Cerascope Ltd & Anor v

Under Spanish law, a one-year limitation period for a commercial agent’s statutory compensation claim may be interrupted by an extrajudicial claim. The communication must, however, put the principal on notice of the nature of the claim whose limitation period is said to be interrupted. Detailed pleading is unnecessary, but a general complaint about termination and a threat of unspecified judicial action is insufficient where several claims are potentially available and have different limitation periods.

Cerascope acted as commercial agent for Todagres under a Spanish-law contract. Todagres terminated the agreement on 10 January 2005. Cerascope later claimed unpaid commission and statutory compensation under the Spanish implementation of the Commercial Agents Directive.

The parties agreed that the statutory compensation claim was subject to a one-year limitation period. Cerascope relied on letters sent by its Spanish lawyers on 2 March 2005 and 15 February 2006, contending that they interrupted the period under Article 1973 of the Spanish Civil Code. The preliminary issue was whether the first letter sufficiently notified Todagres of the statutory compensation claim.

1. The court determined the preliminary issue against Cerascope. The claim for statutory compensation under Article 31 of Law 12/1992 was statute barred.
2. The parties and their experts agreed that the one-year period under Article 31 could in principle be interrupted by an extrajudicial claim under Article 1973 of the Spanish Civil Code.
3. That principle did not mean that every communication expressing dissatisfaction or an intention to litigate interrupted the relevant period. The extrajudicial act had to identify, at least in general terms, the nature of the claim for which interruption was sought.
4. The letter of 2 March 2005 referred to the agency contract, alleged that its termination was wrongful, invited discussions and threatened unspecified judicial action. It did not refer to damages for breach of contract, statutory compensation or an indemnity for loss of goodwill under Law 12/1992.
5. Several possible claims were open to Cerascope, including claims with different limitation periods. The letter therefore did not give Todagres adequate notice that it faced a claim for compensation for loss of goodwill. The limitation period was not interrupted.