Recognition of claim (recognition of debt). What's worth knowing?

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Piotr Kłodziński|
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What are the risks of recognizing a claim (recognition of debt)?

Polish civil law provides that usually a creditor (e.g. a lender, a credit grantor, a lessor, a seller) has a limited time to pursue his/her receivables in court from the debtor (e.g. a borrower, borrower, tenant, buyer). If during this period he does not decide to take official legal steps against the debtor (in particular, he does not file a lawsuit), the so-called limitation of claims.

Without going into detailed explanations, it can be said that the statute of limitations is associated with a very high probability of the creditor losing the court case (although not in every case). This means that recovering money, movable property (e.g. a car, work of art, jewelry) or obtaining compensation will depend on the good intentions of the borrower, borrower, tenant or buyer. It will be very difficult to force him to return the loan, repay the loan, pay the rent or pay the price, because the court, and at a later stage also the bailiff, will have their hands tied. For obvious reasons, the debtor usually wants the limitation period to expire and for it to happen as soon as possible. The creditor - on the contrary.

The length of limitation periods cannot be changed by legal action (especially in a contract). It does not matter whether the parties would like to act to the benefit of the creditor or improve the legal situation of the debtor. However, it is different to contractually determine the deadline for loan repayment, loan repayment, rent payment, or price payment, etc. This remains allowed. To put it simply, it is through agreement on the date of payment of the amount due, provision of a service or transfer of goods that we determine the beginning of the limitation period. It is from this moment that the time that, according to legal regulations, should elapse before the claim becomes time-barred is counted. The length of this period cannot be manipulated in the contract.

The above does not mean that the end of the limitation period cannot be extended. This takes place in various cases specified in the Civil Code (hereinafter referred to as the Civil Code). In this entry, we will focus on what the Act calls "interruption of the limitation period." This is the most advantageous option from the point of view of anyone who would like to effectively pursue their debts in court.

As a result of the interruption, the limitation period begins to run again. Colloquially speaking, all the time that has elapsed so far is "deleted". This may be brought about by the creditor himself by filing a lawsuit before the competent court or by taking other similar action. So you need to complete some formalities. However, there is also an opposite option - the recognition of the claim.

When is a claim recognized (recognition of debt)?

Recognition of claim (recognition of debt) is not defined in the Civil Code. The positions formulated in case law and scientific legal literature vary. In this entry, we adopt a view similar to that expressed by the Supreme Court - hereinafter referred to as the Supreme Court - in its judgment of September 16, 2022 (II CSKP 551/22). According to this view, the recognition of a claim (recognition of a debt) may result from any behavior of the obligor that proves his awareness of the existence of his obligation. Importantly, it is not necessary for the borrower, borrower, tenant or buyer to want to interrupt the limitation period. He does not have to be aware of the consequences of his actions. The only thing that matters is that it can be said that the borrower, borrower, tenant or buyer knows about his debt. It is also not required that he wants to repay the loan, repay the loan, pay the rent or pay the price.

It follows from the above that the debtor should be very careful in contacts with the creditor if he does not intend to lose the chance for the limitation period to expire soon. The other side is counting on his carelessness. It applies especially to the so-called a debt collection company that purchased the receivable (commonly referred to as debt purchase) shortly before the expiry of the limitation period. In such a situation, the debt collector may, for example, call the borrower, borrower, tenant or buyer with a proposal to divide the debt into installments. For the claim to be accepted, it is enough that the borrower, borrower, tenant or buyer begins to consider this offer. He will then admit that he knows about his debt. The limitation period will then be interrupted.

When should you not be afraid of having your claim recognized (recognition of debt)?

If the limitation period for the claim has already expired, it becomes impossible to interrupt it. Then, the loss of the benefits of limitation occurs on the basis of waiving the defense of limitation (waiver of limitation). At first glance, it seems similar to the recognition of a claim, but it should be emphasized that it occurs only if the actions of the borrower, borrower, tenant, buyer, etc. can be read as a declaration of the intention to waive the limitation period. It is no longer enough to simply confirm that the debt exists. After waiving the limitation period, its period begins to run from the beginning (judgment of the Supreme Court of September 14, 2022, I CSK 1896/22). The declaration in question may also be included in the settlement.

Notwithstanding the above, the recognition of a claim after the expiry of the limitation period may involve inconvenience related to the issuance of a payment order in penal order proceedings. However, this is a problem whose broader description will be left for another occasion.

Lawyer's help

The fact that the recognition of a claim (recognition of a debt) does not have to be made by uttering specific words certainly makes it difficult to assess whether the limitation period has been interrupted or whether one should accept the difficulties resulting from the limitation of the claim. A lawyer dealing with civil law cases can analyze the situation and express a professional opinion in this regard. Such assistance from a lawyer is extremely valuable because it allows you to make a prudent decision regarding whether to transfer the dispute to the courtroom level.

Filing a lawsuit in a situation where, due to the statute of limitations, the chances of recovering the money are slim will not only lead to loss of time and stress. It also involves a serious risk of incurring trial costs, including court costs - the greater the larger the amount of money involved in the dispute. Then, the only real chance to end the case to the benefit of the lender, creditor, lessor or buyer remains negotiations with the debtor. At this stage, the support of a lawyer also helps to obtain the best possible result.

Top sources:

Heat H, Statute of limitations and statute of limitations in a civil suit, Ius Novum 2015, no. 4

Górecka-Ochnio K., Inappropriate recognition in the light of changes to the Civil Code, Commercial Law Review 2019, no. 2

Radwański Z., Olejniczak A., Civil law – general part, Warsaw 2023

Private Law System. Civil law – general part. Volume 2, ed. Z. Radwański, A. Olejniczak, Warsaw 2019

Szlęzak A., Improper recognition as an event interrupting the limitation period, Przegląd Sądowy 2019, no. 1

Węgrzynowski Ł., Limitation of claims arising from an invalid Swiss franc loan agreement, Commercial Law Review 2021, No. 7

Wilejczyk M., Abuse of the statute of limitations by the debtor or failure to take into account the expiry of the statute of limitations due to special circumstances attributable to the creditor - de lege ferenda comments, Monitor Prawniczy 2014, no. 5

Wojewoda M., Kostwiński M, Taking into account the ex officio limitation period in civil proceedings (in the context of pursuing interest claims), Monitor Prawniczy 2021, no. 9

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