Author: Barbara Leleno

act legal Poland used its multidisciplinary expertise as a legal advisor to and representative of Profit Development Group in a litigation concerning a big residential project in Warsaw

The dispute was focused on a property on which Profit Development Group carried out a residential project, through its subsidiary, based on inter alia a number of development contracts signed with residential unit buyers.

The housing cooperative (“W” Cooperative), which is controlled by a single individual, took steps aimed to frustrate the sale of residential units and take over the developed property. One of the steps involved filing a claim challenging the accuracy of records in the land and mortgage register kept for the property concerned as compared to the actual legal status.

Business solutions

The Client was offered a wide range of services beyond mere conducting the litigation. In particular, in order to protect the Client’s financial interests and restore the Client’s ability to sell the units, we proposed additional solutions which resulted in harvesting offers as well as negotiating and concluding, in cooperation with Marsh – a leading insurance broker – a trailblazing insurance policy aimed at protecting the Client and the buyers of the units against potential consequences of an unfavourable court ruling.

Litigation issues

After professional and swift court proceedings (proceedings in two instances took only two years), the court dismissed the appeal of “W.” Cooperative and ruled in favour of our Client. The courts of both instances had no doubt that the Cooperative’s claims were completely unfounded.

The key point of the argumentation which led to winning the case and which was prepared with active support of the Client was that of the public credibility of land and mortgage registers; our lawyers demonstrated that the principle effectively protected subsequent purchasers of the property, including the developer.

The developer was represented by Marek Wojnar, attorney at law, co-managing partner of act legal Poland, who was assisted by a team including:

• Marek Miszkiel – attorney-at-law, partner
• Marta Kosiedowska – attorney-at-law, partner;
• Michał Sołtyszewski – attorney-at-law, partner;
• Joanna Szymanowska – attorney-at-law, senior lawyer.

The court proceedings were conducted jointly with attorneys from Wrocław-based law firm SWK legal. We also cooperated with attorneys representing the buyers who participated as interveners.

The scope of our team’s work included: provision of comprehensive legal services in the case, including representation of the Client in court of first and second instance, participation in the preparation of the structure and development of specific measures to secure development agreements and other agreements concerning the sale of units. act legal coordinated the procedural positions with the representatives of the unit buyers, ensured transparent communication and secured the rights of the buyers in the course of the proceedings, as well as conducted negotiations and, in cooperation with Marsh, obtained a trailblazing insurance policy covering the risks related to the case for the Client’s needs.

”Cooperation with the Client in this case was not limited to strictly procedural aspects but concerned the development of a comprehensive set of solutions to ensure the security of the Client and the unit buyers. We are particularly pleased with the positive final ruling in the context of the interests of the unit buyers. For both Profit Development and for us, the social aspect and efficiently achieved fair ruling were the most important factors in this case,” emphasises Marek Wojnar, attorney-at-law, co-managing partner of act legal Poland.

We would like to thank the Client for entrusting our law firm with the case and for confidence they have placed in us.

A team of act legal Poland associates comprising:

• Piotr Pośnik – Attorney-at-law, Partner,
• Mateusz Prokopiuk – Attorney-at-law, Partner,
• Marlena Witkowska -Attorney-at-law, Senior Associate,

advised WBW Invest on the conclusion of an investment agreement with Marguerite and Griffin Capital Partners and on the sale of shares in a special purpose vehicle – WBW 2 Sp. z o.o.- ower of the OnTrain brand – which was established for the short-term and long-term lease of locomotives to European railway operators and the provision of maintenance services to them. OnTrain has already signed contracts for the delivery of 80 locomotives, with the remaining contracts under negotiation.

WBW Invest is a Polish investment company operating in the renewable energy, transport and logistics sectors, with extensive experience in the rail transport sector, particularly in the rental of rolling stock.

Marguerite is a pan-European infrastructure fund management company.

