LANDMARK JUDGMENT OF THE PROVINCIAL ADMINISTRATIVE COURT IN OPOL - IS THE TREASURY FACING AN EPIDEMIC OF COMPENSATION CLAIMS ? 8 January 2021
On 27 October 2020. Voivodship Administrative Court in Opole, in case ref. no. II SA/Op 219/20, issued a judgment that can be assessed even in terms of a „precedent” familiar from the US judiciary.
The cited judgment was made in the following factual situation. By order of 19 April 2020. [1] The government - due to the ongoing epidemic - banned certain business activities, including the closure of hairdressing salons. In view of the breach of these restrictions by one of the entrepreneurs from the Opolskie Voivodeship, the authorities of the Sanitary Inspectorate (hereinafter also: Sanepid) imposed a fine of PLN 10,000.00 on him. The decision in question was given the order of immediate enforceability. However, under the ruling mentioned at the beginning, the fine was cancelled and the proceedings conducted by the Sanitary Inspectorate were discontinued in its entirety as groundless.
The key issue in this case is not the ruling itself, but the recently published justification. This is because the WSA in Opole agreed with the entrepreneur primarily on the grounds that the aforementioned regulation, on the basis of which the Sanitary Inspectorate authorities imposed this penalty, in the court's view, may not be used, as the mode of introduction of these provisions was incorrect and as such led to violations of basic constitutional standards and rights in the area of freedom of economic activity. For this reason, the WSA, invoking the principle of judicial independence[2], declined to apply that regulation. Thus - in the absence of legal regulations that could lead to a finding that the entrepreneur had violated the law - the WSA considered that there were no grounds to punish him.
Although the judgment of 27 October 2020 is not final, it already sends a significant warning signal to the government - signalling the numerous compensation lawsuits that entrepreneurs may initiate against the Treasury[3] in relation to the losses suffered as a result of the closure of their business for months. A closure based on regulations essentially identical to the one assessed by the WSA in Opole as violating basic constitutional standards and not, in the court's view, grounds for restrictions on business.
Under Polish law, court judgments do not have the force of law. Therefore, the verdict of the WSA directly resolves only this specific case of an entrepreneur from the Opolskie Voivodeship. However, given the importance of the argumentation presented in the justification of this ruling, it should be expected that it will be commonly cited by entrepreneurs punished for running their businesses in violation of subsequent bans, and thus the position taken by the WSA in Opole may soon be copied by other courts.
It is therefore worth looking at the most important parts of this justification. The WSA in Opole indicated that in accordance with Article 232 of the Constitution, the Council of Ministers may introduce a state of natural disaster for a specified period of time in order to prevent the effects of natural disasters. However, the court noted that The Council of Ministers has abandoned the formal and prescribed introduction of a state of natural disaster under Article 232 of the Polish Constitution. Therefore, all constitutional and legislative principles (...) apply to the legal regulation of limitations on human and civil rights and freedoms. Accordingly, extraordinary circumstances may not be invoked to introduce restrictions on human freedoms and rights, justifying specific legal solutions and these circumstances far-reaching restrictions on civil liberties introduced in the form of regulations cannot be justified.
In the opinion of the panel The prohibition of the economic activities specified therein by successive regulations from 31 March 2020 certainly encroaches on the essence of freedom of economic activity. Meanwhile, in the absence of any of the states of emergency listed in the Polish Constitution, no state authority should encroach on a matter which constitutes the essence of freedom of economic activity.
The WSA stressed emphatically that in only provisions of a technical nature that are not essential to the rights or freedoms of the individual should be included in the regulation (…).
The Opole court was more than critical of the activities of the government and the Sejm in terms of the restrictions imposed on citizens, pointing out that it was against the duty of special care in the field of lawmaking concerning such an important value as the freedom to conduct business, the legislator has enacted ordinances, i.e. acts of a rank lower than the law, in order to restrict fundamental human freedoms and rights during an epidemic (...). This gives the government the opportunity to shaping in a regulation in any way, without substantive guidance from the law, the sphere of fundamental rights or freedoms of the individual.
The Administrative Court had no doubt that the restrictions imposed on entrepreneurs do not have a proper legal basis. The consequences of the cited judgment may therefore be very far-reaching. Although there is still a very long way to go for persons wishing to seek compensation from the State Treasury, they have just been provided with the first „tool” that may significantly help them. In this context, it is also worth noting - following the WSA in Opole - that courts have the possibility to refuse to apply the Council of Ministers' regulation, which the public administration authorities could not do. The situation analysed is therefore the best illustration of the importance of a judiciary that is independent of those in power and of judges who are independent, in particular of politicians, in order to defend citizens' rights.
[1] Ordinance of the Council of Ministers of 19 April 2020 on the establishment of certain restrictions, orders and prohibitions in connection with the occurrence of an epidemic state.
