In The Matter Of The Application For Revocation Of Section 399 Paragraph. 2 The Insolvency Act

Original Language Title: ve věci návrhu na zrušení části § 399 odst. 2 insolvenčního zákona

Read the untranslated law here: https://portal.gov.cz/app/zakony/download?idBiblio=71733&nr=260~2F2010~20Sb.&ft=txt

260/2010 Sb.



FIND



The Constitutional Court



On behalf of the Republic of



The Constitutional Court ruled June 27. July 2010 in Parliament consisting of the

Vice-President of the Court Of Wagnerové and Stanislav ass-bag,

Vlasta Formánkové, Ivana Janů, Vladimir Crust, Dagmar Lastovecké,

Jiří Mucha, Jan Musil, Jiří Nykodýma, Miloslava Excellent and

Michaela Židlické on the proposal of the High Court in Olomouc on the abolition of

the provisions of § 399 paragraph. 2 the second part of the sentence for a semicolon to Act No.

182/2006 Coll., on bankruptcy and the ways of its solution (insolvency law),



as follows:



The provisions of § 399, in paragraph 2, the second part of the sentence for a semicolon to Act No.

182/2006 Coll., on bankruptcy and the ways of its solution (insolvency law),

added: "If, without apology or if it finds it does not appear

his apology to the Court, it is considered reasonable that took the proposal to

debt relief back ", is cancelled on the date of publication of this finding in the collection of laws.



Justification



(I).



Recap of the proposal



1. The Constitutional Court was the day 3. 7.2009 served High Court in

Olomouc, Czech Republic for annulment of the part of the provisions of § 399, in paragraph 2, the part of the sentence

the second for a semicolon to Act No. 182/2006 Coll., on bankruptcy and how his

solution (insolvency law). The contested provision constructs a legal fiction

the withdrawal of the proposal on debt relief in the event that the debtor without apology

does not appear on the creditors ' meeting convened to discuss how the debt relief and

to vote on its adoption or his apology does Court

reasonable. On this provision follows section 394 paragraph. 2 of the insolvency

the law, according to which the Court takes note of the withdrawal of the proposal

the decision, which is delivered to the person who filed the proposal, the debtor,

the insolvency administrator and the creditor committee, and article 396, paragraph. 1

Insolvency Act, according to which is a consequence of the withdrawal of the proposal on

debt relief bankruptcy debtor bankruptcy solutions. The Constitutional Court finding sp.

Zn. PL. ÚS 42/08 dated May 21. 4. set aside the part of the provisions of § 2009 394 in

paragraph 2, the part of the sentence for a semicolon, which sounded: "the appeal against the

It is not acceptable ". This finding was announced in the collection of laws of the day 9. 6.

2009 under no 163/2009 Sb.



2. the applicant stated that leads under the SP. zn. KSOS 16 INS 4988/2008 2 VSOL

87/2009 insolvency proceedings, in which the Court applied section 394

paragraph. 2 the Insolvency Act in the version effective until 8. 6.2009, and further

the provisions of section, paragraph 369. 1 (obviously meant to section 396 (1)) and § 399 paragraph. 2

the same regulation. Insolvency proceedings were initiated at the regional court in

Ostrava-branch in Olomouc (hereinafter referred to as the "District Court") on 8. 12.2008,

While the debtor filed, together with a proposal to design the insolvency

authorisation of debt relief. The District Court in its resolution of 20 April 2004. 1.2009 no j.

KSOS 16 INS 4988/2008-and-9 found the debtor's bankruptcy,

the insolvency administrator and the solution has allowed bankruptcy phase. At the same time

ordered on day 5. 3.2009 review meeting, which will be held at 9:00 pm

PM. at the headquarters of the regional court, and on the same date and place of the meeting and called the

creditors, which should take place immediately after the end of the review

the negotiations. Although the debtor was properly summoned to a meeting of creditors is

on 5 July 2004. 3.2009 without apology. The District Court therefore gave the same

the date of the resolution No j. KSOS 16 INS 4988/2008-B-12, which took note of the

the withdrawal of the proposal to allow debt relief, said the assets of the debtor

audition and decided that the auditions will be discussed as a slight. This

the decision was attacked by the borrower in the full scope of the appeal, in which he argued that

his participation at the meeting of creditors to prevent its bad state of health, which

the respondent physician confirmation of 10 June 1999. 3.2009. After

the claimant debtor asked that the resolution of the bankruptcy on his

the assets set aside and the matter returned to the District Court for further proceedings, or

to the claimant himself decided on the debt relief repayment plan calendar. Without

the importance of according to the petitioner, or content is not the official record drawn up by the

After the end of the meeting of creditors, the insolvency judge under which was the day

5.3. 2009 at 10:00 pm. the debtor is present in the Law Office Mgr. to.

in sumperk, which said that he had considered that the review conferences and meetings

the lenders will take place at the District Court in Šumperk.



