Pursuant to Article 491(1) kc defining the statutory withdrawal from the contract, if 1 of the parties is allowed to hold in the performance of an work under the common agreement, the another organization may set an appropriate additional time limit for it to comply with the hazard that, in the event of an unsuccessful expiry of the prescribed time limit, it will be entitled to retreat from the contract. It may besides either without an additional deadline, or after it has been unsuccessfully terminated, request the performance of the undertaking and the compensation of the harm resulting from the delay.
Only the part of the benefit shall be subject to delay
As provided in Article 491(2) kc, where the benefits of both parties are divisible and 1 of the parties is allowed to hold only part of the benefit, the right to retreat from the contract of the another organization is limited, according to its choice, either to that part or to the remainder of the unfulfilled benefit. That organization may besides retreat from the contract in its entirety if the partial execution would not be applicable to it due to the characteristics of the undertaking or due to its intended intent of the contract, known to the organization in delay.
Difference between contractual and statutory withdrawal
Necessary premise contractual reservation of the right of withdrawal is the word to which the parties may exercise that right.
In turn for effective implementation statutory right of withdrawal Whereas, provided for in Article 491(1) and (2) k.c., it is essential to set an additional time limit for the another organization to comply with the common agreement obligation, with the hazard of withdrawal in the event of the unsuccessful expiry of the prescribed time limit;
Just as it is invalid (Article 58(1) and (3) of the Code) the reservation of a contractual right of withdrawal unlimited by any time limit (so: judgement of the ultimate Court of 8 December 2010, act No. V CSK 177/2010, non-publ.), so will it be ineffective to exercise a statutory right of withdrawal under Article 491 of the Law, which was not preceded by the appointment of an appropriate time limit for the performance of the work with a hazard of performance of the right of withdrawal.
Legal right of the creditor to retreat from the common agreement as a shaping power
The statutory right of the creditor to retreat from the common agreement as provided for in Article 491 k.c. if the debtor is allowed to hold the performance of the undertaking constitutes his or her decision to revoke the work by making a unilateral declaration of will (yes: judgement of the ultimate Court of 2 April 2008, Case III CSK 323/07, LEX No 453089).
The right of withdrawal established in that provision shall not be the kind of contractual right of withdrawal referred to in Article 395(1) k.c. The reservation of the contractual right of withdrawal shall not affect the right of counterparties to retreat from the contract conferred on them by law (e.g. Articles 491 and 493 k.c.), while those rules shall not apply to the contractual right of withdrawal (yes: judgement of the ultimate Court of 30 January 1998, III CKN 279/97, LEX No 315347 and order of the ultimate Court of 20 March 2014, Act No I CSK 404/13).
Implementation of the statutory right of withdrawal erstwhile the parties provided for the anticipation of a contractual right of withdrawal
The ultimate Court in its judgement of 6 July 2016, Act IV CSK 687/15 has concluded that Article 395 k.c. on the contractual right of withdrawal and implements Article 3531 k.c. the rule of freedom of contract – it provides for the parties to be able to reserve the right of withdrawal. This provision is mandatory in so far as it requires the parties to specify a period within which they may retreat from the contract. To the remainder, it is comparatively valid and so the parties can freely find the causes and effects of the withdrawal.
In case of a contractual right of withdrawal, as long as that right does not apply the statutory right of withdrawal, including the regulation contained in Article 491(2) of the Code concerning the statutory right of withdrawal (so: ultimate Court judgments of 23 January 2008 V CSK 379/07, OSNC-ZD 2008/4/108 and 9 September 2011 I CSK 696/10).
If, therefore, the parties within the scope of their contractual freedom have exercised the right of withdrawal and have reserved specified a right in the contract determining the period for which they may avail themselves of it shall be bound for that period by the contractual right of withdrawal. The contractual deadline for the exercise of the contractual right of withdrawal shall be the end date of the contract, after which the contractual right of withdrawal expires.
