The Constitutional Court found No 241 / 2010 Coll.
The Constitutional Court's finding of 1 July 2010 on the application for annulment of certain provisions of Act No. 182 / 2006 Coll., on bankruptcy and its methods of resolution (insolvency law), as amended
Valid
The Constitutional Tribunal found
Text versions:
17.08.2010
241
FIND
The Constitutional Court
On behalf of the Republic
The Constitutional Court decided on 1 July 2010 in plenary in the composition of Stanislav Balík, František Duchoň, Vlasta Formánková, Vojen Güttler, Ivana Janů, Vladimir Køírka, Dagmar Lastovecká, Jiří Mucha, Jan Musil, Jiří Nykodém, Pavel Rychetský, Miloslav Excellent, Eliška Wagner and Michaela Židlická on the proposal SCA Packaging Czech Republic, s. r. o., with the seat Teplická 109, Jílové, Central Bohemian Gas, a. s. s., on the annulment § 192 (1), § 198 (1) and § 201 (1) of Act No. 182 / 2006 Coll.
as follows:
I. Paragraph 192 (1) of the first sentence, including the sentence after the semicolon of Act No. 182 / 2006 Coll., on the bankruptcy and methods of its resolution (insolvency law), as amended, shall be deleted on 31 March 2011.
II. The remainder is rejected.
Reasons
Procedure
1. The Constitutional Court received constitutional complaints from the appellants referred to above against the decisions of the insolvency administrator of the debtor and against the action of the Municipal Court in Prague in the context of those insolvency proceedings, linked to the application for annulment of § 192 (1), § 198 (1), § 199 (1) and § 201 (1) of Act No. 182 / 2006 Coll., on the bankruptcy and methods of its resolution (insolvency law).
2. The Plenum of the Constitutional Court has joined all three proposals and the case is conducted under point II of the ÚS 1412 / 09.
3. The second Chamber of the Constitutional Court found no reason to reject a constitutional complaint by the appellants pursuant to Article 43 of Act No. 182 / 1993 Coll., on the Constitutional Court, as amended, (hereinafter referred to as "the Law on the Constitutional Court '), since the contested provisions gave rise to a fact which is the subject of a constitutional complaint, the formal grounds for its hearing pursuant to Article 43 (1) of the Law on the Constitutional Court were met and the constitutional complaint was not found to be manifestly unfounded pursuant to Article 43 (2) (a) of the Constitution of the Czech Republic (hereinafter referred to as" the Constitution').
Recital of the proposal and essential parts of the observations of the participants
4. The applicant SCA Packaging Czech Republic, s. r. o., stated that she and other creditors submitted a comprehensive legal analysis to the insolvency administrator, a detailed legal argument to deny other creditors' claims and proposed evidence to be provided to properly establish the claim. The insolvency administrator did not deal with the evidence proposals and also did not deal with the legal argument in the legal analysis. If, during the insolvency proceedings, the Municipal Court in Prague found that a significant part of the creditors reasonably questioned the claims of the interveners, which had a decisive influence on the satisfaction of the claims of the other creditors, it should have ordered the insolvency administrator to deal with these initiatives and to carry out detailed investigations into the contested claims. However, the municipal court remained completely dormant in its supervisory activities. In the review proceedings, it was confined to the lesson provided for in Paragraph 192 (1) of the Insolvency Act and instructed the creditor that they had no right to deny other creditors' claims.
5. The applicant of the Central Bohemian Gas Association, a.s., stated that the insolvency administrator and the court did not pay due attention not only to the alleged facts and legal objections of the appellant and other creditors listed above, but in particular to the evidence proposed and even submitted in the form of "cash flow analysis in Bohemia Crystalex Trading, a. s., in 2001." Neither the insolvency administrator nor the court decided on this evidence.
6. The appellant RWE Energy, a. s., stated that at the review hearing it requested that Citibank's claim be paid special attention, that doubts regarding this claim were notified in advance by the court and the court and the oral insolvency administrator in writing. The Court of First Instance then informed the appellant that it had been given the opportunity to express its views in writing on Citibank's claims and that the denial of claims would not be permitted by a creditor which the insolvency law does not allow. The appellant RWE Energie, a. s., proposed to the court to order the insolvency administrator to read its decision on Citibank's claim and, in view of the final nature of the review, to give the appellant's objections due justification. The insolvency administrator has indicated that it is not for the insolvency administrator to deal with the claims of creditors, analyses of accounts and legal considerations in the context of the review of claims, and this should be exclusively for the court. In the opinion of the insolvency administrator, there was no public argument to refute the conclusions of the legal opinions submitted by the appellant. Yet the court is content with it.
