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SECOND
SECTION
CASE OF HILTI v. HUNGARY
(Application
no. 25709/04)
JUDGMENT
STRASBOURG
9
October 2007
This judgment will
become final in the circumstances set out in Article 44 § 2
of the Convention. It may be subject to editorial revision.
In the case of Hilti v. Hungary,
The
European Court of Human Rights (Second Section), sitting as a Chamber
composed of:
Mrs F. Tulkens, President,
Mr A.B.
Baka,
Mr R. Türmen,
Mr M.
Ugrekhelidze,
Mr V. Zagrebelsky,
Mrs A.
Mularoni,
Mr D. Popović, judges,
and
Mrs F. Elens-passos, Deputy Section Registrar,
Having
deliberated in private on 18 September 2007,
Delivers
the following judgment, which was adopted on that date:
PROCEDURE
- The
case originated in an application
(no. 25709/04) against the
Republic of Hungary lodged with the Court
under Article 34 of the Convention for the Protection
of Human Rights and Fundamental Freedoms (“the Convention”)
by Mr Fabio Hilti, a Liechtenstein national (“the applicant”).
- The
Hungarian Government (“the Government”) were represented
by Mr L. Höltzl, Agent, Ministry of Justice and Law Enforcement.
The applicant was represented by Mr J. Gregorits, a lawyer practising
in Budapest.
- On
15 September 2006 the
Court decided to give notice of the application to the Government.
Applying Article 29 § 3 of the Convention, it decided to rule on
the admissibility and merits of the application at the same time.
- On
4 December 2006 the Government of the Principality of Liechtenstein
declared that they would not exercise their right under Article 36 §
1 of the Convention and Rule 44 of the Rules of Court to intervene in
the proceedings.
THE FACTS
THE CIRCUMSTANCES OF THE CASE
- The
applicant was born in 1938 and lives in Schaan, Liechtenstein.
- The
facts of the case, as submitted by the parties, may be summarised as
follows.
- On
24 August 1996 the company Hilti and Hilti Handles AG, owned by the
applicant, initiated the liquidation of the Hungarian company S.,
since the latter had been reluctant to pay its outstanding debts
amounting to 1,250,000 German Marks (approximately 639,114.85 euros).
- On
17 September 1996 the Budapest Regional Court dismissed the
applicant's claim and terminated the liquidation proceedings, since
the debtor had contested both the existence and the amount of its
debts and the applicant had not been able to prove that company S.
was insolvent.
- On
appeal, on 7 November 1997 the Supreme Court, acting as a
second-instance court, quashed the first-instance decision and
remitted the case to the Regional Court.
- On
10 March 1998 the Budapest Regional Court held a hearing and invited
the applicant to submit all relevant documents proving the insolvency
of company S. Upon the applicant's request, the Regional Court
extended the time-limit. On 6 May 1998 the applicant submitted the
information requested.
- On
2 November 1998 the Regional Court ordered the liquidation of the
company S. On 7 January 1999 the latter merged with company C.
- On
8 January 2001, under the same file-number, the Supreme Court, acting
as a second-instance court, quashed the first-instance decision. It
observed that the debtor had merged with company C. and held that,
without the examination of the latter's solvency, its liquidation
should not have been ordered.
- On
13 March 2001 the Regional Court invited the applicant to declare
whether his company wished to maintain its claim. The suit was
maintained.
- In
the resumed proceedings, on 18 April 2001 the Budapest Regional Court
found that it had no jurisdiction to deal with the case and
transferred it to the Zala County Regional Court.
- On
8 October 2001 the Regional Court ordered the liquidation of company
C. Subsequently, the Regional Court withdrew this decision because of
procedural shortcomings.
- On
30 May 2002 the Regional Court again ordered the liquidation of
company C. and appointed a liquidator. The company appealed.
- On
1 April 2003 the Supreme Court, acting as a second-instance court,
dismissed the appeal. On 9 September 2003 the Regional Court
accepted the liquidator's closing balance sheet.
- On
29 April 2005 the Regional Court ordered, in simplified proceedings
(egyszerűsített felszámolási eljárás),
the liquidation of company C. It established that the debtor's assets
were insufficient to cover the expenses of the liquidation
proceedings and the applicant's claim.
- On
28 May 2005 the Regional Court dissolved company C., which was
consequently deleted from the company register on 18 July 2005.
