With effect from 15 March 2020, the Government has ordered an extraordinary judicial vacation in respect of the Covid-19 epidemic. At first glance, it may mean the closure of the courts, like of other institutions. Is that really the case though?

The point of the judicial vacation is that during this time, as a principle, the court does not hold hearings and the deadlines do not expire. At the same time, it is important that the parties can continue to make statements in litigation, for instance, they can voluntarily fulfill their obligations within the original deadline, submit pleadings and these actions will not be invalid, and will be assessed by the court.

However, the provisions regarding the judicial vacation are distinct in the previous and new codes on civil procedures. This means that this measure may affect litigation that started before 2018 and is pending under the previous code and those initiated in or after 2018 and regulated by the new code differently.

A judicial vacation does not apply to all kinds of judicial proceedings under either the previous or under the new rules. Both under the old and new rules of civil procedure expedited proceedings are exempt from the judicial vacation rules, including cases pending under the old rules with an amount of dispute in excess of HUF 400 million. Similarly, both under the previous and the new civil procedural rules the parties may jointly request that the rules of the judicial vacation be waived. Further exceptions to the rules of judicial vacation under the previous code include, for instance, enforcement litigation and non-contentious procedures.

Importantly, rules specifying deadlines for bringing a certain claim are not regarded as procedural rules, and therefore, rules of judicial vacation do not apply to them at all. Accordingly, one cannot wait until the end of the judicial vacation with challenging an administrative decision, bringing a labour claim or challenging a publication in the press.

With these exceptions, to the best of our knowledge, it cannot be stated that the courts will close. To our understanding, some cases will continue to be proceeded and deadlines set for the parties will continue to lapse. What can happen in cases that are not covered by a judicial vacation? What happens e.g. if the parties make a joint application not to apply the rules of the extraordinary judicial vacation? Will the court be required to act and schedule and hold a hearing in this case?

According to the information provided by the National Judicial Office, courts generally do not hold hearings, urgent procedural acts are conducted by remote hearing or, if this is not possible, a special courtroom protocol will be put in place: parties must be 2 meters away from each other and from the judges, those parties present are asked whether they have been in the infected area or have had contact with an infected person during the last two weeks. If it is likely that an infected person is present in the courtroom, the court may interrupt the proceedings and isolate the person concerned. In addition, face-to-face client service is completely suspended in courts and the parties will receive information via telecommunication means. Further information and details are expected in the following days.

Moreover, the court may decide in pending cases to apply the rules of interruption of procedures on the basis of an unavoidable event impeding the operation of the court, although this is likely to be the subject of prior consultation within the judicial bodies (e.g. if there is a chance that an infected person is in the courtroom). Interruption of proceedings and termination of interruption of proceedings is ordered by the court by formal orders, and appeal is available against the order on interruption. In the event of an interruption of the proceedings, the court will not hold a hearing, the deadlines will be interrupted and will upon the continuation of the proceedings. During the interruption, the parties may only make a statement regarding the interruption, and all other submissions must be disregarded by the court.

What if the procedure is not interrupted but the party is unable to meet a certain deadline due to the epidemic or someone is unable to fulfill their obligation e.g. the foreign party or witness cannot appear in court due to travel restrictions? In this case, requesting an extension of the deadline before its expiration is recommended. However, even failing to comply with a deadline shall not constitute an omission on the part of a party if that party was prevented by an unavoidable obstacle, which obviously should be notified as promptly as possible. If this is not the case, the party may still apply for equitable treatment of the omission. In this case, it is essential that the omission should be rectified immediately along with the request. It shall be noted that in the case of legal entities (companies) and parties having legal representatives, such requests are subject to a fairly rigorous consideration.

What if a party or their representative is capable of attending a hearing or other procedural act but they do not dare due to the fear of the epidemic? In this case, in accordance with the strict interpretation of the rules, it may be deemed an omission. However, it is conceivable that, in the current situation, the court would assess such a circumstance more equitably. However, such an excuse shall not emerge in the case of hearings held by telecommunication means, of course.

Extraordinary judicial vacation and the possible interruption of proceedings shall extend the duration of the proceedings for an indeterminate period. In this context, however, due to the known circumstances, it will hardly be possible to invoke the excessive length of the proceedings and the infringement of the right to a fair trial.

The measures taken by the main arbitral body in Hungary, the Permanent Arbitration Court attached to the Hungarian Chamber of Commerce and Industry (also known as the Commercial Arbitration Court) are slightly different. For now, no hearings will be held until April, and hearings scheduled for March will be postponed. However, the parties are required to comply with the deadlines, and no "arbitral vacation" will take place. Arbitration fora also have a wider discretion as to procedure, and can therefore adapt more flexibly to the situation, e.g. by extensive use of videoconferencing technologies and the possibility of deciding a case outside of a hearing.

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