Recent developments in European Consumer Law. The ‘proceduralization’ of Directive 93/13 and its limits

The CJEU’s judgment in Banco Santander (C-598/15) that came out this week is the latest addition to a growing body of case law on procedural obstacles to consumer protection under Directive 93/13. The focus on procedures and the role of national (civil) courts in ensuring the effectiveness of the Directive, i.e. its ‘proceduralization’, has been the subject of debate between judges, legal practitioners and academics for a while now. It receives attention from the European Commission as well (see, e.g., the REFIT report of the European Commission, the RE-Jus project aimed at providing judicial training, and a much-anticipated study of the Max Planck Institute Luxembourg). However, Banco Santander reveals the limits of ‘proceduralization’ driven by preliminary references to the CJEU.
In this case, the referring Spanish court was confronted with a fait accompli, which made the judicial review of unfair contract terms impossible. It all started with a mortgage loan agreement between Banco Santander and Ms. Sánchez Lopez. The contract contained a clause – Clause 11 – by which Ms. Sánchez not only expressly agreed to enforcement through extrajudicial proceedings, but also authorised the bank to execute the sale of the mortgaged property on her behalf. Thus, the bank could represent Ms. Sánchez before the notary drawing up the sale instrument without her attendance. The bank had initiated (compulsary) mortgage enforcement proceedings, the property was acquired by the bank for 59.7% of the value, and the sale instrument had been entered into the land register, while Ms. Sánchez continued to owe the residual debt. At first, the bank had allowed her to stay on the premises as a tenant. Later, it brought a claim seeking an order for the eviction of Ms. Sánchez from the property.