Inconsistency of the Law with the Constitution in administrative proceedings: admission cannot be ignored
It is highly likely that you have noticed a punctuation error in the title of this newsletter. We admit that the comma was deliberately “omitted”, and we propose to consider this matter together.
In the previous newsletter “Testing the provisions of law for inconsistency with Constitution: is it worth waiting for a final “lose” in a case and file a constitutional complaint or other options still available here?” we pointed out that often during the court consideration for some reason both the parties and the court realize the unconstitutionality of certain legislative provisions. We are convinced that such a feeling should be trusted and respectively reacted before the decision on this matter is delivered by the Constitutional Court of Ukraine.
We would like to consider this issue in the context of the current state of affairs with the advocates’ monopoly. Thus, several legislative acts were amended by the Law of Ukraine as of December 18, 2019 No. 390-IX “On Amendments to Certain Legislative Acts of Ukraine on Expanding the Possibilities of Self-Representation in the Court of State Authorities, Authorities of the Autonomous Republic of Crimea, Local Government Bodies, Other Legal Entities, Irrespective of the Procedure for their Establishment”, which came into force on December 29, 2019.
Let’s consider the example of such amendments with reference to the Code on Administrative Proceedings of Ukraine. Thus, part 4 of Article 55 of this Code was read as follows:
In other words, the provisions of part 4 of Article 55 of the Code of Administrative Proceedings of Ukraine again allow the representation of state authorities and local government bodies not only by the head or attorney-in-fact, but also by other authorized representatives in accordance with the law, charter, regulation or employment agreement.
However, the provisions of the Constitution of Ukraine (para. 2 of subpart. 11 of para. 16-1 of Section XV) were not amended and still stipulate the following:
It means, that the current version of part 4 of Article 55 of the Code of Administrative Proceedings of Ukraine (related to extension of the list of representatives) is ABSOLUTELY (!!!) inconsistent with the provisions of para. 2 of subpara. 11 of para.16-1 of Section XV of the Constitution of Ukraine.
At the same time, the provisions of part 2 of Article 8 of the Constitution of Ukraine clearly provide the following:
As a result of such inconsistency, the provisions of part 4 of Article 55 of the Code of Administrative Proceedings of Ukraine shall not be applied, since they directly contradict the provisions of the Constitution of Ukraine.
In other words, legal provisions shall not be automatically applied for only reason they formally have the force of law and were adopted as required by the law: if the law is inconsistent with the Constitution of Ukraine, it shall not be applied a priori.
Therefore, if it is deemed necessary it is required to determine the compliance of the legal provision with the Constitution of Ukraine with every application of such legal provision.
With regard to administrative courts this obligation is based on the provisions of Article 125 of the Constitution of Ukraine providing for the task of administrative courts, as well as on the provisions of the Code on Administrative Proceedings of Ukraine ensuring the protection of an individual within public legal relations.
Thus, provisions of parts 3-4 of Article 7 of the Code of Administrative Proceedings of Ukraine stipulate the following:
“3. If a legislative act is inconsistent with the Constitution of Ukraine, a law of Ukraine, an international agreement duly ratified by the Verkhovna Rada of Ukraine, or any other legislative act, the court shall apply the legislative act that has the supreme legal force or provisions of the relevant international agreement of Ukraine.
4. If the court concludes that the law or other legislative act does not correspond to the Constitution of Ukraine, the court shall not apply such a law or other legislative act, but shall apply the provisions of the Constitution of Ukraine which are deemed to be directly applicable. In this case after delivering the court decision the court shall refer to the Supreme Court in order to deal with the issue as regards to making a submission on the constitutionality of a law or other legislative act, as it is referred to the jurisdiction of the Constitutional Court of Ukraine.”
Therefore, the administrative courts are obliged to assess the provisions of the law for compliance with the Constitution of Ukraine, especially if such an argument was stated by an individual for the purpose of protection of an individual’s rights and freedoms by the administrative courts.
Accordingly, in case when a certain legal provision is recognized to be inconsistent with the Constitution of Ukraine, the court SHALL NOT apply such legal provisions, but shall refer to the Supreme Court inducing the last one to make a submission to the Constitutional Court of Ukraine.
The procedure stipulated by parts 3-4 of Article 7 of the Code on Administrative Proceedings of Ukraine corresponds to the requirements of part 2 of Article 19 of the Constitution of Ukraine, which states that state authorities shall act only on the basis, within the powers and in the manner provided by the Constitution and laws of Ukraine.
