2024/03/27 – 30 Cdo 3909/2023
Judgment of the Supreme Court of 27 March 2024, Case No 30 Cdo 3909/2023
JUDGMENT
IN THE NAME OF THE REPUBLIC
The Supreme Court decided in a Panel consisting of the President of the Panel, David Vláčil, and judges Vít Bičák and Hana Polášková Wincorová in the case of the claimant, J. C., represented by […], against the defendant, the Czech Republic – Ministry of Industry and Trade […], regarding compensation for non-material damage brought before the District Court for Prague 1, Case No 31 C 22/2021, on the extraordinary appeal lodged by the claimant against the judgment of the Municipal Court in Prague of 13 June 2023, Case No 54 Co 134/2023-143, as follows:
The judgment of the Municipal Court in Prague of 13 June 2023, Case No 54 Co 134/2023-143, in the part of operative part I, confirming operative parts I and III of the judgment of the court of first instance, and operative part II, regarding costs, and the judgment of the District Court for Prague 1 of 8 February 2023, Case No 31 C 22/2021-116, in operative parts I and III, are to be annulled and the case is to be referred back to the District Court for Prague 1 for further proceedings.
The remainder of the claimant´s extraordinary appeal is rejected.
Reasoning:
I. Proceedings Before the Lower Courts
1. By the action brought, the claimant sought an apology from the defendant, both in relation to himself and to the “citizens” [presumably of the Czech Republic], as a compensation for the non-material damage caused to him (and to the citizens of the Czech Republic) by the incorrect implementation of Directive 2002/58/EC of the European Parliament and of the Council of 12 July 2002 concerning the processing of personal data and the protection of privacy in the electronic communications sector (hereinafter the “Directive on privacy and electronic communications” or the “Directive 2002/58/EC”). It was the incorrect implementation carried out in violation of this Directive that led to the general collection and further processing of traffic and location data on electronic communications of users of electronic communications services. The claimant saw an interference with his rights to privacy and to informational self-determination in this collection of data.
2. Prior to filing the action, the claimant unsuccessfully attempted to obtain the erasure (removal) of the data retained with respect to his person, first through his mobile operator, then through the Office for Personal Data Protection (hereinafter “the OPDP”), which, in its statement of 9 March 2008, responded to the claimant that, in its opinion: “it is indisputable that the national legislation on the matter, contained in Sec. 97(3) of the Act No 127/2005 of the Coll., is inconsistent with the interpretation of Article 15(1) of the Directive 2002/58/EC of the European Parliament and of the Council (...). The inconsistency is so fundamental that it cannot be overcome by interpreting the national legislation in accordance with the EU law”. The claimant subsequently raised his claim with the defendant, who rejected the request for compensation on the grounds that the legislative activity could not be considered as maladministration within the meaning of Sec. 13 of the Act No 82/1998 Coll., on Liability for Damage Caused in the Exercise of Public Authority by a Decision or Maladministration and on Amending Act No 358/1992 Coll., of the Czech National Council, on Notaries and Their Activities, as amended […] (hereinafter the “State Liability Act” or the “Act No 82/1998 Coll.”). Thus, according to the claimant [sic! defendant], the basic prerequisite for the establishment of the State's liability, which is the existence of maladministration, has not been met.
3. By its judgment of 8 February 2023, Case No 31 C 22/2021-116, the District Court for Prague 1 (hereinafter the “court of first instance”) decided on the action and dismissed the request to declare that the defendant was obliged to send the claimant an apology by data box in the following wording: “The Czech Republic, through the Ministry of Industry and Trade, apologises to you for the fact that, by adopting legislation requiring providers of electronic communications services to store traffic and location data on Your electronic communications pursuant to Sec. 97(3) and (4) of the Electronic Communications Act, the Czech Republic has violated and continues to violate the Art. 15(1) of the Directive on privacy and electronic communications. This constitutes an unjustified interference with Your personality rights.” (operative part I). The court of first instance also dismissed the action to impose an obligation on the defendant to publish on its website www.mpo.cz in the News section for a minimum of 30 days an apology in the following wording: “The Czech Republic, through the Ministry of Industry and Trade, apologises to the citizens for the fact that, by adopting legislation requiring providers of electronic communications services to store traffic and location data on Your electronic communications pursuant to Sec. 97(3) and (4) of the Electronic Communications Act, the Czech Republic has violated and continues to violate the Art. 15(1) of the Directive on privacy and electronic communications. This constitutes an unjustified interference with their personality rights.” (operative part II). And finally, the court of first instance ordered the claimant to pay the defendant's costs (operative part III).
4. The court of first instance concluded that the damage allegedly caused to the claimant by the defendant by means of the claimed inconsistency between national legislation, on the one hand, and EU law, on the other hand, is only potential damage which is not eligible for the legal protection provided by the provisions of Sec. 81(1) and 2956 of Act No 89/2012 Coll., the Civil Code (hereinafter the “Civil Code”). Despite the court's notice, the claimant has not alleged, let alone proved, the occurrence of concrete damage as a result of the mobile operator's retention of traffic and location data relating to the claimant for a certain period of time. According to the court of first instance, the claimant's action thus resembles an actio popularis, by which he seeks protection of the public interest rather than protection of his own personality rights and which is not covered by civil law protection of the personality of a person and their natural rights.
5. The claimant appealed against that decision, arguing that the mere retention of the data was an interference with his fundamental rights, regardless of the fact whether it was misused. The claimant found the court's conclusion on the potentiality of the damage all the more surprising in view of the fact that, during the proceedings before the court of first instance, the focus of the claimant's activity had been on alleging and proving that very point, including in relation to his work as an investigative journalist, his civic activities and his publishing activities. Taken together, these thus exacerbate the negative impact of the defendant's inaction on the claimant's personality rights. According to the claimant, the court of first instance has also completely resigned itself to assessing the compatibility of the national legislation with generally binding EU legislation, ignoring the case-law of the Court of Justice of the European Union (hereinafter the “CJEU” or “Court of Justice”) in that regard. In view of the alleged inconsistency between Czech and EU legislation, the claimant proposed that the court of appeal should (if necessary) refer the matter to the Court of Justice for a preliminary ruling in accordance with Art. 267 of the Treaty on the Functioning of the European Union (hereinafter the “TFEU”). Lastly, the claimant complained that the court of first instance had failed to take evidence in the proceedings, both by omitting the evidence taken in the reasoning of its decision and by failing to take the evidence which he had proposed without giving any reasons.
6. In its judgment of 13 June 2023, Case No 54 Co 134/2023-143 (hereinafter the “contested decision”), the Municipal Court in Prague (hereinafter the “the court of appeal”) decided on the appeal submitted by the claimant in such way that it upheld the judgment of the court of first instance (operative part I of the court of appeal's judgment) and ordered the claimant to pay the costs of the appellate proceedings (operative part II of the court of appeal's judgment).
7. In the reasoning of the contested judgment, the court of appeal stated that in the present case, the first of the prerequisites for the establishment of the State's liability for damages was not fulfilled, as the defendant's actions did not constitute maladministration. According to the court of appeal, “although the adoption of a statute is an exercise of public authority, it is the result of a legislative activity of the State which cannot be regarded as maladministration and therefore liability for damage cannot be inferred. Article 36(3) of the Charter of Fundamental Rights and Freedoms (promulgated as part of the constitutional order under No 2/1993 Coll., hereinafter the “Charter”) does not establish a right to compensation for damage caused by the exercise of the Parliament's legislative power. If the legislator exceeds its limits, the Constitutional Court may intervene and annul the law or declare it unconstitutional. That has not happened in the present case.” According to the court of appeal, the claimant also failed to allege and prove anything beyond the general allegations of a long-standing distressing feeling of unjustified interference with his personality rights as to the specific manner and intensity in which that violation of his rights had manifested itself in his personal sphere in such a way as to give rise to non-material damage. In the court of appeal's view, the argument that, as an investigative journalist, he must protect his sources, was a purely general one. As regards the apology to the citizens of the Czech Republic, the court of appeal concluded that the applicant did not have the locus standi to bring an action seeking compensation for non-material damage to all citizens.
II. Extraordinary Appeal
8. The claimant (hereinafter the “applicant”) filed an extraordinary appeal against the contested decision in both of its operative parts, the admissibility of which he based on the fact that it depends on the resolution of issues of substantive and procedural law which have not yet been resolved in the decision-making of the Supreme Court (the issue of occurrence of non-material damage) or have been resolved differently by the Supreme Court (the issue of maladministration and the liability of the State for maladministration in the event of incorrect implementation of European legislation).
9. Regarding the objections relating to maladministration through the State's legislative activity, the applicant submits that the court of appeal's procedure is unreviewable, since it completely disregarded the applicant's argumentation, which was contained in the action as well as in the subsequent submissions. Although the State's legislative activity is not normally regarded as maladministration, that rule does not apply in the field of European law, where, in the event of its breach, the State is liable for damage caused by the incorrect transposition of European law into the national legal order. In that connection, he refers to the judgment of the Constitutional Court of 9 February 2011, Case No IV. ÚS 1521/10; the judgment of the Supreme Court of 20 August 2012, Case No 28 Cdo 2927/2010; and the judgment of the CJEU of 19 November 1991 in Joined Cases C-6/90 and C-9/90, Francovich and Bonifaci v Italian Republic.
