Equipment Paid for but Still at a Polish Supplier’s Warehouse: Seven Safekeeping Decisions

Equipment Paid for but Still at a Polish Supplier’s Warehouse: Seven Safekeeping Decisions

You have paid 80% of the price for more than a dozen pieces of equipment. They are still at the supplier’s warehouse and may remain there for another year. The supplier writes: “Our third-party liability policy fully covers property stored at our premises. No other insurance is needed.”

That may sound reassuring. It does not answer the question you need answered. Third-party liability insurance responds to claims against the supplier; it is not a property policy insuring equipment owned by someone else. If the warehouse burns down, you are neither the policyholder nor an insured party under that liability policy.

This is the first of seven issues to resolve before sending the supplier a draft safekeeping agreement.

In this article, a warehouse sale means an arrangement in which equipment is paid for and ownership passes in stages up a project chain—supplier → subcontractor → general contractor → project client—while the equipment remains physically with the supplier. It may stay there for a year or longer, with payment made well before delivery to the construction site. Without a separate agreement addressing custody, insurance, access, and identification, a supplier’s assurance leaves critical questions unanswered.

The seven decisions below are organized around a practical question: what happens if the agreement does not say? A 15-point checklist and a document-control precaution follow.

Key Polish-law and project terms

1. Set a safekeeping end date—and address early collection

An indefinite-term safekeeping agreement gives the custodian a right to terminate it. Equipment awaiting installation could then have to be moved and stored elsewhere at your expense.

The draft should:

1. Specify an end date later than the latest relevant deadline under your subcontract. Take that date from the project schedule, not from the safekeeping draft in isolation.
2. Use a fixed term to remove the custodian’s termination right associated with an indefinite arrangement.
3. Allow the depositor to extend the term unilaterally, without changing the other terms. Project schedules move; the extension mechanism should give the party awaiting installation the necessary flexibility.
4. Expressly exclude Article 844 § 2 of the Civil Code, which concerns the custodian’s right to demand collection before the agreed date. This is a significant negotiating point.

If you leave this unresolved: the supplier may demand collection before the site is ready. You could face emergency transport, additional storage charges, and damage risks from unnecessary handling.

2. Decide what signing the safekeeping acceptance report means for payment

The safekeeping acceptance report does more than record a handover. It identifies the equipment—type, quantity, factory or serial numbers, storage location, and unit value—and marks the start of the safekeeping arrangement. It may also become the event that triggers payment.

That matters when the payment schedules in the project documents differ:

Signing a report confirming that equipment has been accepted for safekeeping is not necessarily “delivery” under the supply agreement—unless the documents say that it is.

Before anyone signs the report:

1. Hold a 30-minute discussion with the person responsible for contract payments.
2. Resolve in one sentence in the agreement whether signing the report constitutes delivery of the relevant components under the supply agreement.
3. Put the supply-agreement and main-agreement payment milestones side by side to expose any mismatch.
4. Compile identifying information for equipment at each location: type and quantity, factory or serial numbers, exact storage location, and unit value.
5. Agree in writing how the general contractor and contract engineer will participate in acceptance and inventory checks.

If you leave this unresolved: the supplier may sign the report and demand 70% of the price. You may have no clear contractual basis either to confirm or reject that demand. A question that should have been settled by the payment team becomes a legal dispute.

Contact us if you need to align an acceptance report with the payment milestones across your project contracts.

3. Require property insurance for the account of another—not just the supplier’s liability policy

A common supplier response is that its third-party liability insurance “fully covers” property at its premises. The distinction is central:

1. Third-party liability insurance protects against third-party claims made against the supplier; it is not the same as insurance of the equipment itself.
2. The equipment’s owner—whether the subcontractor, general contractor, or project client—is not made a policyholder or insured party merely because the supplier has liability cover.
3. On the arrangement described here, a warehouse fire would not result in the supplier’s liability insurer paying property-insurance compensation directly to the equipment owner.

The agreement should instead require the custodian to obtain and maintain, at its own cost, property insurance for the account of another under Article 808 of the Civil Code. Article 808 § 1 (consolidated text, Journal of Laws 2024, item 1061) permits an insured group that is not identified by individual name. Article 808 § 3 gives an insured party the right to claim the insurance benefit directly from the insurer.