7. The appellants contend, in relation to the contested provisions of the insolvency law, that the incorrect application or recognition (not denying) of specific claims of certain other creditors in insolvency proceedings by the insolvency administrator means that, as a result of a reduction in the satisfaction of their claims, that is to say, their rights, in particular property rights, are affected. The decision of the insolvency administrator to recognise or deny claims is binding on the creditor's right to a proportional satisfaction in the insolvency proceedings (including other consequences). Therefore, in the event of recognition of the creditor's claim, it is consistently decided (inter alia) the amount (proportional) of the satisfaction of the other creditors applied for, whose claims are in competition with each other. If the insolvency administrator does not deny the contested claims, it shall not give the other creditors the opportunity to establish the actual authenticity, amount and collateral of the claims before an independent and impartial court and thus the requirement of a fundamental right to judicial protection pursuant to Article 36 (1) of the Charter of Fundamental Rights and Freedoms ("the Charter ') and Article 6 of the Convention on the Protection of Human Rights and Fundamental Freedoms (" the Convention') is not fulfilled. The position of the insolvency administrator, as regulated by the insolvency law, cannot be equated to an independent and impartial judicial body as envisaged by Article 36 (1) of the Charter and Article 6 of the Convention. In particular, the fundamental attributes of the independence and impartiality of the judicial authority shall be irrevocability, non-translatability and the provision to function without a time limit. Furthermore, the insolvency administrator does not meet the incapacity attributes because, pursuant to Paragraph 29 (1) of the Insolvency Act, it is refundable on the basis of the majority of the creditors applied for, calculated on the basis of the amount of the claims. Since, by denying the claim of another creditor, the creditor also protects its property - and therefore its fundamental - right, the contested provisions infringe Article 4 of the Constitution, Article 13 of the Convention, as well as Article 11 (1) of the Charter and Article 1 of the Additional Protocol to the Convention. The reason for the adoption of the contested provisions appears to have been the abuse of the right of action by certain creditors and the attempt to speed up the insolvency proceedings as much as possible. However, this certainly legitimate objective must be consistent with the principle of proportionality (proportionality), as expressed in Article 4 (4) of the Charter, according to which, in order to limit fundamental rights and freedoms, their substance and meaning must be investigated. The contested provisions, as the appellants believe, have completely removed from the proportionality limits, as the principle of speed has disproportionately put the principle of protection of creditors' property rights above the principle of protection. The European Court of Human Rights (hereinafter referred to as "the ECHR ') always underlines the principle of a fair balance between the general interest of the community (and society) and the right of the individual to protect property, and in this context always examines whether State interference in individual property rights is an excessive and disproportionate burden on him.
8. In addition to the proposal, the appellant RWE Energie, a. s., stated that the absence of a claim law and the current form of insolvency law cooperates with the interests of large and by the essence of their business of always secured creditors - banks, thereby harming other unsecured creditors whose level of satisfaction under the new insolvency law has been reduced from an average of 9 to 4% (data are unverified) in comparison to the previously applied Act 328 / 1991 Coll., on bankruptcy and settlement. It is a public secret among insolvency administrators that banks' claims in the Czech Republic do not need to be subject to a thorough review, as there is a strong belief that banks represented by reputable law firms do not simply make errors in the creation, administration and recovery of their claims. The legal requirements for the person of the insolvency administrator and the possibility of seeking ex post compensation from the insolvency administrator cannot be seen as an adequate measure to counteract the denial of the creditor's claim. However, according to Article 13 of the Convention and the established case law of the European Court of Human Rights, the Institut of Compensation is not considered to be an effective remedy for an incorrect decision before a national authority; it is not an appeal that is truly effective and effective; it is only able to remedy (or mitigate) the adverse consequences of a defective decision within the property sphere of the injured party. It is hard to imagine that a damaged creditor in charge-bearing proceedings in the current Czech justice system would be able, at an acceptable time, to effectively obtain compensation for damages to the insolvency administrator in the order of hundreds of millions of crowns which he created as a result of a defective review of claims by the insolvency administrator.
9. In addition to the proposal, RWE Energy, a. s., refers to some foreign legislation (Austria, Germany, United Kingdom, etc.), according to which the creditors are granted the right to claim.
10. The Chamber of Deputies, in its observations on the proposal, stated that Law No 182 / 2006 Coll. was ordered to discuss it at its meeting on 1 December 2005 and on 20 January 2006 and recommended that it be approved as a comprehensive amendment contained in the resolution of Committee No 235 (Press 1120 / 1). This comprehensive amendment was amended by the provisions of § 192 (1), § 198 (1), § 199 (1) and § 201 (1). The draft law was approved in its third composition on 8 February 2006, as amended by the Comprehensive Amendment to the Constitutional Legal Committee and other amendments, but no longer related to those provisions.
11. The Senate stated that there was no discussion in both the Senate committees and at the Senate meeting on the provisions proposed for annulment. In the light of the foregoing, it can be concluded that there were no views in the upper chamber of Parliament which could be supported by the appellants' assertion that the provisions of § 192 (1), § 198 (1), § 199 (1) and § 201 (1) of the Insolvency Act could be rejected or rejected.
Derogation of the contested provisions of the law
12. The contested provision of Paragraph 192 (1) of the Insolvency Act reads: "The debtor and insolvency administrator may deny the authenticity, the amount and order of all claims applied for; individual creditors do not have this right. The opinion adopted by the insolvency administrator on individual claims in the list of claims applied for may be amended in the review hearing. '
13. The contested provision of Paragraph 198 (1) of the Insolvency Act reads as follows: "Creditors of an irrecoverable claim which has been denied by the insolvency administrator may exercise their right of application for designation before the insolvency court within 30 days of the review hearing; However, this period shall not end until 15 days after the notification referred to in Article 197 (2) has been received. They shall always bring actions against the insolvency administrator. If the action does not reach the insolvency court within the prescribed period, the claim denied in its authenticity shall not be taken into account; a claim denied up to the amount or order in which case the amount or order indicated at the time of the denial shall be established. ';
14. The contested provision of Paragraph 199 (1) of the Insolvency Act reads: "The insolvency administrator who denied an enforceable claim shall, within 30 days of the review of the proceedings before the insolvency court, bring an action which his denial will bring against the creditor who filed the enforceable claim. The time limit shall be maintained if the action is brought not later than the last day of the time limit of the court '.
