Lt

On dismissing the instituted legal proceedings

Case No. 8a/94

  THE CONSTITUTIONAL COURT OF
THE REPUBLIC OF LITHUANIA

 D E C I S I O N

On the petition filed by a group of the Seimas members requesting an investigation into whether the Resolution of the Government of the Republic of Lithuania (No. 421) “On the Reregistration of Inter-economic Enterprises and Use of Share Contributions in Agricultural Enterprises”, as well as its Resolution (No. 422) “On the Rights and Obligations of Heads of Agricultural Enterprises During the Privatisation Period”, both adopted on 12 October 1991, are in the compliance with the Constitution of the Republic of Lithuania

 5 July 1995

The Constitutional Court of the Republic of Lithuania, composed of the Justices of the Constitutional Court: Algirdas Gailiūnas, Kęstutis Lapinskas, Zigmas Levickis, Vladas Pavilonis, Pranas Vytautas Rasimavičius, Stasys Stačiokas, Teodora Staugaitienė, Stasys Šedbaras, and Juozas Žilys

The secretary of the hearing—Rolanda Stimbirytė

The Constitutional Court of the Republic of Lithuania, in its procedural sitting, considered the petition submitted by a group of members of the Seimas requesting an investigation into whether the Resolution of the Government of the Republic of Lithuania (No. 421) “On the Reregistration of Inter-economic Enterprises and Use of Share Contributions in Agricultural Enterprises”, as well as its Resolution (No. 422) “On the Rights and Obligations of Heads of Agricultural Enterprises During the Privatisation Period”, both adopted on 12 October 1991, are in the compliance with Articles 23, 29, 46, 48 and 95 of the Constitution of the Republic of Lithuania.

The Constitutional Court

has established:

A group of members of the Seimas, the petitioner, has applied to the Constitutional Court requesting an investigation into whether the Resolution of the Government of the Republic of Lithuania (No. 421) “On the Reregistration of Inter-economic Enterprises and Use of Share Contributions in Agricultural Enterprises” (Official Gazette Valstybės žinios, 1991, No. 32-883), as well as its Resolution (No. 422) “On the Rights and Obligations of Heads of Agricultural Enterprises During the Privatisation Period” (Official Gazette Valstybės žinios, 1991, No. 32-884), both adopted on 12 October 1991, are in compliance with Articles 23, 29, 46, 48 and 95 of the Constitution of the Republic of Lithuania according to contents of norms, as well as to the procedure of adoption and signing thereof.

In the process of the preparation of the case for the hearing the Government have been asked for their opinion concerning the compliance of said resolutions of the Government with Articles 23, 29, 46, 48 and 95 of the Constitution of the Republic of Lithuania according to contents of norms, as well as to the procedure of adoption and signing thereof. On the commission of the Government answers have been presented by the Minister of Agriculture, the Minister of Justice and the Government Secretary of the Republic of Lithuania.

It is affirmed in the official letter of the Minister of Agriculture that “said resolutions of the Government contradicted the provisions of Article 44 of the Provisional Basic Law of the Republic of Lithuania, being in force during their adoption, which guaranteed all ownership entities the possibility of managing independently the objects which belonged to them by the right of ownership, to use them and dispose of them in accordance with the laws of Lithuania, stating that equal remedies were established for all ownership entities. Upon loss of validity of the Provisional Basic Law of the Republic of Lithuania (2 November 1992), said contradictions have remained in Article 23 of the Constitution of the Republic of Lithuania which establishes that property is inviolable, and the rights of ownership are protected by law”.

In the official letter of the Minister of Justice addressed to the Government, which has been submitted to the Constitutional Court, in addition, it is stated that government resolution No. 422 of 12 October 1991 “contradicted the norms of the Civil Code of the Republic of Lithuania, being valid at that time, as well as Article 44 of the Provisional Basic Law of the Republic of Lithuania”. It is also emphasised in this official letter that “taking into consideration the set forth circumstances, it would be possible to declare said resolutions of the Republic of Lithuania null and void, though such declaration would have no influence on the validity of sale and purchase agreements, concluded in the process of privatisation, as well as of other legal relations”.

