Court Precedent – the Estonian Approach

Presentation at the conference "Court Precedent – the Baltic Experience" Vilnius, 15 September 2016 Introduction In my short presentation I will try to give you an overview of the nature and role of the court precedent in the Estonian legal order. It must be asked, as a preliminary point, what do we actually have in mind when talking about court precedent (or judge-made law) in the context Continental European legal system? In 1998, an act was passed in Estonia by which the decisions of the Supreme Court were deemed to be a source of criminal procedural law. Also according to the current Code of Criminal Procedure (Section 2 subsection 4) the sources of criminal procedural law are decisions made by the Supreme Court in issues that are not regulated by other sources of criminal procedural law but which arise in the application of law. It must be noted that in other areas of the law the Estonian legislator has not recognised the decisions of the Supreme Court explicitly as a source of law. Let it also be mentioned that aspects of EU and international law (primarily ECHR practice), which in reality have an impact on the activities of national courts in the interpretation and development of the law, will not be considered in the following presentation. Court precedent – inevitable and necessary The constitutional principle of a state based on the rule of law involves legal certainty, among other things. According to Supreme Court practice, legal certainty in the most general sense, means that the law serves the purpose of creating order and stability in the society.1 In the continental legal system, it is known that laws are of crucial importance in ensuring legal certainty. At the same time it is not excluded that the laws always do not give a clear answer to a legal question, are ambiguous in content, or there is a gap in the law. It has been repeatedly emphasised, in the Estonian legal literature, that the coherence of the administration of justice achieved in connection with court decisions made by the courts (especially the higher courts) has an extremely important role in ensuring legal certainty.2 Even though a judge-made legal rule is not usually mandatorily binding, it may be a guideline for resolving similar legal questions, and essentially obtains the status of a precedent.3 In the narrower meaning, a precedent is legally mandatory with respect to later analogous cases, which clearly come under a principle that has already once been decided. Therefore, in Continental Europe, it is more correct to talk about a precedent in the context of a wider meaning: that is the right of the courts to interpret the law created by the legislator in their decisions. In the legal literature, such decisions are sometimes also called “value decisions” and the higher the court that made the decision, the more valuable decision it is.

1 RKPJKo 30.09.1994, III-4/1-5/94; 23.03.1998, 3-4-1-2-98, p. IX. 2 M. Sillaots. Kohtunikuõiguse võimalikkusest ja vajalikkusest kontinentaal-euroopalikus õiguskorras. Tartu, 1997, p. 86. 3 See e.g. M. Sillaots. Kohtunikuõigus. – Juridica 1998/5, p 238-241; A. Kiris jt. Õiguse alused. Tallinn: TTÜ kirjastus 2003, p. 68. For Estonia, the above situation is the case, where the decisions of the Supreme Court are mainly considered. In simplified terms, the legal reality is that the decisions of the Supreme Court are relied on as a subsidiary source of law in all branches of law, and not just in criminal procedural law (in the situation of a gap in the law). The practical need for such case law, in a wider meaning, is caused by the modern legal reality. Legal relations are becoming increasingly more complicated, and the number of legal norms is also increasing. In such a situation, authoritative positions which harmonise the legal practice are helpful to the judge, as well as to the parties in a dispute. And a convincingly- reasoned precedent decision helps to highlight the legal principles and the constitutional values in addition to resolving a specific legal dispute. The same quality may also be attributed to a precedent case, which means e.g. that some legal norm is applied for the first time, together with the necessary justifications and explanations (e.g. the first court decision concerning a offence relating to competition).

