In the case of Fuklev v. Ukraine,
The European Court of Human Rights (Second
Section), sitting as a Chamber composed of:
Mr J.-P.
Costa, President,
Mr I. Cabral Barreto,
Mr K. Jungwiert,
Mr V. Butkevych,
Mr M. Ugrekhelidze,
Mrs A. Mularoni,
Mrs E. Fura-Sandström,
judges,
and Mr S. Naismith,
Deputy Section Registrar,
Having deliberated in private on 19 May 2005,
Having regard to the observations submitted by
the parties,
Delivers the following judgment, which was
adopted on that date:
PROCEDURE
1. The case originated in an
application (no. 71186/01) against Ukraine lodged with the Court under Article
34 of the Convention for the Protection of Human Rights and Fundamental
Freedoms (“the Convention”) by a Ukrainian national, Mr Petr Petrovich Fuklev
(“the applicant”), on 10 February 2001.
2. The Ukrainian Government
(“the Government”) were represented by their Agents, Ms Valeria Lutkovska and
subsequently Ms Zoryana Bortnovska.
3. The application was allocated to
the Second Section of the Court (Rule 52 § 1 of the Rules of Court).
Within that Section, the Chamber that would consider the case (Article 27 § 1
of the Convention) was constituted as provided in Rule 26 § 1.
4. The applicants’ complaints
under Article 6 § 1 and Article 13 of the Convention were communicated to the
respondent Government on 7 July 2003. On the same date the Court
decided that Article 29 § 3 of the Convention should be applied and the
admissibility and merits of the complaint be considered together.
5. The applicant and the Government
each filed observations on the admissibility and merits of the application (Rule
54A).
THE FACTS
6. The applicant was born in 1935
and lives in Berdiansk. He is a former employee of a Joint Stock Company, the
Iskra Brick Factory (“the IBF”). He worked at the IBF from 1 December 1996 to 24 November 1997, when he was dismissed from his position as a senior engineer at his
own request. At the time of his dismissal the applicant was not paid the wages
owed to him.
I. THE CIRCUMSTANCES OF THE CASE
A. Bankruptcy of the Iskra Brick
Factory
7. In March 1997 a construction
company, the Closed JSC Donetskzhelezobetonmontazh (hereafter the CJSC), instituted
bankruptcy proceedings against the IBF on account of its failure to comply with
contractual obligations.
8. The bankruptcy proceedings were
initiated on 8 April 1997 by the Zaporizhzhia Regional Arbitration Court (“the
ZRAC”). The applicant acted in these proceedings as a representative of the
IBF.
9. On 20 August 1997 the ZRAC declared the IBF bankrupt. It also established a liquidation commission to manage its
debts. The liquidation commission consisted of representatives of the Berdiansk
State Municipal Council, the Berdiansk State Tax Inspectorate, the Financial
Department of the State Municipal Council, the Ukrayina Bank (a State-owned
bank) and the CJSC. The liquidators were obliged to elect the chairman and
members of the liquidation commission within a period of ten days.
10. On 23 September 1997 the commission made an inventory of the IBF’s property.
11. On 16 January 1998 the liquidation commission elected Mr Bogushko as its chairman.
12. Between October 1998 and 14 December 2000, in accordance with the submissions of the parties, the liquidation commission
was not in operation.
13. On 5 October 1998 the then chair of the liquidation commission, Ms Chulkova, resigned.
14. On 14 December 2000 the liquidation commission elected Mr Fenenko as its chairman.
15. On 19 January 2001 the President of the ZRAC decided that the bankruptcy proceedings concerning the IBF should
be referred from Judge A.E. Kuznetsov for consideration by another judge (Judge
V.G. Serkiza).
16. On 19 November 2001 the
President of the Zaporizhzhia Regional Commercial Court (the “ZRCC”, former
Zaporizhzhia Regional Arbitration Court as renamed in 2001 as a result of “small
judicial reform”), decided that the bankruptcy proceedings concerning the IBF
should be referred for consideration from Judge V.G. Serkiza to another
judge (Judge L.P. Turkina).
17. On 22 March 2002 the ZRCC found that the liquidation commission appointed in 1997 had deviated from its duties.
It also informed the members of the liquidation commission that they had
incurred criminal liability for failure to comply with the judgments and
decisions of the domestic courts.
18. On 22 March, 10 April and 3 June 2002, the ZRCC requested the liquidation commission to submit a report on the
results of the operation.
