Request for an amicable settlement and the running of the limitation period

On 30 June of this year an amendment to the provisions of the Civil Code came into force. The amending act covered, among other things, regulations concerning the effects of conciliation and mediation proceedings on the period of limitations for claims. These changes are a result of the hitherto existing controversies related to the dilemma of whether subsequent requests for a conciliation hearing or subsequent initiation of mediation interrupt the period of limitations.

Legal situation until 30 June 2022.

Previously, the period of limitations was interrupted, inter alia, by the commencement of mediation or by any action before a court taken directly to enforce a claim, which could be, in accordance with the established case law of the Supreme Court, a call for a conciliation hearing. This effect occurred in every case, regardless of whether or not a settlement was reached. This has led to a distortion of the institutions indicated, as in many cases creditors submitted requests for a conciliation hearing only in order to interrupt the running of the period of limitations rather than with a view to concluding a settlement, which contradicts the basic premise of the conciliation procedure. For this reason, a position has developed in the judicial practice of the courts, according to which a request for a conciliation hearing, whose sole purpose is to extend the period for the recovery of a claim, is not an action aimed directly at the recovery of the claim, and therefore this action does not interrupt the limitation period. However, in the absence of an explicit legal basis for dismissing a request for a conciliation hearing in the event that it is deemed not to aim at concluding a settlement but only at interrupting the limitation period, not all courts recognise the above position.

Legal situation after 30 June 2022:

The amendment dispels these doubts by introducing the principle that a call for a conciliation hearing and the commencement of mediation will not result in the interruption of the limitation period, but rather in its suspension for the duration of the amicable settlement or mediation proceedings respectively. This means that the running of the limitation period after the conclusion of the conciliation or mediation proceedings will continue and not start anew, as was the case until now.

The legislator justifies the introduced changes with the necessity to protect the debtor against a too long-lasting state of uncertainty as to the existence of an obligation to pay by eliminating the possibility of continuous interruption of the course of the period of limitation and to mobilise the creditor to promptly assert their rights.

The new provisions do not apply to conciliation and mediation proceedings initiated and not concluded before the date of enacting of the amendment, to which the hitherto binding provisions will apply.

Leszek Paterek, attorney-at-law