Found No. 327 / 2020 Coll.
The Constitutional Court found of 30 June 2020 sp. zn.
Valid
The Constitutional Tribunal found
327
FIND
The Constitutional Court
On behalf of the Republic
The Constitutional Court decided under sp. zn. Pl. ÚS 40 / 18 on 30 June 2020 in plenary composed of the President of the Court of Paul Rychetský and the Judges and Judges of Louis David, Jaroslav Fenyk, Josef Fiale, Jan Filip, Jaromír Jirsa, Tomáš Lichovník (Judge of the Rapporteur), Vladimir Sládeček, Radovan Suchánek, Pavel Šámal, Katřina Šimáková, Vojtěča Šimíček, David Uhír and Jiří Zemánek, on the proposal of the Municipal Court in Prague, for which the participation in the Chamber of the Chamber of the Czech Republic, President of the Chamber of Parliament of the Senate,
as follows:
The application for annulment of Article 96 (6) of Act No. 99 / 1963 Coll., Civil Code, as amended by Act No. 296 / 2017 Coll., is rejected.
Reasons
Recital of the course of the proceedings
1. By application of Article 95 (2) of the Constitution of the Czech Republic (hereinafter referred to as "the Constitution"), in conjunction with Article 64 (3) of Act No. 182 / 1993 Coll., on the Constitutional Court, as amended, (hereinafter referred to as "the Constitutional Court"), the appellant (hereinafter referred to as "the Law on the Constitutional Court") seeks the annulment of Article 96 (6) of the Act No. 99 / 1963 Coll., the Civil Code, as effective from 30.9.2017, (hereinafter referred to as "o.s. à.), when it was inserted by Act No. 296 / 2017 Coll.
2. In the proceedings before the District Court for Prague 4 ("the District Court '), the applicant (the company Bakárna Příbram, a. s.) requested the defendant (the company Bakarna-Confectioner Hořovice, s. r. o.) to pay the rent in the amount of CZK 2 422 779,03 under the contract for the rental of immovable and movable property. By judgment of 3 May 2012 No 38C 4 / 2010-126, the District Court upheld the action and ordered the defendant to pay that amount to the applicant (operative part I) and decided to pay the costs (operative part II). The Circuit Court concluded that there was no lease agreement between the parties pursuant to § 663 et seq. of Act No. 40 / 1964 Coll., Civil Code, as amended, but the lease agreement pursuant to § 488b of Act No. 513 / 1991 Coll., Commercial Code, as amended, (hereinafter referred to as the" Obch. "). In doing so, he concluded that the contract had been valid but had not become effective since it had not been approved by the applicant's general meeting, it had not been published in the Commercial Bulletin and it had not been established in a collection of documents. Nevertheless, since its conclusion, it has been binding on the Contracting Parties, and the Court has therefore considered the action as justified.
3. On appeal of the defendant, the municipal court confirmed the decision of the district court (operative part I) and decided to pay the costs of the appeal (operative part II) by judgment of 9 January 2013 No 69 Co. The defendant has lodged an appeal against the final judgment of the Municipal Court. However, it also paid the defendant the sum.
4. By judgment of 27 October 2015 No 23 Cdo 1860 / 2013- 266 of the judgment of the Municipal Court and of the District Court, the defendant's appeal was annulled and the case was referred back to the Circuit Court for further proceedings. The reason for the annulment of the judgments of the courts of the two stages was incomplete and therefore incorrect legal assessment of the case which was contrary to the previous case-law of the Supreme Court, in that the City Court did not interpret the parties' will, whether it had actually aimed at concluding a contract for the lease of an undertaking, and misjudged the consequences of the non-disclosure of the lease agreement under Paragraph 33 (1) of the General Court's Law. (§ 488b (4) of the General Court), in that it had misjudged the consequences of the absence of written consent under § 67a general order, and, finally, when assessing whether the contract was the subject of an undertaking or part of an undertaking. The Supreme Court has concluded that, pending the entry into force of the contract, its parties do not have the rights and obligations which the contract establishes. Since the ineffectiveness of the contract can be equated to the nullity or absence of the contract, it was the duty of the court to assess, in that case, the applicant's claim for payment of the sum of money under the provisions governing entitlement to the payment of the compensation for the unjustified enrichment.
