arbitration-poland.com - Key issues - arbitration court procedure

id: 20362

Polish Supreme Court judgment dated 28 January 2011 (Case No. I CSK 231/10) »

1. An arbitration court may rule on its own jurisdiction in a proceeding in which a claim has been filed (Civil Procedure Code Art. 1180 §1), including also in a separate order. In the regulations concerning procedure before the arbitration court, the Parliament did not provide a basis for issuance of an award dismissing a statement of claim commencing a proceeding before the arbitration court, including in a situation where the arbitration court finds that it has no jurisdiction to decide the dispute. It follows from these provisions that in instances indicated in Civil Procedure Code Art. 1190 §1, 1196 §1 and 1198, the arbitration court shall issue an order discontinuing the proceeding. It should thus be accepted that the arbitration court shall issue such an order also when, after beginning to receive evidence in the matter, it finds that the proceeding cannot continue because of the lack of an arbitration clause or the invalidity of such agreement. Conducting the proceeding and issuing an award then becomes impossible for a reason other than that stated in Civil Procedure Code Art. 1198 (1) and the beginning of (2).

2. The nature of a ruling issued by a court, including by an arbitration court, is decided by the substance of the ruling, and not the name or external form which the court gave to the ruling .... The ruling challenged by the claimant in the petition to set aside the arbitration award ... was not—contrary to the name used—an arbitration award, but in light of the nature of the determination made therein, an order.

3. An order discontinuing the proceedings before the arbitration court because of the lack of a valid arbitration clause, or an order dismissing the statement of claim for this reason, is a ruling ending the proceeding before the arbitration court, in which the court rules on its own lack of jurisdiction in the matter. While an order by the arbitration court in which the arbitration court denies a defence of the lack of the arbitration court’s jurisdiction may be challenged before the common court by either of the parties within two weeks (Civil Procedure Code Art. 1180 §3), the Parliament did not provide for the opportunity to challenge before the common court an order by the arbitration court in which the arbitration court rules that it lacks jurisdiction in the matter. Upon issuance of such ruling, a proceeding before the common courts is open to the parties interested in resolution of the dispute, and they may exercise their right of access to the courts in such proceeding.

4. A negative determination by the arbitration court as to its own jurisdiction in a matter is a final ruling and is not subject to review by the common court. A ruling by the arbitration court finding that it lacks jurisdiction in the matter may thus not be challenged by a petition to set aside an arbitration award as provided by Civil Procedure Code Art. 1205 ff.

Case no.: I CSK 231/10

Key issues: arbitration clause, arbitration court procedure, jurisdiction of arbitration court, petition to set aside arbitration award

id: 20361

Polish Supreme Court judgment dated 16 December 2010 (Case No. I CSK 112/10) »

1. It is clear that an arbitration clause may be binding also on legal successors with respect to the relationship under which disputes were submitted to the arbitration court for resolution, ... but an endorsee is generally protected by Art. 17 of the Promissory Note Law against defences by the promissory note debtors based on their personal relations with the prior holders of the note. This also includes protection against the defence that the promissory note dispute is subject to an arbitration clause. ... The promissory note debtor could assert against the endorsee the defence that the promissory note dispute is subject to an arbitration clause agreed with the prior holder of the promissory note only if the endorsee, in acquiring the promissory note, consciously acted to the injury of the debtor, i.e. knew of the existence of grounds for the debtor to assert the arbitration clause against the prior holder and also sought, to the injury of the debtor, to deprive the debtor of such defence. ... The promissory note debtor’s assertion against the acquirer of the promissory note, without any limitations, of the defence that the promissory note dispute is subject to an arbitration clause, could come into play only in instances where the promissory note was acquired by way of an assignment agreement or endorsement after protest for non-payment or after the deadline for protest, having the effect of an assignment (Promissory Note Law Art. 20(1), first sentence).

2. Although a clause submitting a promissory note dispute to an arbitration court is theoretically permissible under Civil Procedure Code Art. 1157, to do so must be regarded from the perspective of the promissory note creditor as highly irrational, as it deprives the promissory note creditor of the benefits afforded it by seeking payment of the promissory note in a proceeding for an order of payment before the common court. ... The position cannot be accepted ... that benefits comparable to those afforded to the party enforcing payment of a promissory note by a proceeding for order of payment may be assured in an arbitration proceeding by reference to the regulations concerning proceedings for order of payment within the parties’ agreement concerning “the rules and manner of proceeding before the arbitration court” (Civil Procedure Code Art. 1184 §1).