10. Regarding the non-material damage suffered, the applicant stresses that the court of first instance and the court of appeal completely disregarded the fact that the mere unlawful retention of data is an interference with his right to privacy and the right to informational self-determination, irrespective of whether it was misused. In this respect, he refers to the judgments of the Constitutional Court of 22 March 2011, Case No Pl. ÚS 24/10, and of 14 May 2019, Case No Pl. ÚS 45/17, as well as the judgment of the Grand Chamber of the European Court of Human Rights of 4 May 2020, Rotaru v. Romania, Application No 28341/95. He also submits that in the present case the impact on his personal sphere is amplified by other factors (his work as an investigative journalist and the heightened perception of the importance of the interference with his privacy). However, the court of appeal did not take account of the applicant's extensive arguments and some of his evidence and did not take the evidence without giving reasons. Based on these grounds, the applicant submits that the conclusion on the absence of non-material damage is not only incorrect but also unreviewable.
11. The applicant also disagrees that the action could not oblige the defendant to apologise to other “citizens” besides himself (though not further identified – note of the Supreme Court), since it is through this action that the claimant seeks to contribute to the defendant fulfilling its obligations and initiating the necessary legislative changes. He considers that it is up to him to formulate a method which provides him with compensation for the damage sustained. In the present case, he sees as compensation not only a personal apology but also a public apology to the citizens, which will rather be an impetus for changes that will prevent the continued infringement of the rights of all persons who communicate electronically.
12. The applicant reiterated his request (repeatedly made before the courts of both instances) to initiate the preliminary ruling proceedings under Article 267 TFEU, in the context of which the Court of Justice would assess the conformity of the Czech legislation with European Union law. The applicant requested the Supreme Court to change the contested decision in accordance with the provision of Sec. 243d(1)(b) of the Code of Civil Procedure so as to uphold the action originally brought.
13. The defendant responded to the extraordinary appeal, stating that they did not consider that it was well-founded. According to the defendant, the courts of both instances were entirely correct in pointing out that the State's legislative activity cannot be regarded as administration within the meaning of Act No 82/1998 Coll. The defendant also considers that the extraordinary appeal does not fulfil the conditions for admissibility (it does not, however, further substantiate this conclusion). Since, according to the defendant, the courts of both instances decided the case “entirely in accordance with settled case-law and all the arguments put forward by the claimant were dealt with in the proceedings”, the defendant requests the Supreme Court to reject or dismiss the extraordinary appeal.
III. Admissibility of the Extraordinary Appeal
14. The Supreme Court proceeded in the proceedings on extraordinary appeal and decided on it in accordance with Act No 99/1963 Coll., the Code of Civil Procedure, as amended as of 1 January 2022 (see Art. II and XII of Act No 286/2021 Coll.), hereinafter the “Code of Civil Procedure”.
15. The extraordinary appeal was lodged in due time [Sec. 240(1) of the Code of Civil Procedure], by a person entitled to do so (the party to the proceedings) and in compliance with the condition laid down in Sec. 241 of the Code of Civil Procedure.
16. Pursuant to Sec. 236(1) of the Code of Civil Procedure, extraordinary appeal may be brought against final decisions of the court of appeal where the law permits so.
17. Pursuant to Sec. 237 of the Code of Civil Procedure, unless otherwise provided, an extraordinary appeal is admissible against any decision of the court of appeal which terminates the appellate proceedings, if the contested decision depends on the resolution of a question of substantive or procedural law, by the resolution of which the court of appeal has departed from the established decision-making practice of the Supreme Court or which has not yet been resolved in the decision-making of the Supreme Court or is decided differently by the Supreme Court, or if the legal question resolved by the Supreme Court is to be assessed differently.
18. The Supreme Court notes, first of all, that the applicant's argumentation cannot establish the admissibility of the appeal in so far as the applicant challenges operative part I of the contested decision in the extent in which the court of appeal upheld operative part II of the judgment of the court of first instance (dismissal of apology to the “citizens” via the defendant's website). The court of first instance dismissed the original action to that extent, on the ground that the applicant's action resembles an actio popularis, by which he seeks, rather than protection of his own personality rights, the protection of public interest to which civil law protection of human personality and natural rights is not afforded. The court of appeal subsequently fully agreed with the conclusion of the court of first instance on the lack of locus standi of the applicant. However, the extraordinary appeal is flawed to that extent within the meaning of Sec. 241b(3) of the Code of Civil Procedure, since the applicant has not set out in the text of the extraordinary appeal the grounds on which he claims that it is admissible to that extent, nor does he in any way dispute the reasoning of the court of appeal beyond the general assertion that the court of appeal should have upheld the action to that extent as well and that the (subjective) focus of the dispute does not actually lie for the applicant in the matter of apologising to “citizens”. The Supreme Court therefore rejected the flawed part of the extraordinary appeal pursuant to Sec. 243c(1) of the Code of Civil Procedure.
19. The extraordinary appeal is inadmissible to the extent in which it is directed against operative part II of the contested decision on the costs of the appellate proceedings and against operative part I of the contested decision to the extent in which the court of appeal upheld operative part III of the judgment of the court of first instance on the costs of the first-instance proceedings, since the extraordinary appeal is not objectively admissible pursuant to Sec. 238(1)(h) of the Code of Civil Procedure to the extent in which the court of appeal decided on the costs of the proceedings. This does not, of course, prevent the Supreme Court from setting aside such judgments as well, if it finds grounds for setting aside the judgment on the merits.
20. However, the contested decision of the court of appeal, to the extent in which it upheld operative part I of the judgment of the court of first instance, depends on the resolution of the question, which is decisive for the case, as to whether the State's legislative (in)action in matters relating to the need for proper transposition of EU law can be regarded as maladministration compensable under Sec. 13 of the State Liability Act. As the court of appeal departed from the established decision-making practice of the Supreme Court in resolving this legal question, the Supreme Court concluded that the applicant's extraordinary appeal was admissible to that extent under the provision of Sec. 237 of the Code of Civil Procedure.
21. At the same time, the contested decision also depends on the resolution of another question admissibly open to extraordinary appeal concerning the potentiality of damage caused by the interference with the right to informational self-determination by means of legislation which, according to the applicant, is contrary to EU law. Since that question has not yet been fully resolved in the case-law of the Supreme Court, the extraordinary appeal is admissible under Sec. 237 of the Code of Civil Procedure to that extent as well.
22. Having examined the judgment of the court of appeal in accordance with the provision of Sec. 242 of the Code of Civil Procedure, which was carried out without a hearing [Sec. 243a(1), first sentence, of the Code of Civil Procedure], the Supreme Court has come to the conclusion that the extraordinary appeal is not only admissible in relation to both of the above-mentioned issues, but that it is also well-founded.
IV. Well-Foundedness of the Extraordinary Appeal
On the Responsibility of the State for Legislative Activity
23. The contested decision depended on the resolution of the legal question of the State's possible liability for its legislative (in)activity in relation to the need for proper transposition of EU law.
24. The court of appeal correctly stated that, as a general rule, legislative activity cannot be regarded as maladministration within the meaning of Sec. 13 of the State Liability Act [it is not an exercise of State power within the meaning of Sec. 1(1) of the State Liability Act]. The Supreme Court has expressed its views on this issue, for example, in its judgments of 31 January 2007, Case No 25 Cdo 1124/2005, of 15 June 2016, Case No 30 Cdo 3598/2014, or of 27 February 2018, Case No 21 Cdo 254/2017, in which it held that, since the Parliament, consisting of the Chamber of Deputies and the Senate, is the supreme legislative body (cf. Art. 15 of the Constitution), which, in the conditions of representative democracy, decides by a vote of its members – deputies and senators – whether or not to accept a bill submitted to it, and there is not and cannot be a rule or regulation on how any deputy, senator or group of deputies or senators should vote when passing laws [according to Art. 23(3) and 26 of the Constitution, deputies and senators are obliged to exercise their mandate in the interests of all the people and according to their best knowledge and conscience, and are not bound by any orders], the process of passing laws by voting in the Chamber of Deputies or the Senate cannot be considered administration within the meaning of Sec. 13 of the Act No 82/1998 Coll.
25. However, this conclusion does not apply in the case of damage (also, as will be explained below, non-material damage) caused by (alleged) breaches of EU law and in the case of joint liability claims against the State, as these are based on EU law itself. Thus, the liability of the State for damages caused by maladministration within the meaning of Sec. 13 of the State Liability Act and the liability of the State for a breach of EU law cannot be confused, as the court of appeal (and, together with it, the court of first instance) did in its conclusions in the contested decision, since these are mutually separate systems (cf., e.g., Supreme Court judgments of 26 September 2007, Case No 25 Cdo 2064/2005; of 20 August 2012, Case No 28 Cdo 2927/2010; or of 15 June 2016, Case No 30 Cdo 5027/2014; and also Constitutional Court judgment of 9 February 2011, Case No IV. ÚS 1521/10). Act No 82/1998 Coll. itself is applied only analogically when asserting claims based on the State's liability for breach of EU law, due to the absence of national legislation explicitly regulating this area (cf., e.g., the Supreme Court judgment of 14 November 2018, Case No 30 Cdo 486/2018, paragraph 27). However, an analogical (or rather just proportionate) application of Act No 82/1998 Coll. cannot, on the one hand, lead to a restriction of the substantive rights established by EU law, while, at the same time, the procedural conditions for compensation for damages established by national legislation must not be less favourable than those applicable to similar claims arising under national law (principle of equivalence) and must not be regulated in such a way as to make it impossible or excessively difficult in practice to obtain compensation for damages (principle of effectiveness). For that reason, the court of appeal's conclusions to the contrary do not stand.
