The aim of my study is to overview legal certainty - which is a component to the principle of the rule of law, being one of the issues of constitutionality raised in relation to the statutory rules of 2014 concerning foreign currency loans - based on the decisions adopted by the Constitutional Court in relation to foreign currency loans[1].
The legal regulation of foreign currency debts used to have several forms and the Hungarian Parliament has made several steps to tackle the social problems attributable to the considerable increase in repayment instalments attributable to the economic crisis that started in 2008.[2] Out of those, this paper examines only the statutory rule and the related issues of constitutionality (focusing on the principle of legal certainty) which strive for managing the situation with the statutory presumption of the unfairness of the contracts (meaning that my examination focuses on Act XXXVIII of 2014 on the Settlement of Particular Issues Related to the Uniformity Decision of the Supreme Court (Curia) on Consumer Loans Provided by Financial Institutions, hereinafter referred to as Foreign Currency Act or the Act).
Consequently, this paper does not review the rules of Act LXXVIII of 2014 on the amendment of the Act CLXII of 2009 on consumer credits and of other relating acts (hereinafter referred to as Fair Banks Act) and Act LXXVII of 2014 on the settlement of matters relating to the currency conversion of certain consumer loan agreements and to interest rate rules (hereinafter referred to as HUF Conversion Act)[3] and Act XL of 2014 on the Rules of the Settlement Set out in the Foreign Currency Act and on Other Provisions (hereinafter referred to as the Settlement Act) (only insofar as they are closely related to the Foreign Currency Act).
On 11 November 2014, the Hungarian Constitutional Court adopted its decision on Act XXXVIII of 2014 in a concrete norm control procedure, and it was one of its most important decisions in this issue so far[4]. Decision No. 34/2014. (XI. 14.) of the Hungarian Constitutional Court (hereinafter referred to as the Foreign Currency Decision) refused the judicial initiative for the establishment of unconstitutionality and annulment of the entirety of Act XXXVIII of 2014 and Paragraphs (1)-(3) and (6)-(7) of Section 1 and Sections 4-15 and Section 19 thereof,
I would like to point out that, in the Foreign Currency Decision, the Constitutional Court did not deal with the proposals sent by the Budapest Court of Appeal in substance. I would also point out that, after the Foreign Currency Decision, the Constitutional Court adopted several other decisions in this area, including but not limited to the lengthy and important Decision No. 2/2015. (II. 2.) (where it judged the judicial motions received from the Court of Appeal), and Decision No. 7/2015. (III. 19.), Decision No. 3057/2015. (III. 31.), Decision No. 11/2015. (V. 14.), Order No. 3087/2015. (V. 19.) and three decisions without any merit (orders of refusal). This does however not contain any significant and new argument (as regards the constitutionality of the Act) in comparison to the Foreign Currency Decision, my study does therefore refer to them where and only insofar as it is necessary for being exhaustive, meaning that the main structure of my paper builds on the argumentation of Decision No. 34/2014. (XI. 14.) of the Hungarian Constitutional Court and my own thoughts on constitutionality, in connection with the judicial motions.
After that - and the review of the Act - I examine the provisions of the Act in terms of constitutionality by examining the judicial motions[5].
In conclusion of this part, I would like to make the remark that my paper refers to the previously existing decisions of the Constitutional Court that, in my opinion, correspond to the principles set out in Decision No. 13/2013. (VI. 17.) of the Hungarian Constitutional Court, as Point 5 of the Closing and Miscellaneous Provisions of the Fundamental Law, as in force from 1 April 2013, says that the decisions of the Constitutional Court, which were adopted before the entry into force of the Fundamental Law, become inoperative. This provision does however not affect the legal implications of these
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decisions. In its Decision No. 13/2013. (VI. 17.), the Constitutional Court found that "for issues of constitutional law examined in newer cases, it may use the arguments, legal principles and the constitutional context elaborated in its previous decisions, if there is nothing against the applicability of the findings on the basis the identicality in terms of content of the given section of the Fundamental Law and the Constitution, its contextual identicality as regards the entirety of the Fundamental Law, consideration of the interpretation rules of the Fundamental Law and the case at hand, and their incorporation into the decision to be adopted seems necessary."
After the adoption of the act, it was a reasonable expectation that those, to whom the legal settlement was detrimental (i.e. the banks) would exercise their right warranted by the Fundamental Law and international agreements, and would initiate procedures on every possible forums in order to somehow neutralize the provisions that are detrimental to them. The examinations in this study are based on, amongst other things, the efforts to initiate procedures at the Hungarian Constitutional Court as well.
As the subsequent constitutional review as an actio popularis is not known to the Fundamental Law anymore, the banks which were affected by the legal provisions had a limited number of opportunities: theoretically, the options they had were the constitutional appeal and the concrete subsequent constitutional review initiated by a judge. (As there was not any preliminary constitutional control initiated by the President of the Republic, and no motion was submitted to initiate a subsequent control by those who would have been entitled to do so, I neither mention nor examine these options).
In the "first round" four judicial initiatives were submitted to the Constitutional Court. In a chronological order, these were the following:
1) It was the judge of the Budapest-Capital Regional Court to lodge an motion before the Constitutional Court (hereinafter referred to as the 1[st] motion). The brief summary of its argumentation is the following:
According to the judicial initiative, the Foreign Currency Act (and its individual provisions) infringe the Fundamental Law, especially
a) Paragraph (1) of Article B, which states that Hungary is an independent state with a democratic rule of law;
b) Paragraph (1) of Article C, which states that the functioning of the Hungarian state is based on the principle of power-sharing;
c) Paragraph (1) and (2) of Article M, which states that the economy of Hungary is based on value creating work and the freedom of enterprise, and that Hungary ensures the conditions for a fair economic competition. Hungary shall act against any abuse of a dominant position, and shall protect the rights of consumers;
d) Paragraph (2) of Article Q, which states that, in order to comply with its obligations under international law, Hungary shall ensure that Hungarian law be in conformity with international law;
e) Paragraph (1) of Article XV, which states that everyone shall be equal before the law;
f) Paragraph (1) of Article XXVIII, which states that everyone shall have the right to have any charge against him or her, or his or her rights and obligations in any litigation, adjudicated within a reasonable time in a fair and public trial by an independent and impartial court established by an Act;
g) Paragraph (7) of XXVIII, which states that everyone shall have the right to seek legal remedy against any court, authority or other administrative decision which violates his or her rights or legitimate interests; and
h) Paragraph (1) of Article 26, which states that judges shall be independent and only subordinated to Acts; they shall not be instructed in relation to their judicial activities.
2) Chronologically, the second motion was submitted by the judicial council of the Court of Appeal of Budapest (hereinafter referred to as 2[nd] motion):
This submission gave the reasoning that the contested provisions of the Act are in conflict with
a) Paragraph (1) of Article B,
b) Paragraph (1) of Article C,
c) Paragraph (1) of Article XXVIII, and
d) Paragraph (1) of Article 25, and
e) Paragraph (1) of Article 26 of the Fundamental Law.
