- The factual basis of the dispute is a set of facts substantiating the claimant’s demand – this basis must include the facts substantiating the legal relations being the object of the dispute above all else. To substantiate the homogeneity of the factual basis, an indication of the event in the form of the broadcasting of advertisements, subsequently recognised to be an act of unfair competition by another court was sufficient.
- The assessment of the admissibility of group proceedings is of a formal nature and should not be preceded by the assessment of the reasonableness of the claims.
- Proving the individual damage of each group member, the existence of a causal relationship between the event and the damage as well as the scope of the suffered damage do not constitute the premises of the admissibility of group proceedings. In terms of the admissibility of examining the case in group proceedings, the Act on Pursuing Claims in Group Proceedings does not provide for the requirement of the claimant to prove their claims or even make them plausible.
- The expected evidence difficulties shall not prejudge the inadmissibility of group proceedings.
The decision was reversed in part (in the scope of points 1 and 4) by the decision of the Court of Appeals in Warsaw 6th Civil Division of 7th September 2015, VI ACz 1012/15.
- We are dealing with “the same” (identical) factual basis of the pursued claims when the identicalness of factual circumstances takes place and the legal protection is pursued by the participants of one event, meaning that there is a link based on the fact that the same event caused the damage. The notion of “factual basis” should be understood as a specified set of factual status elements which is invoked in order to prove the claims.
- The same factual basis of the claims occurs when obtaining legal protection is connected with an identical situation or event. In turn, the same factual basis is spoken of when claims are derived only from similar situations and events, which corresponds with the notion of the similar (equal) factual basis being an element of formal joint participation in civil proceedings.
- We are dealing with “equal” factual basis when many similar factual events take place. The basic set of facts constituting the basis for the occurrence of the disputed legal relationship and a specific claim must be analogous. Slight differences between individual bases of claims may exist, however, the relevant factual circumstances must substantiate a demand common for all the claims.
- The substance of group proceedings is the commonality manifested in the demand which must be typical (common) for all the claims, and is derived from the same legal or factual situation of all members of the group. On the one hand the legislator does not require the identicalness of all of the factual elements, as this would highly narrow the scope of the application of the Act on Pursuing Claims in Group Proceedings, however, on the other hand, the group proceedings would not fulfill their objective – improvement in the effectiveness of proceedings in cases characterized by a significant level of the individuality of the facts and the characteristics of the individual group members. Group proceedings fulfill their role when we are dealing with “typicalness” or “representativeness” of the claim towards all of the group members. The condition of “typicalness” is fulfilled when a legal or factual situation of the group members is equal. Of course, slight differences can exist between the individual grounds of the claims, however, it is necessary for the material factual circumstances to substantiate the common request for all of the claims.
- Raising alternative claims in group proceedings leads to a situation where the court determines whether each of the raised claims is common for all members of the group; otherwise, the guiding goal of the group proceedings would be forfeited, whereas the proceedings themselves would be reduced to deciding on various claims of 10 people (members of the group) against one defendant.
- In the case of the definition included in Article 221 of the Civil Code, the linguistic interpretation fails; hence, this provision must be interpreted by means of a systemic and teleological interpretation. In the light of the definition of the “economic activity” it must be assumed that the fundamental condition of attributing a given act in law the characteristic of “being related to the conducted economic activity” is for this act to be taken by the entity performing it in order to achieve an profit making objective. The moment decisive for the recognition of a given natural person as a consumer, is the moment of performance of the act in law.
- In group proceedings, a statement of claims is treated as a whole and rejecting it only in relation to certain members of the group is not possible.
The decision was reversed by the decision of the Court of Appeals in Warsaw of 7th September 2015, file ref. no. VI ACz 1012/15.
- Fulfilling the precondition of the homogeneity of claims pursued by members of the group in principle requires all claimants (members of the group) to request the granting of legal protection in the same form, and therefore it requires all claimants to raise the same demand. Thus, it is fitting to draw attention to the fact that in the assessment of the Court of Appeals in this composition, homogeneity of claims mentioned in Article 1.1 of the Act on Pursuing Claims in Group Proceedings undoubtedly refers to procedural claims whereas not to substantive law claims. The legislator did not at all make the possibility of pursuing a claim in group proceedings dependent on its being based on the same substantive law basis.
- The legislator did not rule out a possibility of pursuing more than one claim in group proceedings. Therefore, in this situation, the appropriate application of Article 191 of the Code of Civil Procedure in such proceedings must be recognised as admissible.
- The legislator’s unquestionable intention was to facilitate (and not render more difficult) pursuing claims by consumers or parties who sustained damage in connection with a hazardous product or tort. Thus, the interpretation of the provisions of the Act on Pursuing Claims in Group Proceedings should be carried out in such a manner as to render pursuing such claims easier for group members.
- The given entity does or does not have the capacity to be a party to legal proceedings. The capacity to be a party to the proceedings cannot be divided and does not depend on territorial competence of the given entity. A district (municipal) consumer ombudsman has the capacity to be a party to group proceedings even when persons from outside of their competence area join the group.
