Poland: Sale of real estate by electronic auction | Miller Canfield


The law of May 28, 2021 amends the Code of Civil Procedure and certain other laws (Journal of Laws of 2021, article 1090). In addition to the controversial changes to the existing rules for handling cases in civil, criminal and administrative court proceedings and the rules for delivering letters to professional representatives in civil proceedings, it also introduces rules governing the sale of real estate by electronic auction. A substantial part of the provisions of the aforementioned law entered into force on July 3, 2021; however, the provisions regulating electronic auctions of real estate will not take effect until September 19, 2021.

As far as real estate execution is concerned, this is a completely new solution, as the previous regulation only allowed sale by electronic auction for movable property. In general, these sales will be made in a manner similar to the current execution on buildings, with the exceptions provided for by the new legislation. While retaining the specificity of this solution governed by Part Three, Title II, Section VI and the new Chapter 6a of the Code of Civil Procedure (Articles 986¹ to 986¹¹), and taking into account the exclusion of the application of certain provisions , the existing provisions concerning, inter alia, an auction announcement (chapter 4), the auction conditions (chapter 5), the auction (chapter 6) and acceptance (chapter 7) remain applicable to the sale of real estate by electronic auction.

The sale of real estate through electronic auctions will be possible only at the request of a creditor, and if a property is seized to satisfy several claims claimed by different creditors, its sale by electronic auction will be mandatory in the event of presentation of a request by one of the creditors. Thus, a different solution has been adopted than in the case of electronic furniture auctions, where the sale procedure is decided by the creditor at whose request the first seizure took place. The bailiff notifies the debtor, within one week, that he has received a request from a creditor to proceed with the sale of real estate by electronic auction, indicating the real estate or a part of it that is the subject of the request. As at present, the debtor will have the right to indicate an order in which individual properties are to be auctioned if more than one property or parts of a property are to be sold as part of the given enforcement proceeding. It will also be possible to file the request initiating the sale of a property by electronic auction in the event of a request for a re-auction or a second auction.

As in the case of electronic auctions of movable property, the sale of real estate by means of electronic auctions will be done through an TIC system, where the condition of participation in the auction will be the creation of an individual account in the TIC system. . An announcement concerning the sale of real estate by electronic auction is published on the website of the National Council of Judicial Officers at least two weeks before the date of the auction. Under this mode of sale, the obligation to post an advertisement concerning an electronic auction of real estate on a website and a notice board of a court supervising the given execution on real estate (including including in different judicial districts, if the enforcement procedure involves one or more buildings located under the jurisdiction of different jurisdictions) or in the premises of a municipal authority competent for the location of the property, as well as an optional announcement of ‘any other way, including notably in a daily newspaper with wide circulation in the given locality, will no longer apply. The advertisement relating to the sale of real estate by electronic auction includes in particular:

§ information on the property for sale (its location and economic object, the land and mortgage register number and the place where it is kept or an indication of the collection of documents from the land and mortgage register and from a court where said collection is kept);

§ information that the auction is being held by electronic means, as well as the time at which the auction begins and ends;

§ information on the obligation to pay a guarantee and its amount;

§ the time at which the item can be viewed in the two weeks preceding the auction;

§ total amount of the estimate and the starting price.

Unlike the classic real estate enforcement procedure, when announcing the sale of real estate through an electronic auction, a bailiff will not provide the name and surname of a debtor. The time limit for filing a security deposit is also different from traditional enforcement against real estate. In case of sale of real estate by electronic auction, the deposit must be transferred to the relevant bank account no later than 2 working days before the start of the auction, while the deposit date of the deposit is the date on which the bank account of the bailiff is credited (conventionally, a bidder participating in an auction is required to deposit the security deposit no later than the day before the auction). The bailiff notes the fact of depositing the security deposit and providing the data necessary to render an acceptance decision immediately after receipt, admitting the bidder to participate in the auction. The bailiff notifies the interested party of the refusal of admission to the auction via the ICT system. A complaint can be made against the refusal of admission to the auction and concerning the manner of conducting the auction within 3 days from the date of refusal of admission to the auction or from the closing date. of the auction, respectively. Bidders and those who are not admitted to the auction will only be able to file the complaint through the TIC system, while others will benefit as long as they have an account on the system.

An electronic auction of real estate must be scheduled by a bailiff so that it takes place between 9:00 a.m. and 2:00 p.m. on working days. The duration of the auction was also imposed by law, ie 7 days. After the close of an auction (but at the latest within one week), a bailiff sends a report on the progress of the auction, unresolved complaints and the documents necessary to grant a acceptance to the competent court. The decision to accept will be made behind closed doors within one week and will be given to the highest bidder.

The regulations for the application of the newly adopted solutions are still being drawn up, in particular the regulations relating to the modalities of authentication of users of the ICT system, ensuring the accessibility of the system and the security of the use of documents in electronic form .

For one year after the entry into force of the law, it will only be allowed to choose to sell a property by electronic auction if, for technical reasons on the part of a bailiff, this is possible. Consequently, from the date of entry into force of the provisions regulating the solution described, its availability will largely depend on the efficiency of the bailiffs and their technical capacities to make it possible to take advantage of the new provisions.

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