THE LAW
I. ALLEGED VIOLATION OF ARTICLE 6 § 1 OF THE
CONVENTION
- The
applicant complained that the length of the proceedings had been
incompatible with the “reasonable time” requirement of
Article 6 § 1 of the Convention, which reads as follows:
“In the determination of his civil rights and
obligations ..., everyone is entitled to a ... hearing within a
reasonable time by [a] ... tribunal...”
- The
Government contested that argument. They argued that the liquidation
proceedings in fact consisted of two separate proceedings, against
company S. and company C., both of which lasted some three years and,
since no inactive period imputable to the courts could be observed,
neither had exceeded a reasonable time.
- The
Court notes in this connection that company C. became the legal
successor of company S., resulting in the obligation to meet the
debts of the latter. Moreover, it is to be observed that the domestic
courts treated the liquidation proceedings as one procedure, and the
Court sees no reason to depart from this view.
- Therefore,
the period to be taken into consideration began on 24 August 1996 and
ended on 28 May 2005. It thus lasted eight years and nine months
before two levels of jurisdiction.
A. Admissibility
- The
Court notes that this complaint is not manifestly ill-founded within
the meaning of Article 35 § 3 of the Convention. It further
notes that it is not inadmissible on any other grounds. It must
therefore be declared admissible.
B. Merits
- The
Court reiterates that the reasonableness of the length of proceedings
must be assessed in the light of the circumstances of the case and
with reference to the following criteria: the complexity of the case,
the conduct of the applicant and the relevant authorities and what
was at stake for the applicant in the dispute (see, among many other
authorities, Frydlender v. France [GC], no. 30979/96, §
43, ECHR 2000-VII).
- The
Court has frequently found violations of Article 6 § 1 of the
Convention in cases raising issues similar to the one in the present
application (see Frydlender, cited above).
- Having
examined all the material submitted to it, the Court considers that
the Government have not put forward any fact or convincing argument
capable of persuading it to reach a different conclusion in the
present case. Having regard to its jurisprudence on the subject, the
Court finds that the length of the proceedings was excessive and
failed to meet the “reasonable time” requirement.
There
has accordingly been a breach of Article 6 § 1.
II. ALLEGED VIOLATION OF ARTICLE 1 OF PROTOCOL NO. 1
- The
applicant claimed that the length of the proceedings in question
deprived him of the enjoyment of his property. He relied on Article 1
of Protocol No. 1, which provides 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."
- The
Court notes that this complaint is linked to that under Article 6 § 1
of the Convention which has already been examined above and must
therefore, likewise, be declared admissible. However, having regard
to its finding under Article 6 § 1 (see paragraph 27 above), the
Court considers that it is not necessary to examine separately
whether there has also been a violation of Article 1 of Protocol No.
1 (see Zanghì v. Italy, judgment of 19 February
1991, Series A no. 194-C, p. 47, § 23).
III. APPLICATION OF ARTICLE 41 OF THE CONVENTION
- 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
- The
applicant claimed 639,114 euros (EUR) in respect of pecuniary and
non-pecuniary damage.
-
The Government contested these claims.
- The
Court does not discern any causal link between the violation found
and the pecuniary damage alleged; it therefore rejects this claim.
However, on an equitable basis, it awards the applicant EUR 6,000 for
non-pecuniary damages.
B. Costs and expenses
- The
applicant also claimed 4,300 Swiss Francs
for the costs and expenses incurred before the domestic courts and
EUR 6,400 for those incurred before the Court.
- The
Government did not express an opinion on the matter.
- According
to the Court's case-law, an applicant is entitled to the
reimbursement of costs and expenses only in so far as it has been
shown that these have been actually and necessarily incurred and were
reasonable as to quantum. The Court notes that the applicant's costs
claim has not been substantiated by any relevant documents and must
therefore be rejected.
C. Default interest
- 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
- Declares the application admissible;
- Holds that there has been a violation of Article
6 § 1 of the Convention;
3. Holds that there is no need to examine
separately the complaint under Article 1 of Protocol No. 1 to the
Convention;
- Holds
(a) that the respondent State is to pay the applicant,
within three months from the date on which the judgment becomes final
in accordance with Article 44 § 2 of the
Convention, EUR 6,000 (six thousand euros) in respect of
non-pecuniary damage, to be converted into the national currency of
the respondent State at the rate applicable at the date of
settlement, plus any tax that may be chargeable;
(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;
- Dismisses the remainder of the applicant's claim
for just satisfaction.
Done in English, and notified in writing on 9 October 2007, pursuant
to Rule 77 §§ 2 and 3 of the Rules of Court.
F. Elens-passos F. Tulkens Deputy Registrar President