19. On 2 April 2002 the liquidation commission elected a new chairman, Mr Otryshko. The commission discussed
the proposal for the friendly settlement of the IBF’s debts. The new chairman
of the commission submitted a report to the ZRCC that made no reference to the IBF’s
salary debts.
20. On 21 May 2002 the IBF’s shareholders agreed to enter into a friendly settlement with the creditors.
21. On 2 July 2002 the liquidation commission decided to conclude a friendly settlement in the bankruptcy
proceedings pending against the IBF.
22. On 3 July 2002 the ZRCC held a hearing with a view to discussing the possible friendly settlement and the
report by the liquidation commission. The hearing was adjourned until 23 July 2002.
23. On 23 July 2002 the ZRCC terminated the bankruptcy proceedings concerning the IBF by way of a friendly
settlement between the IBF and its creditors (the CJSC and the Berdiansk State
Tax Inspectorate).
B. Enforcement proceedings in the
applicant’s case
24. In January 1998 the applicant
instituted proceedings in the Berdiansk City Court (the “Berdiansk Court”)
against the IBF, seeking the recovery of salary arrears.
25. On 24 February 1998 the Berdiansk Court allowed the applicant’s claims and ordered the IBF to pay him 2,080.38
Ukrainian hryvnas (UAH).
26. In April 1998 the applicant
instituted proceedings in the Berdiansk Court, seeking compensation for the
delay in the payment of salary arrears awarded to him by the decision of 24 February 1998. On 6 May 1998 the Berdiansk Court rejected his claims as being
unsubstantiated. On 4 June 1998 the Zaporizhzhia Regional Court
upheld that decision.
27. On 22 May 1998 the Bailiffs’ Service of the Berdiansk Court served notice on the IBF to pay the applicant the
sums due.
28. On 6 May 1998 the Berdiansk Court rejected the applicant’s additional claims for compensation for the delay in
payment of salary arrears as it was unsubstantiated. That judgment was upheld
on 4 June 1998 by the Zaporizhzhia Regional Court.
29. On 22 May 1998 the Berdiansk Court’s bailiffs (“the court bailiffs”) instituted enforcement proceedings in the
case and requested the IBF to pay the applicant the sum due.
30. On 28 May 1998 the court bailiffs requested the IBF to provide correct information as to its bank accounts, so that
the sums due the applicant could be procured.
31. A resolution to initiate
enforcement proceedings in the case was issued by the Berdiansk City Bailiffs’
Service (the “bailiffs”) on 5 March 1999, following the transfer of
jurisdiction for the enforcement from the court bailiffs.
32. On 8 April 1999 the bailiffs informed the applicant that the judgment could not be executed immediately on
account of the entry into force of the new Enforcement Proceedings Act and the
referral of all the enforcement proceedings from the jurisdiction of the courts
to the jurisdiction of the Bailiffs Service of the Ministry of Justice.
33. On 22 April 1999 the bailiffs initiated enforcement proceedings in the case.
34. On 20 April 2000 the bailiffs informed the applicant that a request had been sent to the ZRAC on 20 March 2000 concerning the inactivity of the liquidation commission. It also stated that
no response had been received from the ZRAC.
35. On 24 May and 14 September 2000 the bailiffs informed the applicant that the writ of execution could not
be sent to the liquidation commission as the commission did not exist de
facto. It also informed the applicant that the writs of execution issued by
the Berdiansk Court had only been received on 22 April 1999 by the bailiffs.
36. On 17 July and 28 October 2000 the applicant complained about the non-enforcement of a judgment in his
favour to the General Prosecution Service and the Ministry of Justice. On 6 November 2000 the General Prosecution Service transmitted his complaints to the Higher
Commercial (formerly Arbitration) Court (“the HCC”). On 18 January 2001 the HCC forwarded his complaints to the ZRAC for a reply.
37. On 31 January 2002 the bailiffs informed the applicant that the most recent chair of the liquidation commission
was Ms I. Chulkova. They also stated that, in accordance with section 65 of the
Enforcement Proceedings Act, writs of execution had to be transferred to the
liquidation commission from the bailiffs.
38. On 4 February 2002 the bailiffs suspended the enforcement proceedings until the election of a new chairman of
the liquidation commission and the formation of a new commission.
