GERMANY Law and Practice Contributed by: Tanja Pfitzner, Fabian von Schlabrendorff and Niklas-Arne Hecht, Pfitzner Legal
8.3 Enforcement of Settlement Agreements
to give a preliminary opinion on the factual and legal issues of the dispute right at the beginning of a hearing, which often leads to a settlement between the parties. 7.8 General Timeframes for Proceedings Due to the general duty of the courts to expedite proceedings, German proceedings are consid- ered to be completed quickly. However, there is no general rule as to how long a particular dispute might take. The timeframe depends on factors of complexity and efficiency. Court proceedings can last from a few weeks – in the case of preliminary injunctions even just a few hours – and up to several years in very com- plex matters. Usually, proceedings take about one year per court instance if the parties are will- ing to present their case quickly and efficiently.
A settlement recorded by the court is an execu- tion title and can be enforced in the same way as a final judgment. An out-of-court settlement is not enforceable per se. A party claiming a breach of an out-of-court settlement usually must file a new civil action to enforce the settlement agree- ment. Out-of-court settlements may be enforce- able if they are notarised by a notary public or signed by the parties’ attorneys on the condition that the debtor expressly submits to immediate enforcement, and if they are filed with the local court where one of the parties is domiciled. 8.4 Setting Aside Settlement Agreements As a contractual agreement, a settlement is gen- erally binding due to the rule of pacta sunt serv- anda. Out-of-court settlements can be set aside like any other contract – eg, on the grounds of exceptio doli. A settlement recorded by the court generally cannot be withdrawn. For this reason, the parties often conclude a settlement in court under the condition precedent that it becomes final unless one of the parties formally objects to it in writing to the court within an agreed time period. Such a conditional settlement is advisable – eg, if a party needs the consent of internal corporate bodies or third parties such as an insurer. 9. Damages and Judgment 9.1 Awards Available to the Successful Litigant German procedural law provides for three main categories of judgments: • judgments for affirmative relief – eg, perfor- mance, payment, omission or compensation;
8. Settlement 8.1 Court Approval
Civil proceedings often end with a settlement between the parties. Generally, court approval is not required to settle a lawsuit. Exceptions apply – eg, to settlements in collective actions where
the approval of the court is required. 8.2 Settlement of Lawsuits and Confidentiality
A settlement under German law has the legal nature of a contract between the parties to the settlement, even if it is recorded by the court. Therefore, settlements can be kept confidential if the parties so agree. However, settlements recorded by the court may become public because of the principle that hearings are gener- ally public. If the parties wish to ensure confiden- tiality, it is advisable to negotiate the settlement out of court and include a confidentiality clause.
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