Czech Republic

Pillar III. Access to Remedy

Extrajudicial state resources [pages 42-43]

Other state bodies may also provide means of redress. These include both subsequent and preventive means.

Provisional protection permits various activities that may constitute a risk, in particular industrial operations with a major impact on the surrounding area. The public is entitled to participate in these proceedings. Arrangements must be in place so that public engagement is not complicated and so that the public is informed in plain language and in a readily accessible. On the other hand, this engagement must not be exploited for obstruction or to make proceedings longer and more expensive than they need to be.

In proceedings on offences, authorities tend to provide subsequent protection – if there is a breach of the law, an authority may, ex officio or on a proposal, order a remedy and, where appropriate, impose penalties. It is imperative for authorities to be steadfast in identifying and prosecuting breaches of the law and for the penalties to be effective and enforceable.

Ultimately, authorities may deal with several types of dispute. As a rule, such proceedings are faster and less formal than judicial proceedings. Dispute resolution by an authority should really be selected only in those areas where this makes sense in view of the nature of the dispute. The decision must subsequently be reviewable by a court.

Alternative and online dispute resolution [pages 49-52]

Judicial proceedings are inherently formalised and costly affairs. The calling of a judge is mainly to handle complex legal issues. Yet much of the agenda at the courts is filled with disputes that are legally and factually simple and could be dealt with by extrajudicial means. Ministry of Justice statistics indicate that half of the disputes that pass through the courts have a claim value of less than CZK 10,000. In other words, these are petty disputes. While it would be wrong to automatically dismiss petty disputes as simple in their facts, we can assume that this is the case in many instances. It may be more effective, in some cases, for these types of factually simpler disputes to be handled in certain special procedural regimes (e.g. by simplifying judicial hearings or restricting appeals), or a solution to them could be found out of court. If the courts no longer have to grapple with a surfeit of such disputes, they will have more capacity to address complex and fundamental legal issues.

However, it is difficult to estimate the actual number of such simplified disputes. Numerous low-value disputes do not even make it into court because the costs of proceedings would dwarf the claim value. Even plaintiffs who are sure of the legitimacy of their claim will not bring an action in a situation where the loss of the case and reimbursement of costs to the counterparty would make them destitute. Consequently, many such disputes are “latent”, though that is not to say that they are non-existent.

In this light, the state needs to offer a functioning, effective and efficient alternative running parallel to the judicial system. This alternative system could take over some of the agenda handled by the courts, thereby making it possible to speed up and streamline the judiciary. This system, in a way, can already be found, e.g. in the extrajudicial resolution of consumer disputes. However, it could also be developed in other areas (labour law and small claims).

Notwithstanding the above, any alternative dispute resolution system must be viewed genuinely as an alternative and must not hobble any party’s access to the courts. In this regard, when parties opt for alternative dispute resolution, this choice must primarily be based on their express, free and knowing consent, and also with consideration for the possible weaker position that either of them may be faced with (e.g. consumers). This should never hamstring judicial protection and the right to a fair trial.

The modernisation of the judiciary, the development of alternative dispute resolution methods and the adaptation of the existing system to the requirements of the modern age are topics being addressed by most countries around the world. The Czech Republic has a solid foundation on which to build, but the existing systems need to be carefully assessed and the best foreign examples need to serve as inspiration.

The Government of the Czech Republic recommends that businesses make use of vehicles for the alternative amicable resolution of disputes, support the formation and development of such vehicles, and offer them to their partners and customers as an option.

Current state of play:

• The Czech Trade Inspection Authority, the Energy Regulatory Office, the Czech Telecommunication Office, the Financial Arbitrator and certain other authorised entities form a state-guaranteed system of extrajudicial consumer dispute resolution.
• The Ministry of Industry and Trade may authorise further entities to engage in the extrajudicial resolution of consumer disputes should they so request and comply with statutory conditions.
• By law, vendors are required to inform consumers of the possibility of making use of alternative dispute resolution for consumer disputes.
• Legislation on alternative and extrajudicial consumer dispute resolution, as coordinated by the Ministry of Industry and Trade, is monitored and will be evaluated within two years after it has taken effect (i.e. in 2018).
• Czech law covers mediation, arbitration and the possibility of the judicial resolution of disputes in certain specific areas.
• Individual businesses may set up their own systems to settle disputes with customers.
• The Code of Civil Procedure already requires courts to attempt to find an amicable solution to disputes, and lets them recommend or order mediation. However, these concepts remain little used and have not been that successful. In 2016, a mere 2.4% of disputes ended with conciliation, and mediation was ordered in just 0.15% of disputes.
• The Ministry of Labour and Social Affairs is considering introducing vehicles for the extrajudicial and alternative resolution of disputes in labour-law cases.

Tasks:

• Raise awareness among consumers of the possibility of resolving consumer disputes extrajudicially.

Coordinator: Ministry of Trade and Industry

Deadline: Running

• Evaluate judicial and extrajudicial means of enforcing the law in the Czech Republic in cooperation with the representatives of businesses and other relevant stakeholders and, where appropriate, propose changes.

Coordinator: Ministry for Human Rights

Co-coordinators: Ministry of Justice, Ministry of Industry and Trade

Deadline: 31 December 2020

Administrative courts and their opportunities to review and annul follow-up decisions

It is often the case that complex authorisation proceedings do not take place as a whole, but comprise a many sub-proceedings and decisions that follow up on each other and are intertwined. If one decision is annulled by a special remedy (review proceedings or an administrative action), the downstream decisions formally remain in force even though they have been robbed of their basis. One example is building permit proceedings, where the issuance of a building permit hinges on the existence of a valid zoning decision. If a court annuls the zoning decision (or even part of the land-use plan forming the basis for the issuance of the zoning decision), the building permit remains in force. This falls foul of the principle of procedural economy (the annulment must take place in a separate process, even though this is a pure formality in the overwhelming majority of cases). It is also contrary to the requirement of legal certainty (the decision remains in force and enjoys the presumption of correctness, even though it obviously needs to be annulled), and is at odds with the principle of legality (because a decision that is clearly not legal remains in force).

Task:

• Analyse the finality and annulment of administrative decisions that are deprived of their legal basis in the form of the preceding decisions underlying their force. Evaluate how frequent such situations are and what the economic ramifications might be.

Coordinator: Ministry for Human Rights

Co-coordinators: Ministry of Regional Development, Ministry of Agriculture, Ministry of the Environment

Deadline: 31 December 2019

• Depending on the result of the analysis, add provisions to the Code of Procedure of Administrative Courts so that when a court annuls an administrative decision, it also automatically annuls, with no need for any motion, downstream decisions that cannot stand on their own (without the underlying decision), or propose another solution to the problem.

Coordinator: Ministry of Justice

Deadline: 31 December 2021