39. On 10 June 2002 the Berdiansk District Council of the Zaporizhzhia Region informed the bailiffs about the
membership of the liquidation commission and its chairman (Mr Otryshko). This
information was to be provided to the applicant.
40. On 27 June 2002 the bailiffs terminated the enforcement proceedings pending before them in the applicant’s case by
transmitting the writs of execution to the liquidation commission for the IBF.
41. On 31 July 2002 the applicant complained to the bailiffs about the failure to enforce the judgment.
42. On 13 August 2002 the bailiffs informed the applicant that they were no longer responsible for the enforcement
of the judgment of 24 February 1998.
43. In September 2002 the judgment
of 24 February 1998 was partly enforced by the liquidation commission and the
applicant was paid UAH 1,000
in compensation.
44. On 28 October 2002 the applicant complained to the ZRCC about the failure to enforce the judgment in his favour. By
a letter of 13 November 2002, a judge of the ZRCC informed the
applicant of the friendly settlement in the case. She also stated that the
applicant could not be considered a creditor of the IBF as he had not applied
to the court in the course of the IBF bankruptcy proceedings to be declared a
creditor. She also refused to provide him with documents concerning the
bankruptcy proceedings in the case.
45. On 20 December 2002 the applicant lodged complaints with the HCC concerning the failure to pay his salary arrears
and the inactivity of the liquidation commission and the bailiffs. On 18 February 2003 the HCC informed the applicant that his complaints had been forwarded to
ZRCC for a reply.
46. On 5 March 2003 the applicant lodged complaints with the ZRCC, seeking a declaration that he was a creditor of
the IBF and an order requiring the IBF to enforce the judgment of 24 February 1998. He also sought a declaration that the friendly settlement reached by the
IBF and its creditors was unlawful. By a letter of 18 April 2003, the ZRCC informed the applicant that, as he had failed to lodge a request to be recognised
as a creditor during the bankruptcy proceedings in the case (April 1997 – July
2002), he could not claim to be a creditor and could not therefore seek to have
the friendly settlement declared unlawful.
C. Court proceedings against the bailiffs
47. On 26 November 2001 the applicant lodged complaints with the Berdiansk Court, seeking a declaration that the
inactivity of the Head of the State Execution Service Department was unlawful in
view of his failure to enforce the judgment of 24 February 1998.
48. On 28 November 2001 the complaint was left without consideration for failure to comply with the formalities
prescribed by law.
49. On 25 December 2001 the applicant again lodged a complaint with the Berdiansk Court against the bailiffs, seeking
to have their failure to enforce the judgment of 24 February 1998 declared unlawful. In December 2001 the Berdiansk Court rejected this complaint on
account of the applicant’s failure to comply with the requirements as to its form
and content. The applicant was allowed ten days to rectify the matter.
50. On 8 January 2002 the applicant resubmitted his complaint.
51. On 20 March 2002 the Berdiansk Court rejected his complaints as being lodged out of time.
52. On 11 June 2002 the Zaporizhzhia Regional Court of Appeal (the “Court of Appeal”) quashed that decision and
remitted the case to the same court for a fresh consideration.
53. On 6 September 2002 the applicant lodged additional complaints with the Berdiansk Court, seeking the annulment
of the bailiffs’ resolution of 27 June 2002 on the termination of the
enforcement proceedings.
54. The proceedings concerning the
failure of the bailiffs to act and the resolution on terminating the
enforcement proceedings were disjoined, forming two separate proceedings: case
no. 2-973/2002 and case
no. 2-1378/2002.
55. On 20 November 2002 the Berdiansk Court found in favour of the applicant in the first case (no. 2-973/2002). It
also declared unlawful the failure of the bailiffs to enforce the judgment for
a lengthy period (four years and nine months) and found the applicant’s
complaints to be substantiated. The applicant appealed against this decision as
he thought that a mere acknowledgment of the fact that the bailiffs had acted
unlawfully was not sufficient to rectify the situation. On 24 April 2003 the Court of Appeal upheld the judgment given on 20 November 2002 and dismissed the applicant’s appeal.
56. On 20 November 2002 the Berdiansk Court dismissed the applicant’s claims concerning the allegedly unlawful
termination of the enforcement proceedings in his second case as being
unsubstantiated (case no. 2-1378/2002). The applicant appealed to the
Court of Appeal, seeking the resumption of the enforcement proceedings and an
extension of the time allowed for lodging an appeal. On 5 May 2003 the Court of Appeal quashed the judgment of 20 November 2002 and did not consider the applicant’s complaints as they had been lodged out of time (section 39 of the
Enforcement Proceedings Act).