15. The contested provision of Paragraph 201 (1) of the Insolvency Act reads: "An inenforceable claim is established (a) if it has not been denied by the insolvency administrator, (b) if the insolvency administrator who denied it withdraws his denial or (c) by a decision of the insolvency court in a dispute concerning its authenticity, amount or order."
Constitutional conformity of the legislative process
16. The draft Insolvency Act, which was subsequently published under No. 182 / 2006 Coll. (House Press 1120 / 2 of the Chamber of Deputies 2002- 2006, 4th Election), was discussed by the Chamber of Deputies of the Parliament of the Czech Republic as a print 1120 at first reading on 26 October 2005 and ordered to be discussed by a constitutional legal committee which discussed it at its meeting on 1 December 2005 and on 20 January 2006, and recommended that it be approved as a comprehensive amendment contained in resolution 235 (Press 1120 / 1). This comprehensive amendment has also been modified by the new and contested provisions. The second reading of the draft law took place on 27 January 2006, the amendments made at second reading were processed as print 1120 / 2. The bill was approved by the necessary majority of Members present at third reading on 8 February 2006, as amended by comprehensive amendments. The bill was passed on to the Senate on 28 February 2006 and was ordered by the Senate Organizing Committee as Press No. 288 (5th term of office) to discuss it to the Constitutional Legal Committee. This committee discussed the draft law on 15 March 2006 and adopted Resolution No 93 (Senate Document No 228 / 1), in which it recommended that the Senate approve the draft law in the version referred to by the Chamber of Deputies. The Senate Plenum discussed the bill at its 10th meeting on 30 March 2006, when in vote No 199 on the bill by resolution No 416, the bill was approved in the version referred to by the Chamber of Deputies. 49 senators out of 54 were voted in favour, 5 senators abstained and no one was against it. The law was delivered to the President for signature on 7 April 2006 and signed on 14 April 2006. The approved Act was delivered to the Prime Minister for signature on 27 April 2006 and was published in the Collection of Laws on 9 May 2006 in an amount of 62 under the number 182 / 2006 Coll.
17. The Constitutional Court notes that Law No 182 / 2006 Coll. has been adopted and issued within the limits of the Constitution established competence and in the constitutionally prescribed manner, or that it has found nothing in the present proceedings to suggest otherwise.
Evaluation of the Constitutional Court
18. The Constitutional Court first addressed the position of the insolvency administrator in the recognition of creditors' claims in insolvency proceedings and assessed it as a public authority, not as a representative of creditors.
19. The term public authority does not define the Constitution; Therefore, the Constitutional Court acceded to its scope in its case-law, in which it opted for the so-called power theory [cf., for example, the Constitutional Court of the Czech and Slovak Federal Republic decision sp. zn. I. ÚS 191 / 92 of 9.6.1992, Reports of resolutions and findings of the Constitutional Court of the Czech and Slovak Federal Republic, 1992, Decision No 3; Resolution of the Constitutional Court of sp. zn. II. ÚS 75 / 93 of 25.11.1993 (U 3 / 2 SbNU 201 *); and others].
20. The recognition of the creditor's claim by the insolvency administrator is governed by Section 188 et seq. The insolvency practitioner, by recognising the claim applied for (no doubt), determines the creditor's right to its proportional satisfaction in insolvency proceedings (including any other consequences associated with the outcome of the review, i.e. voting and participation in creditors' bodies, sanctions and other procedural rights and obligations), while at the same time making binding the right of all other creditors to their proportional satisfaction [as a result of the recognition of the creditor's claim is also the determination of the amount (proportional) of the satisfaction of the other creditors who are in competition with each other]. The recognition (non-denial) of the claim by the insolvency administrator therefore results in the finding of the claim applied for in the insolvency proceedings definitively.
21. Although the insolvency law does not explicitly state the nature of the act of the insolvency administrator by which it shows its willingness to recognise the claim applied for, it is naturally necessary to examine the act of the insolvency administrator according to the material point of view, i.e. its actual nature and effects [cf. e.g. the order of the Constitutional Court sp. zn. IV. ÚS 233 / 02 of 28.8.2002 (U 30 / 27 SbNU 337)].
22. The legal opinion expressed in the Constitutional Court's finding case law is applicable to the issue. The Constitutional Court, for example, found in sp. zn. However, as a special procedural body, it has a separate position with regard to both the insolvency and the bankruptcy creditors and cannot be considered as representatives of the insolvency creditors or of the insolvency creditors. The Constitutional Court then added that "it is based on considerations defining the concept of a public body: they are the public purpose, the method of establishment and the powers. The public purpose of the institution of the insolvency administrator must be seen in the acceptance of limited public intervention in the resolution of property relationships that have entered into a crisis situation. The manner in which it is set up is determined by a decision of a state body (court). Its powers, which are enshrined in a number of provisions of the bankruptcy and settlement law (Sections 14, 17 to 20, 24, 26 to 29), due to their heteronomic nature (when the trustee cannot be considered to be representatives of bankruptcy creditors or of the insolvency), constitute the exercise of powers (unlike the heteronomic nature of public acts, acts of private law - acts of law - are autonomous). '
23. The public purpose of the institution of the insolvency administrator must also be seen in the acceptance of limited public intervention in the resolution of property relationships that have entered into a crisis situation. Its powers, which are enshrined in a number of provisions of the insolvency law, in view of their heteronomic nature (when the insolvency administrator cannot be considered as a representative of creditors or debtor), constitute the exercise of jurisdiction (cf., or the power to recognise claims applied for, which is also the issue in the case at hand). The method of its establishment is determined by a decision of a State authority (court), pursuant to Section 25 of the Insolvency Act (cf. paragraph 1, first sentence: "Insolvency Trustee provides for insolvency court.")