3. the applicant stated that the Constitutional Court finding SP. zn. Pl. ÚS

42/08 expressed legal opinion that the unconstitutionality of the provisions of section 394 paragraph. 2

Insolvency Act, part of the sentence for a semicolon, lay in his

the application links to the clearly unconstitutional part of § 399 paragraph. 2 (for the sentence

a semicolon) Insolvency Act, which reads: "If, without apologies

does not appear, or if the Court finds his apology, it is reasonable

for that, he took the proposal on debt relief back. " The Constitutional Court in that

the award emphasized that one of the fundamental principles of controlling civilian

the process is the principle of disposition. The withdrawal of the proposal to allow debt relief is

dispozitivním Act of the debtor and of its nature, that cannot be

the content of the legal fiction, IE. It cannot be established that the debtor has taken the proposal

back, as he has done so effectively. The fiction of withdrawal of the proposal

designed the provision of section 399 paragraph. 2 the second part of the sentence for a semicolon

Insolvency Act is therefore, according to the cited award is contrary to the nature of the

civil process.



4. From the article. paragraph 89. 2 of the Constitution of the Czech Republic follows the general courts

the duty to decide in accordance with the legal opinion expressed by the award

The Constitutional Court, and not only in the specific case, which concerned the finding, but

also in cases in which they are dealt with issues of similar or identical.

The obligation to follow in deciding other cases of the same kind "ratio

decidendi "landed and supporting legal rules applied

(the reasons for the decision) contained in the award, has accentuated the Constitutional Court

finding SP. zn. III.-252/04 of 25 June. 1.2005 (N 16/36 SbNU 173).

The appellant, therefore, reflect the legal opinion of the parties, the withdrawal of the fiction proposal

to allow debt relief in finding authorization SP. zn. PL. ÚS 42/08.



5. In support of the arguments contained in the finding of the applicant

refer to the adjustment of the withdrawal of the proposal contained in section 96 of the Act No. 99/1963

Coll., the civil procedure code, as amended, (hereinafter referred to as

"civil procedure"), in relation to which the judikatorní practice of the inferred

that the withdrawal of the proposal can only occur through an act from which the

There are no doubts about its content and meaning, and it is therefore completely

no doubt that a party to proceedings on consideration of its proposal, or its

part, not interested and is aware that the proposal will not be a Court of

to be judged. While the code of civil procedure envisages a meaningful and

the manifestation of will, free of any conditions, insolvency law

allows you to have the effects of withdrawal, without the manifestation of the will of the debtor

to satisfy these conditions.



6. From the defined reasons, concluded the appellant concluded that the provisions of the

§ 399 paragraph. 2 the second part of the sentence with a semicolon for the Insolvency Act is in

contrary to the article. paragraph 36. 1 and article. paragraph 38. 2 of the Charter of fundamental rights and

freedoms (the "Charter"). If the disposition of permission

the party replaced by legal fiction, which occurs on the

the basis of the participant's inactivity or even merely on the basis of the evaluation

considerations of the Court to stop the entire proceedings, is such a construction

the petitioner also in breach of article. 2 (2). 3 of the Charter. The appellant, therefore,

in accordance with article. paragraph 95. 2 of the Constitution of the Czech Republic and § 64 paragraph. 3 of the law

No. 182/1993 Coll., on the Constitutional Court, as amended, (hereinafter the

"the law on the Constitutional Court") submitted a case to the Constitutional Court, to its

finding the provisions of § 399 paragraph. 2 the second part of the sentence for a semicolon

Insolvency Act set aside a day to be determined in the award.



7. In conclusion, the appellant pointed to the fact that insolvency proceedings

cannot be interrupted, and that the effects of bankruptcy on the debtor's assets

the publication of the decision occurred in the insolvency register, and

He suggested that the Constitutional Court discussed his proposal as an emergency within the meaning of section

39 of the law on the Constitutional Court, since the next procedure in the context of bankruptcy

the management changes may occur that prevents the debtor originally enabled

debt relief. In addition, the petitioner may have according to the decision on this proposal,

If granted, the importance for insolvency proceedings of other borrowers.



II.