57. On 15 May 2003 the applicant requested the Berdiansk Court to extend the time for considering his complaints
against the bailiffs’ resolution of 27 June 2002 on terminating the enforcement proceedings in his second case (no. 2-1378/2002). In particular, he alleged
that the delay in lodging his complaints was due to the fact that he had received
the resolution of 27 June 2002 in a version that was illegible (it was sent
to him twice, on 23 July and 6 August 2002). He had lodged his
complaints only on 6 September 2002 as he could not read the documents
supplied to him by the bailiffs, which were allegedly of a very poor quality.
He has not given the Court any further information as to the outcome of these
proceedings.
58. On 19 August 2003 the applicant lodged a cassation appeal against the ruling of 24 April 2003 in the first case (no. 2-973/2002).
59. On 20 April 2004 the Registry of the Supreme Court informed the applicant that his appeal had been received. It
also stated that it was pending for consideration before the Supreme Court.
60. On 1 November 2004 a panel of three judges of the Supreme Court dismissed the applicant’s appeal as it found no
infringements of the rules of substantive or procedural law. It also found that
there were no grounds for remitting the appeal for consideration by the Chamber
of the Supreme Court.
THE LAW
61. The applicant complained about
the State authorities’ failure to execute the judgment of 24 February 1998 against the Iskra Brick Factory in due time. He relied on Article 6 § 1 of the
Convention, which in so far as relevant provides:
“In the determination of his civil rights and
obligations ..., everyone is entitled to a fair and public hearing ... by an
independent and impartial tribunal established by law.”
62. The applicant further alleged
that the failure to enforce the judgment in his favour constituted an
infringement of Article 13 of the Convention, which reads:
“Everyone whose rights and freedoms as set
forth in [the] Convention are violated shall have an effective remedy before a
national authority notwithstanding that the violation has been committed by
persons acting in an official capacity.”
63. The applicant also alleged that
Article 1 of Protocol No. 1 to the Convention had been infringed as a judgment
in his favour had not been enforced for a lengthy period of time. This
provision reads as follows:
“Every natural or legal person is entitled to
the peaceful enjoyment of his possessions. No one shall be deprived of his
possessions except in the public interest and subject to the conditions
provided for by law and by the general principles of international law.
The preceding provisions shall not, however,
in any way impair the right of a State to enforce such laws as it deems
necessary to control the use of property in accordance with the general
interest or to secure the payment of taxes or other contributions or
penalties.”
I. ADMISSIBILITY
A. Admissibility ratione personae
64. The Government submitted that
the IBF was a separate legal entity that did not belong to the State and was
not effectively controlled or managed by the State. They further submitted that
the biggest share in the enterprise - 44% - belonged to the collective
agricultural enterprise “Iskra” (колгосп
“Іскра”), which was also a private legal
entity, and that the State held only 13.4% of the IBF’s shares.
65. They further submitted that the
liquidation commission had been appointed by the Regional Commercial Court and had
acted independently of the State authorities, as it had been appointed by an
independent judicial body. They further pointed out that the State had no right
to interfere in bankruptcy proceedings concerning a private company.
66. The applicant disagreed. In
particular, he stated that the liquidation commission appointed by the Regional
Commercial Court had been inactive for a period of five years and that the judgment
had therefore not been enforced. He further observed that it had consisted of
public officials, who had failed to comply with the obligations imposed on them
by a decision of the Regional Commercial Court to form a liquidation commission.
He also submitted that the bailiffs had refused to enforce the judgment given
in his favour as it was outside their jurisdiction and was a matter for the IBF
liquidation commission. He argued that he had exhausted all the domestic
remedies to challenge the lawfulness of the bailiffs’ conduct.
67. The Court considers that the
IBF itself enjoyed sufficient institutional and operational independence from
the State to absolve the State from responsibility under the Convention for its
acts and omissions (see Mykhaylenky and Others v. Ukraine, nos.
35091/02 and others, § 44, ECHR 2004-...). Nevertheless, it points out that
the State’s responsibility for enforcement of a judgment against a private
company extends no further then the involvement of State bodies, including the
domestic courts, in the enforcement proceedings (see, mutatis mutandis, Shestakov
v. Russia (dec.), no. 48757/99, 18 June 2002).