Meaning of a Supreme Court decision by law Next, I will briefly touch upon the meaning of a Supreme Court decision by law. Following the legal traditions of Continental Europe according to law, the positions expressed in a decision by the Supreme Court, as well as the district court, in the interpretation and application of a legal norm are expressis verbis mandatory only for the court that hears the same case again. The exceptions are those decisions concerning criminal procedural law in cases of a gap in the law, which have already been referred to. It may be claimed that for the Supreme Court, as a court of cassation, the task of assisting in the uniform application of legal norms is of central importance. The norms of the Estonian procedural codes help to ensure the performance of this task. These norms regulate the acceptance of appeals in cases of cassation, referrals of the matter to the full Chamber, Special Panel and the Supreme Court en banc, and the mandatory nature of the positions of the Supreme Court. The procedural codes prescribe that the Supreme Court shall accept a cassation, among other things, if the resolution of the appeal in the cassation is important from the position of a uniform application of the legal act or the development of the law. Ensuring the uniform application of the law is also an independent argument when it refers to the adjudication of a matter to the Supreme Court en banc (that is to all 19 justices of the Supreme Court). The consistency of the positions of the Supreme Court is ensured, among other things, by the limitation that restricts the changing of current practices too easily: the position expressed in the earlier practice of the Chamber can generally only be reviewed in the context of a larger composition (however for example in civil proceedings it is the right of the Chamber, but not an obligation).

Meaning of the Supreme Court decision in judicial practice I will start by discussing the case law decisions related to criminal procedural law, the binding nature of which the legislator in Estonia has recognised expressis verbis as a source of law. Our dear colleague Eerik Kergandberg has stated in a Commentary of the Code of Criminal Proceedings (2012) that, in the current case-law of the Supreme Court, the provision of court precedent (CCP Section 2 subsection 4) has been referred to relatively rarely. This may lead us to conclude that:

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1) the Supreme Court has used the respective competence (has had to use it) only in single cases (e.g. extending the standing, and restricting the right of cassation of the prosecutor’s office upon an acquittal in an expired criminal offence; restricting the standing of the injured party if the prosecutor’s office withdraws the charges; extending the competence of the enforcement judge in the application of the mitigating retroactive effect of a penal law); or 2) there is no specific reference to this legal norm in relevant Supreme Court decisions. One example comes from May of this year. The Criminal Chamber made a decision by using the precedent provision in a case, where the main question was whether sending materials from a criminal case to the juvenile committee simultaneously with the termination of the criminal proceedings could be considered as merely a ruling for the termination of the criminal proceedings by nature. This determines whether, and according to which procedure, this ruling could be challenged. If the commission of the offence by the minor was not confirmed, then sending at the termination of criminal proceedings the materials of the criminal case to the juvenile committee, would intensely infringe the interests of the minor. The committee might apply sanctions in respect of the minor, due to which it would not be the so-called “rehabilitating termination” of the criminal proceedings. The Supreme Court gave instructions that upon resolving the issue of the appeal in such a situation, the investigation complaint proceedings regulation must be relied on. 4 It has been explained, in the Criminal Chamber 2006 decision (3-1-1-68-06), that the competence to create new law given to the Supreme Court is (I quote) “of a clearly subsidiary nature and is based on the unavoidable need to move forward in procedural situations arising in criminal proceedings, where it is such a genuine legal gap, which cannot be filled by a legal analogy.” In interpreting the legislative activity of the court in accordance with the constitution, the creation of the additional violation of fundamental rights in a case law was precluded. The above position was stated in a case where a transfer from general proceedings to simplified proceedings was deemed to be a fundamental breach of procedural law, as in the simplified proceedings the procedural guarantees are always applied to a more restricted degree than in the general proceedings. So far, the question of the constitutionality of the criminal procedural case law of the Supreme Court has not arisen in judicial practice or in theory. However, it is important to identify, when initiating supervision over the constitutionality and delimiting the use of the precedent competence, whether: 1) the situation that needs resolving is legally unregulated and the methods of the interpretation of law are insufficient for bridging the gap; or 2) using some procedural right is precluded due to an unconstitutional factor.