24. This does not change the fact that the participation of creditors in the selection of the AIFM may - but may not - also play a role in the process of setting up the insolvency administrator. The person of the insolvency administrator can only be changed by creditors, they can only do so after the end of the review proceedings (Paragraph 29 (1) of the insolvency law), when it is no longer possible to assess the correctness of the claims applied by individual claims applications (pursuant to Section 192 (1) of the insolvency law, the insolvency administrator may change its position on the claims applied for at the latest at the review hearing).
25. After all, the explanatory memorandum to the draft law stated explicitly that the insolvency administrator is a special procedural entity which is neither representative of the debtor nor representative of creditors. The intention of the legislature that the insolvency administrator is not a representative of creditors was not contested when the draft law was discussed and was declared precisely in relation to the possibility for creditors to replace the person of the insolvency administrator.
26. However, the notion that the insolvency administrator, when recognising (authenticity, amount and order) the claims applied for, is acting as a representative of the creditors is also excluded by the nature of the case, usually more creditors whose claims are in competition with each other in insolvency proceedings. In addition, according to Section 24 of the Insolvency Act, the reasons for the bias of the insolvency administrator may also apply to the parties; Therefore, not only the debtor, but also its creditors. How could an insolvency administrator be biased on account of its own relationship with creditors (unbiased in this respect requires Article 24 of the insolvency law) when, at the same time, the insolvency administrator would have paid the claim that the insolvency administrator is a representative of creditors.
27. The insolvency administrator therefore authoritatively decides on the rights and obligations of creditors who are not in an equal position with the insolvency administrator, the content of the decision does not depend on their will. Therefore, the opinion of the insolvency administrator on the creditor's claim at the review meeting, which is expressed in the list of claims applied for, annexed to the review report, can be considered as a decision of the insolvency administrator.
28. The appellants propose, for reasons of unconstitutionality, to abolish, in particular, the first sentence of Paragraph 192 (1), including the sentence behind the semicolon of the insolvency law, according to which: "The debtor and the insolvency administrator may deny the authenticity, amount and order of all claims applied for; individual creditors do not have this right. ';
29. The contested provision contains a exhaustive list of persons entitled to deny claims. Moreover, the disclosure of this standard is reinforced by the explicit indication that individual creditors (i.e. even the appellants) do not have this right.
30. The basic purpose of the insolvency law provided for by the insolvency law is to address the debtor's property relations in bankruptcy and to satisfy the creditors' claims on the debtor's property. For example, according to Section 1 (a) of the Insolvency Act, "This Act regulates the resolution of the insolvency and the imminent bankruptcy of the debtor by some of the procedures laid down in order to organise property relations with the persons concerned by the debtor's insolvency and to satisfy the debtor's creditors as fully and substantially as possible." More creditors exercise the right to satisfy their claims on one of the debtor's assets. Therefore, the incorrect application or recognition of (not denied) the insolvency administrator of the one creditor's claim (its authenticity, amount, order) may result, inter alia, in the satisfaction of the other creditor's claim to a lesser extent than would have been the case if the claim in question had been correctly established. It can therefore consistently mark the property rights of the creditor and the other rights of the creditor (cf. other consequences linked to the outcome of the review, i.e. voting and participation in the creditor bodies, sanctions and other procedural rights and obligations). It is possible to agree with the appellants' view that the decision of the insolvency administrator to recognise or deny the claim applied for (or to what extent) determines the creditor's right of proportional satisfaction in the insolvency proceedings (including any other consequences linked to the outcome of the review), while making binding decisions on the right of all other creditors to their proportional satisfaction. As the expert literature points out, it is rare that in insolvency proceedings they try to assert their influence on persons who claim to be creditors, even though they are not, or a number of creditors are deliberately trying to exaggerate (overestimate) the amount of their claim in order to gain more influence in this proceedings than they deserve (cf. Taranda, P.: Above some aspects of the penalty for overapplied insolvency proceedings, Dana, 2008, No 6, p. 53).
31. The contested provision excludes the possibility for one creditor to challenge other creditors' claims by any means of procedure, or on the basis of adequate application of the civil Code. A standard legal instrument aimed at calling into question the debtor's creditor's claim is the so-called law of denial. If the first sentence of Paragraph 192 (1) behind the semicolon of the insolvency law is denied to creditors the right to deny claims by other creditors, the legislature has shown that creditors do not have the option of seeking to challenge the claim by not only an act of denial in the context of the review proceedings, but also by any legal institution of the exercise of the right (such as an action to determine the claim of another creditor or an appeal against the decision of the insolvency administrator). The first sentence of Paragraph 192 (1) and the sentence behind the semicolon of the insolvency law lex specialis are therefore all other procedural means of protection. Otherwise, the legislature's will would be circumvented, the first sentence of Paragraph 192 (1) alone, and the sentence behind the semicolon of the insolvency law would lose reasonable meaning.
32. The Constitutional Court has already addressed the outlined issue in its case law.
33. In the finding of sp. zn. Pl. ÚS 72 / 06 of 29.1.2008 (N 23 / 48 SbNU 263; 291 / 2008 Coll.), the Constitutional Court dealt with the constitutional conformity of the legal regulation which limited the scope of the facts which the tax guarantor was entitled to object to in the appeal against the "guarantee" challenge.