3) The third motion (hereinafter referred to as 3[rd] motion) arrived to the Constitutional Court on 15 October 2014, also from the Court of Appeal of Budapest, and it pointed out the infringement of
a) Paragraph (1) of Article B,
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b) Paragraph (1) of Article C,
c) Paragraph (1) of Article XXVIII, and
d) Paragraph (1) of Article 25, and
e) Paragraph (1) of Article 26 of the Fundamental Law.
4) The last motion (hereinafter referred to as 4[th] motion) also came from the judicial council of the Court of Appeal of Budapest, and refers to the infringement of the provisions of the Fundamental Law, as in the 3[rd] motion, as listed in the foregoing.
In summary, the judicial initiatives refer to the infringement of the following provision(s) of the Fundamental Law:
a) Paragraph (1) of Article B;
b) paragraph (1) of Article C;
c) Paragraph (1) and (2) of Article M;
d) Paragraph (2) of Article Q;
e) Paragraph (1) of Article XXVIII;
f) Paragraph (7) of Article XXVIII;
g) paragraph (1) of Article 25, and
h) paragraph (1) of Article 26.
In my paper, I review the problematic provisions of the act made for settlement of foreign currency loans in terms of the rule of law, which was among the judicial arguments, and take a stand regarding their constitutionality. In the following, I, therefore, examine the following aspects of constitutionality: infringement of the principle of the rule of law in terms of retroactivity; infringement of the principle of the rule of law as regards the requirement of clarity of individual norms and the requirement of predictability of the functioning of legal institutions.
In terms of legal certainty, the non-applicability of the required preparation time also applies to the Act. I review this argument outside the context of this study[6].
Legal certainty is subject to the requirement that social relationships should be regulated - with clear, predictable, stable and enforceable laws - and the legal system should be uniform and transparent, the regulations should be knowable. It is also another important requirement that acquired rights and ended legal relationships are protected, warrant the right to appeal and ensure fairness."[8]
I would point out that dealing with the infringement of the principle of the rule of law, legal certainty - which branches from it - and retroactivity is important, because the motions received so far (all four of them) emphasise a serious infringement of this (these) principles), making it the strongest "weapon" for establishing the unconstitutionality of the Foreign Currency Act.[9] If it is stated that a certain law is in conflict with the Fundamental Law for several reasons, but one of such reasons affects the entire law (it can be the prohibition of retroactive effect in this case), then the Constitutional Court will examine that one first (this is, of course, not a mandatory principle in all the cases).
1) When establishing retroactivity, it is to be examined if specific substantive provisions of the Act create any regulatory environment in terms of content. I have taken the following questions to decide that:
a) were any obligations generated, on the basis of the Act, for the time preceding its promulgation, or did the situation become more difficult in a retrospective sense on the basis of the Act?
b) Does the Act establish any legal liability for any behaviour preceding its promulgation which was not unlawful before the entry into force of the Act,
c) did the new, restrictive provisions of the Foreign Currency Act cause any change in already established, ended relationships of substantive law, as a result of the provision giving effect,
d) does the stipulation, already formulated by Vilmos Peschka and saying that a law has two ontological conditions: alternativity (choice between actions) and knowability to the entire society.[10] In other words: is there a choice between actions, if legal relationships can be modified retroactively by reference to a reason (even unfairness), and does "social knowability" have any sense and play any role in such a case.
to a) The answer to the question formulated in Point a) seems easy; as the Foreign Currency Act defines its material scope (applicability) in its Section 1(1) - where it says that this Act applies to the consumer loan agreements entered into by and between 1 May 2004 and the date of entry into force of this Act[11]. It is striking even to a layman that the time in the Act was many years ago. The fact that the Act lays down rules for a period preceding its promulgation is therefore certain, the
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fact that they are mandatory should however be examined in more detail.
Section 4(1) of the Act provides for the fact that the contractual stipulation - save for individually negotiated conditions - allowing for an unilateral increase of interest rates, costs, fees shall be presumed as unfair as regards consumer loan agreements containing the opportunity of unilateral contract modification, having regard to the fact that it does not comply with the principle in Section 4(1)(a)-(g)[12] of the Act. What else would it be about then, than making a situation more detrimental by applying retroactivity: if the contractual stipulation does not comply with the set of standards, then it is considered as null and void, as a sanction. It is obvious that, if the Act and its requirements would have been in force at that time (or would have been "alive" by the application of the law), then the banks and other financial institutions would have fulfilled this obligation (would have complied with it), in order to keep their contracts free from any subsequent challenging.[13]
to (b) I have answered question (b) with the previous sentences, since the Act establishes the legal liability of financial organisations by setting up a (rebuttable) presumption, and its sanction - if contractual stipulations are unfair -: unfairness, it therefore influences - with the ruling adopted at the end of a lawsuit - its legal relationship with an individual.
to (c) In case of question (c), my starting point is that there are conclude contracts, the parties of which are the financial institutions and the individual consumers. The legal regulation of contracts is governed by the relevant provisions of the Civil Code[14] as lex generalis and the Financial Institutions Act[15], as special norm. By virtue of Section 205(1) of the Civil Code, a contract is made by the mutual and concordant expression of the will of the parties. This means that the signing of contracts makes substantive legal relationships[16] (consumer loan agreements), and the contract gave rise to the obligation to fulfil a service; and an entitlement to request the service[17]. (If one considers Paragraph (1) of Section 6:63(1) of the new Civil Code, under subtitle [Creation and content of contracts], the case is the same; a contract is made by the mutual and concordant expression of the will of the parties. A contract consists of a number of facts giving rise to obligations; and an obligation enters, according to Section 6:5(1) of the Civil Code [Entry into force of a declaration with legal effect], immediately in force by the declaration with legal effect made between the attending persons. As a corollary, the consumer loan agreements entered into force in the time of contract conclusion - according to the interpretation of the provisions of the new Civil Code as well.
This means that the Foreign Currency Act ads a new legal framework to the substantive requirements -general contracting terms and conditions - of contracts, meaning that it causes change to already established, sometimes ended[18] substantive legal relationships. In my view, the Act also reopens some of the already ended relationships and revaluates them from new aspects as well.
I must mention the periodic regulation of the Credit Institution Act at this point as well, because one can identify a gradually tightening trend in terms of consumer loan agreements. According to Section 210(3) of the previous Credit Institution Act[19], any modification of the interest rate (or fees, etc.) that is detrimental to the client, meaning that a detrimental, unilateral contract modification, may only take place if it is clearly allowed by the General Terms and Conditions in a separate clause - which is a so-called unilateral, cogent condition - which if met by the bank, then it can be sure that the stipulation will not conflict the law (the Credit Institution Act).
