A single borrower, standing alone in a confrontation with the bank, is simply a clear situation. But life can be much more complicated. Young spouses who have taken a debt with their parents, a divorced couple, or even an heir to a deceased borrower – each of these situations raises the question whether all of them must be active in a court case. The banks would like to require all borrowers to participate in the cancellation process. Is this, however, a legal sanction that is humanly just?
In the celebrated judgement of the TEU in Case C-260/18 of October 2019, that is, in the alleged Polish – Dziubakow State case, it was decided that the abusive clauses in credit agreements valorised to abroad currency must be eliminated from the agreement and the court cannot complete this gap. As a result, the agreement falls and should be annulled, as there are no longer rules on the conversion of the amount of credit and instalment into abroad currency.
This landmark judgement opened the door to fighting for its rights to the borrowers holding loans linked to abroad currency – in the vast majority of Swiss francs, but besides in the euro currency, US dollars or nipponese yen. The main direction of these cases and the anticipation in the judgement was that the court declared the credit agreement invalid, but over the years, further issues related to this subject arose (and proceed to arise).
Among many issues in both substantive law and civilian procedure, there is simply a problem in court practice that boils down to the beginning question: how many reasons do you request to cancel the credit agreement?
The case is clear, of course, erstwhile 1 individual enters into a credit agreement, pays off the instalments and then decides to take a judicial action against the bank. Life, however, is not always that simple.
More than 1 borrower
Along with a wave of fresh lawsuits following the judgement of the TEUJE ws. The courts had to deal reasonably rapidly with the ‘problem’ of cases where the list of borrowers on the contract did not agree with the list of reasons for the annulment of the contract.
It may be that young spouses have taken credit together with the parents of 1 of them or another associate of the family, due to the fact that they heard in the bank that they themselves do not have creditworthiness. It may be that the spouses have taken out a debt "shared and in agreement", but they are presently divorced and the credit is repaid only 1 of them, and there is no agreement. It may besides be that the borrower took out the debt on his own – but he died before the debt could be repaid and the commitment was taken over by the heirs, not necessarily wanting to cooperate with each other. And there is 1 determined individual among those individuals to cancel the contract. He orders the attorney, the suit goes to court.
How's it been so far?
In all these cases, banks saw rather rapidly the possible to cast proverbial logs and began to assert rather widely that all borrowers had to participate together in the cancellation case. The courts, in the majority of cases, have applied Article 195 of the civilian Procedure Code. So they first obliged to indicate the names and addresses of all another borrowers and then to notify them of the ongoing process and the anticipation of entering it as a plaintiff. precisely – only about the "possibility" of entering, due to the fact that no 1 can be forced to enter specified a case as a reason.
In the event of an unwillingness of specified a individual being notified, the civilian procedure shall not give any means of coercion to the court or the plaintiff already acting in the case. In addition, it is only possible to enter the trial within an objectively short period of 14 days after receiving a letter from the court in this matter. However, the full procedure active could in practice extend the case for at least a fewer months.
It is so not hard to imagine that, in many cases and for many different life reasons, it was not possible for all borrowers to formally join the proceedings against the bank.
What were the judgments of the courts then? The Court of First Instance observed in its judgement the grounds for the annulment of the contract and for the reimbursement of the instalments paid, but in the operative part itself ruled that the action for annulment was dismissed. Therefore, the interests of our plaintiff for the future were not adequately secured, and the bank, in order to act after anger, could proceed to collect instalments.
Furthermore, since our reason partially – and sometimes even half – (seeing the value of the claim for payment and claims for annulment) "lost" in the judgement of the court, the court charged him in the right part with the costs of the trial, frequently reaching the amounts of respective 1000 zlotys.
And what's next?
The origin of this jurisprudence is the question of the nature of the participation of all borrowers in the cancellation process. Is it truly either everybody or nobody? Why is the reason to be ‘punished’ by dismissing an action for annulment of the contract, just due to the fact that individual else, frequently a stranger, does not want to appear next to him on the same side of the courtroom? Both the legal literature and the case law of the average courts lacked more extended arguments in this respect specifically concerning the annulment of ‘franque’ contracts.
Already the first appeal attended by the Chancellery of Jachir Saturday, which she represented adw. Dominica Wilczyńska-Gay, from specified a judgement given by the territory Court in Warsaw in the celebrated XXVIII ‘Frank Division’ (file number: XXVIII C 2321/21) resulted in a complete success. By judgement of 21.10.2022 (Event No I ACa 93/22/), the Court of Appeal in Warsaw took full account of the appeal made on behalf of the client and amended the contested judgment. It clearly established the nullity of the contract in the wording of the judgement and the full costs of the proceedings before the court of First Instance were borne only by the bank. This allowed for a smooth settlement of the client with the bank both in terms of the reimbursement of all instalments so far and the liquidation of the debt balance for the future.
The Court of Appeal in Warsaw confirmed the arguments raised in the appeal raised by both Polish and EU government (in peculiar Directive 93/13/EEC) against the view that all borrowers should be gathered in a single process.
Interestingly, only almost precisely 1 year later, the ultimate Court confirmed the view presented by the Chancellery of Jachira Saturday that it was not essential for all borrowers to participate in the cancellation of the ‘franco loan’ agreement. What is even more interesting – only a fewer days apart, 2 resolutions were passed in the ultimate Court in various cases and in different judicial compositions of the same content (resolution of the ultimate Court of 19.10.2023, III CZP 12/23 and resolution of the ultimate Court of 26.10.2023, III CZP 156/22).
Does this mean a definitive solution to this issue in case law?
It has not been long since the ultimate Court's autumn resolutions. In the Polish legal strategy based on Civil law These resolutions have authoritative binding power only in the cases in which they were issued. However, they are in practice a very crucial interpretative clue for the general courts throughout Poland, and at the same time they can convince those who are not yet convinced that it is worth fighting for their rights in court.
Lawyers representing borrowers hope that courts across Poland will not spend more time and energy searching for the addresses of another borrowers and informing them about the case. They hope 1 individual in court is adequate to cancel the credit agreement, even if more people signed it.
The author of the text is the lawyer of Dominika Wilczyńska-Gaj, who has been representing borrowers before courts in frank cases for respective years.
Graduate of Adam Mickiewicz University in Poznań, Rector's scholarship for the best students. She obtained her professional title in the Bar Association in Wrocław, obtaining very good marks on the bar exam. She gained her professional experience working with renowned law firms in Poznań and Wrocław.
He specializes in civilian law, in peculiar in matters of loans valued at abroad currency, as well as in damages, inheritance, physical, family, medical and social security. It is characterised by an individual and insightful approach to each case, so that it achieves many successes in cases with an highly complicated factual and legal condition. He successfully represents clients before courts of all instances throughout Poland.