After the expiry of the contractual right of withdrawal from the contract, the parties may retreat from the contract under the conditions laid down in the Act, i.e. under the conditions governing the statutory right of withdrawal, provided for in general provisions specifying the consequences of the debtor's hold in the performance of the work (Articles 491- 493 k.c.) or in circumstantial provisions, inter alia, in Article 635 kc (yes: judgement of the ultimate Court of 6 July 2016, Act IV CSK 687/15).
The anticipation to measure in the appeal the correctness of the application of the applicable withdrawal provision
The ultimate Court noted in the above context that the legal basis for the judgement of the second instance was Article 492 k.c., the infringement of which the applicant had not alleged, and so the ultimate Court, bound by cassation grounds (Article 39813 § 1 k.p.c.), could not be subject to a legal assessment whether the second instance was correctly applied by the Court of First Instance.
Similarly, in the absence of a plea in law in breach of Article 491(1) of the Code laying down general grounds for withdrawal from the common agreement in the event of a hold of 1 of the parties in the performance of the undertaking, there was no basis for the ultimate Court to measure the applicability of that provision to the facts of the case, as alternative basis (yes: ultimate Court in judgement of 6 July 2016, Act IV CSK 687/15).
Designation of an additional deadline for the performance of the work to the another organization as a condition for effective withdrawal
The effective withdrawal from the common agreement provided for in Article 491 k.c. requires the creditor to execute 2 separate operations. The first is to set an appropriate deadline for the performance of the commitment with a hazard of withdrawal. The second step is to make a self-declaration of the will to retreat from the contract (yes: judgments of the ultimate Court of 15 June 2000, act No II CKN 287/00, non-publ; of 29 June 2004, act No II CK 398/03, non-publ, of 5 April 2013, Act No III CSK 62/13).
Withdrawal from the Agreement under Article 491 kc a lex committee clause (Article 492 kc)
Article 492 kc, in case of hold to 1 party, reserves the right to retreat from the contract without delay, without setting an additional time limit for the performance of the work where the right of withdrawal is reserved in the default agreement to the another organization within a strict time limit (the alleged lex committee clause). This provision is besides applicable where the execution of an work by 1 of the parties after the deadline is not applicable for the another due to the nature of the work or due to the fact that it is impossible for that organization to accomplish the intended intent of the contract (yes: judgments of the ultimate Court of 5 June 2002, act No. II CKN 701/00, TSO 2003, No. 10, item 124; of 6 May 2004, act No. II CK 261/03, non-publ.; of 5 October 2006, act No. IV CSK 157/06, OSNC 2007, No. 7-8, item 114).
Therefore, both the withdrawal under Article 491 kc and the withdrawal under Article 492 kc are subject to the hold of the another organization in the performance of an work under the common agreement, and this is so the case where non-execution is due to circumstances, for which the organization is responsible.
The ultimate Court in its decision of 20 March 2014, Act No I CSK 404/13 stated that the right to retreat from the contract was based on a provision of the Act (Article 491 k.c.). The agreement of the parties in this case refers only to 1 of the conditions for the exercise of that right (allocation of an additional deadline for the execution of the work to the debtor) and exempts the creditor from that activity if the parties have, by virtue of their decision, given a timely nature to the debtor.
The word ‘closely defined time limit’ in Article 492 k.c. is not defined, but the lex committee clause contained in that provision is 1 of the rules already known in Roman law. The ultimate Court has explained that this word means a clearly defined minute of performance, for example, or a certain period measured by the unit of time, e.g. a certain number of days of weeks, etc.). The meaning of the word does not end with abstract timing, as it is intended to indicate the minute of the formation or cessation of legal effects (yes: ultimate Court judgement of 24 June 2010, IV CSK 67/10, LEX No 621351).