34. In this finding [as well as subsequently found in sp. zn. both available at http: / / nalus.ujud.cz], the Constitutional Court expressed the legal opinion that Article 36 (1) The Charter lays down the right of everyone to seek protection of their rights in a court or other body. The purpose and purpose of this provision is to lay down the obligation of the State to grant protection to everyone, since there cannot be a situation in a legal State in which the right-holder cannot obtain protection (in a court or other institution). It is based in general on the fact that the state is here to protect its citizens, but also those who reside in its territory, to guarantee that their rights are protected. Paragraph 4 of Article 36 of the Charter (referred in essence to in paragraph 1 of Article 36 of the Charter of Texts "established by the procedure ') refers to a law which regulates the" conditions and details' in relation to all preceding paragraphs of Article 36 of the Charter, but such a law, issued under constitutional authority, is bound by the provisions of Article 36 of the Charter and cannot therefore derogate from its content. The purpose and purpose of the "ordinary" law referred to in Article 36 (4) The Charter is merely to lay down the conditions and details of implementation as regards its content (already) by the legislator in Article 36 of the Charter of anchored rights, namely those of a purely procedural nature (not "material law '). At that time, the Constitutional Court also stated that" it is so irrelevant to argue that the key aspect of the constitutional conformity of such a law is, for example, the degree of denial of these constitutional rights by the legislator, etc., as the Supreme Administrative Court argued in sp. zn. 2 Afs 51 / 2004:... "the constitutional courts arising from Article 36 (1) of the Charter of Fundamental Rights and Freedoms and Article 1 (1) of the Charter of Fundamental Rights and Freedoms and Article 36 (1) of the Charter of Fundamental Rights and of the Charter of Fundamental Rights and of the Charter of Fundamental Rights and of the Law of Fundamental Rights of the Republic of the Member States of the European Union,". However, the Constitution does not allow the tax guarantor to be so widely denied the right to effective defence of his subjective public rights... "Where everyone has, pursuant to Article 36 (1): The Charter of the right to seek the protection of its rights in a court or other body, with the conditions and rules governing the exercise of that right laid down by law, such a law, issued on the basis of a constitutional mandate, cannot claim the protection of its rights in a court or other body in which the situation is completely negligent, thereby denying the constitutionally guaranteed fundamental right. Article 36 (1) Each Charter is constitutionally guaranteed the possibility of seeking protection of its right in a court or other body for all situations.
35. This also follows from the axiom of a reasonable constituency. It would, however, conflict with the notion that the legislature would leave the legislature, in whose competence to establish fundamental constitutional values in the form of fundamental rights and freedoms (contained in the Charter), at the same time, does not have confidence (that is why it has anchored it itself), in principle a free space for establishing the content of one of the fundamental principles of the rule of law in the form of a guarantee of the judicial protection of subjective public rights, i.e. when an individual can still protect his rights and when he no longer can. In such a hypothetical case, the legislator would, in a substantial part, degrade this key principle of the rule of law practically to the principle of only the legal [in view of the (essentially) content determination of the wishes of the "ordinary 'legislator].
36. It cannot therefore be concluded that the legislature has restricted the contested provision, even annulled the creditor's right to seek protection of his rights in a court or other institution, thereby denying the fundamental right under Article 36 (1) of the Charter in these cases. The contested provision of § 192 (1) of the first sentence, including the sentence behind the semicolon of the insolvency law, is contrary to Article 36 (1) of the Charter. Moreover, pursuant to Article 4 (4) The Charter must be examined as to the substance and the meaning of the fundamental right, i.e. the fundamental right cannot be denied, but this has done so. The contrary view would be contrary to the above-mentioned case law of the Constitutional Court, from which the Constitutional Court found no reason to deviate.
37. Moreover, the previous provision in § 21 (2) of the Act on bankruptcy and compensation, which, contrary to the current regulation, conferred on other creditors the so-called right of action, shows that the constitutional conformity of the granting of the right to deny creditors the claims of other creditors is possible.
38. It is not possible to attest the argument of the Municipal Court in Prague mentioned in the statement on the constitutional complaint that the intervention in Article 36 (1) The Charter is justified by the efforts to prevent abuse of the right of action leading, for example, to delays in proceedings. This is because it presupposes the intention of the creditor to abuse the right despite that the causes (denial of another creditor's claim) may be objective (in particular, the incorrect amount of the claim claimed by another creditor). Access to the court cannot be subordinated to a speculative reasoning of the type of presumption of guilt [that is how the Constitutional Court argued already in the sp. zn. II. ÚS 217 / 98 of 22.6.1999 (N 95 / 14 SbNU 283)]. It is necessary to find other ways to prevent the abuse of which right in insolvency proceedings (which, moreover, the insolvency law fulfils in other aspects - e.g. prevention of abuse of the right to claim under § 178 insolvency law). After all, any right can be misused, which led to ad absurdum would mean that no right could be granted to any entity because it could be misused.
39. The steering speed can only be considered within a specific - fair - process. The process, even if guaranteed as "quick," would not have a reasonable meaning if it had not been fair, would not have given a fair result, i.e. (inter alia) unless everyone had the opportunity to seek protection of their right (a conceptual part of the process). The fundamental right provided for in Article 36 (1) of the Charter of Everyone to protect his or her right, feasible in proceedings, of the nature of the matter precedes the speed of the procedure, is his or her binding basis. Otherwise, the process and its speed would become virtually self-interest.
