Important Changes in Civil Litigation – Part III – Review and Reasoning

As a general rule, civil proceedings in Hungary are two-tiered, meaning that it is possible to appeal against a judgment handed down at first instance. There is no further appeal against the judgment of the court of the second instance.

Hungarian procedural law recognises the institution of review. A review is an exceptional option, which is carried out by the Supreme Court. We distinguish between reviews that require authorisation and those that are “automatic”. A review may be requested because a violation of the law occurred in the first or second instance proceedings that affected the merits of the case, or because the decision in question deviates from a decision published by the Supreme Court (which serves as quasi-precedent). In certain cases, some decisions are excluded from review (e.g., in the case of a judgment that has become final in the first instance or against a judgment handed down by the Supreme Court). There is also no place for review if the disputed value does not exceed five million forints, but in this case, the review may be authorised.

The Act significantly modifies the rules of review, following many European (e.g. German, Czech, Finnish) models. Based on this, the review will require authorisation in all cases, with a few exceptions. According to the explanatory memorandum to the Act, the rationale behind the change is that in many cases, with a low value but which are important in terms of legal issues, do not reach the Supreme Court, which means that the Supreme Court cannot fulfil its role of ensuring legal uniformity with sufficient effectiveness. The most important exception to the requirement for authorisation is when the judgment of the court of first instance is changed by the court of second instance.

Another significant change is that, in order to optimise the administrative burden and thus the work of judges, judgments containing abbreviated reasoning will be issued. Under the current rules, judgments are pronounced orally most of the time, but are then sent to the parties in writing afterwards. It was common practice for legal representatives not to attend the oral pronouncement of the judgment, so that the appeal period would only start from the date of delivery. Under the new rules, if the parties do not appear at the pronouncement of the judgment or if they do not request a detailed statement of reasons after the oral hearing, only an abbreviated reasoning will be issued. The parties, then, if they want, must notify the court of their intention to appeal and pay the levy within five working days of receiving the judgment containing the abbreviated statement of reasons. The court will then prepare the detailed reasoning for the judgment and call on the appealing party to submit their appeal within 15 days.

Experts point out that, in certain cases, it may be problematic that the party must declare its intention to appeal without knowing the detailed judgment and must even pay the fee at that point, which may lead to uncertainty.