68. It therefore considers that the
Court has jurisdiction to examine whether the domestic authorities have
complied with their positive obligation to enforce the judgment given against a
private entity in the applicant’s favour. It accordingly dismisses the
Government’s preliminary objection.
B. The
Government’s objection as to the exhaustion of domestic remedies
1. Submissions
of the parties
69. The
Government contended that the applicant had not exhausted all the remedies
available to him under Ukrainian law. In particular, he had not lodged
complaints with the Zaporizhzhia Regional Commercial Court seeking an
acknowledgment of his status as a creditor of the IBF. Nor had he complained to
the Zaporizhzhia Regional Commercial Court about the failure of the liquidation
commission to act during the bankruptcy proceedings instituted against the IBF.
They further mentioned that the proceedings against the bailiffs were still
pending.
70. The applicant disagreed. He
stated that the enforcement of judgments against legal entities that were not
bankrupt was a matter for the State bailiffs. Once the entity at issue was declared
bankrupt, the bailiffs had to refer the writs of execution to the liquidation commission
for the relevant company. That did not mean that the enforcement proceedings were
to be terminated. The liquidation commission in the present case had been set
up by a resolution of the Zaporizhzhia Regional Arbitration Court on 20 August 1997 (see paragraph 9 above). However, it had not existed in reality for
almost four years, so it had been impossible to appeal against its actions or
inactivity (see paragraphs 17 and 35 above). He maintained that there had been a
delay on the part of the bailiffs and the domestic courts in failing to oversee
effectively the procedure for liquidating the IBF and in paying compensation
for its debts. He had complained of this delay to the domestic courts, which had
acknowledged it but had made no reparation for the infringement of his rights.
He further claimed that, notwithstanding the fact that it was not his duty to
supervise the liquidation commission’s work, he had nevertheless tried to
complain to it about the failure to enforce the judgments of 24 February 1998. However, he had received no response to his complaints from the de
facto chairman of the liquidation commission, and the Regional Commercial
Court had not examined his complaints on the merits.
71. The applicant further contended
that the judgment of 20 November 1998 declaring his complaints against the
bailiffs well-founded (see paragraph 55 above) was a mere declaration of the State
bailiffs’ inactivity. It was not enforceable. He also submitted that it was unnecessary
to complain to the domestic courts about the bailiffs as it was in any event an
obligation and a particular task of the State bailiffs to enforce final
judgments without undue delay. This obligation was prescribed by law and they should
therefore have used all available and possible legal means to comply with their
duty of enforcing judgments.
2. The Court’s assessment
(a) The Court’s case-law
72. The Court reiterates that,
according to Article 35 § 1 of the Convention, it may only deal with a matter
after all domestic remedies have been exhausted, according to the generally
recognised rules of international law (see Vorobyeva v. Ukraine (dec.), no.
27517/02, 17 December 2002). It observes that it has already ruled on the issue
of exhaustion in a number of its judgments (see, among many other authorities, Romashov
v. Ukraine, no. 67534/01, § 27, 27 July 2004). In particular, the Court has found that the applicant does not have to exhaust domestic
remedies if the debtor is a State body and the enforcement is impeded by lack
of appropriate legislative measures or where a State assumes liability for the
debts of a State-owned legal entity (see Romashov, cited above, § 31).
In the instant case the debtor is not a State entity; however, the applicant’s
complaints about non-enforcement relate to the alleged inactivity of the
domestic authorities in enforcing the judgment and not to the inactivity of the
debtor company.
73. The Court notes that there were
four possible courses of action the applicant could have taken, as suggested by
the Government, in relation to the enforcement of a judgment. It therefore
considers it necessary to decide whether the applicant has exhausted all the
domestic judicial remedies in relation to his complaints about: the delay in enforcement
of the judgment of 24 February 1998; the termination of the enforcement
proceedings in his case; the inactivity of the liquidation commission; and the
failure of the IBF to pay his salary arrears after the bankruptcy proceedings had
been terminated and the IBF’s operational and financial status restored.
(b) Complaints against the bailiffs
about the delay in enforcement of the judgment of 24 February 1998
74. The Court considers that the
applicant has exhausted all the domestic remedies available to him under
Ukrainian law, including an appeal in cassation that was lodged with the Supreme
Court (see paragraph 60 above). The Government’s objection on this point must therefore
be dismissed (see Vorobyeva v. Ukraine, cited above) and the applicant’s
complaint declared admissible. No other ground for declaring it inadmissible has
been established.