40. Compliance with the management speed requirement is guaranteed by other insolvency law instruments. For example, the explanatory memorandum to the draft insolvency law - which, contrary to the contested provision, enshrined in the creditor's right of protest - states explicitly that "the aim is to achieve the speed and efficiency of the proceedings. Achieving the speed and efficiency of management is an effort and aim of perhaps every procedural adjustment. However, the verified fact remains that this objective can almost never be achieved by simply introducing formal timetables. The draft insolvency law introduces formal timescales in a number of places (compared to the current regulation more frequently), but it is based on a concept that these timescales will only be implemented in conjunction with other measures (other legal provisions) that allow the relevant timelimit to be actually complied with. Following this intention, it creates an outline of the scope for differentiated approaches, simplifies management by removing its phases and removing certain institutes that have enabled it to delay management. This is, for example, an exit from the withdrawal of the withdrawal period within the current concept, the failure of which shows that only 8 withdrawal periods were allowed between 1998 and 2003 inclusive. The proposal also allows for short-term management and procedures and creates conditions for the real application of procedural sanctions and for the property liability of persons acting in a manner contrary to its purpose. In this respect, the integration of incident disputes into the framework of insolvency proceedings is also significant. In general, however, no procedural law (though it would be more perfect) will ensure the speed and economy of management itself (already by its existence), but that such a standard merely provides (to provide) the tools that procedural bodies can use to protect law effectively and quickly. In this context, it should be noted that a number of shortcomings in today's bankruptcy proceedings lie in the application practice, in particular in the courts and administrators, who do not use or only use only part of the possibilities that the current regulation gives them. The proposed regulation also seeks to avoid these shortcomings by placing the utmost emphasis on the predictability of the actions of all the entities involved in the operation of insolvency proceedings and on the maximum degree of transparency so that it is possible for all entities to know what rights and obligations they have at the stage of insolvency proceedings. 'After all, the promoter of the draft insolvency law argued at first reading in the Chamber of Deputies in support of its adoption:" Another important element of the draft insolvency law is the emphasis on the uniformity of insolvency proceedings and the minimisation of the timeliness of the process. "
41. At first reading, the draft insolvency law contained a provision contrary to the contested provision, i.e. it enshrined both the law of denial and the creditors. After all, the insolvency law in insolvency proceedings requires that insolvency proceedings must be conducted in such a way as to achieve a rapid satisfaction of creditors [cf. § 5 (a)].
42. Moreover, in a similar sense, the contested provision is contrary to Article 6 (1) of the Convention because the requirement that everyone whose civil rights or obligations are concerned must be guaranteed the right of access to the Court (cf.
43. That finding is particularly true in situations where, by denying another creditor's claim, the creditor seeks protection not only of "ordinary 'law but of fundamental law. It follows from the case law of both the European Court of Human Rights and the Constitutional Court that the term" property' contained in the first part of Article 1 of the Additional Protocol to the Convention has an autonomous scope which is not limited to the ownership of tangible property and does not depend on formal qualifications in national law. It may include both "existing assets' and assets, including claims on which an individual may claim to have at least" legitimate expectations' to meet them. Such a legitimate expectation is, according to the case law of the European Court of Human Rights, as is the Constitutional Court [e.g. findings in cases sp. zn. Pl. ÚS 2 / 02 of 9.3.2004 (N 35 / 32 SbNU 331; 278 / 2004 Coll.), IV ÚS 525 / 02 of 11.11.2003 (N 131 / 31 SbNU 173), I. ÚS 287 / 04 of 22.11.2004 (N 174 / 35 SbNU 331), I. ÚS 344 / 04 of 15.12.2004 (N 191 / 35 SbNU 497), I. ÚS 353 / 04 of 16.6.2005 (N 124 / 37 SbNU 563)]. The contested provision is therefore consistently contrary to Article 1 of the Additional Protocol to the Convention and Article 11 (1) of the Charter (cf.
44. In view of the fact that the creditor seeks the protection of fundamental rights by denying another creditor's claim, the contested provision is also contrary to Article 4 of the Constitution according to which fundamental rights and freedoms are protected by judicial authority.
45. The contested provision of the Constitutional Court also finds it unconstitutional in the context of Article 13 of the Convention, according to which "Everyone whose rights and freedoms have been violated by this Convention must have effective remedies before the national authority, even if the infringement has been committed by persons in the performance of official duties." The contested provision precludes an effective remedy for the decision on the recognition of another creditor's claim which may, in consequence, affect the right to the protection of the assets of another creditor ["It cannot therefore be concluded that the third sentence of the contested provision is also contrary to the provision cited in the Convention '(cf. sp. zn.
