Contributed By Advokatfirmaet Hjort DA
The Norwegian legal system is based on civil law. The Dispute Act is based on an adversarial model where the parties, as a rule, are responsible for providing evidence and presenting their legal arguments. Cases are started and prepared through written submissions. But, as a rule, the parties are, at least at one stage during the proceedings, entitled to argue their case orally and to present their evidence directly to the court.
Formally most cases have to start in the conciliation board. Each municipality has a conciliation board, which consists of lay members. If the parties agree, if the subject matter of the dispute is less than NOK200,000 or, if the defendant does not show or submit a defence, the conciliation board may deliver a judgment.
The district courts are the ordinary first instance courts. There are a little over 50 district courts in Norway, each covering a specific geographic area. District courts handle all types of cases. There are only a few specialised courts that only handle specific types of cases. The most important ones are the labour court (arbeidsretten), the land consolidation courts (jordskifterettene) and the national insurance appeals council (trygderetten).
Decisions from the district courts can be appealed to one of six appeal courts. Each district court falls within the area of a specific appeal court.
Decisions from the appeal courts can be appealed to the Supreme court. However, leave to appeal is required in most cases, so most appeals to the Supreme court are not considered in full.
Oral proceedings are, as a rule, open to the public. The public may be excluded when sensitive matters are being discussed.
The public is entitled to access court records, records of judicial mediation, judicial rulings and statements of costs in most cases. In cases that are not heard entirely in writing, the public is also entitled to access written closing statements, evidence invoked at an oral hearing and supporting documents. This right of access does not apply to cases pursuant to the marriage Act and the Children Act and cases concerning administrative decisions on coercive measures against individuals.
Lawyers and authorised assistant lawyers may act as counsel on behalf of parties before Norwegian courts. To appear in an oral hearing before the Supreme Court, the lawyers has to be entitled to appear before the Supreme Court.
A close relative of a party may act as counsel for that party unless the court finds that person incapable. Similarly, an employee or other affiliated person may act as counsel on behalf of a business undertaking. The court may also permit another suitable person to act as counsel.
A foreign lawyer may act as counsel before a Norwegian court if the court does not object based on the nature of the case and other circumstances. Lawyers from the EU are entitled to act as counsel if they have sufficient knowledge of the Norwegian language, which is the language of the Norwegian courts.
Funding of litigation by a third-party funder is permitted in Norway.
Third-party funding is accepted in all types of cases.
Third-party funding is available for both the plaintiff and the defendant. But, since such funding usually presupposes payment to the funder of earnings from a lawsuit, a defendant only asking to be acquitted will, as a rule, not meet the requirements for third-party funding.
It is up to the third-party funder how much they want to fund.
The main costs in a lawsuit are legal fees to the lawyer(s) handling the case. Also, some court fees and costs to witnesses may be incurred. Since a party who loses a case risks having to pay the legal costs of the winning party, such costs may also be considered covered by a third-party funder.
According to the code of ethics for lawyers, Norwegian lawyers cannot agree on fees that are calculated as a percentage or share of the outcome of the case. However, no cure no pay agreements are, as a rule, accepted. Since third-party funders usually are not lawyers, they are not bound by the code of ethics for lawyers.
There are no time limits for when third-party funding should be obtained.
The Dispute Act imposes a duty to give notice in writing before bringing an action to court. The notice must contain information about the claim and the basis for the claim. However, there is no penalty for failing to comply. The case is not dismissed summarily even if no notice of claim has been sent in advance. But failing to comply could potentially be used as a basis for not awarding the plaintiff full legal costs.
A potential defendant who receives a notice of claim, is obliged to respond to the claim and the basis for the claim within a reasonable time. Failing to reply does not entail a penalty, but may be used against the defendant in the court’s decision on legal costs.
