Romania: Litigation (2nd Edition)

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This country-specific Q&A provides an overview of Litigation that may occur in Romania.

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

  1. What are the main methods of resolving commercial disputes in your jurisdiction?

    In Romania, commercial disputes are mostly settled through litigation before the competent courts. During the last years, arbitration has started to be more frequently used for resolving commercial disputes, especially the most complex ones. The Romanian arbitration procedural rules qualify arbitration as ADR, this rules being broadly based on the UNCITRAL Model Law on International Commercial Arbitration 1985. The arbitration proceedings are constantly increasing and almost all commercial contracts of high value contain arbitration clauses.

    There is also an alternative mechanism, consisting in mediation, but it is rarely used.

  2. What are the main procedural rules governing commercial litigation?

    Commercial litigation is not defined or regulated per se by the Romanian legislation. As a consequence, the general procedural rules (the Romanian Civil Procedure Code) are applicable. An important law containing procedural rules is represented by the Law no. 85/2014 on the proceedings regarding the prevention of insolvency and on insolvency, being of particular interest in the field of Commercial law.

    The main stages of litigation are: (i) the written phase, which consist in the submission of the statement of claims by the claimant, the submission of the statement of defence by the defendant and the submission of the response to the statement of defence by the defendant; (ii) the establishing of the facts of the case, by introducing the evidence; (iii) the debates, where each party exposes its arguments to the Court; (iv) the deliberation of the Court followed by the rendering of the judgement; (v) the appeal and/or the appeal for review, depending on the nature of the case.

                                                                                                                                                                                                                                                                                                                                                                    

  3. What is the structure and organisation of local courts dealing with commercial claims? What is the final court of appeal?

    Large commercial disputes, though not defined by the as a specific type of litigation, are usually brought to Tribunals as first instance courts. The Tribunals are organised at a county level and in the Bucharest municipality. For a case to be allocated to a tribunal in the first degree of jurisdiction, its object must be of a value that exceeds RON 200.000 (approximately EUR 43,000).

    The Tribunals are organised in specialised divisions, dealing with civil, commercial, criminal, labour or administrative matters. Currently there also exist three specialised commercial Tribunals, which have material jurisdiction over cases regarding Commercial and Insolvency Law.

    The Tribunals’ judgements can be appealed. The appeal shall be judged by the competent Court of Appeal, whose decision may be the object of an appeal for review before the High Court of Cassation and Justice.

  4. How long does it typically take from commencing proceedings to get to trial?

    The Romanian law provides that the trial is started through submitting the statement of claims to the court by the claimant. Afterwards, a series of administrative matters are resolved by the Court, such as the random designation of a judge, who will conduct a regularization procedure. The object of this procedure is represented by verifying that the statement of claims meets all the formal prerequisites.

    Once this stage is finalized, the Court shall proceed to conveying the statement of claims to the defendant, which has 25 days to submit his statement of defense. In 10 days after receiving the statement of defense, the claimant must submit its response.

    After the completion of this stage, the judge establishes the date of the first court hearing, which is usually after several months from the moment when the statement of claims was submitted.

  5. Are hearings held in public and are documents filed at court available to the public? Are there any exceptions?

    As a rule, according to the Civil Procedure Code, all court proceedings are public. However, the law also provides several exceptions. The judge, either ex officio or at the request of the parties, in case the morality, public order, privacy or justice interests impose it, may declare the hearings confidential.

    Parties and their representatives have unrestricted access to the case file. Altogether, with the prior approval of the court, the documents contained in the court files can also be accessed by any interested person or journalists, on condition that they justify an interest in accessing the information.

  6. What, if any, are the relevant limitation periods in your jurisdiction?

    The normal limitation period for an action for breach of contract or in tort is three years from the date when the cause of action accrued, this representing the standard limitation period in bringing up a claim.

    In contract law, the limitation period starts from the date of the breach. In cases of misrepresentation or mistake on the conclusion of a deed, the limitation period of three years for the right to request cancellation of the deed does not start until the claimant or its representative has discovered the grounds for cancellation (but no later than 18 months from signing the challenged deed).

