Last Update: 15. November 2024

What fees are incurred in a judicial dunning procedure?

A judicial dunning procedure begins with filing an application for a dunning notice, a straightforward legal action to collect outstanding debts. However, this first step already involves costs, which the creditor must initially cover. These fees depend on the claim’s value, meaning the higher the claim, the higher the fees.

Court fees for the dunning notice

Court fees, also called application fees, are charged at the start of the dunning process. This basic fee covers the court's administrative work in reviewing the application and issuing the dunning notice. The fee is generally set at half the standard rate (0.5 of the regular fee rate), with a fixed minimum fee of €36. This means:

For lower claim amounts, where half the fee would be less than €36, the minimum fee of €36 still applies.
Once half the fee exceeds €36 (depending on the claim amount), the fee is set accordingly.

The fee rates are legally regulated and increase in increments based on the claim amount:

Claim amount up to €1,000: Court fee €36
Claim amount over €1,000 to €1,500: Court fee €39
Claim amount over €1,500 to €2,000: Court fee €49
Claim amount over €2,000 to €3,000: Court fee €59.50
Claim amount over €3,000 to €4,000: Court fee €70
Claim amount over €4,000 to €5,000: Court fee €80.50

These application fees must be paid in advance by the creditor. If the dunning procedure successfully recovers the debt, the creditor can demand that the debtor reimburse these fees along with the original claim.

Since the creditor initiates the process, they must advance these initial dunning procedure costs. This means that application and service fees must be paid upfront. However, if the claim is collected successfully, the costs can be assigned to the debtor and reclaimed by the creditor.

How do court fees accumulate as the procedure progresses?

If the debtor does not pay after the dunning notice is issued, the creditor can escalate the process to increase pressure on the debtor to pay. This often involves applying for an enforcement notice, which allows further collection actions. Such actions result in additional fees, which may be significantly higher than the initial court fees.

Court fees for the enforcement notice

Filing for an enforcement notice is a critical step that grants the creditor authority to initiate legal collection measures, such as garnishments. The cost for the enforcement notice is based, as before, on the claim amount. This step involves separate fees, which the creditor initially covers. The enforcement notice fees are in addition to those already paid for the dunning notice. If the claim is successfully enforced, the creditor can later add these costs to the debt owed by the debtor.

Costs for involving a bailiff

If the debtor continues to withhold payment, additional enforcement actions like garnishment may be required. These actions often involve appointing a bailiff, who can seize the debtor’s assets or initiate wage garnishment. Each action performed by the bailiff incurs additional fees, charged to the creditor. The bailiff fees depend on the type and scope of the action—for example, seizing a vehicle or garnishing wages can involve higher costs.

To sum up, the costs can increase significantly as each additional step to enforce the claim incurs further charges. These additional fees for enforcement actions and bailiff services are typically charged to the debtor if the creditor wins the case. However, if the creditor withdraws the case or loses, they remain responsible for the fees.

What fees do attorneys and collection agencies incur?

Many creditors enlist attorneys or collection agencies to assist with the dunning procedure, which incurs extra fees during various stages of the process.

Attorney fees: Attorneys’ fees are calculated according to the German Attorneys' Fees Act (RVG) and are also based on the claim amount. Costs can rise quickly, especially if the attorney provides representation at multiple stages.
Collection agency fees: Collection agencies, specialized in debt collection, also charge fees based on the claim amount and the work required. These costs are initially borne by the creditor, though they may be recoverable from the debtor if the claim is successful.

What changes if a collection agency is involved?

If a creditor hires a collection agency, the agency often pre-finances procedural costs, including application and service fees for the dunning notice. The agency also manages and coordinates any necessary follow-up steps, such as contestations and enforcement measures.

If the debt is successfully collected, the agency will recover the total procedural costs and their collection fees from the debtor. However, if the case fails or is abandoned, the creditor may still be liable for some costs, depending on the agreement with the collection agency.

What does a contestation or appeal in the dunning procedure cost?

If the debtor disputes the dunning notice, they may file a contestation. Similarly, they may appeal the enforcement notice, which advances the case to a further stage and incurs additional court fees.

Contesting the dunning notice: A contestation indicates that the debtor challenges the claim, requiring a judicial review that incurs further fees, again based on the claim amount.
Appealing the enforcement notice: If the debtor appeals, a more detailed review by a judge is necessary, which also adds fees initially borne by the creditor.

These contestations and appeals can significantly raise the creditor’s costs as the procedure becomes more complex and prolonged.

Who ultimately pays for the judicial dunning procedure?

Responsibility for costs is a key consideration for both creditors and debtors. Generally, if the claim is upheld and the case is successful, the debtor will cover the procedure’s costs. However, different outcomes are possible:

Debtor pays the costs: If the creditor wins, the debtor must cover all court and attorney fees.
Creditor pays the costs: If the case is dismissed or the creditor drops it, they bear all costs.
Cost-sharing in a settlement: In a settlement, both parties typically agree to share the procedural costs. This means each party covers part of the costs based on the agreement.

Ultimately, the allocation of costs depends on how the case progresses and the final judgment.