As from 1 August 2009, the regulation became tighter in two steps, and Section 210 was further modified on 1 January 2010.[20] In addition, the conditions for contractual stipulations were also modified from 15 November 2011 and 9 December 2012. It must be emphasised that the gradual regulation allowed the modification of any contractual condition in a way that is detrimental to the consumer before 1 August 2009; afterwards, only the provisions concerning the interest rate, fees and costs were modifiable in an unilateral manner. On the basis of this, one can see that the Credit Institution Act settled the statutory conditions for unilateral contract modification in a manner that is not uniform either in time or detail.
Consequently, one can say that the period made subject to debates may not be regarded as uniform and homogenous, the legislative environment was changing constantly (after 1 August 2009, 1 January 2010 and after 15 November 2011 and 9 December 2012, until 26 July 2014). The Foreign Currency Act still does that. Ignoring this, the Constitutional Court found, in its majority position, that the Act does not create any substantive law retroactively, but enacts the interpretation of the substantive law that was always in force in the time period concerned, and elaborated and made mandatorily applicable by European and Hungarian judicial practice[21] (meaning that the clarification of the interpretation of substantive law made it already part of substantive law) into the Act, and raised it to the level of laws.[22] This is what Judge Sulyok of the Constitutional Court also emphasises, meaning that the principles of the Act were
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present earlier as well. This approach is also reinforced by Decision No. 7/2015. (III. 19.) of the Constitutional Court - to which László Kiss, the Judge of the Constitutional Court, attached a dissenting opinion in the same regard - , and Decision No. 11/2015. (V. 14.) of the Constitutional Court, which did not found the motion raising objection against the "legislation" of the Supreme Court (Curia) as substantiated.
My question is merely that if these principles were so much clearly present previously, then why was it necessary to reinforce them and to define them in a new form? If they were present previously, then the courts could have applied these principles in lawsuits concerning foreign currency loans without any doubt.
The opinion contrary to the position of the Constitutional Court says that the Act is not only the codification of judicial practice for the future, but also an extension of judicial practice, and is, therefore, the back-projection of the interpreted rules of the Credit Institution Act which are in force from 1 January 2010 (partly from 1 August 2009) to the previously established general contract terms and conditions and con-tracts.[23] In addition, neither Opinion No. 2/2012. of the Civil Department nor Decision No. 2/2014. for the Uniform Application of the Civil Law[24] mentions that individual aspects of the unfairness of unilateral contract modification - as appearing in the Civil Department Opinion - should be generally applicable to every general contract terms and conditions established after 1 May 2004, and thus every contract.[25] The opportunity to apply the mentioned instruments ensuring legal unity generally and directly from 1 May 2004 is created by the Act.[26]
ad (d) The "Peschka-question (Point (d)) can be answered with a simple logical conclusion. Whereas Act XXXVIII of 2014 imposes that contract stipulations must comply with the immanent principles (they are otherwise unfair) as from 1 May 2004; therefore, the financial institutions did not have the choice between the options of action between 1 May 2004 and 26 July 2014. Namely all the principles exhaustively listed in the Act did not appear at legislative level previously in the Hungarian legal system[27], and the laws (the relevant provisions of the Credit Institution Act and the rules of Government Decree No. 275/2010 (XII. 15.)[28]) providing for the principles previously regulated by the laws were not in force during the entire period indicated by the Act. In case of the Foreign Currency Act - which regulates the quality of contract stipulations (fair/unfair) as from 1 May 2004 - , it is also clear that there was not any opportunity of familiarisation on the level of society.
According to the position of the Decision of the Constitutional Court, the current conditions were deductible from the general legislative provisions from the outset[29], which were subsequently set out in an opinion of the Civil Department (2/2012), a Decision (2/2014) of the Supreme Court for the Uniform Application of the Law, and law (Act XXXVIII of 2014). According to the reasoning of the Constitutional Court, it can be presumed that the interpretation of the law would be the task of the parties concluding the contract, because the principles were ab ovo deductible from the general legislative environment.[30] Contrary to the majority position, Péter Paczolay argues that the Act is only a combination of certain elements existing in judicial practice, and it represents the interpretation of the Opinion of the Civil Department and the Decision of the Supreme Court on the uniform application of the Law (ad Directive 93/13/EEC) by the legislator [348].
2) In the following, I would like to use the prohibition of retroactive legislation and the preceding practice of the Constitutional Court in terms of the principle of the rule of law[31] to emphasise the importance of excluding even the suspicion of any infringement of such principles. "The concept of the rule of law includes the requirement of legal certainty, which obliges, amongst others, the state as legislator to ensure the clarity, unambiguity of the entirety of the law, each of its domains and the individual laws, and that they are predictable and foreseeable in their functioning to the recipients of the norm. Furthermore, legal certainty does not only require - according to the previous Decisions of the Constitutional Court - the unambiguity of individual norms, but also the predictability of the functioning of the individual legal institutions [Decision No. 9/1992. (I. 30.) of the Constitutional Court; Decision No. 26/1992. (IV. 30.) of the Constitutional Court; Decision No. 31/2007. (V. 30.) of the Constitutional Court]." In its previous decisions adopted in pursuance of the Constitution, the Constitutional Court deduced the constitutional principle of the prohibition of retroactive legislation from the requirement of predictability and foreseea-bility [Decision No. 34/1991. (VI. 15.) of the Constitutional Court; Decision No. 11/1992. (III. 5.) of the Constitutional Court; Decision No. 25/1992. (IV. 30.) of the Constitutional Court; Decision No. 28/1992. (IV. 30.) of the Constitutional Court; Decision No. 4/1992. (I. 28.) of the Constitutional Court].
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In its Decision No. 25/1992. (IV. 30.), the Constitutional Court established that legal certainty is an important component to the rule of law, and that requires, amongst others, that the rights and obligations of the citizens are regulated by laws that are promulgated as provided for by the law and accessible to everybody, and there should be a real opportunity for the legal entities to adjust their behaviour to the requirements of the law, and the laws should, to this end, not establish any obligations for the time preceding their promulgation and not qualify any lawful behaviour as unlawful retroactively.[32]
The Parliament sometimes overrode the prohibition of retroactivity formulated in the decisions of the Constitutional Court and the Legislation Act by modifying the previous Constitution. Negative retroactivity to the recipients was caused, amongst others, by the retroactive exclusion of the passive voting right of policemen and -women for 3 years and the constitutional settlement of the 98% extra tax. In this case, however, infringement of the prohibition of retroactivity cannot be presumed either on the level of the Fundamental Law or at legislative level, establishment of the conflict with the Fundamental Law does, therefore, not have any formal obstacles.
