Recovering Debt From a Former Franchise Partner in Poland—Without Creating New Liabilities

Recovering Debt From a Former Franchise Partner in Poland—Without Creating New Liabilities

A former partner closes an outlet while owing your network money. You have an acknowledged balance, potential contractual penalties, staffing costs, customer refunds, and a blank promissory note. It may be tempting to add every item together and demand the maximum.

That approach can undermine otherwise valid claims. A penalty charged separately for every customer served outside the network’s system may be reduced by a Polish court, potentially affecting the penalty claim as a whole. Meanwhile, customers of the closed outlet are contacting head office. An inaccurate customer-service response could create a liability risk greater than the partner’s debt.

For a business operating a franchise, agency, or partner network in Poland, the task has two parts: build a defensible claim against the former partner, and communicate with customers without suggesting that the network assumed the partner’s obligations.

Polish legal concepts you need to know

• Contractual penalty (kara umowna). An agreed amount payable for failure to perform, or improper performance of, a non-monetary obligation. Articles 483–484 of the Polish Civil Code govern these penalties. They cannot be charged for failure to pay money; for an unpaid monetary obligation, the claim is for the principal and applicable interest.
• Judicial reduction of a contractual penalty (miarkowanie). Under Article 484 § 2 of the Civil Code, a court may reduce a penalty that is grossly excessive or where the obligation has been substantially performed. The debtor must request the reduction; the court does not apply it on its own initiative.
• Blank promissory note (weksel in blanco). A promissory note issued with an element, such as the amount, left incomplete. The creditor is authorized to complete it under a separate declaration. It secures an underlying claim rather than creating an additional, independent debt.
• Promissory note declaration (deklaracja wekslowa). The agreement specifying when the creditor may complete the note and up to what amount. Its scope limits what can be pursued using the note.
• Order-for-payment proceedings (postępowanie nakazowe). A Polish procedure in which a court may issue an order for payment on the basis of a document, such as a promissory note, without first holding a hearing. It can be faster and cheaper than ordinary litigation, but the formal requirements of Article 485 § 2 of the Polish Code of Civil Procedure must be met.
• Franchise agreement. Franchise remains an innominate contract in Poland: it is not governed by a dedicated statutory contract type, but is based on freedom of contract under Article 353¹ of the Civil Code. The franchisee operates in its own name, on its own account, and at its own risk while using the franchisor’s brand and know-how. The draft Civil Code amendment approved by the Council of Ministers in December 2023 had not been enacted as of the article’s publication (Polish government information).

Five rules for settling accounts with a former franchisee

1. Separate the claims by legal basis

The former partner’s debt is not one undifferentiated amount. Each component needs its own legal basis, evidence, and route to recovery.

Break the proposed demand into these four categories before sending it. Assign each item to its basis and supporting documents. If the calculation is inconsistent, a court may question the credibility of the entire claim, including items that were correctly calculated.

2. Treat the business spreadsheet as evidence to check—not the final demand

An operations or finance spreadsheet is a starting point, not a ready-to-file calculation.

In the matter analyzed for the source article, the spreadsheet incorrectly totaled 13 individually listed customer refunds. The correct total was more than twice the stated amount. Using the incorrect total in a demand would have left part of the claim out; discovering the error in court would have cast doubt on the whole schedule.

Before issuing a demand:

1. Recalculate every total, item by item, independently of the spreadsheet.
2. Check whether each amount is already included in the balance acknowledged under an agreement. Claiming the same item twice damages credibility.
3. Set a cut-off date. State the amounts established when the demand is prepared; add later items in a subsequent letter or the court claim.

3. Charge for the documented practice, not automatically for each customer

Suppose the partner accepted payments through a private terminal outside the network’s system. Charging a separate contractual penalty for every affected customer can multiply the demand far beyond the loss and invite a request to reduce it under Article 484 § 2 of the Civil Code.

That reduction may affect the contractual-penalty claim as a whole, including a portion calculated correctly. In the case identified in the source as I AGa 155/18, the court reduced the penalty to 50% of the amount charged. There is no statutory percentage threshold; a court may reduce it further.