26. The Supreme Court has repeatedly recalled (cf., e.g., the Supreme Court judgments of 15 June 2016, Case No 30 Cdo 3598/2014; of 15 June 2016, Case No 30 Cdo 5027/2014; or of 28 May 2018, Case No 30 Cdo 4231/2016) that the conditions for the application of the principle of state liability for damage caused by a violation of EU law are and have been clearly defined by the established case-law of the Court of Justice. The existence of compensation for damages as an instrument arising from EU (then Community) law was already established by the Court of Justice in its judgment of 19 November 1991, in Joined Cases C-6/90 and C-9/90, Francovich and Bonifaci v Italian Republic. There, the Court of Justice recalled that the EEC Treaty (now the TFEU) created its own legal order, integrated into the legal systems of the Member States, which binds the courts and whose subjects are not only the Member States but also their nationals, on whom EU law imposes both obligations and confers rights. It further emphasised in the decision that “the national courts whose task it is to apply the provisions of Community [Union] law in areas within their jurisdiction must ensure that those rules take full effect and must protect the rights which they confer on individuals. … The full effectiveness of Community rules would be impaired and the protection of the rights which they grant would be weakened if individuals were unable to obtain redress when their rights are infringed by a breach of Community law for which a Member State can be held responsible. The possibility of obtaining redress from the Member State is particularly indispensable where …. the full effectiveness of Community rules is subject to prior action on the part of the State and where, consequently, in the absence of such action, individuals cannot enforce before the national courts the rights conferred upon them by Community [Union] law.” From the above conclusions, the CJEU thus concluded that the principle of State liability for damage caused to individuals by breaches of European Union law is inherent to European Union law and finds its basis “in Article 5 of the Treaty [now Article 4(3) TFEU], under which the Member States are required to take all appropriate measures, whether general or particular, to ensure fulfilment of their obligations under Community law [now: the Treaties or acts of the institutions of the Union].”
27. Then, in its judgment of 5 March 1996, in Joined Cases C-46/93 and C-48/93, Brasserie du pêcheur SA, Factortame Ltd and Others, the Court of Justice went on to hold that, in the case of an infringement of a right conferred directly on an individual by a rule of EC (now EU) law, the right to compensation arises from the direct effect of the rules of Union law whose infringement caused the damage suffered. Thus, the breach of directly effective rules gives rise to State liability for damages. Since the EEC Treaty (now the TFEU) contains no provision expressly regulating the consequences of a breach of a right conferred on an individual, the State's liability must be assessed in the light of the fundamental principles of the European Union legal system.
28. The specific conditions under which the liability of the State for a breach of EU law gives rise to an individual's right to compensation for damages are laid down in the above-mentioned CJEU judgment of 19 November 1991, in Joined Cases C-6/90 and C-9/90, Francovich and Bonifaci v Italian Republic; the CJEU judgment of 5 March 1996, in Joined Cases C-46/93 and C-48/93, Brasserie du pêcheur SA, Factortame Ltd and Others; and the CJEU judgment of 30 September 2003, Case C-224/01, Gerhard Köbler, and are constituted followingly:
a) the objective of the infringed legislation is to confer rights on individuals: a right to compensation for damage to an individual therefore arises where a Member State infringes a rule of EU law which creates a sufficiently identifiable subjective right or protects a legal interest in favour of that individual;
b) the infringement must be sufficiently serious, the degree of gravity is interpreted in the context of EU law according to the margin of discretion conferred on the national authority by the legislation in question. Sufficient gravity is defined by the settled case-law of the CJEU as arising in circumstances where the decision-making authority has manifestly and gravely exceeded the limits of its discretion (cf. CJEU judgment of 4 July 2000, Case C-352/98 Laboratoires Pharmaceutiques Bergaderm SA and Jean-Jacques Goupil). In Brasserie du pêcheur SA, Factortame Ltd and others, the CJEU defined that “the factors which the competent court may take into consideration include the clarity and precision of the rule breached, the measure of discretion left by that rule to the national or Community [Union] authorities, whether the infringement and the damage caused was intentional or involuntary, whether any error of law was excusable or inexcusable, the fact that the position taken by a Community [Union] institution may have contributed towards the omission, and the adoption or retention of national measures or practices contrary to Community [Union] law” (cf. CJEU judgment of 5 March 1996, in Joined Cases C-46/93 and C-48/93, Brasserie du pêcheur SA, Factortame Ltd and Others, paragraph 56). The starting point for determining whether an infringement of EU law committed by a Member State is sufficiently serious is therefore to ascertain what degree of discretion the Member State exercised or what competences it had in relation to the interpretation and application of EU law. Accordingly, where the authority has a wide margin of discretion, the infringement is grave if it amounts to a manifest and grave breach of the limits of that discretion, and, conversely, where the margin of discretion is limited or non-existent, the gravity is established by the infringement of EU law itself (cf. MALÍŘ, Jan. Odpovědnost členských států za škodu v právu Evropské unie. Univerzita Karlova v Praze, Právnická fakulta, 2008, p. 107);
c) there must be a causal link between the breach of duty by the Member State and the damage sustained by the injured party. In assessing the causal link, it is necessary, on the basis of the case-law of the CJEU, to examine whether the causal link has been broken by the acts or omissions of another subject of law or by the intervention of force majeure (cf. CJEU decision of 15 June 1999, Case C-140/97, Rechberger and Others), or by the fact that the party themselves contributed to the damage by their acts or omissions, or by failing to fulfil their duty to mitigate the damage.
29. All three conditions (infringement of a provision of EU law conferring rights on an individual, sufficiently serious breach, causal link between the breach and the damage) must be met cumulatively and they apply to any form of infringement of EU law and are therefore both necessary and sufficient for individuals to have a direct right to compensation (cf. CJEU judgment of 5 March 1996, in Joint Cases C-46/93 and C-48/93, Brasserie du pêcheur SA, Factortame Ltd a Others, paragraph 51; CJEU judgment of 19 March 1991, Case C-202/88, British Telecommunication, paragraph 38; CJEU judgment of 23 May 1996, Case C-5/94, Hedley Lomas, paragraph 24; and more recently, e.g., CJEU judgments of 26 January 2010, Case C-118/08, Transportes Urbanos y Servicios Generales SAL, paragraph 30; of 15 November 2016, Case C-268/15, Ullens de Schooten, paragraph 41; or of 10 March 2022, Case C-177/20, “Grossmania”, paragraph 69).
30. If the above conditions are met, the State must provide compensation for the damage sustained in accordance with the national law governing the liability, while the procedural and substantive conditions for compensation laid down by national law cannot be less favourable than those applicable to similar claims arising under national law and must not, in practice, make it impossible or excessively difficult to obtain the compensation (see the above-mentioned judgment of the CJEU in Case Francovich, paragraph 43, or also, for example, the CJEU judgment of 9 November 1983, Case 199/82, San Giorgio, paragraph 14; of 17 April 2007, Case C‑470/03, AGM COS-MET, paragraph 89; more recent decisions have abandoned the explicit reference to procedural and substantive conditions for compensation in favour of a more general condition, but this is still a line of case-law referring to the original Francovich decision; cf., e.g., CJEU judgments of 9 September 2015, Case C-160/14, Ferreira da Silva e Brito, paragraph 50; of 4 October 2018, Case C-571/16, Kantarev, paragraph 123; or of 28 June 2022, Case C-278/20, Commission v Spain, paragraph 33).
31. In the context of domestic law, the above-mentioned means that if the Czech Republic is held liable for a breach of EU law, the injured party may, subject to other conditions, be entitled to compensation for both the material and non-material damage. In fact, the provisions of Sec. 1(3) and 31a of the State Liability Act, which were incorporated into Act No 82/1998 Coll. by an amendment through Act No 160/2006 Coll., also explicitly included compensation for non-material damage in the regime of the State's liability for the exercise of public authority (specifically, for maladministration and unlawful decisions). Thus, in accordance with the fundamental principle of EU law enshrining the principle of equivalence, claims for the breach of EU law must also include the possibility of claiming compensation for non-material damage, provided that the statutory conditions are met. This conclusion then applies even if the violation of EU law has been committed by legislative activity, despite the fact that legislative (in)activity cannot be regarded as maladministration within the meaning of Act No 82/1998 Coll., and this Act does not apply to legislative activity of the State in purely domestic situations (as explained above). A contrary interpretation would inadmissibly lead to a de facto division of liability for breaches of EU law, so that, in so far as the breach of EU law corresponds to maladministration or was committed by means of an unlawful decision, the injured party would be awarded both material and non-material damages, whereas in the case of a breach of EU law by legislative (in)activity, only material damages would be awarded. However, there is no similar division (limitation) under national law, since the form of appropriate compensation under the above-mentioned law includes compensation for both material and non-material damage, depending on the circumstances. There is no rational reason for introducing any division in the form of compensation exclusively in the area of breaches of EU law and, on the contrary, it is appropriate to conclude that, despite the exception which, in the context of Act No 82/1998 Coll., constitutes a legislative (in)activity, it is precisely this Act which, in the case of material or non-material damage caused by incorrect transposition of EU directives, is the closest legislation in content which is reasonably applicable to determining the extent and form of the compensation awarded.
