International Association of Tax Judges

International Association of Tax Judges IATJ 9th Assembly September 28-29, 2018 Ottawa, Canada International Association of Tax Judges

International Association of Tax Judges Stare Decisis vs. Change of Case Law * * * The example of a civil law country: France * * * Emmanuelle Cortot-Boucher (Rapporteur Public, Conseil d’Etat, France) International Association of Tax Judges – 9th Assembly

International Association of Tax Judges An Overview of the French System vis-à-vis the rule of Stare Decisis • France is a civil law country in which enacted law is the primary source of law. • This option is the result of history: influence of Roman law, heritage of the French Revolution Montesquieu: “Judges (…) are only the mouth that pronounces the words of the law, inanimate beings who can moderate neither its force nor its rigor” Robespierre: “the word ‘jurisprudence’ must be erased from our language. In a State with a Constitution and legislation, the jurisprudence of the courts is nothing other than the law” International Association of Tax Judges – 9th Assembly

International Association of Tax Judges • Statute law being preponderant, case law is only secondary, but not denied as a source of law. • Courts cannot create generally applicable rules by exercising their function in specific cases. Article 5 of the Civil Code: “Judges may not pronounce by means of general disposition on cases submitted to them”. • On the other hand, Courts have the obligation to apply the law even when it is unclear and to solve cases when there is no law. Article 4 of the Civil Code: “A judge who refuses to give judgment on the pretext of legislation being silent, obscure or insufficient may be prosecuted for being guilty of denial of justice”. • Case law has developed and got more and more important over time. In some fields where there was no statute law, whole areas of law were based on case law (administrative law). International Association of Tax Judges – 9th Assembly

International Association of Tax Judges • In this system, precedents are not binding. • not horizontally binding: the two Supreme Courts (Conseild’Etat and Cour de cassation) are not bound by each other’s, nor by their own precedents • not vertically binding: lower courts do not have a legal obligation to follow the precedents of the two Supreme Courts • In each case, the Court must conduct its own analysis in the light of applicable statute law. • It is forbidden to follow a precedent only because it is a precedent. A Court isn’t allowed to base its decision solely on a precedent. International Association of Tax Judges – 9th Assembly

International Association of Tax Judges • Although they are not binding, precedents play a major role in the making of the decisions of judges. • For lower courts, the hierarchy of the judicial system creates a de facto obligation to follow the precedents of the Conseild’Etat and the Cour de cassation. • For the two Supreme Courts, the precedents of the Conseild’Etat and the Cour de cassation only have a persuasive power. This power isn’t the same for all precedents. It varies according to: • the number of precedents: a “jurisprudence constante” will have a greater persuasive power than an isolated precedent; • the level of the formation of the Court which made the precedent; • the level of publication of the precedent in the digest of case law of the Conseild’Etat and the Cour de cassation: entirely published (level A), partially published (level B), not published (level C). International Association of Tax Judges – 9th Assembly

International Association of Tax Judges • The Conseild’Etat and the Cour de cassation sometimes “discover” a new principle of law. When they do so, they cannot turn back anymore and pretend that the principle has disappeared: they are bound by the principle. Examples of such principles in the tax field: • Tax adjustment has to be contradictory when the administration wants to tax on the basis of other elements than filed by the taxpayer (Conseild’Etat, Section, 7 December 2001, SA Ferme de Rumont, n° 206145). • The administration is entitled to issue additional assessments to levy tax avoided by abuse of law (Conseild’Etat, Section, 27 September 2006, Janfin, n° 260050). • The Conseild’Etat and the Cour de cassation sometimes make decisions which are valid only for future. By nature, they bound by this type of decisions. International Association of Tax Judges – 9th Assembly

International Association of Tax Judges Advantages and Disadvantages of the French System As far as the quality of case law is concerned: • More flexibility: it’s easier for the judge to change case law and to adapt it to economic, technological and societal developments. Courts aspire to improve the case law, rather than to merely maintain it. • But less predictability: it’s more difficult for parties to anticipate Court decisions. International Association of Tax Judges – 9th Assembly

International Association of Tax Judges As far as the writing of decisions is concerned: • Decisions are shorter, and therefore easier to read, because they don’t quote precedents. • Decisions leave aside a whole part of the reasoning of the judge – the part related to precedents. They are less thoroughly justified. The opinions of the advocate general, who can quote precedents, only partially remedy the problem: they reflect the personal opinion of the advocate general which may differ from the subsequent Court decision; and the advocate general doesn’t have an obligation to communicate his conclusions to the parties or the doctrine. International Association of Tax Judges – 9th Assembly

International Association of Tax Judges As far as the work of the judge is concerned: • The burden of looking for precedents mostly weighs on the judge. Parties are not encouraged to look for them. They focus on statutory law and the preparatory work for law. International Association of Tax Judges – 9th Assembly

International Association of Tax Judges How could the French system be improved? • It would be a good thing to better highlight the role precedents play in the making of Court decisions. The decisions of the Conseild’Etat and the Cour de cassation should quote the precedents on which they are based and give the reasons why other precedents which seem relevant are left out. • How about allowing judges to express concurring or dissenting opinions? It could be seen as a way to add one more criteria to the range of those used to assess the force of precedents. But it would make individual judges more visible as decision influencers, which is, at least in the present state, very far from away the French judicial culture, based on the secret of chambers. International Association of Tax Judges – 9th Assembly

International Association of Tax Judges