(c) Termination of the enforcement
proceedings in the applicant’s case
75. The Court considers that the
applicant has not exhausted all the domestic remedies in relation to these
complaints, as he did not complain to the Supreme Court of Ukraine about the
ruling of the Zaporizhzhia Regional Court of Appeal of 5 May 2003. The applicant accordingly cannot be regarded as having exhausted all domestic remedies
available to him under Ukrainian law. It follows that this part of the
application must be rejected under Article 35 §§ 1 and 4 of the Convention.
(d) Complaints about the inactivity
of the liquidation commission
76. The Court takes note of the
aforementioned considerations as to the status of the liquidation commission
(see paragraphs 65-67 above). However, it still considers it necessary to
discuss the issue of exhaustion as it was raised by the Government. It observes
that enforcement of the judgment at issue was within the jurisdiction of the
Bailiffs’ Service until the liquidation commission for the IBF was formed and
the writs of execution were transmitted to it (on 27 June 2002). It would therefore be inconceivable to suggest that the applicant should have instituted
additional proceedings in the Zaporizhzhia Regional Commercial Court seeking
enforcement of a judgment with regard to an entity that did not yet have any
jurisdiction over the enforcement proceedings and did not exist de facto
(see paragraphs 17 and 35 above). As to the possibility of lodging complaints
against the liquidation commission after 27 June 2002, the Court considers that,
from the refusals of the Zaporizhzhia Regional Commercial Court to consider the
applicant’s complaints (see paragraphs 44-46 above), it ensues that this remedy,
in the circumstances of the instant case, did not offer reasonable prospects of
success to the applicant and was ineffective. Moreover, the liquidation commission
ceased to exist on 23 July 2002 with the adoption of the friendly settlement between
the parties to the bankruptcy proceedings. However, notwithstanding these
considerations and taking into account the fact that the State cannot be held
liable for the acts or omissions of the liquidation commission, the Court
considers that this part of the application should be dismissed as being
incompatible ratione personae.
(e) The failure of the IBF to comply
with the judgment of 24 February 1998 after the conclusion of a friendly
settlement
77. As to the remainder of the applicant’s
complaints under Article 6 § 1 of the Convention about the failure to enforce a
judgment in the applicant’s favour, the Court considers that, following the
friendly settlement in the bankruptcy proceedings against the IBF and the
restoration of the status of the IBF as an operational private company, the
applicant is entitled to bring further enforcement proceedings with regard to
the remainder of the debt and, if he is still unsatisfied with the activities
of the bailiffs, to lodge additional complaints with the domestic courts and
seek compensation for pecuniary and non-pecuniary damage. Accordingly, the
applicant has not exhausted all domestic remedies available to him as regards
this aspect of the case. It follows that it must be rejected pursuant to
Article 35 §§ 1 and 4 of the Convention.
(f) Conclusions
as to admissibility
78. Taking
into account its considerations as to admissibility ratione personae and
the exhaustion of domestic remedies, the Court concludes that the applicant’s
complaints under Article 6 § 1 of the Convention are only admissible in
relation to the inactivity of the bailiffs from 24 February 1998 (the date
of the adoption of the judgment by the Berdiansk Court) to 27 June 2002
(the date on which the writs of execution were transmitted to the IBF liquidation
commission).
C. Admissibility of the complaints
under Article 13 of the Convention
79. The
Court refers to its conclusions as to the admissibility of the applicant’s
complaints under Article 6 § 1 of the Convention (see the preceding paragraph 78),
which are equally pertinent to the applicant’s complaints under Article 13 of
the Convention. Consequently, the Court declares admissible the applicant’s
complaints under Article 13 only in so far as they are related to those deemed
to be admissible under Article 6 § 1 of the Convention.
D. Complaint under Article 1 of
Protocol No. 1 to the Convention
80. The Court considers, in the
light of the parties’ submissions and taking into account the scope of the
issues under consideration, that this complaint raises serious issues of fact
and law under the Convention, the determination of which requires an
examination of the merits. The Court concludes, therefore, that this complaint
is not manifestly ill-founded within the meaning of Article 35 § 3 of the
Convention. No other ground for declaring it inadmissible has been established.
