State liability for judicial errors in EEA law – the end of the Dartride saga?

On June 5th 2025, the EFTA Court handed down an advisory opinion requested by the Eidsivating Court of Appeal where it ruled that the principle of state liability attributable to the judiciary as established by the Court of Justice of the European Union in Köbler is part of EEA law. The aim of this blogpost is to summarise the legal reasoning of the EFTA Court and offer a view on how this principle should be applied in EEA law and what differences in interpretation (if any) are warranted.

Author: Jakub Svoboda, LL.M. student of EU and EEA law at the University of Bergen

1. Overview of the proceedings before Norwegian courts

The dispute in the main proceedings concerned a taxi company which applied for permits necessary to provide its services in Oslo. Its application being denied by the municipality, Dartride sued the municipality for damages for the alleged losses caused by what it considered to be a manifest breach of EEA law. The Oslo City Court ruled in favour of the municipality, however, holding that Dartride could not prove any loss of profit. The judgment was appealed to the Court of Appeal for the Oslo region (Borgarting), but here the case was dismissed as being brought against the wrong defendant. According to the Court of Appeal, the dominant cause of the alleged loss had to be considered the Norwegian legislation in force at the time and that could not be attributed to the municipality. Dartride requested leave to appeal to the Supreme Court, arguing that the principle of State liability for violations of EEA law must give it the right to bring its case against the public entity responsible for the handling of its request for the sought permit. If the Norwegian legislation in place really was in conflict with Article 31 EEA (something which Dartride disputed), then the municipality was obliged by Protocol 35 EEA to let Article 31 EEA prevail. Leave to appeal was denied, however, without the Appeal Selection Committee of the Supreme Court going into Dartride’s arguments.

Dartride then proceeded to sue the Norwegian State, as suggested by the Court of Appeal, but this action was dismissed by both the City Court and the Court of Appeal as being time-barred. Dartride argued that it had to be excused for not having filed a claim against the State earlier as it had considered it obvious that the municipality was the right defendant, but in vain. Again, leave to appeal to the Supreme Court was denied.

Unwilling to give up, Dartride sued the Norwegian State again, but this time based on the view that the order from the Court of Appeal dismissing its original action against the municipality constituted a manifest breach of EEA law. This claim was not time-barred, but the City Court ruled that there is no basis for State liability for judicial wrongs under EEA law. Dartride’s plea for an advisory opinion from the EFTA Court was rejected.

In the so-far eight(!) round of proceedings, Dartride appealed the City Court’s judgment and requested the case to be moved to another appellate court than the one being charged with having violated EEA law. The case was moved to the neighbouring Eidsivating Court of Appeal, which decided to request an advisory opinion from the EFTA Court.

2. Questions referred

The Eidsivating Court of Appeal referred the following questions to the EFTA Court:

(i)    Does the principle of state liability in EEA law apply to errors made by the courts?

(ii)   If so,

a. Which decisions trigger such liability?

b. Is it possible to make a claim for such damages subject to additional conditions imposed by third paragraph of Section 200 of the Courts of Justice Act?

3. Reasoning of the EFTA Court

3. 1 Question 1

In line with the principle of homogeneity, the EFTA Court (‘the Court’) relied on the decision of the Court of Justice in Köbler. The Court refers to its earlier decision in Sveinbjörnsdóttir recognising State liability in general (para. 28) and to the principle of loyalty enshrined in Article 3 of the EEA Agreement (para. 29). In particular, it stressed that equal protection of rights under EU and EEA law requires all individuals and economic operators to have redress against a decision of a court of last instance which infringed their rights and therefore it sees no reason to conclude that the principle of State liability should be narrower under EEA law than under EU law; the opposite conclusion would lead to a gap in protection of rights in the respective pillars (para. 34).

The Court went on to address the concerns of the EEA EFTA States. Their main arguments against the existence of State liability attributable to the judiciary in EEA law were that State liability for judicial decisions is

(i.) inseparably linked to the obligation to refer under EU law (Article 267 TFEU),

(ii.)   incompatible with res judicata,

(iii.)  undermining of judicial independence and that

(iv.)  existing remedies under EEA and national law are sufficient.

Firstly, the Court points out that compliance with the duty to refer is only one of the criteria used in assessing the seriousness of the breach of EEA law; it does not follow that it constitutes a necessary condition for State liability for judicial wrongs (para. 36). Secondly, the res judicata status of judgments of courts of last instance is not violated because the State is made liable, not the court or the individual judge and, more importantly, State liability does not require annulment of the decision but ‘merely’ a compensation for it (para. 39).

Regarding independence of the judiciary, the EEA EFTA states made reference to Recital 15 and Article 106 of the EEA Agreement dealing with the need for uniform interpretation of the Agreement in full deference to the independence of the courts. The Court recognises the importance of judicial independence but reiterates that to achieve a homogenous EEA, its own case law must be adjusted in line with the Court of Justice unless there are compelling grounds for divergence in interpretation (para. 45). Therefore, the Court states that those provisions cannot be understood as precluding state liability for judicial errors in EEA law (para. 46).

