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Hungary (2009)

 
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  • INTRODUCTION (History, purpose of the review and classification of administrative acts, definition of an administrative authority)

    • 1. Main dates in the evolution of the review of administrative acts

      The „October Diploma” – an Habsburg imperial decree allowing Hungary independence in internal affairs – proved a structural reform of judiciary. The Royal Hungarian Curia regained its lawful powers and reputation. First, as separated public law court the Royal Financial Court was established in 1883. Later the Act XXVI of 1896 set up a single-instance special court, the Royal Administrative Court which incorporated the Financial Court too. It adjudged both general and financial cases in non litigation process. Following the extension of the powers of public law courts was created the Court of Competence to settle disputes of competence between ordinary, administrative courts or authorities of public administration.

      After The Second World War traditional formalised law was applied in usual cases of civil and administrative law, but in the area of the administrative law there was no place for courts anymore. Hungary turned from a liberated country into a newly occupied one, where the Communist (later Socialist) Party controlled the administration. The introduction of the reforms in the seventies and eighties set in motion some irrevocable changes. Ordinary courts got the competence to review more than twenty kind of administrative cases (taxes, land registry) in non litigation process. Law and jurisdiction became more liberal.

      The change of the regime of 1989-90 created the rule of law in Hungary and gave rise to a gradually evolving reform in judiciary. As first step the Constitutional Court annulled the decree which restricted the scope of the disputable decisions. Act XXVI of 1991 ensures the possibility of judicial revision in every cases. In Hungary, legal practice takes place in a unified system of jurisdiction which have for levels: town, county courts, courts of Appeal, Supreme Court. Administrative cases are arranged on the labour courts (first level in social insurance issues), county courts (general first level) on the Budapest Court of Appeal (in important cases – 10% of all issues -second instance) Supreme Court (extraordinary remedy)

    • 2. Purpose of the review of administrative acts

      Judicial review is available to natural and legal persons in respects of administrative acts that directly affect their rights or interests. According to the „uniformity decision” of the Hungarian Supreme Court associations formed by the citizens for the representation of their environmental interests and other social organisations – which are active in the impact area – shall be entitled in their area to the legal status of being a party in environmental cases. Newly the Convention of Aarhus ensures the position of a party without any subjective affected rights or interests. „Good functioning” of the administration has a great importance where the local government would have no control outside because of the lack of a higher level authority. Here can the County Administrative Office ask for a review without to be affected by the case.

    • 3. Definition of an administrative authority

      Act CXL of 2004 on the General Rules of Administrative Proceedings and Services (hereinafter: Act on Administrative Proceedings) enlists those organs that shall be regarded administrative authorities vested with jurisdiction to carry out administrative actions: state organs, the councils of representatives of local governments, chief notaries, notaries (district-notaries), offices of the councils of representatives, heads of the regional branches of cities of county rank, official administrative associations and other organisations, bodies or persons vested with administrative competence by an Act or Government Decree. If other organisations, public bodies or persons not originally established for administrative services are vested subsequently with administrative competence by an Act or Government Decree, cases that are to be governed by the provisions of the Act on Administrative Proceedings shall be determined.

      The tax authority (state tax authority, municipal tax authority and customs authority) is to be regarded a state organ, whose proceedings are governed by Act XCII of 2003 on the Rules of Taxation (hereinafter: Act on Taxation).

      The general rules of administrative proceedings are laid down in the Act on Administrative Proceedings and in the Act on Taxation but other acts may also contain provisions relating to administrative proceedings in special cases. (e.g. Act 57 of 1996 on the Prohibition of Unfair Trading Practices and Unfair Competition and Act 123 of 2003 on Public Procurement)

    • 4. Classification of administrative acts

      According to the Act on Administrative Proceedings administrative actions shall mean:
      a) all actions where the administrative authority defines any right or obligation concerning a client, verifies any data, fact or entitlement, maintains official records and registers or conducts a regulatory inspection;
      b) procedures for admission into and removal from the register for engaging in activities, where engaging in a specific profession is rendered subject to membership in a public body or other organisation of the like, not including disciplinary and ethics proceedings.

      The concept of administrative action relating to taxation is defined by the Act on Taxation as actions involving:
      a) mandatory payments related to taxes, contributions, duties, payable pursuant to law to the central budget, extra-budgetary funds, to the Pension Insurance Fund, Health Insurance Fund or to local self-governments,
      b) subsidies paid from the central budget or from extra-budgetary funds under the conditions set forth in an act of Parliament, in government or ministerial decrees,
      c) procedures related to such payments and budgetary subsidies, if the assessment, collection, execution, refund, disbursement or control of such falls within the competence of the tax authority.

