Dieselgate precedent set at German court

26 May 2020

26 May 2020

Germany’s highest court for civil disputes, the Bundesgerichtshof (BGH), has ruled that Volkswagen (VW) must pay compensation to a motorist who bought a diesel-powered vehicle fitted with emissions cheating software.

In the first Dieselgate claim to be heard in the Federal Court of Justice, it was decided that the plaintiff, Herbert Gilbert, will be paid €28,000. This followed the ruling that the 65-year-old was entitled to return his vehicle and receive a partial refund, plus interest. Gilbert purchased a VW Sharan in 2014 for approximately €31,500.

Setting a precedent

The ruling passed on 25 May sets a benchmark for roughly 60,000 other cases in Germany. VW said it would now offer affected motorists a one-off payment, with the amount dependent on individual cases.

In a statement sent to Autovista Group, the carmaker said the ruling will bring closure for the proceedings in Germany. ‘For the majority of the 60,000 pending cases, this ruling provides clarity as to how the BGH assesses essential questions in German diesel proceedings,’ the statement said.

The carmaker is now looking to bring these proceedings to a prompt conclusion in agreement with the plaintiffs. ‘We will, therefore, approach the plaintiffs with the adequate settlement proposals. The aim is to relieve the burden on the judiciary as quickly as possible.’

‘There will hardly be any reason for new lawsuits,’ the manufacturer said. ‘This is the result of the high acceptance rate for settlements in the declaratory model proceedings (Musterfeststellungsverfahren) and the limitation period for claims that have not been registered for the declaratory model proceedings.’

VW did point out that some issues were not addressed in yesterday’s judgement. This includes the implementation of the statute of limitations and the grounds for claiming when a purchase was made after September 2015. The latter case group apparently accounts for a high number of pending proceedings, roughly 10,000.

‘We are convinced that plaintiffs have no claims when they had knowledge of the switching logic at the time of purchase,’ VW said. ‘In this respect, we will defend our position accordingly in the pending proceedings.’

Dieselgate so far

Most recently in April, the UK High Court found that emissions-testing software installed in VW’s vehicles did constitute unlawful ‘defeat devices’ under EU rules. This was the court’s first major Dieselgate ruling, following a preliminary hearing in December 2019. Some 90,000 motorists in England and Wales have brought action against VW.

In February, the manufacturer settled a separate €830 million class-action suit involving 235,000 German drivers. Depending on the age and model of their vehicle, owners could receive between €1,350 and €6,250. In January, six VW managers were also charged with ‘deliberately misleading’ authorities and customers before the diesel scandal broke. The carmaker was fined €1.2 billion by German prosecutors in 2018.

Last year, a Prague council granted Czech drivers of Volkswagen and Skoda vehicles compensation equivalent to €20.8 million in relation to Dieselgate. VW also paid €27 billion in fines in the US, where it was found guilty of cheating on emissions testing. Vehicle refits, fines and provisions related to the scandal have so far cost VW more than €30 billion globally.