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They were in danger of losing their home because of the mortgage. There is a decision of the Supreme Court

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The Supreme Court overturned the decision of the District Court in Legnica appealed by the Financial Ombudsman and declared the mortgage loan agreement unlawful – the Financial Ombudsman’s Office informed on Friday, emphasizing that the bank’s customers were protected against losing their home.

The Financial Ombudsman took action in the case of clients who in 2006 concluded a mortgage loan agreement as consumers. Pursuant to the provisions of the agreement, the bank granted the defendants a mortgage loan in the amount of over PLN 50,000. Swiss francs. The bank set the interest rate as variable, but in no document did it indicate what it consists of, which in turn enabled it to arbitrarily change the interest rate – emphasized the Office of the Financial Ombudsman.

One-sided and unfavorable for the consumer method of calculating installments

The loan was disbursed in zlotys after the loan amount was converted at the currency purchase rate in accordance with the table exchange rates for mortgage products in force at the bank on the loan disbursement date. The loan could only be repaid in PLN, after conversion at the selling rate of a given currency according to the table of exchange rates in force at the bank on the day of repayment or receipt of funds, at the time of making the exchange rate conversion. This proves a one-sided and unfavorable from the consumer’s point of view method of calculating the amount of installments – stated the RF Office.

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The Office of the Commissioner for Human Rights reports that in January 2019, after nearly 13 years of repaying the loan, a lawsuit was filed with the District Court in Legnica for payment in order for payment. The bank filed a claim for payment of nearly PLN 43,000. Swiss francs, the amount of which was to result from the statement from the bank books.

In the lawsuit, the bank referred to the termination of the contract (due to the customer’s failure to repay the loan), and then called on the borrowers to pay.

The court issued an order for payment in writ-of-payment proceedings. In May 2020, the bailiff notified the debtors of the initiation of enforcement. In July 2021, the first real estate auction was planned, which, however, did not take place on the originally set date.

The line of the Supreme Court ruling has been worked out

After analyzing the loan agreement, the Financial Ombudsman’s Office stated that conversion clauses referring to exchange rate tables set unilaterally by the bank, without indicating objective criteria, are non-transparent, leave room for arbitrary action by the bank and thus burden the borrower with unpredictable risk and violate the equality of the parties, therefore they grossly violate consumer interests and are contrary to good practice. It added that in October 2021, the Financial Ombudsman filed an extraordinary complaint, which turned out to be effective. In the judgment of June 20, Supreme Court considered the Defender’s arguments and referred the case for reconsideration (file reference number II NsNc 115/23)” – it was informed. “This is another similar case, thanks to which we can say that the Supreme Court’s jurisprudence has been developed. This practice should also translate into the practice of applying the law by common courts, which, before issuing an order for payment in order for payment proceedings, should examine whether the loan or credit agreement underlying the basic relationship does not contain prohibited clauses” – emphasized the Financial Ombudsman Dr. Bohdan Pretkiel.

Main photo source: Elizabeth Krzysztof / Shutterstock.com



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