For example, the Code of Criminal Procedure lists court rulings which cannot be challenged. In 2012, the Supreme Court deemed unconstitutional a restriction of the appeal, in the case of rulings by which the unserved sentence of a conditionally-released offender was enforced due to a violation of the terms of probation. Thereafter, in one case the County Court extended the right of appeal, by which community service was implemented instead of custody, which was deemed unsuccessful and custody was enforced. Ultimately, the Supreme Court had to admit

4 RKKKm 27.05.2016, 3-1-1-39-16

3 that, as in the disputed case the appeal-procedure was precluded expressis verbis by law, it was not a gap in the law but the assessment of the constitutionality was deemed necessary.5 The meaning of obiter dictum statements and whether they can have any binding meaning has also been discussed. It was noted, in a competing opinion to one 2015 Criminal Chamber decision (3-1-1-62-14), that this was a special case of changing the Supreme Court practice in the sense that the earlier position was specified in questions which had then only been written down for the purpose of “directing legal practice” by way of obiter dictum.6 Referring the matter to the full composition of the Chamber is said to be a sign of the fact that obiter dictum is important and is essentially also a precedent. At the same time, it was emphasised that the matters said by the Supreme Court obiter dictum cannot be a source of criminal procedural law for the purposes of Section 2 Subsection 4 of the CCP, because the need to say something obiter dictum arises outside the specific item in the proceedings. Essentially however, this does not preclude that a similar position cannot be taken in some procedural law issue – now already as part of an item of the proceedings – as was previously taken obiter dictum. What, however, is the broader meaning of the Supreme Court decisions in Estonian judicial practice? It is appropriate to respond to this question by quoting the year 2008 decision of the Criminal Chamber of the Supreme Court.7 Namely, the Chamber agreed with the appellant in a cassation that in matters of substantive law, the legislator has not expressis verbis attributed court precedent meaning to Supreme Court decisions. At the same time, the Chamber drew attention to the fact that the higher courts of countries with a predominantly so-called continental legal system have the obligation to ensure the uniform application of law (including substantive law). A Supreme Court decision does not create an immediately applicable norm in issues of the application of substantive law, which bind other entities in implementing the law. However, likelihood that the same decision will also be made by the Supreme Court in similar cases in the future gives the Supreme Court decision a so-called “factual bindingness”. The Supreme Court emphasised that it cannot be deemed acceptable when in analogous criminal cases the positions taken in earlier judicial practice are disregarded (and that such an activity weakens the authority of the administration of justice, damages legal certainty and creates conditions for the unfair treatment). The importance of relying on Supreme Court decisions has also been highlighted by the Administrative Chamber which noted, when referring to the Code of Administrative Court Procedure, that in addition to the mandatory nature of the positions of Supreme Court decisions, as part of the same matter, they also have an important role in forming unified judicial practice and developing the law.8 There is no analogy of the Section 2 Subsection 4 of the CCP in civil proceedings; therefore, we cannot talk about an entirely genuine court precedent with regard to civil matters. However, decisions where the analogy or the principle of good faith established in the Law of Obligations Act have been applied are close to it. According to Section 6 subsection 2 of the Law of Obligations, “nothing arising from law, a usage or a transaction shall be applied to an obligation if it is contrary to the principle of good faith”. For example, the Supreme Court implemented the principle of good faith in a matter where the respondent acted in a contradictory manner, by accepting payments made pursuant to a

5 RKKKm 18.02.2013, 3-1-1-5-13. 6 Competing opinion to RKKKo 23.02.2015, 3-1-1-62-14. 7 RKKKo 01.04.2008, 3-1-1-101-07, Para 14. 8 RKHKo 24.11.2010, 3-3-1-71-10, Para 14.

