EUR;CoE;EU;CECC;JCCJ;WCCJa) Hungary / b) Constitutional Court / c) / d) 20-03-2014 / e) 8/2014 / f) Interpretation of the Fundamental Law regarding foreign-currency loan contracts / g) Magyar Közlöny (Official Gazette), 2013/23 / h) .
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Constitutional Justice - Types of claim - Claim by a public body - Executive bodies.
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General Principles - Certainty of the law.
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Fundamental Rights - Economic, social and cultural rights - Freedom of contract.
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Headnotes:
A legal regulation may, in exceptional cases, where there have been significant and unanticipated changes to the circumstances that surrounded the conclusion of the contracts amend the content of contracts that had been concluded before it came into force.
Summary:
I. The government had asked the Constitutional Court for constitutional review regarding a problem that had arisen in the context of foreign-currency loans. The petition referred to unexpected and excessive changes in the rate of exchange and increases in the instalment payment of the loans. These were now causing problems for broad swathes of society.
The government noted in its petition that the Constitutional Court must interpret the Fundamental Law against any abuse of dominant position and the protection of the rights of consumers. The government queried the constitutionality of those contractual conditions which are defined unilaterally and which cause significant disadvantage for consumers, along with the judicial verdicts which confirm them or those legal provisions which are the basis of these judgments, against the background of the above provisions of the Fundamental Law. It also asked for an interpretation from the Constitutional Court of the right to human dignity and legal certainty in order to define in which constitutional conditions existing contracts can be modified by law.
II. The Constitutional Court noted that under the Fundamental Law, the State is under an obligation to create and maintain an institutional system which protects the interests of consumers and to act against any abuse of dominant position; and to adopt legal regulations to ensure the rights of consumers. Consumer rights in private contractual relations are not enforceable directly from the Fundamental Law; intermediate legal regulations are needed. The specific features of judicial verdicts that may cause unconstitutionality (based on the provision on the protection of consumer rights) cannot be defined within the competence of the interpretation of the Fundamental Law.
It also observed that although the Fundamental Law ensures freedom of contract, this does not mean that concluded contracts can never be modified. In exceptional cases, where significant and unanticipated changes have occurred to the circumstances surrounding the conclusion of the contract, amendments can be made to the content of those contracts that had been made before the entry into force of the legal regulation concerned. The Constitutional Court explained that the requirements of legal certainty, freedom of contract and trust in the fulfilment of concluded contracts will be satisfied provided that the State only modifies the content of the contracts by law under the same conditions which must apply in cases of judicial amendment. Any amendments must take the equitable interests of both parties into account and weigh the various interests, in the light of the new circumstances.
III. Justices Imre Juhász, Barnabás Lenkovics and László Salamon attached a concurring opinion and Justice Béla Pokol attached a dissenting opinion to the decision.
Hungarian.