Pursuing Legal Action in Germany?

You found the German law firm perfectly equipped to address your legal needs in Germany

Since 2003, German law firm Graf & Partners specialises in providing legal advice and litigation services to British and American clients. The majority of our clients come from Britain, the USA or other English speaking countries and are in need of pursuing a legal matter in Germany. If you need a competent and trustworthy attorney anywhere in Germany, our experienced contract lawyers and bilingual litigators will be happy to assist.

The firm’s managing partner Bernhard Schmeilzl and several other lawyers in our litigation team have studied and worked in the USA and/or Britain. As a result, Graft & Partners have established a unique and impressive international legal practice, which focuses specifically on British-German and German-American legal cases and issues. Our Anglo-German lawyer team is headed by British and Canadian citizen Elissa Jelowicki, a qualified English solicitor, and Registered European Lawyer, admitted to the Munich Bar Association. Therefore, foreign clients and instructing lawyers from the UK and America are able to discuss their specific case with a native English speaker, who also knows the English legal system.

Our German and British litigation lawyers appear before German law Courts throughout the country and are also experienced in (Commercial) Arbitration and Alternative Dispute Resolution. We provide specialist legal advice, support and forensic services in all commercial and civil law matters, ranging from contract disputes, corporate litigation and employment, to damage claims and contentious probate. In addition, our family law experts deal with international divorces and child custody matters. In relation to other legal areas, e.g. criminal law or tax, we will be happy to recommend qualified German lawyers from other chambers, who are also fluent in English.

On a regular basis, we speak on German-American and British-German legal issues at lawyer conventions and at in-house events of international companies and law firms. See here for some of the topics we have spoken on recently:

More information on litigation and legal fees in Germany is available in these posts:

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Call the experts on German-British and German-American legal matters

Since 2003, the German law firm Graf Partners LLP with its headquarters in Munich specialises in British-German and US-German legal cases. Our German lawyers are fluent in English, have many years of practical experience with clients from Britiain and the USA and are part of a well established network of law, tax and accounting firms.

Bernhard Schmeilzl_crop1Managing partner Bernhard Schmeilzl was admitted as German Rechtsanwalt (attorney at law) to the Munich Bar in 2001 and specialises in international cases ever since, especially German-American and German-English commercial and probate cases. In addition to obtaining his German legal exams with distinction, he also graduated from the English University of Leicester where he obtained his Master of Laws degree in EU Commercial Law in 2003. 

In 2014, Graf Partners LLP has set up the international litigation department GP Chambers which focuses on providing professional litigation services to British and US-American clients, both on a commercial and a private client level. The Graf Partners litigation lawyers regularly appear before German law Courts throughout the country and provide specialist legal advice, support and advocacy services in all commercial and civil law matters, ranging from contract disputes, corporate litigation and employment, to damage claims, divorces and contentious probate. If you wish us to advise or represent you in a German or cross border case, or if you need an expert report on German law, please call +49 941 463 7070.

Pitfalls of German Law (Part 2)

Be careful when suing a German Kommanditgesellschaft (KG), an Offene Handelsgesellschaft (OHG) or a Gesellschaft bürgerlichen Rechts (GBR)

The single most common mistake foreign claimants and their non-German litigation lawyers make when taking a German business to court is that they only sue the partnership itself and not the personally liable partners (persönlich haftende Gesellschafter).

To avoid any misunderstanding: This post deals with German partnerships (Personengesellschaften) as debtors, not with German limited liability companies (GmbH) or German corporations (Aktiengesellschaft). If the debtor is a German company, then – normally – only the company itself can be sued, not the company’s shareholders. There may be special circumstances when a director of even a shareholder may be personally liable for a company debt (piercing the company veil, in German: Durchgriffshaftung), but this is the exception to the rule.

The situation is entirely different with German partnerships, which come in four different shapes and forms:

  • Kommanditgesellschaft (KG), mostly in the form of a GmbH & Co KG
  • Offene Handelsgesellschaft (OHG)
  • Gesellschaft bürgerlichen Rechts (GbR), also called BGB-Gesellschaft
  • Partnerschaftsgesellschaft (PartG)

What these German partnerships have in common is that there is at least one partner who is liable for all business debts with his entire personal property (Privatvermögen). The relevant statute is section 128 German Commercial Code (§ 128 Handelsgesetzbuch). With regard to the OHG and the GbR all partners are fully liable. With regard to the Kommanditgesellschaft (KG) there are two kinds of partners: fully liable partners (Komplementäre) and limited partners (Kommanditisten), who are only liable up to the amount they have invested.

Now, if you (or your client) have a claim against such a German KG, OHG, GbR or PartG, the biggest mistake you can make is to sue only the partnership itself. This is because with a court order against the partnership you can only enforce your claim against the partnership, i.e. the business assets of said partnership. In many cases, however, it is likely that there are no longer any business assets to go after as the partnership is doing poorly or has even folded.

In these circumstances, you will naturally want to go after the personally liable partners of the partnership. And, you can. But only if you have listed them as joint and several co-debtors (Gesamtschuldner) in your lawsuit against the partnership.

