The Arbitration Agreement as a Procedural Defense: Strategic Considerations Under Polish Civil Procedure

The Arbitration Clause Is Not an Automatic Shield Against State Courts

An arbitration clause in your contract is not an automatic shield against state court proceedings. It is a weapon you must consciously draw—and at the right moment. The court will not examine ex officio whether your agreement contains an arbitration agreement. If you fail to raise the objection, the case will proceed before the state court as if the arbitration clause never existed.

The Arbitration Clause as Tactical Protection—Not a Guarantee

Polish civil procedure treats the arbitration clause (arbitration agreement) as a so-called negative procedural prerequisite of a relative nature. In practice, this means that:

• the state court will not dismiss the claim on its own initiative, even if it sees the arbitration clause in the attached contract
• the defendant must actively raise the objection of the arbitration clause’s existence
• if they fail to do so (or do so too late)—the state court will hear the case on its merits

This legal construction has deep justification: parties who agreed to arbitration may later change their minds. The defendant’s failure to raise the objection is interpreted as implied consent to state court jurisdiction. This principle corresponds with broader rules of commercial law concerning party autonomy in shaping dispute resolution mechanisms.

Strategic Choice: State Court or Arbitration?

Before automatically invoking the arbitration clause, pause and analyze the situation. The mere existence of an arbitration agreement does not mean that arbitration is more advantageous for you in a particular dispute.

When the Arbitration Clause and Arbitration May Be the Better Choice

Confidentiality of proceedings – arbitration hearings are not public, and the award does not enter public case law databases. For companies protecting their reputation or safeguarding trade secrets and intellectual property, this argument is invaluable.

Speed of resolution – arbitration proceedings often conclude within several months, while a case before a state court (with appeal) may drag on for years. This is particularly important when you are pursuing debt collection and need to recover funds quickly.

Arbitrator specialization – you can select arbitrators with experience in the industry that is the subject of the dispute. A state court judge may not understand the specifics of FIDIC contracts, cryptocurrency trading, derivative instruments, or project financing.

Procedural flexibility – parties can agree on the language of proceedings, venue of hearings, and evidentiary rules. In international disputes governed by international private law, this is often the decisive factor.

When State Court May Prove More Advantageous

Costs of proceedings – arbitration can be expensive. Registration fees, arbitrator compensation, and administrative costs of the arbitral institution may far exceed court filing fees. In disputes involving smaller amounts, the difference is particularly acute—traditional court debt collection may then be worth considering.

Interim measures and enforcement – although an arbitral tribunal can issue interim measures, their enforcement requires involvement of state courts. For urgent protective measures, such as when there is a risk of debtor actions to the detriment of creditors, this creates additional delay.

Two-instance review – you can appeal a state court judgment, resulting in a fresh examination of the case. A motion to set aside an arbitral award is an entirely different remedy—the court examines only strictly defined formal prerequisites, not factual findings or interpretation of substantive law.

Precedent and predictability – state court jurisprudence is published, allowing you to anticipate the line of rulings. Arbitral awards are generally confidential, making it difficult to predict outcomes. This is particularly important in cases concerning board member liability or other matters with established case law.

Tactical Decision: Invoke the Arbitration Clause or Not?

You receive a statement of claim, and your contract contains an arbitration clause. You face a strategic choice:

Invoke the arbitration clause if:

• you expected arbitration and still consider it more advantageous
• you want to gain time (the procedure for examining the objection extends proceedings)
• confidentiality of proceedings is your priority
• the dispute concerns matters requiring specialized knowledge

Consider waiving the arbitration clause if:

• arbitration costs would be disproportionately high relative to the dispute value
• you value two-instance review and broad grounds for challenging the judgment
• you need quick and effective interim protection
• you prefer the predictability of state court jurisprudence

Remember: not raising the objection is also a decision—a conscious waiver of arbitration in favor of state court litigation. It is not a failure or mistake, provided it results from deliberate calculation.

Deadline for Invoking the Arbitration Clause—The Moment That Decides Everything

The objection based on the arbitration clause must be raised before entering into the dispute on the merits (Article 1165 § 1 of the Polish Code of Civil Procedure). Missing this deadline results in definitive preclusion—you lose the ability to invoke the arbitration agreement throughout the remainder of the proceedings.

What Does “Entering into the Dispute on the Merits” Mean?

You enter into the dispute on the merits when you take a substantive position on the claimant’s demand:

• you challenge the validity of the claim
• you raise the defense of performance
• you invoke the statute of limitations
• you indicate set-off of claims
• you address the amount of the claimed sum

Raising purely procedural objections does not constitute entering into the dispute: objections to court jurisdiction, formal defects in the statement of claim, or precisely—the objection of the arbitration agreement.

