THE IMPLICATION OF THE SUPREME AND CONSTITUTIONAL COURTS IN THE IMPLEMENTATION OF THE DIRECTIVE. PARTICULAR ATTENTION TO THE

PRINCIPLES OF RES JUDICATA AND REFORMATIO IN PEJUS. THE ACCUMULATION OF CONSUMER DISPUTES.

The proliferation of litigation related to unfair terms in Spain can undoubtedly be attributed not only to the clarification by the CJEU of the interpretation of Directive 93/13, but also to bad banking practices. It is very likely that - after thirty years of the Unfair Terms Directive being in force - the situation will start to improve. Let us hope that so much effort - in which the Supreme and Constitutional Courts have also taken an active part - has not been in vain.

It is normal that this multitude of proceedings, some concluded, others pending resolution, has opened up a debate on the effectiveness of res judicata, or rather on how to define more precisely the operability of this key principle of procedural law. And this has been the case, not only at the doctrinal level but also in the jurisdictional sphere, a debate in which our High Courts, the Supreme and Constitutional Courts and the CJEU are involved, as I will explain below.

In relation to res judicata, it is undoubtedly worth highlighting the accumulated preliminary questions that - on the occasion of the Supreme Court's doctrine on the nullity of floor clauses[28], but limiting in time the effects of the ineffectiveness[29]- were brought before the CJEU, giving rise to the Gutiérrez Naranjo judgment[30]: In it, the CJEU left the doctrine of the limitation of the effects of the nullity of the floor clauses decreed by the Supreme Court without application, while declaring that EU law does not oblige national judges to stop

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applying domestic procedural rules that confer the effects of res judicata[31], a pronouncement that generated "a great storm"[32].

At the same time, the effort that the Spanish legislator had made after the Aziz case to adapt domestic law to Directive 93/13, although it was rapid, as we have seen, came up against a new declaration of incompatibility with Directive 93/13 (BBVA case[33]): The CJEU declared that the Fourth Transitional Provision of Law 1/2013, by giving a period of one month in which - in proceedings already initiated - the unfairness of the clauses could be invoked, without providing for the notification of this possibility to the consumers affected, did not guarantee the effective exercise of the new right recognised to consumers by the legislative amendment[34]. Logically, consumers began to object on the grounds of unfair terms, irrespective of the date on which the procedure was initiated.

In order to unblock the situation of the return of amounts generated for these reasons, Royal Decree-Law 1/2017, of 20 January, on Urgent Measures for the Protection of Consumers in relation to floor clauses, was approved, establishing a system for the extrajudicial resolution of conflicts; In addition, the Judiciary launched a plan for the specialisation of courts in abusive clauses, a solution that - over the years - has achieved very positive results[35] ; Finally, the Draft Law on Procedural Efficiency of the Public Service of Justice (2022)[36] provides for the so-called "witness procedure", which has not yet been implemented in the LEC[37], in order to solve the saturation of Courts and Tribunals in matters such as those involving massively defrauded consumers (e.g. preference shares or floor clauses).

Now then: If - as we have just explained - the cited judgment of the CJEU in the Gutiérrez Naranjo case declared it legitimate for a national judge to place a limit on consumer protection in the presence of res judicata, and affirmed the compatibility between this national procedural principle and Directive 93/13/EEC, the issue in Spain has not remained there, and - as we will see below - it has been precisely the Constitutional Court who has taken a step forward by restricting the cases in which res judicata can act as a limit to consumer protection (STC 31/2019, of 28 February).

Shortly before the Constitutional Court ruling just mentioned, Josep Mª Bech Serrat had questioned whether the principle of effective protection, as well as the principles of equivalence and effectiveness, would not justify, in some cases, making an exception to res iudicata to give priority to the application of EU law, also when there is res judicata[38] ; The author alluded, in the matter of unfair terms, to the CJEU ruling of 26 January 2017, in the so-called Banco Primus case (ECLI:EU:C:2017:60). In this judgment, the CJEU stated that for a decision to have the effects of res judicata and not be reviewable in relation to a specific term, it must contain sufficient reasoning to consider that there was an ex officio review of the legality of the contract as a whole; however, in the event that a term had not been examined in a previous judicial review concluded with the effects of res judicata, the judge would be obliged to assess the nullity, either ex officio or at the request of a party[39] .

