Supreme Court upholds law firm’s cassation appeal
26.01.2017
In the judgment issued 25 January 2017 in Case IV CSK 205/16, the Supreme Court of Poland set aside the judgment of the Gdańsk Court of Appeal, holding that the ruling below was grossly unjust, and remanded the case for reconsideration.
The case was the second to arise out of a real estate sale that did not go through. In the first case, it was held by the Gdańsk Court of Appeal with legal finality that the seller had a right to retain the advance paid by the buyer in the amount of PLN 14 million. It was held then that the seller had effectively renounced the contract, which in this case provided for payment to the seller of a contractual penalty in that amount.
The present case involved instead the down payment made by the buyer in the amount of PLN 30 million. The trial court and the appellate court held, as in the first case, that the seller had effectively renounced the contract, and that it was entitled to keep the down payment. But the Supreme Court did not share this legal assessment. It held that although the issue of the justification for the contractual penalty in the amount of PLN 14 million could not be re-examined, nonetheless in the present case the Supreme Court was not bound by the finding in the previous case that the seller had effectively renounced the contract. According to the oral justification for the judgment delivered from the bench, it was the buyer who was entitled to renounce the contract, because claims to the property had been asserted by a former owner—and on top of that the claims were concealed from the buyer.
However, in its oral justification the Supreme Court did not address the allegation in the cassation appeal addressing the permissibility under Polish law of combining a claim for a contractual penalty with retention of the down payment, for the same breach of contract.
The cassation appeal was prepared by Marcin Lemkowski and Maciej Kiełbowski, adwokaci at Wardyński & Partners.