This country-specific Q&A provides an overview of Litigation that may occur in Norway.
This Q&A is part of the global guide to Litigation. For a full list of jurisdictional Q&As visit http://www.inhouselawyer.co.uk/practice-areas/litigation-second-edition/
Published June 2019
What are the main methods of resolving commercial disputes in your jurisdiction?
Commercial disputes in Norway are solved mainly in the ordinary court system. In addition, arbitration and mediation are well-known alternatives that are also used to some extent.
What are the main procedural rules governing commercial litigation?
The primary act governing civil disputes, including commercial litigation, is the Norwegian Dispute Act. The Act sets out the steps through which the litigation process is carried out, including duties before commencing procedure, duties during preparation of the case and duties during the main hearing. Furthermore, it includes a section regarding the purpose of the Act, which is relevant when the Act is to be interpreted. The Act shall provide a basis for hearing civil disputes in a fair, sound, efficient and trustworthy manner through public proceedings before independent and impartial courts.
In cases where the parties have chosen arbitration in Norway, the Norwegian Arbitration Act applies. The Act is based on UNCITRAL Model Law on International Commercial Arbitration.
What is the structure and organisation of local courts dealing with commercial claims? What is the final court of appeal?
All commercial claims shall formally be claimed in the local conciliation board. However, disputes regarding claims over NOK 125 000 (≈11 000 GBP) where both parties have been assisted by lawyers, can instead be claimed in the district court, which is the typical procedure. In other words, district courts are de facto the main rule for commercial claims.
There are 60 district courts, and they handle all case types, except certain cases for which there is a mandatory legal venue. Practical exampels are IPR cases such as trademark cases, design cases and patent cases, all of which are handled solely by Oslo District Court. Decisions by the district court can be appealed to one of the six regional courts of appeal. The Supreme Court is the final court of appeal. However, before an appeal is allowed before the Supreme Court, the Supreme Court’s Appeals Committee must allow the appeal to enter the Supreme Court, which requires typically will only be given if the case raises questions of principle, that are relevant beyond the specific case.
How long does it typically take from commencing proceedings to get to trial?
According to The Norwegian Dispute Act, the main hearing is to be scheduled within six months after the date of submission of the writ of summons unless there are special circumstances. In practice, it will usually take longer than 6 months from commencing proceedings in commercial disputes to get to trial. However, the main hearing is rarely held more than one year after commencing proceedings.
Are hearings held in public and are documents filed at court available to the public? Are there any exceptions?
As a main rule, court hearings are public, but there are exceptions. Closing a hearing requires a formal decision by the court. Furthermore, documents relating to a proceeding are publicly available by request. This includes court records, court judgements and statements of costs. However, the initiating documents in a case are typically not public, except for the written closing submission. In commercial disputes, the most important exception from the main rule of publicity is probably the exception covering trade or business secrets.
What, if any, are the relevant limitation periods in your jurisdiction?
The limitation periods are regulated in the Norwegian Limitation Period for Claims Act, which states the general rule of limitation period for all claims. The general limitation period is three years. For some particular types of claims, e.g. recourse claims, the period diverges. The starting point for the period is the date on which the creditor first has the right to demand performance, or – if the claim arises from breach of contract - three years from the date when the breach of contract occurred. The period for tort claims commence when the creditor had or ought to have had sufficient information that proceedings could have been initiated. The most practical way to actively respect the deadline, is to initiate formal legal proceedings.
The Act also has provisions regarding delayed start of the limitation periods. For instance, if the creditor has not asserted the claim due to lack of knowledge about the claim’s existence or its debtor, the limitation period is one year after the date on which the creditor obtained or should have obtained such knowledge. However, regardless of “grace periods” effecting delayed start of the limitation period, the general limitation period of three years cannot be extended by more than a total of 10 years. For tort claims the period can extend for up to 20 years.
What, if any, are the pre-action conduct requirements in your jurisdiction and what, if any, are the consequences of non-compliance?
There are a few pre-action conducts that are required. A formal notice of commencement of lawsuit is necessary, and the notice shall mention the basis for the claim, as well as important evidence relating to the claim that the defendant must be presumed to be unaware of. The duty to disclose relevant evidence extends even to evidence that is detrimental to the party possessing the evidence. Non-compliance with the above requirements can, however, only affect the court’s decision on recovery of litigation costs.
How are commercial proceedings commenced? Is service necessary and, if so, is this done by the court (or its agent) or by the parties?
Proceedings are initiated by filing a writ of summons to the court. The writ of summons shall state the formalities regarding the parties, their representatives and counsel. In addition, it shall state the claim that is being asserted, the factual and legal grounds upon which the claim is based, the evidence that will be presented and finally the claim for relief (a statement of the outcome the plaintiff is requesting by way of judgment). The writ of summons shall also state the basis upon which the court has jurisdiction to hear the case, if this may be in doubt, and the plaintiff’s view on the further proceedings of the case.