If you (or your litigation lawyer) have not done this, then the court order cannot be enforced against the partners. You will have to start a new lawsuit all over again. In some cases, you may of course face limitation problems by then (German limitation periods are explained here).

Thus, whether you sue the German partnership in Germany or abroad, you must ensure that you do not only list the partnership itself as a defendant but also every personally liable partner which you may want to enforce the court order against at a later stage. Psychologically, this puts much more presure on the defendants and thus increases the chances of payment or a favourable settlement agreement. By the way: the lawsuit costs are not increased by co-suing the partners. So there is no reason whatsoever not to include them in your court claim.

See here for other “Pitfalls of German Law“.

More information on litigation and legal fees in Germany is available in these posts:

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The law firm Graf & Partners was established in 2003 and has many years of experience with British-German and US-German legal matters.The Anglo-German litigation lawyer team of GP Chambers is well equipped to advise and represent clients from the UK, the USA and other English speaking countries. If you wish us to advise or represent you in a German or cross border case, or if you need an expert report on German law, please call +49 941 463 7070 in order to contact German lawyer Bernhard Schmeilzl, LL.M. (Leicester), managing partner and head of the litigation department. Bernhard is also frequently asked by British and US Courts and Tribunals or by legal counsels to provide expert reports and legal opinions on German law.

Dodging Debts by Moving to the UK?

Has your German Debtor moved to the UK and declared himself or herself bankrupt under the UK / British Insolvency Rules?

Since we specialise in British-German legal matters, our firm very often gets enquiries from German individuals, companies or banks regarding a situation whereby a German individual has moved to the United Kingdom and declared bankruptcy in order to avoid paying their debts and liabilities back in Germany. Even further, it is quite common that civil proceedings will have been commenced in Germany, but particular the individual pleads that they do not need to repay the debt in Germany in light of their bankruptcy back in the UK.

The way individuals are able to declare bankruptcy in the UK is now much much easier than before (yes, a bit shocking considering it was not that difficult before). Previously, one would have to petition to the Court, however, as of 6 April 2016, the individual debtor no longer has to. Instead, they must make an online application to an adjudicator (not a judge anymore). If a debtor’s application provides all the prescribed information, and is considered appropriate, the adjudicator will automatically (this is indeed what makes the new system scary) make a bankruptcy order pursuant to its statutory jurisdiction under the Insolvency Act 1986 (IA 1986). The adjudicator is an official appointed by the Secretary of State for the Department for Business, Energy and Industrial Strategy (again – this adjudicator no longer has to be legally qualified).

The adjudicator has no inherent discretion over whether to make an order (again this probably concerns you if you believe that the individual is not telling the truth). If the statutory requirements for an order are met, the adjudicator must make it; if they are not met, the adjudicator cannot make the order.

The statutory requirements are:

  • The adjudicator had jurisdiction under section 263Iof the IA 1986 to determine the application on the date the application was made.
  • The debtor is unable to pay his or her debts at the date of the determination.
  • No bankruptcy petition is pending in relation to the debtor at the date of the determination.
  • No bankruptcy order has been made in respect of any of the debts which are the subject of the application at the date of the determination.

The adjudicator must make a bankruptcy order against the debtor, or refuse to make such an order, before the end of 28 days from the date of the bankruptcy application, unless the adjudicator requests further information from the debtor. If the adjudicator requests further information the adjudicator has 42 days from the date of the application to make an order. If the adjudicator does not respond to the debtor before the end of this period, the application is deemed refused.

What do you do in such a situation? Well, the process is not easy, but it is possible to overturn such a bankruptcy order, referred to a lot of time as a „sham bankruptcy in order to avoid paying debts“. The courts have retained their general jurisdiction over all bankruptcy proceedings commenced following the adjudicator’s bankruptcy order (including a rescission or annulment application), and will also hear any appeal from the adjudicator’s decision to refuse to make a bankruptcy order.  Moreover, it is an offence if the individual knowingly or recklessly to make any false representation or omission in making a bankruptcy application to the adjudicator or providing any information to the adjudicator in connection with a bankruptcy application.

It is also an offence knowingly or recklessly to fail to notify the adjudicator of a matter in accordance with a requirement imposed by the legislation. It does not matter whether or not a bankruptcy order is made as a result of the relevant application, and it will be no defence that any part of the offence was committed outside England and Wales.

So, if you are owed money in Germany and believe that your German debtor has run to the UK to declare themselves bankrupt, and in fact, it is a sham, you should contact the local bankruptcy department as soon as possible so that it can be overturned.

For more information about German law, in particular civil litigation and debt collection in Germany see these posts:

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The law firm Graf & Partners was established in 2003 and has many years of experience with British-German and US-German legal matters.The Anglo-German litigation lawyer team of GP Chambers is well equipped to advise and represent clients from the UK and other English speaking countries. If you wish us to advise or represent you in a German or cross border case, or if you need an expert report on German law, please call +49 941 463 7070. To contact English solicitor Elissa Jelowicki in Munich please write an e-mail to elissa(AT)grafpartner.com.

For how long can a Creditor demand Repayment of a Loan under German Law?

