The Constitutional Court has initiated proceedings on a norm of the Civil Procedure Law regulating submission of an ancillary complaint
On 28 February 2012, the Second Panel of the Constitutional Court has initiated a case “On Compliance of Section 141 (1) insofar as It Fails to Provide the Right to Submit an Ancillary Complaint for a Decision Rejecting an Application on Securing of a Claim and a Decision Rejecting an Application on Revocation of the Security of a Claim, with Article 92 of the Satversme of the Republic of Latvia[1]”.
Contested Norm
Section 141 (1) of the Civil Procedure Law provides: “An ancillary complaint may be submitted in regard to the decisions referred to in Section 140, Paragraphs two, three and five of this Law and the decision with which the application for the securing of evidence is refused.”
In the case mentioned in Section 140 (2) of the Civil Procedure Law, an ancillary complaint can be submitted for a court decision insofar as it commits the plaintiff to secure losses.
The Facts
The Applicant – a joint-stock company “Swedbank”, based on agreements concluded, has submitted a claim before the Civil Case Department of the Riga Regional Court against its debtors, them being two companies and three private persons, in respect to recovery of contractual fine, as well as recognition as null and void of several immovable property purchase agreements concluded with the debtors. The Applicant had the grounds to consider that the immovable property has been alienated with the purpose to avoid fulfilment of contractual liabilities before the credit institution (JSC “Swedbank”). Along with bringing an action, the Applicant asked to secure the claim, which was partially satisfied by the Court. However, after 10 months, based on applications of the defendants on revocation of the claim security, the Court revoked entirely the claim security previously established.
Pursuant to the Contested Norm, the Applicant can appeal against the decision rejecting applications on revocation of claim security; however, the Applicant cannot appeal against the decision satisfying the above mentioned application.
According to the Applicant, submission of a new application for securing of a claim is not a solution equal to appeal against the revocation of a claim security because the Applicant is denied the access to a court of a higher instance, which could reassess arguments of the plaintiff and provide its opinion in respect to the fact whether the court of a lower instance has acted correctly when assessing the facts of the case and legal justification thereof. The Applicant is of the viewpoint that, as the defendant has the right to appeal, before a court of a higher instance, against a refusal to revoke a claim security, the rights of the parties are not balanced.
Likewise, the Applicant holds that the restriction included in the Contested Norm is not proportional with legitimate aim thereof, which is to ensure a faster and more effective arbitration by reducing workload of courts.
Court proceedings
The Saeima was asked to provide, before 30 April 2012, a reply on the facts of the case and legal justification thereof.
The term of preparation of the case is 27 July 2012.
[1] Article 92 of the Satversme of the Republic of Latvia: “Everyone has the right to defend his or her rights and lawful interests in a fair court. Everyone shall be presumed innocent until his or her guilt has been established in accordance with law. Everyone, where his or her rights are violated without basis, has a right to commensurate compensation. Everyone has a right to the assistance of counsel.”
Linked case: 2012-05-01