Unfair Contract Terms: The Court’s Duty to Review Ex Officio | EU Consumer Law Analysis
Poland’s Supreme Court recently vacated a nineteen-year-old payment order that had been issued without any judicial examination of a loan agreement containing an annualized interest rate of 3,285 percent. The December 4, 2025 judgment (Case No. II NSNc 192/24) reaffirms a foundational principle of European consumer protection law: the review of unfair contract terms constitutes an affirmative judicial obligation arising ex officio, not a discretionary power contingent upon consumer initiative. This Article analyzes the ruling within the broader doctrinal framework established by the Court of Justice of the European Union, examines its constitutional dimensions under Polish law, and considers the jurisprudential implications of adjudicating consumer rights amid ongoing institutional contestation within the Polish judiciary.
I. Introduction
For nearly two decades, a consumer in Poland remained bound by obligations arising from a five-hundred-zloty loan—a sum equivalent to approximately one hundred twenty dollars—subject to daily interest accrual at a rate of nine percent. Annualized, this rate exceeded three thousand two hundred eighty-five percent. The district court that issued a payment order in September 2006, thereby rendering the creditor’s claim judicially enforceable, undertook no examination whatsoever of the contractual provisions undergirding the action. Only following an extraordinary appeal lodged by the Prosecutor General did Poland’s Supreme Court vacate that judgment and remand the matter for reconsideration.
The ruling, published on December 16, 2025, serves as a forceful restatement of a principle that, while well-established in European Union jurisprudence, appears to require periodic reinforcement in domestic judicial practice: a national court possesses not merely the authority but the affirmative obligation to examine, sua sponte, whether contractual terms submitted as the basis for a claim constitute unfair terms within the meaning of Directive 93/13/EEC. A court’s failure to discharge this duty effectively transforms the judicial apparatus into an instrument of enforcement for unconscionable commercial practices—a result fundamentally irreconcilable with the constitutional guarantee of consumer protection enshrined in Article 76 of the Polish Constitution.
II. Factual Background: Five Hundred Zlotys and Two Decades of Compounding Interest
The factual matrix underlying the extraordinary appeal belongs to that category of cases that would appear inconceivable in a jurisdiction purportedly governed by the rule of law. The consumer in question had obtained a loan for a relatively modest principal amount. The agreement, however, stipulated daily interest at nine percent—a rate that, when annualized, exceeds three thousand percent and manifestly transgresses any conceivable standard of contractual fairness or commercial reasonableness.
Upon the borrower’s default, the lender commenced proceedings before the district court seeking a payment order through summary procedures. The court granted the relief requested without conducting any substantive analysis of the contractual provisions at issue. The order became final and, for the ensuing years, served as the executory basis for enforcement proceedings.
Only the Prosecutor General’s intervention succeeded in disrupting this mechanism. The extraordinary appeal alleged that the judgment constituted a manifest violation of law—both domestic and European—by virtue of the court’s complete abdication of its duty to review the contract for potentially unfair terms.
III. The Doctrinal Framework: Ex Officio Review in CJEU Jurisprudence
A. The Océano Foundation
The Supreme Court’s determination aligns with the well-established jurisprudence of the Court of Justice of the European Union, the origins of which may be traced to the seminal judgment in the joined cases of Océano Grupo Editorial and Salvat Editores (C-240/98 to C-244/98), rendered on June 27, 2000.
That case, adjudicated upon a reference from a court in Barcelona, concerned an ostensibly mundane question: whether a national court might, of its own motion, decline to enforce a jurisdiction clause that effectively precluded consumers from mounting a meaningful defense against claims brought by encyclopedia vendors. The Court of Justice answered in the affirmative, articulating in the process a proposition of fundamental significance for the entire architecture of consumer protection within the European Union.
The Court’s reasoning proceeded from an elementary yet consequential observation: the consumer occupies a position of structural inferiority relative to the seller or supplier, both with respect to bargaining power and access to information. Lacking the tools and expertise to draft or negotiate contractual terms, consumers routinely assent to provisions drafted unilaterally by the counterparty, without any genuine capacity to influence their content. Were the efficacy of the protection afforded by Directive 93/13/EEC to depend upon the consumer’s own initiative—upon the consumer affirmatively raising the unfairness of a given clause—the Directive’s objectives would remain substantially unrealized.
Hence the Court’s conclusion that national courts must possess the competence to examine contractual terms ex officio. As the Court observed at paragraph 26: “effective protection of the consumer may be attained only if the national court acknowledges that it has power to evaluate terms of this kind of its own motion”.