The insurance provisions should also:

• Identify the insured group as the subcontractor, general contractor, and project client, according to their respective property interests.
• Include a clause maintaining continuity of the insured interest when ownership changes. Article 808 does not, by itself, establish automatic continuity of cover through successive ownership transfers.
• Allocate insurance proceeds to whoever owns the equipment at the time of the insured event, prevent double recovery, and specify that proceeds are to be used to repair or replace the equipment.
• Record in writing that the supplier’s liability policy is not accepted as sufficient property insurance.

Who ultimately bears the premium? Although the proposed obligation places the policy cost on the custodian, the supplier may seek to recover it through the equipment price. Settle that in negotiations, not after the policy is needed.

4. Approve and identify each storage location

Suppose the contract engineer has approved one warehouse address, but the supplier adds a second address to the draft. Do not treat the new address as approved simply because it appears in the document.

1. Delete any storage location lacking written approval from both the contract engineer and the general contractor.
2. Remove supplier-added addresses from the draft and seek approval through a separate process rather than negotiating their inclusion in the agreement.
3. Require storage in a designated area, separated from the custodian’s goods and third-party goods, on a fenced site and in accordance with the manufacturer’s operating and maintenance documentation.
4. Agree the wording of identification signs with the engineer as part of warehouse approval, and obtain an express email confirming that the signage is sufficient.

Why identification matters if the custodian enters bankruptcy

Article 70 of the Polish Bankruptcy Law (consolidated text, Journal of Laws 2026, item 913) provides for property that does not belong to the bankrupt party to be excluded from the bankruptcy estate. The Court of Appeal in Poznań (I AGa 278/22, 21 April 2023) confirms that Article 70 addresses assets included in an estate despite not being owned by the bankrupt party.

Exclusion is not automatic. The protective effect depends on several elements working together: ownership must already have passed; the particular units must be identifiable through numbers, segregation, and signs; they must not be mixed with the custodian’s property; and the contracts and warehouse records must match what is actually on site.

If you leave this unresolved: following enforcement action against the supplier, you may struggle to show which units are yours. A warehouse containing the supplier’s goods and other customers’ goods, without segregation or signs, leaves you with a serious evidence problem.

5. Define the exact point where transport risk ends and unloading risk begins

The proposed allocation may say that transport from the warehouse to the site is at the custodian’s cost and risk, while unloading is the depositor’s responsibility. That still leaves a gap: when does risk pass?

Use a sentence that chooses the operative point—for example, vehicle arrival, lifting the load from the truck bed, or placing it on the ground. The choice must fit the agreed logistics. Also state:

1. Who secures the load during unloading.
2. Whether the custodian remains responsible for loss, destruction, damage, and theft until release at that defined point or until another specified moment.

If you leave this unresolved: damage during unloading may turn into a dispute over whose risk had begun. The parties may end up litigating a boundary that could have been written into one sentence.

6. Address lien, retention, and every transfer of ownership

Under the arrangement described, the supplier may still hold equipment after ownership has moved up the contractual chain. Article 461 of the Civil Code concerns a right of retention. Without an express waiver, the supplier may seek to withhold release while citing an unpaid invoice—even one from another order.

The draft should:

1. Include the custodian’s waiver of lien and right of retention, including the right addressed in Article 461.
2. Prohibit making release of the equipment conditional on payment.
3. Plan notices to the party holding the equipment under Article 350 of the Civil Code for each ownership transfer. Article 349 is relevant to transfer without physical handover, but the custodian needs to know who the new owner is at each stage.
4. Exclude retention-of-title wording from both the supply agreement and the supplier’s commercial documents. Otherwise, the supplier may argue that ownership never transferred.

If you leave this unresolved: the supplier may refuse release, work on site may stop, and the main contract schedule may fail. Delay penalties under that contract could substantially exceed the invoice in dispute.

7. Make three deliberate choices about contractual penalties

A proposed penalty might be around PLN 1,000 per day of delayed release, per item held in safekeeping. Applied to more than a dozen equipment sets, the total can rise rapidly.

Article 484 § 2 of the Civil Code (consolidated text, Journal of Laws 2024, item 1061) provides two independent grounds for a court to reduce a contractual penalty: substantial performance of the obligation and a grossly excessive penalty. The Supreme Court (II CSKP 2107/22) confirms there is no statutory percentage or monetary threshold. With a daily penalty, courts assess the total accrued amount, not only the one-day rate.

