The implementation of dunning procedures offers creditors an efficient and cost-effective way of asserting claims. Below we look at the national procedures in Germany, Spain and Switzerland as well as at European level:
In Germany, a dunning procedure is possible for both domestic and cross-border monetary claims. An application for a payment order must be submitted for this purpose. After a formal examination of the application, the court issues the order for payment. The defendant can file an objection to this. If an objection is lodged, the proceedings will be transferred to contentious proceedings. If there is no objection, the creditor can apply for an enforcement order. This then forms the basis for enforcement. The advantage of this procedure is that the dunning court does not examine the content of the claim, which is why the procedure can be carried out faster and more cost-effectively than legal proceedings. At the same time, an application for a reminder suspends the limitation period. However, if the debtor raises an objection, the period of any subsequent civil proceedings is extended by the duration of the dunning procedure.
The cross-border order for payment procedure is similar to the domestic procedure, but there are a few special features, in particular the enforcement procedure for the order for payment is more complex. In this case, the German court first checks whether the order for payment can be declared enforceable. The competent foreign court must then be called in to decide whether the German declaration of enforceability should be extended to its own territory.
The Spanish order for payment procedure (Proceso monitorio) also requires an application to be made to the court first, but here the monetary claim must be supported by evidence. The court then decides whether to approve or reject the application. If the application is approved, the defendant has the option of lodging an objection. The procedure enables claims to be asserted quickly, regardless of the amount of the claim. However, if the defendant objects, the enforcement of the claim is delayed.
Switzerland also has a similar option for enforcing monetary claims in the form of debt enforcement and bankruptcy proceedings. Here, the procedure begins with the submission of a debt enforcement request to the debt enforcement office. The debt enforcement office sends the debtor a payment order requesting payment. The debtor can then lodge an objection. If he does so, this is followed by a lawsuit.
In addition to national procedures, there are also European options: The European order for payment procedure enables the simple and fast enforcement of cross-border monetary claims within the EU (except Denmark).
The application is made using a standard EU form. It is necessary to submit appropriate evidence. If the application requirements are met, the court issues an order for payment, against which the opposing party can lodge an objection. If an objection is lodged, the proceedings will continue before the competent national court. If no objection is lodged, the payment order is declared enforceable. This procedure is particularly advantageous because the payment order is enforceable in all EU member states (except Denmark) without any further formalities.
Furthermore, if the value of the claim is low, it is possible to initiate small claims proceedings. The procedure begins with the submission of a form including evidence to the competent court. The other party is then given the opportunity to respond to the application. The court then issues a judgment or summons to an oral hearing. This judgment is then enforceable throughout the EU (except Denmark). The advantage of this procedure is that both monetary and non-monetary claims can be enforced. However, this procedure does not apply to certain areas, e.g. in family law matters.
It is advisable to initiate dunning proceedings if the other party is not expected to contest the claim. However, even if an objection from the other party is expected, dunning proceedings may be advisable under certain circumstances. If you are unsure whether dunning proceedings are appropriate in your case or which procedure is best to use, we advise you to seek legal assistance in order to enforce your claims in the best possible way.
Author:
Dr. Dominic John Patrick Porta, LL.M.
Attorney at Law (Düsseldorf Bar Association n° 52954)
Abogado (ICAIB n° 6645)
dominic.porta@anwaltmallorca.eu
www.anwaltmallorca.eu
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