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Case for payment on promissory note discontinued

In order to familiarize blog readers with our activities, we would like to report on some of our many interesting cases, including commercial litigation before the court.

In one such case, our law firm was approached by a client with a payment order, in which the District Court ordered the defendant to pay to the plaintiff - one of the major companies in the construction industry - the amount of PLN 109,593.52 plus statutory interest and legal costs. The above payment order was issued on the basis of a filled blank promissory note.

At the time the Client came to our law firm, enforcement based on the above-mentioned payment order with an enforcement clause (enforcement title) had already been in progress for several years, and the debt enforced by the bailiff from the Client (including interest and enforcement costs) at that time amounted to PLN 179,255.06.

After a thorough analysis of the court and bailiff files, it turned out that there were grounds for rescinding the payment order due to the lack of effective delivery (both during the court and bailiff proceedings). The mail with the payment order itself was never actually received by the defendant. In turn, the acknowledgment of receipt of the payment order bore the signature of a person who was not, on that date, an "adult household member" within the meaning of Article 138 § 1 of the Code of Civil Procedure (which provides for so-called substitutive delivery, based on the presumption of delivery to the addressee in the event of delivery to, among others, an adult household member. This presumption may be rebutted in evidence proceedings). In addition, there was an error in the name of the defendant in both the payment order and the payment order mail.

We filed a motion to serve the payment order, or to restore the deadline for filing objections to the payment order, as well as a motion to rescind the order to make the payment order final. At the same time, we filed charges against the payment order.

In the allegations, we claimed, among other things:

- non-existence or invalidity of the promissory note surety (the guarantor did not make a surety on the blank promissory note, nor was he a party to the promissory note agreement)

Thus, according to the views of the case law, the relationship of promissory note surety does not arise as a result of a unilateral legal act of the surety, but is based on an agreement concluded between the surety and the creditor (so also the Supreme Court in its resolution of September 20, 1994, III CZP 113/94, Wokanda 1994/12/2 and also in the judgment of February 23, 2006, II CSK 129/05, unpublished).

- allegation of a formal defect in the promissory note

Here we had in mind the views of case law, according to which a guarantor may be liable on his own, as long as his obligation has the "basis" required by the law on bills of exchange in the form of a formally defective declaration (signature) of the avalanche (cf. the Court of Appeals in Katowice Civil Division I of 1.04.2015, ref. I ACa 1027/14).

- The allegation that the promissory note was filled contrary to the wording of the promissory note agreement (before the expiration of the payment deadlines under the business agreement and without granting additional time for payment in accordance with the agreement), with the result that the promissory note obligation did not arise

- Allegation of failure to make an effective call to redeem the promissory note (due to an error in the name in the call to redeem the note).

After several months of evidence as to whether the payment order was actually served, by order of July 2018. The District Court ordered that the payment order be served along with the defendant's statement of claim, stayed the execution of the payment order, and revoked the court's order on making the above payment order enforceable.

So, 6 years after the order for payment was issued, and despite the pending execution, the case came up again at first instance.

Subsequently, also in view of the claims that had arisen on the part of the client, the parties reached a settlement out of court, whereby the plaintiff withdrew the lawsuit in its entirety with a waiver of the claim in its entirety.

This resulted in the discontinuation of legal proceedings for payment against the defendant. As a result, the Client's debt, amounting to approximately PLN 180,000 and enforced by the bailiff, was reduced to.... PLN 0, while the enforcement itself was discontinued.

Legal representation was provided by attorney Julia Armata in the above case.

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