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Ministers'
Deputies Strasbourg,
30 May – 1 June 2001 PART A: Draft Recommendation Rec(2001)XX on Alternatives to Litigation between administrative authorities and private parties
Part
B: Explanatory Memorandum
PART A
DRAFT RECOMMENDATION Rec(2001) XX ON ALTERNATIVES TO LITIGATION BETWEEN ADMINISTRATIVE AUTHORITIES AND PRIVATE PARTIES
1. The Committee of Ministers, under the terms of Article 15.b of the Statute of the Council of Europe, 2. Considering that the aim of the Council of Europe is to achieve a greater unity between its members; 3. Recalling Recommendation No R (81) 7 on measures facilitating access to justice, which in its appendix called for measures to encourage the use of conciliation and mediation; 4. Recalling Recommendation No R (86) 12 concerning measures to prevent and reduce the excessive workload in the courts, which calls for encouraging, in appropriate cases, the use of friendly settlement of disputes, either outside the judicial system altogether or before or during legal proceedings; 5. Considering, on the one hand, that the large amount of cases and, in certain states, its constant increase can impair the ability of courts competent for administrative cases to hear cases in a reasonable time, within the meaning of Article 6.1 of the European Convention on Human Rights; 6. Considering, on the other hand, that the courts' procedures in practice may not always be the most appropriate to resolve administrative disputes; 7. Considering that the widespread use of alternative means of resolving administrative disputes can allow these problems to be dealt with and can bring administrative authorities closer to the public; 8. Considering that the principal advantages of alternative means of resolving administrative disputes may be, depending on the case, simpler and more flexible procedures, allowing for a speedier and less expensive resolution, friendly settlement, expert dispute resolution, resolving of disputes according to equitable principles and not just according to strict legal rules, and greater discretion; 9. Considering, therefore, that in appropriate cases it should be possible to resolve administrative disputes by means other than the use of courts; 10. Considering that the use of alternative means should not serve administrative authorities or private parties as a means of avoiding their obligations or the rule of law; 11. Considering that, in all cases, alternative means should allow judicial review, as this constitutes the ultimate guarantee for protecting both users' rights and the rights of the administration;
12. Considering that alternative means to litigation must respect the principles of equality and impartiality and the rights of the parties;
13. Recommends that the governments of member states promote the use of alternative means for resolving disputes between administrative authorities and private parties by following, in their legislation and their practice, the principles of good practice contained in the appendix to this recommendation.
Appendix to Recommendation No. R (XX) XX
I. General provisions
1. Subject of the recommendation
i. This recommendation deals with alternative means for resolving disputes between administrative authorities and private parties.
ii. This recommendation deals with the following alternative means : internal reviews, conciliation, mediation, negotiated settlement and arbitration.
iii. Although the recommendation deals with resolving disputes between administrative authorities and private parties, some alternative means may also serve to prevent disputes before they arise; this is particularly the case in respect of conciliation, mediation and negotiated settlement.
2. Scope of alternative means;
i. Alternative means to litigation should be either generally permitted or permitted in certain types of cases deemed appropriate, in particular those concerning individual administrative acts, contracts, civil liability, and generally speaking, claims relating to a sum of money.
ii. The appropriateness of alternative means will vary according to the dispute in question.
3. Regulating alternative means:
i. The regulation of alternative means should provide either for their institutionalisation or their use on a case-by-case basis, according to the decision of the parties involved.
ii. The regulation of alternative means should:
a. ensure that parties receive appropriate information about the possible use of alternative means;
b. ensure the independence and impartiality of conciliators, mediators and arbitrators;
c. guarantee
fair proceedings allowing in particular for the respect of the rights of the
parties and the principle of equality;
d. guarantee, as far as possible, transparency in the use of alternative means and a certain level of discretion;
e. ensure the execution of the solutions reached using alternative means.
iii. The regulation should promote the conclusion of alternative procedures within a reasonable time by setting time-limits or otherwise.
iv. The regulation may provide that the use of some alternative means to litigation will in certain cases result in the suspension of the execution of an act, either automatically or following a decision by the competent authority.
II. Relationship with courts
i. Some alternative means, such as internal reviews, conciliation, mediation and the search for a negotiated settlement, may be used prior to legal proceedings. The use of these means could be made compulsory as a prerequisite to the commencement of legal proceedings.
ii. Some alternative means, such as conciliation, mediation and negotiated settlement, may be used during legal proceedings, possibly following a recommendation by the judge.
iii. The use of arbitration should, in principle, exclude legal proceedings.
iv. In all cases, the use of alternative means should allow for appropriate judicial review which constitutes the ultimate guarantee for protecting both users' rights and the rights of the administration.
v. Judicial review will depend upon the alternative means chosen. Depending on the case, the types and extent of this review will cover the procedure, in particular the respect for the principles stated under section I.3.ii.a, b, c, and d, and/or the merits.
vi. In principle and subject to the law, the use of alternative means should result in the suspension or interruption of the time-limits for legal proceedings.
III. Special features of each alternative means
1. Internal reviews
i. In principle, internal reviews should be possible in relation to any act. They may concern the expediency and/or legality of an administrative act.
ii. Internal reviews may, in some cases, be compulsory, as a prerequisite to legal proceedings.
iii. Internal reviews should be examined and decided upon by the competent authorities.
2. Conciliation and mediation
i. Conciliation and mediation can be initiated by the parties concerned, by a judge or be made compulsory by law.
ii. Conciliators and mediators should arrange meetings with each party individually or simultaneously in order to reach a solution.
iii. Conciliators and mediators can invite an administrative authority to repeal, withdraw or modify an act on grounds of expediency or legality.
3. Negotiated Settlement
i. Unless otherwise provided by law, administrative authorities shall not use a negotiated settlement to disregard their obligations.
ii. In accordance with the law, public officials participating in a procedure aimed at reaching a negotiated settlement shall be provided with sufficient powers to be able to compromise.
4. Arbitration
i. The parties should be able to choose the law and procedure for the arbitration within the limits prescribed by law. Subject to the law and the wishes of the parties, the arbitrators' decisions can be based upon equitable principles.
ii. Arbitrators should be able to review the legality of an act as a preliminary issue with a view to reaching a decision on the merits even if they are not authorised to rule on the legality of an act with a view to it being quashed.
PART B
EXPLANATORY MEMORANDUM ON THE RECOMMENDATION Rec(2001) XX ON ALTERNATIVES TO LITIGATION BETWEEN ADMINISTRATIVE AUTHORITIES AND PRIVATE PARTIES
INTRODUCTION
1. Administrative law concerns the organisation of public administration but also the control of relations between public authorities and private individuals.
2. Disputes occur between them, for the resolution of which specific judicial procedures have been established under national legal systems.
3. For some time now, increasing problems have been observed in this area: overburdening of the courts in general and those with jurisdiction in this type of dispute in particular; and inappropriateness of judicial proceedings to certain types of dispute. This problem is common to all Council of Europe member states. The need to find alternative means for more effective resolution of such disputes has thus become plain.
4. The Council of Europe member states rely to differing degrees on alternative procedures for resolving disputes generally. The most familiar examples are mediation in criminal cases and in the family law sphere. These procedures are on the whole less common in the administrative field, although this observation needs to be qualified according to country.
5. The development of alternative means for settling disputes between the administration and private parties is due to situational and structural factors.
6. As regards the former, some countries have not yet instituted courts with the requisite efficiency and jurisdiction to settle administrative disputes, and establishing alternative means can ease the transition pending a readjustment of the balance between public administration and justice. Moreover, in some countries the resources of courts are inadequate in both quantitative and qualitative terms. In this context, recourse to alternative means of resolving administrative disputes is a temporary expedient until such time as the courts are improved. Where the proper courts do not exist, extra-judicial solutions can be applied, and congestion in the courts further warrants the use of such means.
7. Apart from situational reasons, there are structural factors: citizens are now more aware of their rights and of what they can claim, and traditional judicial procedures no longer suffice to fulfil their need for justice. In addition, court procedures remain too formal and generally lack flexibility. The need for more flexible machinery to attenuate the formality of the justice system and guard against the risks inherent in this formality has stimulated efforts to find alternative means which also allow disputes to be settled on an equitable basis and not just according to strict legal rules.
8. For the above reasons, the Council of Europe has been interested for some years in the introduction and extension of these alternative means in the various member states, though without discounting the importance of administrative justice, which is the ultimate safeguard for the rights of citizens and of the administration, in accordance with the European Convention on Human Rights.
BACKGROUND
9. Recommendation No. R (2001) XX is the end result of work commenced in 1999 by the Project Group on Administrative Law (CJ-DA) under the aegis of the European Committee on Legal Co-operation (CDCJ). The CJ-DA received terms of reference from the Committee of Ministers to conduct an activity on “alternatives to litigation between administrative authorities and private parties”, with the object of considering the possibility of introducing alternative means of resolving disputes in the Council of Europe member states.
10. Inspired by this goal, the Council of Europe, in association with the Portuguese Ministry of Justice, held a multilateral conference on "Alternatives to litigation between administrative authorities and private parties: conciliation, mediation and arbitration" in Lisbon from 31 May to 2 June 1999.
