Force Majeure – the importance of precisely defining contractual provisions

by

Warning! AUTOMATIC TRANSLATION FROM POLISH LANGUAGE

ATTENTION – THIS IS AN AUTOMATIC TRANSLATION FROM POLISH

In a final judgment of the District Court in Olsztyn in a commercial case involving our client, the court dismissed the State Treasury’s appeal seeking contractual penalties for uncollected raw materials that were the subject of a sales agreement with the client.

The client’s defense against this claim was based on the fact that a force majeure event occurred at the client’s company, and therefore a contractual penalty could not be charged. The sales agreement specified the vis maior provisions to the effect that the obligation to pay a contractual penalty does not arise in the event of a force majeure event if it prevented the performance of the contract with due diligence.

The client maintained due diligence; despite the limitation of the company’s operations due to the destruction of part of the infrastructure, the client continued to operate the business on a limited scale and proposed to postpone the goods collection date by several months. The plaintiff, representing the State Treasury, was not interested in such a proposal and sent a reminder for payment of a contractual penalty, also denying the nature of the event at the Client’s enterprise, claiming it did not constitute a force majeure event.

The standard contract form constituting the legal basis for the claim did not sufficiently precisely define the possibility of invoking the vis maior clause, and the precise definition of rights and obligations in contractual provisions rests with the party who drafted the contract. In this regard, the Supreme Court has already expressed an important view in one of its rulings: The view should be shared that, also under Polish law, and not only in consumer relations (Article 385 § 2 of the Civil Code), doubts should be interpreted to the detriment of the party who drafted the contract. The risk of doubts arising from unclear contractual provisions that cannot be resolved through interpretation should be borne by the party who drafted the contract. (See: written justification of the Supreme Court judgment, reference number III CSK 55/11, published in SAOS, and the Supreme Court rulings cited therein). The Olsztyn court considered the client’s case for the third time on the same factual basis, brought by the State Treasury. In the two previous cases, the State Treasury’s claims for contractual penalties stipulated in the applicable standard forms were also dismissed with finality. Attorney Michał Mróz successfully handled all of the client’s proceedings from the outset.