II. ALLEGED
VIOLATION OF ARTICLE 6 § 1 OF THE CONVENTION
81. The Government submitted that
they had taken all the measures prescribed by domestic legislation to enforce
the judgment in the applicant’s favour. Moreover, they maintained that the
non-enforcement of the judgment in the period from 24 February 1998 to 27 June 2002 had not violated the applicant’s rights under Article 6 § 1 of the
Convention. They further submitted that the delay in enforcement was not
attributable to the domestic authorities. They reiterated that the decision
given in the applicant’s favour had not been executed in full, owing to the
failure of the private company to act.
82. The applicant replied that the enforcement
proceedings had been pending since 24 February 1998 and were still so. He further stated that the sum awarded to him had decreased in value because of
inflation from the date of the original judgment, and that he had not been provided
with compensation for that. He also pointed out that part of the sum, UAH 1,000, had been paid to him after the
liquidation commission had commenced its work. However, it had ceased to exist
on 23 July 2002.
83. The Court notes that a delay in
the execution of a judgment may be justified in particular circumstances. But
the delay may not be such as to impair the essence of the right protected under
Article 6 § 1 (see Immobiliare Saffi v. Italy [GC], no.
22774/93, § 74, ECHR 1999-V).
84. Furthermore, the Court considers
that the State has a positive obligation to organise a system for enforcement
of judgments that is effective both in law and in practice and ensures their
enforcement without any undue delay. The Court, taking into account the
considerations as to the liability of the State for the acts or omissions of
private persons (see paragraphs 65-67 above), finds that there was a lack of
action on the part of the State Bailiffs’ Service, as was acknowledged by the Berdiansk
City Court on 20 November 2002, to enforce the judgment given in the
applicant’s favour within a reasonable time and to exercise effective supervision
of the enforcement of the judgment by the IBF liquidation commission. In
particular, the judgment was given on 24 February 1998, and the writs of execution were issued on 22 April 1999. However, they were not transmitted to
the liquidation commission until 27 June 2002, more than 3 years later.
85. The Court also notes that the
liquidation commission, being formed on 20 August 1997 by a resolution of the Zaporizhzhia Regional Arbitration Court, did not exist de facto and deviated
from its duties. Furthermore, the applicant received almost half of the sum he
was owed more than four years after the liquidation commission had been formed
and had commenced its work. It considers that, even though the domestic courts
declared the bailiffs liable for the delay in enforcement (see paragraph 55
above), they did not afford any redress or reparation for that failing.
86. The Court considers, therefore,
that the failure of the bailiffs to act for well over four years or to
effectively control the enforcement proceedings in the present case, is
sufficient to conclude that there has been a violation of Article 6 § 1 of the
Convention.
III. ALLEGED VIOLATION OF ARTICLE
13 OF THE CONVENTION
87. The Court refers to its
findings (paragraph 74 above) in the present case in relation to the Government’s
argument about domestic remedies. For the same reasons, the Court concludes
that the applicant did not have an effective domestic remedy, as required by
Article 13 of the Convention, to redress or compensate the damage created by
the delay attributable to the State bailiffs in the enforcement of the judgment
(see Voytenko v. Ukraine, no. 18966/02, judgment of
29 June 2004, §§ 46-48). Accordingly, there has been a breach of this
provision.
IV. ALLEGED VIOLATION OF ARTICLE
1 OF PROTOCOL NO. 1 TO THE CONVENTION
88. The Court notes that the
parties did not dispute that there had been interference with the applicant’s
property rights.
89. The applicant’s complaint is
that the State failed to comply with its obligation to exercise effective
control over the bankruptcy proceedings in his case, thus allowing for the protracted
enforcement of the judgment of 24 February 1998 against the IBF. The Court must
therefore examine, in the instant case, whether the failure of the domestic authorities
to exercise effective control over the procedure for the enforcement of the
judgment and to use all available avenues for its enforcement was compatible
with the applicant’s right to the peaceful enjoyment of his possessions.
90. The Court reiterates that by
virtue of Article 1 of the Convention, each Contracting Party “shall secure to
everyone within [its] jurisdiction the rights and freedoms defined in ... [the]
Convention”. The obligation to secure the effective exercise of the rights
defined in that instrument may result in positive obligations for the State
(see, among other authorities, X and Y v. Netherlands, judgment of
26 March 1985, Series A no. 91, p. 11, §§ 22-23). In such circumstances,
the State cannot simply remain passive and “there is ... no room to distinguish
between acts and omissions” (see, mutatis mutandis, Airey v. Ireland,
judgment of 9 October 1979, Series A no. 32, p. 14, § 25).