The progress of the proceedings and a recap of the representation of the parties



8. in accordance with section 69 of the Act on the Constitutional Court called on the Constitutional Court

Chamber of deputies of the Czech Parliament and the Senate of the Parliament of

The Czech Republic, to make a proposal for a comment.



9. The Chamber of Deputies, through its President, Ing. Miloslava

Go said that the draft insolvency law was discussed in the first

reading on 26. 10.2005 as print 1120 and was subsequently commanded by constitutionally

the legal Committee, which dealt with it at its meeting of 1 June 2006. 12.2005

and 20. 1.2006, being recommended to approve the text of the comprehensive

the proposed amendment, contained in the Committee's resolution No. 235 (print

1120/1), which has been redesigned and § 399 paragraph. 2 the Insolvency Act.

Second reading of the draft was held April 27. 1.2006 and amendments in it
raised were processed as print 1120/2. The Bill was approved by the

in the third reading on 8. 2. the text of the amendment to the 2006 comprehensive

the proposal constitutionally the legal Committee and the other amendments. Law

He was subsequently signed by the competent constitutional actors and announced in

The collection of laws under no. 182/2006 Coll. of the provisions in question was not

subsequent amendments to this regulation.



10. the Senate of the Parliament of the Czech Republic in this connection, he stated that the proposal

the Act, whose provisions it is proposed to abolish, he was sent to the day

28.2. 2006 and the Organising Committee of it as print no. 288 commanded to

discuss the constitutionally-legal Committee and of the Committee for economy,

Agriculture and transport. The proposal was discussed by the two committees on 15. 3.

2006, respectively. 22. 3.2006, both of which consistently recommended the adoption of the law

in the version approved by the Chamber of Deputies. The Bill was Senate

approved on its 10. meeting as resolution No. 416 of 30 December. 3.2006, from

54 present senators and senátorek voted for adoption of the law 49,

no votes against and 5 abstentions present. To

the provisions, which is the subject of proceedings before the Constitutional Court, has not been

No discussion; Institute of debt relief, the debate concerned only what

in its application in case of a legal person which is not

an entrepreneur. In the framework of the approval process, therefore no opinion,

which could be the appellant's claim of unconstitutionality of section 399 paragraph. 2

the Insolvency Act to support, or refute. The Senate discussed

the draft law within the limits of the Constitution of the Czech Republic set out competences and

constitutionally prescribed manner, with the majority coming from

the belief that the law is in accordance with the constitutional order of the Czech Republic

and with its international obligations. It is now up to the Constitutional Court to

examine the constitutionality of the provisions in question.



11. All interested parties expressed their consent with the abandonment of the oral

negotiations within the meaning of section, paragraph 44. 2 of the law on the Constitutional Court.



III.



The diction of the contested provisions of the legislation



12. The contested provisions of the Insolvency Act reads as follows:



§ 399



[...]



(2) the debtor and insolvency administrators delivers court summons

at the meeting of creditors referred to in paragraph 1 into your own hands with lessons about

the necessity of their participation. The borrower is obliged to participate in such

the meeting in person and answer the questions of the creditors; If no

apologies, fails or if the Court finds his apology

reasonable, it is considered that the proposal took on debt relief back.



[...]



IV.



Locus standi of the petitioner



13. According to the article. paragraph 95. 2 of the Constitution of the Czech Republic, if the Court concluded

the law, which is to be used in solving the case, is in contradiction with the constitutional

policy, shall refer the matter to the Constitutional Court. This permission is also

instantiated in § 64 paragraph. 3 the law on the Constitutional Court, according to which the

the Court in the Constitutional Court, to submit a proposal for the repeal of the law or its

individual provisions. The condition of such litigation consulting

the proposal is the fulfillment of the article. paragraph 95. 2 of the Constitution of the Czech Republic in the

that must be about the law, which has to be in the solution of the matter

used, IE. Act or its provisions, which, it is proposed to abolish,

the applicant should be directly applied in resolving a particular dispute.

The Constitutional Court found this condition, since the applicant will be filled

assess the reasonableness of an appeal against a judgment debtor's insolvency

the Court issued just due to embark upon the effects of the withdrawal of the legal fiction

the proposal contained in the contested provision. Facts concerning the course

insolvency proceedings, the Constitutional Court's checked in the file of the regional court

KSOS 16 INS 4988/2008, available in electronic form at

https://isir.justice.cz (Insolvency Register).



14. only for completeness of the Constitutional Court notes that the conclusion on justification

the petitioner is not in conflict with the opinion expressed by the sp in the award. zn. PL.

