Covid-19 impact on civil and insolvency matters

1 Covid-19 impact on civil proceedings

1.1 Time limits in civil proceedings

The Polish special legislation provides, among other things, for the suspension of a not yet started and postponement of commenced:

• limitation periods of enforcement of judgements,
• time limits in proceedings and for court's actions in legal proceedings, including in enforcement proceedings.

1.2 Judicial organization and Judiciary

Specific measures have been adopted to mitigate the negative consequences of the COVID-19 pandemic including.

The transfer of cases among Polish courts (by judicial authority and for a defined period in urgent cases as defined by the special legislation concerning mitigating impact of the COVID-19 pandemic on the Polish justice system) has been made possible.

The category of urgent cases is defined as following:

1. Proceedings concerning minors including:

• proceedings for the removal of a minor from parental authority or custody;
• proceedings concerning placement of a foreigner minor in a care and educational institution;
• proceedings for the establishment of a guardian to represent the interests of a minor in judicial proceedings;
• proceedings regarding placement or extension of a juvenile's stay in a juvenile shelter;
• enforcement proceedings involving minors.

2. Proceedings concerning mentally ill and incapacitated persons

The president of each competent Polish court may order that any case be considered urgent if the failure to adjudicate on such a case:

• could cause danger to human or animal life or health;
• could cause serious harm to the public interest;
• could cause imminent and irreparable material damage;
• and when urgent adjudication on such case is required by the interests of justice.

Detachment of judges to other courts is simplified. Decisions in that regard are taken by judicial authorities, in accordance with the principle of independence of judges and for a period of time defined in advance. Such procedures will enable to provide support courts experiencing a heavier caseload.

Suspension and postponement of court’s proceedings is also possible in certain cases.

1.3 EU Judicial Cooperation

Ministry of Justice employees working in the central authority are teleworking.

All communication to the Polish Ministry of Justice as the Central Authority (including service of documents and taking of evidence), or Polish EJN contact point must be sent through electronic means with necessary attachments in the form of scanned copies.

2 Insolvency related measures adopted or planned for adoption in member states after the outbreak of the pandemic

2.1 Substantive insolvency measures and related contracts affecting measure

2.1.1 Insolvency suspension

2.1.1.1 Suspension of duty to file for insolvency (debtors)

From 18 April 2020 a debtor’s duty to file for insolvency (if Covid-19 is the direct cause of insolvency) has been suspended for the whole period of pandemic risk.

2.1.1.2 Protection of debtors about insolvency filing from creditors

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2.1.2 Claim enforcement suspension and contract termination suspension

2.1.2.1 General / specific moratoria on claims enforcement / certain types of claims enforcement

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2.1.2.2 Suspension of contract termination (general / specific contracts)

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2.2 Civil, including insolvency courts suspension and procedural suspensions

Insolvency cases were classified as “urgent cases” from 16 May 2020 to 5 September 2020.

There was no general insolvency court suspension although many hearings have been cancelled.

Hearings are conducted online unless personal appearance does not pose an exceptional danger for participants.

2.3 Other insolvency measures (those relating to avoidance actions, reorganization plans, informal agreements, and others if appropriate)

Restructuring procedures contained in the Restructuring Law contain solutions that weigh the interests of both the debtor and his creditors and serve on the one hand to maintain the existence of the debtor and on the other hand to satisfy creditors as effectively as possible. So they should not by definition be considered detrimental to debtors.

On 24 June 2020 a new restructuring procedure has entered into force (simplified restructuring procedure). It enables debtors to start a restructuring process without a court approval in order to take quick and efficient action when the likelihood of insolvency appears. Starting this procedure causes a general stay on claims enforcement.

2.4 Related non-insolvency measures (payment deferrals, bank loans, social security, health insurance, business subsidies)

Under the new “anti-crisis shield”, state aid may be given to an entrepreneur in a difficult economic situation (risk of insolvency) who meets the criteria of an entrepreneur threatened with insolvency (art. 141 section 2 of the Restructuring law) or is insolvent (Art. 11 of the Bankruptcy law) who meets also other criteria

For the whole period of pandemic risk the possibility of eviction a natural person from a dwelling is excluded.