1. [S]etting a time limit for the parties to submit evidence motions within an indicated period of time under pain of disregarding late evidence and statements cannot be deemed as an infringement of a party’s right to substantiate their statements.
2. When assessing whether a party was deprived of the opportunity to defend its rights in the proceedings before an arbitral tribunal, one should consider the course of the arbitration proceedings, also bearing in mind that the court is not authorized to review the ruling made on the merits and that in making an arbitration agreement the parties consciously waived submission to the strictures in place for proceedings before a state court.
3. It is not unreasonable to state that by concluding an arbitration agreement, the parties limit their constitutional and conventional right to court.
4. A party is deprived of the opportunity to defend its rights before an arbitral tribunal when the principle of equality of the parties has been violated, one of the parties is not heard and does not have the opportunity to address the evidence or allegations presented by the opposing party. For these reasons, every instance in which an arbitral tribunal refuses to admit evidence sought by a party cannot be equated with the party being deprived of the opportunity to defend itself. This happens only when a party has no opportunity to present and argue for its position. … . An arbitral tribunal is authorized to refuse to admit evidence motions of the parties and such a procedural decision does not constitute grounds to deem that the parties have been deprived of the opportunity to defend themselves.
5. It cannot be assumed that an arbitration award is in breach of the public policy clause only because the arbitration award is not complaint with certain provisions of substantive law.
6. Possible irregularities in application by an arbitral tribunal of Art. 484 § 2 of the PCPC, not leading in themselves to the arbitration award being contrary to the fundamental principles of the legal order, cannot be relevant in proceedings initiated by a petition to set aside the arbitration award… .
Publication date: 28-10-2022 | Case no.: I AGa 332/21Key issues: arbitration agreement, petition to set aside arbitration award
1. [A]n arbitration agreement is an agreement governed by the directives set out in Art. 65 of the Polish Civil Code… .
2. The indication of a permanent court of arbitration or an expression of will to refer a case to an ad hoc arbitral tribunal constitute essentialium negotii of an arbitration clause and lack thereof renders the arbitration agreement invalid or unenforceable – which shall be examined a casu ad casum.
3. An arbitration agreement that is vague, internally contradictory, which makes it impossible to determine, in a way of interpretation, the court of arbitration chosen by the parties shall be deemed unenforceable.
4. [C]onversion, in a way of interpretation, of an unenforceable or invalid arbitration agreement indicating a permanent court of arbitration into an effective arbitration agreement regarding an ad hoc arbitral tribunal is excluded. Conclusion of an arbitration agreement indicating a permanent court of arbitration is usually dictated by the characteristics of a specific arbitration institution, therefore there is no basis for finding that an arbitration agreement regarding an ad hoc arbitral tribunal may perform a substitute function for an arbitration agreement to refer a dispute to a particular arbitration institution… .
5. In the process of interpretation of an arbitration agreement, a state court cannot refrain from indicating the court of arbitration that is to hear a case. The possible unenforceability of such an agreement opens the way to having the case heard by a state court (Art. 1165 § 2 of the PCPC).
6. The predominant… view is that conclusion of an arbitration agreement does not exclude the filling, with a state court, of a motion for an attempt at settlement.
Publication date: 27-10-2022 | Case no.: II CSKP 470/22Key issues: arbitration agreement
1. Only in the situation when the assessment made by the state court that the effects of the arbitration award are grossly and plainly contrary to the fundamental principles of the legal order of the Republic of Poland, it is possible to find a petition to set aside an arbitration award based on the allegation of violation of Art. 1206 § 2 point 2 of the PCPC to be well-founded. In applying the public policy clause, the point is not that the ruling being reviewed is to be consistent with all of the mandatorily applicable provisions of law entering into play, but that it does not exert an effect inconsistent with the fundamental principles of the domestic legal order.
2. The Court of Appeal examining the legitimacy of a petition to set aside an arbitration award cannot change such an award, but only dismiss the petition or set aside the award.
