A little more than two years following its establishment, the Ukrainian Supreme Court is undergoing significant reform of its role in delivering justice. As distinct from the massive judicial reform back in 2017, which was launched by a single comprehensive law, the new overhaul of the Supreme Court is happening gradually.
That process of reform essentially started in October 2019, when the Ukrainian Parliament adopted a law requiring that the number of the Supreme Court judges be halved from 200 to 100. This initiative was not welcome by the judges, as the law neither provided a specific procedure for the process nor set out the relevant criteria to be considered. It remains unclear how the dismissal of judges will be handled. In addition, practicing lawyers were also deeply concerned with the downsizing of the Supreme Court as well, as some units of the Court are already significantly overloaded and unable to cope with the magnitude of incoming cases (especially tax and regulatory disputes), even with the current number of judges on board.
At the same legislative session in October, the Parliament made a first move towards reducing the Supreme Court’s caseload. The rules of procedure were amended with respect to the operation of the top unit of the Supreme Court – the Grand Chamber, which deals with the most complicated cases and jurisdictional conflicts. Initially, the rules of procedure were drafted to require that every application reaching the Supreme Court involving an appeal of jurisdictional issues (i.e., arguing that the case should properly be considered by the administrative court rather than the commercial court) be reviewed by the Grand Chamber, even if the Chamber had already ruled on proper jurisdiction for the same category of disputes dozens of times before. Parliament rectified this inefficiency by inserting a procedure to sidestep the Grand Chamber where there is a prior ruling determining a proper jurisdiction.
Although this legislative change was fairly positive, it was clearly not enough to reduce the burden on the Supreme Court. A new round of changes soon followed, and in January 2020 Parliament adopted another law, now targeting the caseload of the entire Supreme Court rather than its separate units. From now on, cassation appeals should pass through several procedural gateways to be admitted for consideration. Grounds for review of a case by the Supreme Court are essentially limited to three situations: (i) where the lower court has failed to follow an existing precedent of the Supreme Court; (ii) where there is no precedent of the Supreme Court applicable to the case; or (iii) where an applicant demonstrates that the Supreme Court should overrule its previous precedent in the case.
In practice, these changes dramatically increase the precedential value of the Supreme Court’s decisions. This approach, however, also leaves the Supreme Court reasonable discretion to regulate its workload and to set up thresholds for applications for review. We expect that the Supreme Court will rigorously apply new gateways limiting review of the cases, meaning that most cases will end up in the appellate courts.
By approving the series of legislative amendments, Parliament has justified (at least to a certain extent) its initiative to halve the number of the Supreme Court of judges and it seems that we will observe a new stage of the reform soon.
Meanwhile, in February 2020 the Constitutional Court of Ukraine handed down a controversial decision declaring that the liquidation of the predecessor of the Supreme Court – the Supreme Court of Ukraine – violated the Constitution. Although the consequences of this decision are not yet quite clear, we believe that it will not affect the ongoing enhancement of the Supreme Court.
By Vadim Medvedev, Partner, and Andriy Fortunenko, Senior Associate, Avellum