Does a summons to settle interrupt the limitation period? The Supreme Court will resolve the longstanding issue of prolonging proceedings.

On 16 October 2020, the Supreme Court, in case no. IV CSK 107/20, submitted the following legal questions to be resolved by an enlarged panel:

1. Can a request to initiate settlement proceedings interrupt the limitation period of a claim, and if so, does the interruption depend on whether the creditor could reasonably believe — given the debtor’s conduct — that the conciliation proceedings might result in a settlement?
2. If a request to initiate settlement proceedings results in such proceedings being conducted, is it permissible, during the trial proceedings, to determine that the limitation period was not interrupted?

Case law concerning the issue raised in the first question generally supports an affirmative answer. However, there are critical voices in legal scholarship which refer to the requirement expressed in Article 123 § 1 point 1 of the Civil Code, stating that an act carried out before a court or other competent authority must directly aim to assert, determine or satisfy a claim. Proponents of this view argue that, in practice, the institution of requesting conciliation is often used merely as a tool to extend statutory limitation periods and not from a genuine intention to resolve the dispute amicably. The legislator has recognised this phenomenon and has attempted to limit it by significantly increasing the fee for submitting a request to initiate settlement proceedings.

The Supreme Court has emphasised that, in this context, it is particularly important to assess the conduct of the debtor and determine whether there was any real basis for the creditor to expect the possibility of reaching a settlement. The drawback of adopting such an approach is that it would indirectly allow the debtor to influence whether a request for conciliation results in the interruption of the limitation period.

The second legal question concerns the stage of proceedings at which an assessment should be made as to whether a request for conciliation was submitted solely to interrupt the limitation period. Such a finding could lead to the conclusion that the limitation period was not interrupted. However, there is uncertainty as to whether this evaluation should be made during the conciliation proceedings themselves or only at a later stage — during the main trial proceedings concerning the claim in question. In some Supreme Court rulings, it has been held that the absence of such a finding during the conciliation proceedings precludes its consideration in subsequent trial proceedings. In contrast, other judgments indicate that this assessment should be carried out during the proceedings in which the claim is pursued and in which the defendant raises the statute of limitations as a defence.

The Civil Chamber of the Supreme Court will resolve these issues sitting in an enlarged panel of seven judges. The ruling will have fundamental implications for addressing the widespread systemic practice of significantly extending statutory limitation periods. Given the positions taken in legal doctrine, existing case law, and the need for legal certainty, the Supreme Court’s evaluation will require thorough consideration of the future implications of its decision.