CASE OF FUKLEV v. UKRAINE
Violation of Article 6 - Right to a fair trial (Article 6 - Enforcement proceedings;Article 6-1 - Reasonable time);Violation of Article 13 - Right to an effective remedy (Article 13 - Effective remedy);Violation of Article 1 of Protocol No. 1 - Protection of property (Article 1 of Protocol No. 1 - Positive obligations;Article 1 para. 1 of Protocol No. 1 - Peaceful enjoyment of possessions);Pecuniary and non-pecuniary damage - award (Article 41 - Non-pecuniary damage;Pecuniary damage;Just satisfaction)
Zoryana Bortnovska
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. 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). 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. 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.