11. The conference was held in the dual framework of intergovernmental activities - through the agency of the CJ-DA - and the ADACS programmes for the development and consolidation of democratic stability, and on that account was a ground-breaking exercise combining the Council's two key programmes. At the close of the conference, the participants adopted conclusions that provided the basis for continuing the activity on this subject at intergovernmental level (the proceedings of the conference have been published under the reference ISBN 92-871-4206-8).
12. Following the Lisbon conference the CJ-DA, assisted by a working party (CJ-DA-GT) made up of international experts - Professors Caupers Delvolvé, Fortsakis and Partington - and governmental experts, embarked on a study aimed at defining common principles that could guide member states in the reform or introduction of alternative means for resolving disputes between administrative authorities and private parties. At the same time, it asked the Secretariat to collect information on use of the alternatives to administrative litigation existing in the member and observer states.
13. The CJ-DA-GT held three, and the CJ-DA two, meetings on this topic in 1999 and 2000, and prepared a draft recommendation of the Committee of Ministers on alternative means of resolving disputes between administrative authorities and private parties, which was approved by the CDCJ at its 75th meeting from 30 May to 1 June 2001 and by the Committee of Ministers at its 762nd meeting on 5 September 2001.
14. The CJ-DA also drew up a summary report on alternatives to litigation between administrative authorities and private parties, on the basis of replies given by the Council of Europe member and observer states to a questionnaire. The report forms Appendix I to this document.
THE COMMITTEE OF MINISTERS RECOMMENDATION
15. The Committee of Ministers recommendation to member states draws attention to the overburdening of tribunals, including administrative tribunals, resulting in interference with the rights of litigants within the meaning of Article 6.1 of the European Convention on Human Rights which secures the right to a hearing within a reasonable time.
16. It calls for remedies to this interference and stresses that alternative means of resolving disputes can provide a worthwhile avenue in this respect, with the further advantage of bringing the administration closer to the public by avoiding antagonism between the parties to the dispute, and thus providing a more fitting solution for certain types of dispute.
17. The recommendation then points out the other advantages of alternative means, chiefly, speed in reaching the decision, minimal formality, discreet and friendly nature of the procedure, recourse to experts, possibility of settling the dispute on the basis of equitable principles, and economy of the procedure. Of course these advantages apply in varying degrees according to the alternative means considered: some arbitration procedures between the state and large firms, for example, can prove comparatively costly.
18. One prominent feature of judicial procedures is their formality, a safeguard inherent in justice which nevertheless accentuates disputes and impairs procedural flexibility. Going to court thus resembles a legal battle, especially in administrative litigation where the applicant challenges an act taken by the administration.
19. This may cause a hardening of positions since the administration, when challenged before a court, does not want to appear to be in the wrong, either to the court or to the citizen. Even if it agrees to make concessions, they are obstructed by procedural factors (time limits to be observed, written submissions to be lodged, representations to be made) and more fundamentally by the judicial machinery itself. Any exchanges of documents and submissions which may occur as part of the procedure are not for the purpose of inducing the parties to concede something in return for something else, but for that of giving each party access to what the other tells the court. So this does not bring the parties closer together but divides them further.
20. It ends with a court decision that settles the dispute, and this is emphasised by the force of the judgment delivered, not only because it is mandatory but also because it subjects factual arguments to the rigour of law. Administrative courts do of course take the circumstances into consideration in order to determine the case, but cannot do so on equitable or discretionary principles.
21. In many cases, however, citizens' complaints warrant neither the solemnity nor the rigidity of justice.
22. Those concerned do not object to the principle of an act; they merely ask that its operative aspects be better adapted. Nor does the administration necessarily adopt a hard and fast position; rather, it may be amenable to adjustments.
23. More flexible arrangements than those of legal process are the way to find solutions. For instance, conciliation brings the interested parties closer together, and mediation can offer a compromise (in broad terms, as distinct from the special sense it has in arbitration). Thus the flexibility of these arrangements relieves the formality of justice and averts the risks inherent in it.
24. Formality and conflict are not avoided in arbitration since it is of a judicial nature, but for one thing the formality is not due to the state and for another, conflict is mitigated by the parties' agreement on one point at least: having recourse to arbitration. In addition, the arbitration agreement divests the dispute of the adversarial character which it has before a court.
25. One of the advantages of arbitration and other alternative means is the possibility of calling in experts to resolve the dispute.
26. Another very significant advantage of alternative means is the possibility of settling the dispute according to equitable principles. On the face of it, this may seem hard to reconcile with the principle of legality to which the administration is subject, but experience has demonstrated in some countries that the principle of equity can be used in disputes between administrative authorities and private parties.
27. When preparing the recommendation, the concept of equity was discussed. Equity can be taken either in the strict sense or in the broad sense. In the broad sense, the principle of equity refers to the idea of justice based on reason rather than that of justice based on law. In a narrower sense, equity is a corrective to written law when applying the latter has manifestly disproportionate consequences. It can also be used to fill gaps in legislation and regulations in specific cases which they do not cover.
28. In civil law countries, equity underlies a number of fundamental legal constructs such as the "general rules of law" incorporated in constitutions, and can be applied as such unless a special law expressly provides for it. In common law countries, on the other hand, equity forms an integral part of the law as stated and applied by the courts.
29. Lastly, the public character of justice may detract from it in certain cases. Although a public hearing is a requirement stated by Article 6.1 of the European Convention on Human Rights, the parties to a dispute, especially of a business kind, are in need of confidentiality not afforded by public justice but permitted by private justice. This is one of the reasons for the success of arbitration, and can justify its extension in the administrative sphere where, however, the principle of confidentiality is tempered by that of transparency. This is made clear in the paragraph of the appendix dealing with regulation.
30. After listing the advantages of alternative means for resolving administrative disputes, the recommendation observes that the use of courts, while not always the most suitable way of resolving administrative disputes, nonetheless remains necessary; alternative means should not be a substitute for it but a complement to it.
31. Likewise, the recommendation recalls that, when using alternative means, administrative authorities should respect the principle of legality and that neither they, nor the private parties should view or use alternative means as a way of avoiding their obligations.
32. The recommendation points out that, in availing themselves of alternative means, member states should ensure that the fundamental principles of equality, impartiality and the rights of the parties are upheld. Respect for these principles must be guaranteed through review by the courts which constitutes the ultimate guarantee protecting the rights of the public and the administration alike.
33. In its substantive part the recommendation invites member states to promote the use of alternative means for resolving disputes between administrative authorities and private parties by following the principles of good practice contained in the appendix.
THE APPENDIX
34. The purpose of the appendix is to provide member states with indications enabling them to comply with the Committee of Ministers recommendation.
I. GENERAL PROVISIONS
1. Subject-matter of the recommendation
35. The appendix begins by listing the alternative means covered by the recommendation: internal reviews, conciliation, mediation, negotiated settlement and arbitration. Although there might be some other alternative means, an effort was made to be as exhaustive as possible in the light of the various legal systems and administrative traditions. Moreover, the importance of the institution of the ombudsman was stressed as an alternative means but it is not dealt with in the present recommendation since the Council of Europe has already several instruments in this respect (see paragraph 62 hereafter).
36. A major problem was the definition of the subject-matter of the recommendation, in that the concepts relied on are variously defined in the member states, not all of which even contemplate the existence of some of these means in their domestic law. Moreover, some countries used some terms, for example conciliation and mediation, in an undifferentiated way. Therefore the definition effort was confined to the requirements of the activity.
37. For the purposes of the recommendation, terms are defined as follows:
38. Internal reviews: an appeal procedure before a competent administrative authority;
39. This competent authority can be the authority which issued the contested act, a higher authority in the administrative hierarchy or an authority especially designated for that purpose.
40. Conciliation: a non-judicial procedure involving a third party which aims to bring the parties to a mutually acceptable solution;
41. Depending on the case, conciliation may result in a negotiated settlement between the parties (see below) or in a unilateral act taken by the administrative authority, such as the withdrawal of the contested act.
42. Mediation: a non-judicial procedure involving a third party who proposes a solution to the dispute in the form of a non-binding opinion or recommendation.
43. The terms conciliation and mediation are not understood in the same way in the various member States of the Council of Europe and some of them do not make a distinction between the two. Yet, it was considered useful to highlight the distinction between the two notions and in this connection retained the above definitions for the purposes of the recommendation (see paragraphs 61, 92-94).
44. Like conciliation, mediation may result in a negotiated settlement between the parties or in an unilateral act taken by the administrative authority. In some countries, no differentiation is made between conciliation and mediation.
45. Negotiated Settlement: an agreement resulting from any of the above mentioned procedures or any other procedure by which the parties put an end to their dispute.
46. Negotiated settlement, unlike other means envisaged by this recommendation, is inherently an act. However, as it always results from a procedure, be it a conciliation or mediation procedure, or any other form of negotiation between the parties, it also finds its place among the alternative means of resolving disputes.
47. Arbitration: a procedure under which the responsibility for settling a dispute outside the court system by a decision legally binding on the parties is entrusted to one or several persons specially nominated.
48. The alternative means, typified by great diversity, nevertheless have in common a non-State character. On the other hand, they are either non-judicial (mediation and conciliation) or judicial (arbitration).
49. The protagonists in these procedures are the administrative authorities on one side and private parties on the other. Obviously the law applicable to disputes varies according to country: administrative law in some cases and private law in others.
