Help for francophiles - the most common questions

Our assistance includes:

  • Analysis of the loan agreement to check for the existence of abusive clauses in it (which are not allowed)
  • Drafting of pleadings in franking cases - a lawsuit, a reply to a lawsuit, a motion for injunctive relief, an appeal or reply to an appeal, a complaint, and others
  • Representation before the court in the form of participation in court hearings and other meetings
  • The possibility of meetings at our law firm to discuss the progress of the case

Questions and answers

What are examples of so-called "valorization" clauses in loan agreements?

  • "The loan is indexed to CHF/USD/EUR, after conversion of the amount disbursed in accordance with the CHF/USD/EUR buying rate according to the Foreign Currency Exchange Rate Table of the Bank%r@."
    Bank Millennium SA in Warsawe
  • "The principal and interest installments and the interest installments shall be repaid in zlotys after they have been converted according to the CHF selling rate from the exchange rate table of BRE Bank S.A. in effect on the repayment date at 2:50% p.m."
    BRE BANK SA in Warsaw
  • "The amount of the loan denominated (valorized) in CHF or tranches of the loan will be determined according to the foreign exchange purchase rate for the aforementioned currency in accordance with the exchange rate table in effect at the bank on the date of use of the loan or tranche of the loan%r@."
    Kredyt Bank SA (successor to Santander SA).
  • "The loan is used in zlotys, while converting the loan amount according to the foreign exchange purchase rate for CHF in accordance with the "Table of rates" in effect at the Bank on the date of use of the loan%r@."
    Kredyt Bank SA (successor to Santander SA).

What is an example of a denominated loan clause?

  • "The Bank grants the borrower a loan in the amount of CHF (...) for a period of (...) months. The loan will be disbursed within three business days in the amount of (...) PLN, which is the amount of (...) CHF converted at the exchange rate as of (...) The amount of the loan granted (...) CHF. The loan shall be disbursed in the Polish currency to finance obligations in the Republic of Poland%r@."
    PKAO BP SA

What is an example of an indexed loan clause?

  • "The Bank grants the borrower a loan in the amount of PLN (...) indexed to the CHF exchange rate, under the terms of the agreement (...)%r@."
    GE Money Bank SA (successor: BPH SA).
  • "The Bank grants the borrower a loan in the amount of (...) PLN denominated (valorized) in CHF, for a period of (...). The amount of the loan denominated (valorized) in CHF or tranches of the loan will be determined according to the foreign exchange purchase rate for the aforementioned currency in accordance with the exchange rate table in effect at the bank on the date of use of the loan or tranche of the loan%r@."
    Kredyt Bank SA (successor to Santander SA).

What is the legal basis for pursuing borrowers' claims?

The legal basis for asserting claims is primarily Article 385[1] of the Civil Code (on prohibited contractual provisions in consumer trade).

According to Article 385[1] § 1, provisions of a contract concluded with a consumer not individually agreed are not binding on him if they shape his rights and obligations in a manner contrary to good practice, grossly infringing his interests (prohibited contractual provisions). This does not apply to provisions defining the main benefits of the parties, including the price or remuneration, if they are unambiguously formulated.

Not individually agreed are those provisions of the contract on the content of which the consumer had no real influence. In particular, this applies to contractual provisions taken from a model contract proposed to the consumer by the counterparty (Article 385[1] § 3 of the Civil Code).

Given the above, the following prerequisites must be met in order to consider a given contract provision as non-binding in accordance with Article 385[1] § 1 of the Civil Code:

  • the contract was concluded with a consumer
  • The contract provision was not individually agreed
  • the provision of the contract shapes the rights and obligations of the consumer in a manner contrary to good practice, grossly violating his interests
  • the contractual provision does not relate to the main benefits of the parties, such as price or remuneration (unless they are not clearly worded)

Both the assessment of the compliance of a contractual provision with good morals, as well as the assessment of whether the provision shapes the rights and obligations in a way that grossly violates the interests of the consumer, is made at the time of the conclusion of the contract.

What is the legal basis for returning borrowers' benefits?

The invalidity of the loan agreement results in the fact that the payments made by the borrowers to date in performance of the agreement should be considered undue, resulting in the bank's obligation to return them in full under Article 410 § 1 and 2 of the Civil Code in conjunction with Article 405 of the Civil Code with Article 58 § 1 of the Civil Code.

The legal standard expressed in Article 410 § 2 of the Civil Code stipulates that a benefit is undue if the one who made it was not obligated at all, or if the legal act obligating the benefit was invalid and did not become valid after the benefit was made.

In the case of unfranchising, i.e., when the Court finds that the borrowers are not bound by the prohibited contractual provisions, but the contract can continue, there is no basis for paying installments using the valorization clause (prohibited provisions), and the installments paid so far, fulfilled in excess of the value of the loan installments to which the borrowers would have been obliged if they had paid the loan in disregard of the abusive provisions, is a benefit fulfilled without legal basis, which gives rise to the bank's obligation to return the unduly paid part of the benefit under Art. 410 § 1 and 2 of the Civil Code in conjunction with Article 405 of the Civil Code and Article 385[1] § 1 of the Civil Code.

Is litigation necessary?

In order to pursue a claim for the cancellation of a loan agreement, or its de-franchising, the bank does not automatically frank or de-franchise itself, so the court route is essential.

Can a settlement be profitable for borrowers?

The bank's settlement proposals are worth consulting with a lawyer and making an estimate of the benefits that are possible to achieve through litigation or settlement. The conclusion of a settlement with the bank usually comes with a waiver clause, and for this reason it is not possible to sue for the object of the settlement in the future.