91. As regards the right guaranteed
by Article 1 of Protocol No. 1, those positive obligations may entail certain
measures necessary to protect the right to property (see, among other
authorities and mutatis mutandis, López Ostra v. Spain, judgment of 9
December 1994, Series A no. 303-C, p. 55, § 55), even in cases
involving litigation between private individuals or companies (see Sovtransavto Holding v. Ukraine, no.
48553/99, § 96, ECHR 2002‑VII). This means, in
particular, that States are under an obligation to ensure that the procedures
enshrined in the legislation for the enforcement of final judgments and for
bankruptcy proceedings are complied with.
92. The Court considers that the
failure of the bailiffs to act and the domestic courts’ failure to exercise
appropriate control over the situation, created permanent uncertainty as to the
enforcement of a judgment in the applicant’s favour and as to the payment of
the debt owed to him. Consequently, the applicant had to cope with that
uncertainty during a lengthy period of time, from 24 February 1998 (the date when the judgment was given in his favour) to 27 June 2002 (the date when the bailiffs transmitted the writs of execution to the liquidation commission for
the IBF Company).
93. Having regard to the foregoing
considerations and to its findings in respect of Article 6 § 1 of the
Convention, the Court is of the view that the manner in which the enforcement proceedings
were conducted, their total length and the uncertainty in which the applicant
was left, upset the “fair balance” that had to be struck between the demands of
the public interest and the need to protect the applicant’s right to the
peaceful enjoyment of his possessions. Consequently, the State failed to comply
with its obligation to secure to the applicant the effective enjoyment of his right
of property, as guaranteed by Article 1 of Protocol No. 1.
IV. APPLICATION
OF ARTICLE 41 OF THE CONVENTION
94. Article
41 of the Convention provides:
“If the Court
finds that there has been a violation of the Convention or the Protocols
thereto, and if the internal law of the High Contracting Party concerned allows
only partial reparation to be made, the Court shall, if necessary, afford just
satisfaction to the injured party.”
A. Damage
95. The applicant claimed UAH 20,000 (EUR 3,415)
by way of just satisfaction. He stated that he had suffered pecuniary loss as a
result of the failure of the domestic authorities to enforce the judgment given
in his favour.
96. The Government maintained that the applicant had not
suffered any pecuniary or non-pecuniary damage. They suggested that a finding
of a violation would in itself constitute sufficient just satisfaction.
97. Making its assessment on equitable basis, as required
by Article 41 of the Convention, the Court considers it reasonable to award the
applicant a global sum of EUR 1,500 in respect of damages, costs and expenses.
B. Default interest
98. The Court considers it
appropriate that the default interest should be based on the marginal lending
rate of the European Central Bank, to which should be added three percentage
points.
FOR THESE
REASONS, THE COURT UNANIMOUSLY
1. Declares
admissible the complaints under Articles 6 § 1 and 13 of the
Convention and Article 1 of Protocol No. 1, concerning the failure to enforce
the final judicial decision in the applicant’s case and the lack of effective
remedies in this respect, and the remainder of the application inadmissible;
2. Holds
that there has been a violation of Article 6 § 1 of the Convention;
3. Holds that there has been
a violation of Article 13 of the Convention;
4. Holds that there has been
a violation of Article 1 of Protocol No. 1 to the Convention;
5. Holds
(a) that the respondent State is to
pay the applicant, within three months from the date on which the judgment
becomes final according to Article 44 § 2 of the Convention, EUR
1,500 (one thousand five hundred euros) in respect of damages, costs and
expenses, plus any tax that may be chargeable, to be converted into the
currency of the respondent State at the rate applicable on the date of
settlement;
(b) that from the expiry of the
above-mentioned three months until settlement simple interest shall be payable
on the above amount at a rate equal to the marginal lending rate of the
European Central Bank during the default period plus three percentage points;
6. Dismisses the remainder of the applicant’s claim for just satisfaction.
Done in English, and notified in writing
on 7 June 2005, pursuant to Rule 77 §§ 2 and 3 of the Rules of Court.
S.
Naismith J.-P.
Costa
Deputy Registrar President
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