2013-04-03
Contributions due for benefits cannot be assessed within an indefinite
period of time after the benefit has been received. Instead, the
legislature must achieve a balance between the public interest in the
levying of the contribution and the interest of the person liable to pay
the contribution in obtaining clarity about the extent of the payment.
This is what the First Senate of the Federal Constitutional Court
decided in an order that was published today. At the same time, the
Senate declared a provision of the Bavarian Municipal Charges Act
(Bayerisches Kommunalabgabengesetz) incompatible with the constitutional
principle of legal certainty because the provision does not consider at
all that the person liable to pay the contribution has an interest in a
time limit for the levying of charges. The Land legislature was
requested to enact a constitutional provision by 1 April 2014.
Essentially, the decision is based on the following considerations:
1. According to Bavarian law, the time-limit for the assessment of
municipal contributions is four years. As a general rule, the time-limit
starts to run at the end of the year in which the duty to pay the
contribution has arisen. In this regard, the Bavarian Municipal Charges
Act makes reference to the Federal Fiscal Code. Article 13 sec. 1 no. 4
letter b double letter cc indent 2 of the Bavarian Municipal Charges
Act, however, makes special provision for the case of invalidity of the
rules on contribution: in this case, the time-limit starts to run only
at the end of the calendar year in which valid rules have been
published.
2. From 1992 to 1996, the complainant was the owner of built-up property
which was connected to the local drainage system. During an inspection
of the property in 1992, the local authorities found out that the top
floor of the building had been converted. However, they levied a
drainage construction contribution for the converted surface of the top
floor from the complainant only in a subsequent assessment order of 5
April 2004. The order was based on Rules Governing Contributions and
Fees which supplemented the Drainage Rules of 5 May 2000. To remedy the
voidness of the previous Rules, the local authorities had enacted the
Rules with retroactive effect as from 1 April 1995. During the
complainant’s objection proceedings, these Rules proved void as well.
The local authorities thereupon adopted new Rules and put them into
force retroactively as from 1 April 1995. The new Rules were published
in the Municipal Gazette on 26 April 2005.
3. The action brought by the complainant against the assessment order
and against the ruling by the local authorities on the complainant’s
objection was unsuccessful before the Administrative Court and the
Higher Administrative Court.
4. The constitutional complaint lodged against these decisions is
admissible and well-founded to the extent that it challenges a violation
of the constitutional principle of legal certainty.
a) If no independent new violation of the right to a hearing in court
committed by the court of appeals is alleged, a complaint that alleges a
violation of this right does not need to challenge also the ruling of
the court of appeals to satisfy the requirement that all legal remedies
must have been exhausted before a constitutional complaint is lodged.
b) In the case at hand, the constitutional standards for the
permissibility of retroactive laws are not violated. As far as the
complainant is concerned, Art. 13 sec. 1 no. 4 letter b double letter cc
indent 2 of the Bavarian Municipal Charges Act does not have retroactive
effect. The Act entered into force on 1 January 1993. At that time, no
Rules existed that effectively remedied the voidness of the existing
Rules within the meaning of the provision. Such Rules with effect as
from, or before, 1 January 1993 did not enter into force at a later date
either. Irrespective of the new legislation, the period of limitation
had therefore not begun to run.
c) However, the provision in question violates Art. 2 sec. 1 of the
Basic Law (Grundgesetz – GG) in conjunction with the principle of legal
certainty, which is an essential component of the principle of the rule
of law entrenched in Art. 20 sec. 3 GG, in its manifestation as
principle of clarity and predictability of burdens.
aa) In their interaction with the fundamental rights, legal certainty
and the protection of confidence guarantee the reliability of the legal
order, which is an essential prerequisite for self-determination over
one’s own life choices and their implementation. The principle of the
protection of confidence means that the citizens must be able to rely to
a certain extent on the continuance of certain statutes. Furthermore,
under specific circumstances, the principle of the rule of law
guarantees legal certainty even if no statutes exist that give rise to
specific confidence, or if circumstances exist that are even contrary to
such confidence. In its manifestation as principle of the clarity and
predictability of burdens, the principle of the rule of law protects
against using events that occurred a long time ago and are de facto
completed as a link for imposing new burdens.
bb) If obligations to pay contributions in return for benefits link to
facts in the past, it is required under constitutional law to establish
a time-limit for the obligation to pay.
The aim of limiting payment claims of state authorities is to achieve a
fair balance between the justified interest of the public in the
comprehensive and complete realisation of these claims on the one hand,
and the citizens’ interest, which is worthy of protection, on the other
hand, in no longer having to expect at some point in time to be liable
to make a contribution, and in being able to plan accordingly. It is a
characteristic of statutes of limitation that they apply without
evidence that confidence existed in an individual case, without
confidence that is typically assumed, and in particular without
confidence being actively exercised. Instead, they derive their
justification and their necessity from the principle of legal certainty.
When levying contributions in return for benefits, the legislature is
obliged to enact statutes of limitation, or at least to ultimately
ensure that such contributions cannot be assessed for an unlimited time
after the benefit has been received. Contributions derive their
legitimation from compensating a benefit that the persons concerned
received at a certain point in time. The longer ago this point in time
was at the time when the contributions are assessed, the more does the
legitimation to assess such contributions decrease. The principle of
legal certainty demands that the recipient of a benefit obtains clarity
in reasonable time about whether, and if so, to what extent,
contributions must be paid in return for the benefits received.
cc) In Art. 13 sec. 1 no. 4 letter b double letter cc indent 2 of the
Bavarian Municipal Charges Act, the legislature failed to achieve the
necessary balance between legal certainty on the one hand and the
validity of the law and the fiscal interest, on the other hand. By
postponing the beginning of the period of limitation without setting any
time limit, the legislature does not at all take into account the
citizen’s justified interest in not having to expect the assessment of
the contribution if a certain time has passed after the benefit arose.
5. As the legislature has several possibilities of remedying the
unconstitutional situation at its disposal, in the case at hand it is
only possible to declare the provision in question incompatible with the
Constitution. This has the consequence that the unconstitutional
provision may no longer be applied by courts and administrative
authorities. Pending court and administrative proceedings in which the
decision depends on this provision remain suspended or are to be
suspended until a new legislation is enacted, at the latest, however,
until 1 April 2014. If the legislature has not enacted a new legislation
until 1 April 2014, the unconstitutional provision will be void.
(Press release of the Federal Constitutional Court no. 19/2013 of April, 3rd 2013)
