Background

Planning consents for new developments, building permits, local zoning plans…these are fundamental aspects of the world of development finance. Decisions on these matters are made by local and central government bodies. In the past, approvals given by the executive have been vulnerable and difficult to rely on. It was always possible to have such decisions overturned if a person could show that they had been issued in violation of the law. Significantly, this type of challenge was not restricted to any prescribed time limit. Decisions could be overturned, for example, 60 years after they were made.

In a bid to promote certainty of law, time limits for proceedings to overturn administrative law decisions have now been introduced. This pragmatic move has generally been welcomed by real estate market participants. 

Amendments

On 24 June 2021, the lower house of the Polish Parliament (the Sejm) adopted some very significant amendments to the Code of Administrative Procedure (CAP). The amendments relate to proceedings commenced to invalidate decisions made by public administrators. The following changes to the law have been introduced:

• a 30-year time limit to commence proceedings and to ask the higher instance courts to declare a decision invalid because it was issued without legal basis or in gross breach of law
• a 10-year time limit to apply to the issuer of the invalid decision to declare that such decision was invalid and to issue a new valid decision (also as a result of the higher instance order).

The Act also discontinues all administrative proceedings conducted in violation of the above deadlines. If, for example, proceedings were commenced some 40 years after the supposedly invalid decision was made, those proceedings will now be cancelled.

Progress

The Act passed through the upper house (the Senate) in July 2021 and three further amendments have been put forward:

• extending the number of prescribed reasons for initiating invalidity proceedings
• giving the law courts a way to allow a person pursuing a 30+ years' claim for invalidity to sue for damages (even though he would be barred from reclaiming his property)
• extending the time period between the publication of the Act and its coming into effect to three months.

The Act has now been executed by the President of Poland.

Reactions

The Supreme Court and the General Prosecutor expressed positive and unqualified opinions regarding the proposed bill at the parliamentary work stage. 

Others have a few reservations:

• the Union of Polish Metropolises have similar views to those of the Senate, pointing to the difficulties of resolving pending cases and that the three-month vacatio legis is too short
• the General Prosecutor's Office has argued that the 30-year period is too long. It should be noted that there is already a construction carve-out, which provides that it is impossible to declare a construction permit decision invalid if 5 years have passed since it was delivered or announced.  Shouldn't the time limits prescribed here be more in alignment with this exemption? 
• More generally, some have noted that the amended law will have a decisive impact on reprivatisation proceedings. Of great political sensitivity are pending cases of individuals of Jewish origin who were evicted from their real estate during the Second World War by Germans. These individuals are now challenging those expropriation decisions as having been issued after the war by communists in gross breach of law. The Act will close the way for them. Proceedings that have already been initiated will be discontinued.

Comment

Although the introduced changes have a strong political overtone, they also provide a specific solution to difficult and protracted reprivatisation proceedings. Whenever formerly expropriated people assert their alleged ownership after so many years, their claims have had a negative impact on the lives of many current residents, as well as on the judiciary. The amendment should therefore be viewed favourably, as it is in keeping with the principle of legal certainty. It also protects the current state of affairs. Furthermore, the positive impact of the Act on future cases should not be forgotten.