Offsetting uncertain or indefinite claims

7. 3. 2019

The new Civil Code has brought several significant changes, one of which is the issue of unilateral offsetting. The Civil Code provides that uncertain or indefinite claims may not be offset. However, the explanatory memorandum did not provide any explanation as to which claims should be regarded as uncertain or indefinite.

Partial clarification has been brought by the Supreme Court in one of its recent decisions where it dealt with the issue of the effectiveness of offsetting and raising of this objection within court proceedings. In this case, courts had to deal with the criteria of definiteness and certainty of the claim as a condition for offsettability.

The Supreme Court has concluded that the prohibition of unilateral offsetting of an uncertain or indefinite claim is based in particular on the protection of the creditor from any delays in the proceedings concerning the claim made by the creditor due to the complicated proving of the debtor’s counterclaims. If it can be expected that the objection of offsetting with regard to the difficulty of determining the existence and the amount of the offset claim would unduly extend the proceedings concerning the claim made by an action, it is possible to state the inapplicability of the claim for unilateral offsetting due to uncertainty and indefiniteness.

A claim made for offsetting usually cannot be regarded as uncertain and indefinite if the doubts about its existence are caused by the questionability of the legal qualification, but not by the problematic nature of determining the facts of its establishment. In other words, if it can be doubted whether it is a claim arising from a contract or unjustified enrichment (if the contract was invalid), it does not mean that the claim cannot be used for offsetting. Additionally, if the offset claim arises from the same legal relationship as the claim made by an action, then it is likely that offsetting will be possible.

Therefore, it can be concluded that, in order for the claim to satisfy the criterion of certainty and definiteness, it must be a claim that does not raise any factual doubts as to its establishment (irrespective of its legal qualification). In addition, a “presumption” of compensability (offsettability) is formulated for claims arising from the same legal relationship.

Naturally, the aforementioned criteria apply to unilateral offsetting, i.e. the situation in which the entity itself offsets its claim against the debtor’s claim (e.g. typically offsetting within an invoice based on the supplier’s decision), not to offsetting in the form of agreement where both parties agree on such offsetting. In such a case, the contracting parties may also expressly agree to offset claims which are uncertain or indefinite.

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