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Warranty payment as an alternative to contractual penalty


Companies are using so-called warranty payments instead of contractual penalties more often. The are more effective in protecting the interests of one party against the other party’s inappropriate actions. Unlike a contractual penalty, warranty payments are not regulated in the Civil Code. The possibility of applying this solution results from the principle of freedom of contract (Article 3531 of the Civil Code), which leaves the parties with a lot of flexibility. – Bartosz Tomanek and Maja Konopa comment for Rzeczpospolita.

The article in Polish is avialible here.