Debt acquisition – essence of the institution
The civilian Code in Article 519 introduces a debt-taking institution. It is that a 3rd organization may take the place of the debtor who is released from the debt.
Two models of the contract are defined in this provision, which could consequence in the taking over of the debt:
- agreement between a creditor and a 3rd party with the agreement of the debtor; the debtor's declaration may be made to either party, or
- agreement between debtor and 3rd party with the consent of the creditor; a message of the creditor may be made to either party; it shall be ineffective if the creditor did not know that the debtor was insolvent.
There is no uncertainty that the acquisition of debt is simply a two-member legal act. The first is simply a contract between the transferee and the debtor or the creditor, the second is simply a message of agreement to change the debtor. The debt acquisition agreement becomes effective only after the consent of the individual whose consent is needed to effectively take over the debt ().
Article 519 k.c. is an absolute provision in force, meaning that the change of the debtor cannot take place in any another way than that provided for in that provision. There is no uncertainty that the acquisition of the debt is due to the conclusion of an agreement between the debtor and a 3rd party, but that agreement is ineffective until the creditor has made a declaration of consent to it. Only the creditor’s submission of the applicable message results in an exemption from the debt (yes: Brzezin territory Court of 19 October 2015). Act No I C 581/15 ).
Successive (translative) debt takeover model
The provision of Article 519 §1 k.c. and subsequent implement a successional (translative) debt takeover model, which is the model that differs from the model of the fresh debtor change that the change of the debtor in respect of the debt of the amount specified in the takeover agreement does not affect the identity of the existing obligation.
The transferee of a circumstantial debt shall, to the degree specified in the contract for the taking over of the erstwhile debtor, be exempt from the debt, while retaining the identity of the undertaking taken over and without changing its entity configuration, in respect of the debt not covered by the takeover contract (judgment of 17 May 2007, III CSK 438/06) .
In another words, taking over the debt does not prejudice the content of the existing work relationship, and only a peculiar succession takes place on the part of the individual required to provide, meaning that the fresh debtor undertakes to satisfy the creditor, but only to the degree of the debt takeover agreement.
A 3rd organization so takes the place of the debtor but, to the degree specified in the agreement to take over the debt and only in this respect, the transferee becomes a fresh debtor of the creditor (yes: judgement of the ultimate Court of 19 November 2004, II CK 129/04, TSO 2006 No 2, item 19 with an approval vote; judgement of the ultimate Court of 23 January 2002, II CKN 888/99, LEX No 53307).
Consistent will of the parties to the debt takeover agreement
In order to recognise the contract as a debt-collection agreement as provided for in Article 519(2)(c) it is essential that the parties have a consistent will to take over the debt by a 3rd organization with the effect of exempting the erstwhile debtor from the debt.
The consent of the debtor to take over the debt by a 3rd organization on the basis of an agreement with the creditor may be expressed in any way, but any uncertainty as to the will of the 3rd organization and the creditor to step up the 3rd organization in place of the debtor, with the effect that he is released from the debt, excludes the classification of the contract as a takeover of the debt (judgment of 5 September 2002, II CKN 832/00).
Similarly, the ultimate Court stated in its judgement of 24 October 1978, Case No. III PR 110/78, LEX No. 8140, indicating that the taking over of the debt with effect against the creditor can only be considered if, in a legal act concerning the change of the debtor, the eligible creditor either straight participates or consents to it.
Form of acceptance of the debt by the debtor
The debtor's consent to take over the debt may be expressed in any way. However, it is not possible to approve the position of representatives of a part of the literature requiring, with mention to Article 63(2) of the Code, in conjunction with Article 522 of the Code, for the consent of the debtor in writing for evidence purposes (Article 74 of the Code). It follows from Article 63(2) k.c. that where a peculiar form is required for the validity of a legal act, the consent of a 3rd organization to do so should be expressed in the same form and so in the same manner as that provided for the legal act and under the same sanction (i.e. besides under the rigor of invalidity).
Since Article 522 of the Act of 1 K.c. reserves for the debt-collection agreement a written form under the rigor of annulment, Article 63(2) of the Law would besides apply to the consent to take over the debt of both the creditor and the debtor. Article 522 of 2 K.c. ordering, under the rigor of annulment, the retention of written form for the consent of the creditor, however, excludes the application of Article 63(2) k.c. not only with respect to the consent of the creditor but besides to the debtor. As provided for in Article 522 of 2 K.c., the reservation of nullity of the written form only for the consent of the creditor would be meaningless if the request of written form for the consent of the debtor under the same sanction resulted from Article 63(2) K.c.
As a consequence of Article 522 of 2 k.c., the repeal of Article 63(2) k.c. means, in relation to the consent of the debtor, to return to the regulation laid down in Article 60 k.c., i.e. the freedom of the debtor to express his consent to take over his debt by a 3rd organization on the basis of an agreement with the creditor.
