In accordance with the Polish legal system, we are able to apply solutions allowing to change contractual relations in the face of exceptional circumstances.
We would like to present the solutions known to the Polish law, which might be applicable to companies’ contractual relations during the pandemic.
Force majeure
According to the case-law, force majeure is considered to be an external event which cannot be foreseen and prevented. Certainly, a global pandemic caused by SARS-CoV-2 is the hallmark of such an event.
What can you do when force majeure occurs?
- The definition of force majeure usually occurs in the form of a provision in the contract between contracting parties. With this in mind, when the circumstances defining the impact of force majeure come true, reference should be made directly to the clause included.
- In order to benefit from the rights related to the fulfilment of exceptional circumstances, it is necessary to prove the situation properly. Evidence in the form of documents, photographs, recordings etc. have to be carefully collected.
- The company will have to prove that it has made every effort to protect itself from the effects of force majeure, and to limit the damage that has occurred, simultaneously indicating how the preventive actions were taken.
- In order to exercise our rights, negotiations with the contractor are crucial. Proper preparation of evidence will ensure a good start in talks.
Force majeure has been regulated similarly in most jurisdictions. In the face of the current global situation, it is a great facilitation for the implementation of contractual relations with foreign entities.
Rebus sic stantibus clause
If due to coronavirus pandemic, the performance of a service would be associated with excessive difficulties or would threaten one of the parties with a gross loss, the further fate of the performance of its provisions may be decided by the court.
- In order to apply this clause, we are forced to initiate a litigation. However, it is not uncommon for such a path to be the last possible solution due to the lack of consensus between the parties to the contract.
- As in the case of force majeure, we suggest collecting evidences to properly illustrate the facts.
- The court may determine the manner in which the obligation is to be performed, or even decide to terminate the contract. In this connection, it should be remembered that it is no longer the contractors who will shape the contractual relationship between them, but the court in its assessment.
Specific provisions
It should be remembered that in the face of the current situation, governments are coming up with newer and newer proposals to regulate various sectors of the economy in the face of the prevailing pandemic.
Kolecka Law Firm is monitoring the ongoing changes – we invite you to observe our and LinkedIn and Facebook to stay up to date!
Author: Oliwia Kruczyńska, Junior Associate at Kołecka & Partners LLP