It must be noted for these issues that, according to the practice of the Constitutional Court, legal certainty requires, amongst others, the protection of acquired rights, and that completed or otherwise finally ended legal relationships are left untouched, and the limitation of the changing of durable legal relationships made in the past with constitutional rules. Section 1(6) and (7) of the Act does however subsequently enable the enforcement of the rights of contracting parties as regards claims that have not been enforced for more than five years without modifying the rules on the lapse of claims, by interpreting the rules of the former Civil Code normatively. The fact that Section 4(1) of the Act defines new criteria for legal nullity of contractual provisions having been in force for a long time, in fact retroactively for the time of contract conclusion means that the Hungarian Parliament uses its legislative powers to change the (ended) contractual relationships of the parties.[33] In addition, László Kiss explains that no release from the requirement to "compare right to right" is possible when making the assessment in the examination of retroactivity (even for the sake of achieving a constitutional goal), because every gap that we allow to open in this principle can be broadened without limitation. Such an argument could ad absurdum lead to the questioning of already ended legal relationships or ones that are under completion and ongoing by making reference to the soul of the people[34].
I would like to remark that, according to the majority Decision No. 34/2014. (XI. 14.) of the Constitutional Court, the Act did not create a new legislative environment, retroactively. I disagree with this, based on the previous statements, especially because already ended relationships were reopened and re-evaluated under the new rules.
I do however point out: Decision No. 7/2015. (III. 19.) of the Constitutional Court, which was adopted after the Foreign Currency Act, reads as follows: "Reference to the prohibition of retroactive legislation may not provide grounds for leaving throngs of unfair and therefore null and void contract stipulations made in the past untouched, and resulting in the unchanged continuation of the fulfilment obligation of the debtors under all circumstances"[35]. This means that the Constitutional Court could have established the existence of retroactivity in the Foreign Currency Act as well, whereas it can be seen that the two solutions would not have differed that much in terms of legal consequences.
In conclusion, and giving an answer, I would like to close this part with a quotation:
"By including general contract terms and conditions that were in force between 1 May 2004 and 1 August 2009 and the contracts based thereon into its scope, the Act goes beyond judicial practice and enforces new requirements and new measures for the unilateral amendment of consumer loan agreements, meaning that it regulates with real retroactivity."[36]
(a) I start the analysis of the requirement of unambiguity and predictability by taking the previous practice of the Constitutional Court as a "standard". The Constitutional Court explained that legal certainty is an indispensable element to the rule of law in many of its previous decisions. In its interpretation of legal certainty, the Constitutional Court makes the requirement that the entirety of the law, its certain domains and the individual laws are clear, unambiguous, and predictable and foreseeable to the recipients of the laws in terms of their function an obligation of the legislator [Decision No. 9/1992. (I. 30.) of the Constitutional Court, DCC 1992, 59, 65-66.; Decision No. 11/1992.
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(III. 5.) of the Constitutional Court, DCC 1992, 77, 81-82.; Decision No. 28/1993. (IV. 30.) of the Constitutional Court, DCC 1993, 220, 225.].
(b) Here, I would like to draw attention to the fact that certain decisions adopted in this topic for the unified interpretation of the law, and not being unambiguous, may be subject to the control of the Constitutional Court[38]. The judicial motion[39] requested the Constitutional Court - pursuant to Section 155/B(1) and (3) of the Civil Procedures Act, in addition to the suspension of the preceding ongoing procedure - to establish the fact that Point 3 of Decision No. 5/2013. of the Supreme Court on the uniform interpretation of the Civil Law concerning the lawsuits initiated to establish contract invalidity (partial invalidity) under Section 239/A of the Civil Code and Point 4 of Decision No. 6/2013. of the Supreme Court on the uniform interpretation of the Civil Law concerning certain issues arisen in lawsuits concerning loan agreements denominated in foreign currency are in conflict with the Fundamental Law. It did so with reference to the fact that the decisions for the unified interpretation of the law do not ensure the uniform application of the law by the courts, because they provide inconsistent guidance (meaning that they are in conflict with the requirement of unambiguity and predictability). Having regard to Decision No. 9/1992. (I. 30.) of the Constitutional Court, which states that the substantive predictability of legal institutions are ensured by various means, amongst them are those of legal uniformity, in the rule of law, there should not even be a possibility that the acting judges apply the law with such an inconsistence, especially if the issue concerns such a large part of the society.
The position of the Constitutional Court on actual or alleged collision between laws of the same level is - according to the findings kept at a theoretical level in Decision N. 35/1991. (VI. 20.) of the Constitutional Court - that "any inconsistent - or interpretatively inconsistent - legal settlement of specific relationships in life and facts does not constitute unconstitutionality on its own". This means that the two decisions for the unified interpretation of the law, which were objected in the motion, are not in conflict with the Fundamental Law for their inconsistency only, but the fact that there are ambiguous items in the decisions for the unified interpretation of the law has already caused problems, and the paradox described above has arisen among legal practitioners. For that reason, the requirement of unambiguity is infringed in the atmosphere of legal unity. The 1[st] judicial motion has furthermore pointed out that predictability and foreseeability is a constitutional requirement for legal practitioners during the interpretation of legal norms as well (Article 28 of the Fundamental Law).
In addition, Section 11(1) of the Act - reinforcing the normativity of the "criteria of unfairness" itemised in Section 4(1) of the Act - provides that "[the] court only examines if the contract stipulation regarded by the financial institution as fair is fair under Section 4(1)". This is inconsistent with and conflicts the norms of the previous and the current Civil Code and the judicial practice developed hereon: these provide that the ordinary courts have to examine all the circumstances of the transaction in similar cases. This - having regard to the fact that there is a conflict between the norms of the same level of legislation - on its own may give rise to annulment, because it is inconsistent with the principle of legal certainty...[For the first time, see Decision No. 35/1991. (VI. 20.) of the Constitutional Court, DCC 1991, 176-177].[40]
(c) Continuing the examination of the requirement of unambiguity and predictability, I would like to point out that there is no consistent legal continuity that would, however, make legal institutions predictable in their functioning. Legal certainty, which is an important component to the rule of law, requires the actual opportunity that the legal entities can adjust their behaviour to the requirements of the law.[41]
My starting point is that Section 4(1)(a)-(g) of the Foreign Currency Act define (subsequently!) the requirements for regarding contract stipulations as fair (by setting up presumptions). In consideration thereof, the question arises, how the opportunity was ensured to financial institutions to adjust their behaviour to the requirements of the law? It is important to emphasise the term requirement of the law, because the period between 2005 and 2009 saw many public bodies analyse the "contracting practice" of financial institutions, and all of them fund that the banks were not acting in a fair way, but still only reports, recommendations (Proposal No. 9/2006 of the Hungarian Financial Supervisory Authority for consumer protection; December 2005 Report of the Hungarian Competition Office; Report of 20 June 2008 of the Hungarian Competition Office) were drafted, these do however not have any normative mandatory effect comparable to that of the force of law. These can be considered as guidelines at maximum, and not as rules prescribed. Referring back to the continuity of law from the beginning of my thoughts, it did, in my argumentation and viewpoint, not apply
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and could not operate by way of the recommendations and reports.[42]
One could also raise questions about the liability of the state (public bodies) here, as for long years they failed to make any efficient step to avoid the social and economic problem and tension, which have become acute by now. Nothing prevented the Hungarian Parliament from timely intervention into the development of the processes by means of legislation. This failure is especially striking, because it received the signals that the developed loan-lending practice may become a source of serious social and economic issues (reasoning in the dissenting opinion of László Kiss: [282]).[43] In this connection, I would like to note that we cannot talk about any sort of continuity, because the Hungarian Parliament operates in cycles, and its periods are dominated by different political interest and the expression of those. The "failure" is therefore not the responsibility of the institution, but the political forces that gave the majority in the Hungarian Parliament.
