The Financial Ombudsman has already pointed out the problem of researching the conditions for abusing contractual terms last year. The positions of the courts were not uniform in this respect and often had an adverse effect on consumers. The Supreme Court replied to the doubts raised by the Ombudsman, thus simplifying the case law in question.
On 20 June 2018 Supreme Court 7 Judges adopted a resolution responding to the Financial Ombudsman’s question: ‘Is it based on Article 3851i 3852k.c., the examination, in the event of a review, of the conditions of conformity with good manners and of gross violation of the consumer’s interests — i.e.
of the unfair (abuse) nature of the contract — shall be carried out in accordance with the condition of the conclusion of the contract, taking into account its normative content, taking into account the circumstances of its conclusion and the reference, at the time of its conclusion, to other conditions of that contract or of another agreement on which it is dependent, or shall that assessment be made taking into account the application (execution) of the contract under review in practice, during the period from the date of its conclusion until judgment?
” In this resolution, the signature case III CZP 29/17, The Supreme Court stated that ‘Assessing whether a contractual arrangement is prohibited (Article 3851(1) k.c.), shall be carried out as at the time of conclusion of the contract.’
„Assessment of whether a contractual arrangement is not permitted (Article 3851(1) k.c.), shall be carried out at the time of conclusion of the contract.’
In its proposal dated 3 April 2017, The Financial Ombudsman pointed out that the case law on the manner of the examination in the examination of the incidental grounds for the abuzzability of the contractual provisions remained inconsistent. The absence of the consequences of the judicature in this area was apparent, in particular, in the light of disputes arising from contracts concluded by financial market operators with consumers, and thus in particular credit agreements concluded with banks.
As is apparent from the justification of the Financial Ombudsman’s request, the problem of the discrepancy of case law has its origin, among other things, in the wrong translation Article 4(1) Directive 93/13 to 5 April 1993 on unfair terms in consumer contracts.
In the Polish translation of the directive, the wording of this provision indicated that the examination of the abuzzness of the clause should be made with reference, at the time of performance of the contract, to any circumstances related to performance of the contract.
In the meantime, reading the English and German versions of this provision led to different conclusions, as it refers to the moment of conclusion of the contract and the circumstances accompanying the conclusion of the contract.
So until the warehouse issues 7 Judges of the Supreme Court dated 20 June 2017 part of the courts held that the infringement Article 3851k.c.
it consists in itself of shaping the content of the contract in such a way that the interests of the consumer are affected and, consequently, only the state of the matter of the date of the legal act, i.e. the conclusion of the contract, should be taken into account.
For example, the judgment of the Court of Appeal in Łódź – 1st Civil Division corresponds to this thesis dated 30 April 2014, reference no.
I ACa 1209/13, in the explanatory memorandum of which the court states that ‘The legality of the application of individual clauses in a specific contract shall be examined only in the event of a review, taking into account the provisions of the entire agreement, the distribution of the rights and obligations of the parties.
However, it should, of its essence, be made for the moment of the conclusion of the agreement, because from that point on it becomes permissible.
Therefore, in the recipe Article 3852k.(c) the legislator has provided for an assessment of the abusability of the contract at the time of the conclusion of the consumer contract.’ Importantly, such an approach to the matter causes ex tunc and ex lege to have an effect in the form of an abstraction of a given provision, while the judgment given is purely declaratory.
On the other hand, However, the parties have so far had some representatives of the judicature, despite the clear wording of the provision Article 3852k.c., took the view that the inclusion in the pattern of an unauthorised provision does not necessarily mean that it is illegal to apply it, since practice and implementation of a specific provision are still important.
With this approach, for example, thesis contained in the judgment of the District Court in Łódź corresponds dated 10 November 2016, reference no. III Ca 775/16 – „Even if we examine the abuzziness for the moment of the conclusion of the contract, this element cannot be underestimated by the prism of performance of the contract.
It is clear that a fair and complete assessment could not have taken place since the performance of the contract, in particular that the plaintiffs made a request several years after the conclusion of the credit agreement.
Thus, an important element in assessing the claim submitted, beyond the content of the contract itself, is how the actual provisions of the agreement shaped the situation of the parties to the credit agreement." The Financial Ombudsman's request presents and describes a number of relevant rulings confirming the existence of a discrepancy in the doctrine.
This. second The approach, of course, may have led to solutions that were not beneficial to consumers.
The Courts concluded that although point (e) the relative wording of the contractual provision would indicate its abuzzivity, but as a result of the application of the said provision, the consumer did not suffer any damage, or did not prove that it suffered any damage.
An example of such interpretation is the judgment of the District Court in Łódź dated 7 March 2016, reference no. III Ca 1706/15 and judgment of the District Court of Łódź dated 27 October 2015, reference no.
III Ca 967/15, in which the courts held that the concept of the interest of the reasons must refer to the circumstances of both the conclusion and the execution of specific credit agreements.
It is therefore clear from both judgments that the courts investigating the cases combined the conditions of absolution with the circumstances relating to the performance of the contract.
The courts therefore failed to examine whether the content of the contract resulted in a disproportion of business rights in relation to obligations to the detriment of consumers, but placed a burden on consumers to prove that their business activity actually harmed them.
At this point it is worth pointing out that the subject of these judgments was a modification clause containing the conditions for the change in the interest rate on mortgage loans. Mortgage credit agreements often contain provisions allowing the bank to set interest rates on the basis of non-precise and non-verifiable criteria.
As a result of the resolution adopted by the SN, the court will assess the content and circumstances of the conclusion of the contract only in the course of the review of the incidental contractual provision.
Therefore, the consumer will not have to demonstrate that the bank has indeed, on the basis of the contractual provisions, freely overstated the interest rate which has caused damage to the consumer.
Otherwise, it would be necessary for the consumer to calculate, in the course of the legal proceedings, if the interest paid by him was higher than would have been the case with clear criteria.
Showing the abuzz of the provision would therefore require the involvement of a financial expert, which would, of course, entail higher costs and an extension of the procedure.
In accordance with the resolution 7 SN judges dated 20 June 2018, reference no. III CZP 29/17 an assessment of the absolution of the contractual provision simply requires an analysis of the content of the contract
In conclusion, according to the resolution 7 SN judges dated 20 June 2018, reference no. III CZP 29/17 an assessment of the abuzzness of the contractual provision simply requires an analysis of the content of the contract.
Whether a specific contractual arrangement is not permitted determines the content of the contract as it is at the time of its conclusion. Absence of a contractual arrangement shall not invalidate the subsequent application of the contract.
This ruling is of paramount importance to consumers, who are always the weaker party to the contract. Consequently, the Court of First Instance’s understanding Article 3851(1) k.c.
consumers will not have to prove in the course of legal proceedings that the unlawful contractual arrangement has actually been used by the entrepreneur and has caused damage to them. This will clearly simplify the procedure, as it will reduce the number of hearings and reduce the number of evidence required.
The Supreme Court resolution is of crucial importance to all consumers who, in disputes before the courts, seek to establish the ineffectiveness of the provisions contained in the contracts, citing their abusive nature. This resolution will certainly contribute to the unification of the case law of the common courts.
Author:
Michał Wasilenko
Lawyer, Associate in the Legal Department, member of the Regional Bar Council in Lublin, graduate of the Faculty of Law and Administration at Maria Curie-Skłodowska University in Lublin. He specializes in commercial and civil law law.