The new Law on Forensic Experts entered into force on 15 March 2016. The foundation on which this new law was drafted was the current regulation in force since 1 July 2007. The new law introduces changes to requirements for forensic expert candidates, certification procedures, a responsibility of forensic experts and other significant changes.

In accordance with the most current court practice, the Supreme Court’s Department of Civil Cases has assessed a number of significant legal issues and has provided rulings on the competency of Land Register judges and the necessity to assess the validity of transactions, the legal status of cost for a lawyer’s legal assistance, the applicability of Council Regulation No 44/2001 in relation to the fulfilment of rulings which have in substance been adjudicated by an arbitration court, the legal basis of collecting lawful interest until the implementation of a court judgement, as well as the boundaries of exercising ownership rights.

1. The new law on forensic experts has been adopted

Civil cases may require examination of important facts requiring specialist knowledge in science, technology, art or another field. To this end the parties can invite specialists to examine and assess the circumstances of the case, however even if they are heard in court the assessments of such persons may not be sufficiently complete, objective or comprehensive. Therefore, either of the parties has the right to ask the court to invite forensic experts in accordance with the procedures of the Civil Procedure Law. In this case, the Law on Forensic Experts must also be observed.

The new Law on Forensic Experts stipulates persons with the right to provide forensic expertise and also stipulates concrete situations in which persons who are not state forensic experts may not provide forensic expertise. The requirements for forensic expert candidates have been clarified, for example having a flawless reputation, thereby restricting the rights to provide forensic expertise of persons who have committed serious infringements of normative acts. The range of persons who may not be forensic expert candidates has been expanded, certification and recertification rules have been supplemented and state forensic experts are now prohibited from simultaneously working as private forensic experts. The new provisions also clarify the legal basis for the Register of Forensic Experts, including stipulating that it will contain information on the suspension of a forensic expert’s right to work, as well as information about forensic experts’ competency. The Register of Forensic Experts and any amendments therein shall be published on the website of the Courts Administration.

The new law is also supplemented with regulations on expert forensic methods, a definition of what expert forensic methods are, anticipating what the description of this method entails, as well as the procedure for its approval and registration by the Council of Forensic Experts. The law also stipulates the obligation to regularly calibrate and verify equipment and instruments used for expert forensic methods.

The new law also expands regulations on the disciplinary liability of forensic experts. In other words, Section V of the Law on Forensic Experts “Liability of Forensic Experts” expands the list of grounds for initiating disciplinary action, stipulating that disciplinary action shall be taken against forensic experts for gross negligence while performing forensic examination, losing or maliciously damaging an object submitted for forensic evaluation, as well as disclosure of information obtained during expert examination to persons not connected with determining or performing the expert examination.

Therefore, the new Law on Forensic Experts is aimed at improving regulation of expert forensic work and ensuring qualitative expertise, which may, in turn, give a higher degree of trust in the expert’s work and assist in establishing the truth in civil cases. Setting stricter requirement for experts and improving regulation of liability also indicate that legislators want to improve current practice and the applicable legal provisions.

2. Court practice and jurisdiction

2.1. The obligation of Land Register judges to check the validity of transactions

The 11 April 2016 ruling of the Supreme Court’s Department of Civil Cases in Case No SKC-1314/2016 has evaluated the competency of Land Register judges to rule on the compliance of transactions with the Commercial Law and their validity in the event that a confirmation request has been submitted to a branch of the Land Register, with which a company as the owner of the immovable property wishes to establish a mortgage to the benefit of a member of the company’s board.

It arises from the aforementioned Supreme Court ruling that Land Register judges must gain certainty of the veracity of the rights to be confirmed and their complete establishment, and also when checking documents attached to a confirmation request they must gain certainty that they form the basis for the rights to be confirmed. Upon finding that a transaction which forms the basis of confirming mortgage rights has been concluded between a capital company and a member of its board, Land Register judges are obliged to ascertain whether the special legal provisions under the Commercial Law set any restrictions.