Decide the following before circulating the draft:

There may be a further enforcement gap. A draft that penalizes only delayed release imposes no direct contractual penalty for failure to maintain insurance, denial of inspection access, or breach of storage conditions. Include sanctions for those obligations too.

A 15-point checklist before the draft goes to the supplier

Assign an owner to each item. The suggested roles below keep legal drafting, project coordination, payment administration, and insurance review connected.

Before sending the draft: remove internal negotiation comments

Internal comments can reveal where you think your position is weak and where you expect resistance. Sending those comments to the supplier may undermine negotiations on all seven issues.

Make document control a required step:

1. Keep the internally commented draft and the clean external draft as separate files.
2. Resolve comments with the internal business client.
3. Remove the comments from the external file.
4. Check the file before sending it.
5. Repeat that check every time a draft goes to the counterparty.

Does the arrangement work outside construction?

The combination of safekeeping, individual identification, and insurance for the account of another is not limited to infrastructure equipment. Article 853 § 1 of the Civil Code, addressing a warehousing agreement, covers specified movable property rather than restricting the arrangement to one industry (consolidated text, Journal of Laws 2024, item 1061).

In each setting, the operator’s insurance and its contractual liability are separate mechanisms; one does not replace the other. The seven decisions remain relevant, with modifications appropriate to the goods and operating model.

How we can help with a Polish safekeeping arrangement

A safekeeping agreement linked to a warehouse sale looks straightforward, but it depends on the wider contractual chain. The general contractor, project client, and contract engineer may all need the arrangement to work even though they are not parties to the safekeeping agreement. Each of the seven decisions connects legal drafting with payments and project logistics.

We can assist with:

1. Reviewing the supplier’s template: an assessment of the seven issues and the decisions needed before a revised draft is sent.
2. Preparing the document set: a safekeeping agreement, an acceptance-report annex, and a statement for the project client, aligned with the order of precedence among the main agreement, supply agreement, safekeeping agreement, reports, and the supplier’s commercial documents.
3. Supporting negotiations through signature: coordinating with the contract engineer and reconciling the safekeeping terms with the supply agreement and main contract.

If you are paying for equipment that will remain with a Polish supplier and do not yet have a safekeeping agreement, contact us.

Frequently asked questions

Is a supplier’s statement enough instead of a separate agreement?

A statement that the supplier is responsible for equipment until it leaves for the site does not settle property insurance, inspection access, identification of particular units, transfer of risk, or waiver of retention rights. Those omissions matter if the warehouse burns down, the supplier enters bankruptcy, or release is disputed. The separate agreement should address the seven decisions above.

The supplier says its liability policy covers goods at its premises. What should I say?

Respond in writing that third-party liability insurance is not property insurance for the account of another under Article 808 of the Civil Code. Ask for a property policy identifying the subcontractor, general contractor, and project client as insured parties according to their interests. The question is which protection mechanism applies—not whether the supplier has bought some insurance.

What if the supplier enters bankruptcy while holding my equipment?

Article 70 of the Bankruptcy Law provides a route to exclude property that does not belong to the bankrupt party from its estate, but the result is not automatic. You need proof that ownership passed, precise identification and physical segregation of the units, no commingling, and records matching what is actually in the warehouse. An acceptance report with identifying data and effective segregation materially strengthens that position.

Is a penalty of PLN 1,000 per day per item too high? Won’t a court reduce it?

There is no market benchmark for that rate in the approved analysis. The accumulated amount matters in relation to the equipment’s value and actual loss. A penalty approaching the value of delayed performance may be considered grossly excessive, and an uncapped total reinforces that concern. Decide the daily rate, calculation unit, aggregate cap, and any express right to supplementary damages in advance rather than relying on a later reduction.

Can this approach cover IT equipment or fulfillment stock?

Yes, with adjustments. Serial-numbered IT equipment is generally easier to identify individually. Bulk stock requires particular care to prevent commingling with other customers’ goods. The operator’s insurance still does not replace its contractual liability.

How long does agreement take, and must deliveries stop?

Timing depends on the unresolved issues and the supplier’s willingness to negotiate. Resolving the seven points usually involves several meetings and two or three rounds of drafts. Work can proceed alongside deliveries, provided the safekeeping acceptance report is not signed before its effect on payment has been resolved.