If the writ is considered sufficiently detailed, the court will serve the summons to the defendant and order the defendant to file a written reply, normally within three weeks. If the defendant is represented by legal counsel, the writ of summons will be served digitally.
How does the court determine whether it has jurisdiction over a claim?
The court determines on its own accord (ex officio) whether it has jurisdiction. Normally this happens based on the written arguments from the parties in the preparatory phase, but the court can also determine jurisdiction as part of the main hearing in some cases where it is deemed more efficient.
How does the court determine what law will apply to the claims?
Choice of law in Norway is primarily based on non-statutory law. According to a precedent set by the Norwegian Supreme Court, the test is: Which state, on a global assessment of all relevant criteria, has the closest connection to the case? The tendency in the Norwegian Supreme Court today is to take into account the more precise criteria under EU-law as part of this global assessment. The Rome I Regulation is relevant for choice of law in contractual obligations, and Rome II Regulation is relevant for non-contractual obligations. Propositions regarding choice of law is currently on hearing in Norway, and the mentioned regulations from EU may be statutory in the near future.
In what circumstances, if any, can claims be disposed of without a full trial?
There are several ways in which a case may be disposed of without a full trial. There are various procedural impediments that can lead to a disposal that the court examines ex officio, e.g. whether it has jurisdiction and whether the plaintiff has a legal interest in the claim. Furthermore, a case can be disposed without a full trial if the parties reach a settlement, if the defendant concedes the claim, if the claim is manifestly unfounded or if the defendant is absent from the main hearing and the plaintiff has applied for a judgment in default. In the latter case, the judgment shall be based on the grounds for the claimant’s claim for relief, provided that the defendant has been notified of these and they do not appear to be clearly incorrect.
What, if any, are the main types of interim remedies available in your jurisdiction?
Two types of interim remedies exist: arrest, used to secure a pecuniary claim, and preliminary injunction, which is used to secure other types of claims and that typically will order the defendant to perform something or refrain from doing something. In both cases the plaintiff needs to establish that there is a need for such extraordinary measures, e.g. that the execution or enforcement of the claim would otherwise be considerably impeded.
After a claim has been commenced, what written documents must (or can) the parties submit and what is the usual timetable?
Firstly, you have the plaintiff’s writ of summons and the defendant’s reply, ref. question 8 above.
Once the statement of defence has been filed, the preparation of the case including the timetable for further written submissions is set by the court in consultation with the parties during a preparatory session. After this point there are no further mandatory written submissions, unless agreed otherwise in the preparatory session. However, in nearly all cases, a party will want to add further arguments or evidence to the case. This is done in written submissions on the party’s own initiative.
What, if any, are the rules for disclosure of documents? Are there any exceptions (e.g. on grounds of privilege, confidentiality or public interest)?
According to The Norwegian Dispute Act, each of the parties has a duty to provide the accounts and present the evidence which are necessary to ensure that the factual basis of the case is correctly and completely explained. Each party also has a duty to disclose the existence of important evidence that is not in his or her possession, if the party has no reason to believe that the opposite party is aware of the evidence. This applies irrespectively of which party such evidence favours. A party can also request for access to evidence, but the request needs to be specify in sufficient detail the item of evidence to which the application relates.
There are several exceptions from the duty to disclose evidence. In some cases, the evidence is banned from disclosure, e.g. evidence subject to a statutory duty of confidentiality. In other cases, the court can order disclosure even of trade or business secrets, if the court finds this to be necessary in order to obtain the relevant facts for its decision.
How is witness evidence dealt with in commercial litigation in your jurisdiction (and in particular, do witnesses give oral and/or written evidence and what, if any, are the rules on cross-examination)? Are depositions permitted?
With few exceptions, giving testimony, under oath and orally, is mandatory for anyone who is summoned as witness. Under certain conditions a testimony can be performed over video/telephone or as a pre-recorded examination (deposition). This is normally only allowed if a testimony at the main hearing is not possible or will be especially expensive or difficult in relation to the claim in dispute.
There are no special rules regulating cross-examination. However, the general prohibition against asking leading questions applies but can be accepted if it is done to test reliability of information that the witness has previously given.
Is expert evidence permitted and how is it dealt with? Is the expert appointed by the court or the parties and what duties do they owe?
Expert witnesses are permitted. They can either be appointed by the court or relied on as an expert witness by a party. Expert witnesses usually prepare and enclose a written report before the main hearing, and must give an oral testimony.
