Maxisports SA, a French manufacturer of fitness equipment, agreed to supply rowing machines to Ben, an Irish retailer. Under the contract, Ben reserved the right to reject the goods if they failed to comply with any relevant provisions of EU law. (Fictitious) Council Regulation 27/89 ('the Regulation') requires fitness equipment to be fitted with safety notices in a 'permanent form'.

The machines arrived at Ben's store in Dublin. They carried safety notices attached to the machines with plastic tabs. Ben refused to take delivery, claiming that the machines did not comply with the Regulation because the notices were not in a 'permanent form'. Ben brought proceedings in the Irish High Court for return of the purchase price. Maxisports rejected this claim on the grounds that the rowing machines complied with the Regulation.

In the Irish High Court, it was established that the rowing machines had a working life of up to six years and that the safety notices were sufficiently secure to remain intact for between three and four years. The court was referred to an earlier Irish Supreme Court decision in which the words 'permanent form' in the Regulation had been interpreted to include any method of attachment that could reasonably be expected to endure throughout the period of the manufacturer's guarantee. Their Lordships had reasoned that equipment became obsolete once a guarantee had expired, because repairs were so expensive. Counsel for Maxisports argued that, since Maxisports' machines were guaranteed for three years, the safety notices were in a 'permanent form' and that therefore the machines complied with the Regulation. The Irish High Court took the view that it was bound by the Supreme Court’s interpretation and declined to make a reference to the Court of Justice. It gave judgment for Maxisports.

On appeal, the Irish Court of Appeal disagreed with the Supreme Court’s interpretation of 'permanent form' stating that these words clearly meant that the notices must be attached to fitness equipment in such a way as to remain intact throughout its working life. Nonetheless, taking the view that it was bound by the Supreme Court’s interpretation, the court refused to make a reference to the Court of Justice, gave judgment for Maxisport, and refused leave to appeal to the Supreme Court.

Consider the application of Article 267 TFEU to this situation.

The jurisdiction of the Court of Justice

• Under Article 267 TFEU the Court of Justice has jurisdiction to give rulings on questions of interpretation of EU law, including secondary legislation.
• This case concerns the interpretation of the words 'permanent form' in (fictitious) Regulation 27/89 and so the Court has jurisdiction.
• This is a genuine contractual dispute between Maxisports and Ben in which the interpretation of the Regulation is relevant and in which the material facts appear to have been established. On that basis, it would be very surprising if the Court of Justice refused jurisdiction (as in Foglia).

The Irish High Court

• The High Court's decision in this case is clearly subject to appeal to the Court of Appeal, since the question refers to an appeal in the latter court. That being so, the High Court is not a 'court against whose decision there is no judicial remedy under national law' under Article 267(3) and it therefore has no obligation to refer.
• Article 267(2) provides that where a question of interpretation of EU law is raised before any court of a Member State, that court may, if it considers that a decision on the question is necessary to enable it to give judgment, request the Court of Justice to give a ruling.
• The High Court seems to have concluded that it is precluded from making a reference because it is bound by the Supreme Court’s interpretation of the Regulation in an earlier case. This view is misguided. National rules of precedent have no impact on the discretion to refer (Rheinmühlen). This means that the Supreme Court’s ruling does not prevent the High Court from making a reference to the Court of Justice.
• Under Article 267(2) the High Court has discretion to refer if it considers that an interpretation of the words 'permanent form' is necessary to enable it to give judgment.
• It is for the High Court to determine the relevance of the questions referred (Dzodzi). Whilst there are cases in which the Court of Justice declined to accept a reference because the interpretation sought bore no relation to the main action, such cases are rare. Here, the interpretation of the words 'permanent form' in the Regulation is not only relevant but is conclusive to the outcome of the case.
• If it decided to refer, it would be for the High Court to determine the timing, though the facts and relevant legal issues should first be established (Irish Creamery). The Court of Justice has on occasions refused to accept references from national courts when it has been provided with insufficient information (see for instance Telemarsicabruzzo). From the information given, it appears that the facts and legal issues have been established by the High Court.
• The High Court appears not to have considered whether the words 'permanent form' are clear. According to CILFIT, a provision of EU law is acte clair if it is 'so obvious as to leave no scope for reasonable doubt as to its meaning'. The national court must be convinced that the matter is equally obvious to the courts of the other Member States. It must bear in mind that EU law is drafted in several languages; that EU law uses terminology that is peculiar to it; that legal concepts do not necessarily have the same meaning in EU law and the law of the various Member States; and that EU law must be placed in its context. In reality these matters are difficult for a national court to determine. At the very least, the English judgments in Samex and ex parte Else urge national courts to take into account the advantages of the Court of Justice in interpreting EU law.
• Whilst the case law outlined above provides useful guidance on the exercise of its discretion, this does not alter the position under EU law. The High Court may refer if it wishes but it has no obligation to do so.

Irish Court of Appeal

• As 'any court' under Article 267(2), the Court of Appeal may refer if it chooses to do so. In exercising its discretion, it has available all the guidance discussed above in relation to the High Court. One important difference, demonstrated by its disagreement with the Supreme Court’s interpretation, is that the meaning of 'permanent form' is now disputed. However, although this indicates that the Regulation is not acte clair, this factor does not convert the Court of Appeal's discretion to refer into an obligation.
• The separate issue is the position of the Court of Appeal under Article 267(3). The Court of Appeal's decisions are subject to appeal to the Supreme Court only with leave either of the Court of Appeal or the Supreme Court. Does that mean that the Court of Appeal is a 'court against whose decisions there is no judicial remedy under national law' and that it is therefore obliged to refer under Article 267(3)?
• Lyckeskog concerned an appeal from a decision of the Court of Appeal for Western Sweden to the Swedish Supreme Court. Here, the Court of Justice held that the fact that the merits of the appeal were subject to a prior declaration of admissibility by the Supreme Court did not deprive the parties of a judicial remedy and, in these circumstances, the Court of Appeal was not a final court. Thus, in Maxisports' case, the Court of Appeal has no obligation to refer.

Irish Supreme Court

• As noted above, the Court of Appeal has refused leave to appeal to the Supreme Court.
• However, if the matter came before it, the Supreme Court would be under an obligation, under Article 267(3), to refer the matter to the Court of Justice for a preliminary ruling either at the stage of considering admissibility or at a later stage (Lyckeskog).
• Consequently, whilst the Court of Appeal in Maxisports' case has no obligation to refer, the Supreme Court must do so either when considering leave to appeal or at a later stage, subject to the exceptions referred to in CILFIT. A national court of last resort has no obligation to refer where a question of EU law is not relevant; where the Court of Justice has previously ruled on the point; or where the correct interpretation of EU law is so obvious as to leave no scope for reasonable doubt as to its meaning (the doctrine of acte clair) discussed above.
• However, in Köbler the Court of Justice held that state liability in damages would arise if it was manifestly apparent that a national court of last instance had failed to comply with its obligations under Article 267(3), for instance by misapplying the doctrine of acte clair.