Legal News [May 2023]: Dismissal of an official for failure to comply with a statutory deadline

The Supreme Court has allowed that an official can be dismissed based on notice if they do not issue an administrative decision without undue delay, as the law requires them to do. Details of this judgment, along with other recent case law, can be found in our May Legal News.

  • In its resolution No. 23 Cdo 1594/2021, the Supreme Court addresses the beginning of the subjective limitation period for the right to damages consisting of the incurrence of a debt. This was a situation in which the actual damage was based on the obligation of the injured party to provide a third party with performance as a result of the injurious act of the wrongdoer. According to the old Civil Code, the damage occurred only at the moment when the performance was actually provided, and the injured party’s financial assets were thereby reduced. However, the current concept of the Civil Code explicitly states that damage may also consist of a debt. The condition for the creation of an obligation to compensate for damage can arise from the fact that the injured party’s assets are burdened by a debt, irrespective of how or whether the debt is discharged. The Supreme Court held that the circumstances relevant to the commencement of the subjective limitation period for the right to damages generally include awareness of the damage and the person liable for compensation. However, where the actual damage consists of the incurrence of a debt and the injured party chooses a right against the wrongdoer to be compensated by the wrongdoer, it is the injured party’s knowledge of the person of the wrongdoer and the incurrence of the debt, and not the eventual discharge of the debt or its maturity, which determines the start of the subjective limitation period for such a right.
  • In its most recent judgment  No. 21 Cdo 3330/2021, the Supreme Court addressed the question of whether, in the context of a dispute over the invalidity of termination of employment, an employee – an official of a territorial self-governing unit performing the activities of an administrative body – commits a breach of an obligation arising from legal regulations relating to the work they perform if they fail to issue an administrative decision within the “without undue delay” period, or even within the 30-day time limit. The Supreme Court held that, if nothing in the circumstances prevented such an employee from issuing a decision without delay or within another reasonable period of less than 30 days and they failed to issue such a decision, there would be a culpable failure on their part to comply with the time-limit. Nor can a different conclusion be reached if, at the same time, there were sudden unforeseeable medical reasons which prevented the employee from complying with the time limit, since they could have taken the decision in question earlier, i.e. before those medical reasons arose.
  • In the following, we provide a summary of an earlier Supreme Court resolution No. 27 Cdo 1744/2022. In the proceedings, the statutory executive deleted from the Commercial Register sought to have the reasons deleted for which they should have been removed from the office of statutory executive by the companys general meeting and which were listed in the Commercial Register under “other facts”. The Supreme Court concluded, using the argument “a maiori ad minus” (from the greater to the lesser), that if such a person is entitled to request a change of the entry in the case of their removal from the Commercial Register, they must also be entitled to request a change (deletion) of the entry of the reasons for which they were removed from the Commercial Register, or in the case of removal from the office of statutory executive by the general meeting, also the reasons for which they should have been removed.
  • In its decision No. 25 Cdo 446/2022, the Supreme Court confirmed its previous decision-making practice regarding the limitation of the right to compensation for the loss of earnings after the end of incapacity for work (under the old Civil Code). It recalled that in civil law relations, certain claims which are in the nature of a recurring performance, are time-barred as a whole, not just in relation to individual periodic considerations. This is the case, for example, with the claim for compensation for the loss of earnings after incapacity for work or disability, provided in the form of a pension.
  • The Supreme Court addressed the question of the conditions under which an employer may terminate an employment relationship with an employee by redundancy notice in its most recent judgment No. 21 Cdo 3524/2022. The Supreme Court confirmed, in accordance with its previous decision-making practice, that redundancy is established even if the activities corresponding to the eliminated position will continue to be performed in a newly created position to which the activities of the other two eliminated positions will be transferred at the same time, namely by an external contractor. The determining factor is a reduction in staff in order to increase efficiency, i.e. not the employer’s continuing need for these activities, but the fact that the essence of the organisational change adopted was that the activities in question should be carried out by one person instead of three employees.
  • From the older decisions, we present a summary of several judgements of the Constitutional Court. According to judgment No. Pl. ÚS 17/22, the obligation of financial institutions to establish and maintain a protected account free of charge (pursuant to Section 304c(1), third sentence, of the Civil Procedure Code) is not an unconstitutional restriction of the right to do business guaranteed in Article 26(1) of the Charter, nor is it an overstepping of the limits resulting from Article 4(4) and Article 26(2) of the Charter. This is because the obligation does not interfere with the very core of the right to conduct a business, pursues a legitimate aim, and has chosen reasonable and not arbitrary means to achieve that aim. The Constitutional Court stated that if the legislator prioritises the protection of the obliged persons at the expense of the financial institutions and their – mainly property – interests, the restriction of their business activities cannot be considered illegitimate.
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