46. The Constitutional Court also points to the appropriate application of the judgment of the Chamber (Fifth Section) of the European Court of Human Rights in the Kohlhofer and Minarik case against the Czech Republic (complaint No 32921 / 03, 28464 / 04 and 5344 / 05). The ECHR dealt with three complaints in this Decision. The complainants, as minority shareholders, argued that, following the entry of the resolution on the company's cancellation and transfer of capital to the main shareholder, they were not allowed to challenge neither the decision nor the capital transfer agreement. The ECHR stated in the judgment cited that the restriction of access to courts was lawful in the sense that it was governed by national law and was also legitimate in relation to the public objective (interest) pursued, which is to promote "stability in business circles by preventing abuse of remedies against the resolution '(cf. point 102 in fine). However, it also concluded that such restrictions on access to courts are disproportionate in relation to the legitimate objective pursued. The ECHR also noted that an action for damages or for the provision of reasonable satisfaction for a breach of the fundamental rights of a shareholder could not be regarded as a legal means of mitigating the effects of the provisions of Paragraph 131 (3) (c) of the Commercial Code in relation to the main subject matter of the proceedings [see e.g. the following text of the judgment cited:" 101. As regards the Government's claim that the complainants had the opportunity to defend their interests in another way, such as seeking a separate judicial review of the settlement paid by the main shareholder or bringing an action for damages or providing adequate satisfaction for the breach of the fundamental rights of the shareholder, the Court of First Instance notes that these proceedings have a different objective and deal with the separate issue of monetary satisfaction. Moreover, adequate satisfaction could only be required for a breach of the fundamental rights of the shareholder. The Government has not demonstrated that these legal means could have led to the question of the validity of the resolution in circumstances comparable to those of the review in the context of the annulment procedure. Therefore, it cannot be considered as a means of mitigating the effects of Article 131 (3) (c) of the Act in relation to the main subject matter of the procedure. Similarly, they cannot be considered as effective remedies which the complainant is obliged to apply (see paragraph 74 above), which is a question which the Court of First Instance has brought to the assessment of the merits (see paragraph 80 above)... 105. As regards the proportionality of this restriction, the Court of First Instance states that, as in the case of complaint No 32921 / 03, the Government argues that there are alternative legal means which make the restriction compatible with the Convention. The Court of First Instance further submits that, in its view, these routes were not a remedy which had to be exhausted within the meaning of Article 35 (1) of the Convention and could not adequately mitigate the damage to the rights of minority shareholders caused by the restriction (see Section 101 above). Where the third complainant's right of access to the court has been limited as a result of the action of Article 220h (4) of the Act in a similar manner as in the case of complaint No 32921 / 03, the Court of First Instance finds that the availability of alternative remedies could not meet the requirements of Article 6 (1) of the Convention in the event of a complaint. "]
47. The Constitutional Court also states in the context of comparative proceedings that, for example, under Austrian or German law, the creditor may deny the claim of another creditor (cf. § 105 Konkursordnung, § 178 Insolvenzordnung). The comparative side of this issue is also widely referred to by the appellant RWE Energie, a. s. of 24 June 2010, concluding that "the established computation shows that a country where the economic perception of legal institutes has a far longer tradition than in the Czech Republic has not followed this path, as the" Rule of Law "countries respect the constitutional dimension of creditors' rights, the principle of full jurisdiction of decisions of public authorities and want to avoid possible" hidden pressures "of certain creditors with questionable claims on administrators. At the same time, these traditional democracies can find other effective ways to prevent the excessive duration of insolvency proceedings without restricting creditor rights."
48. The above-cited conclusion on the unconstitutionality of the contested provision does not alter the fact that creditors have the possibility to claim compensation or other damage from the insolvency administrator (on the basis of § 37 of the Insolvency Act).
49. It is a different legal structure, i.e. under the responsibility of [cf. sp. zn. I. ÚS 2219 / 07 of 2.4.2008 (N 63 / 49 SbNU 3)], moreover directed towards another entity. The law and the obligation are a couple's term, the law of one entity corresponds to the obligation of the other. In the contested provision, the legislature denied the right of one creditor to deny the claim of the other creditor, even though the claim of the other creditor by that right of claim is subject to the protection of its (not only) property rights. Thus, the second creditor is the addressee of the denial. This concerns the protection of the right (primarily property) of one creditor against the wrong claim (inaccuracy of its authenticity, amount, order) of the other creditor. However, an action for damages caused by the insolvency administrator is a procedural means of protecting the right solely towards the insolvency administrator. Thus, a hypothetical successful exhaustion of an action for damages caused by the insolvency administrator would not remove the status of the incorrectly applied claim of another creditor [which can consistently mean (proportional) the satisfaction of his claim to a lesser extent and would also affect other rights of the insolvency administrator (cf. other consequences associated with the outcome of the review).]
50. Notwithstanding the fact that, despite the hypothetical later compensation, all the negative consequences of non-denial by the second creditor of wrongly applied claims would not be removed for the creditor's legal sphere (cf., or the strengthening of the influence of those creditors at the creditors' meeting and in the creditors' bodies, cf. § 49 (1) of the Insolvency Act, according to which "Unless otherwise provided for by that law, a simple majority of the votes of the creditors present or duly represented are required for the validity of the resolution, calculated according to the amount of their claims; in the case of a claim, one vote per CZK 1."). Although the creditor could later apply to the insolvency administrator requirements arising from the liability of the insolvency administrator for damages, this does not change the fact that, even if it had been complied with in this respect, it would have been possible only to rectify its property damage, but not to harm other (procedural) rights.
51. In the case of liability for damage, it is a secondary institution. However, individuals are primarily guaranteed rights and freedoms, and in order to protect and enforce them effectively, the State is obliged to provide for effective means. The creditor is therefore primarily entitled to seek the protection of his rights and freedoms as such and cannot be obliged to settle for only subsequent compensation for the breach of his rights and freedoms on the basis of the exercise of the right to compensation. This would be contrary to Article 36 (1) of the Charter. Otherwise, the rule of law would address a breach of the rights and freedoms of such a creditor. The Constitutional Court also argued that, in the decision sp. zn. The Constitutional Court also expressed its legal opinion on the requirement of subsidiarity to apply compensation to the State after the exhaustion of effective procedural means to protect the right towards tenants (cf. both available at http: / / nalus.ujud.cz). This legal opinion can be applied mutatis mutandis to the issue.
