FINLAND Law and Practice Contributed by: Marja Norrena, Maija Ahtiainen and Valmari Keskimäki, Lieke Attorneys Ltd
By contrast, court-confirmed settlement agreements are comparable to judgments and are thus enforce- able without further legal action. 8.4 Setting Aside Settlement Agreements Like any other private agreement, private settlement agreements which have not been confirmed by the court can be set aside upon legal action, based on ordinary general contract law rules. On the other hand, court-confirmed settlement agree- ments do not become legally binding immediately, but only once the time limits for expressing dissatisfaction with the court’s decision to confirm the settlement, and for filing an appeal against it, have expired, or when an appeal against the confirmation of the settle- ment has been decided upon. Such an appeal could relate to the scope of the settlement, for example. However, the parties may agree that the agreement becomes binding immediately, in which case an appeal is not available. 9. Damages and Judgment 9.1 Awards Available to the Successful Litigant In outline, courts may render three types of judgments. • Executory judgment – the defendant is obliged to a certain performance, such as paying monetary damages or refraining from or tolerating a certain action. • Declaratory judgment – the court confirms whether a certain legal relationship exists or not. For exam- ple, the court may declare a contract invalid or confirm ownership of an object. • Constitutive judgment – the judgment itself alters an existing legal relationship or status. For exam- ple, the court may issue a judgment revoking a person’s legal paternity. 9.2 Rules Regarding Damages Finnish law on damages follows the principle of full compensation, meaning that, in general, individuals who incur harm are entitled to compensation for their entire loss. However, an equally important principle is that the injured party should not gain a financial
advantage through damages; in other words, they should be restored to their financial position prior to the damaging event. Therefore, punitive damages are not available under Finnish law. As a procedural note, courts are not allowed to award damages in excess of the amount claimed. The courts may, however, reduce the amount of damages award- ed if full compensation would result in an unreason- able outcome. 9.3 Pre-Judgment and Post-Judgment Interest Under Finnish law, the concepts of pre-judgment and post-judgment interest are not recognised. Instead, a successful party may collect default interest under the Finnish Interest Act. The date from which default interest accrues depends on the situation. The most common situations are as follows. • If the due date of a debt has been set in advance in a manner that is binding on the debtor, interest for late payment must be paid from the due date onwards. • If the due date has not been set in advance in a manner that is binding on the debtor, interest for late payment must be paid 30 days after the creditor sent an invoice to the debtor or otherwise requested payment of a fixed amount. However, the debtor is not liable to pay interest for late pay- ment for the period preceding the receipt of the invoice or request. • For compensation of damages, interest for late payment must be paid 30 days after the creditor presented their claim and provided reasonable information regarding the basis and amount of the compensation. • If the claim is first presented in legal proceedings, interest begins to accrue from either the date on which the application for a summons is served to the defendant or the date on which the claim is presented, if it is submitted later in the proceed- ings. • If the court awards legal costs, interest begins to accrue one month after the compensation is awarded.
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