Can final and interim decisions be appealed? If so, to which court(s) and within what timescale?
All district court judgements can be appealed to the court of appeal. Judgements from the court of appeal can also be appealed to the Supreme Court, but it requires a special leave to appeal. Most interim decisions can be appealed. Generally, the time limit for appeal is one month.
What are the rules governing enforcement of foreign judgments in your jurisdiction?
The Lugano convention applies in Norway. According to the Convention, a judgment given in a state party to the European Union or the European Economic Area (EEA) shall be recognized in other EU- and EEA-states without any special procedure being required. With regards to other foreign judgments, the judgment will only be final and enforceable in Norway if the parties have agreed on the jurisdiction for a specific action or for actions that arise out of a particular circumstance.
Can the costs of litigation (e.g. court costs, as well as the parties’ costs of instructing lawyers, experts and other professionals) be recovered from the other side?
As a main rule the winning party can recover litigation costs from the other side. The court can make an exception from this if strong reasons indicate so, for example if there was justifiable cause to have the case heard, if a reasonable settlement offer has been rejected or if the case is important to the welfare of the party and the relative strength of the parties justifies an exemption.
Notwithstanding the result in the case, a party, including the losing party, can recover litigation costs if the case is brought without good reason, the case is dismissed for reasons beyond the control of the party and there is no doubt that the party would otherwise have succeeded, or to the extent the costs have arisen due to the opposite party’s omission or negligence.
What, if any, are the collective redress (e.g. class action) mechanisms in your jurisdiction?
Class actions can be heard before courts in Norway, but they are governed by special procedural rules and four conditions have to be met in order to bring a class action. First, several legal persons have to have claims or obligations for which the factual or legal basis is identical or substantially similar. Second, it is necessary that the claims can be heard by a court with the same composition and principally in accordance with the same procedural rules. Third, a class procedure must be considered as the most appropriate method of hearing the claims. Finally, the class must agree upon a class representative who will represent the rights and obligation of the class in the class actions. The action shall be brought by submission of a writ of summons to a district court before which a person who qualifies for class membership could have brought an ordinary action.
What, if any, are the mechanism for joining third parties to ongoing proceedings and/or consolidating two sets of proceedings in your jurisdiction?
Both the plaintiff and the defendant can bring new claims or claims against a third party during the proceedings. A requirement is that the court has jurisdiction for all the claims and that the same procedural rules apply. However, if this is to be done within 14 days of the commencement of the main hearing, stricter rules apply. Then either the other party must agree, or the court must give its consent.
Third parties can also intervene if Norwegian courts has jurisdiction and the third party has a separate claim regarding the subject matter of the case or that it is so closely linked with the subject matter that it should be dealt with in the same case. Additionally, third parties with a legal interest can intervene in favour of one of the parties without formally becoming a party if certain conditions are met.
Are third parties allowed to fund litigation? If so, are there any restrictions on this and can third party funders be made liable for the costs incurred by the other side?
Third parties can fund litigation, but unless they have declared a third-party intervention before the court, they cannot be held liable for the legal costs of action according to the procedural legislation. However, a third party may be obliged to compensate for some costs according to general tort law or according to a private agreement.
What is the main advantage and the main disadvantage of litigating international commercial disputes in your jurisdiction?
In contrast to many other court systems, Norway has courts that handle all subject matters in both civil and criminal law. This is a huge advantage in many cases, as it ensures judges that are highly qualified generalists. Whether the case requires specialized knowledge is always addressed in the consultation between the court and the parties immediately after the reply. In large and/or complicated commercial disputes, expert lay judges are common.
The main disadvantage of litigation disputes in Norway is the processing time. This has increased in the last couple of years, especially in the court of appeals. With appeals it can take a considerate amount of time to get a final judgement.
What is the most likely growth area for disputes in your jurisdiction for the next 5 years?
Claims regarding the EU General Data Protection Regulation (GDPR) and claims regarding intellectual property rights (IPR). Intellectual capital has emerged as the leading asset class in companies. Ocean Tomo has conducted a study which shows that while intangible assets constituted 17 % of the market value of S&P 50, it constituted 84 % in 2015. We have already seen a major increase in litigation related to intangible assets, including IPR, over the last couple of years, and we believe that this trend will continue.
Will be the impact of technology on commercial litigation in your jurisdiction in the next 5 years?
Technology has already had a large impact on litigation. Specifically, it has made the interaction between the court and the parties digital, and the hearings are now, for a large amount of the courts, based on digital documents. Implementing artificial intelligence (AI) more actively in both the legal research and in the courts are likely the next developments, but we do not expect to see this happening on a large scale over the next 5 years. Based on the fundamental due process requirements, AI is more likely to assist human judges than to replace them.