Minor disputes: the draft law was adopted, but with a reservation

When reviewing the criteria for minor disputes proposed by MPs pursuant to the decision of the Constitutional Court, the Verkhovna Rada will take into account the need to amend the procedure for appeal and cassation review, as well as take into account the proposals made by the Supreme Court.

The Parliament adopted as a basis the draft Law No. 11026 dated 19.02.2024 «On Amendments to the Civil Procedure Code of Ukraine and the Code of Administrative Procedure of Ukraine on Guaranteeing the Right to Judicial Protection in Minor Disputes», rejecting the other alternative ways to solve the problem.

The current amount of the claim price (as a criterion for classifying a case as minor) is significantly higher than the subsistence minimum and minimum wage and does not correspond to the understanding of the case and the dispute in it as minor. The Constitutional Court drew attention to this last fall (see Decision No. 10-r(II)/2023). In this regard, several draft laws appeared in the Parliament.

Today, for the purposes of the Code of Civil Procedure, minor cases are considered to be:

• cases in which the amount in controversy does not exceed one hundred times the minimum subsistence level for able-bodied persons;
• cases of minor complexity recognized by the court as insignificant (except for cases subject to consideration only under the rules of general action proceedings and cases where the amount in controversy exceeds two hundred and fifty minimum subsistence levels for able-bodied persons).
• consumer protection cases, where the amount in controversy does not exceed two hundred and fifty times the minimum subsistence level for able-bodied persons.

Taking into account the conclusions of the Constitutional Court, the authors of the legislative initiative propose to replace the mentioned prices of the claim in Part 6 of Article 19 of the Code of Civil Procedure with fifteen (instead of one hundred) and thirty (instead of two hundred and fifty) minimums, respectively. In addition, according to the MPs, cases arising from labor relations should not be considered in the simplified lawsuit procedure (Article 274 of the Civil Procedure Code).

Similar amendments are proposed to Article 12 of the Code of Administrative Procedure. Thus, if the law is adopted in the wording of its draft, an appeal against a decision of a public authority on the basis of which it may claim to recover funds in an amount not exceeding fifteen (currently one hundred) times the subsistence minimum for able-bodied persons will be considered insignificant.

According to the legislators, such regulations will guarantee citizens the right to judicial protection in minor disputes.

On May 23, the Verkhovna Rada adopted such a draft law as a basis, but with a reservation to finalize its provisions in accordance with Part 1 of Article 116 of the Rules of Procedure of the Verkhovna Rada:

«Proposals and amendments to the draft law being prepared for the second reading may be made only to the text of the draft law (sections, chapters, articles, their parts, clauses, subclauses, paragraphs, sentences) that was adopted by the Verkhovna Rada as a basis. The Main Committee, as an exception, may decide to take into account the proposals and amendments submitted to correct, clarify, eliminate errors and/or contradictions in the text of the draft law, other structural parts of the draft law and/or other legislative acts that were not considered in the first reading, if the need for their introduction was stated in the conclusions of this Main Committee and/or the expert unit of the Verkhovna Rada Secretariat and announced by the chairman of the plenary session during the consideration of such a draft law in the first reading. Such proposals and amendments must be in line with the subject matter of the legal regulation of the draft law».

MPs insisted on the need to apply this rule during the discussion of the document in the Verkhovna Rada Committee on Legal Policy. They noted that «there is a need to amend the procedure for appeal and cassation review, as well as to take into account the proposals made by the Supreme Court».

The Supreme Court assessed the proposed amounts of the subsistence minimum for determining the insignificance of a dispute as adequate and solving the problem stated by the Constitutional Court, while not leveling the institution of minor cases.

In addition, the SC drew attention to the following points:

1) amendments to the Civil Procedural Code regarding the grounds for consideration of cases in the simplified action procedure, in particular, to reduce the amount of the claim, at which cases of minor complexity may be recognized by the court as insignificant. According to the judges, it is inappropriate to make the proposed changes and reduce this criterion. Instead, it is advisable to leave the provisions on the limits of judicial discretion in the current version.

2) Exclusion of clause 5 of part 6 of Article 19 of the Code of Civil Procedure, which provides that consumer protection cases are insignificant if the amount in controversy does not exceed two hundred and fifty times the minimum subsistence level for able-bodied persons. This will significantly reduce the monetary criterion (the «threshold») for classifying consumer protection cases as minor cases. We support these proposals, as consumer protection cases are quite complex in law enforcement.

As a reminder, according to Art. 131-2 of the Constitution, only lawyers can represent individuals in court. However, the law may provide for exceptions, including for minor disputes.

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