50. In the course of the preparatory work, dispute prevention was discussed in depth. A distinction should be drawn between means of preventing disputes and means for resolving disputes. Chronologically speaking, they take place at different stages in the relations between the administration and private parties. The following chart illustrates this distinction.
51. Means for preventing disputes, such as public enquiries, consultation and negotiation, are forms of dialogue between the public and the administrative authorities which are usually incorporated into the process of preparing the administrative act.
52. Consultation and negotiation received particular attention.
53. The process of consultation or hearing of grievances presupposes obtaining the opinion of the parties affected by the administrative act. Private parties are thereby informed of the reasons why the administration intends to adopt an act and given the opportunity to state their opinions and possibly take part in the process of preparing the act. This process operates chiefly in financial and social matters. In the town planning sector there is also the public enquiry mechanism, akin to consultation.
54. Negotiation presupposes joint action by the administration and the public, involving a common effort by parties with convergent, coinciding or even opposing interests to arrive at an agreement conducive to harmonisation of their respective lines of conduct. It thus comprises various forms of dialogue between administrative authorities and private parties, and in some cases can help to settle an existing dispute, although its primary aim is to prevent disputes. Negotiation often ends in a settlement of a contractual nature, particularly in cases where it sets out to settle a dispute rather than prevent it.
55. These preventive means encourage citizen participation in the administration's activities and provide the public with better information about them. In this way the administration becomes more accessible to the public, while also being better informed of the public's views on planned schemes. The intention is to prevent a dispute arising over the act to be taken by the administration when these procedures are completed.
56. Despite these efforts to establish a dialogue between the public and the administrative authorities, the act ultimately taken by the administration may nevertheless adversely affect individual citizens, who will then have a range of remedies at their disposal.
57. These include "traditional" applications to the courts. The purpose of the recommendation is to promote alternative means for resolving disputes, such as internal reviews, mediation, conciliation, negotiated settlement and arbitration. These must be regarded as alternative means to settlement by the courts. In particular, they serve to bypass the stringency of standard procedural rules.
58. It must also be borne in mind that the recommendation concerns only alternative means of resolving disputes between the administrative authorities and private parties. It does not cover criminal matters or family law, for example.
59. Lastly, the Ombudsman institution, in many countries an important means of preventing or resolving disputes between the administration and private parties, is deliberately omitted from the subject-matter of the recommendation In this respect, it should be noted that the Committee of Ministers has already prepared several recommendations. Thus, Recommendation No. R (85) 13 of the Committee of Ministers to member states on the institution of the Ombudsman, which states in its preamble that “the functions of the Ombudsman [involve], inter alia, consideration of individual complaints concerning contended errors or other shortcomings on the part of the administrative authorities with a view to enhancing the protection of the individual in his dealings with those authorities”. Worth mentioning are also Resolution (85) 8 on co-operation between the Ombudsmen of member states and between them and the Council of Europe, which resulted in the organisation of regular Round Tables with European Ombudsmen, as well as Recommendation No. R (97) 14 of the Committee of Ministers to member states on the establishment of independent national institutions for the promotion and protection of human rights, which recommends to the member states to “consider (…) the possibility of establishing effective national human rights institutions, in particular (…) Ombudsmen or comparable institutions.
2. Scope of alternative means
60. During the preparatory work, the question of whether alternative means were applicable to any type of dispute between the administration and private parties, or whether certain disputes should be handled solely by the courts was considered.
61. To answer this question, a distinction should be drawn between proceedings in rem, where the lawfulness of an administrative act is challenged, and proceedings in personam, which are based on infringement of rights, where the appellants complain of interference with a position that is specific to them.
62. As explained in the appendix, the area of rights, particularly contracts, civil liability and claims relating to a sum of money, seems to be the ideal field for alternative means. Given the diversity of legal traditions and systems, it was decided to leave member states the option of accepting alternative means for general purposes or for certain types of dispute only, while attaching certain restrictions in respect of each specific alternative means (mentioned below). It also stressed that the appropriateness of alternative means would vary according to the dispute in question.
63. Arbitration is particularly suited to and thus well developed in the area of contracts, as witness the arbitration clauses adopted by the parties when concluding the contract. This has already been illustrated in certain contracts of the state administration, but is visibly suspect to certain bodies of legislation or courts.
64. Nonetheless, the value of developing it should be emphasised at least for certain types of contract concluded by the administrative authorities, such as the government procurement contracts which, at an agreed price, assign to firms the conduct of work or the provision of supplies or a service, and which do not directly affect the actual tasks of the administration, or the contracts whereby a public authority assigns a public service function to a firm - public service franchises in particular - or again the contracts concluded by public entities with firms abroad. In this last case arbitration can secure a more adequate settlement of disputes arising from such contracts than is possible by applying to the courts of the state to which the public contracting party belongs.
65. While arbitration thus presents itself as the alternative means likely to become most widespread in contractual matters, it does not exclude others. Conciliation and mediation can also help to settle contractual disputes. More so than arbitration in some cases, and even prior to arbitration, they can make it possible to achieve a result.
66. In non-contractual litigation, however, it seems that conciliation and mediation should take the lead over arbitration, especially for minor disputes relating to redress of damage or other wrongs complained of by individuals, for which arbitration procedure is plainly too cumbersome and costly and conciliation and mediation seem more suitable.
67. As regards proceedings in rem, where the lawfulness of an administrative act is contested, courts appear a priori the only ones capable of determining contention of this kind, with the effect of invalidating an act of the administration. Even so, a distinction should be drawn between individual acts and acts with a general impact, and between direct and indirect challenges to the validity of the act. Direct objection to an administrative act with a general impact by means of an application to have the act set aside, or in some cases even supplanted by another act, does not lend itself to alternative means, and only the courts should be authorised to wield power in that respect.
68. Conversely, conciliation and mediation procedures do not appear impracticable in the case of objection to an individual administrative act, for the simple reason that they do not result in a forced solution and merely seek to reconcile the respective positions by proposing a measure. Whatever degree of persuasion the conciliator or mediator tries to achieve, these procedures neither dispense with nor supplant the decision of the administration which alone has the last word.
69. In consequence, it is acceptable to submit an objection to an individual administrative act to a conciliation or mediation procedure, which may in certain cases be more appropriate than proceedings before a court. Building permits are one example. When such a permit is issued it may be challenged by neighbouring landowners not so much because they object to any construction scheme but because they consider the planned building oversized. If they bring an application for annulment to a court, the proven illegality of the permit entails its outright cancellation. A conciliation or mediation procedure, however, allows the applicant to be brought into contact not only with the public authority but also with the recipient of the permit, and a meeting between all parties may result in the adoption of a position on which all agree. The permit may be altered by the issuing authority in accordance with this "agreement", thereby averting litigation and possible annulment of the permit.
70. Arbitration, like mediation and conciliation can be used where the legality of an individual act is challenged indirectly.
71. Indirect challenge means an application with the object not of setting aside or modifying an administrative act but of achieving a different result on the ground that the act is contrary to law. The simplest example is a claim for compensation to redress a wrong which according to the claimant was brought about by an unlawful act. The claim does not seek annulment of the act but merely an order compelling the authority which adopted it to provide redress for its injurious consequences. To determine whether the victim is entitled to compensation, it must be ascertained beforehand whether the injurious act is unlawful, but even where this is found to be the case the act need not be annulled.
72. It is therefore possible for an objection invoking illegality to be raised not only in conciliation or mediation procedures but also under arbitration procedure, provided that the claim comes within the definition of litigation concerning infringement of rights.
3. Regulation of alternative means
73. This provision lists the points to be considered and included in any arrangement for regulating alternative means of resolving disputes between the administrative authorities and private parties. These points comprise ensuring fair proceedings and respecting the principles of impartiality and equality and the rights of the parties. Where conciliators, mediators and arbitrators are concerned, the principle of independence should also be respected.
74. The other points are intended to make member states aware of questions requiring special consideration, such as informing parties on the existence of alternative means, transparency in the use of alternative means and its necessary conciliation with a certain level of discretion, suspension of the effects of an impugned administrative act and the need to ensure the execution of the solution achieved. These questions should be addressed in all regulations on the subject.
75. During the preparatory work, the question of confidentiality of proceedings was considered at some length. As indicated above, this is among the advantages of the alternative approaches and in some cases is even the reason for using them. However, it may give rise to improperly granted advantages. It should therefore be limited to what is strictly necessary, especially in the course of the procedure, and reconciled with the principle of unrestricted access to administrative documents.
76. The suspension of the effects of the disputed act was also discussed, together with the question of who could decide to suspend them. The wording adopted in the appendix refers to three possibilities: a. suspension of the disputed act may be automatic, by law; b. the courts may decide to grant suspension on a case-by-case basis, and it was agreed that the member states' legislation should provide for this possibility even if the court does not deal directly with the dispute; and c. suspension of the act may be decided by the authority that took it. This last possibility does not exist in all the member states: legislation in some countries provides that the administrative authorities may only repeal or modify the disputed act.
II. RELATIONSHIP WITH COURTS
77. This chapter is of particular importance. It contemplates the various possible types of relationship between alternative means and legal proceedings.
78. Usually, alternative means are used before recourse to the courts, precisely in order to avoid it. Internal reviews, conciliation, mediation and negotiated settlement may be used for this purpose. To make full use of this possibility and thus help to alleviate the courts' caseload, use of these means may be made a prerequisite for the commencement of legal proceedings.