TC 42/08, in which the Constitutional Court held that the applicant was not the same for

the submission of the application for revocation of section 399 paragraph. 2 the Insolvency Act

actively legitimován (point 22 of the award). Cited the legal opinion from the

specific procedural situation, when cancellation provisions not

included in the small print of the proposal and in particular when the Constitutional Court

considered the question whether it is even within the competence of the appellant on the appeal

meritorně decide. In other words, when it comes to finding SP. zn.

PL. ÚS 42/08, the claimant was in a situation where he had to deal

with the question of admissibility of the appeal and not with the question of his merits tests are applied,

Therefore, at that point, the contested provisions did not apply itself. In the now

However, it was considered, as already explained, the situation is different.



In the.



The constitutional conformity of the legislative process



15. In the context of proceedings for annulment of the Act or part of the constitutional

the Court examines whether the legislation adopted and published within the limits of

The Constitution of the Czech Republic set out competences and constitutionally prescribed

manner (section 68, paragraph 2, of the Act on the Constitutional Court). Since the constitutionality of

the adoption of the contested parts of the insolvency law was not any of the participants

management questioned the Constitutional Court checked the constitutional konformitu

the legislative process only formally from publicly available sources

(http://www.psp.cz), and found that all the procedures have been

When adopting the contested legislation complied with. About the course

the legislative process can be fully refer to recap

performed by the participants in the proceedings (points 9 and 10 of this award).



VI.



The legal evaluation of the Constitutional Court



16. the provisions of § 399 paragraph. 2 the Insolvency Act imposes on the borrower,

which has been allowed to participate in debt relief, the obligation to creditors ' meetings and

answer their questions; with the non-participation of the debtor's Act combines Unexcused

the penalty in the form of boarding of the effects of the withdrawal of the fiction proposal. As a result of

the application of the debtor loses the ability to deal with fiction the decay phase, and is on the

It is declared bankrupt (section 396 (1) of the Insolvency Act). The withdrawal of the

the draft takes note of the resolution of the insolvency court (§ 394 (2)

Insolvency Act).



17. The Constitutional Court is already complex provisions governing the consequences of

the judgment debtor, the creditors ' meeting which was allowed to debt relief,

dealt with in finding SP. zn. PL. ÚS 42/08, published under no. 163/2009

Coll., which set aside the provisions of § 394 in paragraph 2 of part

sentences with a semicolon for the Insolvency Act, which precludes an appeal

against the resolution, which was the withdrawal of the proposal, the Court noted.

The Constitutional Court cited the award noted that from the perspective of maintaining

the insolvency of the debtor's rights to a fair trial appears necessary to

against the decision of the Court of Auditors on the basis of the fiction of withdrawal of the proposal according to the §

paragraph 399. 2 the Insolvency Act existed for appeal, and both

in order to remedy obvious oversights, which can be in the activities of the Court

occur (excuse the debtor is embedded in another file), as well as due to

possible long-term effects of fiction on the accession assessment judgement

the insolvency court (if the Court finds an excuse to be warranted).



18. The Constitutional Court at the same time subjected to criticism of the construction of legal fiction

contained in § 399 paragraph. 2 the Insolvency Act: "the civil process is

among other things, on two basic principles-the principle of disposition and principle

projednací. The close interrelationship between the private law and public

civil procedural law is best expressed in the just principle

disposition. The sense and purpose of civil procedural law is to provide

the protection of subjective rights, i.e. private. public civil procedural

the right to use private law material, and if the task fails, the

loses its meaning. Reciprocal functional relations in private law, the substantive

which is based on the autonomy of the will of the participants in private-law relationships, and

public of the civil procedural law are reflected in the law of

process primarily through the disposition principle, which controls

civil process. The disposition principle represents a specific projection

private autonomy of will in the field of civil process. Parties is

given that, in accordance with the principle of disposition, ' how

management, as well as the subject of the proceedings. The procedural rights that are derived from the

the principle of disposition, are reserved exclusively to the holders of these rights in the form of

of the procedural acts; the nature of these dispozitivních

procedural acts shows that the content may not be legal fiction, IE.

It cannot be established that someone took the proposal back, as not doing so.

The legal structure of the proposal for withdrawal of the fiction is in contradiction with the

the nature of the civil process, which applies not only to the civil process, the questionable

but for any kind of civil court proceedings, i.e.. even for insolvency

the proceedings. The disposition of the legal act cannot be the content of a legal fiction, without

This principle was violated the disposition, on the basis of the civil

the process of being built, and ultimately also the principle of the autonomy of the will. How

for example, the Constitutional Court said. in finding SP. zn. I. ÚS 167/04 of 12 January.

