Poland: Litigation Dispute Resolution Comparative Guide

1 Legal framework

1.1 What system of jurisprudence applies in your jurisdiction? What implications does this have for litigation?

The Polish legal system is based on statutory law, as opposed to common law. Contentious issues are resolved through a contradictory system by common courts, although an increasing number of cases are settled through arbitration or mediation. Given the complexity of the procedures applicable to court disputes, most cases require the parties to cooperate with a professional attorney.

1.2 What rules govern litigation in your jurisdiction?

The procedural provisions governing litigation in Poland are contained in one legal act – the Code of Civil Procedure. On the other hand, their application in practice is affected by prior court decisions – in particular, those of the Supreme Court. Therefore, even though Poland does not follow the rules of common law, the opinions expressed in the jurisprudence and justifications of Supreme Court judgments are of material importance when implementing the provisions of law.

1.3 Do any special regimes apply to specific claims?

Yes. A number of cases are considered according to specific rules. These include:

• commercial activities;
• market competition issues;
• employment and family issues;
• simple procedures concerning minor claims; and
• procedures based on specific documents (eg, bills of exchange).

1.4 Which bilateral and multilateral instruments have relevance to litigation in your jurisdiction?

Generally, there are few elements of contentious issues that can be governed by a court settlement. On the other hand, contracts between parties may include arbitration clauses that must be observed, as well as clauses determining the local jurisdiction of the common courts of law or specifying the substantive law of the state to be relied on when resolving the case.

2 Judicial structure

2.1 What courts exist in your jurisdiction and how are they structured?

Disputes are considered by three types of common courts:

• district courts;
• regional courts; and
• appellate courts.

Poland has a two-instance procedure, with the district or regional courts (depending on the gravity of the case) acting as the first-instance courts and then the regional or appellate courts acting as the second-instance courts.

2.2 What specialist courts or tribunals exist in your jurisdiction?

The Supreme Court enjoys special importance in Poland. It considers extraordinary means of appeal (in the most serious cases) filed against judgments of the common courts of law.

Outside the structure of the common courts, there are also administrative courts. These do not settle disputes, but review decisions of the public administrative bodies, such as those relating to building permits

3 Pre-litigation

3.1 What formalities apply before litigation can be commenced in your jurisdiction?

Prior to commencing litigation, there should be at least an attempt to settle the dispute amicably. In practice, this usually involves nothing more than sending a writ of payment or a call to hold settlement negotiations before a court, or proposing mediation.

3.2 Do any pre-action protocols or similar rules apply prior to the commencement of litigation? What are the consequences of non-compliance?

No. However, the statement of claim should refer to the fact that an attempt to settle the case amicably has been undertaken or explain why no such attempt was made.

3.3 What other factors should a party consider before commencing litigation in your jurisdiction?

Prior to commencing litigation, each party should estimate the costs potentially associated with the proceedings. For instance, if an expert opinion proves necessary, the party requesting it will usually be obliged to make an advance payment towards covering the drafting costs.

4 Commencing litigation

4.1 What rules on limitations periods apply in your jurisdiction?

The statutory limitation periods are specified in various provisions of law. Generally, the statutory limitation period amounts to six years, or three years for claims connected to the conduct of business activities and those concerning periodical benefits (interest).

Claims arising from certain agreements, such as mandate contracts, become time barred after two years. Claims of employees are usually subject to a three-year statute of limitations. Claims arising from prohibited acts usually become time barred three years after the afflicted party learned of both the damage and the identity of the entity obliged to redress the same, though no later than 10 years after the damage was inflicted. However, there are exceptions to this rule; for example, claims for compensation in relation to a crime become time barred after 20 years. Upon the commencement of court proceedings, the running of the statutory limitation period is discontinued.

The court will generally take into consideration the defence that a claim is time barred if the defendant makes the relevant motion. However, in cases against consumers, the court takes the statutory limitation period into consideration ex officio.

4.2 What rules on jurisdiction and how this is determined apply in your jurisdiction?

The jurisdiction of the court is specified in procedural provisions. The pertinent court is generally the court at the place where the registered office or place of domicile of the defendant is located, though there are various exceptions to this rule. In addition, the parties may agree on the court jurisdiction.

4.3 Are class actions permitted in your jurisdiction?

Yes. However, a class action is a special procedure in which specific individuals act as plaintiffs. It is not possible for a class action to be filed by anonymous individuals or entities.

4.4 What are the formal requirements for commencing litigation?

A writ initiating the proceedings must satisfy a number of conditions specified in the procedural provisions. These include:

• specifying an exact demand;
• making duly structured motions to take evidence; and
• determining the value of the litigated claim.

