Precedent system in Hungary?

One of the first things a law student learns at university is the structure of the different legal systems, a topic in which professors place particular emphasis on the contrast between the continental and the common law legal system. The two legal systems differ significantly in several aspects, but the main flagship of the differences is the existence or non-existence of the precedent system. Perhaps the simplest way to explain the difference is that while in common law countries courts do not necessarily base their judgments on laws and regulations but on earlier (up to 100 years) court decisions, while in continental legal systems court decisions are based on laws, statues and other regulations. Until now, Hungary has traditionally belonged to the group of countries following the continental legal system, however, the changes presented on 1 April 2020, introduced a limited precedent system, thus bringing the Hungarian legal system closer to the system of common law countries.

In order to understand the new system, it is worth briefly reviewing the Curia's current practice of unifying the application of the law and the previous system of decisions and opinions issued by the Curia. Until now, there have been resolutions concerning legal uniformity, decisions of principle (which had different names over the years - the best known are EBH and EBD), resolutions of case law analysis groups, opinions of Collegiums, and individual court decisions. Of these, only the resolutions concerning legal uniformity were binding on all judicial forums, and lower courts could not deviate from the decisions of principle.

From 1^st April 2020, the system underwent a significant change and moved towards the precedent system. Resolutions concerning legal uniformity and the opinions of Collegiums remained unchanged, but decisions of principle and the resolutions of case law analyzing groups ceased to exist. The most significant change is that all individual decisions published in the Compendium of Court Decisions have become precedent and the courts cannot, as a general rule, deviate from the Curia’s legal interpretation published in them. If the lower courts still wish to deviate from the legal interpretation of the Curia, they must explicitly state the reasons for the deviation in the reasoning part of the judgment. We may wonder whether the Curia can differ from its own previous interpretation of the law. Of course, the answer to this is not, if the Curia still deems the derogation necessary, it must initiate a legal unity proceeding.

As a result of the introduction of the limited precedent system, thousands of court decisions have become binding on the courts, the full knowledge of which cannot be expected from the them, so in some cases judges may inadvertently deviate from the Curia's interpretation of the law. It serves to remedy this problem, in addition to appeal and review procedures, the newly introduced remedy procedure, the Unity Complaint. On the one hand, an application for a Unity Complaint may be submitted if a lower court deviates from the Curia's previous interpretation of the law but the Curia refuses the application for a review procedure, or although the Curia conducts the review procedure, but upholds the lower court's deviation from the previous interpretation. On the other hand, a Unity Complaint can also be submitted if the Judicial Council of the Curia deviates from the previous decision of the Curia in a matter of law and do not initiate a legal unity proceeding.

However, the present regulation of the newly introduced remedy procedure raises a number of issues from a procedural point of view. It is not really clear to what extent the regulation expects an active role from the parties or the courts involved in the case, whether the law considers it the task of the parties or the courts to find the relevant court decision. Nor is it clear how actively the parties need to search for court decisions, whether they have an obligation, for example, to review the available court decisions as early as possible in the preparatory phase of the first instance proceeding. Rather, the newly introduced system suggests that at any time during a given procedure we may refer to a court decision that we have just found in our favor, so in a Unity Complaint procedure a party may refer to a court decision that was unnoticed by the parties and judges acting earlier in the lawsuit.

The problem outlined above is reinforced by the fact that there is no systematic, easy-to-search database of court decisions in Hungary. Although a decision-search tool is available on the Curia's website, but it is kind of outdated and does not really meet the expectations of modern legal society. This decision-search tool is accessible to all, and includes tens of thousands of court decisions without any kind of system, so to find a decision that helps our case is a matter of blind luck or a thorough review of all court decisions that are hundreds of thousands of pages long. The latter is obviously not to be expected from courts, parties and legal representatives either.

The new system, while aimed at standardizing the application of the law, may not, however, do so in the appropriate ways, as the new remedy procedure will also significantly increase the power of the President of the Curia. It does this by electing the members of the Legal Unity Council deciding on Unity Complaints, by the President of the Curia and chairing it himself (or the Vice-President of the Curia), significantly increasing the President's participation in the judgments against his administrative role. More than half a year after the amendment came into force, which was obviously not enough to prove or disprove the effectiveness of the new system. However, it is already clear that, from a procedural point of view, it would be necessary to review the new system and set more detailed rules to help courts, parties and legal representatives.