Questions and answers following the CJEU judgment C-520/21 of 15 June 2023
The role of an instruction by the Court
Following the CJEU judgment of 29 April 2021 issued in Case C-19/20, a rule was introduced to the effect that in CHF mortgage cases the consumer should be informed of the potential consequences of the court allowing the consumer’s claims against the bank. The CJEU stated that it is for the national court to inform the consumer of any consequences of unfair terms, in particular if they were to lead to the annulment of the agreement (such annulment being usually included in the relief sought by borrowers). The idea is to ensure that a consumer who decides to challenge a contract in court is as fully aware as possible of the consequences they will face if the agreement is invalidated in court as per their claim. Although law firms representing borrowers generally claim that they have already advised the consumer of the consequences of annulment and that the consumer understands and accepts these consequences, it is emphasised that such information should come from the court, to make sure it is objective.
The CJEU judgment in case C-520/21 does not address this issue, but it will undoubtedly provide Polish courts with an important guideline on how to inform consumers about the consequences of annulment. In fact, courts have developed standard instructions, often sent to borrowers in writing – which, in light of the C-520/21 judgment, should now include as a minimum, information that as a consequence of annulment of a CHF loan agreement:
- The Bank may claim reimbursement by the consumer of the principal amount disbursed in performance of the agreement and, if applicable, the payment of default interest at the statutory rate (calculated from the due date, as it may appear from e.g. a notice to pay or a statement of claim filed by the Bank)
- The consumer may claim reimbursement by the Bank of the principal and interest payments and the expenses incurred in connection with performance of the agreement, as well as default interest at the statutory rate (calculated from the due date, as it may appear from e.g. a notice to pay or a statement of claim filed by the consumer)
- The consumer may also claim reimbursement by the Bank of any further performance (‘compensation’) arising from the performance of the invalid loan agreement, provided, however, that the objectives of Directive 93/13 and the principle of proportionality are observed. It should be noted that it is for the national court to assess the legitimacy of those claims and that the case-law of the Polish courts in this area is still in the process of being established, so it is not possible to give a precise indication of either the scope or the chances of success of such claims.
In CHF loan cases, indexation is an additional claim of the parties to an annulled loan agreement, intended to bring the value of the parties’ performances under the agreement to a certain degree up to date (e.g. banks made capital available to borrowers a dozen or so years ago, so a sum of e.g. PLN 100,000 paid to a consumer at that time now has a lower purchasing value in real terms than it did then).
In the light of the CJEU judgment C-520/21, it is not contrary to EU law for a borrower to claim ‘compensation’ from the bank (as stated in the Judgment, while this concept does not exist under Polish law) concerning the performance of an invalid contract, whereby the consumer’s claims may not compromise the objectives pursued by Directive 93/13 or violate the principle of proportionality. Thus, based on the CJEU judgment, consumers might claim reimbursement by the bank of instalments paid under an invalid agreement, in an adjusted (higher) amount. However, the chances of success of such consumer claims seem highly doubtful, as in the event that the settlement between the parties to an invalid loan agreement is made so that the bank is reimbursed (only) the nominal amount of the loan disbursed to the consumer years ago, objectively there will be no recoverable advantage (no enrichment) on the part of the bank.
However, the question of the right to assert analogous claims on the part of banks is not so clear-cut, despite the fact that the CJEU stated that Directive 93/13 precludes banks from being entitled to claim compensation from consumers. The above caution in the wording is due to the fact that the CJEU judgment C-520/21 gives some room for interpretation, as the concept of ‘compensation’ used therein does not exist under Polish law – and thus may raise doubts and be interpreted in various ways. On the other hand, the CJEU allows the bank’s claim for “reimbursement of the capital paid in respect of the performance of that agreement”, hence the ambiguity arises as to whether it is only a reimbursement of the nominal value of the capital made available to the consumer, or whether this reimbursement may be “updated” (which in Polish law would be based on Art. 3581(3) of the Civil Code). Finally, in accordance with the CJEU judgment, the merits of the parties’ claims arising from the invalidity of the agreement are decided exclusively by the national court.
The CJEU judgment C-520/21 of 15 June 2023 does not specify from when the parties to an invalid loan agreement may claim payment of statutory interest from each other. Although the judgment does state that both the consumer and the bank may demand “the payment of default interest at the statutory rate from the date on which notice is served”, this phrase loosely corresponds to Polish law, which will always be the basis for resolving CHF loan cases. In accordance with Article 455 of the Polish Civil Code, “If the time limit for rendering the performance is neither fixed nor stems from the nature of the obligation, the performance should be rendered without undue delay after the debtor is called upon to perform”. In this context, “the date on which notice is served” referred to by the CJEU is not relevant, nor is it the only date from which the maturity of the claim would run. Firstly, on the date of, for example, sending the notice to pay, the opposing party may not even know that a claim is being made against it. Thus, in accordance with Polish law, the relevant date for calculating interest will be the date of expiry of the deadline for payment specified in the notice (and if the notice did not specify any deadline, the performance should be rendered by the debtor “without undue delay” – which may be interpreted in different ways, nevertheless the earliest possible date for calculating interest is the day following the debtor’s receipt of the notice). However, a notice to pay is not the only action causing the claim to become due, as e.g. a statement of claim may be filed without first calling the debtor to pay – hence, in the case of a statement of claim, the day following the date on which the debtor received a copy of the statement of claim could be the starting date for the accrual of interest.
Furthermore, in CHF loan cases there are different views as to the starting date for interest accrual, such as that the borrower could charge interest to the bank only from the moment the consumer was instructed by the court about the legal consequences of a possible annulment of the agreement [cf. the first issue above], or only from the date the judgment annulling the loan agreement becomes final and non-appealable, or even only from the moment the borrower offered the bank to reimburse the loan principal received. In the context of such divergent views and the fact that the maturity of the claim (the interest starting date) should be examined under national law, it can be concluded that the CJEU judgment C-520/21 does not clarify precisely as to how interest should be calculated in CHF loan cases.
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