republic of Germany that determined the country were in breach of the ECHR related to the duration of the proceedings.[8]

The ECtHR judgment passed on 26 October 2000 (No. 30210/96) marked the first time that overlong proceedings could not only be in breach of Art. 6 (1) of the ECHR, which ensures the right to a fair and swift trial, but also of Art. 13 of the ECHR, which guarantees the right to effective remedy. In the view of the ECtHR, Art. 13 of the ECHR calls for a legal remedy before a national authority with which the infringement of the right to judicial review can be effectively asserted within a reasonable time.

In a large number of proceedings against the Federal Republic of Germany, the ECtHR has, in the past, pointed out that, in contrast to Art. 13 of the ECHR in conjunction with Art. 6 of the ECHR, German law has no effective legal remedies that allow the parties concerned either to accelerate the court’s decision or to obtain any appropriate indemnification for a delay that has already occurred.[9]

When checking whether court proceedings are taking a disproportionately long time, the ECtHR also points out that each case must be reviewed on its own merits. In this context, the ECtHR applies three aspects in particular in permanentjurisdiction:

• the complex nature and difficulty of the case;
• the conduct of the appellant and the court; and
• the significance of the legal dispute for the appellant.[10]

It goes without saying that this issue of overlong proceedings not only impacts the appeal proceedings but also the proceedings at the court of first instance. Given the general topic of this conference, I would like to focus solely on the appellate courts and especially on the appeal proceedings.

D. Measures / solutions / attempted solutions

In this next section, I would like to present a series of measures and solutions, or attempted solutions, that have been undertaken in the past few years with the aim of shortening the length of time that civil proceedings – and appeal proceedings in particular – take. I would like to add, however, that this is not an exhaustive list.

1. Decision taken by a judge sitting alone (Section 526 Code of Civil Procedure)

Following the reform of the Code of Civil Procedure in 2002, it became possible for the parties to agree to the legal dispute under appeal to be referred to a judge sitting alone for him or her to make a decision. In straightforward cases, the panel of judges can transfer the matter to one of its members as a judge sitting alone. The purpose of doing so is to use human resources wisely (parliamentary paper 14/4722, p. 65). Thus, in contrast to the court of first instance, a heavily restricted regulation governing judges sitting alone should be reached in the appeals procedure. It follows from this that the appeal proceedings (including before a regional court) should be conducted and decided by the panelin cases that are of greater significance.[11] Of the 58,241 appeals ruled on by the regional courts in 2012, 7,455 were ruled on by a judge sitting alone (12.8%). Of the 50,868 appeals ruled on by the higher regional courts, 4,060 were ruled on by judges sitting alone (8%).

2. No oral hearing for appeals with no chance of success (Section 522 (2) ZPO)

Following the reform of the Code of Civil Procedure in 2002 – and following extensive political debate – it became possible for the court of appeal to reject appeals that had no chance of success without having to hold anoral hearing. The aim of avoiding the need to set a hearing date was to save on judges’ resources (parliamentary paper 14/4722, p. 97). In the case of “unsubstantial” appeals, the aim was to swiftly establish the unappealability of the decision passed by the court of first instance in the interests of the plaintiff. At present, the requirements for this are as follows:

The court of appeal is to immediately deny leave of appeal if all of the members are unanimously satisfied that

1. the appeal manifestly has no chance of success;

2. the legal matter is not of any fundamental significance;

3. the further development of the law or the interests in ensuring uniform adjudicationdo not require a decision to be handed down by the court of appeal; and

4. no hearing for oral argument is mandated.

Prior to handing down such a ruling, the court of appeal or the presiding judge is to indicate to the parties to the dispute its intention to deny leave to appeal and the reasons therefor, and is to provide the plaintiff in the appeal with the opportunity to submit its position within a period of time to be set.

3. Censure of delay and claims for compensation for excessively long court proceedings

Against the backdrop of the rulings of the Federal Constitutional Court and especially the ECtHR, and following extensive legal and political debate, the “Law on Judicial Remedies in Court Proceedings and Criminal Investigations of Excessive Length” came into force on 3 December 2011.[12]This law introduced the right to claim compensation if court proceedings were excessively long. Compensation covers material disadvantages incurred and – if other forms of indemnification are insufficient in individual cases – also immaterial disadvantages.

Whoever as the result of the unreasonable length of a set of court proceedings experiences a disadvantage as a party in those proceedings shall be given reasonable compensation. The reasonableness of the length of proceedings shall be assessed in the light of the circumstances of the particular case concerned, in particular the complexity thereof, the importance of what was at stake in the case, and the conduct of the parties and of third persons therein.

A disadvantage not constituting a pecuniary disadvantage shall be presumed to have occurred in a case where a set of court proceedings has been of unreasonably long duration. Compensation can be claimed therefor only insofar as reparation by other means, having regard to the circumstances of the particular case, is not sufficient. Compensation shall amount to EUR 1,200 for every year of the delay. Where, having regard to the circumstances of the particular case, the sum is inequitable, the court can assess a higher or lower sum.

A party to the proceedings shall obtain compensation only if he has complained about the length of the proceedings to the court seized of the case (censure of delay). A censure of delay can be filed only if there is cause to fear that the case will not be concluded within a reasonable time. A censure of delay can be reiterated at the earliest after six months, but not in a case where a shorter duration is necessary by way of exception. Where expedition of the proceedings depends on factors that have not yet been introduced into the proceedings, reference shall be made thereto in the censure. Otherwise, in the assessment of the reasonable length of proceedings, account shall not be taken of these factors by the court required to give the decision on compensation (court of compensation). Where the proceedings are further delayed before another court, it shall be necessary to file a new censure of delay.