3. In light of the irrationality of submission of a promissory note dispute to an arbitration clause, it should be accepted that the effectiveness of such a clause requires an express reservation with respect to the given promissory note claim which in each instance does not raise any doubts. ... This rules out extending an arbitration clause included in the agreement underlying the issuance of the promissory note, with respect to disputes connected with such agreement, to a promissory note claim against the issuer.

Case no.: I CSK 112/10

Key issues: arbitration court procedure, arbitration clause

id: 20331

Polish Supreme Court judgment dated 9 September 2010 Case No. I CSK 535/09 »

1. A petition to set aside an arbitration award is an extraordinary means of review intended to set aside the award if at least one of the grounds exhaustively set forth in Civil Procedure Code Art. 1206 is justified.

2. When considering a petition [to set aside an arbitration award], the state court is bound by the grounds alleged by the petitioner. Only two of the grounds set forth in Civil Procedure Code Art. 1206 §2 are considered on the court’s motion: the non-arbitrability if the dispute and inconsistency of the arbitration award with the fundamental principles of the legal order of the Republic of Poland.

3. The assessment of whether an arbitration award is contrary to fundamental principles of the legal order is addressed to the content of the award, and not the correctness of the procedure before the arbitration court or the composition of the panel. … An arbitration award may be set aside under the public policy clause if it is found that the results included in the content of the award are not consistent with a specific norm which is regarded as one of the fundamental principles of the legal order in force in Poland. ... These principles include not only constitutional norms, but also the overriding norms in specific fields of law.

4. The requirements made of persons serving as arbitrators should be combined with a party’s right to learn about any ties the arbitrator may have to entities appearing in the proceeding. It is up to the party to evaluate such circumstances as grounds for a decision to select an arbitrator or to seek removal of an arbitrator. The arbitrator’s self-assessment is irrelevant, because the essence of a fair procedure is tied to objective judgment by others. ... The fundamental principles of the legal order include the right to a court as provided in Art. 45(1) of the Polish Constitution, an element of which is a party’s right to have its case heard by an independent court, in a fairly conducted procedure.

Case no.: I CSK 535/09

Key issues: arbitrator, arbitration award, arbitration court procedure, petition to set aside arbitration award

id: 20342

Szczecin Appellate Court judgment dated 27 May 2009 (Case No. I ACa 177/09) »

1. By adopting an arbitration clause, the parties voluntarily restrict their own constitutional ... right to resort to the courts.... Matters are most often entrusted to arbitrators for resolution because of their specialized knowledge, e.g. in the field of construction (in construction cases) or concerning commercial practices (in matters related to international transactions), where specialized knowledge is more important than knowledge of the substantive legal norms of a given legal system. In cases of this type, the arbitrators’ legal intuition may be sufficient. In such instances, it should be accepted that the arbitration court is not bound by regulations of substantive law, given the nature of the matters submitted to the jurisdiction of the arbitration court.

2. Pursuant to Civil Procedure Code Art. 714, the court is bound by the grounds for the petition to set aside the arbitration award, and additionally will consider on its own motion whether the award violates the rule of law or good practice. The allegation that the arbitration award violates the rule of law essentially concerns the issue of the permissible scope of review of the determination by the arbitration court by the common courts. ... Such review authority does not concern the issue of the correctness of the determination in terms of compliance with substantive law, or compliance with procedural regulations. The only basis for such review may be aggravated violations, of particular seriousness and weight, such that they also constitute a violation of the rule of law. The grounds for setting aside an arbitration award are formal in nature, as it is impermissible to examine whether the arbitration court resolved the dispute correctly in factual and legal terms, but only whether there was a violation of the public policy clause.

3. Violation of the rule of law should be understood to mean an offence against fundamental legal institutions. A determination violating the rule of law would include one that offends overriding legal principles and is contrary to the commonly accepted legal order in force in the Republic of Poland. An arbitration award may violate the rule of law if it results in a determination violating the applicable principles of a state governed by the rule of law. It is essential in this respect that when considering the case and ruling, the arbitration court is not bound by provisions of substantive law, but only may not violate the applicable principles of a state governed by the rule of law.

