Under Art. 417 of the Civil Code, the State Treasury is liable for injury caused in exercise of public authority. It’s usually not too hard to determine whether the state is acting as a party to civil dealings and when it is exercising authoritative competencies. Nonetheless, there are some activities of public entities that are not clearly authoritative but should be deemed to be the exercise of public authority, the Supreme Court of Poland held in its judgment of 6 June 2014 (Case III CSK 211/13).
Accident on an icy road
The plaintiff sought damages from the county in connection with an accident on a county road. She slipped and fell when getting off a bus on an icy road and suffered a serious injury to her leg. The county had assigned the task of winter maintenance of the road to the local commune under the relevant regulations, and the commune in turn had hired a private consortium to maintain the road. At the first instance, the regional court denied the claim, holding that the county had released itself from liability under Art. 429 of the Civil Code by assigning the actions to another territorial governmental unit (the commune), and the commune had then entrusted the duty to an outside professional entity. The court of appeal shared the view of the regional court. Pursuant to a cassation appeal, the Supreme Court had to decide two questions:
- Is the winter maintenance of a road, falling within the group of “other public tasks,” the exercise of public authority?
- Can a territorial governmental unit release itself from liability for performance of a public task under Civil Code Art. 429 by entrusting the activity to a professional entity?
Exercise of public authority
As the Supreme Court indicated in its justification, all lawful forms of action by the state should fall within the scope of the State Treasury’s liability in damages under Civil Code Art. 417. This should be understood to mean not only behaviour regarded as authoritative because of the possibility of applying compulsion, but also those spheres in which certain duties rest on the state, for example performance of public tasks. Even though their performance is not authoritative in nature, in the court’s view it should be treated as the exercise of public authority.
Improper performance of public tasks, causing injury to the individual, places the individual in an unequal position and thus that person should have the ability to pursue a claim for damages under Art. 417 and following of the Civil Code. Proper performance of public tasks is required of the territorial governmental unit in this instance and thus results in its liability in damages.
As activities of the state that are the exercise of public authority, the court indicated such examples as organising healthcare and education, and removal and treatment of communal waste.
Entrusting tasks to a professional entity
In the Supreme Court’s opinion, it follows directly from Civil Code Art. 417 §2 that the State Treasury cannot release itself from liability by assigning the exercise of public authority to another public or private entity. To hold otherwise would defeat the purpose of the State Treasury’s liability in damages.
Because performance of public tasks is the exercise of public authority, there is no doubt that a state or local governmental entity cannot release itself from liability for performance of such tasks by entrusting their performance to an entity from the private sector.
This ruling by the Supreme Court is significant from the practical point of view and advantageous to individual litigants. The state is active not only in carrying out authoritative administrative tasks, but also in performing public tasks immediately affecting citizens in their daily life. It may happen that injury resulting for example from improper snow removal cannot be compensated by a private entity. In that case the State Treasury may be sued and held liable.
Aleksandra Burda, Real Estate, Reprivatisation, and Private Client practices, Wardyński & Partners