“LG Mannheim Three-year limitation period for damages begins with the delivery of the prospectus”.

The regional court Mannheim rejected by its judgement of 07.03.2007 the complaint of an investor, who as can be prove in the year 1996 a folder had been handed over. The prospectus had listed the main risks. RA Diplom-Jurist Thomas Keppel, Kanzlei Dr. Johannes Fiala, Munich, www.fiala.de won the judgement. He comments on the legal position, as follows:
Excerpt from the judgment brief:
The plaintiff made a claim against the defendant investment adviser for allegedly giving incorrect advice when recommending a capital investment in 1996. The Regional Court dismissed the action brought at the end of 2006 with reference to the statute of limitations for any existing claims. Before the reform of the law of obligations, claims arising from a positive breach of contract in an investment advisory contract were subject to a limitation period of 30 years. According to the transitional provision of Art. 229 § 6 EGBGB, the limitation period was shortened to three years as of 1 January 2002. In principle, the limitation period begins with the accrual of the claim. According to the established case law of the Federal Court of Justice (BGH), an investor who has acquired a capital investment that is disadvantageous to him on the basis of an erroneous recommendation is, as a rule, already damaged by its acquisition (BGH NJW 2005, 1597). According to recent BGH rulings. the commencement of the limitation period depends on the fact that the creditor became aware of the circumstances giving rise to the claim or should have become aware of them without gross negligence (§ 199 (1)). 1 No.2 BGB). In the present case, the risks of the capital investment were listed in the issuing prospectus. The plaintiff had expressly confirmed its receipt in writing in his declaration of accession. In such a case, however, the lack of knowledge must be attributed to gross negligence on the part of the plaintiff. Either he received the issue prospectus and did not read it or he confirmed receipt of the prospectus and nevertheless did not insist on it being handed over, thereby depriving himself of the opportunity to obtain the relevant information, both of which are to be regarded as gross negligence within the meaning of section 199 (1) of the German Stock Corporation Act. 1 No.2 BGB to be considered.
And conclusion of RA Fiala:
For sales controlling, it is crucial that the investment intermediary has the receipt of the prospectus separately acknowledged in writing. In particular, it must be ensured that the handover does not take place on the day of the drawing. A receipt linked to other declarations, for example on the subscription form, may be ineffective (cf. OLG Hamm, judgement of 26.03.2003, ref. 8 U 170/02).
Lead sentence by RA Fiala, MBA:
Three-year limitation period for damages begins with the delivery of the prospectus to the investor, even if the investor does not read the prospectus until nine years later.
(DA No 15A07 of 11.04.2007, p. 5)
Courtesy ofwww.direkteranlegerschutz.de.

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Dr. Johannes Fiala Dr. Johannes Fiala

Dr. Johannes Fiala has been working for more than 25 years as a lawyer and attorney with his own law firm in Munich. He is intensively involved in real estate, financial law, tax and insurance law. The numerous stages of his professional career enable him to provide his clients with comprehensive advice and to act as a lawyer in the event of disputes.
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