79. However, even when proceedings are pending before the courts, some alternative means such as conciliation, mediation and negotiated settlement remain useful because they may help to resolve the dispute faster than traditional litigation; the court itself may therefore recommend using them, thereby incorporating them into the proceedings.
80. By contrast, arbitration is in a special position in terms of the relationship with courts. Both, court proceedings and arbitration require somebody to make a binding decision on the matter in dispute, and there can only be one decision.
81. After contemplating these various possibilities in the relationship between alternative means and courts, the appendix points out, as does the recommendation itself, that the courts must retain a certain capacity for review of alternative means, especially because, as indicated above, these means must respect the principles of equality between the parties, respect for the rights of the defence, and independence and impartiality of conciliators, mediators and arbitrators. Whatever its scope, judicial review of alternative means must at least, therefore, cover respect for these principles.
82. The right of access to the courts and to a fair trial, as established by the European Convention on Human Rights, is a key feature of any democratic society. It is therefore essential that the possibility of applying to the courts for review of administrative acts should be widely available in terms both of the persons entitled to bring proceedings and the acts subject to review. The administration's acts affect the entire population on a day-to-day basis and directly relate to the individual rights and freedoms recognised in particular by the European Convention on Human Rights.
83. The appendix specifies that depending on the alternative means considered and on national legislation, judicial review will be confined to checking that the alternative procedure has been properly applied and has observed the statutory safeguards - judicial review of this kind can be envisaged, for example, in respect of arbitration, which is in the real sense an alternative form of legal proceedings - or the court may rule on the merits of the dispute and therefore review the content of the agreement between the parties. The handbook "The Administration and You" prepared by the CJ-DA states that in this case judicial review must at least concern the legality of the administrative act, but may also cover questions of fact. It adds that "judicial control of administrative acts involving the exercise of discretionary powers by the administrative authorities is inevitably less stringent than in the case of those acts which involve measures which are obligatory for the administrative authorities. Thus, it is a generally recognised principle that an administrative authority cannot be judicially compelled to exercise a power which is purely discretionary. Nonetheless, judicial control over the exercise of discretionary power ensures that, when an administrative authority exercises a discretionary power, it does so within the limits and purposes for which, under the law, it enjoys discretion."
84. The last paragraph of this chapter sets out the principle that the use of alternative means should result in suspension or interruption of the time-limits for commencing proceedings before a court. This is to preclude private parties having to choose between two procedures - court proceedings and an alternative procedure - to resolve their disputes. In practice, this choice, which is currently the rule in some member states because the time-limits for appeal are so short, deprives alternative means of some of their meaning.
85. This possibility of choosing between court proceedings and an alternative is offset, as specified in the part of the appendix concerning regulation, by the recommendation that national legislation should prescribe strict and reasonable time-limits for the conclusion of alternative procedures in order to afford the widest possible access to the courts, in line with the European Convention on Human Rights.
III. SPECIAL FEATURES OF EACH ALTERNATIVE MEANS
1. Internal reviews
86. Internal reviews aim to secure the revision of an administrative act or the payment of compensation. They are addressed to the administrative authorities themselves and, depending on the systems used in the member states, consist in either an appeal to the authority which issued the contested act, or an appeal to a higher authority in the administrative hierarchy, or an appeal to another authority specially designated for the purpose.
87. Internal reviews are intended to enable the administrative authorities to reconsider their act for reasons of legality or expediency. They should be available in relation to any act and in some may be a prerequisite for subsequent referral to a court.
88. The outcome of internal reviews, if they are successful, is the amendment or setting aside of the administrative act challenged, or the payment of compensation.
2. Conciliation and mediation
89. Although they are defined and perceived differently from one country to another, these two alternative means are closely related. They are flexible procedures relying on the intercession of a third party to achieve a result. They are not court procedures resulting in an actual judicial ruling, nor even always contractual procedures governed by an agreement between the parties. They may be opened quite irrespective of any contract and never result in a decision that binds the parties involved in the dispute. They are purely procedures aimed at seeking, without imposing, a solution that will end the dispute.
90. However, the two procedures are not to be confused. Conciliation is intended to draw the parties together, induce them to reconcile their positions and guide them in discovering a meeting-point between these positions. Mediation, on the other hand, assigns the person conducting it a role as intermediary between the parties in order to work out a proposed solution based on the positions of the parties.
91. Conciliation and mediation would thus appear to differ more in degree than in nature, as they involve convergence between the parties allowing the interceding body scope for initiatives and enabling it to seek solutions. Nonetheless, conciliation does not give rise to any document issued by the conciliator to formalise the solution which he or she considers appropriate, whereas the mediation procedure concludes with the mediator recommending a solution. The contrast is therefore more marked at the conclusion than in the course of each procedure. During the procedure, the conciliator and the mediator both try to bring the parties and their standpoints closer together. At the close of the procedure, the conciliator can only find that agreement is reached or that disagreement persists, whereas it is not for the mediator to make such a finding but to state what arrangement should be adopted. The mediator's recommendation, unlike an arbitral award, is not mandatory but constitutes an official position which, failing legal authority, does in fact possess a force that may prompt the parties to acquiesce.
92. Where conciliation and mediation are concerned, the final outcome remains the responsibility of the parties; the expression of their will is what ordains the adoption of this solution.
93. The appendix defines the framework in which conciliation and mediation can operate in administrative litigation. These two means are prevalent in matters concerning the administration's discretionary power, and are not aimed as a rule at determining the legality of administrative acts, which is a matter for the courts. However, it may incidentally be required of mediators or conciliators to assess the legality of a given act. The use of conciliation or mediation can also be considered in connection with the administration's obligation to apply the law without exercising discretion. An example is the occupation of the administration's public property by demonstrators, a case in which a conciliation procedure could convince the demonstrators to leave the premises. Likewise, conciliation can be considered in tax matters, another area in which the authorities are required to apply the law without exercising discretion.
94. Conciliators and mediators may be individual or plural (a board) and must be impartial, independent, committed to their role and proficient in human relations, and combine power of persuasion with communication skills. In addition, they are required to have certain professional qualifications: knowledge of laws and regulations relating to administrative and disputes procedure, and of the methods and practices of negotiation. Lastly, they must be suitably trained.
95. The appendix further points out that a conciliation or mediation procedure can follow from a request by the parties concerned - the most frequent instance - or be proposed by a judge or required by law. The authority to which the dispute is referred may be the actual conciliator or mediator, the board or the administrative department concerned by the contentious issue.
96. During the preparatory work the possible relationship between a conciliation or mediation procedure and simultaneous proceedings before the courts was considered. It was pointed out that where such a procedure took place at the request of a court, as part of the actual court proceedings, it was not covered by the CJ-DA's terms of reference and was to be regulated by the Code of Procedure.
97. After obtaining the requisite information from the parties, the conciliator or mediator meets either with both parties together or with each individually. These meetings enable the parties to engage in discussions moderated and conducted by the conciliator or mediator and are confidential when held individually.
98. The conciliator's responsibility is accordingly to help the parties in an administrative dispute arrive at an agreement to sink their differences. The conciliator clarifies the dispute, encourages the parties to discover points of agreement and, if they cannot, makes suggestions. At the conclusion of the procedure, a final report is drawn up by the conciliator who helps the parties frame their agreement, in the form of a contract.
99. In a mediation process, on the other hand, the mediator is expected to propose solutions for resolving the dispute. Mediation normally leads to recommendations made by the mediator or to a reasoned proposal for the settlement of the dispute. Since mediation does not impose a forced solution, its outcome often takes the form of a compromise or negotiated settlement.
100. The appendix points out that conciliators and mediators cannot set aside administrative acts. If they consider that an act is illegal or not expedient, they must attempt to persuade the administrative authorities to withdraw it. During the preparatory work the effect a successful conciliation or mediation procedure might have on the reasons given for the disputed administrative act, and particularly the question of whether the administration's acceptance of a solution achieved by this means could suffice to satisfy the obligation to give reasons for the act was considered. In the end, it was decided not to mention this possibility because a conciliation or mediation procedure is not binding on third parties.
3. Negotiated Settlement
101. This is the contract whereby the parties in a dispute put an end to it amicably. A negotiated settlement is often, but not exclusively, the upshot of negotiation between the parties or of a conciliation or mediation procedure, and serves equally as a means of preventing and of resolving administrative disputes.
102. Its essential feature is that it is a contract concluded by the parties and binding upon them. In this respect it has something in common with arbitration, to the extent that it entails the agreement of the parties. Unlike arbitration, however, this agreement does not open the procedure but terminates it and concerns the substantive issues.
103. Likewise, as with arbitration, a negotiated settlement is binding on the parties that conclude it.
104. Although it is their frequent outcome, negotiated settlement is not intrinsically linked with conciliation and mediation procedures, and the fact that these do not necessarily end in a negotiated settlement, even if they succeed, is not the only reason; rather, negotiated settlements can be reached by the parties without a mediation or conciliation procedure having been conducted beforehand.
105. It was agreed that negotiated settlement was a useful method in administrative matters and noted that it was not sufficiently used in the member states.
106. In the paragraph on negotiated settlement, the appendix lays down some guidelines for administrative action in the matter: public officials authorised to make compromises must be assigned the proper powers for that purpose, however, they cannot make a negotiated settlement to disregard one of their duties, and inter alia, to override a public policy obligation.
