The Polish Supreme Court dealt with two issues arising out of setting aside proceedings. First, the question of the relationship between the decision of the court in setting aside proceedings and its impact on the arbitration commenced after the setting aside of the award. Second, the issue of whether the certainty of the law embodied in the statute of limitations may constitute the basic rules of law which should be protected under the public policy objections in setting aside proceedings.
The case concerned arbitral proceedings in which an arbitral award was set aside on the basis of a party being unable to present its case. This was found to have occurred due to the wrong address being used in the correspondence with the party during the arbitral proceedings. The court, when setting aside the award, found obiter dicta that the wrong address was also present on the notice of arbitration. After the setting aside proceedings ended, new arbitration proceedings were commenced, and this time the same party once again prevailed in the proceedings. The losing party once again filed for the setting aside of the award, this time alleging that the tribunal had not observed the decision of the court rendered during the first setting aside proceedings and, moreover, this led the tribunal to overlook the limitation periods included in Polish law. When hearing the case, the court of first instance agreed with these objections. However, the appellate court changed the ruling and dismissed the case. The Supreme Court agreed with the appellate court, dismissing the cassation appeal.
The Supreme Court found that the impact of the court’s decision rendered in proceedings for the setting aside of an arbitral award on new arbitration proceedings (commenced due to the setting aside) was limited. The Supreme Court stated that, while it may seem that setting aside proceedings are similar to proceedings in the second instance, this impression is misleading. This is because after setting aside an arbitral award, arbitration proceedings are not recommenced. They are commenced anew, as new proceedings. This is why an arbitral tribunal hearing a case after setting aside proceedings is nonetheless autonomous when it comes to rendering a decision. It is bound by the decision rendered in the setting aside of the award to the same extent that any other tribunal or court would be bound.
The Supreme Court also considered whether the regulations pertaining to limitation periods could constitute a basis for a successful public policy objection. The Supreme Court in this respect confirmed that the question of the merits of a case cannot be reexamined by the courts in post-arbitration proceedings. The court decided that the mere improper interpretation of the law by an arbitral tribunal may not constitute the basis for the setting aside of an arbitral award. This also applied to laws which have the aim of maintaining the stability of legal transactions (such as the rules on limitation periods).
This decision confirms that the courts in Poland observe the autonomy of arbitral proceedings, even in cases of setting aside arbitral awards. Moreover, by confirming that the public policy objection cannot be interpreted broadly, the Supreme Court confirmed that when parties agree to arbitrate their disputes, they may expect that there will be limited grounds on which they may challenge the award and should be ready to accept these consequences of agreeing to arbitration.