The basic limitation period for claims is three years. The limitation period starts running from the day the claimant first could have claimed payment. If a due date has been agreed, the limitation period starts on the due date. If no due date has been agreed, a claimant can in principle claim payment as soon as the claim comes into existence, even if the claimant has no knowledge of the claim or the basis for the claim. In these cases, the limitation period starts running from the day the claimant could first have claimed payment.
However, there is also a general supplementary limitation period of one year, which is counted from the first day when the claimant became aware of or should have become beware of the claim and the debtor. For claims for damages not based on contract, the limitation period is three years counted from the first day when the claimant became aware of or should have become beware of the claim and the debtor.
Norway is a party to the Lugano convention on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters. The main rule regarding jurisdiction is that defendants can only be sued in the courts of the country where they are domiciled. If defendants domiciled outside Norway are to be sued in a Norwegian court, the facts of the case have to have a sufficiently strong connection to Norway.
In certain types of cases the necessary connection is considered to be present, including:
Norwegian courts will also be competent if Norway has been agreed as a legal venue between the parties.
The initial complaint has to be in writing and has to contain the name of the court, the names and addresses of the parties, the claim made, the factual and legal grounds for the claim, the evidence that will be presented and the plaintiff’s view on the further proceedings of the case.
If the initial complaint is not in line with these formal requirements, the plaintiff is entitled to rectify the complaint within a time limit set by the court.
The initial complaint can in any event be supplemented though subsequent submissions to the court.
The courts are responsible for service of complaints to defendants. Before the conciliation board, this is done in writing using ordinary mail.
Before the district court, most parties are represented by a lawyer. Lawyers are obliged to be registered in the courts’ general portal for court cases. They are then served electronically with an order to give a written reply within a certain time limit (usually three weeks). If the defendant does not have an attorney, this order is normally sent by ordinary mail.
If the writ has been served properly and the plaintiff has requested it, the court may give a judgment in default if the defendant does not submit a defence in time. A judgment in default shall be based on the plaintiff’s arguments unless they are clearly incorrect.
The Dispute Act recognises class actions. Such actions are permitted if several legal persons have claims or obligations that are identical or substantially similar, the claims can be heard by the same court and under the same procedural rules, class action is the most appropriate method of hearing the claims and it is possible to nominate a class representative.
As a rule, class actions are opt-in, meaning that only those who are registered as class members are included. However, if the claims individually involve small amounts and do not raise issues that need to be heard individually, the court can decide that the class action will include all who do not explicitly opt out.
There is no general obligation for lawyers to provide a cost estimate. However, the code of ethics for lawyers imposes a duty on lawyers to inform clients in time if the costs of an assignment will be unreasonably high in light of the client’s economic situation or the interests at stake.
The Dispute Act has a separate section dealing with provisional security. In order to secure a monetary claim, a plaintiff may apply for arrest in the debtor’s property or other assets. In order to secure a claim for something other than the payment of money, a plaintiff may apply for an interim measure. An interim measure can order the defendant to refrain from an act, perform an act or accept an act, or can decide that an asset shall be confiscated from the defendant and taken into custody or administration.
If it is evident that a claim cannot succeed either in whole or in part, the court may, at the request of a party, rule on the claim by judgment following simplified judgment proceedings. A party cannot for other reasons apply for early judgment on some or all of the issues in dispute. However, the court may decide to split proceedings so that some claims and/or some points in dispute are heard separately.
In some cases, a claim can be rejected or dismissed without the merits being assessed. Examples can be if there is no legal venue in Norway, the parties have agreed on arbitration, or the plaintiff does not have a genuine need to have the claim decided. Such issues are normally decided before the oral hearing.
Interested parties who are not formally a party to a case, may join the proceedings through third-party intervention. Third-party intervention is permitted if that party has a real interest in one of the parties succeeding with its action. Furthermore, associations charged with promoting specific interests may intervene in cases that fall within the purpose and normal scope of the organisation.
If the plaintiff is based outside Norway and the EU, the defendant may demand that the plaintiff provides sufficient security for the potential liability to pay the defendant’s legal costs. This also applies in appeal proceedings if the appealing party is based outside Norway and the EU.