The differences presented in the regulation of the form of the creditor's consent and the consent of the debtor correspond to the uneven importance of the request of each. In view of the risks to the creditor of taking over the debt, his consent should be the consequence of mature reflection and there should be no doubt. The accomplishment of these objectives is supported by a written form of annulment. As regards the consent of the debtor, these arguments are dropped due to the fact that it is fundamentally in the interest of the debtor to take over the debt. There is so no justification for the peculiar form (judgment of 26 June 1998, II CKN 825/97).
Time limit for consent
Any organization that has concluded a debt-taking agreement may designate a individual whose consent is needed for the effectiveness of the takeover, a reasonable time limit to express consent; the unsuccessful expiry of the deadline shall be unambiguous with refusal of consent.
Contractual modification of the organization to the undertaking
Polish law is not known as a normative institution to change the page. Therefore, a change of the full organization to the common work can be made by transfer of claims (Article 509 k.c.) and take over the debt (519 k.c.). It does not substance whether this is done in 1 complex act or successively. On the another hand, it is essential that the legal acts of the parties contain the elements essential for both institutions (judgment of 17 May 2012, I CSK 494/11).
Abstract nature of the borrowing agreement
The debt acquisition agreement has abstract character. The debtor shall not trust on the creditor to trust on the charges arising from the inter-existing the receiver of the debt and the erstwhile debtor the legal relation which is the legal basis for taking over the debt; however, this does not apply to the allegations which the creditor knew.
However, the debtor is entitled to any charges against the creditor which the debtor had previously had, but for the charge of deduction from the debtor's claim.
Prosecution as a way of agreeing to take over the debt.
The creditor’s agreement to take over the debt (Article 519(2) of Article 522 ) may constitute a written call for the transferee to comply with the obligation. Also, the action against the debtor to comply with the contract of taking over the debt constitutes the creditor's consent to this acquisition (judgment of 21 December 2005, IV CSK 305/05, non-publ.).
Depending on the effectiveness of the takeover agreement on the consent of the debtor or creditor
If the effectiveness of an agreement to take over the debt depends on the consent of the debtor and the debtor refused, the agreement shall be deemed not to have been concluded.
If, on the another hand, the effectiveness of the borrowing agreement depends on the consent of the creditor and the creditor of the consent refused, the organization who, according to the agreement, was to take over the debt shall be liable to the debtor for not being required to comply with the benefit.
Acquisition of debt and transition of the workplace to another employer
The issue of legal problems relating to the transition of a occupation establishment to another employer has been governed by labour law – through Article 23 1 of the Labour Code, which states that, in the event of the transition of a occupation establishment or part of it to another employer, it becomes legally organization to the erstwhile employment relationship. For the obligations arising from the employment relation arising before the transition of part of the establishment to another employer, the erstwhile and the fresh employer are jointly and severally liable.
There is so no basis for assessing this provision as lex specialis in relation to the provisions on the taking over of debt contained in the civilian Code (Article 519 KC). Article 519 KC shall not apply in this case. Article 23 1 of the NAP concerns employment relations, is simply a provision of labour law which governs matters relating to the existence of employment relations in the event of the transfer of an establishment to another employer (yes: ultimate Court judgement of 4 February 1999, II UKN 458/98).
Accession to debt
The contractual accession of a 3rd organization to debt, although the civilian code, unlike the erstwhile code of commitments, does not standard it, is permissible under contractual freedom (Article 353 1 k.c.) both in the form of an agreement between a 3rd organization and a creditor and a contract between a 3rd organization and a debtor. It does not require a circumstantial form (Article 60 k.c.), neither, in the first case, the consent of the debtor and the second, the consent of the creditor (yes: judgement of 6 November 1972 III CRN 266/72, OSNCP 1973, of 9, item 160).
Contractual prohibition on taking over debt
It is accepted in writing that the parties may exclude the anticipation of taking over a debt, limiting the effect of specified a possible agreement concluded without the creditor's consent to cumulative accession to the debt (P. Drapała, Cumulative Agreement... p. 48).
Debt acquisition and collateral
If the claim was secured by a warrant or a limited right in kind established by a 3rd party, the warrant or limited right in kind shall expire upon the taking over of the debt, unless the guarantor or the 3rd organization agrees to proceed the security.
Acquisition of future debt
A future debt may besides be the subject of a debt takeover agreement (yes: ultimate Court judgement of 3 November 1998, I CKN 653/98).
Free acquisition of debts by the company and income tax
The free acquisition by the company of the public debt of its partner leads to the receipt by the shareholder of income subject to taxation by income taxation on individuals, since, at the minute of the acquisition of the debt on the partner's side, a circumstantial financial dimension, consisting in a simplification in its liabilities.