5.2004 (N 70/33 SbNU 197 ^ *), "the autonomy of the will and the free
individual is guaranteed at the level of the constitutional article. 2 (2). 3

The Charter of fundamental rights and freedoms. The provisions of the article. 2 (2). 3 of the Charter is

to be understood in a double sense. In its first dimension represents

the structural principle according to which the State power to individuals and

its autonomous sphere (including autonomous expressions through) apply

only in cases where the conduct of an individual violates expressly

drafted ban on the modified law. Also, such a ban, however, must

reflect only the requirement of preventing individuals in

interfering with the rights of third persons, and in the promotion of the public interest, if the

legitimate and proportional to such a restriction of the autonomous negotiation

of the individual. Such a principle is to be understood as essential

relevance of each democratic State (article 1, paragraph 1, of the Constitution

The Czech Republic). Similar content has also provisions of article. 2 (2). 4

Of the Constitution. In his second dimension then acts article. 2 (2). 3 of the Charter as

the subjective right of individuals to respect the public power

Autonomic manifestations of his personality, including speeches, through which they have

reflection in his specific negotiations, if such act is not a law

expressly prohibited. The provisions of the article. 2 (2). 3 of the Charter, in its second

the dimension in which it operates as a fundamental right of the individual, is then to be

apply immediately and directly. In this dimension is not a mere

prozařování a simple law, but rather a subjective right, which operates

directly against State power. The authorities of State power are therefore required to

in the application of standards at the same time simple rights of this law, in which the

It reflects the article. 2 (2). 3 of the Charter and article. 2 (2). 4 of the Constitution as an objective

the constitutional principle, interpret also to significantly to

the subjective rights of individuals on the autonomy of the will, which also guarantees

article. 2 (2). 3 of the Charter in its other dimension. " The obligation to respect

autonomy of the will is true not only for the authorities, that the right to interpret and

applied, but no doubt also for the legislature. Efforts to accelerate

the procedure is therefore desirable, on the one hand, on the other hand, however, cannot

to acquire such a form, so that a procedural act of the participant, communicating well in

really take the option of free negotiations. Therefore, in all

advanced legal systems used. the institutes conjecture exclusively

in the determination of the facts, that is. during the clarify and surveys

relevant factual circumstances. Accelerating the institutes (e.g..

judgment by default or the preclusive time limit) so used exclusively in the

the area, which turns the principle of projednací, and it is not possible in the interest of

the acceleration of the procedure to use these funds for the disposal of the management and

the subject of the proceedings. The functions of the legal fiction is not zpravděpodobnění certain

the operative events, the less fiction cannot cover the basic

procedural law the parties dispose of the proceeding and the subject of the proceedings (cf..

closer Macur, j. Judgment on the basis of the recognition of the claim referred to in fiction

the provisions of Section 114b of the s. l. Advocacy Bulletin, no. 2/2002, p. 28-36). "

(point 20 of the Constitutional Court finding SP. zn. PL. ÚS 42/08).



19. The Constitutional Court also pointed out that the fiction of withdrawal of the proposal to

debt relief is from the constitutional point of view, all the more unacceptable, that

It's not just a procedural act whereby the participant has control, but has the

major substantive consequences for both the borrower and the lender (the subsequent

Declaration of bankruptcy). Only the lack of locus standi of the petitioner

in proceedings conducted under SP. zn. PL. ÚS 42/08, in order to prevent the Constitutional Court

then set aside the contested part of the now the provisions of § 399 paragraph. 2

insolvency law (see point 22 of the award).



20. The Constitutional Court had no reason to since the above conclusions

Therefore, he said, that the provisions of § 399, in paragraph 2 of part

the second sentence with a semicolon for the Insolvency Act, through the

the fiction of withdrawal of the proposal on debt relief withdrawing participant bankruptcy

the possibility of the disposition of proceedings is in contradiction with article. 2 (2). 3 of the Charter and article.

2 (2). 4 of the Constitution of the Czech Republic, as well as with the article. paragraph 36. 1 of the Charter,

therefore decided according to section 70 paragraph. 1 of the law on the Constitutional Court, that this

the date of the publication of this provision repeals the finding in the journal of laws.



The President of the Constitutional Court:



in the z.. Wagner v. r.



Vice-Chairman of the



* Note. Red: a collection of findings and resolutions of the Constitutional Court, Volume 33,

find no 70, p. 197