(d) The reasoning of the 3[rd] judicial motion reads that "regulation of an organisation related to the legal status of the state, and with a public service mission and constitutional means to exercise that mission was omitted, whereas the Act - with reference to Section 3:405(2) of the Civil Code -arranged only for the legal representation of the state (Section 7(2) of the Act). Appointment of a legal representative does not mean a substitution in the absence of the lawful authorisation and procedure of a body exercising the public authority of the state and having the rights related thereto, it only concerns the personal scope of the declarations with legal effect in lawsuits and actions of the representative. The regulation of the Act is in force, which is in conflict with the requirement of norm clarity.
e) The 2[nd] motion also has objections regarding the requirement of foreseeability and predictability attributable to the infringement of legal certainty. The applicant explains that every rule for judicial proceedings in the Act (Section 6, 7-15) infringes the constitutional principle of legal certainty originating from the rule of law [Paragraph (1) of Article B of the Fundamental Law of Hungary] due to the doubts which are related to the material and personal scope of a ruling adoptable in a procedure regulated by the Act (in a lawsuit regulated in Subtitle 6) and cannot be resolved with the interpretation of the law (the issue of uncertain legal force, the personal and material scope of the ruling raise the question of uncertain interpretation as for the future). The fact that a ruling might have an uncertain legal force is a problem in itself, because it is questionable, how it can then be enforced, and how could it be made predictable for both the bank and the consumer. The fact that the personal and material scope of a ruling raises the questions of uncertain interpretation for the future also significantly infringes the principle of legal certainty through predictability.
(f) In accordance with the foregoing, it is also to be mentioned that the 1[st] applicant explained that Section 1(2) of the Act is in conflict with the requirement of norm clarity in terms of the fact that the expression "does not need to be applied" does not exclude the option of the application of the Act definitively (Ad1.). It further considers Section 1(1) of the Act to be injurious, as it does not provide an unequivocal definition of the contracts that are "foreign currency contracts" (Ad2.).
Ad1. The Constitutional Court executed its review in the light of the text in force at the time of motion submission, and analysed the expression "does not need to be applied" (and not the later version), during which procedure it found that this formulation is not unpredictable and not overly general, hence it does not result in any legal uncertainty. Its reasoning reads as follows: instead of the expression "must not be applied", the expression "does not need to be applied" in the challenged legislative provision also excludes the applicability of the Act for the consumer loan agreements, the obligation to fulfill which became cancelled due to either a final repayment or the purchasing of the real estate that served as a collateral of the consumer loan agreement by the state.[44] The expression "does not need to be applied" is however still capable of misunderstanding, as it can be interpreted in two ways; it should not be applied, meaning that it must not; or it does not need to be applied, but may be considered. It is still capable of misunderstanding, not clearly interpretable to me, and allows for multiple interpretations. One should however note the fact that the legislator noticed or could have felt the imperfection in Section 1(2) of the Act, because it modified this Paragraph with Act XL of 2014.
Ad2. The majority position of the Constitutional Court justifies the constitutionality of the Act in the light of the issues risen by arguing that the material scope of the Act is defined by Paragraph 1(1) of the Act and complemented by the inserted Paragraph of Act 2.[45],[46] This is contrary to the fact that the Constitutional Court executed the review of constitutionality in the light of the text in force at the time of motion submission (08.09.2014) (Act 2 entered into force on 15.10.2014).[47] Furthermore...[123],
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in the judgment of the Constitutional Court, the foreign currency contracts were concluded in great numbers, their essence is publicly known, the concept of such contracts is set out by the legislator[48], and it is not considered a priori uninterpretable, because the challenged statutory rule could be annulled if that was a priori uninterpretable. I think that this argumentation and formulation of the Constitutional Court is a bit inaccurate, because being publicly known does not warrant the uniform interpretation of the law and norm clarity either. I would, however, like to refer to Point III. 1. of Decision No. 6/2013. for the Uniform Interpretation of the Civil Law, which tries to outline a comprehensive definition, the concept does therefore not become uninterpretable.
In conclusion: the rules of the Foreign Currency Act is objectionable in several aspects of constitutionality. Annulment of the challenged rules could have been possible on the basis of the principle of the rule of law - which was examined herein -, especially in consideration of the fact that the legislator could have had the chance to handle this major social problem in compliance with the safeguards of the rule of law and in a reassuring way. The Constitutional Court did however not prefer annulment in its later practice - with reference to legal certainty. I attempt to elaborate this in the next Point.
In 2016, the Constitutional Court studied, at a judicial motion, a provision of the Settlement Act, but it rejected the motion for its annulment[49]. The applicant judge explained in his/her reasoning that there is a conflict between the challenged provision and other statutory rules, and the rule infringes the requirement of norm clarity in several aspects, so Paragraph (1) of Article B of the Fundamental Law as well.
(a) The Constitutional Court proceeded from its practice related to the constitutional context of the conflict of laws at the same level in the system of the source of law, and it gave a summary on that in its Decision No. 43/2012. (XII. 20.). It reads as follows: The Constitutional Court declared in its Decision No. 35/1991. (VI. 20.) that "any inconsistent - or interpretatively inconsistent - legal settlement of specific relationships in life and facts does not constitute unconstitutionality on its own. Such a provision becomes unconstitutional only if it entails an infringement of any of the provisions of the Constitution, meaning that if the regulation with opposite content leads to unconstitutionality, e.g. if any of the provisions results in any unauthorised discrimination, the creation of any other unconstitutional situation or the limitation of any constitutional fundamental right. [...] The principle of the rule of law does not imply that the conflict of norms is excluded between laws of the same level." (DCC 1991, 175, 176.) Decision No. 21/2001. (VI. 21.) of the Constitutional Court specified this finding by stating: the requirement of legal certainty based on the constitutional fundamental value of the rule of law becomes infringed in case the conflict between the statutory rules of opposite content [...] cannot be resolved through the interpretation of the law by legal practitioners without prejudice to legal certainty.' (DCC 2001, 231, 235.)" (Reasoning [54])".
The Constitutional Court did therefore not annul the provision. The remarkable thing are the statements of principle summarised in the Decision, which is worth briefly quoting.