- As a district (municipal) consumer ombudsman may be a group representative, they are also entitled to conclude the agreement indicated by Article 62 of the Act on Pursuing Claims in Group Proceedings.
- The case may be examined on the basis of the Act on Pursuing Claims in Group Proceedings when the following conditions are fulfilled. Firstly, the pursued claims are homogeneous, e.g. pecuniary claims. Secondly, at least ten persons establish a group to pursue claims. Thirdly, the claims are based on the same or equal factual grounds. The “equal factual grounds” are defined as similar events – this corresponds with the phrase “same factual grounds” which are one of the premises of formal joint participation in civil proceedings.
- The variety of terms and conditions of individual agreements and model contracts, which the members of the group and the defendant were parties to; the fact that some of the agreements were concluded directly with the insurer and some with the intermediary (agent) as well as differences in a way the information obligation was served – all these circumstances do not prejudge that the premise of a common factual basis of the claims shall not be fulfilled. Different amounts of contributions, various frequencies they were being paid at and various amounts of purchase fees that were applied in agreements of particular group members also do not change this assessment. The claims of all group members were based on the same – on the contractual clause that entitled the defendant to charge purchase fees, which the claimant considered to be excessive.
- The defendant, motioning to oblige the claimant to submit a deposit to secure the costs of the proceedings, should include a substantiation that the pursued claim is clearly unfounded or that accepting the claim is highly improbable, what would justify a conclusion that the claim bears the traits of “frivolous litigation”. The defendant should also substantiate that lack of a deposit for securing the defendant’s future claim for the recovery of costs will make the enforcement of the claim impossible or severely hampered.
- The admissibility of group proceedings, on the grounds of Article 1.2, provided the action is limited to the demand of the establishment of the defendant’s liability (Article 2.3), is decided by the legal qualification of the claim that the members of the group intend to pursue in the later cases with the use of the precedent obtained in group proceedings. If such a claim falls within the subjective scope of the Act indicated in Article 1.2, group proceedings on the establishment of the defendant’s liability is admissible. The Court can establish the existence of an interest in initiating group proceedings on the part of the group members on the basis of the future monetary claims indicated therein. The Court can, for this purpose, call upon the group members to specify the individual claims, which they intend to pursue on the basis of a precedent obtained in group proceedings.
- Establishment of liability on the grounds of Article 2.3 of the Act should be understood autonomously with the consideration of the goals and functions of the group proceedings. Specifically, the establishment of liability is not identical with the recognition of the claim as substantiated, in fact as in the case of the judgement as to the principle (Article 318 of the CCP).
- The issuance of a declaratory judgement regarding a large group of persons in group proceedings is aimed solely at establishing the defendant’s liability for an indicated event – this does not, however, refer also to the establishment that damage was incurred by each of the individual group members. The subject of group proceedings, with the demand of establishment, is only mutual circumstances of all of the group members, and not individual circumstances of the individual members, which will not be examined until further individual trials. The probability that the damage occurred, although in group proceedingsthe court may prejudge this stance firmly if this is possible and purposeful, should be deemed as sufficient.
- The establishment of the defendant’s liability in a case for monetary claim resulting from a tortious act constituting one event (article 2.3 in conjunction with Article 1.1 and 2) is admissible in group proceedings also in a situation in which the precondition of incurring damages and their amount is dependent on individual factual circumstances regarding the individual members of the group. The facts pertaining to the amount or the maturity of specific, individual claims should not be taken into consideration in the examination and assessment on the grounds of Article 1.1 of the Act on Pursuing Claims in Group Proceedings of the identicalness of the factual basis of the claim, or whether it is the same.
- The non-submission by one of the members of the group of a declaration on acceding to the group, provided for in Article 12, does not lead to the inadmissibility of group proceedings in relation to all group members on the grounds of non-adherence to the observatiton of the homogeneity of the claim condition. The Court should consider this circumstance in the decision on the establishment of the composition of the group (Article 17.1), by not including this person in the composition of the group.
- Even if the indicated event can also lead to the violation of a personal interest, the compensatory claim for incurring pecuniary damages in relation to this event, is not a claim on account of a tortious act on the protection of personal interests in the meaning of Article 1.2.
- Establishing by the court composition of a group with omission of a part of the persons who have submitted a declaration on joining the group, in the event in which the omission is compliant with the claimant’s statements expressed in the course of the proceedings may be recognised to have been made by the claimant themselves. It does not definitely close the possibility for the omitted persons to demonstrate their membership in the group. Such parties may join the group under Article 11 et seq. of the Act of 17 December 2009 on Pursuing Claims in Group Proceedings by submitting a declaration on joining the group.
- Establishing the composition of the group with the omission of a part of persons who have submitted a declaration on joining the group provides no grounds for the partial rejection of the statement of claims in relation to such parties.
- Admissibility of examination of a claimant’s alternative claim in group proceedings is conditioned by the fulfilment of the requirement for such an alternative claim to be based on the same or equal (similar) factual basis and the value of the claim of each member of the group to be standardised in considering common circumstances of the case.
