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: 20294

Warsaw Appellate Court order dated 24 September 2009 Case No. I ACa 995/08 »

1. The New York Convention does not contain provisions indicating the form in which the parties should make a choice of law governing the arbitration clause. Art. V(1)[(a)] of the New York Convention does not require that the choice of law governing the arbitration clause be made in writing. The term “indication” should be interpreted to mean behaviour by a person in the form of writing, or any other behaviour that sufficiently reveals the person’s intent. Art. VI(2) of the European Convention on International Commercial Arbitration made at Geneva on 21 April 1961 uses the term “indication” without specifying the form, and thus “indication” should be interpreted as any behaviour by the parties indicating their joint intent.

2. It is not possible to conclude a settlement where, based on the nature of the disputed legal relations, the parties cannot freely dispose of the rights. Thus the appellate court holds that a dispute over the effectiveness of an agreement on sale of shares in a limited-liability company is not arbitrable.

3. The plaintiff determines who is a party when it initiates a dispute. The attribute of being a party is purely formal in nature and is not tied to the existence of a substantive legal claim, nor does it determine the jurisdiction of the arbitration court to decide the merits of the case. In a case where the arbitration court finds that it lacks jurisdiction over a “party,” it cannot be inferred that the ruling on the merits of the dispute is binding on that party. The party was not a party to the dispute on the merits because the arbitration court did not have jurisdiction over it.

4. Assessment of procedural acts of the parties in an arbitration proceeding lies within the power of the arbitration court, and a court ruling on recognition of an award may not make assessments contrary to that of the arbitration court, or assessments under the Polish Civil Procedure Code, which was not applicable in the proceeding before the arbitration court.

5. The state court is bound by the ruling of the arbitration court concerning its lack of jurisdiction to resolve specific disputes, regardless of whether the arbitration court’s interpretation of the scope of the arbitration clause was correct or not. It is clear that the arbitration court is authorized to rule on its own jurisdiction.

6. In order to decide on its jurisdiction, the arbitration court must consider the grounds for or against its jurisdiction. This cannot mean, however, that in cases in which the same issues are decisive of both the jurisdiction of the arbitration and the resolution on the merits the authority to resolve the issue of jurisdiction is also authority to decide the merits of the dispute. Otherwise the party would de facto be deprived of the ability to effectively assert the defence of lack of jurisdiction on the part of the arbitration court.

7. None of the provisions of law providing the arbitration court the authority to decide on its jurisdiction and analyze all factual and legal issues necessary to perform this task provides it a priori authority to decide the merits of the case. If the jurisdictional determination is negative, the arbitration court must refrain from deciding the merits of case. Review of the merits in such instance serves only as a basis for the jurisdictional ruling.

8. It is impermissible that res judicata effect of a ruling by the arbitration court would exert effects in Poland with respect to persons not covered by the legal finality of such ruling in the country of origin.

Case no.: I ACa 995/08  

Key issues: arbitrability of dispute, arbitration clause, jurisdiction of arbitration court, recognition and enforcement of foreign arbitration award

id: 20260

Polish Supreme Court order dated 5 February 2009 Case No. I CSK 311/08 »

Submission to an arbitration court of disputes under a contractual relationship means that the jurisdiction of the arbitration court extends to any and all claims for performance of the contract, claims arising in the event of non-performance or improper performance of the contract, claims to restore undue consideration arising in the event of invalidity of the contract or rescission of the contract, as well as tort claims if they arise out of an event that also constitutes non-performance or improper performance of the contract.

Case no.: I CSK 311/08  

Key issues: jurisdiction of arbitration court, arbitration clause

id: 20224

Supreme Court order dated 17 May 2006 Case No. I CSK 16/06 »

1. Mere assertion of the defence of the existence of an arbitration clause is not grounds in any event for dismissal of a statement of claim. In order to have that effect, the defence must be justified, which is subject to the assessment of the court.

