Case Number
HCJ 10042/16
Date Decided
8-6-2017
Decision Type
Original
Document Type
Summary
Abstract
The petitions challenged the Multiple Apartments Tax Arrangement (hereinafter: the Tax Arrangement) in Chapter XII of the Economic Efficiency (Legislative Amendments for the Implementation of the Economic Policy for Budget Years 2017 and 2018) Law, 5777-2016 (hereinafter: the Economic Efficiency Law), which imposed a designated tax upon owners of multiple apartments whose aggregate rights in the apartments was 249% or more. Under the Tax Arrangement, a holder of apartments to the said extent would be subject to a tax of 1% of “the determining amount” for each apartment held, exclusive of two apartments as he may choose. The Petitioners argued that there was a substantive defect in its legislative proceedings that went “to the heart of the proceedings” – a violation of the principle of the participation of Knesset members in the legislative process – that justified its annulment.
The High Court of Justice (per Justice Sohlberg, President Naor and Justices Hayut and Hendel concurring, and Justice Mazuz dissenting) granted the petitions as follows:
The High Court of Justice addressed its authority to review the Knesset’s legislative proceedings, noting that the most significant development in the matter of judicial review of legislative proceedings occurred in the Poultry Growers case. That case established that judicial intervention in the legislative process is justified only in the presence of a defect that involves a severe and substantial violation of the basic principles of the legislative process of Israel’s parliamentary and constitutional regime. Such basic principles include decision by the majority, the principle of formal equality (by which each member of Knesset has one vote), the publicity principle, and the principle of participation (by which every Knesset member has the right to participate in the legislative process).
The Court’s discussion focused upon the principle of participation. This principle establishes the right of Knesset members not merely to be physically present in plenum and committee debates, but rather requires granting a real, serious and fair possibility to examine, debate, comment and enlighten, question and consider, so that they will be able to form an informed position on the matter concerned. The Poultry Growers case established two related but not necessarily identical criteria for judicial review of the principle of participation: whether the Knesset members were denied any practical possibility of knowing about what they are voting; whether the Knesset members were denied any practical possibility of formulating their position with regard to the draft law. This now requires refinement in the sense that the focus should no longer be upon the question whether the Knesset members “were denied any practical possibility of knowing about what they are voting”, but rather on ensuring that the legislative proceedings allow the Knesset members to form a substantive position, if only in a very limited manner, in regard to the bills placed before them. Adopting a position is not a mere “passive” act, but requires a certain cognitive process, independent processing of the information presented to the Knesset member, and the formulation of an informed decision for or against the proposed law. Only when such an opportunity is provided, can it be said that the Knesset members were granted an opportunity to participate in a real, active sense in the legislative process. However, the Knesset is not under a duty to conduct a hearing like the “due process” required of administrative agencies, but Knesset members must be afforded the opportunity to formulate an informed position, if only minimally.
The following parameters may serve in assessing whether the Knesset members were, indeed, afforded the possibility for a proper debate: the length of the debate, and whether it was proportionate to the length of the bill, its complexity and the scope of its consequences; a unique, complex bill should be debated independently of other matters, sometimes in the relevant Knesset committee, in a manner that would allow appropriately serious consideration; the effect of the committee or plenum debate upon the wording and content of the bill; the factual foundations provided with the bill; the period of time that elapsed from the time the bill – or at least the essential or major part of its arrangements – was presented for examination by the Knesset members and the date of the debate; etc. This is not a “checklist” whose elements must be examined independently, but it can be useful in accordance with the particular circumstances of any specific case in assessing whether the principle of participation was met in practice.
The question in the present matter is whether the members of Knesset were afforded an opportunity to formulate an informed position in regard to the bill. The Court found that the haste that characterized the enactment of the Arrangement Law was inconsistent with the manner in which a parliamentary debate should be held. However, despite the not inconsequential problems presented by the procedural framework through which the Tax Arrangement was enacted, recourse to it does not, itself, invalidate a law. However, the cumulative circumstances surrounding the legislative proceedings of the Tax Arrangement in the course of the preparation of the bill leads to the conclusion that there was a defect that went to the heart of the legislative process. None of the individual elements of the process would, itself, serve as grounds for voiding the legislative proceedings. However, no real debate could be conducted when consideration is given to the hurried schedule in which the Knesset members were required to hear the reading of the bill, understand and process the explanation of its provisions, express their opinions and listen to other opinions, all in the middle of the night, following long days of debate on other matters, and all the while being pressed to hurry. Although the Knesset members received explanations of the bill, and it is reasonable to assume that they “knew what they were voting on”, the cumulative circumstances reflect a lack of an opportunity to conduct a real, even if minimal, debate. The members of the Finance Committee were not afforded an opportunity to formulate an opinion, and the legislative proceedings did not afford a possibility for realizing the principle of participation.
The defect in the Multiple Apartments Tax Arrangement goes to the heart of the proceedings. However, this does not require the voiding the legislation, and relative voidness would suffice. Therefore, the Court ordered the annulment of Chapter XII of the Economic Efficiency Law, i.e., the annulment of the Multiple Apartment Tax. The legislature could “return” to the legislative process from the stage of deliberation in the Finance Committee – the stage at which the defect occurred – and continue as required.
The case represents something of a development of the rule established in the Poultry Growers case. The participation principle established there was restated in a new and more detailed manner. The decision also moved the boundary and somewhat widened the scope of judicial review in regard to an infringement of the right to substantive participation.
Keywords
Constitutional Law -- Judicial Review, Constitutional Law -- Legislation
