Latvia / The Constitutional Court of the Republic of Latvia

“WINNER” limited liability company under liquidation vs. Republic of Latvia
Deciding body type
National Court/Tribunal
Deciding body
The Constitutional Court of the Republic of Latvia
Type
Decision
Decision date
23/02/2022
  • Latvia / The Constitutional Court of the Republic of Latvia

    Key facts of the case:

     

    “WINNER”, the applicant company, was a limited liability company factually on the state of liquidation, however, not yet under official insolvency procedure. In the course of factual liquidation an auction was held to sell the immovable property owned by the applicant company. According to the case file, a sworn bailiff lodged a claim before first- instance court, for the approval of the statement of auction regarding the immovable property previously owned by the applicant company and corroboration of the title to property in the acquirer’s name. Following that, the acquirer of the immovable property requested the court to be put in the possession of the acquired property. The first-instance court granted the request. The applicant company lodged an ancillary complaint regarding this decision. In order to proceed with the ancillary complaint according to Article 444 of the Civil Procedure Law the applicant of an ancillary complaint must pay a security deposit., The applicant company therefore further requested to be exempted from paying the security deposit on the ground that the applicant company had been experiencing financial difficulties and lacked the necessary resources for paying the security deposit. Furthermore, its economic activities had been suspended by a State Revenue Service’s decision. The first-instance court dismissed the applicant company’s request on the basis of the contested norm as this norm does not provide that a legal person governed by private law, which is experiencing financial difficulties, could be exempted from the duty of paying the security deposit upon submitting an ancillary complaint.  

    Article 43(2) of the Civil Procedure Law exempts from paying security deposit only natural persons, not legal persons. The applicant company complained before the Constitutional Court arguing that this regulation leads to  breach of the rights to fair trial as provided by Article 92 of the Constitution. The Constitutional Court held that Article 4441 of the Civil Procedure Law is not compatible with Article 92 of the Constitution as long as it does not envisage the right to claim exemption from the obligation to pay security deposit also to a legal person, as lack of such right is in breach of the right to a fair trial as it precludes access to the courts private legal persons lacking financial resources, but not yet under official insolvency procedure.   

    Key legal question raised by the Court:

    Right to fair trial, right to effective remedy for private legal persons.

    Outcome of the case:

    The Constitutional Court held that Article 444 and Article 43 of the Civil Procedure Law is not compatible with Article 92 of the Constitution as long as it does not envisage the right to claim exemption from the obligation to pay security deposit also to a legal person, because lack of such right is in breach of the right to a fair trial as it precludes access to the courts private legal persons lacking financial resources, but not yet under official insolvency procedure.

  • Paragraphs referring to EU Charter

    10.2. Latvia, being aware of the supremacy of European Union law, included in the second part of Article 68 of the Constitution, and in adopting and applying the national legal norms, must take into account the legal acts of the European Union that reinforce democracy and the interpretation thereof, consolidated in the case law of the Court of Justice of the European Union (compare, see, Judgement of the Constitutional Court of 6 March 2019 in Case No. 2018-11-01, para. 16.2.). Pursuant to Article 6(1) of the Treaty on European Union, the European Union recognises the rights, freedoms and principles set out in the Charter of Fundamental Rights of the European Union (hereafter: the Charter), and the Charter has the same legal value as the Treaty on the European Union. The Constitutional Court recognised that, substantially, also the general legal principles of the European Union are included in the Charter (see Judgement of the Constitutional Court of 13 November 2021 in Case No.2018-18- 01, para. 15.2.1.). The first and the second paragraph of Article 47 of the Charter provide that everyone whose rights and freedoms guaranteed by the law of the Union have been violated has the right to an effective remedy, in compliance with the conditions laid down in this Article. Everyone is entitled to a fair and public hearing within a reasonable time by and independent and impartial tribunal previously established by law. Everyone has the possibility of being advised, defended and represented. Pursuant to the third paragraph of Article 47 of the Charter, legal aid is made available to those who lack sufficient resources insofar as such aid is necessary to ensure effective access to justice. Effective legal remedies before a court are a general legal principle of the European Union, which is founded on the shared constitutional traditions of the Member States, as well as on Article 6 and Article 13 of the [European Convention on Human Rights and Fundamental Freedoms]. The said principle applies also to the Member States when they implement the legal acts of the European Union. Pursuant to the third paragraph of Article 47 of the Charter, which is an element in defining the principle of effective legal remedies, persons should be provided legal aid in cases, where the lack of such aid would deny them the possibility to exercise the right of having one’s case heard in a court (see: Explanation relating to Article 47 – Right to an effective remedy and a fair trial. Explanations relating to the Charter of Fundamental Rights of the European Union of 14 December 2007 by the Convention which drafted the European Charter of Fundamental Rights (2007/C303/02)). It follows from the case law of the Court of Justice of the European Union that the right to legal aid comprises further an exemption from paying the costs of legal proceedings and it may be applied also to a legal person governed by private law (see Judgement of the Court of Justice of the European Union of 22 December 2010 in Case C-279/09 DEB Deutsche Energiehandels-und Beratungsgesellschaft mbH, para. 59). Thus, in the areas to which the European Union law applies, the principle of effective legal remedies, specified in the third paragraph of Article 47 of the Charter, is applicable also to a legal person governed by private law. 