107. The question of whether it should be specified in the appendix that an administrative authority may not promise to pay a sum of money it does not owe was discussed. Common law countries have the institution of ex gratia payments, which means that the Ombudsman can persuade the administration to pay, of its own accord, a sum of money it does not owe by way of compensation for a wrong. But in other countries administrative case-law systematically declares that negotiated settlements in which an administrative authority has agreed to pay a sum of money are null and void and that there is no principle whereby the administrative authority's liability can be established. The wording used in the appendix thus allows national legislation to provide for such a restriction on the administration's powers of reaching a negotiated settlement, without making this compulsory.
4. Arbitration
108. The term can have several meanings. Some official texts speak of arbitration in the broad sense as denoting a procedure leading to a non-judicial decision taken by an administrative authority that settles a conflict between opposing interests. But it is not arbitration in the strict sense as the decision taken does not have the force of res judicata.
109. Even though the concept of arbitration in the strict sense is the subject of debate and probing analysis, the following definition was agreed upon for the purposes of the recommendation: arbitration is a procedure under which the responsibility for settling a dispute outside the court system by a decision legally binding on the parties is entrusted to one or several persons specially nominated.
110. Arbitration may be used either under an arbitration clause introduced into a contract in order to resolve any disputes that may arise from its application, or under an express agreement for the settlement of disputes that have already arisen.
111. Arbitration thus has two essential characteristics: it is both a contractual and a judicial procedure. It is contractual in that arbitration stems from an agreement by the parties to have the dispute settled in this form (express agreement) or from a contractual clause (arbitration clause) whereby the parties undertake to submit to arbitrators any disputes which could arise through the application of the contract. It should be pointed out here that some countries' legislation provides for compulsory use of arbitration in certain types of dispute.
112. It is judicial in that arbitrators, even when not judges, act as such and are required to observe the principles of judicial process in general, and handing down a decision (the arbitral award) which is a true judicial ruling setting out the solution to the dispute with the force of res judicata. Like judges, arbitrators thus have jurisdiction but, not being judges, lack imperium i.e.: cannot themselves make their decision enforceable. While the parties are bound to comply with the award because it has the force of res judicata. The national legislation will decide whether an arbitral award requires a separate writ of execution in order to be enforceable.
113. In this way, the appendix stresses the judicial nature of arbitration, which requires the intervention of a third party who acts as a specially appointed private judge. This approach ensures that a solution is effectively reached, as arbitrators are true judges. They are chosen, as the case may be, either by the parties or by persons or institutions specially authorised to do so, and the solution, having the same value as a judgment, is binding on both parties to the dispute and in general cannot be appealed on the merits.
114. Use of arbitration is comparatively rare in the context of disputes between the administration and private parties, but has certain advantages such as the possibility of choosing arbitrators with special technical expertise which may make its use worthwhile.
115. However, arbitration in the administrative field must invariably be considered as an alternative means for settling disputes, ancillary to administrative justice in precisely defined areas, which is why the appendix lays down certain principles which should preside over its use, in particular that this method should be expressly permitted by law and cannot have the object of ruling on the legality of an administrative act.
* * *
116. As stated above, the principles set out in the appendix to the recommendation are the outcome of detailed discussions and particularly examination of the current situation in this regard in the various member states. In addition to the theme-specific reports of experts and the national reports presented at the multilateral Conference on "Alternatives to litigation between administrative authorities and private parties: conciliation, mediation and arbitration", held in Lisbon from 31 May to 2 June 1999 (ISBN 92-871-4206-8), and the conclusions adopted on that occasion, the recommendation draws on the replies to a questionnaire given by 22 member states, on which a summary report follows.
SUMMARY REPORT ON THE SITUATION OF ALTERNATIVE MEANS TO LITIGATION BETWEEN ADMINISTRATIVE AUTHORITIES AND PRIVATE PARTIES IN SOME MEMBER STATES OF THE COUNCIL OF EUROPE
117. The Council of Europe's Project Group on Administrative Law (CJ-DA) has carried out in 1999 and 2000 an activity entitled Alternatives to litigation between administrative authorities and private persons, which looked at the possibility of extending such alternative methods of settling administrative disputes in the organisation's member states.
118. As part of this activity, the CJ-DA and the Portuguese Ministry of Justice jointly organised a multilateral conference on "Alternatives to litigation between administrative authorities and private persons: conciliation, mediation and arbitration", held in Lisbon from 31 May to 2 June 1999.
119. The conclusions adopted by the conference participants have formed the basis of subsequent work in this field. At its 12th meeting, held in Strasbourg from 14 to 17 September 1999, the CJ-DA instructed the secretariat to use the Lisbon conference's conclusions as the basis for a questionnaire on alternatives to litigation between administrative authorities and private persons in the member states and CJ-DA observer countries. The questionnaire appears in appendix I.
120. The following report is based on the replies to the questionnaire from Andorra, Belgium, Bulgaria, Croatia, Czech Republic, Cyprus, Estonia, Georgia, Greece, Iceland, Moldova, Norway, Poland, Portugal, Romania, Russian Federation, Slovakia, Slovenia, Sweden, Switzerland, Turkey and the United Kingdom, and on the national reports presented to the Lisbon conference, particularly those of Finland, Hungary, Italy, Lithuania, Malta, Spain, and "the former Yugoslav Republic of Macedonia".
121. Certain comments need to be made about the scope of this study. It is only concerned with alternatives to litigation in the administrative sphere, that is disputes opposing the authorities and private persons – both individuals and legal persons. It is not concerned with out-of-court means of settling disputes in other fields of law, such as family law or mediation in criminal cases.
122. The report has chosen deliberately to say little about the issue of internal review, since this is a preventive approach or an alternative to litigation that occurs and is widely used in all national legal systems. Its relevance to this activity, which is concerned with the possibility of extending the range of remedies to include alternative, less well known, approaches, is therefore limited.
* * * * *
123. The first point to emerge from the information provided by States on the basis of the questionnaire[1] is that, in general, member states' and observers' legal systems offer few alternative methods of settling disputes between administrative authorities and private persons. There are various reasons for this. In many central and east European countries the current priority is the establishment or strengthening of the administrative justice system, which constitutes major progress in countries where, under Communist regimes, it was not possible to take the authorities to court. However, alternatives are not widely used in other countries, whether because, as in Finland or Norway, the general system works satisfactorily and there are therefore few demands for alternative ways of settling disputes, or because, as in Belgium, historically the system for settling disputes has developed according to needs, in a fairly unstructured manner, and alternative approaches only concern particular areas.
124. In the majority of countries, alternatives to administrative litigation are thus confined to specific areas, in particular compulsory purchase, the sub-contracting of public services and public contracts in general. Examples of the general use of alternative approaches in the administrative domain are fairly rare, the best certainly being that of Lithuania, which recently established a system of extra-judicial administrative remedies.
125. As the conclusions of the Lisbon conference pointed out, alternative procedures may be used to prevent disputes, or to settle them once they emerge.
I. PROCEDURES FOR PREVENTING LITIGATION BETWEEN THE ADMINISTRATIVE AUTHORITIES AND PRIVATE PERSONS
126. According to the conclusions of the Lisbon conference, prevention procedures are mainly concerned with consultation. Before taking a decision likely to provoke opposition, the authorities should use surveys, hearings and conciliation or mediation machinery to seek the agreement of those concerned; however, the final decision rests with the authorities in accordance with the law.
127. These conflict prevention procedures apply during the period when the authorities are preparing an administrative measure or taking a decision.
128. Such dispute prevention procedures exist in most countries, though not in Bulgaria, Romania, Russian Federation, Slovakia or Turkey.
1. Hearings or consultation
129. The most common method of avoiding administrative disputes is to organise a hearing or some other form of consultation with those concerned by the relevant decision or measure. Such an approach is provided for in the legislation of Andorra, Belgium, Finland, Georgia, Moldova, Norway, Poland, Switzerland and the United Kingdom.
130. Belgian legislation provides for consultative machinery, and associated public inquiries. It makes it possible to explain to private persons why the public authorities plan to take a decision and offers them the opportunity to express their opinion and contribute to the decision-making process.
131. Public inquiries are very frequently used in the fields of town planning, the environment and compulsory purchase in the public interest. They are sometimes followed by consultative meetings. Article 4 of the Walloon regional and spatial planning and heritage code lays down the general principles that apply to all public inquiry procedures, including the following:
- public inquiries must last at least 15 days;
- the relevant documentation must be available to all;
- anyone may seek technical explanations;
- anyone may submit written observations within the prescribed time, or if necessary orally at the end of the inquiry;
- decisions must be publicly displayed;
- the relevant authorities may provide for additional ways of publicising the matter and other forms of consultation.
132. Consultative machinery is mainly used in the economic and employment spheres. Consultation is more institutionalised than public inquiries, since the body consulted is either a specific and existing authority or a committee/commission whose exclusive task is to offer opinions. There are numerous consultative committees, that are consulted either by parliament or the government. Examples include the Belgian Conseil National du Travail (national labour council), which is consulted on issues relating to employment and work legislation. Its members are drawn from the most representative employers' and employees' organisations. The opinions issued may be simply consultative, or they may be binding on the government in cases where the council's approval is required. This consultation procedure has the advantage that it strengthens administrative decision making, by making it more effective in terms of content and implementation.