Similarly, the ultimate Court stated in its judgement of 12 October 2017, Act IV CSK 708/16 indicating that the provision of Article 492 kc is immanently linked to Article 491 kc which, by virtue of the law, grants the creditor the right to retreat from the common agreement if the debtor has been delayed. However, before exercising that right, the debtor should be given an appropriate additional time limit for the performance of the obligation, together with the hazard that, in the event of the unsuccessful expiry of that period, he will be entitled to retreat from the contract. However, pursuant to Article 492 k.c., the creditor may, without that additional period being fixed, retreat from the contract ‘If the right to retreat from the common agreement has been reserved in the event of default within a strictly specified period’. This is so not the case – as in cases of contractual right of withdrawal (Article 395 §1 k.c.) – to set a time limit adquem (a minute envisaged or determined as final, closing something) to make a declaration of will to retreat from the contract, but to set a precise deadline for the performance of the benefit (a quo the minute taken as the beginning of something), which gives emergence to the right of the creditor to retreat from the contract.
However, the contractual reservation provided for in Article 492 k.c. modifies the laws alternatively than the contractual right of withdrawal. This amendment is based on the fact that, while it is possible to exercise the right of withdrawal, as in Article 491 k.c., only in the event of a hold in the execution of the undertaking, otherwise than in Article 491 k.c. withdrawal shall take place without an additional deadline. That right cannot so be qualified as a contractual kind since it constitutes a case of statutory right of withdrawal.
In the case cited, Case No. IV CSK 708/16, the ultimate Court stressed that the clause provided for in the agreement of the parties had just legal features legis commisoriae in the above sense. The parties undoubtedly had a common agreement (for specified a legal nature is the work contract – Article 627 of the Code), which the parties have concluded. The contract clause of the parties reserved the right of withdrawal in the event that the contractor exceeded the deadline laid down in the contract by 30 calendar days for each element. That is the word a quo until withdrawal from the contract has been closely marked. With not restricted ‘automatic’ withdrawal from the contract by expiry of that periodin accordance with Article 492 k.c., there was a request to make an appropriate declaration of will by the contracting authority.
The right to retreat from the common agreement without an additional deadline for the performance of the benefit, and so without a circumstantial ‘warning’ of the debtor, shall be allowed only in the strictly defined cases in Article 492. Therefore, it constitutes an exception to the general regulation set out in Article 491 k.c. and should be interpreted narrowly, in accordance with the rule exceptiones non sunt extendae. Therefore, this right is only granted in the case of the debtor’s hold alternatively than in the case of any another hold in the performance of the obligation, and only if the right to retreat from the common agreement has been reserved in the event of default within a strictly specified period (yes: the ultimate Court order of 20 March 2014), Act No I CSK 404/13).
Non-determination by the creditor of an additional period pursuant to Article 491(1) kc alex committee (Article 492 kc)
The Court of Appeal in Warsaw in its judgement of 23 February 2017, Act No VI ACa 1936/16, on the basis of a case where the claimant has not shown that he has set an appropriate additional time limit (under Article 491(1) kc) for the performance of the contract with a hazard that, in the event of an unsuccessful expiry of the prescribed time limit, he will be entitled to retreat from the contract and any call for the performance of the contract shall be addressed to the suspect under the rigor of calculating the contractual penalties (and thereforethe conditions of Article 491 kc are not fulfilled) considered that the claimant’s withdrawal Whereas Articles 492 and 635 can be assessed under Articles 492 and 635., applicable to a works contract pursuant to Article 656 k.c.
Pursuant to Article 635 k.c., where the receiving contract is delayed with the commencement or completion of the work so far as it is improbable that it will be able to complete it within the time prescribed, the contracting authority may, without setting an additional time limit from the contract, retreat before the expiry of the time limit for the performance of the work. Pursuant to Article 635 k.c., the contracting authority may retreat from the contract for a work (or works) even after the deadline for the performance of the work has expired.
Where the contracting authority withdraws from the contract where the hold is the consequence of the circumstances for which it is responsible, the withdrawal pursuant to Article 635 k.c. shall be ineffective and shall be treated as a withdrawal pursuant to Article 644 k.c. The consequence of specified withdrawal is that the contractor retains the right to pay (reduced as appropriate).
