Case law

  • Case Details
    • National ID: Court of Appeal, Budapest, Judgment Pf.20220/2021/7 (ÍH 2021.125)
    • Member State: Hungary
    • Common Name:N/A
    • Decision type: Court decision in appeal
    • Decision date: 07/09/2021
    • Court: Fővárosi Ítélőtábla
    • Subject:
    • Plaintiff:
    • Defendant:
    • Keywords: transposition, national law, travel organizer, security
  • Directive Articles
    Package Travel Directive, Article 17 Consumer Rights Directive, Chapter 1, Article 1
  • Headnote

    D. 2015/2302 is not sufficiently transposed into Hungarian national law with regards to insolvency security. Consumers are not obliged to attempt damage mitigation during the insolvency proceedings of the travel organizer, as their damages directly arise from the insufficiency of the insolvency security fund.

  • Facts

    The plaintiff signed a travel contract with a travel organizer company. The plaintiff paid the full package price for the travel, but the travel organizer did not fulfill its obligations, became insolvent and did not pay back the plaintiff. The plaintiff entreated to the insolvency security provider of the travel organizer, but the provider only paid a fraction of the damages, due to the fund being insufficient for a full compensation. The plaintiff proceeded to sue the Hungarian Government for insufficient transposition of the 2015/2302 Directive.

  • Legal issue

    Whether the Hungarian Government sufficiently implemented D. 2015/2302 with regards to insolvency security?

  • Decision

    The court of appeal found that the government decree providing implementation of D. 2015/2302 did not sufficiently provide insolvency security, and as such, resulted in damages towards the plaintiff. It also highlighted that the respondent’s argument that the plaintiff did not attempt to mitigate damages by presenting themselves as a creditor in the insolvency proceedings of the travel organizer is without merit. This is because the purpose of the Directive, as per the Court of Appeal’s opinion, was precisely to ensure that the consumer does not need to engage in lengthy and uncertain insolvency proceedings to claim compensation for their damages. Given that the damages immediately arose from the insufficient compensation provided by the insolvency security fund, it was not necessary for the plaintiff to attempt mitigation during the insolvency process. Furthermore, it also stated that it is not necessary to request preliminary ruling from the ECJ in a situation where both EU law and transposing law changes, if a previous interpretation was already obtained and the substantive meaning of the EU law remains identical.

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  • Result

    The court of appeal sustained the judgment of the court of first instance, expanding only its reasoning.