32. It can also be pointed out that, in paragraph 42 of its judgment in Brasserie du pêcheur, cited above, the Court of Justice stated that the conditions under which States may incur liability for damage caused to individuals by a breach of European Union law cannot, in absence of particular justification, differ from those governing the liability of the Union in comparable circumstances. In fact, the protection of the rights conferred on citizens by EU law cannot vary depending on whether a national authority or a European Union authority is responsible for the damage (cf. also CJEU judgment of 4 July 2000, Case C-352/98 P Bergaderm SA, paragraph 41). In the field of non-contractual liability of the Union itself, EU law awards both compensation for material and for non-material damage (see, for example, CJEU judgment of 3 February 1994, Case C-308/87, Grifoni; judgment of the Court of First Instance [now: General Court] of 8 October 1992, Case T-84/91, Meskens; or recently, e.g., General Court judgments of 20 October 2021, Case T-220/20, Kerstens; and of 27 October 2018, in Joint Cases T‑314/16 and T‑435/16, VG). Although, in practice, the systems of liability of the European Union and the Member States for breaches of EU law are not identical, the Supreme Court considers that the above clearly leads to the conclusion that compensation for damage caused by a breach of EU law is not necessarily limited to compensation for material damage, but should, on the contrary, in principle also include compensation for non-material damage, provided that the statutory conditions for its award are met.
33. It can thus be summarized from the above conclusions that in circumstances where there is no adequate regulation of the State's liability for breach of EU law at the national level in the Czech Republic, the conditions of State liability arising from the case-law of the Court of Justice apply in a situation where EU law is breached, in accordance with the principle of primacy, and the national Act No 82/1998 Coll. applies only insofar as EU law (including the case-law of the Court of Justice) does not provide otherwise. In other words, Act No 82/1998 Coll. applies proportionately only where its provisions are consistent with those of EU law or to matters not dealt with by EU law, provided that they do not in any way make it impossible or excessively difficult for an individual to obtain compensation.
34. In the circumstances of the present case, the above means that the court of appeal wrongly assessed the claim as one based on Sec. 13 of the State Liability Act. The prerequisites for the State's liability for breach of EU law apply generally, in relation to the activities of all State bodies, including the legislative ones (cf., for example, Supreme Court judgment of 24 June 2020, Case No 30 Cdo 2416/2018; or the CJEU judgments of 18 January 2022, Case C-261/20, Thelen Technopark Berlin, paragraph 43; or of 4 October 2018, Case C-571/16, Kantarev, paragraph 93). It is thus irrelevant to the case, as the court of appeal concluded, that the infringement of EU law occurred through the legislator's inactivity in the light of the CJEU's judgment of 8 April 2014, in Joined Cases C-293/12 and C-594/12, Digital Rights Ireland, which declared invalid a directive, the transposition of which had led to and continues to lead to the storage of traffic and location data.
On the Relationship Between Interference with a Fundamental Right and Arising of Non-Material Damage
35. In the second part of his extraordinary appeal, the applicant puts forward the thesis according to which an unjustified interference with a fundamental right (here the right to protection of personal data, respectively the right to informational self-determination) always leads to non-material damage. According to the applicant, the court of appeal erred in basing the contested decision on the conclusion that the applicant failed to meet the burden of proof in relation to the damage sustained.
36. The applicant cannot be agreed with in so far as he constructs, ipso facto, a presumption of the existence of damage from the alleged interference with the fundamental right to protection of personal data constituted by the unauthorised storage of his traffic and location data and, at the same time, a presumption of fulfilment of the necessary prerequisite of a causal link between the interference and the damage (in other words, he equates the breach of an obligation with the suffering of damage). Nevertheless, the court of appeal's legal assessment is incorrect.
37. As it follows from the case-law conclusions set out above, three conditions must be met for the State to be held liable for a breach of EU law: first, the breached rule of EU law confers rights on the injured parties; second, the breach of that rule is sufficiently serious; and third, there is a direct causal link between that breach and the damage suffered by the injured parties (this construction is, apart from the question of fault, similar to the conditions for liability in tort under Sec. 2910 of Act No 89/2012 Coll., Civil Code; cf., for example, Supreme Court judgment of 25 November 2022, Case No 25 Cdo 1621/2021; or the liability of the State under Act No 82/1998 Coll.). This construction implies the conceptual separation of the interference (corresponding to the violation of the rule itself or the unlawful act) and the damage (corresponding to the consequence of the unlawful act) in their mutual relationship of cause and consequence.
38. For this reason, the applicant's references to the judgments of the Constitutional Court of 22 March 2011, Case No Pl. ÚS 24/10, and of 14 May 2019, Case No Pl. ÚS 45/17, as well as to the judgment of the Grand Chamber of the European Court of Human Rights of 4 May 2000, Rotaru v. Romania, Application No 28341/95, are irrelevant since the passages referred to by the applicant cover precisely the interference with a fundamental right (which, however, was not dealt with by the courts in the case under review), but not the occurrence of damage, which must be consistently distinguished from the interference itself.
39. It is possible to agree with the applicant to a certain extent that the context of the (possible) misuse of personal data stored with telecommunications service providers in the light of the above means that proving of concrete damage (primarily non-material, but mutatis mutandis also material) will be more difficult due to the intangible nature of the personal data, the difficulty of accessing it and the “remoteness” of the processor. However, according to the Supreme Court, just because of this the nature of the non-material damage is not specific enough as to construe the reason for presumption of the existence of non-material damage and the causal link (as in the case of liability for unreasonable length of proceedings, to which the applicant refers by analogy, or in the case of violation of the right to effective investigation – cf. Supreme Court judgment of 24 February 2021, Case No 30 Cdo 3509/2019). This conclusion can also be supported by reference to the case-law of the Court of Justice, which has concluded that, even in the case of non-material damage caused by the incorrect processing of personal data, the existence of the damage suffered is one of the conditions of the right to compensation for damage, as is the existence of a breach of a legal obligation and a causal link between that damage and the breach, the three conditions being cumulative. Therefore, it cannot be concluded that any “breach” of a Union provision in itself gives rise to the said right to compensation for damage in favour of the data subject. According to the Court of Justice, a mere infringement of EU law with regard to the processing of personal data is therefore not sufficient to establish a right to compensation for damage, since the question of that infringement is different from the question of the existence of damage (cf. CJEU judgments of 4 May 2023, Case C-300/21, Österreichische Post AG, paragraphs 28–42; of 14 December 2023, Case C-340/21, Nacionalna agencia za prichodite, paragraph 77; of 14 December 2023, Case C-456/22, Gemeinde Ummendorf, paragraph 21; or of 25 January 2024, Case C-687/21, MediaMarktSaturn, paragraph 58).
40. The Supreme Court thus concludes that the applicant's view of the presumption of the existence of damage must be rejected and that the existing case-law on compensation for non-material damage (as summarised below) is applicable to the proceedings under review. However, the court of appeal departed from those conclusions in the contested decision.
On the Issue of Non-Material Damage Caused by Incorrect Processing of Personal Data
41. In the past, the Supreme Court has held that the suffering of non-material damage cannot generally be proven, as it is a state of mind of the injured party. Conclusions as to its existence thus essentially consist “only” in establishing whether there are objective reasons for a particular person to feel aggrieved. In other words, it is necessary to consider whether, in the particular circumstances of the case, another person in a similar position might also feel affected in the elements which, in their entirety, constitute the individual's non-material sphere. It is the suffering of those intangible values which touch upon the moral integrity of the injured party (this includes, in particular, their dignity, honour, reputation, but also other values which, as a rule, are also reflected in a person's private life – freedom of movement, family life, insecurity, etc.). Thus, if the court concludes in a particular case that none of these elements could have been adversely affected in a significant way as a result of an unlawful decision or maladministration, it is appropriate to conclude that there was no non-material (moral) damage suffered (cf. Supreme Court judgments of 25 April 2018, Case No 30 Cdo 1614/2016; of 20 January 2016, Case No 30 Cdo 2865/2015; of 23 May 2021, Case No 30 Cdo 3509/2019; or of 25 January 2022, Case No 30 Cdo 429/2021).