4. There is no catalogue of fundamental principles of the legal order, but they must be inferred from the entirety of legal norms in force.

5. It is a general principle of civil law that damages are due only when the injured party has suffered a loss, the function of damages is to compensate for loss, and damages may not exceed the amount of the loss. It should thus be recognized that an arbitration award violates the public policy clause if the damages awarded do not correspond to the loss suffered.

6. In a situation where the parties failed to specify the rules of procedure, under Civil Procedure Code Art. 705 §2 the arbitration court will apply the rules of procedure it deems appropriate. It is generally not bound by the provisions of the Civil Procedure Code in this respect. For this reason as well, the arbitration court need not lay down a procedure in advance, i.e. at the outset of the proceeding. It may thus do so during the course of the proceeding, including by issuance of separate orders with respect to successive activities. This extensive discretion of the arbitration court is limited, however, by Civil Procedure Code Art. 705 §2, third sentence, by the requirement to thoroughly explore the circumstances necessary to resolve the case. It is clear in this respect that the arbitration court may not violate the principles of the rule of law or social coexistence.

7. The adversary principle, and the principle of the parties’ availability, also apply in a proceeding before an arbitration court, and such court may not omit a thorough exploration of the circumstances necessary to resolve the case. … The “inability to omit a thorough exploration of the circumstances of the case,” as referred to in Civil Procedure Code Art. 705 §2, third sentence, should be understood primarily as a duty to conduct the proceeding before the arbitration court in a manner that assures the parties themselves of the ability to present any allegations and evidence, and, as an aspect of the equal treatment of the parties, to address the allegations and evidence presented by the opposing side.

8. The fundamental principles in force under Polish law with respect to liability for loss caused by non-performance or improper performance of an obligation, as expressed by the Civil Code provisions concerning the effects of non-performance of obligations, are a duty to redress loss by the party to a contract that failed to perform or improperly performed its obligation, and, significantly, an ordinary causal relationship between the party’s action and the loss. The duty to redress loss in this respect may not be determined randomly or arbitrarily, but must correspond to the extent of the loss suffered (even if based on a consideration of all of the circumstances of the case), and default interest is due from the day following the date on which the debtor fell into delay. An arbitration award that was issued in violation of these principles is an award that violates the rule of law.

Case no.: I ACa 177/09

Key issues: arbitration clause, arbitration court procedure, petition to set aside arbitration award

id: 20257

Polish Supreme Court judgment dated 27 November 2008 Case No. IV CSK 292/08 »

1. A judicial proceeding to set aside an arbitration award should be conducted through to the end in accordance with the provisions in force upon commencement of the proceeding, that is, applying Civil Procedure Code Art. 165 §1, at the time of filing of the petition to set aside the award with the proper court. Thus if the petition was filed prior to 17 October 2005 [when the law was amended], the proceeding thereby initiated should be conducted thereafter in accordance with Civil Procedure Code Art. 712–715, but a proceeding commenced by a petition filed on that date or later, in accordance with Civil Procedure Code Art. 1205–1211. Similarly, a proceeding before an arbitration court should be conducted through to the end in accordance with provisions in force upon commencement of the proceeding. However, in light of the rule set forth in Civil Procedure Code Art. 1186, the date of commencement of a proceeding before an arbitration court will generally be the date of service on the respondent of the document containing the demand for arbitration.

2. In instances in which arbitrators are appointed by each party independently, a new arbitrator appointed by one of the parties has the same status as the former arbitrator. Since the former arbitrator was unable to reach agreement on selection of a super-arbitrator and it was necessary for the super-arbitrator to be appointed by the court, the decision of the court in this respect could hardly be questioned just because of the appearance of a new arbitrator. There is no need to assure him an influence over appointment of the super-arbitrator, since his predecessor with an analogous status failed to make use of his opportunity in this respect.

3. There may be various reasons for loss of force of an arbitration clause. In addition to the procedural grounds listed in Civil Procedure Code Art. 1168 (previously Art. 702 §1) and Art. 1195 §4 (previously Art. 707 §2), it could also involve such events as dissolution of the arbitration agreement, occurrence of a suspensory condition, or lapse of the deadline by which an arbitration award should have been issued. Termination of the agreement containing the clause does not in and of itself constitute such grounds, however. This rule is now stated clearly by Civil Procedure Code Art. 1180, but should not have been in doubt prior to adoption of that provision.