It is confirmed in the Government Secretary’s official letter concerning the procedure of adoption of these resolutions that “said questions have not been included into the agenda and minutes of the sitting of the Government, therefore, these documents are not available.”

The Constitutional Court

holds that:

According to Article 105 of the Constitution and Article 1 of the Law on the Constitutional Court, the Constitutional Court shall consider and decide the conformity of laws and other acts, adopted by the Seimas, with the Constitution, as well as the conformity of acts, adopted by the President of the Republic and the Government, with the Constitution and the laws. Thus, the Constitutional Court shall consider cases concerning the conformity of valid legal acts with the Constitution and the laws.

After restoration of the independent state of Lithuania the economic reform, the essence of which was the transition from administrative-command economy to market economy by returning the institution of the right of private ownership into the law system of Lithuania, was started to carry out. The legislature chose the way of privatisation of the state and social property, as well as of restoration of ownership rights violated in the occupation years. Not only the property legal regime but also the system of economic relations’ entities and legal status thereof had undergone changes. On 8 May 1990, the Republic of Lithuania’s Law on Enterprises (Official Gazette Valstybės žinios, 1990, No. 14-395) was adopted, in which new kinds of these economic entities, their status and forms of activity, as well as the grounds and procedure of liquidation and reorganisation of former economic entities were established. It was established in the Supreme Council Resolution (No. 1-197) “On the Procedure for the Entry into Effect of the Republic of Lithuania’s Law on Enterprises” (Official Gazette Valstybės žinios, 1990, No. 14-396) that all enterprises which had functioned till the adoption of the Law on Enterprises had to reregistered themselves according to that law. Economic activity of non-reregistered enterprises was banned.

The reorganisation of agricultural enterprises and the privatisation thereof were also regulated by means of other laws. On 16 April 1991, the Law on Agricultural Companies (Official Gazette Valstybės žinios, 1991, No. 13-328) and the Supreme Council Resolution (No. 1-1223) “On the Entry into Force of the Republic of Lithuania’s Law on Agricultural Companies” (Official Gazette Valstybės žinios, 1991, No. 13-329) were adopted. It was established in this resolution that “kolkhozes and soviet farms may be reorganised into agricultural companies upon privatisation of their property in accordance with the laws of the Republic of Lithuania”. The status of agricultural enterprises subject to privatisation was established in the Law on the Privatisation of Property of Agricultural Enterprises, adopted on 30 July 1991 (Official Gazette Valstybės žinios, 1991, No. 24-637). In the Supreme Council Resolution (No. 1-1629) “On the Procedure for the Entry into Force of the Law on the Privatisation of Property of Agricultural Enterprises” (Official Gazette Valstybės žinios, 1991, No. 24-638), adopted on 30 July 1991 together with the above-mentioned law, the Government was commissioned to establish the privatisation procedure for agricultural enterprises.

The impugned government resolutions Nos. 421 and 422 of 12 October 1991 were adopted, while implementing the economic reform, as executive acts of one-off (ad hoc) validity. Government resolutions are acts of the application of the norms of law, irrespective of the fact whether these acts are of one-off (ad hoc) or permanent validity (the Constitutional Court’s ruling of 15 July 1994 in case No. 1/94; Official Gazette Valstybės žinios, 1994, No. 56-1103). The main difference in their validity time is that the acts of permanent validity are applied till they are not repealed by the established procedure, while acts of temporary validity are applied only for one legal relation (individual acts) or for a group of clearly defined legal relations by essentially changing their contents. For instance, such are acts of foundation, liquidation or reorganisation, which change the factual state of an entity in accordance with its legal status established in law. Acts of temporary validity are invalidated after their application, since legal relations, which appear on their basis, are already regulated by other legal acts. Acts of permanent validity are laws which consolidate new contents of legal relations. It should be noted that the system of economic relations, created during the economic reform, and legal status as well as activity of their entities, established already prior to the enforcement of the Constitution and after its adoption, are being further developed and regulated by law. After the adoption of the impugned government resolutions, the legislature changed the factually formed system of economic entities and the general status thereof neither prior to the enforcement of the Constitution nor after its coming into force, i.e. it factually recognised their legality.