133. In Finland, some special laws, like the Forestry Act (1093/1996), make it obligatory for the authorities to consult individuals. It may also be obligatory for different authorities to consult each other before a decision is reached on a particular case, as in the Land Use and Building Act (132/1999).
134. More generally, the Administrative Procedures Act and other legislation contain provisions requiring the relevant authorities to seek the comments of the parties concerned by a measure or decision, before the matter is settled. This normally takes the form of written consultation, but where appropriate it may culminate in negotiations between the parties.
135. In Norway, the 1967 Public Administration Act includes a provision concerning the protection of private persons, particularly in cases where the body concerned exercises public authority. In particular a duty arises from this provision to notify and consult, within a certain period, the parties concerned by a decision concerning a specific individual or individuals. The authorities also have a duty to provide guidance to private persons and to take decisions in a transparent manner.
136. In Poland, the 1990 Local Government Act contains provisions on hearings and consultation. Local authorities must consult citizens on all the major problems affecting their municipality.
137. In Switzerland, under federal law, legislation and regulations must, as a matter of principle, be the subject of consultation with the relevant circles prior to adoption. In addition, in certain areas, particularly regional and spatial planning, federal legislation requires the authorities to provide for broad public participation before any measures are approved. Finally, in the case of decisions relating to individuals, the law entitles private persons to give their opinion before any decisions affecting them are taken.
138. In the United Kingdom, consultation is held by means of inquiries, which come in an extreme variety of forms. Inquiries are established in two broadly distinct ways: on an ad hoc basis, to inquire into specific matters, such as a particular Government scandal or catastrophe, or on a regular basis to deal with more routine issues.
139. Inquiries were traditionally used primarily as a mechanism for decision-makers in government to acquire information from a wide range of interested parties. On the basis of the evidence presented to the inquiry, the Inspector or other person running the inquiry might make recommendations to a Government minister, who would retain the ultimate responsibility for arriving at the decision. Inquiries however provided opportunities for wider participation in the information-providing process, and thus in the decision-taking process, than would otherwise have been available.
140. In recent years, however, the nature of some important inquiry procedures, particularly those established on a regular basis, has changed. For example, the inspector who runs planning inquiries which deal with appeals against a refusal of (land use) planning permission by a local planning authority will in most cases (around 95%) have the authority to make the final decision on that planning appeal. In this specific context, therefore, the inquiry process has become much more analogous in terms of its outcome to the functions of administrative tribunals.
141. Even in the inquiry context, there is also a wide variety of procedures. In the land use planning context, for example, the majority of appeals are in fact determined not as the result of a full inquiry, but without any hearing at all – the written representation procedure. And in recent years a more informal oral process, known as the hearing, has been introduced as an alternative to the full-scale inquiry. In practice, inquiries in the strict sense are now limited to major controversial schemes, such as a major new road project, or a major new airport terminal.
2. Negotiation
142. The negotiation means covered here include various forms of dialogue between administrative authorities and private persons, including conciliation and mediation for preventive purposes. Negotiation in this sense of the term exists in Belgium, Czech Republic, Estonia, Greece, Iceland, Italy, Poland and Spain. The process often culminates in a form of compromise settlement.
143. In Estonia, for example, the Planning and Building Act makes persons who have suffered damage from changes to a land use plan eligible for adequate financial compensation from the authorities concerned. The amount of compensation is determined by negotiation between the authorities and the individual.
144. In Iceland, the administrative authorities have the duty to inform and investigate. Regulations require that the administrative authorities clarify the litigation before any decision is taken. They must usually give the parties the opportunity to express themselves, before any decision is taken.
145. In Italy, Act no 865 of 1971 provides for negotiation between administrative authorities and private persons in the field of compulsory purchase. Under this act, the owner of property likely to be compulsorily purchased may agree to its voluntary transfer on the basis of a contract with the authority concerned, thus securing more advantageous compensation. However, even if the owners of property are unable to reach agreement on a voluntary transfer they may, as part of the compulsory purchase procedure, reject the amount proposed by the authorities as compensation and ask for steps to be taken to reach a negotiated settlement. If such an agreement is achieved, it has the status of a contract. National legislation on compulsory purchase often leaves scope for negotiation, as for example in Poland.
146. Italian tax legislation offers another example. Under legislative decree no 218 of 1977, when private persons have paid less tax than they should have, the relevant authorities may negotiate with the individual concerned the extra amount that will have to be handed over. The agreement gives rise to a formal decision that cannot be challenged in the courts.
147. According to the Administrative Procedure Act, in the Czech Republic – Act N 71/1967 – administrative authorities shall provide assistance and advice to the parties to the procedure, so that the latter do not suffer any detriment in the proceedings due to a lack of knowledge of the legal regulation. Administrative authorities shall always try, if the nature of the matter so permits, to settle the matter by conciliation. The Administrative Procedure Act provides for the institution of friendly settlement between the parties to the procedure. The competent authority accepts the compromise settlement “if the nature of the case so permits and if it is not contrary to legal regulation or to a public interest”. A settlement approved by the authority may be executed.
148. Example is given in the Czech regulation: according to the Act on Physical Planning and Construction law (Act N 50/1979), the compulsory purchase of the land can be ordered by administrative decision only after the negotiations aimed at reaching an agreement on the purchase of the property have failed.
II. NON-JUDICIAL PROCEDURES FOR SETTLING ADMINISTRATIVE DISPUTES
149. The conclusions of the Lisbon conference list internal reviews, conciliation and mediation as non-judicial procedures for settling administrative disputes. Compromise settlement and the Ombudsman can be added to this list. These alternative approaches, which come into play once a dispute emerges, are dealt with very differently according to the legal system concerned, since although every European country recognises internal administrative reviews, this is by no means the case with conciliation and mediation.
1. Internal administrative reviews
150. Internal remedies are provided for in the legislation of Andorra, Belgium, Bulgaria, Croatia, Czech Republic, Finland, Georgia, Greece, Hungary, Italy, Moldova, Norway, Poland, Portugal, Romania, Russian Federation, Switzerland and the United Kingdom.
151. In general, a distinction is made between reviews conducted by the authority responsible for the contested measure or decision and ones entrusted to a higher authority. Some countries, such as Bulgaria, Romania and Turkey, make such internal reviews mandatory before a case can be brought before the courts. In others, however, such as Finland and Switzerland, such reviews are being phased out, to be replaced by judicial remedies.
152. In Finland, a rectification system has been introduced in parallel with ordinary internal reviews, particularly in the fields of taxation, social security and municipal affairs. This is an administrative procedure in which an authority that has made an incorrect decision can correct the mistake itself, or a correction can be made in response to an appeal to the authority concerned or to a higher one.
153. In the Russian Federation, any citizen has the right to appeal against acts and decisions violating his rights and freedoms, directly before a court, or before a supervising authority, local authority, ministry, enterprise or a public authority, public person or public servant. The public authority analyses in an objective, exhaustive and impartial way the circumstances of the case in order to appreciate the evidence. If the offence is qualified as a felony, the case is transmitted to a court.
154. In Switzerland, there is a challenge procedure which enables government departments to settle disputes over administrative decisions before cases come before the courts.
2. Conciliation
155. According to the conclusions of the Lisbon conference, conciliation is a procedure in which a third party intervenes to bring the parties' positions closer together to enable them to reach an agreement. Mediation also involves the intervention of a third party, whose role is slightly different from that of a conciliator in that he or she is empowered to put forward a non-binding solution, in the form of an opinion or recommendation.
156. Conciliation and mediation are not unknown in the administrative field, since they are to be found in Belgium, Croatia, Estonia, Hungary, Italy, Lithuania, Portugal and Slovenia.
157. In Belgium, although conciliation is not practised universally, it does form part of the legal landscape. It is governed by special rules, based on various approaches. It may be optional, as in the field of public contracts, or be a precondition for referring a matter to the courts. This is the case, for example, with environmental protection, where conciliation attempts must be made before any consideration of the merits of a case before the president of the court of first instance.
158. In Croatia, the search for an agreement between the parties is actually one element of the administrative procedure. In any dispute, the authority responsible for the case must seek throughout the proceedings to reach an agreement between the parties. If such an agreement is secured, this brings any litigation to an end, either in total or regarding those aspects on which the parties have managed to reconcile their positions. In certain areas, there is specific legislation laying down particular procedures.
159. In Estonia, there is a conciliation procedure for compulsory purchase cases, which seeks to establish the financial compensation to which the expropriated property owner is entitled.
160. In Hungary, section 38 of the 1957 Act on General Rules of Administrative Procedure stipulates that if the nature of a case allows, the authorities must try to reach an agreement with the parties concerned before taking a decision.
161. In Italy, one example of the conciliation
procedure occurs in public employment disputes. Before employees can seek redress in the courts, they are
required to enter a conciliation process before the relevant provincial labour
office. Each of these offices includes
a conciliation bench composed of the office's director, an employee
representative and a representative of the government department
concerned. The procedure laid down
respects the principle of equality of the parties. If the parties reach an agreement, a report is drawn up setting
out the content of the agreement and is enforceable. If the parties do not themselves reach an agreement, the bench
draws up a conciliation proposal, a procedure which then resembles
mediation. If the parties reject this
proposal, it is set out in a report which becomes one of the documents in the
case file during the judicial proceedings.