3. [A] basis for setting aside an arbitration award may be … aggravated violations of substantive or procedural law which render the arbitration award irreconcilable with the legal standards deemed fundamental for the functioning of the legal system as such. Therefore, neither a mere misinterpretation of the substantive law nor a misapplication thereof by an arbitral tribunal justifies upholding of the petition even if mandatorily applicable provisions were violated… .
4. [A]n assessment as to whether an arbitration award violates the fundamental principles of the legal order shall be formulated narrowly and on the basis of factual circumstance of a given case.
Publication date: 26-10-2022 | Case no.: V AGa 163/22Key issues: petition to set aside arbitration award
1. In the course of proceedings initiated by a petition to set aside an arbitration award, the role of a state court is not to examine the compliance of the arbitration award with the substantive law applicable to the case. The task of the state court is only to examine whether in the case a statutory ground for setting aside of the arbitration award exists… .
2. A state court considering a petition to set aside an arbitration award examines only the circumstances indicated in Art. 1206 § 1 of the PCPC, if the petition relies on them, and ex officio, examines the circumstances specified in Art. 1206 § 2 of the PCPC… .
3. An arbitration award shall be set aside under the public policy clause, if the violation of the substantive law by the arbitral tribunal leads to consequences irreconcilable with the fundamental principles of the Polish legal system, that is, effects that are plainly and grossly contrary to such principles or to any one of them… .
Publication date: 13-09-2022 | Case no.: II CSKP 709/22Key issues: petition to set aside arbitration award
1. [I]t cannot be accepted that an arbitration award violates the public policy clause solely on the ground that the award is not consistent with certain provisions of substantive law… . It should be stated that a violation of substantive law can be found to be a ground for setting aside an arbitration award only when it is contrary to the constitutional principle of the state of law (Art. 2 of the Constitution of the Republic of Poland). … a conclusion that the principles of legal order have been violated is justified, if as a result of an arbitration award the fundamental principles of the state and law are infringed (Art. 1206 § 2 point 2 of the PCPC).
2. The “public policy clause”, like any other general clause, is not precisely defined, which leaves a court seized of a particular case with a wide range of discretion, however, on the basis of this clause, review of the constitutive elements of an arbitration award may not take on the dimensions proper for a review of the merits (correctness) of the award. The prohibition of a review of the merits of an award is related to the essence of the application of the public policy clause. By application thereof, the point is not to determine whether the award is consistent with all relevant mandatorily applicable legal regulations, but only to determine whether the award effected a result contrary to the fundamental principles of the domestic legal order.
3. The procedural public policy may be the basis for assessment of an arbitration award in two aspects. Firstly, the procedure which led to the delivery of the arbitration award is assessed for its compliance with the fundamental procedural principles of the legal order. Secondly, the effects of the arbitration award are assessed from the perspective of their consistency with the procedural public policy, i.e. whether they are compatible with the procedural legal system, for example, whether they do not infringe res iudicata or the rights of third parties.
4. A state court, hearing a petition to set aside an arbitration award, does not examine the case on the merits, but only examines the circumstances indicated in Art. 1206 § 1 of the PCPC, if the petitioner relies on them and the circumstances provided for in Art. 1206 § 2 of the PCPC ex officio… .
Publication date: 08-07-2022 | Case no.: II CSKP 349/22Key issues: petition to set aside arbitration award
1. Article 34(3) of Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters must be interpreted as meaning that a judgment entered by a court of a Member State in the terms of an arbitral award does not constitute a ‘judgment’, within the meaning of that provision, where a judicial decision resulting in an outcome equivalent to the outcome of that award could not have been adopted by a court of that Member State without infringing the provisions and the fundamental objectives of that regulation, in particular as regards the relative effect of an arbitration clause included in the insurance contract in question and the rules on lis pendens contained in Article 27 of that regulation, and that, in that situation, the judgment in question cannot prevent, in that Member State, the recognition of a judgment given by a court in another Member State.
2. Article 34(1) of Regulation No 44/2001 must be interpreted as meaning that, in the event that Article 34(3) of that regulation does not apply to a judgment entered in the terms of an arbitral award, the recognition or enforcement of a judgment from another Member State cannot be refused as being contrary to public policy on the ground that it would disregard the force of res judicata acquired by the judgment entered in the terms of an arbitral award.