Of significance in this case was the fact that pursuant to Article 139.5³ of the Commercial Law a transaction between a company and a board member or council member only enters into force after this transaction has been approved by the council or shareholders’ meeting. In other words, the validity of such a transaction depends on approval by the shareholders’ meeting, and the legal ramifications for the enactment of which the transaction was concluded only enter into force after approval by the shareholders’ meeting. In the event that the submitter of a confirmation request has not submitted confirmation of the transaction from the company shareholders’ meeting to the Land Register judge, it shall be concluded that the right to be confirmed is justified on the basis of a transaction which has not entered into force. The obligation of Land Register judges to check the validity of transactions in such cases is also stipulated under Article 139.5³ of the Commercial Law which has the objective of preventing conflicts of interest in companies and capital companies and possible conflicts of interest between board members. It can be concluded from the aforementioned that in order for Land Register judges to be able to decide that a transaction is valid and the right established on this basis should be confirmed in the Land Register, additional documents confirming the validity of the transaction may have to be attached to the confirmation request.

In connection with the 11 April 2016 ruling of the Supreme Court’s Department of Civil Cases, the dissenting opinion of Supreme Court Justice V.Jonikāns has also been presented, in which it is stated that contrary to the aforementioned Article 61.3 of the Land Register Law obliges Land Register judges only to check Land Register registers to establish whether a confirmation request has been submitted by a lawful person. It is outside the competency of Land Register judges to obtain additional information to draw conclusions regarding the validity of a transaction. Under the Land Register Law, Land Register judges do not have the right to obtain and evaluate the evidence regarding the substance of a transaction.

2.2. Council Regulation No 44/2001 is not applicable in cases regarding the implementation of rulings by foreign courts which have substantially been examined by arbitration courts

On 16 March 2016, the Supreme Court’s Department of Civil Cases ruled in Case No SKC-1196/2016, which examined the recognition of a Lithuanian appeals court ruling and the ordering of its implementation in Latvia. This ruling highlights a number of significant aspects of applying international law regarding the recognition and implementation of rulings.

In the said ruling the Supreme Court emphasised that Section 77 of the Civil Procedure Law “Recognition of Foreign Court Rulings” only applies to recognition and fulfilment of foreign court rulings if the respective procedural issue is not regulated by an international agreement or regulation which is binding on Latvia and applicable in the respective case. In other words, if the recognition and implementation of a foreign court ruling is regulated by an international agreement or regulation, the said provisions of the Civil Procedure Law are applicable in subsidiarity insofar as they are required for the effective application of the international agreement or regulation in Latvia.

The ruling also emphasises that Council Regulation No 44/2001 and European Parliament and Council Regulation No 1215/2012, substituting the former from 10 January 2015 excludes regulation of international agreements and conventions concluded between European Union Member States covering mutual recognition of rulings and implementation in civil and commercial cases, including amongst others the application of the 11 November 1992 Agreement on Legal Assistance and Legal Relations between the Republic of Latvia, the Republic of Estonia and the Republic of Lithuania.

In the ruling the Supreme Court also made reference to the stipulation in the European Court’s judicature that if the ruling to be recognised has not been made in a civil case or a commercial case or if the exclusion of the application of this regulation under Council Regulation No 44/2001 Article 1 is applicable, the said regulation cannot be applied. Thus the Supreme Court’s Department of Civil Cases concluded that since matters pertaining to arbitration court proceedings are excluded from the areas of application of the said regulation, therefore Council Regulation No 44/2001 cannot be applied to recognition and implementation of foreign court rulings regarding the securing of funds under the auspices of arbitration court proceedings.

2.3. Payment of costs for a lawyer’s assistance are not included in the claim amount and state duty is not payable when requesting this be compensated

The Supreme Court’s Department of Civil Cases ruling of 22 February 2016 in Case No SKC-1073/2016 finds that state duty shall not be payable on the collection of legal costs from the opposing party.

The court indicated in the said ruling that costs for a lawyer’s assistance as one form of legal costs are not considered to be part of the claim amount under Article 35 of the Civil Procedure Law. Pursuant to Article 34.1 of the Civil Procedure Law, state duty is payable for submitting an application for claims or another application stipulated in the said article, while legal costs are not considered part of the claim amount. This means that the Civil Procedure Law only imposes the obligation to pay state duty in cases specified in the law, and in addition state duty is not payable when applying for the collection of legal costs from the other party.

The aforementioned relates to the consideration that compensation of costs to be compensated pursuant to Article 44 of the Civil Procedure Law, which also includes costs for a lawyer’s assistance, are particularly stipulated to compensate the party which wins the court judgement for costs incurred during the respective case.

