ECJ: Árpád Kásler and Hajnalka Káslerné Rábai v OTP Jelzálogbank Zrt

The judgment in this case, which concerned Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts, has been published. In 2008, the plaintiffs concluded a contract for a mortgage denominated in Swiss francs with a Hungarian bank. The contract stipulated that the fixing in Swiss francs of the amount of the loan was to be made on the basis of the buying rate of exchange of that currency applied by the bank on the day the funds were advanced. However, under the contract, the amount in Hungarian forints of each monthly instalment to be paid was to be determined, on the day before the due-date, on the basis of the rate of exchange applied by the bank to the sale of Swiss francs. The plaintiffs brought an action in the Hungarian courts with regard to this which ended in the country’s Supreme Court (the Kuria) asking ECJ, amongst other matters, whether the contract could continue in existence if the term alleged to be unfair was deleted and whether the national court is authorised to amend or supplement the contract. ECJ ruled that, if the deletion of an unfair term renders the contract unenforceable, the Directive does not preclude the national court from substituting the contested term with a supplementary provision of national law.