In the aforementioned judgment of 28 February 2019, the Spanish Constitutional Court echoed the doctrine of the CJEU, established in the Banco Primus case[40] , but went a step further by

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demanding that - in order to speak of res judicata - there must be a reasoning in a prior final decision on the specific unfair term in question (a judgment on the legality of the contract in general would not therefore be sufficient): In this case, the TC assumes the obligation to provide effective judicial protection, as the other judicial bodies have not done so, and declares that the failure of the latter to comply with the obligation to assess the unfairness of a contractual clause justifies the granting of constitutional protection to the consumer, citing articles 24, 47 and 51 Spanish Constitution.

Mª José García-Valdecasas makes two interesting considerations in this respect[41]: On the one hand, she recalls that in Banco Primus, the CJEU considered the existence of a judicial pronouncement on the legality of the contract as a whole to be sufficient for there to be res judicata, while the Spanish Constitutional Court, in its judgment of 28 February 2019, "goes further and requires additional motivation" by stating that the right to effective judicial protection is violated if there is no pronouncement on the possible unfairness of the clause that caused the execution. In the author's opinion, "this requirement of express motivation, in relation to the disputed clause, is a requirement of a procedural nature, and, therefore, whether or not it is required in the national sphere is perfectly possible" if the principles of equivalence and effectiveness are respected[42]. The Spanish Constitucional Court (TC) has reiterated its doctrine: Thus, in STC 44/2022, of 21 March 2022[43] and in STC 80/2022, of 27 June 2022[44] .

Returning to the commentary of the author cited above, she notes that the Constitutional Court indicates as the only limit to the control of the unfairness of contractual terms, the existence of res judicata in relation to the specific unfair term, "without it appearing to be deduced from the judgment of the Court of Justice that res judicata constitutes the only exception to the examination of the unfairness of a contractual term"[45] . The existence of a third party successful tenderer may also constitute a limit to the effects of the nullity of the unfair term and thus to the protection of the consumer at the end of the enforcement procedure[46] . Finally, the Spanish Supreme Court (SC) has sought to take a step forward by raising before the CJEU the compatibility between a series of procedural principles and Article 6 of Directive 93/13/EEC, on the occasion of a dispute arising from the above (doctrine on floor clauses and retroactivity in time). The response of the CJEU to the Supreme Court, in the judgment of 17 May 2022[47], while reiterating the compatibility of the principle of res judicata with the aforementioned rule and affirming that consumer protection is not absolute, qualifies that "the fact that a consumer has not lodged an appeal in due time can be attributed to the fact that, when the Court of Justice delivered the judgment of 21 December 2016, Gutiérrez Naranjo and Others (C154/15‑, C307/15 ‑and C308/15‑, EU:C:2016:980), the time-limit within which an appeal could be brought or the judgment could be challenged under national law had already expired. In those circumstances, the consumer cannot be regarded as having shown total passivity".

The fact is that - in the case that gave rise to the CJEU judgment of 17 May 2022 - it was the bank and not the consumer who had appealed, and therefore, the judicial assessment of the unfairness of the term clashed head-on with the prohibition of reformatio in peius, as well as

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with other related procedural principles (the principles of the principle of prompt justice and of congruence, as well as the principle of tantum apellatium quantum devolutum). For this reason, the Supreme Court had to ask the CJEU for a preliminary ruling, in order to obtain an answer as to whether the principle of effectiveness imposed consumer protection in the presence of an unfair term, even in such circumstances, or whether the classic procedural principles of national law (Article 267 TFEU) should be applied.

The CJEU answered the SC's question by arguing that Article 6 of Directive 93/13/EEC 'precludes the application of national procedural principles under which a national court hearing an appeal against a judgment limiting in time the restitution of sums unduly paid by the consumer as a result of a term declared unfair cannot examine of its own motion a plea alleging infringement of that provision'. Consequently, instead of applying the abovementioned procedural principles (in particular the prohibition of reformatio in pejus), "full restitution of those sums must be ordered where the failure of the consumer concerned to challenge such a limitation in time cannot be attributed to total passivity on his part".

In a masterful analysis of the case, the proceduralist Juan Damián Moreno has presented a perspective on how the system works, which is of interest not only to civil and procedural lawyers but also to those involved in constitutional and European law[48].

VII. THE NEED TO SYSTEMATISE EUROPEAN CONSUMER PROCEDURAL LAW