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contains rulings by the Supreme Court of Poland, other Polish state courts and the Court of Justice of the European Union concerning arbitration. The unique collection of Supreme Court rulings from the pre-war era are particularly notable. The editors of the portal have selected excerpts from the holdings as headnotes, together with a breakdown of the key issues in each case. Readers can search the entire case law database using selected parameters.
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Polish Supreme Court order dated 24 June 2021 Case No. IV CSK 229/21

1. [B]y entering into an arbitration agreement, the parties consciously waived submission to the strictures of proceedings before a state court.

2. Therefore, it is not unreasonable to state that by concluding an arbitration agreement, the parties limit their constitutional and conventional right to court.

3. 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, and one of the parties is not heard and does not have the opportunity to address the evidence and 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 that party being deprived of the right to a defense. This happens only when a party has no opportunity to present and argue for its position… .

4. [A] petition to set aside an arbitration award is not an appellate instrument, but a type of extraordinary judicial review by a state court over the activity of an arbitral tribunal. Thus in proceedings to set aside an arbitration award a state court cannot consider a dispute between the parties to the arbitration proceedings on the merits… .

Publication date: 24-06-2021 | Case no.: IV CSK 229/21

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

id: 20604

Polish Supreme Court judgment dated 17 June 2021 Case No. V CSKP 30/21

1. Provisions regarding grounds of a petition to set aside an arbitration award (Art. 1206 § 1 and 2 of the PCPC) in proceedings initiated thereby constitute a basis for a substantive ruling on the merits of the case, which justifies treating them, in the context of the grounds for a cassation appeal, as a functional equivalent to substantive law provisions… .

2. [A]rbitrability of a dispute, which is one of the prerequisites of the effectiveness of an arbitration award, is subject to assessment by the court considering the petition to set aside an arbitration award, regardless of whether the petitioner has raised particular allegations in the arbitration proceedings or not, or has invoked particular allegations in the petition or not … .

3. Compliance with the requirements regarding the composition of an arbitral tribunal, including the correct appointment of arbitrators, may be … subject to assessment in the proceedings to set aside an arbitration award irrespective of whether an arbitral tribunal has decided on this matter previously.

4. Art. 1206 § 1 point 4 of the PCPC shall apply with regard to irregularities in the composition of an arbitral tribunal at all stages of the proceedings, including the stage of appointment of the arbitrators by the parties or a third party. This applies also to incorrect representation of these persons by appointment of the arbitrators.

5. Failure to comply with the requirements on composition of an arbitral tribunal constitutes a basis for setting aside an arbitration award regardless of its effect on the outcome of the case … .

6. Proceedings to set aside an arbitration award are proceedings separate from the prior arbitration proceedings and its aim is not to consider the dispute resolved by the arbitral tribunal on merits.

7. [S]pecific rules of representation of the defendant company in the proceedings regarding revocation or a declaration of invalidity of a shareholders’ resolution (art. 253 of the Commercial Companies Code) apply also in proceedings to set aside an arbitration award delivered in a dispute whose object is a claim for revocation or declaration of invalidity of a shareholders’ resolution.

8. The entity structure of the proceedings initiated by the petition to set aside the arbitration award, including the ability of the management board in corpore having special judicial capacity to act as a party is the same as in the prior arbitration proceedings, in which the arbitral tribunal ruled on potential defectiveness of a resolution, although procedural roles of the entities participating in the proceedings may change. A judgement delivered in the proceedings to set aside an arbitration award is decisive for the fact whether consideration on the merits of a resolution’s effectiveness remains in force, and indirectly, whether such consideration may acquire the same permanent legal force as a judgment of a state court (Art. 1212 § 1 of the PCPC). Therefore, the same risks regarding a conflict of interests on the side of the representatives of a company, which justify application of specific rules of representation in proceedings concerning revocation or declaration of invalidity of a shareholders’ resolution, are present in proceedings to set aside the award. In conjunction with a protective function of Art. 253 § 2 of the Commercial Companies Code, the aforementioned arguments are in favor of extending those specific rules to the proceedings to set aside an arbitration award, in which the arbitral tribunal ruled on a claim for declaration of invalidity or revocation of the shareholders’ resolution, regardless of the fact whether in such proceedings a company whose shareholders have adopted the resolution is the petitioner or the other party in the dispute.

9. The grounds of a petition to set aside an arbitration award are not of a disjunctive character; they may also be in a causal relation with respect to each other… .

