FAQ – Answers to frequently asked questions Below are the answers to frequently asked questions on legal issues:
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How can I know in advance if a customer is willing to
pay?
Who bears the costs for legal proceedings?
Does legal defence insurance pay the costs for legal
proceedings and compulsory enforcement?
How can a creditor who does not live in Germany issue a
court order against a German debtor?
Who bears the costs for legal proceedings if the debtor
settles the claim before the court order has
been delivered but after it has
been issued?
Is there a minimum claim amount for issuing a court
order?
What kind of claims can be issued in the legal
proceedings?
Answers to technical questions:
|
| What can I do when goods I purchased are not delivered although I transferred the money? |
|
Your situation: You have transferred payment for goods, but the goods have
not been delivered. This is unfortunately sometimes the case with internet
auctions.
Contact the seller and instruct him or her to deliver the goods and set a time limit. Otherwise instruct the seller to refund your money once your deadline has passed. It is important that you explicitly request a refund of your money if the goods are not delivered. In addition, by setting a deadline, the seller will be in default. If the seller does not react to your request, you have the choice to either send a second request to the seller or to issue a court order. |
| What should bills and reminders look like? |
In designing
your bills and reminders, please keep the following points in mind:
Always send the reminder letter promptly upon expiration of the final deadline. |
| Is a court order effective if my claim is only 15 € ? |
|
If you retain an
attorney to collect the debts in this case, the costs for the legal dunning
procedure will be higher than the amount of the claim. Often however, the
debtor’s consideration of increased costs which arise from not paying
eventually will make the debtor settle the claim.
You should also consider that the debtor may believe that no legal action will be taken to settle the claim because of the claim’s low amount. Internet businesses in particular should keep in mind in certain debtor circles, word spreads that internet-based service providers do not prosecute debtors who are unwilling to pay. The result is that the number of unpaid claims will increase. |
| Is a second reminder effective? |
| This is hard to answer in general. Ascertain whether the debtor usually ignores second reminders. If this is normally the case, then the efforts and costs of additional reminders are not efficient. Consider: sending prompt reminders and a first reminder should be sufficient before taking legal action. |
| How can I know in advance if a customer is willing to pay? |
|
There are certain databases available on the internet which list debtors who are known to be insolvent or unwilling to pay. Use these databases to check the payment trend of customers before engaging in business with them. For example, Supercheck is a community for internet-based service providers. Members can make an inquiry and add the names of insolvent customers or those unwilling to pay. |
| Who bears the costs for legal proceedings? |
|
Generally the
debtor pays the costs of the legal procedure. Certain conditions must be fulfilled: - the creditor’s claim is valid - the debtor is in default of payment If one of the two conditions is not fulfilled and if the debtor does not want to settle the claim, then the costs of the proceedings must be paid by the creditor. If both of these conditions are fulfilled but the debtor is insolvent, the debtor will legally be obligated to pay the costs of the proceedings but financially unable to bear these costs. In this case, the costs of the proceedings must be paid initially by the creditor. As soon as the debtor is able to pay the costs, he or she is obligated to do so. If an enforcement order has been issued, it is possible to proceed against the debtor within 30 years by means of enforcement measures to recover the costs of the proceeding and the claim. It is thus possible to wait before starting enforcement measures until the debtor is able to pay. Until a claim has been settled or recovered in the scope of a compulsory enforcement, the interest on the claims continues to accumulate. Thus, there is interest paid on the claim based on the rate of interest given in the dunning procedure. |
| Does legal defence insurance pay the costs for legal proceedings and compulsory enforcement? |
|
If the dunning
proceedings involve objections by the debtor, legal defence insurance will
not pay all costs. This is because there is no “real” lawsuit concerning the
claim that must be recovered.
If the debtor is insolvent, in default of payment and if the claim is justified, the debtor must pay all costs of the dunning procedure and the compulsory enforcement, if necessary. In this case, legal defence insurance is not necessary. If it is not possible to recover the claim because the debtor is not liquid at this point of time, the defence insurance will not pay the costs of the dunning procedure. This is because the creditor issued an enforcement title at the end of the dunning procedure. This title gives the creditor the right to recover outstanding claims and additional costs that arise for the dunning procedure over the next 30 years by means of enforcement measures. In contrast, the costs of up to three attempts to gain payment based on the enforcement order issued during the dunning procedure are accepted by defence insurance. If the debtor files an objection, the court will decide whether the claim
is justified or not. The defence insurance will pay if it grants legal
protection of the issue forming the basis of the claim. |
| How can a creditor who does not live in Germany issue a court order against a German debtor? |
|
Businesses or
private persons who have residence abroad (regardless if they are German
businesses or German citizens) are able to issue court order against a
German debtor. Those procedures are dealt with by the court responsible for
dunning in Berlin.
The legal and compulsory enforcement proceedings do not differ from procedures that are valid for people or businesses residing in Germany. |
| Who bears the costs for legal proceedings if the debtor settles the claim before the court order has been delivered but after it has been issued? |
| If the debtor remains in
default of payment at the point of time when the court order is issued or
third party is assigned to deliver the court order, the debtor must pay
even if the debtor settles the claim after the court order has been issued
but before it could be delivered.
Thus the debtor must pay the costs of legal proceedings even if he or she did not know about the court order at the time of claim settlement since the court order had not yet been delivered. |
| Is there a minimum claim amount for issuing a court order? |
|
No, there are no minimum or maximum claim amounts. Theoretically it is possible to claim 1 cent or € 1 billion.
On whether it is effective to recover low amounts, please see: |
| What kinds of claims can be issued in the legal proceedings? |
| It is only possible to make
monetary claims, not claims for restitution of physical objects (e.g.
non-delivered goods).
If goods have not been delivered, it is possible to claim the amount of money paid. Before taking legal action, please inform the debtor that you are no longer interested in the goods and that you request a refund of your money by a certain deadline. If the debtor does not pay by the deadline, you may proceed with legal action. |
All
information is presented to the best of our knowledge. We assume no
responsibility for its correctness. |