Check three additional risks:

• Penalizing the same event twice. “Failure to record a visit in the system” and “sale outside the system” may describe the same conduct. Applying two clauses to that one event invites an objection that it has been penalized twice.
• No link to a penalty clause. An obligation such as maintaining accurate customer records, without a direct reference to a contractual penalty, does not itself support charging that penalty. An additional trigger—such as obstructing an inspection or breaching a data processing agreement—would be needed.
• Penalizing non-payment. Missed payment installments are monetary obligations. Pursue the principal and statutory interest for late payment, not a contractual penalty.

In the matter analyzed, the cautious calculation was 2 × PLN 20,000 = PLN 40,000; the broader one was 3 × PLN 20,000 = PLN 60,000. The difference equaled half the value of the second demand. The recommended starting point was the cautious calculation, with the right to charge further penalties expressly reserved.

4. Use the promissory note as security, not as a guarantee of recovery

A blank promissory note with a PLN 120,000 limit does not create a separate claim. It may provide access to faster, cheaper order-for-payment proceedings under Article 485 § 2 of the Code of Civil Procedure—but only within the promissory note declaration’s scope.

Before completing the note, confirm:

1. Categories: Does the declaration cover every claim you intend to include—fees, penalties, and damages? An item outside its scope cannot be pursued through the note in order-for-payment proceedings.
2. Amount: Is the amount entered within the declaration’s limit?
3. Original documents: Do you hold the original note and declaration needed for the application?

If the debtor objects to an order for payment, the court examines the underlying relationship. The defendant may argue that the claim never arose, has been extinguished, or exceeds the declaration’s scope. Completing the note contrary to the declaration is an effective defense (Polish Supreme Court, IV CSK 465/17).

Bankruptcy is a separate risk. A former entrepreneur may apply for personal bankruptcy without waiting a year after removal from the business register, under Article 491¹ et seq. of the Polish Bankruptcy Law, Journal of Laws 2024, item 794. Liabilities from the former business, including contractual penalties and damages, may enter those proceedings and be discharged. A promissory note does not give the creditor a privileged source of recovery outside the bankruptcy estate.

Where bankruptcy is a genuine concern, consider seeking interim security for the claim alongside the lawsuit under Article 730 § 1–2 of the Code of Civil Procedure. You must make the claim and your legal interest sufficiently plausible. Relevant circumstances may include stopped payments, disposal of assets, or reduced operations (order VIII GCo 64/23).

5. Put a cut-off date in the demand

Customer reports may continue for six months after an outlet closes, while replacement-staff costs keep rising. Repeated demands with changing totals can make the claim look uncontrolled.

The demand should:

1. State a cut-off date and identify the amounts established as of its preparation.
2. Reserve expressly identified future claims, such as settlement for services omitted from the schedule, later customer refunds and reports, an inspection fee, and further contractual penalties.
3. Set a payment deadline, after which court proceedings can follow if payment is not made.

The second risk: customers of the closed outlet

Debt recovery and customer communication must be managed separately. A customer-service response can undermine the network’s position even if its claim against the former partner is sound.

Establish who contracted with customers

In the franchise arrangement described here, the franchisee—not the network—contracted with customers in its own name, on its own account, and at its own risk. Receipts, invoices, and sales terms should identify it as the seller.

Customers, however, see the brand and contact head office. If a response suggests that the network contracted with them or supervised delivery of the services, a consumer ombudsman or Poland’s Office of Competition and Consumer Protection (UOKiK) may interpret it as an admission of responsibility. Article 5(1) and Article 5(3)(2) of the Polish Act on Counteracting Unfair Market Practices may be relevant to an administrative assessment of whether consumers were misled about the trader’s identity (UOKiK source).

Civil liability toward consumers may arise where the franchisor:

1. Was the actual party to the customer contract.
2. Created a misleading impression about the trader’s identity.
3. Assumed specific customer obligations in its terms or through a network-wide guarantee.

Use two controlled response templates

The source’s operating rule is to select the customer-service template using one formal criterion: whether the customer has supplied proof of payment—not the tone or substance of the message. Apply the rule consistently. Template B also addresses reports about service quality.

For customer-service staff, the drafting rules are equally important:

• Call the contact a “report” rather than a “complaint”: under the position set out here, dealing with complaints is the seller’s responsibility, and the network was not the seller.
• Do not assess the partner’s service or compare it with company-owned outlets.
• Do not apologize for the partner’s services or state that the network supervised the outlet.
• Lock the template paragraphs on the partner’s status and the grounds for declining responsibility so staff cannot edit or add to them.
• Set a cut-off date for accepting reports and specify a contact channel.

