Introduction

Hamburg custom is a term that has a specific meaning in German legal practice, especially in connection with cease-and-desist declarations. It is a special type of contractual penalty that can be included in cease-and-desist declarations. In this article, we will examine the Hamburg custom in cease-and-desist letters in detail, explain its legal basis, and highlight the advantages and disadvantages of this practice.

What is a cease and desist letter?

A cease-and-desist declaration is a legal promise to refrain from a certain behavior in the future. It is often used in cases of competition infringement, copyright infringement, or other rights violations. By issuing a cease-and-desist declaration, the infringer undertakes not to repeat the offending conduct and thus often avoids legal proceedings.

The Hamburg custom in cease and desist letters

In this context, the Hamburg custom refers to a specific type of contractual penalty that may be included in cease-and-desist declarations. According to the Hamburg custom, the debtor undertakes to pay a contractual penalty in the event of a breach of the cease-and-desist declaration, the amount of which is determined by the creditor at its reasonable discretion and may be reviewed by the competent court in the event of a dispute.

Legal basis

The Hamburg custom is anchored in Section 315 of the German Civil Code (BGB), which governs the determination of performance by a party. According to this provision, if the performance is to be determined by one of the contracting parties, the discretion shall be exercised on an equitable basis. In the case of a cease-and-desist declaration, this means that the amount of the contractual penalty must be reasonable.

Application of the Hamburg custom

In practice, the Hamburg custom is often used in cease-and-desist letters to achieve a deterrent effect. The debtor knows that in the event of a breach, a penalty will be due, the amount of which will be determined by the creditor. This may deter the debtor from repeating the offending conduct.

Advantages and disadvantages of the Hamburg custom

Advantages

• Flexibility: The Hamburg custom allows the amount of the contractual penalty to be adapted to the individual case.
• Deterrence: Uncertainty about the amount of the contractual penalty can act as a deterrent.

Disadvantages

• Legal uncertainty: It can be uncertain for the debtor not to know what contractual penalty will be due in the event of a breach.
• Potential disproportionality: There is a risk that the penalty set by the creditor is disproportionate, which may result in an unfair burden on the debtor.

Judicial review

It is important to note that the contractual penalty established by the Hamburg custom is not inviolable. The debtor has the right to have the appropriateness of the contractual penalty reviewed by a court. The court will examine whether the contractual penalty was set at an equitable discretion and whether it is in line with the principles of proportionality.

Practical considerations

When using the Hamburg custom in cease-and-desist letters, it is advisable to establish clear criteria for setting the contractual penalty. This can help avoid disputes over the appropriateness of the contractual penalty and ensure that it serves as an effective means of enforcing the cease-and-desist letter.

Conclusion

Hamburg custom is an important tool in the context of cease-and-desist letters that offers flexibility but can also be fraught with uncertainty. It is important to be careful when using Hamburger Brauch and to ensure that the penalty is proportionate to the seriousness of the violation. The opportunity for judicial review provides an important safeguard to ensure that the Hamburg custom is applied fairly and in accordance with the principles of civil law.