Employees can only apply to the ordinary courts once the conciliation
attempt has failed, within a period of 180 days.
162. There is a similar system in Portugal for public contracts under which, in the event of any dispute concerning the validity, interpretation or application of a contract, there must be a conciliation attempt before the case can be brought before the courts. This takes place before a commission made up of representatives of the parties and chaired by the president or another member of the public works and transport council, a consultative body attached to the Ministry of Social Infrastructure.
163. Finally, in Slovenia, the Law on the State Attorney introduces an extra-judicial conflict resolution procedure in which private persons who wish to bring an action against the government are first required to propose an out-of-court settlement to the State Prosecutor, who must reply within 30 days. This procedure applies in all fields: civil, criminal and administrative.
3. Mediation
164. Mediation is used in administrative cases in Belgium, Estonia and Lithuania.
165. In Belgium, the institution of mediator exists in both the public and private sectors, as well as in autonomous public enterprises. Mediators' responsibilities and the extent of their intervention vary from case to case, but they are all independent authorities, whose powers differ from those of government departments or the courts. Their task is to seek an out-of-court settlement between the parties, but also to provide them with information, undertake inquiries and draw up recommendations. There are two federal mediators, a French-speaking and a Dutch-speaking one, who work together and whose duties are similar to those of the ombudsman (see below).
166. In Estonia, mediation is confined to the field of compulsory purchase: the governor of the county in which the relevant property is situated may call on the parties to the proceedings to agree on the level of financial compensation within a maximum period of two weeks.
167. Lithuania, in contrast, offers one of the few examples of a general system for the extra-judicial settlement of administrative disputes. The system, established very recently, allows complainants – except in a few cases – to choose at the outset whether to pursue the judicial or the out-of-court method of settling their case. However, even if they opt for the latter, they always retain the right of appeal to an administrative court once the extra-judicial proceedings have ended.
168. There are two
types of out-of-court settlement: a special system that exists in several
branches, resembling ones in other countries, and a general system. The latter comprises three tiers of
administrative disputes committees. The
first tier, at the municipal level, does not yet exist because the
establishment of local committees is optional.
However, the district and national committees are in permanent
session. They have been established by
the government for a four-year period and comprise five legal members.
169. The committees, between which there is no hierarchical relationship, have power to consider individual administrative decisions and the authorities' refusal to implement certain decisions or delays in so doing. The law specifies certain disputes which are outside their jurisdiction – such as those relating to the legality of administrative rule-making decisions - as well as cases in which these committees must be consulted before there can be a reference to the courts.
170. Committees are empowered to order departments to carry out decisions or end violations within a specified time, but implementation depends on the good will of the authorities concerned. Where a committee's decision or its implementation is in dispute the case comes before the courts.
171. The system is very recent and it is therefore too early to establish a complete picture of its strengths and weaknesses, but one advantage is that it offers a locally based service in a country with just seven administrative courts.
172. Finally, in Romania, although conciliation and mediation are not yet used in the administrative field the latter could shortly be introduced. Draft outline legislation on settling disputes by mediation is currently being drawn up. The bill, which would cover civil, criminal and administrative cases, would include special provisions concerning mediation between administrative authorities and private persons.
4. Settlements
173. According to the conclusions of the Lisbon conference, a settlement is a contract in which the parties end their dispute by agreeing to reciprocal concessions. As such, it is often the culmination of a conciliation or mediation process and serves as much as a means of preventing as of resolving administrative disputes. However, it is referred to here because certain countries' legislation or case-law explicitly authorises government departments to conclude such settlements, examples being Belgium, Portugal, Spain and Switzerland.
174. One good example is provided by Spain, where Act 30/1992 on the legal arrangements governing public authorities and administrative procedure authorises government departments to conclude informal and formal agreements, contracts and settlements with private or public persons, on condition that they are not incompatible with public order, do not concern subjects for which settlements are not suitable and are in the public interest.
5. Ombudsmen
175. The ombudsman is an institution that exists under various titles in many European countries, including Andorra, Belgium, Croatia, Czech Republic, Finland, Hungary, Iceland, Malta, Moldova, Norway, Poland, Portugal, Romania, Slovenia and the United Kingdom. Generally, the ombudsman is not, properly speaking, a conciliation or mediation body, but since his task is to protect citizens and oversee the authorities' activities, he may on occasions act as a mediator to prevent or resolve disputes between public administration and individuals without the need to bring them before the courts.
176. In Andorra, the Raonador del Ciutadá was instituted in 1998. This is a kind of mediator, whose mission is among others to oversee that the actions of public authorities, in general and in the broadest meaning of the word, serve objectively the general interest and respect the principles of hierarchy, efficiency, transparency and full respect of the Constitution and the rest of legal order. The resolutions adopted by the Raonador del Ciutadá in the course of his functions are not binding.
177. In Belgium, as mentioned above, two federal mediators exist, one French-speaking and one Flemish-speaking. They operate as a panel. They are appointed by Parliament for a renewable six-year term, and they have three distinct functions:
- to examine claims concerning the functioning of federal administrative authorities; in this context, the federal mediators carry out a mission of mediation in the strict sense, as they try to reconcile the positions of the complainant and the authority complained of;
- to investigate the functioning of federal administrative authorities at the request of the Parliament;
- to make recommendations and report on the functioning of federal administrative authorities.
178. There are no formalities or fees for submission of complaints to the mediators. Lodging a complaint with them is not a compulsory preliminary to taking legal action, but it is a general option. On the other hand, a non-contentious procedure and a contentious one may not be initiated at the same time as the Act of 22 March 1995 setting up the mediators states that examination of a complaint must be suspended if the case becomes the subject of a legal claim or a formal administrative appeal. The possibility of lodging a complaint with the mediators is re-established if the court case is dismissed or dropped, or following the conclusion of the contentious procedure. Mediators may also consider complaints concerning official decisions which have become final following expiry of the period fixed for appeal against them, and may intervene if problems arise concerning enforcement of court decisions.
179. At the same time, referral of a case to the mediator does not suspend or interrupt the time-limits for taking legal action or lodging a formal administrative appeal, therefore complainants must choose between the contentious and the non-contentious proceedings. The federal mediators regret this situation, which deprives mediation of some of its utility.
180. As far as the Czech Republic is concerned, the Act that institutes the parliamentary Ombudsman was adopted at the end of 1999, and the first Ombudsman will be elected in 2000.
181. In Finland, there are two institutions having similar competence: the Parliamentary Ombudsman and the Chancellor of Justice. The former, that was established in 1920. He is appointed by the Parliament for a four year-term at a time and has two Deputy Ombudsmen. He oversees that the courts of law, the other authorities and the officials, public employees and other persons, when performing a public duty, comply with the law and fulfil their duties. The Ombudsman also monitors the realisation of basic rights and human rights.
182. The office of the Chancellor of Justice of the Government was established in 1919, albeit the tradition of the office dates back to 1713. The Chancellor of Justice is appointed by the President of the Republic for an indefinite term. A Deputy Chancellor of Justice is appointed in the same manner, while an alternate of the Deputy Chancellor of Justice is appointed for a term of five years. According to the Constitution, the duties of the Chancellor of Justice correspond to those of the Ombudsman. In addition, the Chancellor of Justice has the special task of overseeing the Government and acting as its legal advisor.
183. The Ombudsman and the Chancellor of Justice have somewhat overlapping jurisdictions, especially as regards the oversight of the authorities. According to the division of duties, laid down by an Act of Parliament, the Ombudsman has jurisdiction over matters pertaining to the armed forces, the border guards, the peace-keeping personnel, military court proceedings, prisons and certain other institutions. Both supervise the legality of public administration acts and deal with citizens' complaints relating thereto. A citizen can address the complaint to either of the two.
184. Finland has also numerous special ombudsmen and commissioners, such as the Consumer Ombudsman or the Equality Ombudsman.
185. The duties of these special ombudsmen include not only the consideration of individual cases within their respective jurisdictions, but also the provision of advice, guidance, and information on, and the promotion of, the pertinent legislation and the rights and obligations laid down therein. Furthermore, the ombudsmen monitor the development of the legislation and the society as regards their sectors of competence. Some of the ombudsmen also appear as counsel in court proceedings.
186. Except for the Consumer Ombudsman, the competence of the special ombudsmen is often limited to the promotion of the objectives of the legislation in their sectors by advice, guidance, recommendations and opinions. The judicious use of publicity plays a role in this connection as well. When dealing with individual cases, the special ombudsmen usually do not make binding decisions; instead, their decisions take the form of recommendations. Moreover, the special ombudsmen, unlike the Parliamentary Ombudsman, do not have the competence to order any charges to be brought.
187. In Hungary, a Parliamentary Commissioner for Citizens' Rights or Ombudsman was established in 1995. It is his duty to investigate any abuse of constitutional rights that comes to his attention, and to initiate general or particular measures for redress. The Parliamentary Commissioner acts as a mediator between the administrative authorities and their clients. Although he cannot annul administrative decisions, he has a number of possibilities for redress: he has wide-ranging investigative powers, may initiate the withdrawal or modification of the contested administrative action, may turn to the superior administrative agency to instruct its subordinate unit to make redress and may initiate any kind of legal action taken by other public authorities, for example, initiate proceedings before the Constitutional Court or the Public Prosecutor.