Case no.: IV CSK 292/08

Key issues: arbitrator, arbitration clause, arbitration court procedure, petition to set aside arbitration award

id: 20256

Polish Supreme Court judgment dated 26 November 2008 Case No. III CSK 163/08 »

1. [When the state court has set aside an arbitration award] it is necessary for the claimant to file a new claim before a new arbitration court, or at least a written declaration of assertion before such arbitration court of the claims in the previous scope or as amended. From such time (or, currently, from the date of service of such document on the opposing party, Civil Procedure Code Art. 1186), a new proceeding is commenced before the arbitration court which is not a continuation of the previous proceeding that resulted in the arbitration award that was set aside.

2. The petition to set aside the arbitration award ... dated 16 December 2006, filed under the new regulations, commenced a case before the state court to set aside the arbitration award, and under the rule set forth in Art. 2 of the amending act [Act dated 28 July 2005 Amending the Civil Procedure Code (Journal of Laws Dz.U. No. 178 item 1478)] it was conducted in accordance with the new regulations. This means that the petitioner should base it in procedural respects on the new regulations for such procedure provided in Part Five, Title VII of the Civil Procedure Code; however, because the subject of the petition is the award and the proceeding before the arbitration court conducted in accordance with the former regulations, on substantive legal grounds the petition may rely only on the former rules, because the arbitration court was required to apply those rules and not the new ones. The grounds for the petition should thus be based on the former regulations.

3. In light of the circumstances of conclusion of the agreement, its purpose, and the statements by the attorneys before the arbitration court ... and failure for nearly five years to assert the lack of an arbitration clause, the intent of the parties ... was, as correctly found by the courts of both instances, to submit disputes arising under the agreement to the arbitration court for resolution, and not only mediation. … This position ... does not lead to validation of the lack of an arbitration clause by the behaviour of the parties before the arbitration court and the state courts or to avoidance of the requirement for written form of an arbitration clause, but constitutes only an interpretation of the declarations of will of the parties concerning an unclear arbitration clause expressed in written form and made ... in accordance with the requirements of Civil Code Art. 65.

4. An arbitration court is not a “court” or “other state body or body of the public administration” within the meaning of Civil Procedure Code Art. 365 §1, nor is there another “instance provided by statute” in which an arbitration court is bound by the award by another arbitration court, even concerning the same parties and the same claims.

5. An arbitration award, insofar as it denies a petition in some part with legal finality, does not have res judicata effect within the meaning of Civil Procedure Code Art. 365.

Case no.: III CSK 163/08

Key issues: arbitration award, arbitration clause, arbitration court procedure

id: 20341

Szczecin Appellate Court judgment dated 23 April 2008 (Case No. I ACa 204/07) »

1. The issue of the scope of an arbitration clause involves interpretation of the declarations of will of the parties expressed in the document, where the main role is played by rules of linguistic meaning.

2. When considering a petition to set aside an arbitration award, the state court will examine the case only with respect to the grounds listed in Civil Procedure Code Art. 712 §§ 1 and 2. The ruling by the state court is limited in this case either to setting aside the arbitration award in whole or part, or denying the petition. ... The task of the court in a proceeding initiated by a petition to set aside an arbitration award is not to determine the merits of the matter that was previously resolved by the arbitration court, applying provisions of substantive and procedural law, but only to assess the justification for the petition under the grounds set forth in Civil Procedure Code Art. 712 §§ 1 and 2. The court with which a petition to set aside an arbitration award has been filed does not act as a court of second instance, authorized to review the merits of the case applying provisions of substantive law, but reviews the challenged award only from the perspective of the violations indicated in Civil Procedure Code Art. 712 §§ 1 and 2.

3. [Civil Procedure Code Art. 712 §1(2)] refers to the necessity to comply with the principle of the equality of the parties before the arbitration court, to hear them out, and the possibility for a party to address the evidence and allegations presented by the opposing party. As stated by the Supreme Court, only if the arbitration court did not hear the party at all or did not allow it to submit its allegations can it be said that the party was deprived of the opportunity to defend its rights.

