Payment order in payment order proceedings – why is it worth using it?

A faster way to recover your debts

In business and private relationships, situations arise where a debtor fails to settle their obligations despite the payment deadline having passed. In such a situation, the creditor faces a choice: to pursue full legal proceedings or to use the simplified procedures provided for in the Code of Civil Procedure. One of the most effective tools is payment order in payment order proceedings.

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Legal basis and conditions for obtaining

According to Article 484¹ of the Code of Civil Procedure, a payment order in payment order proceedings is issued only at the request of the plaintiff, filed in the lawsuit. So it's worth starting from the beginning plan a process strategyto be able to use this mode.

The motion filed in the lawsuit must be accompanied by appropriate documents proving the facts supporting the claim being asserted. These documents constitute the basis upon which the court may issue an order. These most commonly include:

• official documents,
• invoice accepted by the debtor,
• a request for payment with a written acknowledgement of the debt,
• bill of exchange or cheque duly completed,
• contracts, evidence of mutual non-monetary performance, or evidence of delivery of an invoice or bill to the debtor when the plaintiff is claiming the debt payment of a monetary benefit, which constitutes remuneration for the delivery of goods or the provision of a service in a commercial transaction;

It is worth noting that the plaintiff must attach to the lawsuit the originals or certified true copies of the indicated documents.

The order proceedings are carried out on closed session without the participation of the partiesThe court issues an order based on the submitted documents, without scheduling a hearing. This is intended to expedite the proceedings, which is one of the advantages of the order procedure.  

Payment order

A payment order issued in payment order proceedings, upon issuance, becomes a security title by operation of law. This means that this order not only resolves the case on its merits but also serves as the equivalent of a decision granting security. It is worth noting that a payment order as a security title is enforceable without an enforcement clause. It may be used to secure monetary claims in the manner specified in Article 747 of the Code of Civil Procedure, including through:

• seizure of movable property, remuneration for work, receivables from a bank account or other receivables or other property rights,
• encumbering the obligor’s real estate with a compulsory mortgage,
• establishing a ban on the transfer of cooperative ownership rights to premises.

In other words, immediately after issuing a writ of payment in payment proceedings, we can take it to the bailiff and secure ourselves against the debtor's assets for the duration of any potential proceedings. The process can last up to several years, and during that time, we don't have to worry about that the debtor will "run away" with his property, because we have secured funds for our receivables.

Why is a payment order in payment order proceedings “better” than a payment order issued in payment order proceedings?

1. Speed of procedure – the case is heard in closed session, which significantly shortens the waiting time for a decision.
2. Lower costs – the court fee is only ¼ of the lawsuit fee (approximately 1.25% of claim value), which is a significant saving.
3. Immediate creditor protection – a payment order in the payment order proceedings, upon issuance, constitutes security title, without the need to grant it an enforcement clause.
4. Higher barriers for the defendant – the defendant may file a motion, but must pay a court fee of ¾ of the lawsuit fee, which often discourages unjustified contestation of the claim.

What does the procedure look like step by step?

1. Preparation of the lawsuit with an application for issuing a payment order in payment order proceedings.
2. Attaching documents confirming the claim in accordance with Article 485 of the Code of Civil Procedure
3. Filing a lawsuit in court competent according to the provisions on local jurisdiction.
4. Issuance of an order by the court in closed session.
5. Possibility of securing receivables immediately after the order is issued.
6. If the defendant files an objection – consideration of the case in the ordinary course, while maintaining the security power.

Summary

Payment order proceedings are particularly beneficial for creditors who have strong evidence of the debt. The speed of the procedure, lower costs, and the ability to immediately secure the claim make payment orders in this procedure often the best choice.

If you have documents confirming your claim, it is worth considering this path already at the stage of preparing the lawsuit.. Contact us and we will help you assess the chances of obtaining a payment order in payment order proceedings and prepare complete procedural documentation.