23 July 2004 № D-174/2004
The Constitutional Court of the Republic of Belarus comprising of the Presiding Officer - Chairman of the Constitutional Court G.A. Vasilevich, judges T.S. Boiko, G.A. Vorobei, V.V. Podgrusha, A.A. Sarkisova, A.G. Tikovenko, G.B. Shishko, V.Z. Shuklin on the grounds of part four of Article 122 of the Constitution of the Republic of Belarus has examined the motion on legality of giving retrospective action Decision of Minsk city executive committee as regards the norms setting reducing coefficients to the norms of planned accumulation and burden costs.
Having analyzed the relevant provisions of the Constitution of the Republic of Belarus, the Civil Code of the Republic of Belarus, the Laws of the Republic of Belarus "On local government and self-government in the Republic of Belarus", "On enforceable legal acts of the Republic of Belarus" and other acts of legislation, the Constitutional Court found the following.
Decision of Minsk city executive committee of 4 March 2004 No. 453 "On results of execution of the budget of the city of Minsk and on situation of control and economic work for 2003, tasks on execution of Decision of Minsk city council of deputies of 30 December 2003 No. 72 and economy of budgetary funds in 2004" contains the orders with respect to the Heads of regions, Heads of committees, departments of Minsk city executive committee, organizations of communal property of the city of Minsk to secure economical and rational use of budgetary funds with special attention to strengthening control over spending extra-budgetary recourses and funds allocated for carrying out capital repair of the housing stock, streets of the town, repair and development of yard territories and other objects (sub-item 3.1 of point 3); to carry out regular work on reducing the expenditure at the expenses of cost cutting and cost lowering of the rendering services, as well as creditor and debtor indebtedness (sub-item 3.2 of point 3).
There have been also determined that the committees, departments of Minsk city executive committee, administrations of regions, legal entities financing from the budget shall have no right to conclude the contracts on goods delivery, carrying out oа works (service rendering) which are not secured planned budget provisions and which are subject to allocation from the budget of the city of Minsk for 2004 (point 5).
Point 10 of Decision of Minsk city executive committee shall contain instructions with respect to organizations-customers of housing and communal, as well as non-productive sphere while carrying out capital and current repair at the expense of budgetary provisions to apply by concluding (renewal) contracts with organizations of any form of ownership the relevant reducing coefficients as to planned accumulations and burden costs (except for the repair works of slate and stale roofs): capital repairs - 0,8, current repairs - 0,5.
Legal position of the Constitutional Court concerning the issue of the constitutionality of setting by the executive committees of reducing coefficients as to planned accumulations and burden costs has been stated in Decision of the Constitutional Court of 1 July 2004 "On constitutionality of sub-item 1.3 of point 1 of Decision of Vilejka region executive committee of 27 February 2003 No. 84 "On additional measures on economy of budgetary funds in 2003". The Constitutional Court has approved the right of the executive committee to disposes of municipal property of an administrative and territorial unit consisting of treasury of an administrative and territorial unit, as well as the property assigned to the communal legal entities in accordance with the procedure specified by the council of deputies. In the opinion of the Constitutional Court, Decision of the executive committee as regards setting of reducing coefficients is directed to economizing of budgetary resources, and that shall have positive social results for the region, since reducing of expenditure shall make it possible to increase the volume of building works, to carry out reconstruction and heavy repair of a big number of objects of infrastructure of the region: schools, hospitals, palaces of culture, sport constructions. At the same time, the Constitutional Court has emphasized that in accordance with the decision of Vilejka region executive committee the reducing coefficients shall be applied to the new contracts only which were concluded after the adoption of the given decision and after its entering into legal force. Therefore, the Constitutional Court has found decision as regards setting of reducing coefficients to be in line with the Constitution and the acts of legislation of the Republic of Belarus.
According to point 25 of Decision of Minsk city executive committee of 4 March 2004 No. 453 it shall come into legal force since 1 January 2004, i.e. the specified enforceable enactment is given retrospective action. Decision has been included into the National register of legal acts of the Republic of Belarus of 1 January 2004 No. 9/3294.
