GAYDUK AND OTHERS v. UKRAINE
Inadmissible
The facts of the case, as submitted by the parties, may be summarised as follows. All the applicants are Ukrainian nationals and residents who opened savings accounts with the Ukraine Savings Bank, which until 1992 was an integral part of the USSR Savings Bank. With the exception of the cases expressly referred to below, all the accounts were opened in the 1980s. Under the terms of the agreements: “The State guarantee[d] that deposits [would] be repaid in full on demand by the account holder”. The rule was not stated to be subject to any restrictions. In 1996 the Ukrainian authorities implemented a monetary reform intended to replace the former monetary unit, the karbovanets coupon, with a new currency, the Ukrainian hryvna (українськa гривнa, UAH), at an exchange rate of 100,000 karbovanets coupons for 1 hryvna. The conversion also had an impact on the applicants’ deposits, which had already considerably depreciated as a result of inflation. On 21 November 1996 the Ukrainian Parliament enacted the Ukrainian Citizens’ Deposits (State Guarantee of Reimbursement) Act (Law no. 537/96). Pursuant to section 3 of that Act, the applicants’ deposits were indexed at a ratio of 1 karbovanets coupon to 1.05 hryvnas. Section 7 established a system for the indexed savings to be repaid progressively, taking into account the account holder’s age, the amount on deposit and other criteria. Each year the Government brings in regulations specifying the categories of account holders entitled to receive compensation in the coming year. Under the regulations, only account holders aged 80 or over are entitled to recover a part of their savings (UAH 48, equivalent to approximately 10 euros (EUR) per person). In addition, on an account holder’s death, his or her heirs are entitled to UAH 150 to pay for the burial. In the late 1990s each of the applicants issued proceedings against the Ukraine Savings Bank in the relevant courts seeking payment of all or part of their indexed deposits in hryvnas. Their claims were dismissed both at first instance and on appeal on points of law. In most of the decisions, the courts held that the claimants concerned were not entitled to compensation under Law no. 537/96 for the fall in value of their deposits, as they were under 80 and thus had no valid legal claim granted by the Government under the Act. As regards the fifth, twelfth, thirteenth and fourteenth applicants, who had attained the qualifying age, the courts found that they were entitled to compensation limited to UAH 48, as the legislation in force did not provide for the repayment of the full value of their deposits. Subsequently, some of the applicants made one or more unsuccessful applications for supervisory review of the final decision to the President of the Ukrainian Supreme Court or the president of the relevant regional court. ... The first paragraph of Article 41 of the Constitution (Конституцiя Украïни) reads as follows: “Everyone has the right to own, use and dispose of his or her property...” The relevant parts of Article 384 of the Civil Code (Цивiльний кодекс) read as follows: “Private persons may deposit sums of money in State savings banks and other financial institutions, have access to their deposits... The State guarantees the confidentiality and safekeeping of deposits and their repayment on demand by the account holder...” The third paragraph of section 39 of the Banking Activities Act (Закон “Про банки i банкiвську дiяльнiсть” – Law no. 872-XII of 20 March 1991), which was in force until January 2001, provided: “... Ukraine shall guarantee the safekeeping of deposits ... lodged by private persons with the Ukraine Savings Bank and their repayment to account holders on demand.” The relevant provisions of the State Guarantees of the Reimbursement of Ukrainian Citizens’ Deposits Act (Закон “Про державнi гарантiï вiдновлення заощаджень громадян Украïни” – Law no. 537/96 of 21 November 1996) provide: Section 1 “This Act sets out the State’s obligations to Ukrainian citizens who, following the devaluation, have lost money which they deposited before 2 January 1992 in branches of the USSR Savings Bank ... carrying on business on Ukrainian territory... Similarly, Ukrainian citizens who deposited money with a branch of the USSR Savings Bank ... between 1992 and 1994 which remained in the accounts of the Ukraine Savings Bank for at least one full year between 1992 and 1995 shall be entitled to compensation...” Section 2 “The State undertakes to maintain and update the real value of individual savers’ deposits and to pay them compensation in accordance with the relevant provisions.” Section 3 “The deposits by the private individuals referred to in the first paragraph of section 1 of this Act shall be revalued using the ratio of 1.05 hryvnas for 1 karbovanets coupon lodged, corresponding to the position at 1 October 1996.” Section 6 (as amended by Law no. 8/97 of 17 January 1997) “The payment