Case law

  • Case Details
    • National ID: адм.д. 7185/2013
    • Member State: Bulgaria
    • Common Name:link
    • Decision type: Supreme court decision
    • Decision date: 12/11/2013
    • Court: Supreme Administrative Court
    • Subject:
    • Plaintiff: Bulgarian Consumer Protection Commission
    • Defendant: Germanos Telecom - Bulgaria EAD
    • Keywords: commercial guarantee, conformity with the contract, consumer, consumer goods, sales contract
  • Directive Articles
    Consumer Sales and Guarantees Directive, Article 1, 2., (a) Consumer Sales and Guarantees Directive, Article 1, 2., (b) Consumer Sales and Guarantees Directive, Article 3, 1. Consumer Sales and Guarantees Directive, Article 3, 2. Consumer Sales and Guarantees Directive, Article 3, 3. Consumer Sales and Guarantees Directive, Article 3, 4. Consumer Sales and Guarantees Directive, Article 3, 5. Consumer Sales and Guarantees Directive, Article 3, 6. Consumer Sales and Guarantees Directive, Article 6 , 1.
  • Headnote
    1) The fact that a seller and a consumer concluded a lease agreement, instead of a sale agreement, does not alter in any way the quality and purpose of the goods subject of the lease agreement as consumer goods.
    2) When the producer or the seller has provided commercial guarantee on the goods and satisfying the claim is made by replacement of the goods with other which is in conformity with the contract, the seller is obliged to keep the consumer's rights under the original commercial guarantee. In this case both the producer and the seller are liable under the commercial guarantee.
  • Facts
    At a shop operated by the defendant and located in the town of Yambol an individual (the consumer) entered into a lease agreement with Cosmo Bulgaria Mobile EAD for the lease of a mobile phone device with an option to purchase. Consequently the consumer placed several claims with the defendant on the nonconformity of the mobile phone device with agreement. Despite the attempts for removing the nonconformity, the device kept showing defects. Therefore, the consumer submitted a request to the plaintiff asking for assistance with removal of the nonconformity.
    The plaintiff granted the consumer’s request and issued mandatory instructions to the defendant. Pursuant to said instructions the defendant must replace the defective mobile phone device with a new one that conforms to the lease agreement.
    The defendant challenged the mandatory instructions with the Bourgas Administrative Court and the court awarded the defendant’s appeal and repealed the mandatory instructions of the plaintiff. The plaintiff appealed the first instance court’s judgment to the Supreme Administrative Court.
  • Legal issue
    1) The nature of the agreement – a lease or sale agreement, does not prevail in determining whether the particular product is a consumer good or not. It is not the title over the good that matters but its purpose and intended use – to be used for satisfaction of the consumer’s personal needs, and the quality of the consumer – being a natural person.
    2) In the case at hand there is a clear designation of the parties: Cosmo Bulgaria Mobile EAD is the lessor, the consumer is the lessee and the defendant is the entity to whom the obligations under the commercial guarantee were assigned. The lease agreement is not a financial lease but it contains option to purchase the leased mobile phone device. The defendant agreed to undertake on behalf of Cosmo Bulgaria Mobile EAD a commercial guarantee liability and must satisfy the consumer’s claims based on the same guarantee. The manner in which the defendant and Cosmo Bulgaria Mobile EAD will settle their relationships after the satisfaction of the consumer’s claim is irrelevant to the case at hand.
  • Decision

    1) Does the fact that a seller and a consumer concluded a lease agreement, instead of a sale agreement alter in any way the quality and purpose of the goods subject of the lease agreement as consumer goods?
    2) In case the producer or the seller has provided commercial guarantee on the goods entitling the consumer to replacement of the non-conforming goods, is the seller obliged to keep the consumer’s rights under the original commercial guarantee and who is liable under that commercial guarantee – the producer or the seller or both?

    URL: http://www.sac.government.bg/court22.nsf/d038edcf49190344c2256b7600367606/80d0329632740c32c2257c1c004af5c8?OpenDocument

    Full text: Full text

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  • Result
    The court repealed the first instance court’s judgment and awarded the plaintiff’s appeal.