Charles Waddell, CMS Cameron McKenna
Introduction
Poland is a civil law rather than common law system. The phrase "common law" has two distinct meanings. In common law countries, it refers to the body of law that derives from custom and precedent as opposed to statute. It is also used to describe the Anglo-Saxon legal system generally, in order to differentiate it from the continental civil law model.
The main differences between the common law and civil law systems are summarised below
Statutes and the common law vs codification
In England and Wales, the law consists of a mixture of common law and legislation. Judges can create new law by the decisions they make and lower courts are bound by precedent to follow the judgments of higher courts. Legislation is generally passed by parliament in a piecemeal fashion to deal with specific issues as and when they arise. Acts of parliament are interpreted by the courts strictly, having regard to the meaning of the words used rather than to the underlying purpose or spirit of the legislation. However, recent years have seen a move away from this literal approach.
In civil law countries such as Poland, the law is to be found primarily in a series of codes. These are intended to be comprehensive and are normally written in broader and more conceptual language than common law statutes. The courts interpret the codes purposively, seeking to give effect to their underlying intention. Decisions of higher courts are not necessarily binding on lower courts, but they are persuasive, especially those of the supreme court. Academics play a greater role in civil law systems than they do in common law systems, and their views on the interpretation of codes can be as influential as the judgments of superior courts.
As laws are often written in conceptual language, interpretations of the law can be alarmingly inconsistent. This can be very frustrating for businessmen seeking clear advice on which to base a business decision. The problem has been exasperated by the EU accession process which has resulted in the Polish Parliament passing many new laws in order to make Polish law compliant with EU laws. The Parliament has often not found the time to give full scrutiny to these new laws and the poor quality of drafting has resulted in many unclear laws.
Red Tape
One of the features of the legal environment which businessmen from the United Kingdom can find frustrating is the number of times you have to prove who you are and who you represent. Poles, in common with people from most countries in continental Europe, are used to carrying ID cards with them at all times. The idea of ID cards is anathema to many citizens of the United Kingdom.
Persons representing companies from the United Kingdom will need to be able to provide evidence that they are legally entitled to represent their company. In Poland, such evidence is typically provided in the form of a power of attorney or an extract from the Commercial Register. An extract from the Commercial Register is a certificate issued by the Commercial Register (the registration court which deals with company registration in the same way as does Companies House in the UK) which states, inter alia, the name of a company, its registered number and certain prescribed details regarding the company such as the name of the directors and the persons who are entitled to represent the company. There is no equivalent certificate issued by Companies House in the UK. If you are representing a company from the UK, it is well worth bringing a power of attorney to that effect.
It is not uncommon for a Polish counterparty on a transaction to ask to see a power of attorney which has been notarised or legalised. An explanation of these terms is given below.
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A document has been notarised if it has been executed in the presence of a notary. A notary will want to see evidence of the person signing the document e.g. a passport.
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A document has been legalised or superlegalised if it has been taken to the Polish Consulate who fixes a stamp to the effect that the document he has been presented with is a legal and valid document and has been validly executed in the country of its execution.
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One of the peculiarities of most civil law jurisdictions is the prominent role played by notaries. Notaries are one of the three branches of the legal profession. They are licensed by the government. As well as being authorised to give legal advice, they are the only lawyers able to notarise documents. Notarised documents are required in certain circumstances, such as documents to buy and sell land or to buy and sell shares in a limited liability company. Fees of notaries are fixed by the Ministry of Justice although for particularly large transactions it is sometimes possible to negotiate lower fees.
The Polish legal system
Summary
Essentially, the legal system consists of three levels of common law courts - district, circuit/regional and appellate, and the national Supreme Court, which hears appeals from the second instance courts and provides rulings on fundamental issues such as the interpretation of the national civil code.
In certain parts of the country, there are also specialised courts handling commercial law, labour and social insurance law, and family law disputes.
Hearings must generally be conducted in public, although a court can sit in closed session for exceptional cases involving, for instance, state or trade secrets. There are detailed rules covering pleadings, evidence, judgements, appeals, enforcement and costs.
Judges are appointed by the president of the Republic on the recommendation of the National Chamber of Judicature.
Besides judges and state criminal prosecutors, there are three other types of general lawyer in Poland: advocates (adwokat), legal advisors (radca prawny) (who are the nearest equivalent to English commercial solicitors) and notaries public (notariusz).
One of the main problems with the Polish legal system lies with the lacklustre enforcement procedures available through the courts. The amount of time it can take for a case to proceed through the courts and for judgment to be entered against a party depend on the city, however, two to three years is quite a common time frame for a final judgement to be issued. There is a huge backlog in cases in the courts, which adds to this delay. Once judgement is given, it can take some time for a party to enforce the judgement. Accordingly, we recommend that companies use arbitration to resolve disputes. This is a much quicker and easier process to use.
Several organisations in Poland offer private arbitration and conciliation services to domestic and foreign parties. But conciliation and alternative dispute resolution services are rarely used. So far, Polish parties have even been slow to use arbitration for their domestic trade disputes.
Surprisingly perhaps, arbitration in Poland is still governed by the communist Code of Civil Procedure 1964. Key points are listed below. However, the code is not by any means unworkable and many of its provisions are similar to those of the UNCITRAL Model Law on International Commercial Arbitration.
There are approximately twenty private permanent arbitration tribunals operating in Poland. The best known is the Court of Arbitration at the Polish Chamber of Commerce in Warsaw. The Court of Arbitration at the Polish Chamber of Commerce offers conciliation services as well as institutional arbitrations. The court maintains a list of foreign and Polish arbitrators suitable for appointment, although the parties can nominate other individuals who meet the statutory qualifying requirements, save that a sole arbitrator and a presiding arbitrator shall be appointed and nominated from the list of arbitrators maintained by the Court.
The above is for guidance only. Please contact Paweł Pietkiewicz at CMS Cameron McKenna (tel: +48 22 520 5555, or e-mail:
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) for specific advice and assistance. To review an archive of information and to register for CMS Cameron McKenna's email update service on topical legal issues in Poland, please click on: www.law-now.com/law-now/bpcc
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