5. Subsequently, in the course of further proceedings before the Circuit Court, the defendant in the context of a procedural defence objected to the setting-up of an amount of CZK 2 737 083.10, which, on the basis of the Supreme Court's annulled judgments, he paid and which he considered to be a performance without legal justification. That amount was used by the defendant to set off only up to the amount of the applicant's claim and only in the event that any other defence would not be found justified. The applicant then withdrew the action on account of the netting. The defendant expressed her opposition by withdrawing the action because she has a legal, moral and procedural interest in having a final decision on the action.
6. The district court dealt with the withdrawal of the action from the point of view of § 96 (6) o. s. and by order of 29 June 2018 no. 38 C 4 / 2010-436 stopped the proceedings. According to the Circular, that provision does not affect the withdrawal of an action brought by the applicant, since the reason for the withdrawal of the action was not the actual payment of the amount of the defendant, which took place at the time when the effects of the annulled judgments were maintained, but the objection of counting made by the defendant only after the previous decision had been annulled. The District Court also addressed the question of whether the defendant had serious reasons to disagree with the withdrawal of an action for which the withdrawal could be declared ineffective, but did not find them and therefore terminated the procedure.
7. The defendant brought an appeal before the Municipal Court against the order of the Circular Court of 29 June 2018 No 38 C 4 / 2010-436, alleging that the basic reason for the withdrawal of the action was not to set off the claims, but that the applicant had already received the amount from the defendant. However, such remuneration took place at a time when the effects of the judgments cited by the final and enforceable judgments of the Circular Court and the Municipal Court and the subsequent offsetting could not have led to the end of the existing liability. The defendant considers that the withdrawal of the application made by the applicant is not effective and requests that the procedure be terminated.
8. In this procedural situation, the City Court of Appeal suspended the appeal proceedings and referred the case, pursuant to Article 95 (2) of the Constitution, to the Constitutional Court for an application for annulment of § 96 (6) o. s. s.
Recap the content of the proposal
9. The appellant states in the proposal that, in the present procedural situation, it must deal with the application of Paragraph 96 (6) (c) of the Rules of Procedure. Following the annulment of the final judgment of the Municipal Court and of the Circular Court, in a situation where the defendant carried out, on the basis of such a final (and enforceable) judgment, the claimant in the meantime, the claim for performance by the action may no longer be successful. Either the undertaking has ceased to be fulfilled by the defendant and no longer exists, or the claimant had no claim against the defendant at all, and therefore the action for performance of the contract cannot be justified. Both situations lead to the trial being dismissed.
10. However, the contested provision does not allow the applicant to take the action back effectively in the procedural situation. If the defendant seeks to recover the performance provided (which he has given pursuant to a final judgment which has subsequently been annulled) and the claimant does not return the performance, he shall have the right to claim the alleged unjust enrichment before the court (by a separate action or by mutual action, if necessary). However, there is no reason for the court in the pending proceedings on the applicant's claim (otherwise) to deal with the issue of unfounded enrichment, which has no influence and significance for the statement in the action brought by the applicant. The relevant importance of the assessment (not) of the merits of the claim is not even an objection to the setting-up of any entitlement of the defendant to an unjustified enrichment.
11. Paragraph 96 (6) of the EC Treaty therefore obliges the claimant to lead the proceedings to a final, meritorious, negative decision, without any meaningful basis, limiting the applicant's discretion with an action on which civil proceedings are based in a democratic legal state. The contested provision in the proceedings concerning the applicant's claim does not provide for any protection of the defendant's rights in view of the possible issue of unjustified enrichment, even if such entitlement is justified. Nor does it remove the problems in which the defendant fulfils the final judgment which is subsequently annulled in the appeal proceedings.
12. The appellant concludes that Paragraph 96 (6) CS cannot be interpreted in a constitutional manner which would be consistent with the nature of civil proceedings and the principles of the democratic rule of law, and that it took care of the rights of the applicant with the action and its right (not by force) to exercise the rights by judicial means [Article 36 (1) of the Charter of Fundamental Rights and Freedoms (hereinafter referred to as the "Charter")], since the opposite interpretation allowing the action to be withdrawn (even with the consent of the defendant) would always be contrary to this legal provision in view of the dictation of the provision cited. Paragraph 96 (6) CS also infringes the right to own property (Article 11 of the Charter), since, as a result, it obliges the applicant to pay the costs of the proceedings of a counterparty which will always succeed in such proceedings (cf. § 142 (1) RS, p.
