The time limitation period prescribed by law for claims may be under Polish law broken by an action taken in order to enforce the claim. It is accepted that one of such actions is a formal request for settlement in front of a court. This method is often attractive as the costs are marginal, does not expose the initiating party to the costs of full trial nor to the risk of losing the case. It is also not as damaging to the relations between the parties as the litigation and yet help to freeze claims for some time, allowing their later litigation when it suits the initiating party better.
Usage of this method in cross border cases may be subject to misunderstandings and doubts. It is an instrument based on the Polish Civil Proceedings Code (“CPC”). The art. 185 of the CPC states that regardless of the specific rules on the competence over the matter, the court in which district the seat of the other party is situated, is the appropriate forum. However what if the seat of the other party is abroad? Are the choice of court agreements also applicable to such settlement requests?
Clearly, the procedure applicable in Polish court cannot be used in other courts even if the Polish law would be applicable on the merits of the claim, so the territorial competence over the other party’s seat would have limit the usage of this method only to parties based in Poland. However, the procedure can indeed be used in cross border cases, but it is not the art. 185 CPC which is the first to refer to in order to determine if it can be used in the given case, even if it prima facie looks as determining the relevant forum. But it merely dictates the court territorially appropriate and does not govern the more fundamental question of international jurisdiction. Hence, firstly, the Polish courts have to have jurisdiction over the matter and only then the relevant district court may be defined by looking at art. 185 CPC. But is the indication of the relevant court in art. 185 CPC applicable in case of parties based abroad?
The Polish Supreme Court stated in the case III CZP 3/14 that rules on national jurisdiction are applicable in the proceedings under the request for settlement. The Court stated in its reasoning that these proceedings are a separate type of proceedings of independent nature, corresponding to proceedings on the merits. This type of proceedings, similarly as litigation, serves the possibility of handling a case before the court, but by reaching a settlement under the court supervision. The Court also stated that filing a settlement request mirrors the situation in which a claim is filed.
This reasoning should arguably also speak for the possibility of applying the choice of court agreement made by the parties to this type of proceedings, disregarding the general domicile rule stated in art. 185 CPC. If the parties have agreed which court has jurisdiction over the disputes arising from their relation, the rule of art 185 CPC will not apply despite the apparent disregard by that provision of the competence on the merits of the case.
Of course, the final goal of using this method in front of a Polish court, which is much more often only the break of the time limitation period rather than genuine settlement attempt, will only be of use if the Polish law governs the merits of the underlying claims.
Contact
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Tel: +48 58 712 85 45