3. [S]ince Regulation No 1215/2012 repealed and replaced Regulation No 44/2001, which itself replaced the Convention of 27 September 1968 on jurisdiction and enforcement of judgments in civil and commercial matters (…), as amended by successive conventions on the accession of new Member States to that convention, the Court’s interpretation of the provisions of one of those legal instruments also applies to those of the others, whenever those provisions may be regarded as equivalent (…).
Publication date: 20-06-2022 | Case no.: C-700/20Key issues: arbitration award
In applying the criterion of the public policy clause, the point is not that the ruling being reviewed is to be consistent with all of the mandatorily applicable provisions of law entering into play, but that it does not exert an effect inconsistent with the fundamental principles of the domestic legal order… .
Publication date: 02-02-2022 | Case no.: V AGa 67/21Key issues: petition to set aside arbitration award
[A]rticles 267 and 344 TFEU must be interpreted as precluding a provision contained in an international agreement concluded between two Member States under which an investor from one of those Member States may, in the event of a dispute concerning investments in the other Member State, bring proceedings against the latter Member State before an arbitral tribunal whose jurisdiction that Member State has undertaken to accept… .
Publication date: 25-01-2022 | Case no.: C-638/19 PKey issues: arbitration agreement, investment arbitration, jurisdiction of arbitral tribunal
Judgment of the Court of Justice of 26 October 2021, C-109/20, Republic of Poland v PL Holdings Sarl
Articles 267 and 344 TFEU must be interpreted as precluding national legislation which allows a Member State to conclude an ad hoc arbitration agreement with an investor from another Member State that makes it possible to continue arbitration proceedings initiated on the basis of an arbitration clause whose content is identical to that agreement, where that clause is contained in an international agreement concluded between those two Member States and is invalid on the ground that it is contrary to those articles.
Publication date: 26-10-2021 | Case no.: C-109/20Key issues: arbitration agreement
1. [A]n arbitration award may be set aside only as a result of reasons indicated in Art. 1206 of the PCPC… .
2. [A] state court cannot examine the dispute between the parties to the arbitration proceedings on the merits within the proceedings to set aside an arbitration award.
3. An assessment as to whether an arbitration award violates the fundamental principles of the legal order shall be formulated narrowly and an affirmative conclusion may be reached only if the effects of the arbitration award would result in a material violation of the aforementioned principles… .
4. [C]ompliance or non-compliance of an arbitration award with the fundamental principles of the legal order is determined by the wording thereof, it is, however, not allowed to make such an assessment on the basis of facts and evidence unknown to the arbitral tribunal.
5. [T]here is a great deal of autonomy in arbitration, which is entirely consistent with the intentions of the lawmaker, distinctly limiting the review capabilities of a state court. The fundamental objective of this regulation is to expedite the procedure for resolving civil disputes, and not to create an additional phase of pre-judicial procedure. Parties deciding to submit a dispute to arbitration must take these conditions into account, which also include scant external review of arbitration awards.
6. The procedural public policy may be the basis for assessment of an arbitration award in two aspects. Firstly, the procedure which led to the delivery of the arbitration award is assessed for its compliance with the fundamental procedural principles of the legal order, secondly, the effects of the arbitration award are assessed from the perspective of their consistency with the procedural public policy, i.e. whether they are compatible with the procedural legal system, for example, whether they do not infringe res iudicata or the rights of third parties.
7. In the case law, the fundamental principles of the legal order include, among other things, the principle of civil liability for the injury caused…, the principle of the restitutive nature of liability for damages…, the pacta sunt servanda principle…, the principle of business freedom and freedom of contract, the principle of contractual fairness…, the principle of protection of property rights…, the principle of the autonomy of the will of the parties and of the equality of entities… .
Publication date: 24-09-2021 | Case no.: V AGa 408/20Key issues: arbitration procedure, petition to set aside arbitration award