It can be concluded from the ruling that legal costs shall also not be included in the claims amount in cases where the ruling of the court of the first instance is appealed and in addition to other claims made legal costs are also claimed.

2.4. Failure to voluntarily implement a court ruling may be grounds for calculating and collecting lawful interest

On 29 January 2016 the Supreme Court’s Department of Civil Cases ruled in Case No SKC-1331/2016, which examined aspects of explaining court rulings and the issue of collecting lawful interest up to the implementation of the court ruling. The ruling indicates that explanation of a judgement is intended to prevent confusion regarding the content of the judgement due to unclear or ambiguous formulation of the judgement. Explanation of a court judgement is linked to possible difficulties in its implementation if the resolution section is insufficiently clear.

In the concrete case, the court was asked to clarify the part of the Supreme Court’s Civil Cases Chamber’s ruling of 27 June 2013 ordering that the plaintiff be paid 6% per annum of the claimed but uncollected amount for the period until implementation of the ruling by the other party, indicating for what period the plaintiff has the right to receive lawful interest.

In regard to the collection of lawful interest, the Supreme Court ruled that with the entry into force of a ruling on collection of a monetary sum the ruling becomes the legal basis for the collection of interest, and the failure to voluntarily implement it causes a delay under Article 1759 of the Civil Law which provides grounds for payment of lawful interest. This is based on the fact that non-implementation of a ruling and retention of amounts due to another person is tantamount to use of another person’s capital after the payment deadline for the amount.

Regarding the aforementioned, it is important to differentiate between a situation where the obligation to pay interest is connected with an infringement of obligations set out in a claims application and a situation where this obligation arises due to a delay in implementing a judgement. To separate these situations, the purpose for which the said rights have been determined must be assessed i.e. to guarantee rights to lawful interest for the person in connection with an infringement of obligations stipulated in a claims application or in connection with delay by the debtor in paying an amount ordered in a ruling. The plaintiff shall attach an applications in line with the claim to the claim for claims for lawful interest connected with infringement of obligations, while the plaintiff’s rights stipulated in Article 195 of the Civil Procedure Law are determined by the court on the basis of the law. This procedure is established because the state has a duty to ensure that lawfully enacted judgements are implemented, and stipulating the plaintiff’s rights to collect interest in the judgement can help to achieve this aim. Therefore, in the latter case interest is payable in connection with a ruling on non-collection of a monetary amount rather than failure to fulfil the obligations forming the basis of the dispute per se.

2.5. Using the right to self-defence to protect property may result in the obligation to compensate the owner of the affected property

On 10 March 2016 the Supreme Court’s Department of Civil Cases ruled in Case No SKC-70/2016 to rescind and order retrial for a Riga District Court case in which compensation has been claimed after the defendant demolished an advertising stand belonging to the plaintiff which was located on the defendant’s property. The demolition was performed because the plaintiff did not appear to sign a rental agreement within 15 days of notification being sent.

Referring to Articles 1036, 1038 and 1039 of the Civil Law, which stipulates that an owner has complete control over its property and has the right to prevent others from affecting its property, the appeals court ruled that the land owner’s action in cutting up the advertising stand in connection with the plaintiff’s unjustified failure to appear and sign a land rental contract complied with the law. The appeals court also affirmed that failure to conclude a land rental contract could be the legal basis for destroying another person’s property to prevent infringement of ownership rights.

The Supreme Court ruled that the appeals court’s interpretation and application of the legal provisions in the judgement was not adequately argued. The Supreme Court indicated that pursuant to Article 1038 of the Civil Law an owner can manage and use its property as it sees fit, including using it in full, even if this causes losses for another person. However, an owners actions which could results in losses for another person are restricted by the principal of good faith stipulated in Article 1 of the Civil Law. Thus the provisions of Article 1038 of the Civil Law do not exclude the right of the victim to claim compensation from the owner if ownership rights have been protected through infringement of the principle of good faith and infringing the victim’s rights and lawful interests. Although a person’s property can be protected through the courts, there are situations where it is not possible to receive timely assistance from a court or another competent state or municipal institution to prevent infringement of property rights. Therefore, exceptionally, due to the presence of certain preconditions stipulated in the law, pursuant to Article 1040 of the Civil Law the owner has the right to exercise self-defence rights and protect its property using its own resources. However, it must be assessed in this case whether the owner of the affected property should be compensated for losses resulting from the said action.