Germans have the saying “Bei Geld hört die Freundschaft auf” which loosely translates as “it’s better not to mix friendship and money matters”. Friends or relatives do borrow money though. What often causes problems is that the parties feel uncomfortable about creating a formal, written agreement. The approach tends to be: “We are good friends and trust each other, therefore we do not need a formal contract.” Unfortunately, lawyers’ filing cabinets are stacked with cases that started out like this and resulted in friendship-ending law suits a few years later.

If there is only a verbal loan agreement and the parties have not expressly agreed on a specific term for the loan, a common legal issue is when does the loan become due for repayment? For private loans, section 488 (3) German Civil Code stipulates that in these cases both lender and borrower can terminate the loan agreement with three months’ notice. Continue reading

How Assets are distributed to Creditors through Corporate Insolvency

General principles of asset distribution in insolvency (UK)

By definition, an insolvent company does not have sufficient assets to pay in full all the liabilities that it owes to its creditors. Accordingly, one of the primary functions of both administration and liquidation of a company is to realise the assets of the insolvent company and to distribute those case realisations made from those assets among the insolvent company’s creditors. Continue reading

Need to Chase a Debt in the UK but Fear the Debtor is Insolvent?

Your quick guide to the basics of Personal Insolvency in the UK

The two main insolvency procedures available to insolvent individuals in England and Wales are: (i) Bankruptcy and (ii) Individual voluntary arrangements. This note will focus on bankruptcy and not individual voluntary arrangements.

What is bankruptcy?

Bankruptcy is a process by which the assets of a debtor are realised and distributed amongst his creditors. The main features of a bankruptcy are: Continue reading

English Lawyers in Germany

mainimg_elissa_v2Whether you have been involved in a car accident in Germany, need advice on German labour law or other contract matters, plan to start a German business, want to buy a house in Germany or need to swear an oath before an English solicitor, the Munich based law firm Graf & Partners can provide the necessary legal advice and representation. The firm was established in 2003 and speciales in British-German legal matters. If you need to see an English lawyer in Germany, you can arrange for a personal appointment with English solicitor Elissa Jelowicki in Munich or we can arrange for a secure video or telephone conference if you are located elsewhere. To contact Elissa please call +49 (0)89 3539 6767 or write an e-mail to elissa (AT) grafpartner.com.

How expensive is a German Lawsuit?

Mandatory Legal Fees in German Civil Law Matters

We have shown here that chasing a debt in Germany is fairly easy and quick. While we also explained the basic rules regarding court and lawyer fees in section 3 of said article many readers ask us how much an actual lawsuit will cost them. Thus, here a more practical approach to that question, explained by the German litigation experts of Graf & Partners (GP Chambers): Continue reading

Alimony in Germany: Child Maintenance and Financial Support for Single Mothers

You are or have been in a relationship with a German woman. She is pregnant and wants you to pay alimony for the newborn-to-be. But you are not sure whether you are the father. What to do?

This post deals with unmarried couples only. For children born in marriage, German law presumes that the husband is the father. If the husband has doubts about this then he must contest paternity pursuant to see Sec. 1600 German Civil Code, and this needs to happen within two years of learning of the circumstances that give him reason to doubt his paternity, see Sec.1600b German Civil Code. 

For children born outside marriage it must be determined who the father is, so called “Vaterschaftsfeststellung” (i.e. determination of paternity), see Sec. 1600d German Civil Code. The basics are explained on German Wikipedia here (however, only in German).

If the mother wants the (potential) father to pay child support and he refuses, then the mother can apply to the court and the court can – eventually – force the male to take a paternity test. However, psychologically, it may be a better alternative to take that test voluntarily, especially if the potential father is interested in joint custody and visitation rights, should it turn out that the child is actually his. 

Once it is determined who the father is, then the child is entitled to child support until the child finishes his/her education (see Sec. 1601-1615n German Civil Code). There exist court guidelines, the so called Düsseldorfer Tabelle, to determine the actual amount of child maintenance payments due. In addition, the mother can claim financial support from the male for herself for the period during which she is unable to work because she is taking care of the baby / child (see Sec. 1570 German Civil Code). The details depend on the financial situation of the parents and are unfortunately quite complicated, especially if there are other children and maybe even an ex-partner and a current wife.

For more on German and international family law, in particular on marriage, divorce and child custody rules please also see the posts below or simply click on the “Family Law” button in the right side column of this blog:

Or simply click on the “Family Law” section in the right column of this blog. You may also be interested in the sections debt collection and going to court.

The law firm Graf & Partners and its German-English forensic services and litigation department GP Chambers was established in 2003 and has many years of experience with British-German and US-German family law and probate matters, including the representation of clients in German litigation and arbitration proceedings. If you wish us to advise or represent you in a German or cross border legal matter please send an email or call us on +49 941 463 7070.

So you want to practice Law in Germany?

There are an impressive 160,000 advocates (Rechtsanwälte) registered to practice law in Germany (from the official statistics of the German Bar Association: German Advocates in February 2013). However, that doesn’t mean there are not interesting opportunities for British lawyers who are considering practising law in Germany: Continue reading