(b) The starting point of the body is its previous practice developed in terms of the rule of law, legal certainty and norm clarity. Pursuant to Decision No. 9/1992. (I. 30.) of the Constitutional Court, legal certainty is an indispensable element to the rule of law. Legal certainty obliges the state - and primarily the legislator - to ensure the clarity, unambiguity of the entirety of the law, each of its domains and the individual laws, and that they are predictable and foreseeable in their functioning to the recipients of the norm. In other words, legal certainty does not require the unambiguity of specific norms, but also the predictability of the functioning of specific legal institutions. Procedural safeguards are therefore essential in terms of legal certainty (DCC 1992, 59, 65.). The Constitutional Court also referred to its Decision No. 26/1992. (IV. 30.), where it pointed out that a meaningful and clear norm content of the law that is recognisable in the course of applying the law is a requirement originating from legal certainty (DCC 1992, 135, 142.)[50].
The interesting thing is that the Constitutional Court emphasised, even despite non-annulment: "in the case examined, concerns associated with the constitutional requirement of norm clarity apply. The challenged legislative requirements provide for the application of other, not precisely specified norms, which might cause uncertainty in the interpretation and application of the law. The relationship between two sentence parts in Section
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37/A(1) of the Settlement Act (establishment of the payment obligation of the parties "on the basis of the revised settlement" and "applying the rules settlement") is also a matter of interpretation. Furthermore, the scope of Section 15/A of the HUF Conversion Act may be established only it is interpreted jointly with the other provisions of the Act. Finally, determining the effect of the HUF Conversion Act on the decision of concrete lawsuits is also a complex task for legal practitioners"[51].
In other words: the concerns apply but do not reach the level of unconstitutionality. The Constitutional Court attempts to further elaborate and support this argument in its reasoning. Accordingly "[Examining the provisions on their own and merely in terms of language, the inaccuracy of syntax and the fact that the relationship between -and therefore the context of - the individual sentence parts and the norms in the affected and interrelated provisions can be identified only in a separate process of interpretation are indeed striking. As the Constitutional Court previously made a reference to the fact that 'the legislator is not only expected to provide a grammatically perfect series of sentences but to ensure the logical unity and non-technical nature of the norm - whereas this is the basis for applicability - , norm clarity is also a constitutional requirement on the basis of Paragraph (1) of Article B of the Fundamental Law; the same is explicitly set out in Section 2(1) of Act CXXX of 2010 on Legislation (hereinafter referred to as Legislation Act) (»The law must have a regulatory content that is unequivocally interpretable for the addressees as well.«)'."[52]
The Constitutional Court referred to the fact that, according to the practice of the Constitutional Court applied so far, "unconstitutionality applies if the content of the challenged law is unclear to an extent, or its provisions are so much controversial, that the interpretation of that law is insufficient for the resolution of unclarity"[53]. "This means that the Constitutional Court does not automatically establish the infringement of legal certainty even in case of a legal provision not formulated with the necessary accuracy either, if the uncertainty of the legislative provision can be resolved during the application of the act [Decision No. 26/1992. (IV. 30.) of the Constitutional Court, DCC 1992, 135, 142.].
Repeating and reinforcing these findings, Decision No. 24/2013. (X. 4.) of the Constitutional Court also emhasised that 'according to the practice of the Constitutional Court applied so far in relation to the requirement of norm clarity, laws must be formulated according to the rules of the Hungarian language, in a clear and non-technical way. Difficulties in interpreting laws must usually be resolved with the means applied by the legislator or the legal practitioners for interpreting the laws'."[54]
(c) This is the point in the Decision, where the Constitutional Court does not accept the issues of interpretation of the law as problems leading to an issue of constitutionality, but regards them as issues that can be resolved via the interpretation of the law, meaning that it refers the decision back to court competence.
The Constitutional Court has found that "attention must be drawn to the followings in the concrete case - having regard to this practice as well. Measures concerning foreign currency borrowers and embodying in laws have appeared in several acts. A series of acts concerning the subject wished to offer a normative solution to the problems arisen in relation to the loan agreements made in foreign currency or based on foreign currency (and partly based on HUF) and having grown to a problem affecting the entire society... These acts basically form a complex system and jointly outline the normative content that affects the solution of concrete, ongoing legal disputes as well. A normative solution is however always necessarily general. The courts proceeding in the lawsuits have the task to narrow down the decision of the case to the remaining disputed elements after the issues decided normatively"[55].
"In the judgment of the Constitutional Court, resolving the potential difficulties of interpreting the laws in relation to the challenged legislative provisions is undoubtedly a complex task for the legal practitioners, and it might necessitate the use of multiple methods of interpretation. The provisions can, at the same time, not be regarded as being that much unclear or controversial that they - infringing Paragraph (1) of Article B of the Fundamental Law - are uninterpretable or inapplicable right from the onset"[56].
Finally, the Constitutional Court reminds us that "in its practice, it refrains from taking a position on the relevance or legality of issues belonging to dogmatics of different branches of the law, or issues of interpreting the law exclusively"[57]. "The Constitutional Court may therefore not engage in any further analysis of the content of the challenged legislative provisions, and may not provide any substantive guidance for the application of the law. Furthermore, Article 25(3) of the Fundamental Law makes the assurance of unity in the application of law by the courts a constitutional duty of the Supreme Court (Curia)[58].
The lesson therefore is that the Constitutional Court tries to handle motions implying issues,
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difficulties of the interpretation of the law by referring them back to the courts with competence in the interpretation of the law, if the issues referred to in them do not reach the level of being in conflict with the Fundamental Law. The question is, to what extent is this solution used as means to avoid decision-making and to what extent does it imply the absence of any conflict with the Fundamental Law. As the Constitutional Court may decide on the latter, it is the responsibility of the members of this body to set the limit when making examinations in relation to Paragraph (1) of Article B of the Fundamental Law, i.e. which is stronger, the avoidance of decision-making or the intention to refuse due to the absence of any conflict with the Fundamental Law. A more general study of this would however require a separate study paper.
(d) Finally, I would make the following reference: the preservation of the norm (the absence of annulment) appeared in similar cases as well, with the establishment of a constitutional requirement allowed by the law.
In its Decision No. 3019/2017. (II. 17.), the Constitutional Court explicitly stated that "the Constitutional Court regarded the judicial concerns related to the uncertainties existing in relation to the interpretation of the challenged norm as basically substantiated, the motions were refused because, in the judgment of the Constitutional Court, there is a interpretation of the norm which is in accordance with the Fundamental Law." Having however regard to the fact that this interpretation became available only after familiarisation with the position of the legislator, the Constitutional Court decided for the application of Section 46(3) of the Constitutional Court Act, with a view to legal certainty. Pursuant to this provision, the Constitutional Court may establish constitutional requirements that originate from the regulation of the Fundamental Law, enforce the provisions of the Fundamental Law and must be complied with during the application of the law that is being examined or is applicable within the court procedure with a decision in a procedure implemented in the course of exercising its competence."