2. The task of the court is to clarify whether the resolution of the case rests with the arbitration court, which also includes assessment of the validity of the arbitration clause.

Case no.: I CSK 16/06  

Key issues: jurisdiction of arbitration court, arbitration clause

id: 20213

Supreme Court resolution dated 24 February 2005 (Case No. III CZP 86/04) »

1. The defence of an arbitration clause concerning the legal relationship between the issuer of a promissory note and the payee is also effective with respect to the issuer of the promissory note when, alongside the issuer of the note, the guarantor of the promissory note, who was not a party to the agreement submitting the dispute for resolution by the arbitration court, is also a defendant.

2. A promissory note obligation may be subject to an arbitration clause.

3. The effect of shifting the dispute onto the general ground of civil law, meaning that the resolution of the dispute requires assessment of the justification of the claim in light of the “underlying relationship” in connection with which the promissory note was issued, does not occur by the mere fact of filing defences to the order for payment. This effect depends on whether the interested party takes the relevant actions, and the court has no duty to act in this respect on its own initiative. The actions taken by the party may consist of the defendant’s assertion of defences to an order for payment with respect to the lack of grounds for the claim pursued based on the underlying relationship, or the plaintiff’s assertion, in the statement of claim or in the proceeding conducted as a result of assertion of defences to the order for payment, of allegations justifying the claim asserted also on the basis of the underlying relationship.

4. In the event of lack of actions by the parties causing the dispute to be shifted to the general ground of civil law, the dispute in the proceeding conducted pursuant to the defences against the order for payment is subject to consideration under the promissory note relationship.

5. A promissory note guarantor may defend against the holder of the note with all defences available to the person for whom he issued the guarantee, but this applies only to substantive defences (Art. 32 of the Promissory Note Law dated 28 April 1936, Journal of Laws Dz.U. 1936 No. 37 item 282), but the defence of an arbitration clause is a procedural defence. Without being a party to the agreement ... containing the arbitration clause, the defendant cannot assert the arbitration clause.

6. Civil Procedure Code Art. 72 §3 cannot be interpreted as a provision that changes the consequences of the lack of procedural grounds, and specifically as eliminating the effectiveness of an arbitration clause. If the clause is effective with respect to one substantive co-party, of any type, but is not effective with respect to the other co-party, the case with respect to the first co-party cannot be considered at all by the state court, and the statement of claim in this respect is subject to dismissal; however, with respect to the other co-party, the case is subject by consideration by the state court.

Case no.: III CZP 86/04  

Key issues: arbitrability of dispute, arbitration clause, jurisdiction of arbitration court

id: 20197

Polish Supreme Court order dated 8 August 2003 Case No. V CK 486/02 »

1. The condition for the effectiveness of an arbitration clause under [Civil Procedure Code Art. 1105 §2] of the “foreign status” of at least one of the parties refers to the stage of conclusion of the forum selection agreement, and thus has to do with the parties to that agreement and not the parties to the dispute covered by the arbitration clause. The purpose of the forum selection clause is to submit future property disputes to an arbitration court (Civil Procedure Code Art. 697 in connection with Art. 1105 §2), and thus the effectiveness of the clause referring to an arbitration court operating abroad is determined by the forum selection agreement establishing such clause, so long as the limiting conditions listed in Civil Procedure Code Art. 1105 §2 are met at the time of conclusion of the agreement.

2. The necessity to examine the legal force and effectiveness of an arbitration clause, but according to the state of facts as of the date of conclusion of the forum selection agreement, may lead to a situation in which a foreign arbitration court will be proper to decide the dispute even though as of the date of commencement of the dispute the parties to the dispute no longer meet any of the characteristics of “foreignness” listed in Civil Procedure Code Art. 1105 §2, i.e. having a registered office abroad or operating an enterprise abroad which is connected with the dispute....