Practical Procedural Moments

Key tip: In a single procedural brief, you may combine the objection of the arbitration agreement with substantive arguments. The order of paragraphs does not matter—what counts is that the objection was raised in the same brief, before actually entering into the dispute at the hearing.

How to Properly Formulate an Objection Based on the Arbitration Clause

Effective invocation of the arbitration clause requires meeting certain formal and substantive requirements.

Essential Elements

Identification of the arbitration clause – you must precisely specify in which document the arbitration agreement is contained (main contract, regulations, general terms and conditions) and quote its content or attach a copy.

Presentation of the original or certified copy – the court may demand presentation of the document containing the agreement. Practice shows that attaching a certified copy to the procedural brief eliminates additional summonses.

Demonstration that the dispute falls within the scope of the agreement – if the arbitration clause covers only certain categories of disputes, you must justify that the claimant’s claim belongs to that category.

When the Arbitration Clause Will Not Block Court Proceedings

The court will dismiss the objection based on the arbitration clause if any of the prerequisites specified in Article 1165 § 2 of the Polish Code of Civil Procedure exists. The arbitration agreement may prove invalid, ineffective, unenforceable, or may have lost its binding force. Moreover, the objection will be moot if the arbitral tribunal previously ruled on its lack of jurisdiction.

Scope of Court Examination Upon the Arbitration Clause Objection

Invoking the arbitration clause triggers the court’s obligation to comprehensively verify the arbitration agreement. As the Supreme Court emphasized, a state court dismissing a claim “must be certain that the agreement is valid, effective, and enforceable.”

What Does the Court Examine?

The scope of the court’s cognition when examining the objection includes:

• the fact of existence of an arbitration clause submitting dispute resolution to an arbitral tribunal
• subject matter scope – whether the claimant’s claim falls within the agreement’s scope
• personal scope – whether the parties to the proceedings are bound by the arbitration clause
• validity of the agreement – whether formal requirements were met, whether parties had capacity to conclude it
• effectiveness of the agreement – whether grounds for ineffectiveness exist
• enforceability of the agreement – whether a specific arbitral tribunal can be identified

The Supreme Court confirmed that “the necessity to examine this objection at the stage preceding the parties’ entry into the dispute on the merits cannot be treated as the inadmissibility of addressing any substantive law issues” (Supreme Court decision of November 7, 2013, V CSK 545/12). If determining whether the claim belongs to the agreement’s scope requires examining the contract’s content and the parties’ common intent—the court cannot avoid making these findings.

What Happens After Invoking the Arbitration Clause

Incidental Proceedings

The court may examine the objection in camera or limit the hearing exclusively to the issue of the arbitration clause’s effectiveness (Article 220 of the Polish Code of Civil Procedure). In practice, an exchange of procedural briefs concerning the objection’s validity is often ordered.

Possible Rulings

Acceptance of the objection – the court issues a ruling dismissing the claim. This ruling may be appealed (Article 394 § 1 of the Polish Code of Civil Procedure), and subsequently a cassation appeal to the Supreme Court is available.

Rejection of the objection – the court issues a ruling that may also be appealed (Article 394 § 1 point 3 of the Polish Code of Civil Procedure). The court may stay further proceedings until the ruling becomes final (Article 222 of the Polish Code of Civil Procedure).

Possibility of Withdrawing the Objection

The objection based on the arbitration clause may be withdrawn until the ruling on its validity becomes final—including during appeal proceedings (Supreme Court resolution of June 4, 2009, III CZP 29/09). This provides additional tactical flexibility.

2023 Amendment: Concluding an Arbitration Clause During Pending Proceedings

Since July 1, 2023, Article 1161¹ of the Polish Code of Civil Procedure has been in force, introducing a significant change: parties may conclude an arbitration agreement even when proceedings before a state court are already pending—until the case is finally resolved.

Mechanism of Operation

If parties decide to conclude an arbitration clause during the trial, the state court will discontinue proceedings upon their joint motion. This solution was previously subject to doctrinal controversy—the legislature has unequivocally confirmed its admissibility.

Consequence: Ex Officio Dismissal

Under the new Article 1165 § 1¹ of the Polish Code of Civil Procedure, if parties concluded an arbitration clause during earlier proceedings (which were subsequently discontinued), and one of them again files a claim with a state court in the same matter—the court will dismiss the claim ex officio, without the need to raise an objection.