According to the Constitutional Court, the necessity for determining the constitutional requirement is supported by the circumstance that "there are, even now, large numbers of ongoing court proceedings concerning consumer loan agreement denominated in foreign currency. Furthermore, if the norm is interpreted and applied in conflict with any law of higher level during such procedures, then the Constitutional Court would not have the opportunity to resolve the situation which is otherwise in conflict with the Fundamental Law on the basis of a constitutional appeal, because the appeal can be based on the infringement of a right ensured in the Fundamental Law"[59].
The fact that Constitutional Judge István Stumpf did not consider the constitutional requirement as unambiguous in his dissenting opinion is an oddity of such issues. The constitutional judge set out that "I disagree with the constitutional requirement in this form ,because I do not regard it as unambiguous, hence, in my opinion, it might make the application of the law unpredictable"[60].
All this shows that the complexity of the regulation concerning foreign currency loans gives rise to the theoretical possibility of the infringement of legal certainty in many aspects. The provisions occurring in the interactions between the legislator, the courts and the Constitutional Court will probably cause headaches to these bodies in the future as well. ■
NOTES
* This paper has been made within the framework of the programmes initiated by the Hungarian Ministry of Justice to raise the standard of legal education.
[1] I studied the other constitutional arguments related to this topic in detail in my study titled "Issues of constitutionality related to the legislative settlement of the problems of foreign currency loans" (in Kodifikáció, 2015/1. www.kodifikator.hu) pp. 30-62
[2] The legislator intervened by way of amending laws (see the former Credit Institution Act for instance, the amendment of Section 210-210/A of Act CXII of 1996 on Credit Institutions and Financial Enterprises), and making new laws (introduction of final repayment, exchange rate cap). In addition the legislator attempted to solve the issue of the debtors with four laws in 2014: the Foreign Currency Act, Act XL of 2014 on the Rules of the Settlement Set out in the Foreign Currency Act and on Other Provisions (hereinafter referred to as the Settlement Act); Act LXXVIII of 2014 on the amendment of the Act CLXII of 2009 on consumer credits and of other relating acts (hereinafter referred to as Fair Banks Act), and Act LXXVII of 2014 on the settlement of matters relating to the currency conversion of certain consumer loan agreements and to interest rate rules (hereinafter referred to as HUF Conversion Act).
[3] The Hungarian Parliament adopted the Fair Banks Act and the HUF Conversion Act on 25 November 2014.
[4] Decision No. 34/2014. (XI. 14.) of the Hungarian Constitutional Court in the case of the judicial initiative (lawsuits of foreign currency loans) against Act XXXVIII of 2014 on the Settlement of Particular Issues Related to the Uniformity Decision of the Supreme Court (Curia) on Consumer Loans Provided by Financial Institutions.
[5] The texts of the motions and the decisions of the Constitutional Court are all available on the http://mkab.hu/devizahiteles-ugyek-attekintes website.
[6] Ildikó Kovács: Issues of constitutionality related to the legislative settlement of the problems of foreign currency loans. Kodifikáció 2015/1. (www.kodifikator.hu) pp 30-62; and Ildikó Kovács - Péter Tilk: Thoughts on the starting point for
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calculating the required preparation time. Jogtudományi Közlöny [Gazette of Legal Science], 2015/11.
[7] Retroactivity applies even if a law does not come into force with a retrospective effect, but the provisions of that law must be applied to the legal relationships established before the entry into force of the law, under an expressed instruction to do so [Decision No. 57/1994. (XI. 17.) and Decision No. 68/2006. (XII. 6.) of the Constitutional Court].
[8] József Petrétei: Magyarország alkotmányjoga I. Alapvetés, alkotmányos intézmények. [Constitutional Law of Hungary I. Fundamentals, Constitutional Institutions.] Kodifikátor Alapítvány [Kodifikátor Foundation], Pécs, 2013 (hereinafter referred to as Petrétei: The Constitutional Right of Hungary 1), page 93
[9] Decision No. 34/2014. (XI. 14.) of the Constitutional Court did not found the judicial motion to be substantiate regarding this requirement (either).
[10] Vilmos Peschka: The Retroactive Validity of Legal Norms. Acta Juridica Hungarica 1999/1-2. pp 9-15
[11] Until 26 July 2014.
[12] (a) the principle of clear and understandable formulation: its content is not clear or understandable to the consumer;
(b) the principle of itemised definition: the conditions of unilateral contract modification are not defined in an itemised fashion, meaning that the list of reasons is missing, or there is one but its list is only exemplary;
(c) the principle of objectivity: the conditions of unilateral modification are not objective, meaning that the party contracting the consumer has the means to make the condition apply, contribute to that and influence the extent of the change giving rise to the modification;
(d) the principles of effectiveness and proportionality: the conditions defined in the list of reasons do not effectively affect the interest rates, costs and fees or not to the extent of the change of circumstances;
(e) the principle of transparency: the consumer could not have foreseen at the application of which conditions and to what extent can additional charges be transferred to him/her;
(f) the principle of termination: the right of termination is not ensured for the consumer in case a contract modification applies or
(g) the principle of asymmetry: it excludes that the effect of any changes of conditions in favour of the consumer are enforced in favour of the consumer.
[13] According to Section 234(1) of the Civil Code, anybody can refer to the invalidity of a contract that is null and void without any limitation in time, unless an exception is made by the law, (even in the case of partial invalidity).
[14] In force at the time of contract conclusion: Act IV of 1959.
[15] Act CXII of 1996 on Credit Institutions and Financial Enterprises.
[16] In its previous practice, the Constitutional Court understood "established relationships" as substantive legal relationships established on the basis of substantive law, and established unconstitutionality in order to protect these legal relationships due to the infringement of retroactive legislation.
[17] Section 198(1) of the Civil Code.
[18] If it is terminated by fulfilment, for instance.
[19] The state of the Credit Institution Act before 1 August 2009.
[20] Section 210(3) of the Credit Institution Act: "In loan contracts with consumers and in financial leasing agreements only the interest rate, fees and commissions may be changed unilaterally to the disadvantage of the customer. Other conditions, including a listing of the grounds substantiating the unilateral modification of the terms and conditions of the contract, may not be altered unilaterally to the disadvantage of the customer. The creditor shall be able to exercise the right of unilateral modification if the objective reasons giving grounds for modification are fixed in the contract, and if the creditor has committed its pricing criteria in writing." Paragraphs (4)-(14) determine the substantive requirements of pricing principles and other rules of modification.
[21] Dissenting opinion of László Kiss: [289] 11. Agreeing with several motions, I also consider that it can be proven that the Act does not, contrary to the position of the Minister of Justice, give content to the concept of civil law invalidity, but gave a new definition to unfairness, being independent from the definition set out in Section 209(1) of the previous Civil Code and in Section 6:102(1) of the current Civil Code.
