Exclusion From the Class Action

16 March 2022

A court decision on the composition of a group in group proceedings may be challenged by a classic complaint to the court of the second instance, the Supreme Court has ruled.

In the case of 300 Swiss Franc credit holders represented by the Consumer Ombudsman in Szczecinek, the Regional Court determined the group’s composition, which was challenged by Bank BPH, which demanded the exclusion of some of the persons. The bank had doubts as to which court to address its complaint to and filed two complaints: one to the Court of Appeals in Gdańsk and the other to a different panel of this Regional Court. It pointed out that there are no provisions indicating the court competent to hear a complaint in such a case, and the practice of the courts is inconsistent after the entry of a major amendment to the Code of Civil Procedure in 2019.

When considering the complaint, the Court of Appeal raised doubts, which it formulated in a legal question to the Supreme Court: after the entry into force of the amendment to the Code of Civil Procedure of 4 July 2019, is the decision on the composition of the group pursuant to Article 17(2) of the Act on Pursuing Claims in Group Proceedings subject to a complaint to the court of second instance or another composition of the court of first instance?

The judges pointed out that the decision on the composition of the group is subject to a complaint, and before the amendment, it was heard by a higher court. However, the new provisions introduced the horizontal complaint to a different composition of the court of first instance, defining a closed catalogue of decisions subject to appeal under this procedure. This catalogue does not include complaints concerning the composition of groups in class actions.

One position assumes that an appeal to a higher level is still the rule. The other indicates that since the court of first instance is competent to determine the composition of the group, it is also competent to hear (in a different composition) a complaint against the decision.

The Court notes that the legislator has vested group proceedings with a special status, providing that these cases will be examined by a three-person bench of the Regional Court, which may also indicate that a higher instance should review complaints against decisions issued in such a composition.

The Supreme Court (judges: Jacek Grela, Marcin Łochowski, and Mariusz Łodko) decided in favour of appealing to a higher instance, adopting a resolution that a decision of the first instance court on the composition of a group in group proceedings may be challenged before the court of second instance.

‘Refusing the status of a group member for that person means termination of proceedings, which in its effects is equivalent to a return of the statement of claim. All that is left is to lodge an individual claim, and there is no possibility of re-joining group proceedings,’ assesses Dominik Gałkowski from Kubas Kos Gałkowski law firm. ‘Quicker recognition of the complaint (in a horizontal mode) should not be decisive in these proceedings because it requires more time due to the preliminary stages of case examination. Their better verification is ensured by the court of appeal, which is important for further proceedings’.

File ref. no.: III CZP 51/22


Edited by: Marek Domagalski

Originally published in Rzeczpospolita, 14 February 2022