    In tort law, the limitation is usually triggered from when the party knew, or should have known, both that the damage occurred and the identity of the person who caused it.

    In principle, claims in relation to immovable property (restitution claims of lands or buildings) are not subject to any statute of limitations, the rightful owner being entitled to claim the property at any time.

  7. What, if any, are the pre-action conduct requirements in your jurisdiction and what, if any, are the consequences of non-compliance?

    In Contract law, the usual pre-action conduct requirement consists in communicating the notice of default to the party that has breached the contract.

    In case of non-compliance, from the date when the statement of claims is communicated to the defendant, it has a reasonable term for executing the contract. In case the obligation is executed within this term, the claimant will not be able to obtain reparation for the costs of the trial.

  8. How are commercial proceedings commenced? Is service necessary and, if so, is this done by the court (or its agent) or by the parties?

    Commercial proceedings commence with submitting the statement of claims to the Court. The court has to obligation to communicate the procedural acts to the parties and to notify the dates of the court hearings.

    Communications are usually sent via ordinary mail/postal service in a closed envelope with a confirmation of receipt. The court can use its own procedural agents. There are alternatives to the ordinary mail, such as fax, email or any other mean of communication with confirmation of receipt.

    However, the court cannot rule on a claim if the parties were not legally summoned. These summonses are issued by the judge’s order, any irregularity concerning them, including irregular communication, represents a ground for annulment of the judgement.

  9. How does the court determine whether it has jurisdiction over a claim?

    The courts have the obligation to verify ex officio their jurisdiction at the first court hearing. A first criteria is represented by the geographical area, the general rule for filing a claim is that the jurisdiction belongs to the court where the defendant is domiciled.

    The court will also verify its material jurisdiction, one of the most important criteria being represented by the value of the claim’s object. For a case to be allocated to a tribunal in the first degree of jurisdiction, it must be of a value that exceeds RON 200.000 (approximately EUR 43,000). Therefore, if a Courthouse is invested with a claim that exceeds the capped value, the jurisdiction will be declined in the favour of the Tribunal.

    Therefore, the court determines its jurisdiction by applying the procedural rules in this matter. In case of conflict of competence, the superior court will decide.

    However, in some cases, the parties may expressly agree on the jurisdiction. When this agreement complies with the provisions of the law, the court cannot decline its jurisdiction.

  10. How does the court determine what law will apply to the claims?

    According to the procedural rules, the parties establish the limits of the trial, both with respect to the facts and to the applicable law. However, based on its active role, the judge may qualify a claim and to determine its applicable law. Altogether, the judge is obliged to protect the public order. as the judge has the main role in establishing the truth. As a limitation, the judge cannot determine the applicable law by himself if the parties have expressly agreed the legal ground for it, but without bringing prejudice to other people’s rights.

  11. In what circumstances, if any, can claims be disposed of without a full trial?

    The defendant can raise, by way of motions several defences in order to obtain the dismissal of a claim before the full trial:

    • Claimant’s failure to pay the requisite stamp fee (judicial fee);
    • Claimant’s failure to prove that it has duly empowered the signatory of the statement of claim to start the legal action;
    • The same claim has been already irrevocably settled by a court of law (res judicata authority);
    • Claimant’s failure to comply with the limitation period;
    • Lack of general jurisdiction of the courts to adjudicate the matter, or lack of jurisdiction of the Romanian courts (in international litigation) to adjudicate a specific claim.
  12. What, if any, are the main types of interim remedies available in your jurisdiction?

    The main types of interim remedies are represented by: (i) interim seizure, which consists in freezing the movable/immovable assets of the debtor; (ii) interim attachment; (iii) applications for the preservation or detention of property.

    Altogether, there is the possibility to apply for a presidential ordinance in order to obtain an interim measure.

  13. After a claim has been commenced, what written documents must (or can) the parties submit and what is the usual timetable?