[22] Decision No. 34/2014. (XI. 14.) of the Constitutional Court: Reasoning [103].
[23] Decision No. 34/2014. (XI. 14.) of the Constitutional Court: Reasoning; Dissenting opinion of Péter Paczolay [347].
[24] These instruments to ensure judicial legal unity are for the courts, and are applicable in concrete, either ongoing or subsequently commenced, lawsuits.
[25] On the contrary, reasoning in [98] of the majority position of Decision No. 34/2014. (XI. 14.) of the Constitutional Court reads The measure of unfairness has not changed, the case is that already existing requirements have been enshrined in the law (based on the previous Civil Code, the judicial practice and the Directive). According to the previous (and new) Civil Code and the principles developed by the Curia, the Act has not changed the judgment of the fairness of the contract stipulations in question, but defined its, ab ovo existing, content in a differentiated manner within the legal context of the general clause. Remark: due to the stricter judicial practice.
[26] Decision No. 34/2014. (XI. 14.) of the Constitutional Court: Reasoning; citation from the findings of the dissenting opinion of Paczolay Péter, under Margin No. [345], [346].
[27] Compare: Point 6 of the dissenting opinion of László Kiss [281]: "Between 1 May 2004 and the entry into force of the Act, these criteria were not itemised either in such form or with such content or defined either in Hungarian law (including Decision No. 2/2014. for the Uniform Application of the Civil Law) or EU legislation and case-law, and these criteria were not found in any source of legal literature in the given period."
[28] In case of mortgages.
[29] Decision No. 34/2014. (XI. 14.) of the Constitutional Court: Moreover, the general clause concerning fairness in the Civil Code as lex generalis is specified by the sectoral acts considered as lex specialis.
[30] There had not been any lawsuits until 2006 and there has not been any judicial practice until 2011.
[31] The Fundamental Law of Hungary declares in its Foundation, in Paragraph (1) of Article B that Hungary is an independent, democratic, rule-of-law State.
[32] It is included in the previous Legislation Act. According to Section 2(2) of the current Act CXXX of 2010 on Legislation, "no legislation may establish any obligation, make any obligation more burdensome, take away or limit any right and declare any behaviour unlawful for the time preceding its entry into force."
[33] Dissenting opinion of László Kiss [287].
[34] Margin No. [284].
[35] Margin No. [36].
[36] Decision No. 34/2014. (XI.14.) Of the Constitutional Court; Dissenting opinion of Péter Paczolay [353].
[37] The majority position of the Constitutional Court refused the motion in this regard as well.
[38] Save for a constitutional appeal, because, in the practice of the Constitutional Court, the complainant is not directly affected in case of a decision for the unified interpretation of the
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law, since does not have any direct effect on him/her. See, for instance, Decision No. 7/2015. (III. 19.) of the Constitutional Court, and Order No. 3087/2015. (V. 19.) of the Constitutional Court. It is Constitutional Judge Ágnes Czine, who regularly gives a dissenting opinion on the practice.
[39] Motion registered with case No. III/00528/2014.
[40] Decision No. 34/2014. (XI. 14.) of the Constitutional Court: Dissenting opinion of László Kiss [280].
[41] As I have already mentioned: Section 2(2) of the Legislation Act provides that no law may establish any obligation for the time preceding its promulgation and declare any behaviour unlawful.
[42] Decision No. 34/2014. (XI. 14.) of the Constitutional Court: Dissenting opinion of László Kiss [283]: The loan lending financial institutions could therefore not think that the contract terms and conditions applied by them "can undoubtedly not be considered as unfair". This was however pointed out only by proposals, reports, recommendations and information materials which have no legally binding force, and their content did not appear in any law.
[43] December 2005 Report of the Hungarian Economic Competition Office; Recommendation No. 9/2006 of the Hungarian Financial Supervisory Authority; December 2006 Recommendations of the Expert Panel Examining Residential Financial Services; Report of the Hungarian National Office for the Judiciary in case No. 2958/2006; Report of the Hungarian National Office for the Judiciary in case No. 1474/2008; the Repot of the Hungarian Economic Competition Office, compiled for the session of the Hungarian Parliament of April 2008; Final Study Report of the Hungarian Economic Competition Office of 5 February 2009; May 2009 Information Material of the Hungarian Economic Competition Office for the Hungarian Parliament.
[44] Decision No. 34/2014. (XI. 14.) of the Constitutional Court: Reasoning [117].
[45] Act XL of 2014 on the Rules of the Settlement Set out in Act XXXVIII of 2014 on the Settlement of Particular Issues Related to the Uniformity Decision of the Supreme Court (Curia) on Consumer Loans Provided by Financial Institutions and on Other Provisions, as amended by Act LXXVIII of 2014 (hereinafter referred to as Act 2.)
[46] The legislator enacted Section 1(1a) with Act No. 2, including the concepts of contracts denominated in foreign currency, which the judicial motion missed.
[47] Decision No. 34/2014. (XI. 14.) of the Constitutional Court: Reasoning [115].
[48] Decision No. 34/2014. (XI. 14.) of the Constitutional Court: Reasoning [121]: the concept of "foreign currency" contract is used in several laws, a definition is however provided, on top of the Act analysed, in two laws only, the Credit Institutions Act [Section 267(1)] - identically to the previous Credit Institutions Act - and Government Decree No. 83/2010. (III. 25.) on the definition, calculation and publication of the annual percentage rate [Point 2 of Section 2(1)], these definitions are however not completely consistent.
[49] Decision No. 3098/2016. (V. 24.) of the Constitutional Court.
[50] The Decision referred to the fact that this practice is followed by the Constitutional Court even after the entry into force of the Fundamental Law. See, for instance, Decision No. 13/2013. (VI. 17.) and Decision No. 24/2013. (X. 4.) of the Constitutional Court.
[51] Decision No. 3098/2016. (V. 24.) of the Constitutional Court.
[52] The Constitutional Court quoted this finding from Decision No. 3047/2013. (II. 28.).
[53] Decision No. 1263/B/1993. of the Constitutional Court, Decision No. 3047/2013. (II. 28.) of the Constitutional Court.
[54] Decision No. 3098/2016. (V. 24.) of the Constitutional Court.
[55] Decision No. 3098/2016. (V. 24.) of the Constitutional Court.
[56] Decision No. 3098/2016. (V. 24.) of the Constitutional Court.
[57] Orders No. 3003/2012. (VI. 21.) and 3060/2016. (III. 22.) of the Constitutional Court.
[58] Decision No. 3098/2016. (V. 24.) of the Constitutional Court.
[59] Decision No. 3019/2017. (II. 17.) of the Constitutional Court
[60] Decision No. 3019/2017. (II. 17.) of the Constitutional Court
Lábjegyzetek:
[1] The Author is doctoral student, Faculty of Law, Department of Constitutional Law (University of Pécs).
Visszaugrás