52. In the current insolvency proceedings, it is undoubtedly the interest of the participants (i.e. creditors) to achieve fair protection of their rights and legitimate interests (cf. § 1 of the Civil Code). The right of a participant is a primary interest in fulfilling the meaning and purpose (inter alia) of the insolvency proceedings, which are the provision of protection of rights under Article 90 of the Constitution, which is found to have its expression in the requirement that none of the participants be unfairly wronged or unlawfully favoured [cf. moreover, the fundamental principle of insolvency proceedings expressly enshrined in Section 5 (a) of the insolvency law]. This interest cannot be eliminated by compensation for damage, as it is a priority at all to avoid a situation where one of the participants is unfairly damaged or illegally favoured so that compensation is not needed. A party to the proceedings (including the creditor) may, however, at a later stage, apply to the insolvency administrator the requirements arising from the liability of the insolvency administrator, but this does not change the fact that even if it had been complied with in this respect, the previous situation of the infringement of its rights will not be deleted (it would only be compensated, not entirely - even if the text above were to be compared). A creditor seeking effective protection of his rights in the ongoing insolvency proceedings must be able to apply for protection within the meaning of Article 36 (1) of the Charter. [By analogy, the Constitutional Court argues in the case-law of the Court of First Instance (cf. Sp. zn. IV. ÚS 391 / 07 of 7.8.2007, N 122 / 46 SbNU 151) in relation to constitutional complaints concerning delays in proceedings pending before the General Courts - it does not reject a constitutional complaint for inadmissibility, with the possibility that, in the course of the proceedings, the requirements against the State arising from the regulation of State liability for delays within the meaning of Act No 82 / 1998 Coll., on liability for damage caused in the exercise of public authority by a decision or maladministration, and the amendment of the Act of the Czech National Council No 358 / 1992 Coll., on notaries and their activities (notary order), as amended by the Act]
53. This is all the more true because the insolvency administrator can be relieved of liability (under the conditions set out in Section 37 of the insolvency law). This instrument therefore does not offer an absolute guarantee of the payment of compensation by the insolvency administrator, and therefore cannot be an effective means of protecting the rights of the creditor.
54. The content of the right to a fair trial is also the timely provision of judicial protection, but further proceedings (on the right to compensation towards the insolvency administrator) designed as necessary would lead to a breach of this principle. Similarly, the Constitutional Court argued in the decision of the Court of First Instance in Case I-ÚS 2219 / 07 (see above), in which it examined the constitutional complaint in substance, even though the complainants were referred by the contested decision of the Court of Appeal to the need to claim their right to compensation for costs incurred by means of a separate claim for damages. In this finding, the Constitutional Court took the legal view that further legal proceedings would lead to a breach of the principle of early granting of judicial protection.
55. If the Constitutional Court, from a constitutional legal point of view, were to address the contested provision, with reference from the appellants to possible compensation by the insolvency administrator, it would address the situation of the insolvency proceedings in such a way that some of the participants would be unfairly harmed and some would be illegally favoured. As much as the property damage of the participants could then be compensated, it would not in any way eliminate the state of unlawful advantage of another participant by recognising its claim in excess of the actual situation, which would also be reflected in the greater proportional satisfaction of its claim than it actually does. The public authority must interpret legislation in such a way as to eliminate this irrational and, above all, unfair situation. The purpose of insolvency proceedings - like any civil process - is to achieve fair protection of the rights and legitimate interests of the participants, as well as education for law enforcement, for the fair performance of duties and for respect for the rights of other persons (cf. § 1 of the Civil Code).
56. For the reasons set out above, the Constitutional Court annulled the first sentence of Paragraph 192 (1), including the sentence behind the semicolon of the insolvency law, which means an unconstitutional loophole in the form of an unconstitutional narrowing of the circle of entities entitled to deny the authenticity, amount and order of the claims entered. The Constitutional Court considered it necessary to provide time for the legislator to remove the constitutional deficit of legal regulation and therefore postponed the enforceability of this finding.
57. In the remainder of the application for annulment of the provisions of § 192 (1) last sentence, § 198 (1), § 199 (1) and § 201 (1) of the Insolvency Act, the Constitutional Court rejected as manifestly unfounded, in particular because of the principle of minimising the action of the Constitutional Court in the activities of the legislator (which the Constitutional Court follows in its established case-law). These other provisions under appeal only govern the procedure for implementing the right of action, even if for an unconstitutionally narrow range of entities. After removing the above-mentioned anti-constitutional loophole by extending the scope of the holders of the law, it will be up to the legislator to consider how the procedure for implementing the creditor's right of action will be anchored (whether the legal regulation will comply with the procedure under the current legislation or a different solution will be chosen); The Constitutional Court cannot prejudge in its decision the solution to this issue.
President of the Constitutional Court:
JUDr. Rychetský v. r.
Different opinions under Section 14 of Act No. 182 / 1993 Coll., on the Constitutional Court, as amended, were taken by the Judges Vladimir Krórek, Jiří Nykodým and Miloslav Excellent to decide.
*) NB: Collection of finds and orders of the Constitutional Court, Volume 2, Order No 3, p. 201
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Regulation Information
| Citation | The Constitutional Court found No. 241 / 2010 Coll., on the application for annulment of certain provisions of Act No. 182 / 2006 Coll., on the bankruptcy and methods of its resolution (insolvency law), as amended |
|---|---|
| Regulation Type | The Constitutional Tribunal found |
| Author | - |
| Collection | Code of Laws |
| Date of Promulgation | 17.08.2010 |
|---|---|
| Effective from | - |
| Effective until | - |
| Status | Valid |
The regulation text is for informational purposes only.
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