Supreme Court judgment
dated 11 August 2005
Case No. V CK 86/05
Summary by arbitraz.laszczuk.pl:
In a dispute concerning the quality of performance of work, Z. sp. z o.o. (the assignee of the claim) obtained an arbitration award against Andrzej B., as a partner in a registered partnership providing technical design services. The regional court set aside the award, finding that the award violated public policy in the form of requirements for assignment of claims (Civil Code Art. 509 §1) and the requirement that if one of the parties to a contract is to have a contractual right to renounce the contract, a specific deadline must be stated (Civil Code Art. 395 §1).
The appellate court denied the appeal by Z. sp. z o.o., holding that the procedure in commercial cases (such as rules for preclusion of claims and evidence) does not apply in a proceeding to set aside an arbitration award, and that under the arbitration law the court may set aside an award as violating public policy even if the party did not assert or justify such claim in its pleadings. The Supreme Court denied the cassation appeal.
Excerpts from the text of the court’s ruling:
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.