id: 20425

Warsaw Court of Appeal judgment

dated 9 March 2016

Case No. I ACa 796/15

Summary by arbitraz.laszczuk.pl:

An individual supplier, M.R., brought a claim before the Court of Arbitration at the Polish Chamber of Commerce against a retailer seeking a refund of over PLN 80,000 as unjust enrichment in the form of slotting fees allegedly imposed illegally by the retailer as a condition for stocking the claimant’s goods, constituting an act of unfair competition. The arbitral tribunal found that the fees were paid under a cooperation agreement for the service of promoting the claimant’s goods, for example through advertising circulars, were not illusory, and fell within the range of freedom of contract. The arbitral tribunal issued an award denying the claim.

The supplier applied to the regional court to set aside the award, alleging inter alia that the award violated public policy because the claimant was denied his constitutional right to a fair trial due to the arbitral tribunal’s refusal to apply Art. 15(1)(4) of the Unfair Competition Act, which prohibits slotting fees. The court found that the arbitral tribunal had given due consideration to the claimant’s allegations, although it ultimately ruled against him, and the allegations in support of the application to set aside the award essentially asked the court to review the merits of the claim, which was impermissible. The court denied the application to set aside the award accordingly.

On appeal, the Warsaw Court of Appeal found that the supplier was merely rehashing the arguments raised before the regional court. The court of appeal adopted the findings and reasoning of the lower court. It also pointed out that the constitutional right to a fair trial does not directly apply to an arbitral tribunal. On the merits, the court admitted that there were two competing views in the legal literature in Poland on whether payments for additional services of the type at issue here constituted prohibited slotting fees, but for the arbitral tribunal to adopt one of these competing views instead of the other could not constitute a violation of public policy justifying setting aside the arbitration award.

The court of appeal denied the appeal accordingly.

Excerpts from the text of the court’s ruling:

1. An arbitration court cannot be regarded as a body of the justice system to which Art. 45 of the Constitution applies directly.

2. Pursuant to Art. 1184 §2 of the Civil Procedure Code, the arbitration court is not bound by regulations on procedure before the state court, and thus in particular Art. 328 §2 of the Civil Procedure Code, setting forth the requirements for the justification of a judgment.

3. Even an erroneous interpretation of regulations of substantive law of fundamental importance for the resolution, made by the arbitral tribunal, does not necessarily mean violation of the public policy clause. The assessment of whether the ruling violates fundamental principles of the legal order should thus be conducted on a case-by-case basis, narrowly, and an affirmative conclusion may be reached only if the effects of the ruling of the arbitral tribunal would result in a material violation of the fundamental principles covered by the public policy clause.