In addition, a court fee is usually required in order to commence proceedings.

4.5 What are the procedural and substantive requirements for commencing litigation?

Proceedings are initiated by the court, which examines whether the formal conditions are satisfied and then serves the writ on the other party, which results in the lis pendens.

4.6 Are interim remedies available in your jurisdiction? If so, how are they obtained?

Yes, Poland has an injunction procedure through which claims can be secured. The court considering a given case, during or even before the proceedings commence, may apply certain measures to guarantee the possibility of performing the future decision. These may include:

• the temporary seizure of one party's assets up to the value of the claim; or
• a prohibition on undertaking specific actions or the discontinuation of the effects of any actions that have already been undertaken.

4.7 Under what circumstances must security for costs be provided?

The costs of the proceedings are secured in injunction proceedings only if the court may decide to do and if a party does not have assets in Poland.

5 Disclosure

5.1 What rules apply to disclosure in your jurisdiction? Do any exceptions apply to certain types of documents?

Generally, there is no obligation to disclose all information. However, certain documents of importance for the case must be filed if the court so demands, usually at the motion of the other party. If the party refuses to do so, it risks losing the case. However, no other burdensome consequences are provided. Documents and information subject to secrecy rules specified in the provisions of law may be filed if the court waives the privilege.

5.2 What rules on third-party disclosure apply in your jurisdiction?

A third party must provide a document at the court's request.

5.3 What rules on privilege apply in your jurisdiction? Does attorney-client privilege extend to in-house counsel?

Professional attorneys are bound by professional secrecy rules, which also protect such things as settlement talks. Privileged information must not be disclosed to third parties. This privilege extends to in-house lawyers, as long as they are professional attorneys – that is, advocates or legal advisers (there are two professional groups in Poland, though in practice they do not vary significantly). Attorneys with no professional qualifications are not bound by the privilege rules.

5.4 How have technological advances affected the disclosure process in your jurisdiction?

They have not, due to the absence of disclosure procedures.

5.5 What specific considerations should be borne in mind during the disclosure process, for both plaintiff and defendant?

N/A.

6 Evidence

6.1 What types of evidence are permissible in your jurisdiction?

A piece of evidence can be anything that concerns facts that are material for the settlement of the case. What is formalised is evidence in the form of:

• documents;
• witness testimonies;
• expert opinions;
• inspection of assets; and
• hearing of the parties.

6.2 What rules apply to expert evidence in your jurisdiction? What specific considerations should be borne in mind when preparing and presenting expert evidence?

Expert witnesses are appointed by a court, rather than by a party. Expert witnesses issue their opinions in compliance with the procedural rules. Private opinions (ordered by the parties) are not binding on the court, though they can be useful to support a party's position or to indicate mistakes made in the opinion submitted by the expert witness.

6.3 What other factors should be borne in mind when preparing and presenting evidence in your jurisdiction?

The general rule is that the evidence should be presented at the beginning of the proceedings. Thereafter – particularly in proceedings involving businesses – the opportunity to submit evidence is limited and requires additional justification and consent from the court.

7 Court proceedings

7.1 What case management powers do the courts have in your jurisdiction?

The course of the litigation is subject to procedural rules, while the court has extensive powers concerning issues such as the timeframe within which to submit evidence. In addition, hearings are scheduled at the discretion of the court, as often as is feasible for the court.

7.2 Are court proceedings in your jurisdiction public or private? If the former, are any options available to the parties to keep the proceedings or related information confidential?

Court proceedings are public, except for those concerning family or marital issues. Access to the case files, on the other hand, is granted only to the parties. For important reasons – for example, to protect business secrets – the court may decide to hold a hearing in chambers.

7.3 How is the applicable law determined? What happens in the event of a conflict of laws?

The provisions of law, including the provisions of EU law, specify which law is applicable to a dispute. It is also possible for the parties to specify in the contract the applicable law should any conflict arise between them. Conflicts of laws are resolved by provisions of law – in particular, the Act on Private International Law and Regulation (EC) No 593/2008 of the European Parliament and of the Council of 17 June 2008 on the law applicable to contractual obligations (Rome I).

7.4 What rules apply to the joinder of third parties?

Third parties may join the proceedings at any time until a court decision has been rendered. In general, a third party may join to support any party as long as it has a legal interest in having the case settled in a certain way.

7.5 How do the court proceedings unfold in your jurisdiction? What specific considerations should be borne in mind at each stage of the process, for both plaintiff and defendant?

Court proceedings involve the exchange of pleadings setting out the written positions of the parties. Evidence is taken through hearings, usually at the parties' request. Between the hearings, there is a limited opportunity to submit additional pleadings, although the parties may be obliged to do so by the court.

