In the judgment of April 29th 2021, in the case C-19/20, the CJEU found that:
1) a contractual term held to be unfair must be regarded, in principle, as never having existed, so that it cannot have any effect on the consume (point 43),
2) the contract shall continue to bind the parties upon those terms if it is capable of continuing in existence without the unfair terms’ (point 53),
3) Article 6(1) of Directive 93/13 must be interpreted as prohibiting the national court from modifying that contract by revising the content of that term on (point 67),
4 the situation of one of the parties to the contract cannot be regarded as the decisive criterion determining the fate of the contract – objective approach must be applied (point 56),
5) the consumer, being informed about the consequences of invalidity, may renounce the protection resulting from the directive and not claim his rights (point 46) and/or may conclude a renewal contract (points 48-49),
6) that it is for the national court to find that a term in a contract concluded between a seller or supplier and a consumer is unfair, even if it has been contractually amended by those parties. Such a finding leads to the restoration of the situation that the consumer would have been in in the absence of the term found to be unfair, except where the consumer, by means of amendment of the unfair term, has waived such restoration by free and informed consent, (point 61).
The judgment will have an impact on cases pending before the Supreme Court, initiated by the Financial Ombudsman including case no. III CZP 6/21 in which the hearing is scheduled for May 7th and on the motion of the First President of the Supreme Court (III CZP 11/21), scheduled for May 11th this year.
In the case of the Financial Ombudsman’s request, the Supreme Court would answer the question whether, in the event that the court declares the invalidity of a loan agreement denominated or indexed in a foreign currency or recognizes contractual provisions providing for the indexation of the loan to a foreign currency as illegal, if, after removing the prohibited provisions, the loan agreement does not may be further performed, the settlement would take place according to the provisions on undue benefit (art. 410 § 2 of the Civil Code in connection with art. 405 of the Civil Code). In the event of a positive answer to the above question, the Financial Ombudsman would like the Supreme Court to answer an additional question whether the undue benefits of the parties arise as a result of the failure of the legal basis (conditio causa finita) or the invalidity of the legal act obliging to provide the service (conditio sine causa).
In the case, from the request of the First President of the Supreme Court, after the above-mentioned judgment of the CJEU, transpired to be crucial the answers to questions no 5 i.e., in the event of the invalidity or ineffectiveness of a loan agreement due to the illegal nature of some of its provisions, does the limitation period for the bank’s claim for reimbursement of the amounts paid under the loan start from the moment of their payment? and 6 i.e., if, in the event of the invalidity or ineffectiveness of a credit agreement, either party has a claim for the reimbursement of the performance provided in the performance of such a contract, may that party also claim remuneration for the use of its funds by the other party?
More on the CJEU judgment – https://curia.europa.eu/juris/document/document.jsf?text=&docid=240550&pageIndex=0&doclang=pl&mode=req&dir=&occ=first&part=1&cid=12283844
More on the Financial Ombudsman’s application – http://www.sn.pl/sprawy/SitePages/zagadnienia_prawne.aspx?ItemSID=1489-301f4741-66aa-4980-b9fa-873e90506a11&ListName=Zagadnienia_prawne
More on legal questions of the First President of the Supreme Court – http://www.sn.pl/aktualnosci/SitePages/Wydarzenia.aspx?ItemSID=725-0dc69815-3ade-42fa-bbb8-549c3c6969c5&ListName=Wydarzenia