42. However, another person in a similar position cannot be understood as any other person (“average citizen”) subjected to the same treatment. The existence of non-material damage must always be measured against that other person or persons whose rights have been similarly affected and who are aware of such interference. Taking into account the specific circumstances of the case also involves taking into account sufficiently general, but not necessarily universally shared, characteristics associated with the position of the person concerned. Thus, for example, the Supreme Court, in its judgment of 11 November 2015, Case No 30 Cdo 3849/2014, considered a case in which the unlawful conduct of a police commissioner (who contested the right of an attorney, or his client, to make an audio recording of the questioning, refused to accept the granting of a power of attorney in the record, refused to record certain facts which the attorney insisted on, refused to issue the record to the attorney after the end of the questioning, filed a complaint against the attorney with the Czech Bar Association, which was dismissed as unfounded, etc.) interfered with the rights of the persons being questioned, but also with the rights of the attorney representing those persons. The Supreme Court has taken into account the fact that during the activity in question, as well as during the attorney practice in general, an attorney will be forced to defend and assert their (or their client's) opinion against the opinion of other persons and will get into conflict situations which are emotionally tense and often stressful or humanly unpleasant. An attorney must therefore anticipate and tolerate a certain degree of mental discomfort arising during the exercise of their profession. For that reason, the Supreme Court then upheld the conclusion of the lower courts there regarding the absence of non-material damage.
43. It thus follows that the courts must, in principle, take due account of the status of the person concerned and other sufficiently generalisable circumstances (whether they aggravate or exclude the damage) when considering the arising and extent of non-material damage (i.e., whether the person concerned has objective reasons to feel aggrieved).
44. In view of the considerable abstraction connected with the processing of personal data, which generally takes place outside the direct control of the data subject (and, in the case of the average citizen, not infrequently without their knowledge), as well as in view of the conclusions of the courts of both instances, which concluded, that the applicant's allegations of a long-lasting distressing feeling of unjustified interference with his fundamental rights indicate only potential damage, the Supreme Court finds it necessary in the present case to comment also on the issue of (potential) non-material damage in the specific context of the incorrect processing of personal data. This is closely linked to the protection of the fundamental rights to privacy and informational self-determination.
45. According to Art. 10(3) of the Charter of Fundamental Rights and Freedoms (hereinafter the “Charter”), everyone has the right to protection against unlawful collection, disclosure or other misuse of personal data.
46. According to Art. 52(1) [Sic! Art. 51(1)] of the Charter of Fundamental Rights of the European Union (hereinafter the “EU Charter”), the provisions of this Charter, while respecting the principle of subsidiarity, are addressed to the bodies and institutions of the Union, as well as to the Member States, only when they are implementing the Union law. They shall therefore respect the rights, observe the principles and promote the application thereof in accordance with their respective powers, while keeping within the limits of the competences conferred on the Union by the Treaties.
47. According to Art. 7 of the EU Charter, everyone has the right to respect for his or her private and family life, home and communications.
48. Under Art. 8(1) of the EU Charter, everyone has the right to the protection of personal data concerning him or her.
49. According to Art. 8(2) of the EU Charter, such data must be processed fairly for specified purposes and on the basis of the consent of the person concerned or some other legitimate basis laid down by law.
50. Directive 2002/58/EC, the breach of which is the subject of the present proceedings, does not itself contain a system of compensation for the damage caused by the collection and retention of personal data in breach of this Directive that could serve as a guide for the interpretation of domestic legislation which (within the limits of the principles of equivalence and effectiveness) defines the scope of the compensation awarded.
51. However, the Court of Justice has previously expressed certain principles relating to the arising and nature of non-material damage caused by the unauthorised processing of personal data. The close link between the issue of the processing of personal data and the protection of the fundamental rights to privacy and informational self-determination within the meaning of Art. 7 and 8 of the EU Charter [which, as of 1 December 2009 is no longer directed only at the EU institutions themselves, but also binds the Member States in the areas covered by EU law, with the result that its provisions can in principle also be invoked by individuals (cf., e.g., CJEU judgment of 26 February 2013, Case C-617/10, Fransson, paragraphs 17–21; or Constitutional Court judgment of 3 November 2020, Case No Pl. ÚS 10/17, paragraph 55)], as well as Art. 10(3) of the Charter (on the relationship between the Charter and EU Charter, cf. Constitutional Court judgment of 10 November 2020, Case No Pl. ÚS 33/16, paragraph 168), together with the need to have a coherent and predictable system of protection of these fundamental rights, makes it impossible to proceed without taking into account the conclusions adopted by the Court of Justice on non-material damage caused by incorrect processing of personal data.
52. The Court of Justice had the opportunity to express its views on the nature of non-material damage caused by unlawful processing of personal data in the context of Art. 82 of Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (hereinafter the “GDPR”). This provision states that anyone who has suffered material or non-material damage as a result of an infringement of this Regulation has the right to receive compensation from the controller or processor for the damage suffered.
53. Here, the Court of Justice has held that the damage suffered by data subjects may consist, in particular, in the mere “loss of control” over their own data as a result of an infringement of the Regulation, even where there has been no actual misuse of the data concerned to the detriment of those persons. Thus, where a data subject claiming compensation on this basis argues that he or she fears that his or her personal data will be misused in the future as a result of such an infringement, the national court before which the case is brought must verify that that fear can be considered justified in the particular circumstances and in relation to the data subject. In other words, the mere fear of a possible misuse of personal data by third parties felt by the data subject may in itself constitute non-material damage (cf. the CJEU's decisions cited in paragraph 39, Nacionalna agencia za prichodite, paragraph 85; and MediaMarktSaturn, paragraph 65).
54. The Court has also held that – in particular with a view to ensuring a consistent and high level of protection of natural persons in relation to the processing of personal data – Art. 82 of the GDPR must be approached in such a way that compensation for non-material damage within the meaning of this provision cannot be made conditional on the fact that the damage suffered by the data subject has reached a certain degree of seriousness (cf. the CJEU's decisions cited in paragraph 39, Österreichische Post AG, paragraph 51; and Gemeinde Ummendorf, paragraph 19).
55. Applying the above conclusions to the circumstances of the present proceedings means that the court of first instance's conclusion that the applicant alleged only potential damage and, on the contrary, did not allege or prove any concrete damage caused by the unauthorised collection and storage of traffic and location data, is incorrect. In the event of an interference with the fundamental right to respect for privacy and protection of personal data, the mere fear of misuse of personal data [it may also be reasonably pointed out that the risk of misuse and unauthorised access to traffic and location data arises from the mere storage and subsequent retention of that data by the provider of electronic communications services (cf. CJEU judgment of 6 October 2020, Case C-623/17, Privacy International, paragraph 73)] is capable of constituting non-material damage. In the light of the conclusions of the Court of Justice's decisions referred to in the preceding paragraph, which modify the general conclusions on the arising of non-material damage, according to which it is necessary that one of the components constituting, in their entirety, the individual's non-material sphere has been significantly affected (cf. paragraph 41 of this judgment), it is therefore appropriate to conclude that, although the courts cannot completely resign themselves to findings of fact as to the existence of damage caused by the unlawful retention of personal data and to infer the damage from the mere interference with the right to privacy and informational self-determination itself, it will normally be sufficient for the conclusion as to the arising of non-material damage that the perception of interference with the moral integrity of the person concerned does not appear unlikely, given the particular circumstances of the case and the position of that person. It is clear that it is precisely a possible breach of EU law by the State that would be one of the significant causes of damage in terms of the necessary causality, even though the State and its authorities do not themselves directly collect or retain the data.
56. Thus, in the present case, the focus of the applicant's evidence with regard to the existence of non-material damage must lie (in particular) in the allegations and evidence relating to his position and (mainly) the objective factors causing him to feel aggrieved (whether as an ordinary citizen or as a person who is more consistently involved in the issue) by the storage of traffic and location data (with the latent possibility of its misuse). The applicant's procedural activity, aimed at proving his profession as a journalist as well as his professional and leisure-time focus on the issue of personal data, cannot therefore be rejected by the court as irrelevant simply because, according to the lower courts, it does not directly point to a concrete and measurable damage. Thus, if the court of first instance called upon the applicant: “to allege and prove how the specific legislative process alleged, i.e., maladministration (sic!), has concretely harmed the applicant. It is necessary to state the concrete damage to the applicant, not that there was general damage to a potential subject” (see the resolution of the court of first instance of 26 September 2022, Case No 31 C 22/2021-79), it thus made demands on the applicant which are both difficult to meet and contrary to the above conclusions.
57. The Supreme Court further adds on the matter in question that, if a violation of EU law is found in further proceedings, the assessment of non-material damage must be carried out in such a way that the fundamental right to privacy and informational self-determination is not emptied and that the requirements for proving the existence and extent of the damage are not, in the light of the case-law cited above, excessive and do not lead to the practical unenforceability of the right to informational self-determination; which, on the other hand, does not mean that a thorough proving of all the circumstances of the case does not have its place in the present case since those circumstances always play a role in the consideration of the form or amount of the compensation awarded (although the applicant does not claim pecuniary compensation in the present case). This follows, in particular, from the second sentence of Sec. 31a(2) of the State Liability Act which emphasises the gravity of the damage sustained and the circumstances from which the damage was caused (cf. Supreme Court judgments of 27 June 2012, Case No 30 Cdo 3731/2011; or 25 January 2022, Case No 30 Cdo 429/2021) and, for infringements of EU law, also from the principle that compensation for the damage caused to individuals by an infringement of EU law must be proportionate to the damage sustained so as to ensure effective protection of their rights (cf., for example, the CJEU's decision in Brasserie du pêcheur and Factortame, paragraph 82, cited above; or the CJEU judgment of 25 March 2021, Case C-501/18 Balgarska Narodna Banka, paragraph 125).