4. Pursuant to the rule set forth in Civil Procedure Code Art. 705, in a proceeding before an arbitration court the parties have the right to establish the rules of procedure themselves. Their determination of the procedure may occur in the arbitration agreement or in an additional agreement, but no later than the time the proceeding is commenced. Lack of agreement by the parties means that the right to select the arbitration procedure passes to the arbitrators, as if they were assuming the rights of the parties.

5. A ruling by an arbitration court may not be challenged because of erroneous decision of the case in legal or factual terms. Violation of the law may be grounds for setting aside an arbitration award only if the content of the ruling violates the rule of law or principles of social coexistence. Assessment of whether the ruling violates the rule of law or principles of social coexistence is formulated narrowly, and such conclusion may be reached only if the arbitration award would result in a material violation of such principles.

Case no.: I ACa 204/07

Key issues: arbitration clause, arbitration court procedure, petition to set aside arbitration award

id: 20335

Warsaw Appellate Court judgment dated 16 April 2008 (Case No. I ACa 1334/07) »

1. It should be borne in mind that the arbitration court, which is not bound by provisions on procedure before the court (Civil Procedure Code Art. 1184 §2), has greater discretion than in a civil proceeding shaped by the Civil Procedure Code.

2. The arbitration court ... took evidence on its own initiative from the review of the websites and a review of the search capabilities of the Google Internet search engine with respect to the words in dispute ..., without being requested to do by the parties to the proceeding and without citing specific circumstances of the case justifying such initiative by the court, but in the view of the Appellate Court this does not constitute a serious violation of the adversary principle.

3. Taking evidence not in compliance with the rules set forth in Civil Procedure Code Art. 235–237 ... is not equivalent to violation of fundamental rules of procedure within the meaning of Civil Procedure Code Art. 1206 §1(4), which limits the ability to set aside an arbitration award to the principles of a fair trial and procedural violations material enough that they could influence the arbitration award.

4. An arbitration award will also be set aside if the award is contrary to fundamental principles of the legal order of the Republic of Poland. … This does not have to do with internal inconsistency of the form of the ruling, i.e. inconsistency between the specific parts of the ruling. This provision, which is an exception to the rule that when considering a petition to set aside an arbitration award, the state court generally does not review the resolution by the arbitration court on the merits, and in particular does not review whether the award is founded on the facts cited in the justification or whether such facts were correctly determined (as it is undisputed that arbitrators should have greater discretion than a state court in interpreting and applying the law), restricts substantive review of arbitration court rulings only to instances of violation of the principles of the legal order, i.e. instances where the effects of the arbitration court ruling would cause a material violation of such principles, which should be understood to mean the principles of the political and socioeconomic system. This means that the state court proper to consider the petition may not consider the substantive side of the dispute..., and an allegation of violation of specific provisions of substantive law may be effective only insofar as the violation of specific norms also violates the principles of the legal order.

Case no.: I ACa 1334/07

Key issues: arbitration court procedure, petition to set aside arbitration award

id: 20248

Polish Supreme Court judgment dated 6 March 2008 Case No. I CSK 445/07 »

1. An allegation under Civil Procedure Code Art. 712 §1(2) refers to deprivation of a party’s right to a defence only before the arbitration court, and thus it could not serve in this respect as independent and effective grounds for a cassation appeal, which may involve a challenge to the correctness of the proceeding before the state appellate court, but not in an arbitration proceeding.

2. There is a consensus that the authority to review [a ruling of an arbitration court by a state court] does not involve the issue of the correctness of the ruling in terms of its compliance with substantive law, or compliance with procedural regulations. The basis for such review may only be an aggravated violated of particular importance and weight—of the sort that also constitutes a violation of the rule of law. By no means may such review turn into a form of appellate review of the merits.

3. A petition to set aside an arbitration award is in ... the nature of an extraordinary legal instrument based on very narrowly defined grounds, which do not include undue explanation of the circumstances necessary to resolve the matter. Thus it must be concluded that violation of Civil Procedure Code Art. 705 §2, third sentence, may also provide grounds for a petition under Civil Procedure Code Art. 712 §1(4) only when it is of an extreme nature, and thus when it takes the form of complete omission of an explanation of the circumstances of the case or ignoring the evidence as a whole.

4. An arbitration court may not take into consideration facts not cited by the parties, or presume that the claimant’s allegations are true if the claimant fails to appear at the hearing, or assume facts to be true if they are not denied.

