CASE OF AVIAKOMPANIYA A.T.I., ZAT v. UKRAINE
Remainder inadmissible;Violation of Article 6 - Right to a fair trial (Article 6 - Civil proceedings;Article 6-1 - Tribunal established by law);Pecuniary damage - claim dismissed (Article 41 - Pecuniary damage;Just satisfaction);Non-pecuniary damage - award (Article 41 - Non-pecuniary damage;Just satisfaction)
André Potocki;Angelika Nußberger;Carlo Ranzoni;Ganna Yudkivska;Yonko Grozev
5. The applicant company was a Ukrainian joint-stock company registered in Kyiv. At the relevant time it operated a commercial air carrier business (see East West Alliance Limited v. Ukraine, no. 19336/04, § 7, 23 January 2014). 6. On 12 March 2003 the applicant company brought a claim for damages, in particular loss of profit, against the State Aviation Safety Department. The claim was based on a delay on the defendant’s part in issuing a safety certificate, which the Department had been required to issue in 2001 by a court judgment. 7. On 16 August 2005 the Kyiv City Commercial Court allowed the claim in part. 8. On 18 October 2005 the Kyiv Commercial Court of Appeal quashed the first-instance court’s judgment and rejected the claim, mainly on the grounds that the applicant company had failed to prove the loss of profit it had claimed. It considered the estimates of the loss profit speculative. 9. On 21 February 2006 the Higher Commercial Court reversed the ruling of the Court of Appeal and upheld the judgment of the first instance court. The Higher Court held that because the defendant’s inaction prevented the applicant company from operating its business as from 2001, the first instance court was correct in accepting the information about the applicant company’s gross income for 1999 and 2000. 10. On 6 June 2006 the Supreme Court quashed the ruling of the Higher Commercial Court and upheld the ruling of the Court of Appeal. The Supreme Court considered that no causal connection has been proven between the defendant’s culpable inaction and the alleged loss of profit. It held, in particular, that the applicant company had failed to prove that it had realised a profit, rather than gross income, prior to 2001, or that its income for the preceding years came from operations which required a safety certificate. 11. Following communication of the case and unsuccessful friendly settlement negotiations, on 2 September 2014 the Government informed the Court of their intention to resolve the issue raised by the application. They produced a unilateral declaration, in which they acknowledged a breach of Article 6 § 1 of the Convention and offered to pay the applicant company a sum to cover any pecuniary and non-pecuniary damage together with any costs and expenses. The Government requested that the Court strike out the application in accordance with Article 37 § 1 of the Convention. 12. On 7 November 2014 the applicant company objected to the striking out of its application, wishing to have its merits determined with a view to obtaining appropriate redress. It argued, in particular, that under domestic law the unilateral declaration, unlike a Court’s judgment finding a violation, would not provide grounds for reexamination of its case by the Supreme Court. The Government’s unilateral declaration would therefore not lead to actual restoration of the applicant company’s rights. 13. The Government were invited to comment and on 10 July 2015 informed the Court of the relevant domestic legislation (see paragraphs 15 and 16 below). They submitted a letter from the Supreme Court informing the Government Agent there was no relevant domestic caselaw on the matter. 14. On 3 November 2015 the applicant company’s only shareholder, East/West, informed the Court that on 2 October 2014 the Kyiv City Commercial Court had declared the applicant company bankrupt and opened liquidation procedure and on 8 October 2015 had declared it liquidated. Accordingly, East/West requested that any just satisfaction award due to the applicant company be paid to East/West. Asked to comment, the Government responded on 18 January 2016 that they “do not object against the applicant’s request as to the payment to its sole shareholder the awarded compensation and, thus, leave this question on the Court’s discretion”.