    The claim is served to the defendant by the court. The defendant must submit his statement of defence within 25 days after the receipt of the claim, submitting this statement being mandatory.

    The claimant can also to submit the response to the statement of defence within 10 days after the receipt of the statement of defence.

  14. What, if any, are the rules for disclosure of documents? Are there any exceptions (e.g. on grounds of privilege, confidentiality or public interest)?

    During the civil trial, the parties are under the obligation to prove their demands, the most common evidence being represented by documents. As a consequence, the parties must identify and locate all potentially documents. They must submit to the court all the documents in their possession that are intended to be used as evidence.

    When the document supporting one of the parties is in the possession of the opponent or other person, the interested party may formulate a request of disclosure in front of the judge. The judge cannot dismiss the request when the document is common to the parties, when the document was mentioned by the party which possess it or when, by law, the other party is obliged to disclose the document.

    The request may be dismissed in case the document is related to entirely personal matters, in case its disclosure would constitute a violation of the professional secret or in case the document potentially incurs criminal liability. Anyhow, the document must be presented to the judge, who shall decide whether the previous hypothesis is applicable.

    In case the document is in the possession of a public authority, institution, party or other person who refuses to present it within the period of time granted by the court, the sanction consists in a judicial fine of 50 to 700 RON.

    There are exceptions of the duty to disclose the documents on terms of privilege, confidentiality or public interest.

    In case the document is in the custody of a public institution or authority, the court may issue a request to disclose the document. This request may be denied only for reasons related to national security, public security or diplomatic relations.

    Moreover, communications between a party and its legal advisers in which the party is seeking or obtaining legal advice are always privileged, except when there is data suggesting the lawyer is committing or preparing to commit certain crimes named by the law.

  15. 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?

    Witnesses testify orally before the court, without reading a previously written response. With the permission of the judge, the witness may use documents only for specifying numbers or names.

    Witnesses can be cross-examined at trial, in the establishment of facts stage of the trial. After the hearing of the witness, the parties may ask questions, not directly, but by referring their queries to the judge, who then questions the witness.

    A witness deposition is recorded in writing and signed by the witness. Written depositions submitted to the court instead of oral testimony do not have evidentiary value.

  16. 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?

    Final decisions can be appealed by way of extraordinary appeal mechanism such as the appeal for annulment of the decision, within 15 days after the receipt of the final decision, no more than a year after the decision became final. Another extraordinary way of appeal is the revision of the decision, when the party must submit it within one month, up to 6 months after the receipt of the final decision.

    The court that has rendered the final decision usually has jurisdiction over the extraordinary appeals.

    All interim orders, except those rendered by a court of appeal, are always appealable. Interim orders rendered by a court of appeal may be object of an appeal for review (recourse). The appeal or appeal for review shall be judged on an expedited basis and with notice.

  17. Can final and interim decisions be appealed? If so, to which court(s) and within what timescale?

    Foreign judgments rendered by courts in states that are not EU members can be enforced in Romania by a special recognition and enforcement procedure implying a local claim with this object. Throughout this procedure, the Romanian court is not allowed to re-examine the case on the merits, but it can refuse to enforce the judgment if the judgment is contrary to Romanian public policy. Other formal requirements are also requested, such as providing the original foreign judgment apostilled or legalised by the competent foreign authority, as well as proof that the foreign judgment is final and enforceable in the country of origin. It is prohibited to enforce judgements regarding interim attachment orders and judgements temporarily enforceable.

    Foreign judgments made by courts of law in the EU are enforced in Romania under the Brussels Regulation. Moreover, the 2007 Lugano Convention and the Hague Convention on Choice of Court Agreements are also applicable in Romania. The party seeking enforcement of the judgment must file an application before the tribunal which has under its jurisdiction the place where the enforcement is to take place.

  18. What are the rules governing enforcement of foreign judgments in your jurisdiction?

    The general principle is that the unsuccessful party must reimburse the successful party’s costs, upon that party’s request. The amount of the costs is based on evidence of due payment submitted by the party as far as court fees, legal fees, expert fees, witness expenses, translation costs are concerned.

