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1st July 2022
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HomeProperty NewsSwiss Franc loan nullified following ECJ ruling

Swiss Franc loan nullified following ECJ ruling

THE WARSAW District Court on Friday announced a verdict in a test case regarding Swiss Franc mortgage of Mr and Mrs Dziubak. The loan agreement has been nullified.

According to the judge, it was questionable whether or not the Dziubaks had been informed by the bank about the currency exchange risk. The court said that they hadn’t been properly informed about the unpredictability of long-term currency fluctuation.

The Dziubaks borrowed 400,000 zlotys in 2008 but before the case owed about 500,000 zlotys, despite making 10 years of repayments because of the rise in the value of the Swiss franc.

The verdict is likely to encourage more lawsuits.

The European Union’s (EU) top court ruled in October, 2019, in favour of Polish consumers who took out mortgages in Swiss Francs, allowing them to ask Polish courts to convert the loans into the local zloty currency in a blow for lenders.

The verdict was not an outright victory for borrowers, however, because it is up to Polish courts to decide on a case-by-case basis how the contracts are altered.

Attracted by lower interest rates some 700,000 Poles took out mortgages in foreign currencies, mainly in Swiss francs, nearly a decade ago. They are now paying far bigger instalments than they expected after the Swiss franc soared 92 percent against the zloty since the start of the global financial crisis in 2008.

Foreign currency loans total 124 billion zloty ($31 billion), almost one third of all Polish mortgages, and the ECJ verdict encouraged more borrowers to sue for refunds. Currently there are more than 11,000 cases running in the courts.

© TVN S.A. 2020 Wszelkie prawa zastrzezoneProgram



  1. How is it that the justice system in Poland has taken the correct action against the banks, I hear all these negative comments about the people of Cyprus and how corrupt it is, the simple fact is the people of Cyprus are not corrupt it is the institutions, ie the banking institution, 20 years we have been going to Cyprus and it was like second home until the disputes started with the banks.

  2. Surely the banks have to be held accountable for their wrong doings, it seems to me that even though we have made offers to the bank via the lawyers the response is always negative, if they do not wish to repossess the properties why are they not committing to negotiations ,the facts are this we have no evidence to date that the bank has received a offer from us only the word of the lawyers, we have no paperwork showing any correspondence between the lawyers and bank, we are made to feel we are in the wrong, we can not be the only people that feel like this.

  3. We have cases coming up with the BOC,a lawyers firm has been apparently negotiating on our behalf via the help of Hill and Blythe.

    But even whilst negotiations are supposedly being carried out the bank order us with a writ.

    Even though we are still making contributions each month to the loans, our acting lawyers had no idea we where going to be served with these writs.

    We have also stopped receiving statements from the bank on the loans and our personal account that monies it paid in to to pay towards the loans.

    As far as I am concerned we are not getting the answers we want we have been trying to negotiate settlement figure for the last 5 years and all the bank is doing is adding interest to the loans.

    Has anyone any advise surely this is not right.

    Ed: You need to discuss this with your lawyers. As you’re maintaining your loan repayments, there is no reason for the bank to issue you with a writ.

  4. There is an excellent publication available on the European Commission website. Make sure you /your lawyer reads it if you are heading for court. Guidance on the interpretation and application of Council Directive 93/13/EEC on unfair terms in consumer contracts.

    However Cyprus does not respect Court of Justice of the European Union (CJEU) case law. There is no ex officio examination of unfair terms in Cyprus (despite established CJEU case law) and you have to make sure your complaint is sufficiently detailed in your statement of claim, otherwise the judge will just ignore the unfair terms (other than the ones your solicitor flags up). This can be seen in past judgements. The UCPD applies to the main contract and ALL the ancillary contracts, including the contract of assignments which no foreign buyers understand and probably did not see before they were executed. The Cyprus Legal order does not recognise that unfair terms are unfair from the beginning of your contract (provided that post dates the 1996 law), and not from the first judgement in the Cyprus courts that decided a term was unfair or subsequent legislation (despite what your solicitor tells you). It seems there is now a 7-8 year wait from submitting your statement of claim to court of first instance and an average cost of 30,000 euros, which you may never recuperate. The best advice of all is DO NOT BUY PROPERTY IN CYPRUS. It will bring you nothing but grief. It is likely to break you mentally and financially and your life will never be the same again.

    Ed: Cyprus is in trouble with the EU for failing to comply with EU law on unfair commercial practices (Directive 2005/29/EC) and unfair contract terms (Unfair Contract Terms Directive, Council Directive 93/13/EEC). See EC asks Cyprus to comply fully with EU law.

    As far as I am aware, there has been zero progress on these issue.

  5. We have heard that cases are being settled out of court and there are some good deals to be done.

    Ed: Yes – hundreds of those with Swiss Franc loans have settled with the banks though organisations negotiating on their behalf.

  6. Hi Nigel

    Any feedback on the Swiss Franc mortgage cases which are currently going through the Cyprus Courts?

    Ed: Nothing yet. As soon as I have some news I’ll publish an article.

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