of compensation to Ukrainian citizens for damage resulting from the depreciation of their deposits shall be made ... by the Treasury ... from 1997 onwards. The funds set aside to finance this compensation scheme ... shall constitute a special item in the budget of the Ukrainian State...” Section 7 “Deposits shall be reimbursed progressively taking into account the account holder’s age, the amount of the deposit and other criteria and the amount of funds allocated for that purpose in the Ukrainian State budget for the forthcoming year. [Paragraph amended by Law no. 201/98 of 24 March 1998] The list of the categories of account holders, the order of reimbursement of the indexed pecuniary deposits and the amount of the payments referred to in section 8 of this Act shall be determined by the Ukrainian Cabinet to the extent the funds allocated for that purpose in the budget of the Ukrainian State allow.” Section 8 “[Paragraph amended by Law no. 201/98 of 24 March 1998] On an account holder’s death, the heirs ... may withdraw parts of the indexed deposit ... for the purposes of arranging the funeral, the amount being calculated by reference to the amount of the funeral grant...” The categories of persons eligible for repayment of their deposits are defined in regulations (постанова) approved each year by the Cabinet for the forthcoming year (see regulations nos. 1210 of 31 October 1997, 825 of 8 June 1998, 457 of 25 March 1999, 817 of 17 May 2000, and 275 of 26 March 2001). Under these regulations, the right to partial reimbursement of the deposits is reserved to account holders who attained the age of 80 by 1 January 1997 and heirs of deceased account holders, for the purposes of making burial arrangements. Account holders from the first category are entitled to reimbursement of UAH 48 (approximately EUR 10), whereas the heirs of deceased account holders are entitled to an amount equivalent to the funeral grant, that is to say UAH 150 (approximately EUR 30). Since 1999 disabled ex-servicemen have also been able to claim reimbursement of part of their deposits. Regulation no. 275, which covers the year 2001, added to these categories account holders who had reached the ages of 100 or 80 respectively by 1 January 2001. Account holders in the latter category are entitled to the sum of UAH 50. All the aforementioned payments may only be made “to the extent the sum allocated in the State budget for the year concerned allows”. According to a practice direction (no. 1-5/117) issued by the Ukraine Supreme Court on 15 March 1999 on the implementation of Law no. 537/96, complaints concerning the repayment of indexed deposits to private individuals under the statutory guarantee provisions in force are to be dealt with under the contentious-business procedure. The practice direction is binding on all Ukrainian courts. When deciding such cases, the courts must remember that they are not dealing with liability for breach of contract between the account holder and the Savings Bank, but with the repayment of revalued deposits under the relevant provisions. The Supreme Court also directed that payments of compensation for indexed deposits must be made solely through branches of the Savings Bank. Consequently, in the event of litigation, the regional branch of the Savings Bank and the Ukraine Treasury must be joined to the proceedings as defendants. The Savings Banking reimburses the indexed deposits to the extent the sums allocated for that purpose in the budget of the Ukrainian State have been paid over to it in accordance with the ranking provisions established by the Cabinet. Thus, if a court finds that the sums concerned have not been paid to the Savings Bank or that the claimant is not a person entitled to reimbursement of the deposits for the year concerned, that person’s claim must be dismissed. If the claim exceeds the prescribed sum, the court shall grant it to the extent laid down in the State Guarantees of the Reimbursement of Ukrainian Citizens’ Deposits Act. On 5 April 2002 the Cabinet passed a resolution concerning the reimbursement in 2002 of the value of deposits made by Ukrainian citizens before 2 January 1992 in branches of the former USSR Savings Bank situated on Ukrainian territory (Про виплату в 2002 роцi грошових заощаджень громадян Украïни, вкладених до 2 сiчня 1992 р. в установи колишнього Ощадного банку СРСР, що дiяли на територiï Украïни). By that resolution, the Government allocated UAH 500,000,000 from the national budget to enable individual deposits to be indexed. Of that amount, UAH 65,000,000 was allocated to the heirs of account holders who had died between 1997 and 2002, on condition that they had not yet received the grant available under section 8 of Law no. 537/96. The remaining UAH 435,000,000 was to be divided between the other account holders. The amount payable to each beneficiary was, in principle, limited to UAH 150 for people from the first category and UAH 50 for people from the second.