Text of the contested provision
13. Paragraph 96 (6) of the Rules of Procedure reads: "If the application to initiate proceedings was withdrawn only after the decision of the Court of Appeal and, where appropriate, the Court of First Instance has annulled the case, the court shall decide that the withdrawal of the application is not effective if the reason for the withdrawal of the application was a fact which occurred at the time when the effects of the annulled decision lasted."
Recital of the observations of the parties and the intervener
14. Pursuant to Articles 42 (4) and 69 (1) of the Law on the Constitutional Court, the Constitutional Court sent a motion for the annulment of the contested provision to the Chamber of Deputies of the Parliament of the Czech Republic ("the Chamber of Deputies') and the Senate of the Parliament of the Czech Republic (" the Senate ') as parties to the proceedings and to the Government and the Ombudsman, who are entitled to intervene as interveners.
15. In its observations of 16 January 2019, the Chamber of Deputies limited itself to a description of the course of the legislative process which led to the adoption of Act No. 296 / 2017 Coll., amending Act No. 99 / 1963 Coll., the Civil Code, as amended, Act No. 292 / 2013 Coll., on Special Proceedings, as amended, and certain other laws ("Act No. 296 / 2017 Coll. '), which include a provision which is proposed for annulment. To this end, it states that the law was passed by the necessary majority of Members of the Chamber of Deputies, signed by constitutional officials and duly declared. It leaves it to the Constitutional Court to assess its constitutionality.
16. In its observations of 29.1.2019, the Senate also refers only to a description of the course of the legislative process, with the fact that Act No. 296 / 2017 Coll., including the contested provision, was adopted by the Senate within the limits of the Constitution established competence and in a constitutional manner. The assessment of the constitutionality of the contested provision also leaves it to the Constitutional Court.
17. The Government of the Czech Republic did not exercise its right to intervene.
18. The Ombudsman stated that, pursuant to Paragraph 69 (3) of the Constitutional Court Act, she did not intervene in the proceedings.
19. The Constitutional Court sent the observations of the parties to the appellant in the light of a possible reply, but he did not consider it necessary to react more closely in view of the content of the observations of the parties.
Abandonment of oral proceedings
20. The Constitutional Court noted that further clarification cannot be expected from oral proceedings and therefore, in accordance with Article 44 of the Constitutional Court Act, it decided without holding oral proceedings.
Assessment of the active legitimacy to submit a proposal
21. Pursuant to Article 95 (2) of the Constitution, if the court concludes that the law to be applied in the resolution of the case is contrary to constitutional order, it shall bring the matter before the Constitutional Court. It is further specified in Section 64 (3) of the Constitutional Court Act, according to which the Constitutional Court may file an application for annulment of the law or its individual provisions. The Court of First Instance has the active legitimacy to bring an application for annulment of the law or its provisions pursuant to Article 95 (2) The Constitution of the General Court, when it concludes that the law to be applied in the resolution of the case is contrary to the constitutional order, the so-called incident case requires its real application, not just its hypothetical use or just some other broader connection to the case before the General Court.
22. The Constitutional Court found this condition to be fulfilled, since the municipal court in the proceedings on which its application is based must, by reason of the withdrawal of the action by the applicant, apply Paragraph 96 (6) (a) of the Rules of Procedure, following the annulment of the previous final decisions under which the defendant was served.
Constitutional conformity of the legislative process of adopting the contested provision
23. The Constitutional Court is required, in accordance with Article 68 (2) of the Law on the Constitutional Court, as amended by Act No. 48 / 2002 Coll., in the procedure for the control of standards, to assess whether the contested law (its individual provision) has been adopted and issued within the limits of the Constitution established competence and in a constitutional manner.
24. It was found from the observations of the parties as well as from the House of Prints that Law No 296 / 2017 Coll. was submitted by the Government of the Chamber of Deputies in the 7th parliamentary term, such as Press 987. The first reading took place at the 55th meeting of 3. 3. 2017, in which he was ordered to discuss the guarantee constitutional legal committee. The Constitutional Law Committee discussed the draft law and issued a resolution on 20 April 2017 with amendments to the amendments delivered to Members as press 987 / 2, including the contested provision. The second reading took place at the 57th meeting of 26 May 2017, all the amendments tabled being processed as press 987 / 3. On 31 May 2017, the Constitutional Legal Committee issued a resolution by the Guarantee Committee with a proposal for a third reading voting procedure and its opinions on all amendments tabled such as Press 987 / 4. The following third reading was on the agenda of the 59th meeting of the Chamber of Deputies on 12 July 2017. Of the 147 Members applied for, 104 were opposed to the bill, 2 were opposed.