58. For the sake of further proceedings, it may also be recalled that in the judgment of the Supreme Court of 11 January 2012, Case No 30 Cdo 2357/2010, it was clarified, albeit for the purposes of providing compensation for the restriction of personal liberty, that an apology as a means of compensation involving the statement of the injured party's subjective demand for a display of the State's favourable will towards them is neither a finding of a violation of a right nor monetary compensation for non-material damage. By exercising it, the injured party is expressing that they seek the acknowledgement of the error. In a functioning State based on the rule of law and recognising the rules of decency, it should always be available as a compensatory means of first, for many even only, choice (cf. also, for example, Supreme Court judgments of 19 November 2014, Case No 30 Cdo 3850/2014; or of 30 September 2019, Case No 30 Cdo 3011/2018).
59. Finally, the Supreme Court points out that the adaptation of the CJEU's approach to the questions of the nature of non-material damage caused by unlawful processing of personal data, as expressed by the Court of Justice in the context of Art. 82 of the GDPR, does not mean that the applicant's claim in the present proceedings is established by this provision or that its (albeit analogous) application is taking place. As is clear from this provision, Art. 82 of the GDPR governs the relationship between the person, who has suffered damage as a result of an infringement of this regulation, and the controller or processor, who the defendant is not in the circumstances of the present proceedings. Thus, despite the conclusions set out below, the present case is still a case of non-contractual liability of the State for the breach of EU law, in the context of which it is within the discretion of the Member State to determine the specific conditions for the assertion of the related claims (in the absence of EU rules and in compliance with the principles of equivalence and effectiveness).
60. Although the conditions for bringing a claim in the present case and in the case of a hypothetical claim for compensation under Art. 82 of the GDPR are thus undoubtedly different, the Supreme Court considers that it is nevertheless necessary to approach precisely the issues relating to the existence of non-material damage, if possible, in a uniform manner.
61. First of all, both Directive 2002/58/EC and the GDPR aim to protect the fundamental right to privacy and informational self-determination guaranteed by the EU Charter [cf. Art. 1(1) and recital 12 of the Directive 2002/58/EC and Art. 1(2) and recitals 3, 10 and 51 of GDPR] and, in the domestic context, Art. 10(3) of the Charter (cf. paragraph 51 of this judgment). In both cases, the protection of an identical interest is at stake, i.e., “the right of every person to decide for themselves what data about themselves they provide to other persons or make public, while their consent is also necessary for collection or disclosure of their data by other persons” (cf. Constitutional Court judgment of 27 November 2012, Case No Pl. ÚS 1/12, paragraph 301). At the same time, the nature of the interference with fundamental rights alleged by the applicant in the present case, i.e., the retention of personal data by a telecommunications service provider without the consent of the person concerned or any other appropriate legal basis, outside the responsible entity, is in principle comparable to the situations covered by Art. 82 of the GDPR (and the CJEU case-law cited above). In other words, although the obligation of proper implementation is directed towards the State, while the obligations stemming from the GDPR are directed towards the controller and processor of personal data (which will typically be private law persons), in the circumstances of a given natural person, the incorrect transposition of Directive 2002/58/EC, if it comes to the light in further proceedings, will be comparable to the processing of personal data without a legal basis; that is, the processing of personal data even in those situations where the natural person is protected from such processing by EU law. In such a situation, an approach whereby the question of the occurrence of non-material damage would be assessed differently depending on whether the interference was caused by a breach of the GDPR obligations by the controller or by a breach of EU law by the State (i.e., where domestic law would consider the loss of control and the fear of misuse of personal data as damage in one case and not in the other) would be detrimental to the predictability of the system of protection of fundamental rights. Thus, in order to ensure equal treatment in comparable situations, it is necessary to take into account the above-mentioned conclusions of the Court of Justice adopted in the context of Art. 82 of the GDPR also in circumstances which are otherwise principally governed by the domestic legal order.
62. Finally, it may also be pointed out that, in order to ensure the effectiveness of all the provisions of EU law, the principle of primacy requires national courts, in particular, to interpret their national law in conformity with EU law to the greatest extent possible and to afford individuals the possibility of obtaining redress where their rights have been impaired by a breach of EU law attributable to a Member State (cf. CJEU judgments of 24 June 2019, Case C-573/17, Popławski, paragraph 57; of 8 March 2022, Case C-205/20 Bezirkshauptmannschaft Hartberg-Fürstenfeld, paragraph 35; or of 4 May 2023, Case C-78/22, ALD Automotive, paragraph 39).
On the Procedural Defects
63. In relation to the question of non-material damage, it is also necessary to uphold the applicant's objection that the contested decision (as well as the judgment of the court of first instance) is unreviewable due to the omission of the allegations and evidence submitted by the applicant.
64. Pursuant to Sec. 157(2) of the Code of Civil Procedure, unless otherwise provided, the court shall state in the reasoning of the judgment what the claimant (applicant) has sought and on what grounds, and how the defendant (other party to the proceedings) has expressed its views on the matter, explain briefly and clearly which facts it considers proved and which it has not, on which evidence it has based its findings of fact and what considerations it has relied on when assessing the evidence, why it has not taken other evidence, what conclusion it has reached on the facts and how it has assessed the case in legal terms. It is not permissible to copy from the file the parties' submissions of fact and the evidence taken. The Court shall ensure that the reasons for the judgment are convincing. The reasons given in the written judgment must be consistent with the reasons of the judgment pronounced.
65. The issue of so-called omitted evidence has long been given particular attention by the Constitutional Court, and the general courts are obliged to respect the Constitutional Court's case-law on this issue in their decision-making [cf. Art. 89(2) of the Constitution of the Czech Republic].
66. The Constitutional Court, for example, in its judgment of 20 October 2005, Case No III. ÚS 139/05, interpreted and justified the legal opinion that the so-called omitted evidence, i.e., evidence that was not decided on by the court in the proceedings, or evidence that the court did not consider when proceeding in accordance with Sec. 132 of the Code of Civil Procedure (according to the principles of free evaluation of evidence), almost always establishes not only the unreviewability of the issued decision, but also its unconstitutionality. The procedure prescribed by law in the pursuit of a right (the principles of a fair trial) arising from the Charter [Article 36(1)] must be understood as meaning that, in conjunction with the general legal act (the Code of Civil Procedure), in proceedings before a court, a party must be given the opportunity to comment not only on the evidence taken [Art. 38(2) of the Charter] on the merits of the case, but also to identify (propose) the evidence which they consider necessary to establish (prove) their claims; this procedural right of a party corresponds to the obligation of the court not only to rule on the applications (including the applications for evidence) but also, if it does not grant them, to explain at least briefly in its decision why, for what reasons (usually in relation to the substantive rules of law it has applied and the legal conclusions it has reached on the factual basis of the case) it did not take the evidence proposed, or did not accept it as the basis for its findings of fact [Sec. 153 (1) and 157 (2) of the Code of Civil Procedure]. If the general court fails to do so, it not only burdens its decision with defects consisting in a violation of general procedural rules, but at the same time acts contrary to the principles expressed in Title V [in particular Art. 36(1) and 38(2)] of the Charter and, consequently, contrary to Art. 95(1) of the Constitution.
67. In the present case, the applicant claimed and submitted evidence on the question of the damage sustained in order (inter alia) to prove that the defendant's legislative inactivity affects him more severely than an ordinary citizen. In this connection, he stressed, inter alia, that, because of his professional and leisure activities, the unauthorised storage of his personal data weighed more heavily on him than on an ordinary citizen, that the possibility of misuse of the data so stored was not merely hypothetical but had occurred in the past (submitted Resolution of the District Court for Prague 5 of 2 March 2021, Case No 1 T 93/2020-775, which, according to the applicant, describes the unlawful practices of the members of the Police of the Czech Republic in the use of traffic and location data), he also identified evidence concerning the scope and possibility of using the stored data (these are “maps” covering ten days, which the applicant used to demonstrate how his movements during the day could be reconstructed retrospectively from the stored location data; which he also supplemented at the court's request) and described how the defendant's inactivity affected the way in which he communicates with his journalistic sources (through the interview conducted with the party).
68. However, the assessment of the evidence and of everything that came to light in the proceedings should logically be reflected in the reasoning of the judgment. The reasoning must show the relationship between the findings of fact and considerations in the assessment of the evidence, on the one hand, and the conclusions of law, on the other. A judgment which lacks the elements referred to in Sec. 157(2) of the Code of Civil Procedure has the consequence that it becomes unreviewable (cf., e.g., Supreme Court judgment of 17 January 2008, Case No 32 Odo 1091/2006). It must be borne in mind that the properly stated reasoning of the written form of judgment required by law is not merely a formal requirement designed to prevent the passage of judgments which are unjustified, unconvincing or perhaps vague or even incomprehensible, but is intended primarily to be a source of insight into the reasoning of the court of first instance (or the court of appeal), both with regard to the establishment of the facts of the case and its legal assessment. It should also be means of understanding the reasoning of the court of first instance (or the court of appeal) in assessing the evidence taken by it in the proceedings, its considerations and results in attributing the relevance of individual pieces of evidence, their (un)persuasiveness (e.g., in case of interrogation of witnesses) or the correctness of their source (in the case of documentary evidence), etc. (cf. Supreme Court judgments of 24 March 2010, Case No 30 Cdo 3655/2009; of 26 October 2011, Case No 30 Cdo 3155/2011; or of 9 May 2018, Case No 30 Cdo 1257/2018).