Griffin Capital Partners is a private investor, private equity and real estate asset management firm in Europe.

The joint action of WBW Invest, Marguerite and Griffin Capital Partners is a milestone in the development of the rail market in Poland and Europe. It is a strategic investment, part of a broader plan to transform energy and introduce modern logistics solutions.

‘We would like to thank all the entities involved in the project for their constructive action, understanding of the needs of the rail market and creating the ideal conditions for the development of our OnTrain platform,’ said Piotr Ignasiak, Managing Partner of WBW Invest.

Cracow City Council Resolution no. VIII/164/24 establishing a protected area of “Zakrzówek – eastern enclave” was rendered invalid in full by virtue of Lesser Poland Voivod’s Executive Decision no.  WN-II.4130.64.425.2024 of 03 October 2024.

Thus, the Voivod shared the argument presented by a team act legal Poland attorneys (Michał Wielhorski| Managing Partner; Marek Miszkiel| Partner; Michał Sołtyszewski| Partner; Justyna Kochanowska| Senior Lawyer; Joanna Szymanowska| Senior Lawyer) who represented our Client in the case. The protected area of Zakrzówek, which was established in violation of law, would frustrate a multifamily housing project otherwise authorised by the zoning plan applicable for the area.

When passing its Resolution, the Cracow City Council relied on invalid environmental stock-taking reports, some of which did not cover the Zakrzówek area while ignoring current expert evaluations commissioned by owners of the land located within the so-called eastern enclave, including evaluations drafted in 2024. According to these expert opinions, the site under consideration is not a habitat for any protected species, the presence of which would justify protection of the area concerned.

However, it was not the only argument for rendering the Resolution invalid. The full text of the Voivod’s Executive Decision is provided in the Journal of Laws for Lesser Poland Voivodeship of 3 October 2024, item 6132.

The Voivod’s Executive Decision is beneficial not only for our Client but also for Cracow City as it eliminates possible risk of claims related with the existence of a defective local law which would significantly restrict the use of the property concerned.

The Cracow City Council case of passing a local law which establishes a protected site on the area intended for residential development in accordance with a local zoning plan is not an isolated case. For this reason, it is so important that due diligence is not limited to a verification of zoning arrangements or zoning decision for a property in question. It is vital to take account of other valid regulations which restrict the development.

The act legal Poland law firm provided comprehensive legal advice to DCW 2 Sp. z o.o., a subsidiary of DC Willard Sp. z o.o., in the negotiations and conclusion of a contract for the sale of a real estate located in the centre of Gdańsk in the so-called ‘Stare Przedmieście’ district.

The seller was represented by an experienced team of lawyers: Marek Wojnar – Managing Partner and Marta Kosiedowska – Partner.

DC Willard Sp. z o.o. is a new player on the real estate market but it is dynamically developing and already has a number of real estate transactions in its portfolio. DC Willard Sp. z o.o. specialises in developing complex real estate projects; early next year the start of construction of residential estates in the suburbs of Warsaw is expected. The company is managed by Łukasz Dołęga.

The new buyer of the Gdańsk property is a company belonging to GH Development a group from Belgium which has more than 100 years of experience in the real estate market -. Since 2018 the company has also been developing residential projects in Poland.

This is another successful closing of a real estate sale transaction this year by our legal team. We are glad that we can assist our clients in further transactions,’ said Marek Wojnar/ Managing Partner of the Warsaw act legal office.

„I would like to thank everyone involved in this not-so-straightforward development project since its inception, and I also thank GH Development for sharing my vision for the project and trusting me”, said CEO of DC Willard Ltd.

“We are proud to have acquired a property in such an exceptional location. Thanks to the professional approach, trust and respect of each party involved, it was a pleasure to work on this transaction. We would like to thank you for your cooperation and hope that this is an excellent start to our lasting business relationship”, commented Aleksandra Żuralska – Country Manager of GH Development Sp. z o.o.