CASE OF PALCHIK v. UKRAINE
Violation of Article 6 - Right to a fair trial (Article 6 - Criminal proceedings;Article 6-1 - Fair hearing;Equality of arms);No violation of Article 6+6-3-d - Right to a fair trial (Article 6 - Criminal proceedings;Article 6-1 - Fair hearing) (Article 6 - Right to a fair trial;Article 6-3-d - Examination of witnesses);Violation of Article 6+6-3-d - Right to a fair trial (Article 6 - Criminal proceedings;Article 6-1 - Fair hearing) (Article 6 - Right to a fair trial;Article 6-3-d - Examination of witnesses);No violation of Article 34 - Individual applications (Article 34 - Hinder the exercise of the right of application)
André Potocki;Angelika Nußberger;Carlo Ranzoni;Ganna Yudkivska;Síofra O’Leary;Yonko Grozev
4. The applicant was born in 1954 and is currently residing in Kostyantynivka. Before his arrest the applicant was the managing director of a private company, A. 5. A. concluded a contract with E., a Russian company, undertaking to export a certain amount of ferromanganese to Russia. 6. During the period from March 2000 to April 2001 the applicant, in his capacity as the director of A., concluded contracts with four Ukrainian companies, F., T., M. and Sh. (“the seller companies”) According to those contracts A. would buy the goods from the companies and pay them sums which included value added tax (VAT). 7. On a number of occasions between March 2000 and April 2001 A. exported ferromanganese to Russia, delivered it to E. and received payment for it. Subsequently, A. claimed and, in April 2002, received from the Ukrainian authorities a refund of the VAT mentioned in the contracts with the seller companies. 8. In 2002 criminal proceedings were instituted against the applicant. According to the investigating authorities, the contracts which A. had concluded with the four seller companies were fictitious and had been concluded for the sole purpose of obtaining export VAT refunds. In fact those companies had not sold ferromanganese to A. Instead, the applicant and his co-defendants had bought the ferromanganese from private persons, without concluding any contracts with them and without paying VAT on those transactions. The applicant had then forged certificates of quality and fraudulently obtained certificates of origin for the goods. Using all the above documents, A. had exported the goods to Russia. He had then obtained or applied for VAT refunds based on the fictitious documents. 9. The applicant stated that the contracts had not been fictitious and the certificates had not been forged. A. had legally bought ferromanganese from the private companies, exported it to Russia and received tax refunds. 10. During the pre-trial investigation, the investigating authorities questioned managers of the four seller companies and the owner of a lorry which had been used for transporting the goods. They made certain statements the domestic courts subsequently found to be incriminating. In particular, managers of the four seller companies said that the contracts had been either forged or fictitious and that no actual shipments of the goods had taken place. Some of the managers repeated those statements in the course of confrontations with the applicant conducted in the course of the pre-trial investigation. Detailed information about the statements of the witnesses and confrontations can be found in the Table set out in paragraph 17 below. 11. On an unspecified date the investigation was completed and the case was referred to the Kostyantynivka Court for trial. 12. On at least five occasions between 28 November 2003 and 27 August 2004 the court ordered the Donetsk regional police to bring the witnesses listed in the Table below to court hearings, but the police failed to do so for various reasons. 13. On 27 August 2004 the police informed the court, in response to its latest order to bring the witnesses to court, that S., K. and R. (see Elements 1-3 in the Table below) were away from Donetsk on holiday. 14. At the court hearing held on the same day the prosecutor, in the light of the above-mentioned information from the police, asked the court to read out the pre-trial statements of the witnesses who had failed to appear, including all those listed in the Table below. The defence did not object and the statements were read out. The court then proceeded to examine the documents in the file. 15. On 29 September 2004 the applicant’s lawyer requested the court to summon S., K. and R. again (see Elements 1-3 in the Table below), because the examination of documents had revealed inconsistencies in their pre-trial statements and because the reasons for their failure to appear had not been established. The trial court refused the request on the grounds that the statements of those witnesses had already been read out at the trial. 16. On 24 December 2004 the court found the applicant guilty of smuggling (export of ferromanganese based on forged documents), misappropriation accompanied by abuse of office (receipt of tax refunds on the basis of fictitious and forged documents), abuse of office, and forgery of documents. For the charge of misappropriation accompanied by abuse of office the applicant was sentenced under the Criminal Code of 2001 to seven years and six months’ imprisonment with a ban on holding managerial positions for two years. He was also sentenced to various other more lenient punishments under the Criminal Code of 2001, but the court held that the most severe of the applicant’s punishments absorbed the more lenient ones. The final sentence was thus seven years and six months of imprisonment with a ban on holding managerial positions for two years. 17. In convicting the applicant the court relied, in particular, on the statements of a number of witnesses given during the pre-trial investigation, as shown in the below Table: Table. Witness evidence 18. The trial court also relied on certain inconsistencies between the official records of the applicant’s company and the shadow accounting records discovered by the authorities. 19. The applicant and his lawyer appealed. They stated, inter alia, that the trial court had relied on the evidence of witnesses who had not been examined at the trial and that he should have been tried for smuggling under the Criminal Code of 1960. 20. On 4 March 2005 the Donetsk Regional Court of Appeal held that the applicant should be deemed to have been convicted for smuggling under the Criminal Code of 1960 instead of the Criminal Code of 2001. Otherwise, the Court of Appeal upheld the findings of the first-instance court and the applicant’s sentence. 21. According to the applicant, the appellate court did not give him a copy of the decision of 4 March 2005, despite his numerous requests. 22. In March 2005 the applicant’s lawyer appealed on points of law to the Supreme Court against the decisions of 24 December 2004 and 4 March 2005 and enclosed copies of those decisions with her appeal. In May, June and August 2005 the applicant lodged his own appeals with the Supreme Court, stating, inter alia, that the trial court had relied on evidence of witnesses who had not been examined at the trial. The applicant also stated that he should have been tried for misappropriation, abuse of office and forgery under the Criminal Code of 1960, rather than the Code of 2001, but did not provide any details. 23. On 6 September 2005 the Supreme Court heard the case in the presence of the prosecutor but in the absence of the applicant and his lawyer, who were not informed of the date and time of the hearing. The Supreme Court dismissed the appeals lodged by the applicant and his lawyer, stating that the lower courts’ findings had been based on a substantial amount of evidence, in particular the statements of the directors of the seller companies made at the investigation stage. 24. On 15 May 2009 the applicant was released from detention following a presidential pardon.