Case no.: V CK 486/02  

Key issues: jurisdiction of arbitration court, arbitration clause

id: 20182

Polish Supreme Court order dated 15 December 2000 Case No. I CKN 1131/00 »

1. The ability for the dispute to be heard by the state court is excluded so long as the parties are bound by an arbitration clause. The Civil Procedure Code expressly mentions only two situations in which an arbitration clause loses force (Art. 702 §1 and 707 §2). There is no doubt, however, that this may occur also in other instances, specifically if a written agreement is concluded dissolving the clause.

2. If the parties were bound by a cooperation agreement which contains an arbitration clause, the original arbitration clause remains valid following lapse of a settlement agreement submitting enforcement of a specific claim to the state courts.

Case no.: I CKN 1131/00  

Key issues: jurisdiction of arbitration court, arbitration clause

id: 20172

Polish Supreme Court order dated 16 March 2000 Case No. I CKN 1507/99 »

1. Exclusion of the jurisdiction of the court and submission of a specific dispute to the jurisdiction of the arbitration court is determined by the agreement of the parties—concluded within the framework laid down by law. With respect to the form of such contract, under the requirements of Civil Procedure Code Art. 698 §1 and Art. 1105 §2, it must be a written agreement. While both of those regulations refer to conclusion of an agreement by the parties, ... when the agreement provides for the possibility of accession to the agreement by new entities, if they make such accession such entities are bound by the contents of the entire agreement, including the arbitration clause. ... When acceding to such agreement, the new entities need not conclude a separate agreement with respect to the arbitration clause, as the declaration of the intention of accession, made in writing, also means acceptance of the arbitration clause included in the agreement. The requirement with respect to the content and the form of such agreement is thus fulfilled.

2. A foreign arbitration court may be competent to resolve a dispute between entities that do not meet any of the characteristics of “foreignness” mentioned in Civil Procedure Code Art. 1105 §2, i.e. a registered office abroad, Or operating an enterprise there which is connected with the dispute that has been instituted. … Fulfilment of such requirements, i.e. the foreign element, by any of the parties is determined as of the time of conclusion of the jurisdictional agreement, and not as of the time of commencement of the dispute between the parties who are bound by the arbitration clause.

Case no.: I CKN 1507/99  

Key issues: jurisdiction of arbitration court, arbitration clause

id: 20160

Polish Supreme Court judgment dated 16 February 1999 Case No. I CKN 1020/98 »

1. An agreement vesting jurisdiction in a foreign court or an arbitration court operating abroad (Civil Procedure Code Art. 1105 §§ 1 and 2) must be preceded by the existence of domestic jurisdiction. Exclusive jurisdiction of a Polish court may, however, constitute a barrier to effective conclusion of an agreement on jurisdiction. But such barrier functions only with respect to vesting jurisdiction in a foreign state court (Civil Procedure Code Art. 1105 §1, second sentence) and does not apply with respect to vesting jurisdiction in a foreign arbitration court, which is subject only to the limitations provided in Civil Procedure Code Art. 697 §1.

2. The requirement of “foreign status” of one of the parties as a condition for the permissibility of an arbitration clause as provided for in Civil Procedure Code Art. 1105 §2, refers to the phase of conclusion of the agreement on jurisdiction, and thus applies to the parties to such agreement and not the parties to the dispute covered by the arbitration clause.

3. Civil Procedure Code Art. 1105 §2 also applies to multilateral agreements. ... In the case of a multilateral agreement, it may happen that a foreign arbitration court has jurisdiction to hear a dispute between parties that are domestic entities.

Case no.: I CKN 1020/98  

Key issues: arbitration clause, jurisdiction of arbitration court, New York Convention

id: 20153

Polish Supreme Court order dated 14 July 1998 Case No. III CKN 548/98 »

1. Submission of a dispute for resolution by an arbitration court does not definitively exclude the jurisdiction of the state court. The proceeding before the arbitration court constitutes only a fragment of the entire system of protection of the interests of the claimant.