If a claim for provisional security is submitted, the courts can award legal costs based on the same provisions that apply to normal cases.
The Dispute Act stipulates that an oral hearing should be held within six months after receiving the initial complaint or appeal. In smaller courts, this time limit is usually complied with. However, in some courts, and in particular in the largest Appeal court, proceedings take more time, sometimes up to a year or even a year and a half. The possibilities for requesting urgent attention are limited, unless a request for provisional security is submitted.
The Supreme Court has stated explicitly that the Dispute Act is not based on Anglo-American concepts of disclosure and discovery. However, the parties have an obligation to ensure that the factual basis of the case is correctly and completely explained. They must provide such accounts and present such evidence as is necessary to fulfil this duty.
A party may also demand access to evidence in the possession of the other party or a third party or evidence which they can obtain possession of. When the court decides whether to issue an order to provide evidence, the court will take into consideration three main aspects. First, the evidence has to be of importance to the ruling to be made (ie, the evidence has to be relevant). Second, a request for access to evidence must be specified in such detail that is it clear as to which item of evidence the application relates. Third, the time and costs needed to provide the evidence must not be disproportionate to the importance of the evidence.
As stated above, third parties have the same obligation to provide evidence as the parties of the case. However, before the courts order a third party to provide evidence, that third-party must be given the chance to comment on the basis for the demand to access.
See 5.1 Discovery and Civil Cases.
The parties will usually submit evidence in their possession which they think is relevant. As mentioned, they also have a duty to provide such evidence as is necessary to ensure that the factual basis of the case is correctly and completely explained.
If a party wants access to further evidence in the possession of the other party, a request for access to evidence as described above has to be submitted. Even though the courts as a rule cannot enforce such orders, the failure to present evidence that a party has been ordered to present, may be used against that party when deciding what the facts of the case are.
There is a strong concept of legal privilege in Norway. All information entrusted to a lawyer is covered by this privilege. This includes correspondence to the lawyer as well as correspondence from the lawyer.
The principle of legal privilege applies to both external and in-house counsel.
There are several provisions in the Dispute Act that allow a party to not disclose a document. For instance, if a document contains information that is to be considered as entrusted to a lawyer, doctor, priest or similar professional, then the document cannot be submitted to the court unless the person entitled to confidentiality consents to the presentation of such evidence.
Evidence cannot be presented about matters that are confidential for reasons of national security or relations with a foreign state.
The same applies to documents containing trade or business secrets. The same also applies if the document contains information that is covered by a statutory duty of confidentiality of an employee of the state or a municipality. However, in these cases the court may order the document to be presented regardless of the duty of confidentiality. The court may also decide that a document has to be made available, but that certain parts of it can be censored or left out.
The Dispute Act provides for two different types of injunctive relief. In order to secure a monetary claim, a plaintiff may apply for arrest in the debtor’s property or other assets. In order to secure a claim for something other than the payment of money, a plaintiff may apply for an interim measure. An interim measure can order the respondent to refrain from an act, perform an act or accept an act, or can decide that an asset shall be confiscated from the defendant and taken into custody or administration.
In order to get an injunctive relief, two conditions have to be met. Firstly, the plaintiff has to render probable a claim. This may be a monetary claim (in which case arrest can be requested) or a claim for something other than the payment of money (in which an interim measure can be requested).
Secondly, the plaintiff has to demonstrate the need for a provisional decision from the court. Typically, this condition can be met if waiting for ordinary court proceedings will lead to a material loss.
An interim measure will, however, not be granted if the loss or inconvenience to the respondent is clearly disproportionate to the interests of the plaintiff in the interim measure being granted.
Requests for injunctive relief are handled by the ordinary courts, except for Oslo where they are handled by the Oslo county court. Such requests are to be prioritised, but there is no system with out-of-hour judges or similar. If the court agrees that an injunctive relief is required urgently, an award may be given the same day or the following day, but the main rule is that an injunctive relief is not given until an oral hearing has taken place. Depending on the case and the schedule of the court and the lawyers involved, it will often take at least a week until an oral hearing can be held.