4 void transaction over a long period of time, and at the same time giving the plaintiff the impression that he would ensure the conclusion of a notarised sale and real right contract. The Civil Chamber noted (I quote): “The respondent’s behaviour and pursuant to that, also relying on the limitation period objection, may be in conflict with the principle of good faith if the plaintiff has made payments to the respondent over a longer period of time, and the respondent has accepted them and has thereat repeatedly promised that it will enable the plaintiff an apartment ownership, due to which the plaintiff, in reliance on the constant promises, has delayed with the recovery of the money for so long that the right of recourse of the payments made by him or her has finally expired”.9 According to the function of the Supreme Court and with the support of the law, the main creator of the precedent in Estonia in the wider sense is the Supreme Court. However, a convincingly reasoned decision of a lower instance court, which says something new about the law, may also find recognition as a court precedent. For example, the Supreme Court can agree with the solution offered by a county court or a district court, and also cite or use parts of the decision of the lower instance court in another court case as a response to the appellant’s arguments (e.g. 3-1-1-14-14, when explaining the duty to give reasons for granting permission for surveillance activities). At the same time, there is a generally recognised principle in Estonia that, when justified, a court of lower instance can take a different position to the interpretation provided by the Supreme Court. This freedom of the judge is also confirmed by the practices of the Disciplinary Chamber10. On two occasions, a judge has been accused of a failure to follow the clear and developed practices of the Supreme Court and has been released from disciplinary charges. In the latest case, the Disciplinary Chamber emphasised that, in order to ensure the independence of a judge, disciplinary sanction must be precluded in cases where a judge interpreted the law according to their conscience and not according to anyone else’s understanding. In addition the Disciplinary Chamber found that, this was not a clearly worded and unambiguous legal norm, because if the relevant norms were interpreted, a different conclusion may be reached than was developed in the practice of the Administrative Law Chamber of the Supreme Court when determining the administrative act and legislative act. The Disciplinary Chamber concluded that the judge had interpreted the legal norm according to his conscience, and the fact that the judge did not refer to the relevant decisions of the Supreme Court, in which a contrary position to his or her position was delivered, was not a disciplinary offence by the judge. The other aspect is that, upon reaching a different conclusion than developed in a Supreme Court decision, a dispute is often reduced to the matter of whether the same factual situation exists in the case that was the basis for making the Supreme Court decision and in the pending legal dispute, or there is a difference in circumstances that determines a different legal resolution. In their appeals, the parties also sometimes rely on the fact that the relevant decision of the Supreme Court is not applicable in a specific case, due to the difference in circumstances. In favour and against the regularisation of bindingness The need to regulate court precedents was discussed actively in Estonia in the 1990s. In the legal literature, the wording of a provision confirming the bindingness of Supreme Court decisions was offered, and the potential limits of judge-made law in the Estonian legal order

9 RKTKo 17.02.2016, 3-2-1-169-15. 10 See e.g. http://dspace.ut.ee/bitstream/handle/10062/51740/otto_laura.pdf?sequence=1&isAllowed=y, p. 49.

5 were also described.11 However, a more conservative direction found that, considering the differences of the legal systems, it was impossible to change the legal culture merely by passing an Act where the principle of the bindingness of court decisions would be included, and that one provision which prescribes the binding nature of court decisions did not yet make it a precedent in the substantive meaning of the word. As the main counterargument it was noted that, considering the legal culture of continental Europe, operating in this way would be a direct barrier to the development of legislation.12 As I mentioned at the beginning of this presentation, the Supreme Court criminal procedural law precedents are the only ones the Estonian legislator has recognised as a source of law. This can be justified, among other things, by the economy of procedure argument: the implementation of a substantive law cannot be hindered by procedural restrictions, and the cumbersome nature of the regular legislative process does not ensure a solution in a situation where it is necessary to quickly reach a decision. On the other hand, the Supreme Court has used this competence rather modestly and has established limitations for the use of judge- made laws with regard to the infringement of fundamental rights. The question of whether the Supreme Court should have the same competence as it has in criminal procedure in other court proceedings needs further discussion. Summary It may be said, in summary, that there have been no very passionate arguments about the right to the existence of the judicial precedent in the Estonian legal order. The aim of ensuring a uniform judicial practice creates a practical need for court precedent in the wider sense. Supreme Court case-law plays a crucial role in this matter. Regardless of the fact that the court precedent is not formally binding in the Estonian legal order, the courts often refer to Supreme Court decisions. Parties also often follow and take into account Supreme Court practice. Furthermore, court precedent in not only a source of law for the Criminal Procedure but has factual binding nature in all areas of law. In Estonia, the question is not whether and how court precedent should be made binding by law. Instead, the issue is that Estonian information systems are being developed and exceedingly better technical solutions should be sought, which would help in finding the relevant Supreme Court positions faster and more easily when adjudicating on a specific legal issue.

11 M. Sillaots. Kohtunikuõiguse võimalikkusest ja vajalikkusest kontinentaal-euroopalikus õiguskorras. Tartu: Riigikohus 1997, pp. 104-105. 12 R. Narits. Kohtupretsedendist. - Juridica 1995/9, pp. 380-382.

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