This is an exception to the principle of the relative nature of the arbitration agreement prerequisite. The legislature intended to “mobilize parties to consider the decision to submit the dispute to arbitral tribunal resolution” (explanatory memorandum to the bill, parliamentary paper no. 2650).

Arbitration Clause Designating a Foreign Arbitral Tribunal

Article 1165 § 4 of the Polish Code of Civil Procedure provides that all discussed rules also apply when the arbitration clause designates a foreign arbitral tribunal or when the place of arbitration proceedings has not been specified.

You may therefore effectively raise before a Polish court the objection of an arbitration agreement for ICC arbitration in Paris, LCIA in London, or SCC in Stockholm. The Polish court will assess the validity and effectiveness of such an agreement under the applicable law (usually the law of the contract or the law of the arbitration seat). These issues gain particular significance in cross-border M&A transactions.

Strategic Aspect: Designing Arbitration Clauses

The discussed issues demonstrate how important it is to consciously design arbitration clauses at the stage of drafting and negotiating contracts.

Elements of a Well-Constructed Arbitration Clause

Precise definition of scope – does the arbitration clause cover all disputes related to the contract, or only selected categories? Too narrow a scope may leave some claims outside arbitration.

Unambiguous designation of the arbitral institution – providing the full name and seat eliminates the risk of the arbitration agreement being unenforceable.

Determination of the number of arbitrators – one arbitrator means lower costs, three means greater certainty of correct resolution.

Language of proceedings – important in international relations.

Applicable law for the contract and for the arbitration clause – these may be different legal systems. In transactions involving holding companies or international structures, this issue requires particular attention.

Conclusion: The Arbitration Clause as a Conscious Choice

Invoking the arbitration clause is not an automatic defensive reaction, but a conscious procedural decision requiring analysis of the specific situation.

Key Practical Conclusions:

• The court does not examine the existence of the arbitration clause ex officio—you must raise the objection yourself
• The deadline is absolute: before entering into the dispute on the merits
• Not raising the objection may be a conscious tactic, not a mistake
• Before deciding, consider all pros and cons of arbitration in the specific dispute
• The objection may be withdrawn until the ruling on its validity becomes final
• Since 2023, it is possible to conclude an arbitration clause even during pending court proceedings

An arbitration clause in a contract is potential, not certainty. Its effectiveness depends on your procedural awareness and ability to use it at the right moment.

Do you need support in court or arbitration proceedings? Contact us—we offer comprehensive legal services for businesses and representation in court proceedings.

Legal status: January 2026

Robert Nogacki

Robert Nogacki is a Polish attorney at law (radca prawny), the founder and managing partner of Kancelaria Prawna Skarbiec (Skarbiec Law Firm), which has operated continuously since 2006.

The law is equal for everyone, but the parties rarely are: on one side stands an organization with time, money, and lawyers, on the other a person with one business, one nest egg, and one life.

Clients rarely come to him with a legal problem. They come with a problem that also has a legal side: an audit that began with a single invoice, money entrusted to someone who has disappeared, a company that has to be passed on before it is too late. Most such matters are decided long before the first letter is written, in decisions made without asking and in deadlines nobody remembered. So he begins by asking how the client got here, not what the client should have done.

He advises entrepreneurs and families from more than a dozen countries, including those whose accounts the tax office has just seized and who do not know what to do tomorrow morning. He defends them in tax audits, customs and fiscal inspections, disputes with the tax authorities, and criminal tax proceedings. He represents victims of investment fraud and Ponzi schemes. He helps families set up family foundations and plan succession, so that a life’s work outlasts a single generation.

Not every case can be won. Every case can be run so that the client knows where they stand. Since 2006 he has represented the victims in the WGI case (Warszawska Grupa Inwestycyjna, the Warsaw Investment Group), one of the longest criminal cases in the history of the Polish financial market, because some things must not be left half finished, even when they take two decades. In the case of the collapsed cryptocurrency exchange Zonda (Zondacrypto, operated by BB Trade Estonia OÜ), he represents several hundred victims in the criminal investigation conducted by Poland’s National Prosecutor’s Office and in the Estonian bankruptcy proceedings.

Kancelaria Prawna Skarbiec is listed in the rankings of Poland’s largest tax advisory firms published by Dziennik Gazeta Prawna and Rzeczpospolita, and it is a four-time recipient (2015 to 2018) of the European Medal awarded by the Business Centre Club and the European Economic and Social Committee. Robert Nogacki publishes regularly, in the press and on the firm’s website, for people who have a problem rather than a law degree, because a legal opinion the client cannot understand protects only the lawyer.

He believes that the best legal advice is the kind that means the client never has to appear in court.