[2] See Article 178 of the Polish Constitution
[3] See 417(1) of the Civil Code governing the liability of the State for issuing an unlawful normative act, including a regulation
On 27 October 2020. Voivodship Administrative Court in Opole, in case ref. no. II SA/Op 219/20, issued a judgment that can be assessed even in terms of a „precedent” familiar from the US judiciary.
The cited judgment was made in the following factual situation. By order of 19 April 2020. [1] The government - due to the ongoing epidemic - banned certain business activities, including the closure of hairdressing salons. In view of the breach of these restrictions by one of the entrepreneurs from the Opolskie Voivodeship, the authorities of the Sanitary Inspectorate (hereinafter also: Sanepid) imposed a fine of PLN 10,000.00 on him. The decision in question was given the order of immediate enforceability. However, under the ruling mentioned at the beginning, the fine was cancelled and the proceedings conducted by the Sanitary Inspectorate were discontinued in its entirety as groundless.
The key issue in this case is not the ruling itself, but the recently published justification. This is because the WSA in Opole agreed with the entrepreneur primarily on the grounds that the aforementioned regulation, on the basis of which the Sanitary Inspectorate authorities imposed this penalty, in the court's view, may not be used, as the mode of introduction of these provisions was incorrect and as such led to violations of basic constitutional standards and rights in the area of freedom of economic activity. For this reason, the WSA, invoking the principle of judicial independence[2], declined to apply that regulation. Thus - in the absence of legal regulations that could lead to a finding that the entrepreneur had violated the law - the WSA considered that there were no grounds to punish him.
Although the judgment of 27 October 2020 is not final, it already sends a significant warning signal to the government - signalling the numerous compensation lawsuits that entrepreneurs may initiate against the Treasury[3] in relation to the losses suffered as a result of the closure of their business for months. A closure based on regulations essentially identical to the one assessed by the WSA in Opole as violating basic constitutional standards and not, in the court's view, grounds for restrictions on business.
Under Polish law, court judgments do not have the force of law. Therefore, the verdict of the WSA directly resolves only this specific case of an entrepreneur from the Opolskie Voivodeship. However, given the importance of the argumentation presented in the justification of this ruling, it should be expected that it will be commonly cited by entrepreneurs punished for running their businesses in violation of subsequent bans, and thus the position taken by the WSA in Opole may soon be copied by other courts.
It is therefore worth looking at the most important parts of this justification. The WSA in Opole indicated that in accordance with Article 232 of the Constitution, the Council of Ministers may introduce a state of natural disaster for a specified period of time in order to prevent the effects of natural disasters. However, the court noted that The Council of Ministers has abandoned the formal and prescribed introduction of a state of natural disaster under Article 232 of the Polish Constitution. Therefore, all constitutional and legislative principles (...) apply to the legal regulation of limitations on human and civil rights and freedoms. Accordingly, extraordinary circumstances may not be invoked to introduce restrictions on human freedoms and rights, justifying specific legal solutions and these circumstances far-reaching restrictions on civil liberties introduced in the form of regulations cannot be justified.
In the opinion of the panel The prohibition of the economic activities specified therein by successive regulations from 31 March 2020 certainly encroaches on the essence of freedom of economic activity. Meanwhile, in the absence of any of the states of emergency listed in the Polish Constitution, no state authority should encroach on a matter which constitutes the essence of freedom of economic activity.
The WSA stressed emphatically that in only provisions of a technical nature that are not essential to the rights or freedoms of the individual should be included in the regulation (…).
The Opole court was more than critical of the activities of the government and the Sejm in terms of the restrictions imposed on citizens, pointing out that it was against the duty of special care in the field of lawmaking concerning such an important value as the freedom to conduct business, the legislator has enacted ordinances, i.e. acts of a rank lower than the law, in order to restrict fundamental human freedoms and rights during an epidemic (...). This gives the government the opportunity to shaping in a regulation in any way, without substantive guidance from the law, the sphere of fundamental rights or freedoms of the individual.
The Administrative Court had no doubt that the restrictions imposed on entrepreneurs do not have a proper legal basis. The consequences of the cited judgment may therefore be very far-reaching. Although there is still a very long way to go for persons wishing to seek compensation from the State Treasury, they have just been provided with the first „tool” that may significantly help them. In this context, it is also worth noting - following the WSA in Opole - that courts have the possibility to refuse to apply the Council of Ministers' regulation, which the public administration authorities could not do. The situation analysed is therefore the best illustration of the importance of a judiciary that is independent of those in power and of judges who are independent, in particular of politicians, in order to defend citizens' rights.
[1] Ordinance of the Council of Ministers of 19 April 2020 on the establishment of certain restrictions, orders and prohibitions in connection with the occurrence of an epidemic state.
[2] See Article 178 of the Polish Constitution
[3] See 417(1) of the Civil Code governing the liability of the State for issuing an unlawful normative act, including a regulation