B. From Competence to Obligation: The Pannon GSM Refinement
Subsequent jurisprudence extended this principle considerably further. In Pannon GSM (C-243/08), decided on June 4, 2009, the Court clarified that the role of the national court is not confined to a mere power to examine potentially unfair terms—it encompasses an affirmative duty to do so. As paragraph 32 of that judgment states:
[T]he role assigned by Community law to the national court is not limited to a mere power to rule on the possible unfairness of a contractual term, but also consists of the obligation to examine that issue of its own motion, where it has available to it the legal and factual elements necessary for that task.
Significantly, the Court introduced an important qualification concerning consumer autonomy. A court that determines a clause to be unfair must decline to apply it—unless the consumer expressly objects to such non-application. The protective mechanism, in other words, operates automatically in favor of the weaker party but may not be imposed upon a consumer who makes a conscious, informed decision to waive such protection.
C. Extension to Arbitral Proceedings: Mostaza Claro
Earlier still, in Mostaza Claro (C-168/05), decided on October 26, 2006, the Court of Justice extended this standard to proceedings for the annulment of arbitral awards. Even where the consumer failed to raise the unfairness of an arbitration clause during the arbitral proceedings themselves, the court hearing the annulment action bears an obligation to examine the matter sua sponte. The justification, as the Court explained, lies in “the nature and importance of the public interest underlying the protection which the Directive confers on consumers”—a protection that transcends the individual litigant’s private interests and serves the Treaty objectives of the Union.
It merits observation that the Polish Supreme Court in Case II NSNc 192/24 expressly invoked the 2009 Pannon GSM judgment rather than the earlier Océano decision. This circumstance does not diminish the foundational significance of the Barcelona encyclopedia dispute, which inaugurated the jurisprudential line that subsequent judgments have merely confirmed and elaborated.
IV. The Polish Constitutional Dimension
The Supreme Court’s judgment of December 4, 2025, represents the application of these European standards within the framework of Polish constitutional law. Article 76 of the Polish Constitution assumes particular salience, providing that “public authorities shall protect consumers, customers, hirers, and tenants against activities threatening their health, privacy, and safety, as well as against unfair market practices.”
The Supreme Court correctly recognized that a court of general jurisdiction—as an organ of public authority—is directly bound by this constitutional mandate. When a district court issues a payment order predicated upon an agreement containing manifestly usurious terms, without undertaking any review of those terms’ conformity with applicable law, it acts in contravention of the constitutionally imposed duty to protect consumers. The obligation of courts to examine unfair contract terms derives directly from this constitutional norm.
This violation acquires an additional dimension when viewed through the lens of European Union law. Directive 93/13/EEC, as interpreted by the Court of Justice, imposes upon national courts a concrete procedural obligation. Failure to discharge this obligation constitutes not merely an error in the application of domestic law but a breach of the principle of effectiveness (effet utile)—the principle according to which Union law provisions must be applied in a manner that ensures the attainment of the objectives intended by the legislature.
V. Institutional Contestation and the Question of Judicial Legitimacy
A. The Preliminary Observation
It bears noting that the Chamber of Extraordinary Review and Public Affairs—the division of the Supreme Court competent to adjudicate extraordinary appeals — has itself become the subject of a separate institutional controversy concerning the appointment process of its judges. That dispute, which involves competing resolutions within the Supreme Court and touches upon fundamental questions of judicial legitimacy under both Polish constitutional law and European Union law, remains pending. The present analysis focuses exclusively on the substantive consumer-protection holding, which retains its doctrinal significance irrespective of how the institutional question is ultimately determined.
B. A Schmittian Perspective on Judicial Validity
Notwithstanding the ongoing constitutional discourse, it proves instructive to invoke the decisionist perspective of Carl Schmitt, which casts a different light upon the question of judicial validity amid institutional crisis. In the Schmittian optic, a judge’s legitimacy derives not exclusively from the abstract correctness of the appointment procedure (normative legality), but from the fact of acting in the name and by the authority of the political sovereign who guarantees the effectiveness of those decisions. Schmitt, in his critique of liberal normativism, maintained that order (Ordnung) must precede legal order (Rechtsordnung).
A judge in the constitutional sense is, therefore, one whose decisions the state apparatus actually executes. Adoption of a contrary view—one premising the non-existence (sententia non existens) of a judge and his judgments on account of defects in the appointment procedure—would lead directly to anarchy and the dissolution of legal certainty. In circumstances constituting a “state of exception” within the judiciary, it is the actual capacity to resolve disputes (the decision), rather than its procedural genesis, that preserves the state from descending into chaos. Accordingly, so long as the Chamber’s judgments are enforced by state organs, they retain their legal significance, rendering their substantive analysis not merely warranted but necessary.