      The Act on Administrative Proceedings regulates administrative agreement between administrative authorities and parties. If the administrative authority fails to fulfil the administrative agreement as agreed and fails to comply with the client’s notice requiring performance, the client may seek remedy at the court of jurisdiction for administrative actions. If either of the parties don’t approve the amendment of the administrative agreement, or there is a disagreement between the parties as regards the legal background of the amendment, the court of jurisdiction for administrative actions may be requested to amend or terminate the agreement.

      In situations of refusal to act or an omission to do so in cases where the administrative authorities are under an obligation to implement a procedure following a request, the court is entitled to oblige the authority to exercise its competence.

  • I – ORGANIZATION AND ROLE OF THE BODIES, COMPETENT TO REVIEW ADMINISTRATIVE ACTS

    • A. COMPETENT BODIES

      • 5. Non-judicial bodies competent to review administrative acts

        As a main rule there is a right to appeal in administrative procedures. Higher level authorities that have competence to examine appeals are enlisted by the Administrative Proceedings Act, the Act on Taxation and other acts.

      • 6. Organization of the court system and courts competent to hear disputes concerning acts of administration

        The judicial review of administrative actions is governed by Chapter 20 of Act 3 of 1952 on Civil Procedure (hereinafter: Code of Civil Procedure), there is no special code for the judicial review of administrative actions.

        Tribunals are not entitled to hear administrative cases. The county courts and the Municipal Court of Budapest are competent to hear administrative cases but the Municipal Court has exclusive competence in certain matters, mainly in cases where the first instance authority has competence for the whole country (issues of ministries, media cases, public procurement and competition cases, asylum cases).

        As a main rule there is no possibility to appeal against the decision of the county court or the Municipal Court acting as a court of first instance. Decisions taken at first instance, therefore, shall be regarded as final decisions concerning which an extraordinary remedy may be requested from the Supreme Court. There is a possibility for ordinary appeal only if there is no possibility of appeal within the administrative procedure and the administrative decision can be modified by the court. Such ordinary appeals are examined by the Regional (Appellate) Court of Budapest. The Regional Court of Budapest has a special function because it examines not only appeals but functions as a first-instance court as well and in this capacity it takes non- contestable decisions. (e.g. it examines the clash of competence between administrative authorities, reviews administrative agreements etc.)

        The judicial review of administrative decisions concerning social insurance falls within the scope of powers of labour courts, which proceed according to Chapter 20 of the Code of Civil Procedure.

        The Supreme Court is the highest judicial body. It reviews final decisions if these are challenged through an extraordinary remedy. It adopts uniformity decisions and thereby provides judicial guidance to lower courts, and examines appeals lodged against the decisions of the county courts and the Municipal Court of Budapest in cases established by law.

        A Hungarian judge can hear administrative cases only if (s)he is assigned to the list of administrative judges. That means that (s)he can hear administrative cases but is not denied to hear civil cases either.

        The Constitutional Court is not part of the ordinary court system. It reviews the constitutionality of normative acts passed by public authorities (e.g. bills of Parliament, rules of local governments). Ordinary judges may initiate ex post review if they think that the law to be applied in a given case is unconstitutional. The Constitutional Court examines acts also from the aspect of compatibility with international treaties.

    • B. RULES GOVERNING THE COMPETENT BODIES

    • C. INTERNAL ORGANIZATION AND COMPOSITION OF THE COMPETENT BODIES

      • 9. Internal organization of the ordinary courts competent to review administrative acts

        First instance – county courts: if there are at least 12 administrative judges at the court they comprise a separate division for administrative law. If there are less than 12 people they are members of a common division of civil and administrative law. Administrative divisions discuss practical issues and they regularly have official sessions. The division gives a non-binding opinion about applicants for administrative judgeship. Administrative divisions are to be found only at the Municipal Court of Budapest, the Regional Court of Budapest and the Supreme Court, within which judges and panels are specialised in certain types of cases.

        Administrative judges at first instance examine their cases as single judges. If the judge assesses the case too difficult, or the case is a significant one (s)he can ask for a three-judge panel, which has to accept the initiation of the single judge.

        The Budapest Court of Appeal and Supreme Court: Three-judge panels deal with the case, one of them reports the case and if there is a hearing, the head of the panel leads it. There is a formal vote for the judgement, where the youngest judge votes first, and the head of the panel last. The minority opinion can be enclosed to the case for the higher level court, which can take it into account at the second instance or in case of an extraordinary revision.

        The judicial review of administrative cases concerning social insurance is carried out by labour courts. Labour courts are not part of administrative divisions but their proceeding is also governed by Act 20 of the Code of Civil Procedure.