188. Moreover, a law of 1993 established two other commissioners with specific jurisdiction. They are responsible for the protection of personal data and national and ethnic minority rights.
189. In Iceland, the Ombudsmen receives citizens' complaints on decisions of the State and municipal administrative authorities. He provides advice on each case and gives recommendations to the competent authorities with a view to rectifying or improving their decisions, if he considers that citizen's rights and freedoms have been violated.
190. The Ombudsmen of Norway, Romania and Slovenia, as well as the Portuguese Provedor de Justiça, have similar functions.
191. In Moldova, there are three Parliamentary Ombudsmen who are appointed by Parliament for a five-year term. Their mission is to monitor the respect of constitutional rights and freedoms by central and local administrative authorities, entities, organs and firms, either publicly or privately owned, as well as all persons occupying higher posts. Acts and decisions of Parliament, of the President of the Republic and of the Government, criminal offences, administrative sanctions and labour law are excluded from their field of competence.
192. In the United Kingdom, the first Ombudsman, the Parliamentary Commissioner for Administration (PCA), was introduced in 1967. The remit of the PCA was to investigate allegations of maladministration in central government. Unlike others models from which the concept was developed, in particular those from Scandinavian countries, British citizens did not have (and still do not have) a right of direct access to the PCA. Rather they must first make a complaint to a Member of Parliament, and that Member must then refer the complaint to the PCA for investigation. Nor did the PCA have power to order any particular measure of redress for the citizen, if allegations of maladministration were proved. Rather the PCA could recommend appropriate remedies, and rely on adverse publicity should the department in question fail to comply with the recommendation. Since those early days, the Ombudsman concept has been considerably extended. There are now Ombudsmen in many specific areas of public policy, such as the National Health Service, local government or tax matters.
ALTERNATIVE JUDICIAL PROCEDURES FOR SETTLING ADMINISTRATIVE DISPUTES
1. Tribunals in common law countries
193. Before dealing with the principal and best known alternative judicial procedure for settling administrative disputes – arbitration -, the particular situation of common law countries, and in particular of the United Kingdom, ought to be mentioned. In this country there is a great variety of institutions of “administrative justice” in which disputes between the citizen and the state are resolved. These institutions, called “tribunals“, are independent judicial bodies which operate following the same general principle as ordinary courts and replace them. They can be found in various areas, such as social benefits, employment or immigration and their dominant features compared to those of ordinary courts are a simpler and more flexible procedure and a less expensive resolution of disputes.
194. It should be added here that in the United Kingdom, the continuing growth of alternative dispute resolution means and the introduction in 1999 of new civil procedure rules which place a duty upon the courts to encourage the use of alternative dispute resolution means has prompted the government to develop a strategy towards these alternative means generally and, in particular, for the interaction between those means and the courts. The basic tools for achieving this are a discussion paper and pilot schemes.
195. The discussion paper aimed to identify reasons why the use of alternative dispute resolution means has remained low even where free schemes are available, and how its use can be encouraged by the government. It also sought to identify the types of alternative means in use and the type of cases where their use is appropriate.
196. The Lord Chancellor has agreed in principle to pilot schemes being set up to test out some of the policy issues. Finally, in May 2000, he commissioned a wide-ranging independent review of tribunals in England and Wales. The results of this review should be known by March 2001.
2. Arbitration
197. With the exception of common law countries, the only alternative judicial procedure known in the vast majority of member States is arbitration.
198. According to the conclusions of the Lisbon conference, arbitration is a judicial procedure in which the settlement of disputes is the responsibility of specially appointed private judges, who hand down a formal decision that constitutes res judicata.
199. It should be noted here that in Poland, arbitration is carried out by a special state court and that consequently, arbitration as it is envisaged in the above-mentioned definition does not exist. 200. Arbitration is only rarely used in disputes between government departments and private individuals. Some countries' legislation explicitly excludes it from this type of dispute. In Belgium, for example, article 1676-2 of the Civil Code prohibits public law corporations from resorting to arbitration, except where this is authorised by an international treaty or by specific legislation. The same applies in Finland, where the Arbitration Act (967/1992) confines this procedure to private law disputes.
201. In the Czech Republic, arbitration is so far only used in the field of private law. Nevertheless, the reform of the public administration reform is currently under way and new laws are regulating the organisation of local and regional public administration, administrative procedure and the development of administrative justice. The principle of friendly settlement has been introduced in the draft of the new code of administrative procedure. The introduction of an obligatory friendly settlement and arbitration procedure in the new act on physical planning and construction law, in order to settle disputes concerning land use, has been suggested.
202. In Iceland, arbitration does not exist. However, the parties may sign an arbitration clause. The administrative authorities have not established any detailed directives about contractual arbitration provisions.
203. In certain countries, arbitration is authorised in specific cases. In Estonia, there are appeals committees set up under special acts in various sectors, such as that of industrial property. The industrial property appeals board operates under the auspices of the Ministry of Economic Affairs and hears appeals against decisions of the patents office. The board, to which applications are submitted in writing, can reject or set aside patents office decisions and ask it to reconsider patent applications. It must issue its decision within three months of receiving the appeal and its decision is subject to a further appeal to the courts.
204. Italy has an arbitration board in the public works field, which is a proper judicial authority substituting for the courts, which have no jurisdiction in this area.
205. In Portugal, the state and other public law corporations may conclude arbitration agreements if this is authorised under specific legislation or the dispute concerns private law relationships. The Code of Administrative Procedure also allows administrative contracts to include an arbitration clause. Under these provisions, several categories of administrative dispute are liable to arbitration, such as ones concerning public works contracts. A striking illustration is provided by legislative-decree 237/93, which created an arbitration court to rule on applications for compensation from haemophiliacs contaminated with the AIDS virus after undergoing transfusions in public hospitals. The legislative-decree obliged the state to accept recourse to this court, whenever applicants preferred this method of settling disputes to the ordinary courts.
206. Portugal is currently drawing up draft legislation on administrative disputes, under which arbitration will be an accepted means of settling disputes relating to administrative contracts, the liability of public authorities, and certain issues relating to the civil service.
207. The situation in Greece is similar to that in Portugal one: arbitration is a valid means of solving litigation in administrative matters if it is authorised under specific legislation or if an arbitration clause is included in the contract, provided these clauses are authorised by law. The arbitration court may decide upon questions of facts and law brought before it, and even order the administrative authority to pay a sum of money, but it cannot annul or modify an individual administrative act.
208. In Switzerland, arbitration proceedings are authorised in certain very specific cases, such as compulsory purchase.
209. In Turkey, disputes arising from public service sub-contracting arrangements may be submitted to national or international arbitration. An arbitration code is currently being drawn up which will lay down the basic principles governing this approach.
210. Georgia, Romania and the Russian Federation are slightly special cases, in that arbitration is authorised under their codes of civil procedure. In Georgia and Romania, these codes also apply to administrative disputes, thus enabling the parties to opt for arbitration as a means of settling the issue. However, Romanian legislation does restrict this principle to some extent by laying down a list of subjects for which arbitration cannot be used.
211. In the Russian Federation, the Arbitration Act, incorporated in the civil procedure code, provides that citizens may bring any litigation before an arbitration court, with the exception of conflicts relating to family matters or employment. Arbitration courts are set up by a formal written agreement drafted by the parties. The constitutional law on arbitration of 28 April 1995 states that the arbitration court decides on economic conflicts and other cases within its competence.
CONCLUSION
212. This study, which shows the diversity of alternatives to litigation in administrative matters that exists within member States and the different ways in which they are dealt with in national legislation, nevertheless brings out some common trends.
213. First of all, in most countries, the public administration makes a broad use of traditional alternative methods to prevent litigation or settle the matters outside the courts. Means for prevention, such as hearings, consultation and negotiation, exist in many areas where administrative acts or decisions can affect the rights and interests of private parties and enable them to be associated in the decision-making process; this can prevent some disputes. Internal administrative reviews, which may be used when there is already a dispute, play an important part in Member States' practice, as they enable a more rapid and less costly resolution of many disputes outside the court system.
214. Together with these traditional alternative means, the Ombudsman also plays a very important part. In contrast to the courts, this institution enables appraisal of the opportunity of the administrative authorities' action. The Ombudsman enjoys substantial moral authority and the success of this institution is demonstrated by the creation of specialised Ombudsmen in many countries.
215. In contrast to these traditional alternative means, conciliation, mediation, compromise settlement and arbitration, even if they have been developed in some countries during recent decades, are not very common in litigation between administrative authorities and private parties. Even when such alternative means do exist, their use is rather limited, although there are some exceptions. This relative marginality is reflected in the very diversified ways in which these means are dealt with in member States' legal systems.
216. Considering the existing situation in member States and the advantages of these alternative means, the Council of Europe's reflection on the development and encouragement of the use of these means is very useful, as they can complement the role of the courts, which remains of course essential. [1] Questionnaire on alternatives to litigation in administrative law:
1. In your country, are there any means of preventing litigation between the State and private parties (such as negotiation)? If so, please provide details.
2. In your country, are there any non-judicial means of settling administrative disputes (such as internal review, conciliation or mediation)? If so, please provide details.
3. In your country, are there any judicial means of settling administrative disputes (such as arbitration)? If so, please provide details. 4. In your country, are there any current or foreseen reforms concerning alternatives to litigation in administrative law? If so, please provide details. |