Case no.: I CSK 445/07

Key issues: arbitration court procedure, petition to set aside arbitration award

id: 20244

Polish Supreme Court order dated 29 November 2007 Case No. III CSK 176/07 »

1. Arbitration is a procedure for resolving civil disputes by a decision-making body that is not a state court, but its jurisdiction is based on an agreement of the parties. For this reason, Art. 45 of the Polish Constitution, which refers to state bodies of the justice system identified in Constitution Art. 175(1), does not apply directly to arbitration.

2. When considering a case, an arbitration court is not bound by general regulations of procedural law applicable in a judicial proceeding, if the parties or the arbitration court have not otherwise provided for the procedure.

3. The indication in the second sentence of Civil Procedure Code Art. 1184 §2 that an arbitration court is not bound by judicial procedure regulations does not refer to mandatorily applicable provisions of the Civil Procedure Code governing procedure before the arbitration court. … Unless otherwise agreed by the parties, the arbitration court may conduct the proceeding as it deems fit, but subject to the provisions of the act. The rule of the priority of the intent of the parties in establishing the arbitration procedure, under Civil Procedure Code Art. 1184 §1, is subject to a limitation in that their selected manner of proceeding before the arbitration court may not be contrary to provisions of the law of the state which they selected that are in force in such a proceeding. The wording of Art. 1184 §1 (“if not otherwise provided by the act”) means that the parties may not, by their intent, change or exclude such provisions, and thus they are regulations of mandatory applicability [juris cogentis].

4. A state court considering a case upon a petition to set aside an arbitration award does not decide the dispute between the parties, and thus does not assess whether the arbitration court decided the case correctly in factual or legal terms, but only examines it from the point of view of grounds to set aside the award set forth in Civil Procedure Code Art. 1206.

5. Violation by the arbitration court of rules and regulations of the Civil Procedure Code binding on it governing arbitration procedure may provide grounds for a petition to set aside the arbitration award on the basis of failure to comply with fundamental rules of procedure before such court, arising under the act referred to in Civil Procedure Code Art. 1206 §1(4).

Case no.: III CSK 176/07

Key issues: arbitration court procedure, petition to set aside arbitration award

id: 20238

Polish Supreme Court judgment dated 20 June 2007 Case No. V CSK 126/07 »

1. Under Art. 2 of the amending act [i.e. the Act dated 28 July 2005 Amending the Civil Procedure Code, Journal of Laws Dz.U. No. 178 item 1478], proceedings before arbitration courts and proceedings before courts for recognition or enforcement of an arbitration award, as well as a petition to set aside an arbitration award, commenced prior to the effective date of the act, are conducted in accordance with the prior regulations.

2. The view of the petitioner cannot be upheld under which [the other party], pursuant to Civil Procedure Code Art. 4791⁴ §2, was required to assert the defence of the lack of the required power of attorney in the response to the petition filed with the arbitration court, at the latest. Under Civil Procedure Code Art. 705, in a proceeding before an arbitration court, the parties themselves could, up until commencement of the proceeding, establish the procedure that should be applied in consideration of the case, and if they failed to do so, the arbitration court applied the procedure that it saw fit and was not bound in this respect by civil procedure regulations.

Case no.: V CSK 126/07

Key issues: arbitration court procedure, arbitration clause

id: 20232

Supreme Court judgment dated 13 December 2006 Case No. II CSK 289/06 »

1. The arbitration court is subject only to the provisions of the Civil Procedure Code that govern procedure before the arbitration court. For this reason, a violation of general provisions of civil procedure law or overriding principles of civil procedure may serve as grounds for setting aside an arbitration award only if it results in violation of fundamental principles of the legal order of the Republic of Poland or principles of social coexistence.

2. A violation of the rule of law or principles of social coexistence as referred to in Civil Procedure Code Art. 712 §1(4) must be part of the content of the ruling itself, and thus it is insufficient if the violation occurred in the proceeding before the arbitration court.

3. If the arbitration court ignores evidence offered by a party because the arbitration court deemed the evidence unnecessary, that will not be regarded as depriving the party of a defence. The state court’s review of whether the arbitration court correctly found the evidence to be unnecessary would constitute impermissible intrusion into the merits of the case.