Study of law applying practice has indicated that within the period from 1 January 2004 till adoption of decision and its inclusion into the National Register of legal acts of the Republic of Belarus the organizations-customers of housing and communal, as well as non-productive sphere there were concluded (renewed) contracts with organizations for carrying out capital and current repair at the expense of budgetary provisions without taking into account reducing coefficients as to planned accumulations and burden costs. Certain contract were terminated due to performance of the duties by both parties, other treaties - executed by the contractors but were not paid by the customer, there have been also the partially performed by the contractors. After the adoption of Decision of Minsk city executive committee of 4 March 2004 No. 453 the contractors were proposed to make recalculation of the cost of works carried out since 1 January 2004 the reducing coefficients taking account.
Under part six of Article 104 of the Constitution the law shall have no retrospective action unless it extenuates or revokes the responsibility of citizens. Article 67 of the Law "On enforceable legal acts of the Republic of Belarus" shall envisage that an enforceable enactment shall have no retroactivity, i.e. if it does not cover the relations arising before its enforcement, except for the instances when it mitigates or revokes the responsibility of citizens and by some other way improve the status of persons who are under the effect of an enforceable enactment, or if the enforceable enactment or the act of its enforcement directly specifies that its effect shall cover the relations appeared before its enforcement.
At the same time, the Constitutional Court deems that the rule of giving retroactivity the enforceable enactment shall mean inadmissibility to give retroactivity the enforceable enactment not only while solving the issue on imposition of legal liability, but also in case of such an alteration of the legislation as a result of which the status of citizens or legal entities is aggravating. The Constitutional Court emphasizes that in instances when the enforceable enactment itself or the act of its enforcement specifies directly that it shall cover its force over the law relations arising before its enforcement, retroactivity may be given only those norms of the enactment in question which do not aggravate the position of citizens or legal entities. The Constitutional Court in a number of its decisions (judgments) has paid attention to the necessity of observance of the constitutional principle of giving the enactments the retrospective action.
Moreover, the Constitutional Court underlines that giving retroactivity the norms containing in point 10 of Decision of Minsk city executive committee of 4 March 2004 No. 453 may be at variance with the principles of supremacy of the law and equality of the rights of participants of civil relations specified in Article 2 of the Civil Code of the Republic of Belarus.
The Constitutional Court pointed out the necessity of observance of the constitutional principle of the freedom of contract (part four of Article 13 of the Constitution; paragraph seven of part two of Article 2, Article 391 of the Civil Code), and due to which Decision of Minsk city executive committee of 4 March 2004 No. 453 shall be the ground for the negotiations of organizations-customers with contractors about alteration of conditions of the contract or, in case of failure to reach an agreement, - about its termination. Exclusion, in the opinion of the Constitutional Court, taking into account the provisions of part two of point 3 of Article 276 of the Civil Code, may be only the instances when the customer and contractor under the contract are the unitary communal enterprises.
Guiding by part one of Article 116, part four of Article 122 of the Constitution Articles 7, 36, 38, 40, 401 of the Law "On the Constitutional Court of the Republic of Belarus", the Constitutional Court
RULED:
1.To find that application of point 10 of Decision of Minsk city executive committee of 4 March 2004 No. 453 "On results of execution of the budget of the city of Minsk and on situation of control and economic work for 2003, tasks on execution of Decision of Minsk city council of deputies of 30 December 2003 No. 72 and economy of budgetary funds in 2004" which sets reducing coefficients should be carried out taking into account the requirements of Article 104 of the Constitution of the Republic of Belarus and Article 67 of the Law "On enforceable legal acts of the Republic of Belarus" which do not allow aggravation of legal position of participants of public relations, as well as the norms of the Civil Code of the Republic of Belarus which enshrine the principle of freedom of contract.
2. The present decision shall come into legal force from the date of adoption.
3. To publish the present Decision in accordance with the legislation.
Presiding Officer —
Chairman of the
of the