10. One of the fundamental principles of arbitration is the principle of equal treatment of the parties (Art. 1183 of the PCPC). The principle is of a fundamental and axiological character in arbitration… . The principle concerns not only the equal treatment of the parties in the arbitration proceedings in the context of the right to be heard and the procedural means available to the parties, but also at the stage of formation of the arbitral tribunal. A violation thereof results, i.a. from the lack of the necessary equilibrium between the parties by appointment of the arbitrators, which may result not only from the wording of the arbitration agreement (Art. 1161 § 2 of the PCPC), but also from factual circumstances in which the appointment of arbitrators takes place.

Publication date: 17-06-2021 | Case no.: V CSKP 30/21

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

id: 20589

Polish Supreme Court judgment dated 23 April 2021 Case No. III CSKP 78/21

1. [P]assing an order concerning recognition or enforcement of an arbitration award does not preclude any subsequent setting aside of the award …. .

2. In proceedings regarding recognition and enforcement of a domestic arbitration award, a state court examines only the existence of the prerequisites indicated in Art. 1214 § 3 of the PCPC – they do not include the invalidity or ineffectiveness or expiration of an arbitration agreement – which corresponds only to a part of the grounds examined in a case regarding a petition to set aside an arbitration award, that is the grounds examined by a court ex officio under Art. 1206 § 2 of the PCPC. Therefore, there is a need to agree with the view that, with reference to domestic arbitration awards, proceedings regarding a petition to set aside an arbitration award primarily have a control function.

Publication date: 23-04-2021 | Case no.: III CSKP 78/21

Key issues: petition to set aside arbitration award, recognition and enforcement of domestic arbitration award

id: 20587

Polish Supreme Court order dated 10 March 2021 Case No. V CSKP 64/21

[T]he mere inclusion of an arbitration agreement in another country in a contract does not result in the invalidity of the arbitration agreement. Nevertheless, it is impossible to leave out the circumstances which led to the inclusion of the arbitration agreement in the contract, as well as it is impossible to leave out the wording of the contract, if the contract may affect the determination and assessment whether an activity of the contractor benefiting from the presumption indicated in Art. 17 (1) of the Act on National Court Register was characterized by good or bad faith.

Publication date: 10-03-2021 | Case no.: V CSKP 64/21

Key issues: arbitration agreement

id: 20591

Polish Supreme Court order dated 9 October 2020 Case No. II CSK 37/20

1. [I]n proceedings initiated by a petition to set aside an arbitration award (…) a state court does not examine the accuracy of the assessment of evidence taken by an arbitral tribunal, the correctness of factual findings, the accuracy of interpretation or application of rules of the substantive law; a state court does not assess the accuracy of a specific method of resolving a litigious legal relationship by an arbitral tribunal (…).

2. The essence of a petition to set aside an arbitration award is to create a control mechanism which respects, on the one hand, the distinctiveness and autonomy of arbitration, on the other hand, prevents functioning of arbitration awards which are in breach of the rule of law in the legal order. 

3. The proceedings initiated by a petition to set aside an arbitration award do not lead to a substantive re-examination of the dispute between the parties, (…) but the aim of these proceedings is only to verify the claims of the petitioner concerning the statutory grounds for setting aside an arbitration award cited in the petition.

Publication date: 09-10-2020 | Case no.: II CSK 37/20

Key issues: petition to set aside arbitration award

id: 20580

Gdańsk Court of Appeal judgment dated 16 September 2020 Case No. V ACa 162/20

1. A petition to set aside an arbitration award is a legal remedy combining features of an extraordinary remedy at law, especially a petition for the revival of the proceedings, and an action for the formation of law or a legal relationship in which the claimant (petitioner) demands a state court to render a judgement on setting aside an existing legal relationship established by an arbitration award. A state court’s judgment granting the petition is of quashing nature, as in such a situation the state court can only set aside the arbitration award, and only insofar as demanded by the petitioner (…).

2. A petition to set aside an arbitration award is not intended to be a remedy leading to consideration, by a state court, of the merits of the dispute resolved by an arbitral tribunal. In fact, there is considerable autonomy in arbitration procedure (…) limiting the possibilities of review by the state court. If parties decide to submit a dispute to arbitration, they need to take these circumstances into account, including also little external control of arbitration awards. This does not mean, however, that if a dispute is submitted to arbitration, the parties have to agree to all kinds of procedural and substantive shortcomings of the arbitral tribunal (…).

3. Considering a petition, a state court examines a case only on the grounds set out in the Polish Civil Procedure Code. Art. 1206 of the PCPC exhaustively lists  the grounds on which a petition to set aside an arbitration award may be based. The difference between the grounds of a petition indicated in Art. 1206 § 1 and § 2 of the PCPC is that the grounds set out in § 1 are taken into account by a state court only at the request of a party, the grounds set out in § 2 are taken into account ex officio (…).