Case no.: II CSK 289/06

Key issues: arbitration court procedure, petition to set aside arbitration award

id: 20289

Warsaw Appellate Court judgment dated 8 November 2006 Case No. I ACa 792/06 »

1. As a rule, the right to a defence in a proceeding before an arbitration court may also be violated by preventing proof of allegations or defences. Mere submission of statements and expression of a position is primarily relevant to explanation and interpretation of legal issues, and may be insufficient for establishing the factual grounds for a decision which is after all not subject to appellate review. It should be added that this has to do with proof of circumstances that in the view of the arbitration court are highly relevant to the decision.

2. The rules of the arbitration court did not provide for expansion of the statement of claim, nor did they prohibit it. In such case, the inability to repeat the procedure for selection of arbitrators should, in the view of the Appellate Court, be assessed in light of the type of demand. If this really had to do with a claim not related to the existing claim, but requiring special qualifications of the panel, it could be concluded that there was an infringement of fundamental rules of procedure resulting in setting aside of the award in such part.

3. An untrue statement in a document later offered in evidence by a party is not ... grounds for a petition to set aside an arbitration award under Civil Procedure Code Art. 1206 §1(5).

4. An arbitration court is not bound by provisions of substantive law. This means that arbitration awards may be reviewed only within a limited scope. Setting aside an arbitration award is thus justified only by an infringement of substantive law that would also bring the decision into conflict with the overriding legal principles in force in the Republic of Poland. In other words, an arbitration award may be unlawful if it results in a decision that violates controlling principles of the rule of law.

5. Existence of the grounds set forth in Civil Procedure Code Art. 1206 §2(2) is not determined by the number of provisions violated but by the relation between a specific violation of law to the narrowly defined principles of the legal order of the Republic of Poland.

Case no.: I ACa 792/06

Key issues: arbitration court procedure, petition to set aside arbitration award

id: 20287

Poznań Appellate Court judgment dated 11 May 2006 Case No. I ACa 1279/05 »

1. An arbitration agreement, even when set forth in a clause in the “main” agreement, is not a provision of the underlying contract and thus its effectiveness is considered independently.

2. In order to make an arbitration agreement, a generic power of attorney is sufficient (specifying the type of actions which the attorney-in-fact is authorized to take), or a general power of attorney if making the arbitration agreement may be deemed to be an act within the ordinary course of business.

3. The importance of an arbitration agreement concerning a specific legal relationship is a reflection of the importance of the legal relationship subject to the arbitration agreement. There are no grounds for finding that contractual exclusion of the jurisdiction of the state courts, even in the case of a matter that is petty in relation to the subject of the enterprise, is outside the ordinary course of business. Such assumption would hinder the parties’ ability to submit a dispute to the jurisdiction of the arbitration court, which would be inconsistent with the requirements of commerce, and would also create uncertainty in trade. Similarly, an arbitration agreement may be concluded on the basis of a generic power of attorney, which should specify the type of legal acts included within the authority as well as the subject matter. If the type of legal acts was not clearly defined, the canons for interpretation of declarations of will (Civil Code Art. 56 and 65) are applicable in order to determine the true intent of the principal.

4. Under Civil Procedure Code Art. 712 §1(3), a party may seek to set aside an arbitration award if procedures were not followed before the arbitration court as determined by the parties or by the law, particularly provisions concerning the composition of the arbitration court, voting, removal of an arbitrator, and the award. There could be no violation of the procedure established by the parties when, as the appellant itself states, the parties did not establish any procedure. Only establishing the procedure in the agreement creates a duty on the part of the arbitrators to comply with the procedure, under sanction of setting aside the arbitration award if the procedure is not followed (Civil Procedure Code Art. 705 §1 and Art. 712 §1(2)). Otherwise, the arbitration court will apply the procedure it deems fit (Civil Procedure Code Art. 705 §2).

Case no.: I ACa 1279/05

Key issues: arbitration court procedure, arbitration clause

id: 20218

Supreme Court judgment dated 11 August 2005 (Case No. V CK 86/05) »

1. The limitation of the scope of review of an arbitration award to the grounds set forth in the act, but also those on which the petition to set aside the arbitration award is based, is subject to the exception of the duty of the [state] court, expressly provided in Civil Procedure Code Art. 714, to review on its own motion whether a violation of law by the arbitration court resulted in issuance of an award that violates the legal order or principles of social coexistence.