25. On 24 July 2017, the bill was delivered to the Senate, where it was assigned a press number 175 in the Senate record of the 11th term. The Constitutional (Guarantee) Committee discussed it on 9 August 2017 (Resolution No 71, Senate Document No 175 / 1) and recommended to be approved as referred to the Chamber of Deputies. The Senate dealt with the bill at its 9th session, where it was approved by Resolution 260 of 16 August 2017 in the version referred to by the Chamber of Deputies when, in vote 23 of the 71 Senators present, 49 senators voted in favour and none opposed. After signature by the relevant constitutional authorities, the law was subsequently declared in the Collection of Laws.
26. The Constitutional Court therefore notes that Law No. 296 / 2017 Coll. was adopted by a constitutional procedure, signed by the relevant constitutional authorities and duly declared.
Self-assessment of the proposal
27. The appellant relies on his application to abolish the provision in question on the limitation of the applicant's right of disposal, which confers on that right the nature of the fundamental right. The fundamental principles of court proceedings are enshrined at constitutional level in the title of the fourth Constitution and in the title of the fifth Charter of Fundamental Rights and Freedoms. These include, in particular, the equality of participants, mouth, public or the principle of a legal judge. However, none of the articles of the Constitution or of the Charter anchor the disposition principle as part of the fundamental rights. The procedural rules of the proceedings before the court to ensure the right to a fair trial are left to the discretion of the legislator (Article 90 of the Constitution, Article 36 (4) of the Charter).
28. The case under examination concerns the procedural rules laid down in the Civil Code. The appellant may agree that the disposing principle is one of the principles of the contested procedure. However, the principle of legal (not constitutional), even in the contested procedure, is not consistently followed. For example, pursuant to § 96 (3) CS, the court does not have to admit the withdrawal of an action, nor do it have to allow a change of action (§ 95 (2) CS). Contrary to the contested procedure, the principle of official competence and not of disposition is mainly governed by the undisputed procedure. At the same time, even in an undisputed procedure, relations governed by substantive private law (e.g. family, inheritance, etc.) are discussed.
29. "To raise" the disposition principle from the legal to constitutional level cannot be done by considering respect for the autonomy of the will. This is private law for the substantive but not for the procedural law, which is public law. Moreover, as provided for in Article 2 (4) of the Constitution and Article 2 (3) of the Charter, the law may restrict free conduct. The legal regulation of its rules, as provided for in Article 36 (4) of the Charter, is a necessary condition for legal proceedings.
30. Respect for the autonomy of the will makes it possible for everyone to make a free decision whether to bring their dispute to judgment. If they do so, they must submit to a legally regulated process and be prepared to bear the consequences. The trial is not just about the plaintiff, but also about the defendant. Article 96 (1) of the Constitution and Article 37 (3) of the Charter establish the equality of the parties before the courts. It is precisely the duty of the State to ensure the right to judicial protection and the right to a fair trial by both (equal) parties to the litigation that it is necessary to comply with the legal rules, conditions and rules of procedure in its details, as provided for in Article 36 (4) of the Charter, which implies that the legislature's powers to determine the conditions (i.e. whether and when protection can be sought before the court) and the details (how).
31. The constitutional bases of the legal proceedings are precisely set out in order to assess the constitutionality of the contested provision. The contractual arrangements are not decisive for the mutual rights and obligations of the parties to the legal proceedings, but the rules to ensure that the purpose is achieved, that is, why the judicial proceedings have been initiated and what is being followed by the submission of the application. By bringing an action against the applicant, the defendant shall be heard by the defendant. He is a party to the dispute generally against his will, which is certainly contrary to the requirement of respect for the autonomy of the individual's will. Both the Court of Appeal and the Court of Appeal shall rule in favour of the plaintiff and the defendant shall, on the basis of a final judgment, be obliged to fulfil (alleged or existing) the debt. Subsequently, a favourable decision by the court of appeal is annulled for the applicant and the case is referred back to the court of appeal or to the court of appeal. In a situation where the applicant has already achieved his or her job and could only lose in the ongoing proceedings, it is very advantageous for him to withdraw the action and reach a termination. It would then be a matter for the defendant, who was "brought 'by the applicant to be active and to start a new trial at his own expense and risk, before another judge or, where appropriate, another court.