4. [I]t is deemed that the case in which an arbitral tribunal rules ultra petita or aliu should not escape the control of the state court. This assumption shall be considered well-founded also in the light of the Polish Civil Procedure Code, with the proviso that the character of arbitration may justify an approach to the assessment of the limits of the claim being more flexible than in the case of state courts.

5. [A]lthough Art. 1188 § 1 of the PCPC does not indicate obligatory elements of a statement of claim in arbitration proceedings, including the exact wording of the claim (cf. Art. 187 § 1 point 1 of the PCPC), nonetheless the necessity to concretize the claim as an element determining the subject matter of the arbitration proceedings may be derived indirectly from Art. 1202 first sentence of the PCPC; it may also result from the rules agreed by the parties or set out in the arbitration rules (…).

6. The principle of equal rights of the parties is a fundamental principle of arbitration proceedings indicated directly in Art. 1183 first sentence of the PCPC.

7. Procedural public policy may be a basis for assessment of an arbitration award in two aspects. First, subject to the assessment is the compliance of the procedure which led to issue of the arbitration award with the fundamental procedural principles of legal order. Second, subject to the assessment are the effects of the award from the point of view of their compliance with the procedural legal order, i.e. whether they are compatible with the procedural legal system, for example, whether they do not infringe res iudicata, the rights of third parties.

8. An arbitration award may be said to be contrary to the fundamental principles of the legal order only with respect to constitutional principles of the socio-economic system or the fundamental principles governing specific fields of substantive law (…).

9. [P]ublic policy within the meaning of Art. 1206 § 2 point 2 of the PCPC includes not only the principle of freedom of contract and the pacta sunt servanda principle, but also principles limiting the freedom of contract and stability of contracts.

10. [A]pplication by an arbitral tribunal of applicable substantive law for resolution of a dispute, which it is generally required to do under Art. 1194 § 1 of the PCPC, is thus subject to review by a state court considering a petition to set aside an arbitration award only insofar as application of such law is required by the public policy clause, which is considered by the court ex officio.

Publication date: 16-09-2020 | Case no.: V ACa 162/20

Key issues: petition to set aside arbitration award

id: 20583

Polish Supreme Court order dated 15 September 2020 Case No. I CSK 182/20

1. Generally, a state court cannot examine whether an award challenged in a petition to set aside was based on properly established facts and how and whether an arbitral tribunal correctly interpreted the norms of substantive law it applied (…).

2. By examination of the grounds and prerequisites set out in Art. 1206 § 1 point 4 of the Polish Civil Procedure Code, what is important is the presence of a failure to meet the requirements in the scope of fundamental principles of arbitration proceedings resulting from a statute or specified by the parties. One of these principles is to base the award on established facts, which takes place after hearing of evidence. (…). Thus, only if the state court found that such hearing of evidence has not been conducted at all, or has been incomplete or obviously faulty, in breach of the principles of logical reasoning, of linking facts together in a cause-and-effect chain, selective admission of evidence in the case, examination of evidence of only one party in groundless omission of the evidence requested by the other party, etc., it would be possible to find that the requirements set out in Art. 1206 § 1 point 4 of the PCPC. (…).

3. [A]n obvious discrepancy between an arbitration award and the facts of the case may demonstrate a violation of the rule of law (…). This means that not every declaration that an award is inconsistent with the factual state may result in setting aside of this award. It is assumed that a conclusion that the rule of law has been violated is justified, if as a result of the arbitration award the fundamental principles of the legal order of the state are infringed (…).

Publication date: 15-09-2020 | Case no.: I CSK 182/20

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

id: 20579

Polish Supreme Court order dated 17 July 2020 Case No. V CSK 109/20

1. Going beyond the limits of the claim may … constitutes a violation of the fundamental principles of procedure before an arbitral tribunal (Art. 1206 § 1 point 4), alternatively, depending on the circumstances of a case, it may result in the defendant being deprived of the ability to defend its rights (Art. 1206 § 1 point 2 of the PCPC). There is also no doubt that a claim to set aside an arbitration award may relate to the entire award or to a part thereof only, and a state court is bound by the scope of the challenge indicated by the party, which does not mean that a state court cannot find a claim to be well-founded in part … .

