In the practice of the construction projects, it happens that the building permit or the occupancy permit (even though formally legal and valid) includes formal incorrectness or irregularity which, although not having any impact on the use of the facility, creates the theoretical risk of invalidation of a building or occupancy permit, and until now this risk has hardly been limited in time. The risk has recently been significantly reduced by introducing five years’ time limitation.
According to the rules introduced in the last amendment to the construction law, which came into force on September 19, 2020, the declaration of invalidity of the building permit and the occupancy permit may be made only during a period of five years (in the case of a decision on the building permit from the date of delivery or publication of the decision, and with regard to the decision on the occupancy permit – from the date on which the decision becomes final). As we wrote earlier, the above protection applies both to the new permits as well as to the permits issued in the past.
Invalidity proceedings, like any administrative proceedings, have a two-instance character, which is in line with one of the basic principles of Polish administrative proceedings (the two-instance principle – Art. 15 of the Code of Administrative Procedure), which guarantees parties the ability to verify of the correctness of each decision by a second-instance authority. In case of the invalidation of the building permit procedure, the first instance authority (issuing the “first decision” declaring the permit invalid) will be the voivode, and the second instance authority (the authority examining a possible appeal of a dissatisfied party) will be the Minister of Development, and in the invalidation of the occupancy permit procedure, the first instance authority will be the voivodeship building supervision inspector, and the second instance authority – Chief Inspector of Building Supervision. The decision of the first instance authority has no legal effects – it is not enforced before the expiry of the appeal period, and the lodging of an appeal within the time limit suspends the execution of the decision.
Therefore, within the five-year period referred to in the above regulation, the decision (building permit or occupancy permit) must be invalidated in both instances to be effectively eliminated. To effectively eliminate the decision both instances have to manage to issue their respective decisions (sequentially: first instance decision – appeal – second instance decision) within the above five year period of time. The mere “handling” of issuing an invalidity decision by the first instance authority within this period is not enough to effectively eliminate the building/occupancy permit (if the party exercises its right to appeal).
The issue of infinite legal uncertainty as to the stability and durability of an administrative decision, as a highly undesirable state, was the subject of analysis in many scientific works and jurisprudence, and found its culmination in a landmark judgment of the Constitutional Tribunal (in a judgment of 12 May 2015 issued in the case of reference number: P 46/13, the Constitutional Tribunal), in which – simplifying, the Constitutional Tribunal stated that if there has been a significant time lapse since the decision was issued, and the decision was the basis for acquiring the right, the admissibility of the invalidation of the decision should be excluded, even if it was issued with a flagrant violation of the law (incidentally, the Constitutional Tribunal recommended the legislator to change the law, which, unfortunately – apart from the change in the scope of building and occupancy permits discussed here – has not yet been made).
Moreover, the Constitutional Tribunal stated that the mechanisms of invalidating final decisions should be a compromise between the principle of durability of administrative decisions and principle of the the rule of law. The principle of durability of final administrative decisions is a guarantee of certainty and stability of legal transactions. Final decisions may be revoked or changed only in cases provided for and strictly defined by legal provisions (without the possibility of applying the so-called intensive interpretation). The principle of the rule of law means that procedural steps taken by a public administration authority must be based on generally applicable provisions of law. In practice, we often deal with a collision of these two principles, with situations in which they cannot be fully reconciled, and the law should carefully balance both of the above principles, and not in an absolute way grant the primacy to the rule of law principle (as is still the case on the Code of Administrative Procedure, but fortunately no longer in the field of provisions of the building law concerning building permits and occupancy permits).
The facility for which the building permit has been issued and the permit has become final, may be operated on the basis of trust in administrative decisions in accordance with the principle of durability of administrative decisions, and possible threats related to irregularities in the decisions end after five years, and in fact in practice, taking into account the length of administrative proceedings, much earlier. In practice, the first instance authority should issue an invalidity decision within four years upon its issuance to allow the proceedings to be exercised and terminated by the second instance authority before the lapse of the five-year period. If the decision of the first instance authority is not issued within four years, the probability that the second instance authority will be able to reach its decision is in practice negligible. In another words, if the first instance invalidation proceedings does not start during the first three years, risk that decision will be effectively invalidated is not high.
The theoretical possibility existing in the administrative procedure law to impose the order of immediate enforceability of the invalidity decision of the first instance authority should not apply in this case, inter alia, because it would prevent the addressee of the permit from taking advantage of the legal protection guaranteed by the newly introduced regulation.
The above-mentioned new regulation meets the needs of entities operating on the real estate market and satisfies the above-mentioned guidelines formulated by the Constitutional Tribunal and as such should be assessed very positively and will certainly have an advantageous impact on the real estate sector.
dr Andrzej Chełchowski
Partner, Dyrektor Biura | Partner, Resident Director
T: +48 22 447 43 00
M: +48 601 694 424
E: chelchowski@millercanfield.com
Disclaimer: This publication has been prepared for clients and professional associates of Miller Canfield, and is based on the facts and guidance available at the time of its release which may be subject to change. The purpose of the publication is to draw attention to the legal events indicated in it and should not be the sole basis for any decision regarding a particular course of action; nor should it be relied on as legal advice or regarded as a substitute for detailed advice in individual cases. The services of a competent professional adviser should be obtained in each instance so that the applicability of the relevant legislation or other legal development to the particular facts can be verified.