Declaration of invalidity of a decision on building permit due to lapse of time
Amendment to the Construction Law
REal Knowledge –about the Polish real estate market 2/2021
The Act of 13 February 2020 amending the Construction Law introduced Art. 37b (similar to Art. 59h of the Construction Law with respect to use permit), which in overall was intended to provide an abolition for owners of premises constructed under invalid building permits.
Authors: Michał Cwajna, Jagoda Dubielecka
According to the above provision, a building permit shall not be declared invalid if 5 years have passed from the date of its delivery or announcement. By this, the legislator showed understanding towards investors who (often without their awareness) could be faced in future with invalidation of the building permit. Article 59h contains a similar regulation, indicating that the use permit shall not be declared invalid if 5 years have passed from the date on which the occupancy permit became final.
The above amendments regulated the issue regarding declaration of invalidity of administrative decision – being a legal form of issuance of building permit (occupancy permit). As of the day the amended act came into force - such regulation will certainly give comfort to investors and users of properties. However, there has been an interpretation issues concerning how the above provision should be used in practice and whether they may be applied to decisions issued prior to entry of the above act into force.
The background of the change is the judgment of the Constitutional Tribunal of 21.05.2015, ref. P 46/13 (Journal of Laws 2015.0.702), where the Tribunal declared that the Article 156 § 2 of the Code of Administrative Procedure is incompatible with Article 2 of the Constitution of the Republic of Poland to the extent that it does not exclude the possibility of claiming the invalidity of a decision issued in gross violation of the law, when there has been a significant lapse of time since the issuance of the decision and the decision was the grounds for the acquisition of a specific rights. The Tribunal stressed out the importance of the principle of durability of an administrative decision. It has noted that the rule of law principal does not justify the possibility to declare the administrative decisions invalid if the decision for several decades was subject to a presumption of it being in line with the law and has the effect of acquiring a right by its addressees.
The view of the Constitutional Tribunal was shared by subsequent ruling including the Supreme Administrative Court. For example, the ruling of the Supreme Administrative Court of 20 February 2019, II OSK 694/17, in which the court indicated that activity of state authorities in line with the law does not implicate an absolute option to eliminate defective decisions, based on which a party acquired a right, after a considerable time has passed. It should be noted that the judgments were issued considering the Tribunal’s favorable interpretation before the amended regulations occurred.
Uncertainty has arisen in connection with the ruling Supreme Administrative Court of 16 December 2020; II OSK 2658/18), in which the court indicated that from the interim norms contained in Articles 25-33 of the Act of 13 February 2020 amending the Construction Law, there is no grounds to claim that the new provision should apply to finalized administrative cases or to administrative court proceedings concerning such cases. In our opinion, however, this ruling cannot be interpreted only within the main thesis, but rather based on the factual circumstances of the specific case. It should be pointed out the court case before the Supreme Administrative Court concerned how the amendment of law should be understood, but only as incidental matter not the main subject of the ruling. Moreover, the proceedings concluded by the above ruling concerned a building permit issued in 2014, and the issue of its invalidity was finally resolved by a decision of a higher-level authority in 2017. Consequently, the proceedings for declaration of invalidity were initiated and concluded before the amendment came into force. In our view the provision of Article 37b of the Construction Law should also be applied to cases completed with the building permit issued before September 19, 2020, where the invalidity proceedings were not initiated before that date. Article 59h of the Construction Law should be interpreted in similar manner with respect to occupancy permits issued.
Therefore, despite the initially unfavorable thesis of the abovementioned decision of the Supreme Administrative Court, in our view, the provisions of the amendment to the Construction Law should still be interpreted in a way that it covers the decisions issued before the amendment, however considering the lapse of the 5-year period after which a given decision shall not be declared invalid.
Therefore, it should be assumed that, as of the day of the amendment is coming into force, cases completed with the issuance of a certain permit and in relation to which no proceedings for declaration of invalidity have been initiated (subject to the expiry of the 5-year period) may only be subject to a statement that the authority issued such decision in violation of the law, as well as indication why the declaration of invalidity was not possible. In such a case, the key administrative decisions in the construction process should remain in force.