When is legal representation mandatory?

Mandatory legal representation is not only available in litigation. In addition to a significant part of court proceedings, our legal system requires the involvement of a lawyer, for example in real estate or company matters, but also in certain cases of family law or bankruptcy and liquidation. This article summarises the cases in which legal representation is mandatory.

MANDATORY LEGAL REPRESENTATION IN LITIGATION

The criminal, civil and administrative procedural codes all determine when legal representation is mandatory in a given legal proceeding.

Mandatory legal representation in criminal proceedings

The participation of a lawyer in criminal proceedings is mandatory if.

• the offence is punishable by law with imprisonment of up to five years or more,
• the suspected person or the person reasonably suspected of having committed the offence is under a custodial measure involving personal liberty, is under arrest in other cases, is under compulsory treatment, is serving a prison sentence, is under detention or is in a reformatory,
• the suspected or accused person is deaf, deafblind, blind, speech impaired, otherwise incapable of communicating or severely incapacitated, or, regardless of his or her mental capacity, mentally defective,
• the suspect or the person reasonably suspected of committing the offence does not know Hungarian,
• the accused or the person reasonably suspected of having committed the offence is otherwise unable to defend himself or herself in person,
• the court, prosecutor’s office or investigating authority has appointed a defence counsel on the motion of the accused or of a person reasonably suspected of having committed the offence, or because it considers it necessary for other reasons,
• this Act makes specific provision in this regard.

Mandatory legal representation in civil proceedings

In principle, legal representation is mandatory in litigation, unless otherwise provided by law. Unless otherwise provided by law, legal representation is not mandatory for the opposing party in proceedings within the jurisdiction of the district court, including appeal and review proceedings, or in review proceedings in connection with proceedings within the jurisdiction of the district court.

The district court has jurisdiction in the following cases:

• property lawsuits the value of the subject matter of which does not exceed HUF 30 million or in which the value of the claim based on the property right cannot be determined, except
  • copyright, related rights and industrial property litigation,
  • actions for damages or compensation in respect of the exercise of official authority,
  • public interest litigation,
  • litigation relating to the establishment and legal operation of legal persons,
  • legal proceedings between legal persons and their members or former members, or between members or former members and each other, based on membership,
  • actions concerning the liability of members and representatives of legal persons based on their membership or representation,
  • lawsuits relating to rights deriving from securities,
  • international cargo and international freight forwarding litigation,
• litigation concerning personal status,
• enforcement actions.

This means that legal representation is mandatory in the following cases of civil litigation:

• if the Court of First Instance acts as a court of first instance (but legal representation is not mandatory in labour disputes),
• at second instance, in proceedings before the General Court or the Court of Appeal,
• in appeal or review proceedings before the Curia.

Mandatory legal representation in administrative proceedings

Mandatory legal representation in administrative proceedings

• before the Curia,
• in cases where the Metropolitan Court has exclusive jurisdiction:
  • with the exception of a civil service dispute, a dispute which
    • unless otherwise provided by law, the autonomous regulatory body, the autonomous public administration body and the General Government Office,
    • the railway administration,
    • the aviation authority and
    • the Hungarian National Bank

administrative activities,

• a dispute concerning access to classified information, and
  • disputes relating to the administrative activities of the public body, its organs or officers, disputes between the organs or officers of the public body, and disputes between the public body, its organs or officers and the body exercising control or supervision over the public body.
• in a case concerning an administrative contract.

IN WHAT OTHER CASES IS LEGAL REPRESENTATION MANDATORY?

The rules for concluding a contract are set out in the Civil Code, in the contract law section. Most people don’t realise that even the simplest shopping in a shop is a contract. The seller sells and the buyer buys the goods, and the contract is concluded orally between them. These are what are known as ordinary or everyday transactions. In addition to these, both the Civil Code and other legislation provide for certain types of transactions where legal representation is mandatory.

Prior declaration of rights

For future partial or total restriction of the capacity of an adult to act

• may name one or more persons whom you propose to appoint as guardian;
• may exclude one or more persons from being a trustee; and
• may determine how the guardian should act in certain personal and property matters.

A prior declaration of rights is not a contract, but a unilateral declaration of rights. However, it is special in that if the declarant does not make the declaration before the guardianship authority, it can only be made in a public deed or a private deed countersigned by a lawyer. This means that neither a deed with two witnesses nor a handwritten deed is admissible in this case.

Formation and amendment of companies and cooperatives

This is one of the most typical and widely known cases of when legal representation is mandatory. According to the Civil Code, the articles of association of a company or the statutes of a cooperative must be recorded in a notarial deed or in a private deed countersigned by a lawyer or a legal adviser of one of the founding chambers.

Legal representation is also mandatory before the Court of Registration when companies are incorporated or amended.

Spousal/common-law maintenance or child support with a lump-sum allowance

The spouses/partners or parents may agree in a deed or a private deed countersigned by a lawyer that the spouse/partner or parent who is obliged to pay maintenance will fulfil the maintenance obligation by a one-off payment of an appropriate sum of money or property.

Contracts between spouses

Contracts of sale, exchange, gift or loan concluded between spouses during the common-law partnership and the acknowledgement of debts between spouses are valid if they are recorded in a public deed or a private deed countersigned by a lawyer. This does not apply to a normal gift of movable property if the gift has been transferred.

Division of matrimonial community property

If the spouses divide the community property by contract, the contract is valid if it is recorded in a public deed or a private deed countersigned by a lawyer. This does not apply to the division of movable property forming part of the community property, if the division has been executed.

Marital or civil partnership property contract

A marriage or civil partnership contract is valid if it is recorded in a public deed or a private deed countersigned by a lawyer.

Prior contractual arrangements for the use of the dwelling

Married couples or spouses/partners can arrange the use of the common home in the event of divorce or termination of cohabitation by means of a prior contract. The contract is valid if it is recorded in a public deed or a private deed countersigned by a lawyer.

Parent’s sole right as trustee

Parents exercising joint parental authority may grant each other, either mutually or separately, a power of attorney to manage the child’s property on behalf of one parent. The power of attorney is valid if it is contained in a public instrument or a private instrument countersigned by a lawyer.

Matters concerning the land registry

Apart from business matters, real estate is another area where practically everyone remembers that legal representation is mandatory in real estate contracts. Contracts of sale, gifts, maintenance or usufruct, land, the creation of a condominium – these are the types of real estate matters most frequently encountered in everyday life and known to most people, for which the involvement of a lawyer is essential.

Legal representation must be provided in proceedings brought on request in which the registration of the change of rights is based on a notarial deed or a private document countersigned by a lawyer or a chamber counsel.

Bankruptcy and liquidation proceedings

The head of the debtor business entity may apply to the court for bankruptcy proceedings. The debtor must be legally represented in order to file the application.

In proceedings opened at the request of a debtor, creditor or liquidator in winding-up proceedings, the applicant is required to be represented by a legal representative in relation to the lodging of the application.