Beware - the European Order
As intra-community trade increases, so will contractual disputes which carry an international dimension. The prevalence of the "European order for payment" ("EOP") will undoubtedly increase. Introduced in December 2006 by the European Parliament, the procedure creates a method by which companies and individuals are able to seek an expeditious manner for securing payment of debts owed to them by third parties based in other EU member states (with the exception of Denmark).
Being the recipient of an EOP endorsed with the seal of the High
Court of Justice can be a rather unnerving experience, particularly
when one reads the key part that states:
"In accordance with Article 12 of Regulation (EC) No 1896/2006,
the court has issued this European order for payment on the basis
of the attached application. By virtue of this decision, you
are ordered to pay the claimant the following amount: "
The implication from this standard wording is that there has
been some judicial oversight, if you will, a consideration of the
merits. The Order, does, after all, say that a decision has
been made on the "attached application". Sadly, that
application is little more than a bare assertion of the sums said
to be outstanding and the parties concerned. However, the reality
is somewhat different. The Order is issued almost as a matter
of administrative exercise, subject to compliance with a few minor
formalities mainly as to form.
Upon receipt of an EOP, it is essential to consider whether it should be opposed and, if so, take immediate steps to do so; the deadline for opposing is 30 days from receipt of the EOP. If no statement of objection is lodged, the payment order becomes fully enforceable as a Judgment in Default granted by the High Court. It then becomes more difficult and a whole different ball game in terms of having it set aside and challenged. If a statement of objection is lodged with the issuing Court, then the matter becomes a normal claim that would be resisted with a Defence and/or Counter Claim in the usual way.
The important point to bear in mind is that the EOP is not, in the English sense of the word, a "proper" Court order to pay money, it is more of an invitation, which if not rejected, will lead to a formal Court order requiring the sum claimed be paid. Advice should be sought as early as practically possible, especially considering jurisdictional issues that may arise, which is a whole new set of issues to ponder over!
For more information about Higgs & Sons' Dispute Resoultion department please contact Craig Kelly on 01384 342100.
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