While carrying out privatisation, while executing said laws, other legal acts, as well as the impugned government resolutions during the transitional period of essential reorganisations of economic relations, agricultural enterprises acquired quite a different status, i.e. resolutions Nos. 421 and 422 were executed. The changed status of agricultural enterprises was consolidated by means of said laws as well as their amendments made in 1991–1995 (Amendments to the Law on Enterprises—Official Gazette Valstybės žinios, 1991, Nos. 5-128, 32-867; 1992, Nos. 20-590, 33-1009; 1993, Nos. 4-75, 20-492, 25-581, 32-729; 1994, Nos. 8-119, 14-232, 30-533, 55-1047, 59-1163, 94-1836; 1995, Nos. 3-38, 10-206, 10-207, 39-964, 44-1074; amendments to the Law on Agricultural Companies—Official Gazette Valstybės žinios, No. 14-386, 1992; 1993, Nos. 7-140, 52-997, 62-1169; 1994, Nos. 1-1, 100-1998; amendments to the Law on the Privatisation of Property of Agricultural Enterprises—Official Gazette Valstybės žinios, 1992, No. 14-385; 1993, No. 13-311, etc.). At present their status is also consolidated in the Civil Code (Chapter III of Part 2), the Law on Agricultural Companies, the Law on Land (Official Gazette Valstybės žinios, 1994, No. 34-620), as well as in other laws and acts of the Government.

Government resolutions Nos. 421 and 422 of 12 October 1991 are executive acts of one-off validity which were adopted, executed and, though they were not formally annulled, in fact they were voided even prior to the entry into force of the Constitution, because:

1) such entities of legal relations, for which the norms of said resolutions were fixed, disappeared on the basis of laws;

2) after new social relations have been formed in agriculture, no regulation subject, for which they were designated, exists.

Article 2 of the Republic of Lithuania’s Law “On the Procedure for the Enforcement of the Constitution of the Republic of Lithuania” provides: “Laws, other legal acts, or parts thereof which were in effect on the territory of the Republic of Lithuania prior to the adoption of the Constitution of the Republic of Lithuania, shall be effective provided that they do not contradict the Constitution and this law, and shall remain effective until they are either declared null and void or coordinated with the provisions of the Constitution.” Thus, the procedure for coordination of acts, being effective after coming into force of the Constitution, with the Constitution itself, is established in this law. Meanwhile, the impugned Government acts were already executed and were voided even prior to the enforcement of the Constitution. Neither the legislature nor the Government settled the question of nullification of these resolutions. On the contrary, the legislature and the Government further regulated the activity of the economic entities, which appeared after the execution of said resolutions, by law and other legal act adopted both prior to the enforcement of the Constitution and after its coming into force.

There are no legal arguments enabling one to evaluate the conformity of the impugned government resolutions with the Constitution in accordance with their contents, as well as according to the procedure of adoption and signing thereof, since upon the execution of said acts, they were voided even prior to the adoption of the Constitution.

Taking into consideration that the validity of the impugned government resolutions is expired, the Constitutional Court states that this is the basis for the dismissal of the legal proceedings commenced in the case.

Conforming to Article 69 of the Law on the Constitutional Court of the Republic of Lithuania, the Constitutional Court of the Republic of Lithuania adopts the following

decision:

To dismiss the legal proceedings commenced in this case.

Justices of the Constitutional Court:

 Algirdas Gailiūnas                           Kęstutis Lapinskas                           Zigmas Levickis

 Vladas Pavilonis                              Pranas Vytautas Rasimavičius         Stasys Stačiokas

 Teodora Staugaitienė                       Stasys Šedbaras                               Juozas Žilys