An employee’s well-meant apology about service quality, coupled with a statement that the network controlled the outlet, can undo the intended position in a single response.

Keep customer-data use separate from the franchise exit

Ending the franchise does not itself entitle the network to take over the former partner’s customer database. A data processing agreement under Article 28 of the GDPR does not authorize the franchisor to process those data for its own purposes.

Contacting customers for the network’s purposes requires a separate basis under Article 6(1) of the GDPR. Direct marketing through telecommunications channels additionally requires consent under Article 172(1) of the Polish Telecommunications Law.

Before contacting customers, address three questions: Who is the data controller after termination? Is the network incorrectly relying on a processing agreement for its own purposes? Have the information requirements under Articles 13–14 of the GDPR been met on time?

Implementation checklist

Improve the agreement before the next partner exit

A difficult settlement can reveal problems in the network’s standard franchise agreement. At the next update, address:

1. Direct penalty references. Link each obligation intended to carry a contractual penalty to the specific penalty clause. Under the approach in the source, an obligation without that link provides no basis to charge the penalty.
2. Differentiated rates. Replace a single flat amount—for example, PLN 20,000 for every breach—with rates reflecting the seriousness of different breaches. This reduces the risk of a penalty being challenged as grossly excessive.
3. A documented exit procedure. Require sales-system extracts, appointment records, inspection documents, and handover records for premises and equipment when the relationship ends.
4. Customer-communication rules. Specify who informs customers about closure and how, and include a prohibition on the former partner contacting customers after termination.
5. An appropriately scoped promissory note declaration. Check that it covers franchise fees, contractual penalties, damages, replacement costs, and customer refunds.

Franchise remains an innominate contract in Poland. The Civil Code amendment approved in draft by the Council of Ministers in December 2023 contemplated, among other things, restrictions on contractual penalties and blank promissory notes used as security (Polish government information). As of the source article’s publication, it had not been enacted. Until specific legislation enters into force, contractual penalties are governed by Articles 483–484 of the Civil Code; termination is assessed against the particular agreement and the Civil Code’s general provisions.

Bring the claim and the communications under control

The sequence matters: legal basis → recovery procedure → verified amount → demand → lawsuit. A wrong total, a duplicate item, or a penalty multiplied by customer can weaken recovery of sums that were otherwise justified.

Run the customer-communications work in parallel. The network’s position depends not only on who signed the customer contracts but also on what its website, marketing, and staff say about them.

If your network is managing a partner exit in Poland—or preparing for the next one—contact us. We help structure partner agreements, penalty clauses, promissory note declarations, exit procedures, and controlled customer-service templates.

Frequently asked questions

Can we charge a contractual penalty for every customer served outside the system?
You can pursue that calculation, but it increases the risk of judicial reduction under Article 484 § 2 of the Civil Code. A separate charge for each customer can multiply the total and affect the penalty claim as a whole, including a correctly calculated portion. A more cautious starting point is one penalty for the documented practice, with further penalties expressly reserved.

Will a blank promissory note speed up recovery?
It may enable faster and cheaper order-for-payment proceedings if the claim falls within the declaration’s scope and you hold the original note and declaration. If the debtor objects, the court examines the underlying claim. An amount outside the declaration’s scope cannot use the note for that excess, and the note does not protect against the former partner’s personal bankruptcy.

Must a franchisor honor prepaid packages sold at the partner’s outlet?
As a rule, not if the franchisee contracted with the customer. Check the receipt, invoice, and sales terms. The network’s own website, marketing, or customer-service responses can nevertheless create risk if they suggest that it was the contracting party or assumed customer obligations.

How do we deal with reports arriving months after closure?
State in the demand which amounts were established by its cut-off date. Reserve identified categories of later claims, such as refunds, additional settlements, and penalties, then add later-established amounts in another letter or the court claim.

Can we use the former partner’s customer list to offer services at our outlets?
Termination alone does not transfer the right to use that database. Establish who controls the data and identify a separate basis under Article 6(1) of the GDPR for the network’s purposes. A data processing agreement is not that basis; direct marketing through telecommunications channels additionally requires consent under Article 172(1) of the Polish Telecommunications Law.

What agreement changes will make the next settlement easier?
Start with direct references between obligations and penalty clauses, penalty rates differentiated by breach, and a mandatory evidence package at exit. Also check that the promissory note declaration covers every intended category of claim.