C. The Specter of Institutional Fragmentation
Should circumstances arise, however, in which state organs succumb to factional division—where one segment of the enforcement apparatus respects the judgments while another denies them legal validity—we enter a phase that Schmitt diagnosed as stasis or latenter Bürgerkrieg (latent civil war). In such a configuration, where a judgment’s effectiveness depends not upon its content but upon the political affiliation of the executing organ, sovereignty itself undergoes decomposition. Law ceases to perform its function of neutralizing social conflicts and becomes merely a weapon in the struggle for dominance. At that point, we no longer confront “anarchy” understood as the absence of authority, but rather a polyarchy of competing decisional centers—a condition that poses an existential threat to transactional certainty and individual security, transcending the bounds of conventional rule-of-law discourse.
D. The Bitter Irony
The bitter irony of the case at hand thus becomes apparent. The state failed the consumer in 2006 when the district court declined to examine the contract for usurious terms. Yet the state arguably fails the consumer again today by offering, as a remedy, judgments whose very existence and judicial provenance may become the subject of the next phase of contestation. Instead of stability and legal certainty, the state proffers chaos—and does so, paradoxically, in the name of restoring the rule of law.
The consumer, caught between institutional combatants, finds that the protection ostensibly guaranteed by Article 76 of the Constitution and Directive 93/13/EEC dissolves into procedural indeterminacy. This is the pathology that Schmitt foresaw: when the guardians of legality themselves become parties to a constitutional Kulturkampf, the individual citizen—the very subject whom the legal order purports to protect—becomes collateral damage in a war fought over the meaning of legitimacy itself.
VI. Practical Implications
The Supreme Court’s judgment carries significance extending well beyond the individual case. It transmits an unambiguous signal to courts of general jurisdiction adjudicating consumer disputes—particularly in summary and order-for-payment proceedings, where the temptation to grant relief mechanically on the basis of facially regular documentation proves especially acute.
In the so-called “Swiss franc mortgage” litigation that has dominated Polish civil jurisprudence for years, the principle of ex officio review of unfair terms has achieved widespread acceptance. The judgment under discussion, however, serves as a reminder that the identical principle applies in every consumer dispute—irrespective of whether the controversy involves a residential mortgage for hundreds of thousands of zlotys or a payday loan for five hundred.
The observation that the duty of review crystallizes when the court “has available to it the legal and factual elements necessary for that task” merits particular emphasis. In practice, this means that where a claimant attaches the underlying contract to the statement of claim—as occurs in virtually every case—the court must analyze its provisions for potential unfairness. The court may not confine itself to a formal verification that the documentation is complete and the arithmetic correct.
VII. Conclusion: The Court as Guardian of Contractual Equilibrium
The European model of consumer protection rests upon the recognition that formal equality of contracting parties—the abstract freedom of each to negotiate terms—does not translate into substantive equality. The consumer, confronted with standardized form contracts promulgated by large commercial enterprises, possesses no realistic capacity to shape the content of the legal relationship. The consumer may accept the proffered terms or decline to contract altogether; tertium non datur.
Within this configuration of forces, the court performs a corrective function. It serves not as a neutral arbiter of disputes between equals but as an active guarantor that the informational and economic advantages enjoyed by the commercial party do not result in the judicial enforcement of terms that egregiously prejudice the interests of the weaker party.
The Supreme Court’s judgment of December 4, 2025, constitutes a reaffirmation of this fundamental truth. For nearly two decades, a consumer bore the consequences of a district court’s failure to discharge its most basic obligation. The extraordinary appeal has now rectified that error—yet the question remains how many analogous cases continue to await discovery in the archives of Polish courts.
Case Information: Case No. II NSNc 192/24 was the subject of an extraordinary appeal filed by the Prosecutor General. The Supreme Court’s judgment of December 4, 2025, was published on December 16, 2025.
Author: Robert Nogacki, Legal Counsel (radca prawny), Kancelaria Prawna Skarbiec, Warsaw.
See also: The Fine Print: What to Know Before You Sign | Antitrust / Competition Law in Poland
Founder and Managing Partner of Skarbiec Law Firm, recognized by Dziennik Gazeta Prawna as one of the best tax advisory firms in Poland (2023, 2024). Legal advisor with 19 years of experience, serving Forbes-listed entrepreneurs and innovative start-ups. One of the most frequently quoted experts on commercial and tax law in the Polish media, regularly publishing in Rzeczpospolita, Gazeta Wyborcza, and Dziennik Gazeta Prawna. Author of the publication “AI Decoding Satoshi Nakamoto. Artificial Intelligence on the Trail of Bitcoin’s Creator” and co-author of the award-winning book “Bezpieczeństwo współczesnej firmy” (Security of a Modern Company). LinkedIn profile: 18 500 followers, 4 million views per year. Awards: 4-time winner of the European Medal, Golden Statuette of the Polish Business Leader, title of “International Tax Planning Law Firm of the Year in Poland.” He specializes in strategic legal consulting, tax planning, and crisis management for business.
