Member Article

On December 22, 2023, Agder Court of Appeal issued a ruling in a case between an excavator seller and a leasing customer who had leased an excavator through a leasing company. According to the agreement between the parties, the leasing company was the formal owner of the excavator. The role as owner was however limited to financing. The question was whether the leasing customer was entitled to file a lawsuit about defects directly against the seller pursuant to section 1-3 of the Dispute Act, or whether this could only be done by the leasing company as a formal owner.

The Court of Appeal pointed out that the decisive factor for access to legal action under section 1-3 of the Dispute Act in this case was whether the leasing customer had a genuine need to have the claim settled in relation to the seller. According to the provision, this shall be determined based on an overall assessment of the actuality of the claim, and the parties’ connection to it. Further, the Court of Appeal referred to the general rule that parties can normally only pursue their own rights and obligations before the courts, with recourse to the district court&s ruling where this was been given decisive weight. However, the Court of Appeal did not agree that this general rule resolved the question of the leasing customer’s right to file a lawsuit.

In the Court of Appeal’s view, the District Court’s approach did not sufficiently take into account the nature of the leasing agreement as a three-party relationship. The facts of the case were that the leasing customer entered into a contract with the seller, with an agreement that the purchase would be financed by leasing regulated in a separate contract. An agreement was then entered into between the seller, the leasing company and the leasing customer. In addition, the leasing customer and the leasing company entered into a separate leasing agreement. The agreements stipulated that the leasing company was not to be involved in disputes relating to the excavator. The Court of Appeal emphasizes that the agreements must be seen as a whole, and with reference to the nature of the leasing agreement as a three-party relationship, the court concluded that the leasing customer had a genuine need to have the claim settled against the seller under section 1-3 of the Dispute Act.

This ruling from the Court of Appeal was appealed to the Supreme Court by the seller of the excavator. Before the Supreme Court, The Association of Norwegian Finance Houses intervened in support of the leasing customer. With assistance from the counsel Christian Reusch the association submitted a written submission arguing that the leasing customer could file the lawsuit against the seller.

On April 16, 2024, the Supreme Court’s Appeals Committee issued its decision. In the ruling, the Appeals Committee rejects the leasing company’s appeal on the grounds that it clearly could not succeed. This means that the Supreme Court’s Appeals Committee agreed with the Court of Appeal’s interpretation of the Disputes Act section 1-3, and found no reason to justify the result further. The case that the leasing customer filed against the seller of the excavator, therefore must be brought before the district court.

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