On 23 July 2015 an amendment of the Act on court costs in civil matters enters into force. The amendment gives a further incentive to parties to end litigation by concluding a court settlement. The amendment provides that if the parties conclude a settlement in first instance proceedings, the defendant – who filed and paid for an objection to an order for payment issued in order for payment proceedings – is also entitled to a reimbursement of half the fee.

Previously, if parties concluded a court settlement, the court would reimburse half the fees, but only for the pleading instituting the proceedings in the court instance in which the case was concluded with a settlement. In practice, this meant that if a settlement was concluded in first instance proceedings, half the fee for the statement of claim would be returned to the claimant. In appeal proceedings (complaint proceedings) the party that appealed (or made the complaint) was entitled to a reimbursement of half the fee. However, this regulation did not take into account the specific nature of order for payment proceedings, where the claimant, while filing the statement of claim, was obliged to pay only a quarter of the fee payable for the statement of claim. The remaining ¾ of the fee was paid by the defendant if it made objections to the order for payment. The lack of a reimbursement to the defendant of half the fee for the objections in the case of a settlement resulted from the fact that filing objections to a payment order does not lead to a transfer of the case to a higher court, but causes the case to once again come before the court which issued the challenged order for payment. Objections to an order for payment therefore did not constitute a pleading which instituted proceedings in a given instance.

The amendment to the Act on court costs in civil matters is intended to implement the Constitutional Tribunal’s demand formulated in a decision dated 29 July 2014 (case file no. S 4/14). While acknowledging the constitutionality of the provisions of the Act that govern the reimbursement of court costs in the event of a settlement, the Tribunal also indicated the desirability of supplementing the regulations so that they fully implement the principle that – in the event of an amicable settlement – the originator of the proceedings, i.e. in this case the defendant that paid the fee for the objection to the payment order in the order for payment proceedings, receives part of the fee.

The new regulation may favour a more rapid and conciliatory end to disputes in order for payment proceedings because it gives a financial incentive to both parties to settle.