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New jurisdiction of the courts in certain cases

While focusing on the most notable changes in the amended Civil Procedure Code, it is possible to overlook the change in the jurisdiction of the courts in several categories of cases. But this change is vital to many litigants.

The amendment of the Civil Procedure Code introduced hundreds of changes to the code itself but also to auxiliary acts, particularly the Act on Court Costs in Civil Cases. The scope of these changes is broad, as can easily be grasped by the addition to the code of the new Art. 351 and 372. These provisions modify the existing jurisdiction of the courts in cases involving allegations of infringement of personal interests and cases involving banking activity.

Claims for protection of personal interests

From 7 November 2019, an action seeking protection of personal interests (i.e. involving defamation, personality rights and the like) may also be initiated before the court for the place of residence of the plaintiff, not only the defendant. This is allowed by the new Art. 351 of the Civil Procedure Code: “An action for protection of personal interests infringed using mass media may be commenced before the court proper for the place of residence or registered office of the plaintiff.”

This provision seems narrow, as it requires an allegation of infringement of personal interests via mass media. But there is no reason that the internet cannot be regarded as a form of mass media, as there is no statutory definition of “mass media” (as pointed out for example by the director of the Poznań Tax Chamber in the individual tax interpretation of 3 June 2016, ref. ILPB1/4511-1-298/16-2/AMN). And the encyclopaedia definition of this concept is broad enough to cover “devices and institutions through which content is transmitted to a very numerous and diverse audience; press, radio, television, also film (cinema), books (popular), music recordings (disks, cassettes), and ‘new media’: VHS, DVD, film recordings (cassettes, DVD), teletext, satellite or cable television, computer games, internet (computer)” (Encyklopedia PWN).

With such a broad definition, the change may prove truly significant.

Statement of claim for banking activity

But the change introduced in Art. 372 of the Civil Procedure Code may prove even more significant (at least in light of the judgment by the Court of Justice on forex mortgage borrowers in Poland in Dziubak v Raiffeisen Bank International (C-260/18, 3 October 2019)). Under that provision:

§1. An action for a claim arising out of banking activity against a bank, other organisational unit authorised to perform banking activities, or their legal successors, may be initiated before the court proper to the place of residence or registered office of the plaintiff.

§2. §1 shall also apply to an action against a mortgage bank or its legal successor for a claim arising out of the activity of the mortgage bank.

Unlike “mass media,” “banking activities” are statutorily defined. Art. 5(1) of the Banking Law provides:

1. The following are banking activities:

1) acceptance of cash deposits payable upon demand or at the end of a designated period, as well as operating accounts for such deposits;

2) operating other bank accounts;

3) granting credit;

4) granting and confirming bank guarantees, and granting and confirming letters of credit;

5) issuing bank securities;

6) conducting bank money settlements; …

7) performing other activities reserved exclusively for banks under separate acts.

2. The following activities are also banking activities when performed by banks:

1) granting cash loans;

2) check and promissory note operations and operations involving warrants;

3) performance of payment services and issuance of electronic money;

4) term financial operations;

5) acquisition and sale of cash receivables;

6) storage of items and securities and offering of safe deposit boxes;

7) conducting the purchase and sale of foreign exchange values;

8) granting and confirming guarantees;

9) performance of commissioned activities related to the issuance of securities;

10) intermediation in making money transfers and settlements in foreign exchange trading;

11) intermediation in conclusion of structured deposit agreements;

12) advising with respect to structured deposits. …

4. Economic activity having as its subject activities referred to in par. 1 may be performed exclusively by banks, subject to par. 5.

5. Organisational units other than banks may perform activities referred to in par. 1 if authorised to do by separate acts.

It is apparent that the range of banking activities under the act is very broad, and practically covers the great majority of all actions which banks undertake in dealings with their customers (who are the persons primarily affected by this change in the Civil Procedure Code). Moreover, this provision consistently expands its scope of application beyond banks, taking in also other entities performing banking activities pursuant to Art. 5(5) of the Banking Law (such as cooperative savings and loan associations).

The effect of the changes?

The likely effect of these changes may be to increase the number of claims filed in both defamation and banking cases. After all, it is no secret that some potential litigants have ultimately decided not to file suit because they would have to do so before a court on the other side of the country, hiring counsel located hundreds of miles away.

The need to pursue certain cases before the most overburdened courts has also discouraged potential plaintiffs, when they learned that they would have to wait a year or longer for the first hearing in their case.

The current changes may eliminate these problems and parcel out a number of cases across various parts of Poland (considering that previously, the majority of cases involving banks, for example, were filed with the courts in Warsaw because that is where most of the banks are headquartered). The overall number of cases may increase, but they may be decided faster. A potential side effect could be unevenness in the decisions handed down by a broader range of courts (as many of these cases have in the past been limited to just a handful of courts).

For potential plaintiffs, this change represents more of an opportunity than a threat. But undoubtedly it increases the risks faced by banks and other financial institutions, which will be required more often than they have in the past to defend themselves before courts in various parts of Poland.

Dr Maciej Kiełbowski, adwokat, Administrative practice, Dispute Resolution & Arbitration practice, Wardyński & Partners