2. The position that a proceeding before the state court, initiated by filing of a motion for interim relief to secure a claim which will be pursued before the arbitration court, becomes an independent case within the meaning of Civil Procedure Code Art. 392 §1 is indefensible. Such proceeding remains a proceeding in which only a certain incidental issue is resolved. The ruling that is issued does not end the proceeding “in the case” even though it ends the proceeding initiated by the motion for interim relief. Only the arbitration award will be a ruling ending the case as a certain entirety submitted for judgment. An interim order issued by the state court concerning security for the claim is a ruling that resolves only an incidental issue.

Case no.: III CKN 548/98  

Key issues: state court assistance, jurisdiction of arbitration court

id: 20272

Poznań Appellate Court judgment dated 23 May 1996 Case No. I ACr 189/96 »

1. Recusal of an entire court may not be demanded, but only recusal of specific judges (one or more of them), identified by name, but this does not mean that in this case the arbitration court itself could determine that the motion by the defendant should not be granted. The province court correctly stated that the arbitration court may not decide a motion to recuse an arbitrator, either on the merits or on procedural grounds, even if the motion was clearly unjustified or late.

2. The ruling issued as a result of a petition to set aside an arbitration award is in the nature of cassation, and thus the state court may only set aside the award or deny the petition, and may not rule on the merits. In consequence, when the state court sets aside an arbitration award by granting a petition under Civil Procedure Code Art. 712 §1(2)–(5), the arbitration court retains its jurisdiction to decide the dispute.

Case no.: I ACr 189/96  

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

id: 20271

Białystok Appellate Court order dated 29 February 1996 Case No. I ACz 69/96 »

The parties and the arbitration court itself are given great discretion to determine the procedure before the arbitration court, although the Civil Procedure Code does establish certain minimum rules that are mandatorily applicable (juris cogentis).

Case no.: I ACz 69/96  

Key issues: jurisdiction of arbitration court, arbitration clause

id: 20122

Polish Supreme Court order dated 7 March 1979 Case No. III CRN 10/79 »

1. Which cases that are subject to consideration by the state courts may be submitted to arbitration is determined by the regulations governing arbitration proceedings.

2. Issuance of an enforcement clause must be preceded by a legally final ruling by the state court, pursuant to Civil Procedure Code Art. 711, confirming the enforceability of the arbitration award.

3. The only cases falling under the non-adversarial procedure that may be heard by an arbitration court are those rather rare cases whose nature allows for this, that is, those that meet the grounds [for arbitrability] provided in Civil Procedure Code Art. 697 §1.

4. Under current law, adversarial and non-adversarial proceedings are parallel tracks for judicial proceedings, and the non-adversarial procedure in property matters in which the court commences the proceeding upon application is not so different from the rules applicable in an adversarial proceeding that mere submission of a given matter to resolution through the non-adversarial procedure results in exclusion of the possibility of submitting such matter to an arbitration court for resolution.

Case no.: III CRN 10/79  

Key issues: recognition and enforcement of domestic arbitration award, jurisdiction of arbitration court, arbitration clause, arbitrability of dispute

id: 20105

Polish Supreme Court order dated 22 April 1966 Case No. I CR 433/64 »

The wording of §14 of the Transport Protocol on Polish-Czechoslovakian Cooperation for 1961, “When entering into any agreements, ... the interested enterprises ... shall stipulate the jurisdiction of the International Court of Arbitration in Gdynia for resolution of any possible disputes,” does not justify the conclusion that this provision submits all such future disputes identified therein to resolution by the arbitration court.

Section 14, as its wording indicates, only imposes on the enterprises of both of the contracting states the duty to include arbitration clauses in the agreements they conclude, and thus the position taken in the order appealed from is correct, that because the charter party binding on the parties does not contain such clause, this dispute is subject to the jurisdiction of the common court.

Case no.: I CR 433/64  

Key issues: jurisdiction of arbitration court, arbitration clause