69. However, the court of first instance did not comply with the above-mentioned jurisprudential requirements if, according to the reasoning of its decision, it relied only on the newspaper articles written by the applicant, on the request for the removal of personal data addressed to T-Mobile Czech Republic a.s. of 7 October 2020, on the statement of the Office for Personal Data Protection of 9 March 2021 and on the applicant's interrogation. On that basis, the court of first instance then limited its findings of fact to the fact that the applicant works as a journalist and that he had contacted T-Mobile Czech Republic a.s. and the Office for the Protection of Personal Data prior to the commencement of the dispute with a request for redress. The decision thus lacks a reflection on the questioning of the applicant (which, according to the court of first instance, inter alia: “revealed that [...] the retention of traffic and location data is risky in that it is widespread. Thus, people who would like to communicate with journalists have concerns and, for that reason, there is limited or no communication with journalists on their part. [...] Technical measures to secure communication entail additional costs”, i.e., findings relevant to the factual conclusions regarding the damage sustained), and the consideration of the proposals for evidence by the resolution of the District Court for Prague 5 of 2 March 2021, Case No 1 T 93/2020-775 (on the issue of potential misuse of stored data), and the “maps” (on the question of the scope and possible use of personal data). It is not clear from the reasoning of the judgment whether the court of first instance took such evidence at all; if it did, what findings it drew from it; and if it did not take such evidence, for what reasons it did not do so. The reasoning of the decision of the court of first instance is therefore flawed and the applicant is to be agreed with that this part of the decision is unreviewable.
70. This error was not remedied by the court of appeal, which (as regards the applicant's objection that the court of first instance essentially failed to evaluate the documentary evidence taken at all, failed to draw reasoned conclusions on the allegations which are proved by the documentary evidence, omitted some of the documentary evidence, and failed to take some documentary evidence without any justification at all) merely concluded that: “the court of first instance made sufficient factual findings for its decision, based its decision on the correctly established facts of the case, and correctly assessed the case in legal terms.” The court of appeal's most intense disagreement with the above-mentioned objections raised in the appeal is then found in paragraph 17 of the contested decision, in which it states that the claimant “has not alleged or proved anything regarding how the specific manner and intensity of the infringement of these rights affected his personal sphere”. Such a conclusion cannot be drawn without first dealing with the applicant's objections concerning the defects in the evidence in the proceedings before the court of first instance. The court of appeal also failed to fulfil its obligation to give proper reasons for its decision in this respect and to deal adequately with the arguments put forward by the parties (cf., e.g., the Constitutional Court judgment of 10 December 2014, Case No IV ÚS 919/14, paragraph 13, and the case-law cited therein; or the Supreme Court judgment of 15 July 2015, Case No 28 Cdo 4458/2014).
On the Need to Submit a Preliminary Reference to the Court of Justice and the Subsequent Procedure of the Courts
71. The Supreme Court, aware of its obligation under Art. 267 TFEU to submit a preliminary reference to the Court of Justice if a (so-called preliminary) question of interpretation of acts adopted by the institutions of the European Union arises in the proceedings before it, finally examined whether such an obligation also arose in the present case.
72. In terms of the obligation of a court of a Member State, whose decision cannot be challenged by any judicial remedy under national law, to submit a reference for a preliminary ruling to the CJEU, there is a key judgment of the Court of Justice of 6 October 1982, Case 283/81, Srl CILFIT and Lanificio di Gavardo SpA v Ministero della sanità, in which the Court of Justice formulated three exceptions in which national courts of last instance do not have that obligation, namely if:
a) the question of EU law is not relevant to the resolution of the case;
b) there is established case-law of the Court of Justice on the issue in question or a judgment of the Court of Justice on an essentially identical issue (so-called acte éclairé);
c) the only correct application of Union law is so obvious as to leave no room for any reasonable doubt (so-called acte clair). In order for a court of a Member State to find that the interpretation of EU law is obvious, it must (a) compare the different language versions of the text, (b) apply the terminology and legal terms of EU law, (c) take account of the differences in the interpretation of EU law, and (d) be satisfied that its interpretation is equally obvious to the courts of the other Member States and to the Court of Justice of the European Union.
73. Except in the cases referred to above, the national courts of the Member States which rule at last instance do not have to refer a question to the Court of Justice for a preliminary ruling where there are grounds of inadmissibility relating to the proceedings before the national court, provided that the principles of equivalence and effectiveness are complied with (cf., CJEU judgments of 14 December 1995, in Joined Cases C-430/93 and C-431/93, van Schijndel and van Veen, paragraph 17; of 15 March 2017, Case C-3/16, Aquino, paragraph 56; or of 6 October 2021, Case C-561/19, Consorzio Italian Management e Catania Multiservizi, paragraph 61).
74. In the present case, the Supreme Court did not find it necessary to refer the matter to the Court of Justice for preliminary ruling at this stage of the proceedings, since the preliminary reference raised by the applicant as to the conformity of the national legislation with EU law is not relevant to the resolution of the case at this stage of the proceedings, since this decision does not definitively resolve the question of infringement of EU law.
75. The court of appeal, as well as the court of first instance, rejected the claim for reasons unrelated to the above-mentioned issue; they did not address this issue at all for the time being (although, correctly, they should have done so). For this reason, however, the final resolution of the question of infringement of EU law cannot be the subject of an extraordinary appeal review, since the Supreme Court is a court of sole review competences and therefore cannot be the first court in these proceedings to make a corresponding legal assessment of the disputed question of infringement of EU law (cf. Supreme Court judgments of 31 January 2023, Case No 23 Cdo 3114/2021; of 27 November 2019, Case No 32 Cdo 6012/2017; or of 7 December 2015, Case No 32 Cdo 4421/2013). In the context of a cassation decision, although the Supreme Court may oblige the lower courts to deal with a legal issue not yet resolved by them in the subsequent proceedings, it should not, as a matter of principle, at the same time give its own assessment of that issue; inter alia, because for the assessment of a “new” issue, corresponding “new” procedural activity of the parties to the dispute may also be relevant, including the submission of additional arguments or evidence, which, however, are, in principle, not permissible in proceedings on extraordinary appeal. Thus, the above, taken together, means that, given the current procedural situation, the CJEU's response, whatever it may be, would have no effect on the grounds for cassation of the judgments of the lower courts.
76. In the subsequent proceedings, the general courts will thus have to deal with the question of the conformity of the national legislation on mandatory collection and retention of traffic and location data and the requirements arising from EU law. In this regard, the Supreme Court recalls that the court must explain its legal considerations sufficiently in its reasoning, citing published case-law (or opinion of legal science) where appropriate. Where a party to the proceedings argues on the basis of the opinions of legal science or case-law, the general court must deal with the opinions contained in those sources in a properly reasoned manner, including by explaining why it does not consider them to be relevant to the case in question (which the courts in the present proceedings should also have done in relation to the question of the State's liability for legislative activity, since the special regime under EU law in that respect was already referred to by the applicant in the original application, including a proper citation of the relevant case-law in his action). Only in this way can the reasoning of the court's decision be convincing and only in this way can it legitimise the decision itself in that the correct interpretation of the law is precisely the interpretation chosen by the court (cf., e.g., Constitutional Court judgment of 17 August 2005, Case No I. ÚS 403/03; or Supreme Court judgments of 20 June 2018, Case No 30 Cdo 4754/2017; and of 3 December 2009, Case No 30 Cdo 2811/2007). In the subsequent proceedings, the courts will thus have to deal in detail with the decision-making practice of the Court of Justice. If there is relevant case-law of the Court of Justice on a certain issue, which is binding on national courts, such case-law must be relied upon (without the need to ask the Court of Justice again for an interpretation of the same or similar issue if the existing case-law provides sufficient answers applicable to the proceedings at hand).
77. In its judgment of 8 April 2014, in Joined Cases C-293/12 and C-594/12, Digital Rights Ireland Ltd, the Court of Justice rendered invalid the Directive 2006/24/EC of the European Parliament and of the Council of 15 March 2006 on the retention of data generated or processed in connection with the provision of publicly available electronic communications services or of public communications networks and amending Directive 2002/58/EC, which provided the legal basis for the retention of traffic and location data (and on which the Electronic Communications Act, which is still in force, is based). In that decision, the Court of Justice clearly emphasized that the Directive, which it subsequently rendered invalid, constituted a very extensive and particularly serious interference with the fundamental rights enshrined in Art. 7 and 8 of the EU Charter, without such interference being precisely defined by provisions enabling it to ensure that it was indeed limited to the minimum necessary. Thus, the Directive did not provide for sufficient safeguards to ensure effective protection of the stored data against the risk of misuse and against any unauthorised access to and unlawful use of the data, as is required by Art. 8 of the EU Charter.