Both the plaintiff and the defendant should bear in mind that expert witness opinions are important; as is the submission of evidence at the initial stage of the proceedings, to avoid it being dismissed as submitted too late.

7.6 What is the typical timeframe for the court proceedings?

Depending on the gravity of the case and the amount of evidence, litigation in Poland takes, on average, between two and four years at first instance. Appellate proceedings take at least another year or even longer if the case is particularly complicated.

8 Judgment and remedies

8.1 What types of judgments, orders and other remedies are available in your jurisdiction?

The courts issue judgments settling cases on the merits as well as decisions concerning incidental issues. There are also special types of decisions, such as payment orders issued in cases involving a monetary claim. However, if a defendant objects to a payment order, the payment order will be quashed and the case will be considered in the ordinary way. The proceedings will then end with a judgment.

9 Appeals

9.1 On what grounds may a judgment be appealed in your jurisdiction?

Court settlements may be appealed based on a breach of substantive provisions and/or procedural provisions.

9.2 What is the appeals process? Is the judgment stayed while the appeal is pending?

In principle, if an appeal has been filed, the judgment that has been appealed is not enforceable. Only final and enforceable judgments can be enforced – that is, after an appeal has been considered. However, exceptions to this rule apply where a judgment has been performed even though it is not yet final and enforceable (eg, a judgment by default).

9.3 What specific considerations should be borne in mind during the appeals process, for both plaintiff and defendant?

An appeal requires the payment of a fee. Moreover, in most cases, the defences will need to be properly formulated by a professional attorney.

10 Enforcement

10.1 How are domestic judgments enforced in your jurisdiction?

Judgments are enforced exclusively by a court bailiff, treated as a public official.

10.2 How are foreign judgments enforced in your jurisdiction?

Foreign judgments are enforced once the court has appended an enforceability clause in simplified proceedings, during which the judgment is checked to confirm the satisfaction of formal requirements. Special procedures apply to EU court judgments based on Regulation (EU) No 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters.

10.3 What specific considerations should be borne in mind during the enforcement process, for both plaintiff and defendant?

The enforcement process is not overly complicated; it does not require a party to be very active, as most actions are left to the court bailiff. Enforcement against real estate, however, is significantly more complicated, as this is a multi-stage procedure that involves the valuation of the real estate followed by an auction, the adjudication of title to the real estate and finally the distribution of the amount received from the enforcement. At each stage of the process, specific actions can be appealed.

11 Costs, fees and funding

11.1 What costs and fees are incurred when litigating in your jurisdiction?

To initiate litigation, the plaintiff must pay a fee of up to 5% of the value of the litigated claim, capped at PLN 200,000. The losing party must cover the costs of the proceedings. Other fees may also be required – for instance, those relating to expert opinions. However, these are limited in the provisions of law and will depend on the value of the litigated claim.

11.2 Are contingency fees and similar arrangements permitted in your jurisdiction?

Yes. Provisions on contingency fees depending on the outcome of the proceedings can be included in agreements between attorneys and clients, but only on top of a regular fee. A success fee alone is not permitted by the ethical codes of professional attorneys,

11.3 Is third-party funding permitted in your jurisdiction?

Third-party funding is allowed, although this issue is outside of the court's interest. It is left exclusively up to the party and the financing entity.

11.4 What other strategies should parties consider to mitigate the costs of litigation?

Theoretically, the costs of litigation may be limited by resorting to mediation or arbitration. However, these methods can sometimes end up being more time consuming, since arbitration awards can be appealed in court; which means that in certain cases litigation may turn out to be the least expensive option.

12 Trends and predictions

12.1 How would you describe the current litigation landscape and prevailing trends in your jurisdiction? Are any new developments anticipated in the next 12 months, including any proposed legislative reforms?

Emphasis is currently being placed on concentrating proceedings by increasing the obligations of the parties – particularly in relation to the submission of evidence. Court fees have also increased. Material changes have further been introduced over the past two years – for example, a specific procedure was restored in inter-company litigation. We do not expect any material changes that would affect the course of proceedings to be introduced in the near future.

13 Tips and traps

13.1 What would be your recommendations to parties facing litigation in your jurisdiction and what potential pitfalls would you highlight?

Diligent drafting of the pleading initiating the proceedings is essential, as any mistakes will be difficult to remedy in the subsequent stages of the proceedings. Professional knowledge is also essential when formulating the grounds for appeal.

The costs of the proceedings may turn out to be a potential pitfall, particularly if the case concerns complicated technical issues. In such cases, the costs of expert witness opinions may even exceed the value of the initial court fee paid on the value of the litigated claim.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.