    However, if the claim is admitted only in part, or if a counterclaim is also admitted, the costs of the parties are subject to set-off as determined by the court.

    The court can decide to decrease legal fees if it considers them unreasonable, in relation to the value of the case and services rendered. The court cannot challenge the amount of the court fees and other procedural taxes, experts’ fees, witness disbursements and other costs that the successful party proves to have incurred.

  19. 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?

    The general principle is that the unsuccessful party must reimburse the successful party’s costs, upon that party’s request. The amount of the costs is based on evidence of due payment submitted by the party as far as court fees, legal fees, expert fees, witness expenses, translation costs are concerned.

    However, if the claim is admitted only in part, or if a counterclaim is also admitted, the costs of the parties are subject to set-off as determined by the court.

    The court can decide to decrease legal fees if it considers them unreasonable, in relation to the value of the case and services rendered. The court cannot challenge the amount of the court fees and other procedural taxes, experts’ fees, witness disbursements and other costs that the successful party proves to have incurred.

  20. What, if any, are the collective redress (e.g. class action) mechanisms in your jurisdiction?

    Romanian law does not recognise typical collective redress mechanisms as the United States has, for example. However, the Romanian procedural rules contain particular provisions that relate to cases involving multiple parties, when the parties are under the obligation to appoint one or more representatives, or the representatives must be appointed by the court.

  21. What, if any, are the mechanism for joining third parties to ongoing proceedings and/or consolidating two sets of proceedings in your jurisdiction?

    Third parties may join the ongoing proceedings as long as they have an interest in the case. The third party may intervene for himself, when he claims the same rights as the claimant in the first place, or he can support another party’s defence, this intervention being ancillary to the main proceedings.

    The intervention must respect the formalities required when submitting a claim and can be submitted only in front of the first instance court or in front of the appeal court only with the approval of the parties.

    Two proceedings may be reunited into one, in the interest of justice, when they both involve at least one of the parties and theirs object and cause are linked.

  22. 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?

    Litigation funding by a third party is not officially provided for within the Civil Procedure Code, therefore, third-party funding of the proceedings is permitted. The third-party funding will be governed by the agreement concluded between the funder and the beneficiary. It is debatable if the third party will be able to recover his expenses, unless he has a convention in that respect. However, third-party funding is not frequently used in Romania.

  23. What is the main advantage and the main disadvantage of litigating international commercial disputes in your jurisdiction?

    The main advantage may be the low value of the stamp fee, in comparison with other countries, calculated in accordance with the value of the claim. For example, for a claim valued over 50.000 EUR, the value of the stamp fee will represent 1% of the value plus 1500 EUR. Also, there is the possibility for instalment, therefore, if the stamp fee is of high value, it can be paid in successive months.

    The main disadvantage would be the time periods for the hearings in court. Therefore, in order to obtain a binding decision, the trial may last from several months to years, based on its complexity.

    Another disadvantage consists in the fact that the interpretation of the law and the jurisprudence are not unitary, the chances for success of a litigation depending on the legal opinion of the competent court.

  24. What is the most likely growth area for disputes in your jurisdiction for the next 5 years?

    It is expected that the number of disputes in the Data Protection field will grow, as the EU General Data Protection Regulation entered into force this year. This is due to the fact that in the present any document may be qualified as containing personal data. Altogether, the national Data Protection authority seems to have expanded its activity.

    It also expected that there will be an increasing number of Tax disputes, considering that the Tax law have suffered numerous changes.

    Given the increasing interested in the protection of the environment, we also expect a significant growth in this field.

  25. Will be the impact of technology on commercial litigation in your jurisdiction in the next 5 years?

    As far as technology is concerned, we consider that in the near future, the technology will (and it must) also impact commercial litigation.

    For instance, we consider developing an online platform to view the judiciary documents is mandatory. In the present, this possibility exists only in some counties.

    This would facilitate the access to the documents, so both the parties, third parties and the judge may submit proper documents on the platform and view what the opponent party has submitted.