How to get Equitable Relief (Equitable Remedy) under German Law

Equitable relief, also known as equitable remedies, is a legal concept which was historically developed by the old English courts. Thus, the terms equitable relief and equitable remedy are only being used by lawyers in common law jurisdictions where such judicial remedies are still available today.

In practice, seeking equitable relief means that a Plaintiff asks the court to award a non-monetary judgment against a Defendant. For example, an order requiring the Defendant to do something, i.e. to perform a specific act (thus the legal term „specific performance“); or an order requiring the defendant to refrain from doing something (this is typically called an „injunction“, in German „Unterlassung“).

Contracts drafted by lawyers in common law jurisdictions contain Equitable Remedy Clauses as standard boilerplate clauses. Lawyers from non-common law jurisdictions (like Germany, France or Spain), usually do not really understand what to make of these terms, especially since the expression „equitable“ is not self explanatory. Still, German business executives sign contracts and CDAs which contain such equitable remedy clauses all the time, often without having a real clue what this would mean in case of a legal dispute.

The situation becomes especially confusing if a German lawyer uses an English language contract template (which is based on English or US law and thus contains such equitable relief clauses) and then simply modifies the template by making the contract subject to German laws and giving German courts exclusive jurisdiction. This happens all the time in German-British or German-US business relationships. Sometimes applicable law and jurisdiction clauses are changed at the last minute when the parties want to close the deal and the executives think it a good idea to agree on German, Austrian or Swiss law as a „compromise“. In all these German speaking countries, no lawyer or judge will know what equitable relief is. What will happen in an international legal dispute, if the business partners must go to a German (or Austrian or Swiss) court of law and find such an equitable remedy clause in the relevant agreements? mehr lesen…