  • Paragraphs referring to EU Charter (original language)

    10.2.Latvijai, apzinoties Satversmes 68.panta otrajā daļā ietverto Eiropas Savienības tiesību pārākumu un pieņemot un piemērojot nacionālās tiesību normas, ir jāņem vērā demokrātiju stiprinoši Eiropas Savienības tiesību akti un Eiropas Savienības Tiesas judikatūrā nostiprinātā to interpretācija (sal. sk. Satversmes tiesas 2019.gada 6.marta sprieduma lietā Nr.2018-11-0116 2.punktu). Atbilstoši Līguma par Eiropas Savienību 6.panta 1.punktam Eiropas Savienība atzīst tiesības, brīvības un principus, kas izklāstīti Eiropas Savienības Pamattiesību hartā (turpmāk–Harta), un Hartai ir tāds pats spēks kā Līgumam par Eiropas Savienību un Līgumam par Eiropas Savienības darbību. Satversmes tiesa ir atzinusi, ka Hartā pēc būtības ir ietverti arī Eiropas Savienības vispārējie tiesību principi (sk. Satversmes tiesas 2021.gada 13.novembra sprieduma lietāNr.2018-18-0115. 2.1.punktu). Hartas 47.panta pirmajā un otrajā daļā noteikts, ka ikvienai personai, kuras tiesības un brīvības, kas garantētas Savienības tiesībās, tikušas pārkāptas, ir tiesības uz efektīvu tiesību aizsardzību, ievērojot nosacījumus, kuri paredzēti šajā pantā. Ikvienai personai ir tiesības uz taisnīgu, atklātu un laikus veiktu lietas izskatīšanu neatkarīgā un objektīvā, tiesību aktos noteiktā tiesā. Ikvienai personai ir iespējas saņemt konsultāciju, aizstāvību un pārstāvību. Atbilstoši Hartas 47.panta trešajai daļai juridiskā palīdzība tiek sniegta tiem, kam nav pietiekamu finanšu līdzekļu, ciktāl šī palīdzība ir nepieciešama, lai nodrošinātu efektīvu tiesiskuma īstenošanu. Efektīva tiesību aizsardzība tiesā ir vispārējs Eiropas Savienības tiesību princips, kas pamatots dalībvalstu kopīgās konstitucionālajās tradīcijās, kā arī Konvencijas 6.un13.pantā. Minētais princips attiecas arī uz dalībvalstīm, tām īstenojot Eiropas Savienības tiesību aktus. Atbilstoši Hartas 47.panta trešajai daļai, kas ir efektīvas tiesību aizsardzības principa konkretizācijas elements, personai būtu jānodrošina juridiskā palīdzība gadījumos, kad šādas palīdzības trūkums varētu tai liegt iespēju īstenot tiesības uz lietas izskatīšanu tiesā(sk.: Paskaidrojums par 47.pantu –Tiesības uz efektīvu tiesību aizsardzību un taisnīgu tiesu. Eiropas Savienības Pamattiesību hartu izstrādājušā Konventa 2007.gada 14.decembra Paskaidrojumi (2007/C303/02) attiecībā uz Pamattiesību hartu). No Eiropas Savienības Tiesas judikatūras izriet, ka tiesības uz juridisko palīdzību ietver arī atbrīvojumu no tiesāšanās izdevumu samaksas un tās var tikt attiecinātas arī uz privāto tiesību juridisko personu (sk. Eiropas Savienības Tiesas 2010.gada 22.decembra sprieduma lietāC-279/09 „DEB Deutsche Energiehandels-und Beratungsgesellschaft mbH” 59.punktu). Tātad jomās, uz kurām attiecas Eiropas Savienības tiesības, Hartas 47.panta trešajā daļā konkretizētais efektīvas tiesību aizsardzības princips ir attiecināms uz privāto tiesību juridisko personu.