Contracts and commercial transactions

[Warsaw, 06.06.2006] The key rule of the Polish law of obligations is the freedom of agreements included in Article 353(1) of the Polish Civil Code. Pursuant to the above regulation, the parties entering into an agreement may shape their legal relationship at their discretion, provided, however, that its content or goal is not in conflict with the nature of the relationship, the law or the principles of social co-existence.

A debtor should perform its liability in accordance with its content and in a manner corresponding with its social and economic goal and the principles of social co-existence and, if any grounded customs exist, in a manner corresponding with such customs. The creditor should co-perform the liability in the same manner.

However, it should be remembered that there are numerous exceptions to the above rule. A number of agreements, such as sale, barter, agency, donation, order or contract on performance of a specified task, were regulated under the Civil Code of 18 May 1964 and, if the parties do not agree otherwise, the provisions of the Civil Code apply automatically, which may, undoubtedly, be of surprise to a foreign entrepreneur. In addition, there exist regulations which the parties are not able to exclude under an agreement and whose non-observance may result in invalidity of the entire contract since, pursuant to Article 58 §1 of the Civil Code, an act in law inconsistent with the law or aimed at circumventing the law is invalid (unless the regulations provide for different consequences in a given case).

Therefore, the signature of any agreement governed by Polish law should be preceded with consultations on its compliance with Polish law. Agreements governed by foreign law and pertaining to property rights in Poland should be evaluated and reviewed in view of the provisions of Polish law which force their applicability (for example, to the form of an act in law).

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