As for the argument that existing remedies are sufficient (e.g. homogeneity or the possibility to reopen cases), the Court points out that the same could be said about the EU pillar and yet the Court of Justice recognised State liability for judicial errors. It also refers to ESA’s argument that the absence of a duty to request advisory opinions from the EFTA Court underscores the necessity for such a principle in the EFTA pillar (para. 57).

Other arguments put forward by the EEA EFTA States – the principle only makes sense in systems with federal characteristics and that it is difficult to determine a competent court – are also rejected. The first question is therefore answered in the affirmative – the principle of State liability in EEA law applies also to judicial errors.

3.2 Question 2a

In answer to this question, the Court refers to the already established conditions of State liability – infringed rule must confer rights to individuals, breach must be sufficiently serious, and a direct causal link must exist between the breach and the damage – and states that the same conditions apply for State liability for judicial errors (para. 63). It then goes on to focus on the assessment of seriousness of the breach.

Referring to the special nature of the judiciary, the Court states that State liability for judicial errors must be triggered only on exceptional basis and only if the court in question manifestly infringed EEA law (para. 64). While all relevant factors must be taken into account, particular attention should be paid to the degree of clarity of the infringed provision, whether the error is excusable, whether the advisory opinion mechanism was used and (when applicable) the position of the position taken by an EEA or EU institution (para. 66). A breach is to always be considered sufficiently serious when a decision is made in manifest breach of the relevant case law of the EFTA Court or the Court of Justice (para. 68).

The referring court also sought guidance on the interpretation of the term ‘decision made by national court adjudicating at last instance’, since Dartride claimed damages for a decision of a Court of Appeal and not the Supreme Court. The EFTA Court reiterates that that condition refers to a decision against which there is no judicial remedy under national law (para. 72). However, it states that since Dartride’s leave of appeal was denied by the Supreme Court, all national remedies have been exhausted, and this condition is satisfied (para. 74).

The answer to the question 2a therefore is that State liability for judicial errors in EEA law can be incurred only in exceptional circumstances when the court manifestly infringed EU law and all judicial remedies under national law have been exhausted.

3.3 Question 2b

The Court states that it follows from the conditions in third paragraph of Section 200 of the Norwegian Courts of Justice Act that an action for damages against a judicial decision cannot be brought unless (a) the decision has been quashed or amended, (b) the decision has lapsed without the possibility of a timely appeal to be heard or adjudicated upon or (c) the public official is convicted of a criminal offence in relation to the decision. The Court refers to the principle of national procedural autonomy and the conditions of equivalence and effectiveness of the available remedies (para. 79). It nevertheless goes on to conclude that State liability for judicial errors cannot be subject to additional conditions such as those in third paragraph of Section 200 of Courts of Justice Act since they are stricter than the manifest infringement requirement and will deprive the principle of any meaningful effect (para. 86).

The answer to this question therefore is that national legislation cannot exclude State liability for judicial errors by imposing additional conditions such as those at issue in the main proceedings.

4. Application and possible divergencies in interpretation

The Court ruled in Karlsson that the application of the State liability principles in EU and EEA law ‘may not necessarily be in all respects coextensive’. This section offers an opinion as to how the condition of ‘manifest infringement’ might be interpreted in EEA law in relation to judicial errors and how (if at all) the interpretation might differ from the EU pillar and why.

The most striking difference between the two pillars in relation to judiciary is that the courts of last instance in the EEA EFTA States do not have the duty to refer questions to the EFTA Court and when they choose to do so, the resultant advisory opinions are not binding on them. Does this difference in institutional setup change anything on the level of threshold required to trigger State liability for judicial decisions?

If the voluntary nature of the advisory opinion procedure is to be preserved, EEA EFTA States cannot be indirectly forced to refer questions to the EFTA Court on the pain of being liable for incorrect application of EEA law, even if the provision in question did not seem unclear to the national court and in its opinion did not require such referral. On the other hand, the level of protection of rights has to be the same throughout the whole EEA. In Köbler (para. 123), the ECJ stated that even though the referring court ought to have maintained its request for preliminary ruling, such omission is not by itself sufficient for the infringement of EU law to be manifest. Similarly, a decision not to refer a question to the EFTA Court should not have a decisive influence on the conclusion about the degree of infringement of EEA law. In my view, the fact that a national court of an EEA EFTA state has not made use of the advisory opinion procedure should matter even less in the assessment of the degree of infringement than violation of the duty to refer does in the EU pillar. It certainly cannot result in a manifest infringement on its own. However, a national court should always be considered to have manifestly infringed EEA law if the answer to the substantially same question has already been answered by the EFTA Court or the Court of Justice.

The transferral of the principle of State liability attributable to the judiciary into EEA law is an important step in assuring equal protection of right throughout the whole EEA. At the same time, it is important to respect the differences in institutional setup. While they do not prevent the transferral of the principle itself, they might place limits on the application of the principle in EEA law by putting less emphasis on whether a question was referred in the EFTA pillar than in the EU pillar.

The Dartride saga continues in before Norwegian courts. It will be interesting to see how it ends. 

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How to cite

Svoboda, Jakub (2025): State liability for judicial errors in EEA law – the end of the Dartride saga? Blog. EFTA-Studies.org.