Abstract

A public order is a private law contract. Apart from the regulations of the public procurement law, applicable to it are also the non-contradictory Civil Code provisions concerning the conclusion and performance of contracts as well as liability for infringement. Public procurement law quite frequently employs the construction of a contractual penalty, inter alia in Art. 143d.1.7a of the no longer applicable Public Procurement Act of 29 January 2004, as well as in the currently applicable Art. 423.7a of the Public Procurement Act of 11 September 2019. Those provisions require construction works contracts to include clauses providing for contractual penalties for non-payment or delayed payment of remuneration due to sub-contracts or their sub-contractors. A dispute has arisen against this background whether we deal here with a contractual penalty within the meaning of Art. 483 § 1 of the Civil Code since a contractor’s obligation subject to a contractual penalty is of a non-pecuniary nature or perhaps it is a special kind of a contractual penalty as a sanction for a breach of the obligation to pay of the contractor vis-à-vis the orderer; in the latter case the invoked provisions of public procurement law constitute lex specialis in relation to Art. 483 § 1 KC, or finally perhaps this provision is defective as it requires inclusion of a clause that is not compliant with the construction of a contractual penalty. The author argues that the latter view is correct.