Civil process is increasingly expensive

With the draft amendment of the Civil Procedure Code, the bill introducing substantial changes to the Civil Costs Act was submitted to the Legislative Office of the Sejm Chancellery.

The Ministry of Justice decided to try to increase the costs of the process and raise many fees. The rationale for such steps is that "the system of the costs of judicial fees in civil matters requires adaptation to the current economic realities and purchasing power of money". In short – fees go up.

Below we briefly describe the most important of the planned changes.

1. The fixed fee shall be charged in non-mandatory rights cases and in certain property rights cases referred to in the Act shall be equal, irrespective of the value of the object of the dispute or the value of the object of the appeal. The fixed fee will not be lower than 30 PLN and higher than 10,000 PLN (currently 5,000 PLN).
2. Relationship charge in property rights cases, currently applicable 5% the value of the subject matter or subject matter of appeal shall be amended in such a way that, depending on the amount of the claim in question, it will be:

• up to 250 PLN – 30 PLN;

• above 250 PLN to 500 PLN – 100 PLN;

• above 500 PLN to 1,000 PLN – 150 PLN;

• above 1,000 PLN to 2,000 PLN – 200 PLN;

• above 2,000 PLN to 4,000 PLN – 300 PLN;

• above 4,000 PLN to 6,000 PLN – 400 PLN;

• above 6,000 PLN to 8,000 PLN – 500 PLN;

• above 8,000 PLN to 10,000 PLN – 600 PLN;

• above 10,000 PLN to 12,500 PLN – 700 PLN;

• above 12,500 PLN to 15,000 PLN – 800 PLN;

• above 15,000 PLN to 18,000 PLN – 900 PLN;

• above 18,000 PLN to 20,000 PLN – 1,000 PLN;

• above 20,000 PLN to 4,000,000 PLN – 5% amounts;

• above 4,000,000 PLN – 200,000 PLN and 0.5% above 4,000,000 PLN, no more than 500,000 PLN.

To date, the maximum relative fee was 100,000 PLN, Therefore, if the bill is adopted, it will be increased as much as five times.

1. From one quarter up to half of the amount of the fee will be raised the fee on the application in the order procedure.
2. From 40 to 100 PLN a fixed fee of:

• the order to dismiss the application to exclude the judge or juror;

• orders to sentence the party, witness, expert, translator or other person to a fine and to refuse immunity from the fine;
• decisions on the forced bringing or arrest of a witness and the refusal to exempt from forced entry;
• the remuneration and reimbursement of the costs incurred by the expert, translator and curator;
• the decision on the claim of the witness;
• a request to initiate a non-trial procedure or an independent part thereof, unless otherwise specified in the special provision;
• appeals, complaints, cassation proceedings, reopening proceedings and actions for the finding of non-compliance with the law of a final judgment in a case in which the non-trial proceedings were initiated ex officio;
• the application for proof security.

1. A fixed fee will be introduced 100 PLN from a request for service of a judgment or order with a justification notified within one week of the date of notification of that decision or order.
2. From 2,000 to 5,000 PLN a fixed fee will be raised on the application for:

• winding up the company;

• exclusion from the company;

• repealing the resolution of shareholders or the resolution of the general meeting of the company;
• annul the resolution of shareholders or the resolution of the general meeting of the company;
• establishing the existence or non-existence of a resolution of the body of the company;
• repealing the resolution of the meeting of bondholders;
• annul the resolution of the meeting of bondholders.

1. A fixed fee of the amount of 100 PLN per person for the application for a request for a witness, expert or party to a trial, if the application has been submitted after the approval of the trial plan (the plan of the hearing is to be amended by the Code of Civil Procedure), and if a compulsory removal of the witness or expert is required, that amount shall be 200 PLN.
2. To 100 PLN a fee related to certain applications for a lien and the granting, amendment or revocation of the security of the claim shall be raised.

The amendments proposed in connection with the reform of the Civil Procedure Code introduce a real revolution in the current Law on Judicial Costs in Civil Procedure.

In the present system, it is often the case that the entity is unable to bear the burden of the charge on the action, and if the bill is passed by the Sejm, these fees will increase significantly. For a maximum rate of five times.

Since it is already popular to buy out claims from individuals who simply cannot afford to assert their rights, it is easy to predict the consequences of the changes described. As a result, even more people will be forced to sell their claims, often for a small percentage of their value.

The debtors will have the opportunity to use the situation through deliberate delay or even non-compliance.

All of this will lead to a breach of the security of trade and will put the State Treasury at risk for significant losses as a result of complaints to the European Court of Justice to restrict the State's right of access to the court.

second An important problem is the substantial increase in the charges on internal company actions and the introduction of fees for such widespread procedural activities as the application for an expert or a subpoena for a witness hearing. In small cases, this can significantly affect the course of the process by dissuadeing the parties from having a fair share of the evidence and, as a result, leading to a misidentification of the facts by the courts.

In conclusion, it is difficult to admit that the draft amendment to the cost law can actually have a positive effect on speeding up the procedure, while it will certainly hinder access to the court by smaller entities.

Written by Rafał Czepik. Legal advisor, graduate of the Faculty of Law at the University of Warsaw, specialist in economic and civil law.