In cases of haste, injunctive relief may be obtained without notice to the respondent. The written documents submitted to the court then have to be convincing enough for the court to make a decision without having heard the respondent.
If an injunctive relief has been awarded without notice, then the respondent may always claim a subsequent oral hearing. In such a hearing, the demand for injunctive relief is tried in full.
If an injunctive relief is set aside or lapses and it transpires that the claim submitted by the plaintiff did not exist when the relief was ordered, the plaintiff shall compensate any loss that the respondent has sustained as a result of the injunctive relief or as a result of measures that have been necessary to avoid the relief or have it set aside. The same applies if it transpires that the request was unjustified in other respects because false or misleading information on the basis for security was given in the case, either intentionally or negligently.
An injunctive relief can deal with all assets belonging to the respondent.
Injunctive relief can be obtained regardless of whether a dispute between the parties has been brought to court. And even if a dispute between two parties has been brought to court, a party may obtain injunctive relief against a third party. But if so, that third party will become a party to the injunctive relief proceedings.
If a respondent fails to comply with the terms of an injunction, this is a criminal offence which may lead to a fine or imprisonment up to six months. In addition, a failure to comply may result in a claim for damages from the plaintiff.
The Dispute Act attaches a lot of importance to the oral hearing. The written pleadings are preparatory documents. The case will be decided on what is presented during the oral hearing.
An oral hearing has three main phases. First the lawyers present the case and the relevant parts of the written evidence. The plaintiff's lawyer speaks first. The defendant's lawyer’s presentation shall preferably be limited to correcting and supplementing the plaintiff’s lawyer’s presentation.
Thereafter testimony from the parties and witnesses is heard, including any expert witnesses. The lawyers of both parties as well as the judge(s) may pose questions.
Finally, the lawyers give closing arguments.
In all civil cases, the parties are summoned to a planning meeting after the defendant has submitted a reply to the writ. This meeting is usually conducted by telephone between the judge responsible for preparing the case and the lawyers involved. In more complicated case this planning meeting can be held with the same parties being present in court.
In the planning meeting the following matters are discussed (to the extent that they are relevant in each case):
Disputes regarding requests for access to evidence are usually dealt with in writing after having received written arguments from both parties.
Jury trials are not available in civil cases in Norway. However, a party may in the district court and the appeal court demand that the court shall sit with two lay judges in addition to the professional judge(s). Since only one professional judge sits in district court cases, lay judges will constitute a majority, however, lay judges are very rarely requested by a party in civil cases.
In the appeal court three professional judges sit in oral hearings. Even if lay judges are requested in the appeal court, they will constitute a minority.
The parties can, as a rule, submit all the evidence that they consider relevant. However, the court will usually set a date for the completion of the preparatory stage of a trial. Normally this is two or three weeks before the main oral hearing. After that date, new evidence can, as a rule, not be submitted unless the other party agrees or the court accepts it, taking into account the importance of the evidence and the reason why is was not presented earlier.
Testimony from expert witnesses is permitted at oral hearings. Such witnesses are usually introduced by the parties. In some cases, the court decides to appoint an expert witness and will then also lay down a mandate for that witness.
Hearings are open to the public. If information which is covered by a duty of secrecy or other sensitive matters are discussed, then the court will usually decide to continue the proceedings in camera.
Since main oral hearing are not recorded and no transcripts are be prepared by the court, transcripts will usually not be available.
It is the duty of the parties and their lawyers to present the case. The level of activity by the judge(s) varies a lot. Some judges might not intervene at all, while other judges may have several questions to both the lawyers, the parties and the witnesses.
In some cases, procedural disputes arise during the main oral hearing. If the parties do not agree, the judge will have to give a decision. In such cases decisions are usually given after a short break so that proceedings can continue.