2. In a proceeding to set aside an arbitration award, the subject of the case is clearly the review of the award within the grounds of the mandatory provisions of the Civil Procedure Code, and the subject of the proceeding may not be regarded as falling within the scope of the business activity of any business entities.

3. A proceeding to set aside an arbitration award is a distinct type of proceeding, containing elements of a cassation proceeding, but the reference set forth in the mandatorily applicable rule of Civil Procedure Code Art. 715 does not justify application, even only as relevant, of the code provisions concerning the procedure in commercial cases, because the subject matter and function of the two types of proceedings are completely different.

Case no.: V CK 86/05

Key issues: arbitration court procedure, petition to set aside arbitration award

id: 20200

Polish Supreme Court resolution dated 26 November 2003 Case No. III CZP 83/03 »

1. An arbitration court is not bound by the civil procedure regulations, but may not avoid conducting a thorough examination of the circumstances necessary to decide the case. Thus it is stated in the literature that in a proceeding before an arbitration court the provisions of the Civil Procedure Code concerning appointment of attorneys do not apply, and more specifically it is possible to appoint as attorneys persons other than those referred to in Civil Procedure Code Art. 87, and moreover there is no specific form required for a power of attorney to appear before an arbitration court, and the scope, duration and effects of the appointment should be assessed pursuant to civil law.

2. In an arbitration clause the parties may exclude representation by an attorney and require participation in person before the arbitration court.

3. With respect to service, it is accepted ... that the arbitration court is not bound by the procedure or form for service provided in the Civil Procedure Code and may use the procedure for summoning parties, witnesses and experts that it deems proper and effective. This applies as well to service of an arbitration award under Civil Procedure Code Art. 709. While not bound by provisions of the Civil Procedure Code, the arbitration court must nonetheless insure procedural rules that afford the party an opportunity to present a defence.

4. In a public procurement procedure conducted under the Public Procurement Law dated 10 June 1994 (unified text at Journal of Laws Dz.U. 2002 No. 72 item 664, as amended), the award by a panel of arbitration shall be served on appointed counsel.

arbitration court procedure

All documents for the issue: 177

Polish Supreme Court judgment dated 28 January 2011 (Case No. I CSK 231/10) »

Polish Supreme Court judgment dated 16 December 2010 (Case No. I CSK 112/10) »

Polish Supreme Court judgment dated 9 September 2010 Case No. I CSK 535/09 »

Szczecin Appellate Court judgment dated 27 May 2009 (Case No. I ACa 177/09) »

Polish Supreme Court judgment dated 27 November 2008 Case No. IV CSK 292/08 »

Polish Supreme Court judgment dated 26 November 2008 Case No. III CSK 163/08 »

Szczecin Appellate Court judgment dated 23 April 2008 (Case No. I ACa 204/07) »

Warsaw Appellate Court judgment dated 16 April 2008 (Case No. I ACa 1334/07) »

Polish Supreme Court judgment dated 6 March 2008 Case No. I CSK 445/07 »

Polish Supreme Court order dated 29 November 2007 Case No. III CSK 176/07 »

Polish Supreme Court judgment dated 20 June 2007 Case No. V CSK 126/07 »

Supreme Court judgment dated 13 December 2006 Case No. II CSK 289/06 »

Warsaw Appellate Court judgment dated 8 November 2006 Case No. I ACa 792/06 »

Poznań Appellate Court judgment dated 11 May 2006 Case No. I ACa 1279/05 »

Supreme Court judgment dated 11 August 2005 (Case No. V CK 86/05) »

Polish Supreme Court resolution dated 26 November 2003 Case No. III CZP 83/03 »

Polish Supreme Court order dated 2 April 2003 Case No. I CK 287/02 »

Warsaw Appellate Court judgment dated 29 May 2000 Case No. I ACa 65/00 »

Polish Supreme Court judgment dated 16 May 1997 Case No. I CKN 205/97 »

Judgment of the Court of Justice of 23 March 1981, C-102/81, Nordsee Deutsche Hochseefischerei GmbH v Reederei Mond Hochseefischerei Nordstern AG & Co KG »

Polish Supreme Court judgment dated 21 December 1973 Case No. I CR 663/73 »

id: 20114 Polish Supreme Court judgment dated 22 December 1970 Case No. III CRN 327/70 »

Polish Supreme Court resolution dated 3 April 1957 Case No. I CO 4/57 »