      • 10. Internal organization of the administrative courts

        ./.

    • D. JUDGES

    • E. ROLE OF THE COMPETENT BODIES

      • 16. Available kinds of recourse against administrative acts

        As a main rule the court can review administrative final decisions taken on the merits of the case in a litigious proceeding. The court shall proceed on the basis of the request that includes the alleged violation of law. In exceptional cases decisions (resolutions) taken by the administrative authority on procedural issues (e.g. suspension or termination of the proceeding, imposition of a fine) can also be reviewed where they can be appealed during the administrative proceeding. Resolutions shall also be reviewed by the court if they were adopted by a minister, the head of an autonomous government body, or other similar government agency, the head of central government body, or if no appeal is permitted by law against the decision of the first instance in the case in question, and it allows for the judicial review of that decision. In this case the review shall be carried out upon claim in non-litigious proceedings. If the law does not permit an appeal against the resolution, the client may challenge the lawfulness of procedures within the claim against the decision on the merits of the case (e.g. resolutions of tax authorities shall not be subjected to judicial review).

        As a main rule judicial review of a final decision can only take place if one of the parties involved in the administrative procedure has exhausted the right of appeal or law excludes the possibility of appeal (e.g. the court shall review only the final decision taken by the tax authority of second instance).

        The administrative court – upon the claim of the party (on issues requested by the party), in a litigious or non-litigious procedure – has to examine whether the administrative decision is lawful or not. The judgement of the court shall be governed by facts that existed and law that was in force when the administrative decision was taken. Unlawfulness may be established in procedural or substantive issues, infringement of procedural law may, however, lead to the annulment of an administrative decision only if it bears on the merits of the case and cannot be remedied within the procedure at the court.

        As a main rule the administrative court – in case there is an infringement of law bearing on the merits of the case – annuls the decision and if needed obliges the administrative authority to carry out a new procedure, for which the court lays down obligatory requirements. In certain cases the court may also modify the decision of the administrative authority – these cases are enlisted in the Code of Civil Procedure (e.g. taxation, public procurement, real estates etc.) The administrative court is entitled to review appeals against decisions taken in discretionary powers.

        If the administrative authority fails to execute its vested authority in a non- litigious proceeding the court shall, at the client’s request, order the authority to conclude the procedure.

        If the administrative authority fails to fulfil the administrative agreement as agreed and fails to comply with the client’s notice requiring performance, the client may seek remedy at the court of jurisdiction for administrative actions. If either of the parties don’t approve the amendment of the administrative agreement, or there is a disagreement between the parties as regards the legal background of the amendment, the court of jurisdiction for administrative actions may be requested to amend or terminate the agreement.

        Claims for damages for harmful administrative acts, are exclusively heard by civil law judges.

      • 17. Existence of mechanisms for the delivery of a preliminary ruling apart from the procedure under the Article 234 of the EC Treaty

        The Constitutional court has competence to examine the constitutionality of the law, which is applicable in an administrative review case. The administrative judge suspends the case and asks the examination of the Constitutional Court.

        That is the way at the unconstitutionality of municipal regulations too. If the regulation is annulled by the Constitutional Court it can’t be applied in the concrete case.

      • 18. Advisory functions of the competent bodies

        All bills and drafts of government decrees should be referred to the Supreme Court to report on if they touch upon the jurisdiction of the courts. The Supreme Court gives expert opinion, as representative of the Supreme Court some judges take part in the work of codification committees.

      • 19. Organization of the judicial and advisory functions of the competent bodies

        These opinions belong to the activity of the Supreme Court, and not to the individual judge.

    • F. ALLOCATION OF DUTIES AND RELATIONSHIP BETWEEN THE COMPETENT BODIES

      • 20. Role of the supreme courts in ensuring the uniform application and interpretation of law

        The Supreme Court has several means to ensure uniform application and interpretation of law. If there is a divergence in the case law or between lower courts, the president of the Supreme Court, the leader of the administrative division of the Supreme Court, or the head of the panel in the Supreme Court can bring in action a special procedure for the unification of the law. The judgement which is binding to the courts is passed by an extended panel of five or seven judges. The Administrative Division of the Supreme Court adopts non-binding opinions regularly. Judgements in individual cases are published, so the Supreme Court’s practice influences the judiciary.

  • II – JUDICIAL REVIEW OF ADMINISTRATIVE ACTS

  • III – NON-JUDICIAL SETTLEMENT OF ADMINISTRATIVE DISPUTES

  • IV – ADMINISTRATION OF JUSTICE AND STATISTIC DATA