In the case of a works contract, the hold in the execution of the works, and thus the failure to meet the deadline for the execution of the works even for reasons not caused by the contractor, entitles the contractor to retreat from the contract, without the request for an additional deadline. The effectiveness of withdrawal is conditional on the absence of the right to abstain from the performance of the contractor. In the case at issue, the Court of Appeal noted that the suspect indicated the reasons why he abstained from the performance of the contract, and the plaintiff did not prove that these reasons did not actually be and that there were no grounds for stopping the works. The suspect has, until the claimant has made a declaration of withdrawal from the contract, taken action to remove the obstacles and to proceed with the work. The Court so considered that there were no grounds for withdrawal from the contract due to the defendant’s fault.
Effects of withdrawal from the common agreement
A organization whose withdrawal from the common agreement shall be obliged to repay to the another organization all that it has received under the agreement, may request not only the reimbursement of what it has demonstrated, but besides the compensation of the harm resulting from the default (Article 494 k.c.). Article 471 k.c. shall apply to that responsibility. The debtor shall be obliged to make good the harm resulting from the default or breach of the obligation, unless the failure or improper execution is simply a consequence of circumstances for which the debtor is not liable.
The contractual liability is based on the debtor's responsibility and is the alleged responsibility (yes: ultimate Court judgement of 12 May 2005, No. III CSK 586/04, non-publ.). The scope of the compensation work shall be determined by Article 361(2) k.c. and shall cover the losses suffered by the injured individual and the benefits which he could have achieved if the harm had not been caused. Although the contractor is exempted from further works as a consequence of withdrawal from the contract, this does not mean that the failure of benefits is not compensated, which this contractor would have achieved if the contract had been full implemented (so: ultimate Court judgement of 15 November 1990, act No II CR 184/90. Pr. Gosp. 1993, z. 3, p. 20).
Therefore, in principle, in accordance with the conditions laid down in Article 471 of the Code, the action cannot be ruled out as a consequence of the contractor’s withdrawal from the works contract for reasons attributable to the investor (yes: ultimate Court judgement of 5 April 2013), Act No III CSK 62/13).
Withdrawal from the contract and compensation transferring the amount of the reserved contractual punishment
In the absence of different contractual provisions (a deficiency of an appropriate reservation authorising the contractor to search supplementary compensation) it is not acceptable to search compensation for the amount of the reserved contractual punishment (yes: judgement of the ultimate Court of 5 April 2013, Act No III CSK 62/13).
Payment of only part of the agreed price and withdrawal from the contract under Article 491 kc
On the legal question set out in the words ‘Is it permissible for the seller to exercise the statutory right of withdrawal from the contract for the sale of immovable property referred to in Article 491(1) kc where the buyer has paid only part of the agreed price and with the payment of the remaining part of the price remains in hold alternatively than the circumstances provided for in Article 493(2) kc’ of the ultimate Court in its decision of 25 June 2015, Act III CZP 83/15 said it is permissible to retreat from the common agreement on grounds of hold with respect to the part of the distributive benefit besides where the benefit of 1 of the parties is indivisible (Article 491(1) kc).
In its message of reasons, the ultimate Court indicated that, according to the established position of the ultimate Court, a organization may retreat from the contract of compulsory regulation on the basis of which the property was transferred within the statutory power. specified a contract can be terminated by the parties if it has not been full implemented (so: the resolution of the composition of the 7 ultimate Court judges of 30 November 1994, act No. III CZP 130/94, OSNC 1995, No. 3, item 42).
In Article 491 § 1 kc, the legislator has designated the scope of application of the regulation laid down therein by mention to the concept ‘commitment from the common agreement’, without indicating any characteristics characterising the benefits of the parties to the legal relation arising from its conclusion.
Article 491 § 2 k.c. explicitly applies only to cases where the benefits of both parties to the common agreement are divisible. In that provision, the legislator sets out the conditions for withdrawal erstwhile 1 of its parties is allowed to hold only part of its benefit. The right to retreat from the contract to the another organization shall be limited, at its choice, either to that part or to the remainder of the unfulfilled benefit. That organization may besides retreat from the contract in its entirety if the partial execution would not be applicable to it due to the characteristics of the undertaking or due to its intended intent of the contract, known to the organization in delay. It may besides either without an additional deadline or after it has been unsuccessfully terminated, request the performance of the undertaking and compensation for the harm resulting from the delay.
