For several years, Polish courts have been regularly considering cases concerning prohibited contractual provisions contained in the so-called “Commercial Contracts”. Swiss franc contracts. Initially, they were reluctant to accept the arguments presented by the borrowers in the course of the trial. They did not see how banks, by constructing loan agreement templates, violated the interests of consumers by transferring to them the (in practice unlimited) risk of changes in the indexation currency exchange rate. Only the case law of the Court of Justice of the European Union and the landmark judgment in the Dziubak case of 2019. decided to change the line of case law in Poland. At present, national courts have no doubts that loan agreements indexed and denominated in Swiss francs contain abusive clauses, and after their elimination – the agreements cannot be performed, which makes it necessary to declare them invalid.
Courts commonly point out in the justifications for their judgments that banks failed to comply with their disclosure obligations, and the provisions imposed on consumers gave banks a tool to influence the amount of consumer benefits vis-à-vis banks. Can the recent years of experience developed in Swiss franc cases translate into the way cases of PLN borrowers are handled? There is no shortage of information about further lawsuits brought against banks by borrowers who are trying to undermine loans with variable interest rates based on the WIBOR benchmark.
Although the loan agreements are purely PLN and the so-called Swiss franc contracts (which, after all, were also executed in zloty, and the Swiss franc introduced in the agreement was to serve only as an indexation mechanism) differ in the basic elements of the agreement, so the manner of challenging their provisions in court will be similar.
In both cases, borrowers can point to three main categories of arguments that undermine the banks’ actions in the course of concluding contracts. Firstly, the banks’ failure to comply with their information obligations towards the consumer (information). Secondly, the transfer of the risk associated with the contract (risk) to the consumer. And thirdly, on the bank’s influence on the amount of the consumer’s benefit (making the amount of the benefit dependent on one of the parties to the contract).
In the case of Swiss franc contracts, consumers were not reliably informed about how a change in the Swiss franc exchange rate may affect the amount of their liabilities to the bank. The fact that an increase in the CHF exchange rate would result in an increase not only in the loan installment, but also in the debt balance, in practice surprised borrowers after signing the agreement. In fact, the borrowers did not know how the banks set the exchange rate at which the amount of the loan taken out and the amount of repaid installments were converted – and thus they did not know what the cost of the loan actually was.
In the case of PLN loans, the allegations relate primarily to the lack of explanation of when and how the interest rate changes, as well as the possible consequences and scale of such changes. Banks have often left borrowers with laconic information about the dependence of the interest rate on the WIBOR rate, without more detailed explanations as to how and who determines the rate. In both cases, there was also no illustration of possible changes in the course of the performance of the agreement – e.g. in the form of presentation of historical data and simulations for changes in the exchange rate and changes in the interest rate, respectively.
When it comes to banks shifting the risk associated with the contract to the other, weaker party to the contractual relationship, in the case of Swiss franc contracts, it was obviously about the exchange rate risk. It was the borrower who felt the change in the exchange rate of the foreign currency – painfully if the exchange rate of the foreign currency increased, and with it the amount of the liability to the bank. In practice, this risk was not limited by anything, and its scale was impossible to predict. As a consequence, the full repayment of the loan could remain out of the borrower’s reach, despite the fact that the loan had been repaid in accordance with the agreement for several or even several dozen years.
In the case of PLN loans, borrowers bear the variable interest rate risk resulting from fluctuations in the benchmark – in other words, although an increase in the benchmark will not affect the amount of outstanding principal, the amount of interest that the borrower must repay will increase, and thus the total cost of the loan will increase. Neither the bank nor the consumer at the time of concluding the agreement know how the interest rate on the loan will develop over the years, but it is the consumer who must take on the risk of any changes.
The greatest discrepancies can be observed in the third category of arguments, i.e. the influence of one of the parties to the contract (the professional) on the amount of the other (the consumer’s performance). In Swiss franc cases, it is these arguments that usually turn out to be decisive – the courts consider abusive the provisions of the agreement under which the bank provided itself with the possibility of setting exchange rate tables and thus deciding on the amount of exchange rates needed to convert, for example, the amount of the next loan installment, and thus – in practice – the possibility of unilaterally determining the final amount of the borrower’s benefit for the repayment of the loan taken out with the bank.
In the case of loans based on variable interest rates, this issue is more complicated. The WIBOR benchmark is not determined independently by the bank that is a party to the loan agreement, but by an independent entity (currently GPW Benchmark S.A.) – on the basis of data provided by banks. However, doubts arise that the same banks, which, as participants in the so-called They provide the input data necessary to determine the ratio and receive remuneration from borrowers in the form of interest instalments, the amount of which is determined on the basis of this ratio. Therefore, although the bank does not have a direct influence on the formation of the ratio used in the loan agreement, such an impact cannot be indirectly excluded – as the data provided by the bank do not relate to actual interbank transactions, but are in the nature of declarations, and at the same time are not made public – and thus are not subject to external verification. Importantly, for the assessment of the provisions of the loan agreement by the court in terms of their abusiveness, it is irrelevant whether the banks in any way actually exerted influence on the content of the data provided to the indicator administrator (by overstating the data). The only thing that matters is whether the contract objectively gave them such an opportunity (Art. 3852 of the Civil Code), and as the administrator of the indicator himself points out, the amount of WIBOR depends on the pricing policy of the entities providing the data, and the administrator has no influence on it.
It follows from the above that history may repeat itself – PLN borrowers have already blazed trails and an open way to pursue their claims in court. Many issues that have already been worked out on Swiss franc loans can be translated into disputes concerning WIBOR, such as the legal consequences resulting from the invalidity of the loan agreement or the method of calculating the limitation period for claims of the parties arising as a result of the collapse of the agreement. Therefore, although challenging WIBOR-based contracts is certainly a difficult challenge, the current practice of case law shows that courts are not afraid to stand up to consumer protection, even despite pressure from the banking community.
 Judgment of the Court of Justice of 3.10.2019, C-260/18.