32. It cannot be concluded from the Charter that the right of the applicant to terminate the legal proceedings may be included in the fundamental rights and freedoms at the moment when it is of the utmost benefit to him and for the defendant to the minimum benefit. Since the applicant does not have such a fundamental right, it is up to the legislator to protect the rights of the defendant. The defendant, who has become a party to the dispute against his will (ex, pursuant to Article 90 of the EC Treaty), who, according to the Constitution, is of equal standing before the Court of First Instance and who no longer fully voluntarily has complied with the judgment which has just been annulled. If the legislator has chosen the solution contained in the current version of Paragraph 96 (6) (a) and has not relied on the prudent application of Paragraph 96 (3) (a), it may be disputed by the value of such a solution, but cannot be called unconstitutional or totally inappropriate.
33. The contested provision makes it possible, once the case has been referred back to a lower degree court (the court of appeal), to proceed with the proceedings, irrespective of the fact that the defendant has complied with the applicant. The Court of First Instance may rely on evidence already produced and shall only carry out such evidence as the need for which results from the decision of appeal. On the basis of the evidence before him, and based on the legal opinion of the Court of Appeal (which is binding only on this particular case), the court shall re-rule on the action. Hardly any other way than to dismiss the suit. In the first case, because it will be shown that the action was unfounded (the applicant did not have a claim). In the second case, since the Court of First Instance again concluded that the action was justified on the contrary, but it is prevented from complying with the earlier performance of the defendant and on this basis the claim claimed was satisfied. In both cases, however, it will be applied as a matter of principle that the statement on the grounds constitutes an integral unity, which is why the judgment in the first case (the second need not be dealt with) constitutes a complete prejudication (see § 135 (2), § 159a (1) o. s.). If the claimant does not voluntarily issue the performance received, it shall be sufficient to provide evidence in the proceedings for the issue of an unjustified enrichment by judgment of the original dispute. Thus, the need for a "real 'dispute over unfounded enrichment, which would have to take place if the proceedings were terminated after the annulment of the action. Such proceedings would have to be conducted - in relation to the original proceedings - again with all due regard, since the evidence previously made could not be transferred to the new proceedings but would have to be carried out again. Nor does the appellant's objection to the costs of the proceedings stand. It should be decided according to success in the matter. In the first case, the defendant would be successful. In the latter case, the applicant's success is mediated by the judgment on" success' of the applicant's claim. Denying an action for the defendant's performance does not change that. In a situation where the defendant is not interested in further proceedings, a departure from the special rule laid down in Paragraph 96 (6) of the Rules of Procedure may be made to the general rule laid down in Paragraph 96 (3) of the Rules of Procedure.
Conclusion
34. The Constitutional Court concludes, in the light of the foregoing, that the regulation contained in Paragraph 96 (6) of the EC Treaty does not affect the fundamental rights of the parties and does not conflict with the constitutional order. The Constitutional Court thus found no grounds for the annulment of the contested provision and therefore rejected the proposal under Paragraph 70 (2) of the Constitutional Court Act.
President of the Constitutional Court:
JUDr. Rychetský v. r.
In accordance with Article 14 of Act No. 182 / 1993 Coll., on the Constitutional Court, as amended, Judge Ludvík David, Jaromír Jirsa, Kateřina Šimáková, Vojtěch Šiměl and Jiří Zemánek took a different position.
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Regulation Information
| Citation | Findings No. 327 / 2020 Coll., on the application for annulment of § 96 paragraph 6 of Act No. 99 / 1963 Coll., Civil Code, as amended by Act No. 296 / 2017 Coll. |
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| Regulation Type | The Constitutional Tribunal found |
| Author | - |
| Collection | Code of Laws |
| Date of Promulgation | 29.07.2020 |
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| Effective from | - |
| Effective until | - |
| Status | Valid |
Legal Areas:
Civil law
Civil law of procedure
The regulation text is for informational purposes only.
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