This Polish commercial agent, Mariusz Surma, sues Citibank Poland for $ 6,000,000 damages. Please find the English version of the story below.
See also: http://www.dziennik.pl/gospodarka/article129771/Polak_walczy_ze_swiatowym_gigantem.html
[English translation]
He threw the gauntlet to Citibank
Tuesday, February 26, 2008 00:11
A Pole wrestles with a global giant.
The greatest indemnification in the history of agency contracts in Poland?
This may prove to be the greatest indemnification in the history of agency contracts in Poland. Mariusz Surma (office@msds.pl) has accused Citibank Handlowy of destroying his company and taking over his best workers. He claims PLN 14,000,000 damages, DZIENNIK reported.
The proceedings continued for six years during which time this entrepreneur's claims were affirmed by the Court of Appeal and the Supreme Court. However, this year may ultimately see the end of the court drama. The files of the case have just been sent from the Supreme Court to the Regional Court in Warsaw. The first trial is due to take place in March.
And the whole thing started in 1999. At that time MS Direct Sales, a company based in Wroclaw, concluded an agency contract for Citibank's exclusive rights to sell its products. Almost a hundred commercial agents operated in three Polish provinces (Opole, Dolny Slask and Lubus) to successfully acquire over 40,000 new customers for Citigroup. "Thanks to us Citibank practically became the credit card market monopolist, whereas we sold almost 100% of its services in our area", said Mariusz Surma, President of MS Direct Sales.
The cooperation betweeen the company and the bank proceeded smoothly until 2001, when Citigroup bought [Polish] Bank Handlowy. And then, in September 2001, Citibank Handlowy directors breached the contract, even though it was legally valid until the end of May 2002. "Since [that breach] was illegal, they backed out, but then [Citibank Handlowy] started underhand tactics, outbidding us for our best agents", Surma recounted.
On October 23, 2001, Andrzej Krzeminski, the then managing director of Citibank Handlowy, arrived at the MS Direct Sales Head Office in Wroclaw to meet the agents. The visit, during which Krzeminski assured the employees they had no reason to worry because the termination of the contract would not entail losing their jobs, was secretly recorded by one of MS Direct Sales workers. "It is not our intention to abandon you as sales agents. After June 1, 2002, you are working for Citibank", he continued.
Meanwhile, the first take-over of commercial agents by the bank took place still during the existence of the agency contract, and in June, a real avalanche was triggered. It was the beginning of the end of MS Direct Sales. In the opinion of Dr Ewa Rott-Pietrzyk, Silesian University agency law expert, the taking-over of workforce of a company with which one has entered into an agency contract, is a typical example of disloyal conduct. And, under the Civil Code, both parties are bound to be loyal to each other. "In this event the company should fight for justice in court", said Rott-Pietrzyk.
These are not the only charges brought against Citibank Handlowy. The bank has also refused to meet its financial obligations towards the company. The Civil Code lays it down that after termination of the agency contract the commercial agent must be indemnified. "The amount of the indemnity may not exceed a figure equivalent to an indemnity for one year calculated from the commercial agent's average annual remuneration", Rott-Pietrzyk explained. Following the calculation rendered by the court experts the delinquent amount exceeds PLN 4,000,000.
In addition to all that, Citibank may have to pay MS Direct Sales as much as PLN 1,000,000 resulting from the restraint of trade clause, namely, the obligation incurred by the company to work exclusively for the benefit of the principal. However, all this led to the company's bankruptcy. "I lost my best men, I was paid no money, I had no funds to pay the others", Surma reflected. But this entrepreneur is a sticker and will not let go. In 2002, he sued the bank. "I demand PLN 14,000,000 together with the statutory interest. I want to rebuild my company and make people see that even an ordinary man can beat a huge corporation", Surma said.
Citibank Handlowy is determined to fight tooth and nail to defend its position. "We will refrain from any judgement or comment other than the position already presented to the court", Agata Charuba-Chadrys, a spokeswoman for Citibank Handlowy, told us.
Magdalena Janczewska
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