In its judgment file no. 31 Cdo 927\/2016 dated 11 April 2018, the Grand Panel of the Civil and Commercial Division of the Supreme Court of the Czech Republic addressed the issue, whether a contractual penalty used for an unilateral set-off may be lowered by the court.<\/p>\n
According to its earlier case law (e.g. the judgment of the Supreme Court of the Czech Republic file no. 32 Odo 1007\/2006 and decisions derived therefrom), it was not possible for a court to lower an unreasonably high contractual penalty if such penalty had been used for an unilateral set-off.<\/p>\n
The Supreme Court now expresses the opinion that such lowering of a contractual penalty by court has its effect ex tunc<\/em> rather than ex nunc<\/em>, i.e. as of the day of the agreement on the contractual penalty. If a contractual penalty is unreasonable, its unilateral set-off cannot result in expiration of the debt deriving from the contractual penalty or the debt, against which such unreasonable penalty is being set-off.<\/p>\n According to the Supreme Court, a court is entitled to decide on lowering an unreasonably high contractual penalty even in cases, where the creditor has unilaterally offset the contractual penalty against a debt owed to the debtor.<\/p>\n","protected":false},"excerpt":{"rendered":" In its judgment file no. 31 Cdo 927\/2016 dated 11 April 2018, the Grand Panel of the Civil and Commercial Division of the Supreme Court of the Czech Republic addressed the issue, whether a contractual penalty used for an unilateral set-off may be lowered by the court. According to its earlier case law (e.g. the […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[21],"tags":[],"pravni-oblast":[],"class_list":["post-2253","post","type-post","status-publish","format-standard","hentry","category-news"],"yoast_head":"\n