On October 19, the Supreme Court issued a judgment stating that Swiss franc contracts are valid and that we should use the average NBP exchange rate instead of the bank’s own rates. Recently, a justification appeared on the Supreme Court’s website (II CSKP 1627/22). This judgment stands out from the main position presented by the Supreme Court in franc disputes. Did the controversial ruling have an effect on the decisions of common courts? Will it turn the seemingly established line of jurisprudence on franc matters upside down?
Developed line of jurisprudence
In 2012, the Court of Competition and Consumer Protection found conversion clauses in Swiss franc contracts prohibited. Enthusiasm waned when it turned out that the courts would not soon reach an agreement on what to do next with the flawed contract. First of all, the question was asked whether the entire provision should be deleted from the contract or whether the contract could be “healed” by including the average NBP exchange rate.
Only after 7 years, on October 3, 2019, the CJEU finally stated (as it seemed) that the abusive provision should not be modified, but deleted from the contract in its entirety (case C-260/18 in the case of Mr. and Mrs. Dziubak). Later, national jurisprudence reached a consensus on the invalidity of Swiss franc loan agreements without conversion clauses.