Since in Article 491 § 2 kc the legislator refers to the characteristics of the divisibility of the provision of 1 of the parties to the common agreement, as deciding to usage it as a basis for the declaration of withdrawal, the comparison of that provision with Article 491 § 1 kc justifies the conclusion that Article 491 § 1 kc – in the absence of any regulation on its usage relating to the characteristics of the party’s performance in hold with the performance of its own obligation – specify the conditions for withdrawal from the contract erstwhile the benefits of both parties are indivisible, But besides erstwhile 1 is divisible and the another is indivisible.
Such characteristics are those of the parties in the contract for the sale of goods in which the seller's transfer of ownership is indivisible and the buyer's payment of the price is divisible within the meaning of Article 379(2) k.c.
If, therefore, in the circumstances referred to in Article 491(2) of the Act, 2 k.c. can be waived from the full contract, although the common benefits are divisible, this can besides be done erstwhile 1 is divisible and the another is indivisible.
Different view of the statutory right of withdrawal from the common agreement in case of hold in the performance of part of the benefit
A different view in relation to the assessment of the effectiveness of the declaration of withdrawal from the construction contract was expressed by the ultimate Court in its judgement of 16 May 2013, Case No V CSK 260/12 (OSNC-ZD 2014, No 3, item 49), in which it accepted that the provisions of the civilian Code do not supply for a statutory right of withdrawal from the common agreement in the event of hold in the fulfilment of part of the benefit if the benefit of the another organization is indivisible. It may then be considered to apply the analogy to the arrangements provided for in Article 493(2) k.c. allowing withdrawal from the contract in the event of partial inability to supply 1 of the parties.
Should the application of Article 493 §2 k.c. be excluded by analogy, it should be considered that, in the event of a hold of 1 of the parties to the common agreement in the performance of part of the benefit, withdrawal from the contract under the statutory right of withdrawal, if the benefit of the another organization is indivisible, is inadmissible. A organization who has accepted a partial benefit may then only execute the remainder of the benefit and make good the harm resulting from the delay.
This view in the provision cited above of 25 June 2015, Act III CZP 83/15 However, the ultimate Court has stated that the wording of Article 491(1) of that provision does not let it to be considered to apply only to situations where the benefits of both parties to the contract are indivisible. If the legislator wishes to restrict the scope of Article 491 §1 k.c., its manifestation should be to mention to the concept of indivisibility of the benefits of the parties, as a characteristic of their benefits, which determines the application of the conditions of withdrawal provided for in Article 491 §1 k.c.
In the absence of a reservation another than those resulting from the application of Article 491(2) k.c. which restricts the application of Article 491(1) k.c., it should be assumed that that provision lays down the conditions for withdrawal from the common agreement, in which the benefits of both parties are indivisible, but besides 1 indivisible only to 1 party.
Withdrawal from the works contract due to hold in giving the contracting authority adequate warrant of payment
The hold in implementation of the common agreement work referred to in Article 491(1) and (2) shall mention to both the obligations laid down in the agreement of the parties and the obligations laid down in the provisions applicable to the agreement connecting the parties. This means that, in the legal state in which the contract was concluded and in which it was carried out, it was necessary, in order to effectively retreat from the contract due to the hold in granting a adequate warrant of payment by the contracting authority (requirement under Article 649 4 § 1 kc) to set an appropriate additional deadline for the performance of that work with the hazard that, in the event of the unsuccessful expiry of the prescribed period, the contractor would be entitled to retreat from the contract.
In order to effectively apply Article 491 k.c., before submitting a declaration of will to retreat from the contract, it is so essential to supply the investor with a prior deadline to present a warrant of payment with a hazard of withdrawal in the event of an unsuccessful expiry of that period (yes: ultimate Court judgement of 5 April 2013, Act No III CSK 62/13).
Derogation from the contract for works – read here