Individual explanation of 19 December 2013 Minister of Finance stated that as a consequence acquisition of the debt of a shareholder of a public company by that company there will be a real asset benefit, for his debt will be taken over by separate economical operator. Therefore, the overt amount of debt which the company has taken over, on which the work to pay was imposed on the applicant, constitutes a taxable income from another sources as referred to in Article 10(1)(9) in conjunction with Article 20(1) of the Act of 26 July 1991 on income taxation on natural persons (Journal of Laws of 2012, item 361, as amended, hereinafter ‘u.p.d.o.f.’) (judgment of the ultimate Administrative Court of Warsaw of 14 February 2017, II FSK 115/15).
Joining debt and taking over debt in the context of own housing expenditure
Institution of debt accession is not the same as taking over the debt, and which functions in civilian law (Article 519 k.c.). It is on the basis of the borrowing agreement that a 3rd party, who is not a organization to the bond relationship, replaces the erstwhile debtor, who is so released from the debt. (judgment of the ultimate Administrative Court in Warsaw of 5 May 2016, II FSK 1083/14)
It is so appropriate that the Minister of Finance, in a situation where the parents of the payer concluded a mortgage credit agreement for the acquisition of the apartment, which they subsequently gave to the taxpayer, and she entered into a mortgage loan, then decided to sale the flat and the funds thus acquired to buy the fresh premises, the taxpayer, erstwhile entering into the credit debt, did not bear expenses for her own housing purposes but, if any, were expenses to assist the parents who carried them for housing purposes.
The fact that this flat was given to the daughter by the parents does not change the above assessment in any way, but on the contrary, confirms that the mortgage debt taken by the parents allowed them to buy this apartment.
The above, where from the acquisition of the flat 5 taxation years have not passedcause impossible the taxation payer's exemption from the sale taxation of the property in the amount that corresponds to the product of the income from the sale of the property and the share of expenditure incurred for own housing purposes in the return of the sale of the property (as provided for in Article 21(1) point 131 of the individual Income taxation Act).
More about this case: read here
Release from real property debts
If, in a real property transfer agreement, the acquirer has undertaken to exempt the seller from the debts associated with the ownership of the property, it shall be considered in the event of uncertainty that the parties have entered into a contract to take over those debts by the purchaser.
Acquisition of public-law debt
Provisions of the civilian Code on the change of debtor (Articles 519-526 k.c.) not applicable to taxation obligations (yes: ultimate Court judgement of 28 June 2002, I CKN 841/00).
The agreement to take over debt for late social safety contributions (Article 519 k.c.) is invalid. Social safety contributions are public-law benefits and the civilian Code amending the debtor does not apply to specified benefits (judgment of the ultimate Court of 10 February 2004, IV CK 56/03 — judgement given in fact, where the agreement to take over debts for late contributions constituted part of the contract to sale movable property as a form of payment of the price).
Non-admissibility of a change in the entity contract concluded following a public contract invitation to tender
A change in the entity’s contract following the invitation to tender shall not be permitted to take over public procurement.
The judiciary shall accept the inadmissibility of the succession of rights and obligations resulting from the contract concluded as a consequence of the tender. This position is correct as evidenced by the wording of Article 10a(1) of the Public Procurement Law . The basic procedures for the award of contracts are open tendering and restricted tendering.
The doctrine and the judicature emphasize that we are dealing with limiting the rule of freedom of contract expressed in Article 353 1 k.c. (see ultimate Court ruling of 13 December 1999, III CKN 478/98 – OSNC 2000, of 6, item 118, of 28 June 2000, IV CKN 70/00 – non-publ. and of 10 April 2003, III CKN 1320/00 – non-publ.).
This is due to the nonsubjective of the Public Procurement Law, which exposes public interest and eliminates corruption. Therefore, the acquirer may not trust on the contracting authority’s and the contractor’s agreement on ‘classification of its rights and obligations under the contract.
The transfer of the debt and the takeover of the debt in this situation cannot be effective.
The transfer of claims, which is clearly a causal act, is crucial here. The transfer of a claim shall always have its origin in another legal act, whether it takes the form of a contract requiring it to comply with the regulation (Article 510 §1 k.c.) or of a contract frequently governing it (Article 510 §2 k.c.). Where a transfer agreement is closely linked to a transfer agreement, it shall form a single full (compulsory-resolution agreement) and share its fate.
The collapse (invalidity) of the work agreement results in the collapse (invalidity) of the assignment. A akin dependence on the transfer on causal activities occurs in the situation referred to in Article 510(2) (judgment of 13 January 2004, V CK 97/03).
On the agreement to exempt the debtor from the work to supply a 3rd organization – read here