Herewith, application of the legal provisions by the court without primary assessment on their compliance with the Constitution of Ukraine will imply the deliberate deviation from the requirements of the Constitution of Ukraine and the Code on Administrative Proceedings of Ukraine.
In the particular case considered above, the provisions of part 4 of Article 55 of the Code on Administrative Proceedings of Ukraine are OBVIOUSLY inconsistent with the Constitution of Ukraine in the current version.
Accordingly, mentioned provision shall not be applied as such that is inconsistent with the Constitution of Ukraine.
Please be informed that this week the courts several times denied tax authority officers being not advocates in participation in the court hearing as tax authority representatives. It means, that legal provisions were not applied due to their inconsistency with the Constitution of Ukraine.
Yet the inconsistency may be not obvious to such an extent that it stands out a mile as in the case under consideration. However, (i.e. necessity to make efforts in order to determine the inconsistency by means of comprehensive analysis) it does not invalidate the requirement not to apply provisions of law that do not correspond to the Constitution of Ukraine, even if such inconsistency is not apparently obvious but may be determined upon analysis conducted.
Another example of inapplicable provisions of the law (due to the inconsistency to the Constitution of Ukraine) is a number of tax legislation provisions as regards to imposing extortionate penalties for late registration of tax invoices that are not issued to the customers.
Certainly, there are other examples of inconsistency of tax legislation provisions with the Constitution of Ukraine. A vivid example of such evidenced inconsistency is last year decision of the Constitutional Court of Ukraine on certain issues of taxes in the ATO area referred to in the newsletter “KM Partners has defended the interests of METRO CASH & CARRY UKRAINE in the Constitutional Court of Ukraine confirming the right for return the local taxes’ overpayment in ATO territory”.
We hope that the whole load of problems regarding the advocate monopoly in the courts, which many judges in the administrative courts will have to face and will be forced to settle the issue of the applicability/non-applicability of legal provisions contradicting the Constitution of Ukraine (leastwise in the case under consideration) will get this issue moving and will incline the administrative courts to complete their actual agenda with the test on consistency of legal provisions to the Constitution of Ukraine.
Following the experience of resolving the issue of advocates’ monopoly, it will be more difficult for judges to “bury their heads in the sand” in other cases and pretend that such a problem does not exist at all and that the law shall be applied since (and for only reason) it is a law. Therefore, it is more likely that the approach of obligatory verification of legal provisions on compliance with the Constitution of Ukraine and other provisions of the law will become an established practice. At last, this is required of administrative courts according to the law, and the Code of Administrative Proceedings of Ukraine itself.
Therefore, we expect the courts to bring more practical attention to the obligatory assessment of the legal provisions to be complied with the Constitution of Ukraine during the court consideration, as required by parts 3-4 of Article 7 of the Code on Administrative Proceedings of Ukraine concerning the non-application of the provisions of laws being recognized by the courts as inconsistent with the Constitution of Ukraine.
The denial in consideration of the issue on inconsistency of a certain legal provision to the Constitution of Ukraine, provided that it is reasonably stated by the plaintiff in a dispute with the state authority, means that the court decision delivered in this manner is unreasonable (the substantive arguments of the plaintiff have not been heard and not considered on the merits!). Moreover, it means the violation of the requirement of fair trial (that may be also considered as a ground for application to the European Court of Human Rights).
The above commentary presents the general statement for information purposes only and as such may not be practically used in specific cases without professional advice.
“Day D”: Draft Law No. 1210 has been adopted in the second reading and as a whole
KM Partners has defended the interests of METRO CASH & CARRY UKRAINE in the Constitutional Court of Ukraine confirming the right for return the local taxes’ overpayment in ATO territory
Blocking of tax invoices: the position of the Supreme Court
Supreme Court on terms of claim submission to the court on issues, related to taxes:
(1) The “Tax” Chamber of the Cassation Administrative Court confirmed the right to apply to the court regarding fine recovery for untimely VAT reimbursement within a 1095-days limitation period
(2) The Unified Chamber of the Cassation Administrative Court confirmed the right to appeal in court of the legal act within whole period of its effect (duration of a statute)
Reduction of court fee in 2019: do we have to rejoice?
New tax rules 2017 – Xmas gifts in general administration of taxes
Rent payment. Changes of 2016
Court practice of the European Court of Human Rights on the issues of court fees
Collection point. Mistake or a crime of the legislator: military fee as an example
Rules in tax and customs disputes in respect of court fee changes from September 1, 2015
When additional import duty will be abolished?