litigation | In Principle

In the course of a construction dispute, to prove certain facts the parties most often request the examination of evidence not only from documents, but also submit numerous requests to hear witness testimony. However, according to parliamentary findings, witness testimony tends to increase the length and cost of court proceedings, and also allows for procedural manipulations. Therefore, the parliament restricted the admissibility of witness testimony in commercial proceedings. This has had an impact on the day-to-day operations of companies.

The investor and the general contractor are jointly and severally liable for the subcontractors’ fees. However, this does not automatically mean that the provisions of the agreement between the subcontractor and the general contractor will apply directly to the investor. A particular provision is an arbitration clause determining the method for pursuing claims. If the general contractor and the subcontractor have agreed to arbitration, can the subcontractor pursue the investor in arbitration as well, or must the subcontractor file suit in state court?

From August 2019, the fee for an application for interim relief to secure a monetary claim (e.g. for payment of a specific sum of money) made before a legal action is brought to court has increased significantly. Instead of PLN 100, the fee is equal to one-fourth of the fee that would be payable in a suit on the claim (maximum PLN 50,000). Under certain conditions, the fee for an application for interim relief will be set off against the fee on the document instituting the principal proceeding (statement of claim). However, the provisions allowing for this possibility may give rise to problems of interpretation, and thus the need to incur additional costs.

A hard Brexit would leave choice of law rules largely intact, but remove the UK from convenient EU procedures for recognition and enforcement of judgments.

The Supreme Court of Poland has presented to an expanded panel legal questions concerning a summons to attempt a settlement as an action interrupting the limitations period on a claim.

In the judgment of 26 April 2019 (case no. V CSK 80/18), the Supreme Court of Poland held that it is not contrary to the nature of a construction contract to condition the payment of fees on the absence of defects in the structure. Therefore, the parties’ terms requiring payment only after a faultless handover protocol has been obtained are permissible. However, in the Supreme Court’s opinion, such objections may also be included in the terms of the handover protocol. The court approved the possibility for the parties to invoke reservations made in the handover protocol, which constitute additional provisions in relation to the contract.

In a judgment involving compensation under an insurance policy, the Supreme Court of Poland has held that a pro rata provision was invalid because it was disadvantageous to the insured and was included in the insurance conditions unilaterally by the insurer as the party with the stronger contractual position.

The Supreme Court of Poland has recently issued several rulings on setoff (Civil Code Art. 498), confirming the existing line of case law and the established legal and commercial practice. The regulations on asserting the defence of setoff in civil proceedings have also been amended.

The amendment of Poland’s Civil Procedure Code which entered into force on 7 November 2019 changed certain provisions on the formal requirements for pleadings and the consequences of failure to meet these requirements. Harsh rules, uncertainty on the proper method of curing formal defects, and varying practices of the courts may result in final rejection of a pleading and loss of the case for seemingly trivial reasons. Professional attorneys must exercise particular caution.

It is permissible to agree on a contractual penalty for non-payment or late payment of fees due to subcontractors, the Supreme Court of Poland held in its resolution of 30 June 2020 (case no. III CZP 67/19).

Even before a state of epidemic threat was announced, some businesses anticipating the probable impact of the approaching pandemic decided to take out business interruption insurance. But can this type of coverage make up for at least some of the losses due to the pandemic?

On 2 July 2019, at the Hague Conference on Private International Law, the conclusion of a new international convention was announced: the Hague Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters. It complements the 2005 Hague Convention on Choice of Court Agreements.