A judgment is usually given between two weeks and two months after the main oral hearing.
According to the Dispute Act, the main oral hearing is to take place within six months after the case was brought before the court. The district courts and the Supreme court comply quite well with this obligation. Some of the appeal courts need more time.
The duration of the main oral hearing varies a lot. In commercial disputes they can be as short as one day, and rarely exceed two weeks, but every year there are some cases that last longer than that.
Court approval is not required to settle a lawsuit.
The parties can agree that a settlement agreement should be confidential.
However, if the parties agree to an in-court settlement, then that settlement is available to the public in the same way as judgments are.
Enforcement of settlement agreements depends on the type of settlement agreement entered into. If the parties simply have entered into a settlement agreement, a party seeking to enforce this agreement must first obtain a basis for enforcement, which is usually a judgment.
However, if the parties have entered into an in-court settlement, then this settlement has the same effect as a final judgment, therefore, an in-court settlement can be used as a basis for enforcement.
Ordinary settlement agreements can be set aside based on the same rules and principles as other agreements. However, since the purpose of settlement agreements is to settle a dispute, the threshold for setting aside settlement agreement is higher than for setting aside other agreements.
This also applies to in-court settlements, but since a judge is involved as a mediator when in-court settlements are agreed and the parties usually are assisted by lawyers, it is even more difficult to set aside in-court settlements.
The award available to a successful plaintiff will depend on the claim put forward. This is often purely a monetary claim, in which case the defendant will be sentenced to pay the amount that the judge(s) find correct. But some cases deal with other types of claims. Courts may therefore also order a party for instance to hand over something or to stop a certain activity. A judgment may also establish legal status, for instance that A and not B is the owner of a real or movable property.
There are no explicit rules regarding damages in the Norwegian Dispute Act. If there is basis for claiming damages, the plaintiff is usually awarded an amount equal to the economic loss rendered probable by the plaintiff. Punitive damages are not available, but in some areas, plaintiffs may be awarded some sort of compensation for non-economic losses. Such awards are usually limited.
Delay interest may be claimed on all monetary claims that are not paid on time. Delay interest may be claimed from the due date if such a date is fixed in advance. If no due date has been fixed in advance, delay interest may be claimed from 30 days after the claimant has sent the debtor a written demand for payment.
The delay interest is not affected by any judgment between the parties. If a party is awarded a certain amount, the judgment will normally state that the defendant has to pay a certain amount “with the addition of delay interest counted from [date] until payment is made”. The “date” in the award will then be either the fixed payment date or the date 30 days after the claimant first sent a written demand for payment.
If judgments are not fulfilled voluntarily, enforcement proceedings may be initiated. The main way forward if the claimant does not have security in the form of a pledge, is that property belonging to the debtor is attached and thereafter (if necessary) sold in order to secure payment to the claimant. Another way of securing payment is to obtain the right to payroll deductions against the debtor.
Norway is a party to the Lugano convention on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters. Judgments from other countries who are a party to this convention, are therefore, as a rule, recognised in Norway and can be enforced according to mainly the same procedures as Norwegian judgments.
The conciliation boards are the formal first instance courts and are constituted of lay judges. Judgments from a conciliation board can be appealed to the district court. Judgments from a district court can be appealed to the appeal court. Judgments from an Appeal court can be appealed to the Supreme court.
Judgments from a conciliation board can be appealed without limitation. Judgments from a district court can, as a rule, be appealed, but if the amount in dispute is less than NOK250,000, leave to appeal from the appeal court is needed. Judgments from the appeal court can only be appealed if leave to appeal to the Supreme court is given. This requires that the appeal concerns issues that are of significance beyond the scope of the current case or if it is important for other reasons that the case is decided by the Supreme court.
A judgment has to be appealed within one month after the judgment was served on the party wanting to appeal. Appeals have to be submitted electronically to the courts’ portal, where all attorneys wanting to act as counsel have to be registered.
