(Judgment of the Supreme Court of the Czech Republic, Case No. 33 Cdo 3134/2024, dated 22 October 2025)
The claimant concluded, via distance communication, a loan agreement with a person whom she considered to be the defendant. The courts of all instances found it proven that the person who in fact took the steps to conclude the agreement was not the defendant, but another person who was serving a prison sentence together with the defendant. Nevertheless, the amount of CZK 60,000 was, on the basis of this agreement, paid directly into the defendant’s account. Under the loan agreement, the defendant was to repay to the claimant a total of CZK 157,699 in 47 monthly instalments. The defendant did not pay any instalment – instead, he distributed the amount of CZK 60,000 that he received from the claimant to various accounts in the form of smaller amounts on the instructions of third persons. The claimant sought payment from the defendant of CZK 95,313.25 plus accessories.
The court of first instance concluded that the loan agreement was absolutely invalid because the claimant did not sufficiently assess the defendant’s creditworthiness. The court assessed the amount of CZK 60,000 as unjust enrichment and ruled that the defendant was obliged to return this amount to the claimant. According to the court, the obligation to return the money was not affected by the fact that the defendant subsequently, according to the defendant’s assertion, “by mistake”, forwarded the amount to other accounts – the unjust enrichment arose already by transferring the amount to the defendant’s bank account.
The appellate court reached a similar conclusion, but with different reasoning. According to the appellate court, there was no doubt that the defendant did not negotiate the conclusion of the agreement at all – another person acted for him, impersonating him. Thus, no bilateral legal act took place and the contract did not come into existence (the fact that the claimant did not sufficiently assess creditworthiness holds, but given that the contract did not come into existence at all, this fact is irrelevant). It also considered the amount of CZK 60,000 to be unjust enrichment and ruled that the defendant was obliged to refund this amount to the claimant. Sending the amount to other accounts on the basis of instructions from third persons was contrary to the statutory requirement to act with ordinary care and caution and therefore has no effect on the defendant’s obligation to return the amount sent by the claimant.
The defendant filed an appeal on points of law against the appellate court’s judgment. The Supreme Court stated that a situation where a “fraudster” impersonates someone else must be addressed under the provisions on representation, specifically unauthorised agency under Section 440 of the Civil Code. It considered both the appellate court’s conclusion that the contract did not come into existence and the court of first instance’s conclusion that the contract did come into existence but is invalid to be incorrect. According to the Supreme Court, the acts of an unauthorised agent (i.e. the person who actually dealt with the claimant) bind the defendant if the defendant subsequently approves them. This approval does not have to be express, but may also be implied (conclusive). According to the Supreme Court, the appellate court should have examined whether the defendant subsequently did not approve the contract when he accepted the performance, further disposed of it, and did not express a will to refuse such approval. If such approval occurred, the defendant would be regarded as a contracting party with all consequences arising therefrom (including the obligation to return the money under the contractual rules, not merely as unjust enrichment). The Supreme Court noted that even if the contract were subsequently found to be defective (invalid), after its approval (ratification), the represented person becomes a contracting party and bears the obligation to disgorge any unjust enrichment arising from performance under that contract.
It follows from the Supreme Court’s decision that misuse of personal data, without the knowledge and consent of the person concerned, to conclude a contract does not automatically mean the non-existence of the legal relationship that was intended to arise from that contract. The situation can be assessed as unauthorised agency – if the person whose identity was misused subsequently approves the act, even silently (e.g. by accepting the money and further disposing of it), that person becomes a contracting party to the contract. Such a person is bound by the contract ex tunc, i.e. retroactively, as if they had concluded it themselves from the outset.
Legal Update 01/2026 here.