The Regional Court for Warsaw-Prague in Warsaw 3rd Civil Division in the following ruling bench:
Presiding Judge: Ewa Dietkow, Regional Court Judge
Judges: Beata Karczewska-Mazur, Regional Court Judge, Radosław Olszewski, Regional Court Judge
having examined on 28th October 2014 in Warsaw at a hearing in camera in a closed session the case filed by S.P. against (…) Ltd. in Z. for payment
hereby decides to:
establish the following group membership:
Subgroup 1:
- [2 persons]
- [1 person]
- [1 person]
Subgroup 2:
- [2 persons]
- [2 persons]
- [2 persons]
Subgroup 3:
- [2 persons]
- [2 persons]
- [2 persons]
Subgroup 4:
- [2 persons]
- [1 person]
Subgroup 5:
- [1 person]
- [1 person]
- [1 person]
Subgroup 6:
- [1 person]
- [2 persons]
Subgroup 7:
- [2 persons]
- [1 person]
Subgroup 8:
- [2 persons]
- [2 persons]
Subgroup 9:
- [3 persons]
- [2 persons]
Subgroup 10:
- [2 persons]
- [1 person]
Subgroup 11:
- [2 persons]
- [2 persons]
Subgroup 12:
- [1 person]
- [1 person]
- [1 person]
Subgroup 13:
- [2 people]
- [1 person]
Subgroup 14:
- [1 person]
- [3 persons]
- In group proceedings the demand must be typical for all the claims. Therefore, the demand raised in group proceedings by the group’s representative must be typical for the entire group he or she is representing. The indicated condition means that a legal or factual situation of the group members must be equal. Of course, slight differences can exist between the individual grounds of the claims, however, it is necessary for the material factual circumstances to substantiate the common request for all of the claims.
- The group’s representative is obligated to prove a given person’s membership in the group before the court. It is a prerequisite allowing for the inclusion of a specific person within a group bringing a group action in cases on pecuniary claims.
The decision was reversed by the decision of the Court of Appeals in Warsaw of 31st March 2015, file ref. no. I ACz 166/15.
- The scope of the action is determined by the claimant and the statement of claims determines the frames of the further proceedings. However, the scope of the proceedings is not identical with the scope of the statement of claims. The proceedings do not always use all the factual circumstances indicated by the claimant, it is also necessary to establish facts not indicated in connection with the claim’s construction. The scope of proceedings will in the future determine the scope of adjudication of the case. In examining the admissibility of the group proceedings, the court must first and foremost assess what claim the claimant is bringing forth and what circumstances the claimant should prove with this claim. Only in further order it is possible to assess whether these circumstances will pass the test from Article 1 of the Act on Pursuing Claims in Group Proceedings.
- An action for the establishment of liability is an action for establishing a principle, without awarding compensation. In the frames of an action for the establishment of liability the court does not examine circumstances impacting the determination of the compensation amount.
- In the Polish legal system, participation in the group is voluntary. Potential joining to the group after the action is allowed to be examined in group proceedings entitles the defendant to file allegations related to membership in the group. The grounds for such an allegation may also be the lack of the similar factual basis of the joining member’s claim. At the stage of the assessment of admissibility of group proceedings there are neither grounds nor the need to examine the factual circumstances in the context of potential future members of the group.
- The assessment of the State Treasury’s liability towards individual members of the group must have an individualised nature. The domination of elements individual for group members over common issues renders the settlement of the case concerning tortious claims impossible in group proceedings.
- Deciding on the admissibility of group proceedings is the first stage of the proceedings and constitutes the form of a unique prejudication, unrelated to the content-related assessment of the legitimacy of the claims pursued in the statement of claims.
- The Act on Pursuing Claims in Group Proceedings does not contain a definition of a consumer protection case or a definition of a consumer. Therefore, invoking Article 221 of the Civil Code, it is fitting to indicate that a consumer is considered to be a natural person performing an act in law not directly related to their economic or professional activity.
- The role of the group representative filing a statement of claims in a group proceedings consists in providing a convincing substantiation that pursued claims of all group members, grounded on many legal bases, are based on the same or equal factual basis.
- If each of the members of the group identifies the damage inflicted thereupon by the defendants with the loss of funds paid to the company in performance of the agreements concluded therewith and predicted profits, then from this point of view, the type of agreements and conditions of their conclusion become a substantial, differentiating circumstance of the factual status.
- The legislator rendered the notion of a “subgroup” more precise – it covers at least 2 persons whose claims, due to varied circumstances concerning individual members of the group, may not be standardised in the frames of a group. A subgroup is comprised of a set of parties whose claims, due to the occurring diversification (rendering standardisation within the group impossible), are standardised by forming a separate set of parties (called a subgroup).
- The standardisation of claims in the frames of a subgroup consisting solely on the fact that group members’ claims are being adjusted to the value of the lowest of them, without indication of other than the value of the damage criteria for claims standardisation, in the face of many differentiating factual circumstances existing in the case, seems insufficient.