The appeal court may retry the decision of the previous instance in full, but only to the extent that the decision has been appealed. New evidence and new arguments may be presented.
When the Supreme court gives leave to appeal, the leave may be limited so that only parts of the appeal court judgment is considered during the appeal hearing.
The appellate court will dismiss the appeal if it is not successful. The appellate court may also set aside the judgment that has been appealed, typically if there have been procedural errors in the previous instance. If the appellate court agrees with the appealing party in full or partly, a new judgment is given based on the appellate court’s view of the case.
As a starting point, each party has to cover its own legal costs such as expenses and attorney’s fees. Furthermore, the plaintiff is responsible for paying a court fee, the size of which depends on how many days the oral hearing lasts. However, each party may claim costs of litigation covered by the other party.
The most important factor for the court when awarding costs, is the outcome of the dispute.
If one party can be said to have won “in the whole or in the main”, then that party is, as a rule, awarded full litigation costs from the losing party. Exceptions may be made, releasing the losing party from this obligation in part or in full. When considering whether such an exception is to be made, the court will consider whether there was just cause to have the case heard, whether the successful party can be reproached for bringing the action, whether the party has rejected a reasonable offer of settlement and whether the case is important to the welfare of the party and the relative strength of the parties justifies an exemption.
If legal costs are awarded, such costs have to be paid within two weeks. If the costs are not paid, delay interest accrues automatically. The delay interest is fixed by the government every six months. The delay interest for the second half of 2020 is 8% per year.
According to the Dispute Act, judicial mediation is offered to the parties in all disputes. Here, a judge acts as a judicial mediator. If the parties agree to judicial mediation, the case is amicably settled more often than not. But if the case is not settled, the judicial mediator cannot be involved in the subsequent handling of the case by the court.
Within the construction industry the parties often agree on various types of alternative dispute resolution mechanisms. There is also a system in place whereby attorneys can be certified as mediators.
A party cannot be forced to take part in mediation proceedings. The only sanction that may imposed on a party that refuses to mediate, is that the court may take this reluctance into account when deciding the question of legal costs.
There are only a few institutions in Norway that offer and promote ADR. This is an area under development.
The Norwegian Arbitration Act is based on UNCITRAL’s model law for international arbitration. Unless the parties have agreed otherwise, arbitration proceedings are carried out in accordance with the Arbitration Act.
According to Section 9 of the Arbitration Act, the parties may refer to arbitration any disputes concerning legal relationships in respect of which the parties have an unrestricted right of disposition. In some cases, public considerations limit the parties' rights of disposition. As examples can be mentioned cases relating to matters of personal status and legal capacity, the legal status of children pursuant to the Children Act and administrative decisions on coercive measures. The private law effects of competition law may, however, be tried by arbitration.
Based on Section 43 of the Arbitration Act, an arbitration award may only be challenged on the following grounds:
An action to set aside an arbitration award has to be put forward within three months after the arbitration award was received by that party.
Norway is a party to the New York Convention 10 June 1958 on the Recognition and Enforcement of Foreign Arbitral Awards. This means that both domestic and foreign arbitration awards are recognised and enforceable in Norway in the same way as other final judgments from the ordinary Norwegian courts. An enforcement proceeding starts with a written submission to the relevant enforcement authority.
The Dispute Act came into force 1 January 2008. There are no plans for a major reform of this act.
However, there are discussions regarding the number of district courts in Norway. The Courts Administration had suggested to reduce the number of district courts considerably, but this has been dismissed by Parliament. Now, other options are being considered.
During the spring of 2020, COVID-19 lead to the postponement of many oral proceedings. The government also issued new regulations allowing for oral proceedings to be carried out by video link instead of the parties and witnesses being present in court.
COVID-19 has led to a backlog of cases in many courts. The government has therefore hired judges on a temporary basis in order to reduce the backlog.
COVID-19 has not led to any new legislation suspending or prolonging limitation periods.