78. The effects of the invalidity of this Directive have subsequently been clarified by the Court of Justice in a series of decisions, which include, in particular, the following:
79. Firstly, EU law precludes such legislative measures which, for the purposes of combating serious crime and preventing serious threats to public security, provide for the preventive retention of traffic and location data on a general and indiscriminate basis (cf. CJEU judgments of 21 December 2016, in Joined Cases C-203/15 and C-698/15, Tele2 Sverige, paragraphs 97–112; of 6 October 2020, Case C-511/18, C-512/18 and C-520/18, La Quadrature du Net, paragraphs 141–142; of 6 October 2020, Case C-623/17, Privacy International, paragraph 59; of 2 March 2021, Case C-746/18, Prokuratuur, paragraph 30; of 5 April 2022, Case C-140/20, Commissioner of An Garda Síochána, paragraphs 65–66; of 20 September 2022, in Joined Cases C-793/19 and C-794/19, SpaceNet and Telekom Deutschland, paragraphs 74 and 131; of 20 September 2022, in Joined Cases C-339/20 and C-397/20, VD and SR, paragraphs 92 and 93; of 17 November 2022, Case C-350/21, Spetsializirana prokuratura, paragraphs 42 and 43; or of 7 September 2023, Case C-162/22, Lietuvos Respublikos Generalinė prokuratūra, paragraph 31).
80. At the same time, in the case of general and indiscriminate retention of traffic and location data, neither the strict setting of obligations on providers of electronic communications services can ensure the security and protection of the data they retain, nor can national legislation ensuring full compliance with the conditions of access to the stored data resulting from the case-law interpreting the Directive 2002/58/EC (including the establishment of bodies called upon to supervise such retention) limit or even remedy the serious interference with the rights guaranteed by Art. 5 and 6 of the Directive 2002/58/EC and the fundamental rights embodied in those articles which would result from the general retention of such data provided for by national legislation (cf. CJEU judgment of 17 November 2022, Case C-350/21, Spetsializirana prokuratura, paragraphs 58 and 59).
81. Thus, according to the CJEU, the general and indiscriminate retention of traffic and location data is permissible only in situations where the State is confronted with a serious threat to national security that is shown to be genuine and present or foreseeable, and the instruction for such retention must be issued only for the period strictly necessary, but with the possibility of extension, and the decision to impose such an instruction can be subject to effective review by a court or an independent administrative authority (cf. CJEU judgments of 6 October 2020, Cases C-511/18, C-512/18 and C-520/18, La Quadrature du Net, paragraph 168; of 20 September 2022, in Joined Cases C-793/19 and C-794/19, SpaceNet and Telekom Deutschland, paragraph 72; or of 5 April 2022, Case C-140/20, Commissioner of An Garda Síochána, paragraph 58).
82. On the other hand, the Directive 2002/58/EC does not preclude the targeted retention of traffic and location data which is defined on the basis of objective and non-discriminatory factors by categories of persons concerned or using a geographical criterion, but for a strictly necessary period, which may be extended, nor does it preclude the possibility of ordering, by a decision of the competent authority that is subject to effective judicial review, providers of electronic communications services to carry out, for a specified period, the expedited retention of traffic and location data in their possession (cf. CJEU judgments of 20 September 2022, in Joined Cases C-793/19 and C-794/19, SpaceNet and Telekom Deutschland, paragraph 75; or of 7 September 2023, Case C-162/22, Lietuvos Respublikos Generalinė prokuratūra, paragraph 31).
83. In the subsequent proceedings, it will thus be for the court of first instance to assess how the Czech national legislation contested by the applicant corresponds to or, on the contrary, contradicts the above-mentioned case-law conclusions. Given that this issue has not yet been the subject of the proceedings, it will also be necessary to give the parties the opportunity to supplement their arguments on this issue [even after an instruction pursuant to Sec. 118a(1) and (3) of the Code of Civil Procedure].
84. Finally, the fact that the Constitutional Court dismissed the motion to annul the relevant provisions of the Electronic Communications Act and the Police Act in its judgment of 14 May 2019, Case No Pl. ÚS 45/17, will not be decisive for the conclusion that the national legislation is inconsistent with the EU law. The reference framework for the Constitutional Court's review remains to be the norms of the Czech constitutional order even after the Czech Republic's accession to the European Union (cf. Constitutional Court judgments of 8 March 2006, Case No Pl. ÚS 50/04; of 16 January 2007, Case No Pl. ÚS 36/05; or of 29 November 2011, Case No II. ÚS 1658/11; or Supreme Court judgment of 26 June 2019, Case No 30 Cdo 3378/2018), since the task of the Constitutional Court is to protect constitutionality (Art. 83 of the Constitution) in both its aspects, i.e., both the protection of objective constitutional law and subjective, i.e., fundamental rights. It follows that EU law is not a reference criterion for assessing the constitutionality of a national provision and that even a genuinely established inconsistency between a directive and a statute cannot, in itself, lead to the annulment of the statutory provision in question; although it is possible to support the justification of unconstitutionality before the Constitutional Court by means of arguments justifying such a finding if it consists in a violation of the constitutional order (cf. the above-mentioned Constitutional Court judgment, Case No Pl. ÚS 36/05; or the Constitutional Court judgment of 24 February 2015, Case No I. ÚS 1868/14). It should not be overlooked that in paragraphs 74 and 79 of the above-mentioned judgment, Case No Pl. ÚS 45/17, the Constitutional Court implicitly acknowledges the inconsistency with Directive 2002/58/EC.
85. Thus, the review of the unconstitutionality of the provisions of a statute by the Constitutional Court is inherently different (narrower) than the review of the conformity of these national provisions with EU law by the general courts, and the conclusion on the one does not imply a conclusion on the other.
86. In the event that the court concludes in the subsequent proceedings that the national legislation in question does not comply with the terms of Directive 2002/58/EC as interpreted by the Court of Justice, it will be necessary to examine, in the light of the above-mentioned decision of the CJEU in Brasserie du pêcheur SA, Factortame Ltd and Others, whether the infringement was sufficiently serious (on the criteria for the seriousness of an infringement of EU law, see above, including the case-law cited).
87. In exceptional cases, the incorrect implementation of a directive does not have to constitute a particularly serious infringement (cf., e.g., the CJEU judgment of 26 March 1996, Case C-392/93, British Telecommunications, in which the Court of Justice concluded that there was no particularly serious infringement because, on the one hand, the directive itself was imprecisely worded and could be interpreted in several ways, and the incorrect interpretation chosen was reasonably defensible and shared by other Member States, and, on the other hand, there was no interpretation of the problematic provision by the Court of Justice). However, if the provisions of an incorrectly implemented directive are sufficiently clear, or if their interpretation has been clarified by the Court of Justice, such an infringement must be regarded as a particularly serious breach of EU law (cf., e.g., CJEU judgments of 21 December 2023, Case C-86/22, Papier Mettler Italia Srl, paragraphs 86–90; of 25 November 2010, Case C-429/09, Günter Fuß, paragraphs 51–58; of 16 October 2008, Case C-452/06, Synthon, paragraphs 37–46; or of 18 January 2001, Case C-150/99, Stockholm Lindöpark, paragraphs 37–42). It is thus a concretisation of the general conclusion that an infringement of EU law is sufficiently serious where it has been committed in manifest disregard of the case-law of the Court of Justice in the area concerned (cf. the above-mentioned judgment of the CJEU in Köbler; and also, for example, CJEU judgments of 13 June 2006, Case C-173/03, Traghetti del Mediterraneo SpA, paragraph 43; or of 26 July 2019, Case C-620/17, Hochtief Solutions, paragraph 43).
88. Since, in the light of the interpretation given above, the contested judgment of the court of appeal is incorrect and since there are no conditions for discontinuing the proceedings on extraordinary appeal, for rejecting the extraordinary appeal, for dismissing the extraordinary appeal and (in particular, in view of the need to supplement the evidence) for changing the judgment of the court of appeal, the Supreme Court annuls the judgment to the extent necessary [Sec. 243e(1) of the Code of Civil Procedure]. Since the reasons for which the judgment of the court of appeal was annulled also apply to the judgment of the court of first instance, the Supreme Court also annuls this decision and refers the case back to the court of first instance for further proceedings [Sec. 243e(2), second sentence, Code of Civil Procedure]. The part of the extraordinary appeal which was directed against the dismissal of the action seeking an apology to the citizens was not found admissible and the Supreme Court therefore rejected it pursuant to Sec. 243c(1) of the Code of Civil Procedure.
89. The legal opinion expressed in this judgment is binding on the lower courts; in the new decision on the case, it will also be necessary to decide on the costs of the proceedings on extraordinary appeal [Sec. 226(1) and 243g(1), first part of the sentence after the semicolon and the second sentence of the Code of Civil Procedure].
Instruction on the admissibility of remedial measures: No legal remedy is admissible against this decision.
In Brno, 27 March 2024
David Vláčil
President of the Panel