2. On the other hand, the general view expressed by the adjudicating panel [in the Polish Supreme Court judgment dated 6 May 2016, Case No. I CSK 305/15 – insertion added] that a court is bound by the claim presented in the petition to set aside an arbitration award in full, and the court’s finding that the granting of a claim in part pertains to a claim of another kind that has not been raised by the petitioner, is isolated and has not been followed up in subsequent case-law, also after an amendment of the petition model procedure.

3. The proceedings to set aside an arbitration award are one-instance proceedings and a judgment may only quash or dismiss the petition, which, taking into account the principle of the state court being bound by the scope of the challenge, makes the application of Art. 384 of the PCPC in such proceedings, as a general rule, aimless.

Publication date: 17-07-2020 | Case no.: V CSK 109/20

Key issues: petition to set aside arbitration award

id: 20585

Judgment of the Court of Justice of 2 April 2020, C-480/18, PrivatBank

[I]n accordance with the principle of the procedural autonomy of the Member States, the national legislature may give the competent authority, in the complaints and penalty procedures referred to in Articles 80 to 82 of Directive 2007/64, as amended by Directive 2009/111, the power to take into account the existence and contents of an arbitration ruling settling a dispute between a user and provider of payment services concerned by those procedures, provided that the probative value given to that ruling in those procedures is not liable to undermine the purpose or specific objectives of the procedures, the rights of defence of the persons concerned or the independent exercise of the powers and competencies conferred on that authority, which is a matter for the referring court to ascertain.

Publication date: 02-04-2020 | Case no.: C-480/18

Key issues: arbitration award

id: 20563

Warsaw Court of Appeal judgment dated 18 November 2019 Case No. VII AGa 804/19

1. [I]n the proceedings commenced as a result of a petition to set aside an arbitration award, a state court does not examine the arbitral tribunal’s assessment off the accuracy of evidence, the correctness of factual findings or interpretation and application of substantive law. The legitimacy of particular means by way of which an arbitral tribunal has resolved the disputed legal relationship is not subject to a state court’s assessment either. The essence of a petition to set aside an arbitration award is to create a control mechanism respecting, on the one hand, the separateness and autonomy of arbitration, and on the other hand, preventing non-state court rulings infringing the rule of law from functioning in the legal circulation. Proceedings concerning a petition to set aside an arbitration award do not result in reconsideration of the merits of the dispute between the parties, but are intended only to verify the petitioner’s allegations as to the existence of the grounds raised in the petition, as provided for in Art. 1206 § 1 of the PCPC. The aim of the petition is to prevent only an arbitration award which fails to comply with the elementary formal requirements of dispute resolution from remaining in the legal circulation.

2. The grounds resulting from Art. 1206 § 2 point 2 of the PCPC are legitimate, if the effect of an arbitration award is contrary to the fundamental principles of the legal order of the Republic of Poland. (…) The fundamental principles of the legal order which are the basis for assessment of an arbitration award shall be understood not only as constitutional rules, but also as ground rules in particular areas of law, and examination of a case with respect to the ground for setting aside of an award under Art. 1206 § 2 point 2 PCPC shall not go beyond a qualified infringement of law. The public policy clause covers both the procedural and substantive fundamental principles of the legal order. Procedural public policy may be a ground for assessing an arbitration award in two aspects. First, the procedure which led to issuance of an arbitration award is assessed for its compliance with the fundamental procedural principles of the legal order. Second, the effects of the arbitration award are assessed from the perspective of their consistency with the procedural public policy, i.e. whether they are reconcilable with the system of procedural law. Then, an infringement by an arbitral tribunal of the substantive law applicable to the resolution of the legal relationship from which the dispute referred to arbitration arose, legitimates setting aside of the award, only if it is connected with an infringement of the fundamental principles of the legal order. Simultaneously, in the event of a lack of compliance of an award with the fundamental principles of the legal order, the question is not whether the award is compliant with all absolutely binding provisions of law, but whether the award has had an effect which is irreconcilable with the fundamental principles of the state legal order (…). Indeed, the application of the public policy clause does not serve to remove all irregularities and defects of arbitration awards, but is intended to protect the integrity of the public policy.

3. The right to a fair trial is a pillar of a democratic state of law and for this reason its infringement justifies the conclusion that the rule of law has been infringed. (…) such a situation will occur especially in the event of non-consideration of a set-off allegation raised by a party. The principle of the fair trial dictates consideration of a set-off allegation properly raised by the respondent.

4. [T]he Arbitral Tribunal erroneously refused to hear the set-off allegation, because the mere fact of the respondent’s liability not being covered by the arbitration agreement is not an obstacle to consider such an allegation.

Publication date: 18-11-2019 | Case no.: VII AGa 804/19

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

id: 20545

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