The Resolution No 3 (Resolution) of the Constitutional Court (CC) interpreted the Constitution of the Republic of Bulgaria on the effect of the resolutions of the CC, which declares unconstitutionality of an act, in regard to existing legal relations and pending court proceedings. This Resolution is of significant importance to the producers of energy from renewable sources in connection with state fees for electricity production, collected by the State in the period 01.01.2014 – 09.08.2014.
The case
The newly created §6, items 2 and 3 of the final provisions of the State Budget Act were published in the State Gazette, No. 109 of 2013 as creating Art. 35a, para. 1, 2 and 3, Art. 35b, para. 1, 2, 3 and 4 and Article 35c, para. 1, 2 and 3 of the Renewable Energy Act. These provisions introduced a fee for production of electricity from wind and solar plants in the amount of 20%. These provisions have been declared unconstitutional by Judgement № 13 of 31.07.2014 of the Constitutional Court. However, the fees collected during the period of validity of the unconstitutional act were not reimbursed, which led to many claims against the Republic of Bulgaria for damages resulting from the adoption of an unconstitutional act and failure to reimburse the amounts after its adoption.
Therefore , the necessity of interpretation of Article 151, para. 2, third sentence of the Constitution of the Republic of Bulgaria, on the basis of which the C should answer the following question:
“What is the effect of the decision of the Constitutional Court, which declares unconstitutionality of an act, in regard to existing legal relations and pending court proceedings, in view of the provision of Article 151, para. 2, third sentence of the Constitution of the Republic of Bulgaria?”
The judgement
The CC resolved that up to declaration of unconstitutionality of an act, it is presumed that this act is legal and valid. The non-application of the unconstitutional act only in the future protects the legal stability and the trust of the addressees of the acts.
The effect of the resolutions of the CC cannot be extended to the legal relations already settled by the act declared unconstitutional. It does not directly affect these legal relations. Such resolutions, however create an obligation for the legislator to settle the consequences of the application of the unconstitutional acts. Until the ruling of the National Assembly on damages relief, in the presence of a legal dispute, the courts shall resolve it by directly applying the Constitution and the principles of law. The latter is also applicable to the acts with one-time effect, which has already been implemented before the enforcement of the decision of the Constitutional Court.
Notwithstanding the above, under the constitutional compliance control, the purpose of constitutional justice is to guarantee the supremacy of the Constitution. This can be fully achieved if the legal consequences of the application of an unconstitutional act, applied until the enforcement of the CC resolution in this respect, are settled by the authority that passed the act and in accordance with the motives of the CC resolution. In order to enact the meaning and to achieve the purpose of the constitutional compliance control – to guarantee the supremacy of the Constitution – the CC resolution in relation to the legal relations already settled by the an unconstitutional act, in view of the provision of Article 151, para. 2, third sentence of the Constitution of the Republic of Bulgaria, obliges the National Assembly to settle the legal consequences arising out of the implementation of the unconstitutional act.
The Constitution itself contains a mechanism to achieve the necessary balance between the precepts of legal certainty and legal equity as components of the rich, multifaceted content of the rule of law. This derives from the provision in Article 22, para. 4 of the Constitutional Court Act. It is also associated with Article 7 of the Constitution, providing for liability of the state for damages caused by illegal acts or actions of its authority and officials, which inevitably covers the liability of the authority that issued the unconstitutional act. The settlement of the legal consequences from the application of the act until its declared unconstitutional is not within the competence of the CC, but its decision obliges the authority that passed the act to fulfill its constitutional obligation. The latter represents it’s the meaning of the CC control as an element of the overall constitutional mechanism for balancing of the authorities. Тhe actions that the authority should take in order to settle the legal consequences from the application of the act until the enforcement of the decision of the CC are an immanent part of the process of ensuring the supremacy of the Constitution.
In conclusion, according to the rule of Article 151, para. 2, third sentence of the Constitution, the CC resolution declaring an act unconstitutional is valid for the future. The unconstitutional law does not apply to on-going legal relations as at the moment of the enforcement of CC resolution. The National Assembly settles the legal consequences of the application of the unconstitutional act.
