biznesprawnik.pl: Franc loans - the latest case law

Dear All,

The situation for francophiles in litigation with mortgage banks is becoming clearer and more favorable to borrowers. Recent jurisprudence, including judgments of the CJEU and the Supreme Court, confirm that the banks are losing in most cases, and the cancellation of franking credit agreements is becoming an increasingly common practice. As emphasized by barrister Damian Nowicki, a lawyer and leader of our firm’s litigation and debt collection department, the banks’ rare wins are usually the result of procedural errors on the part of the borrowers, which proves the importance of enlisting the help of an experienced lawyer before taking a case to court.

Recent Supreme Court resolutions significantly ease the handling of franking cases. The July 2024 resolution (III CZP 2/24) clarifies the issue of legal representation, eliminating the need for additional authorizations during the proceedings. In turn, the June 2024 resolution (III CZP 31/23) precludes banks from invoking the right of retention when they can set off claims. The most important resolution, however, came in April 2024 (III CZP 25/25), which makes it clear that invalid loan agreements cannot be “fixed” by introducing other provisions. In practice, this means that banks must return wrongfully charged loan installments, and borrowers are not liable for any additional fees or interest.

We encourage you to read the full article by barrister Damian Nowicki on our legal blog, biznesprawnik.pl, where we discuss in detail the latest rulings on franking credits.