CASE OF LAGARDÈRE v. FRANCE [Extracts]
Violation of Article 6 - Right to a fair trial (Article 6 - Criminal proceedings;Article 6-1 - Fair hearing;Equality of arms);Violation of Article 6 - Right to a fair trial (Article 6 - Criminal proceedings;Article 6-2 - Presumption of innocence);Pecuniary damage - claim dismissed;Non-pecuniary damage - award
André Potocki;Ann Power-Forde;Dean Spielmann;Elisabet Fura;Ganna Yudkivska;Karel Jungwiert;Mark Villiger
5. The applicant was born in 1961 and lives in Paris. 6. The applicant’s father, J.-L. Lagardère, was chairman and managing director of the Matra and Hachette companies. 7. On 29 December 1992 Lambda, a company representing certain shareholders in Matra and Hachette, lodged a complaint for misappropriation of corporate assets, together with an application to join the proceedings as a civil party. 8. By an order of 21 June 1999, J.-L. Lagardère was sent before the Paris Criminal Court on suspicion of having, between 1988 and 1992, as chairman and managing director of Matra and Hachette in Paris, knowingly fraudulently misused assets of those companies against their interest, in particular by letting them bear the full cost of an annual licence fee equal to 0.2% of the two companies’ turnover, only part of which was justified, for his personal gain or to help another company in which he had a direct or indirect interest. 9. Two agreements were signed for the purpose: one on 1 October 1988, between Matra and the Arjil Group, and the other on 1 November 1988, between Hachette and the Arjil Group. They were adopted by the general assemblies of Hachette and Matra on 20 June 1989 and 26 June 1989 respectively. 10. In a judgment of 22 June 2000 the Paris Criminal Court declared the prosecution against J.-L. Lagardère time-barred, the starting point for the purposes of limitation being fixed at 20 and 26 June 1989, the dates of signature of the agreements by the shareholders. As a result, the court declared the civil party action brought by Lambda inadmissible. 11. On 22 and 28 June 2000 Lambda and the public prosecutor at the Paris tribunal de grande instance appealed. 12. In a judgment of 25 January 2002 the Paris Court of Appeal confirmed the judgment in all its provisions. Lambda appealed on points of law. 13. On 14 March 2003 J.-L. Lagardère died. 14. In a judgment of 8 October 2003, after declaring that the prosecution had lapsed, this time as a result of the accused’s death, the Criminal Division of the Court of Cassation quashed and annulled the judgment of the Paris Court of Appeal concerning the civil action, considering that the moment at which time had started to run for the purposes of limitation was the presentation of the auditors’ special report to the general assemblies, which post-dated the signature of the disputed agreements. The case was sent before the Versailles Court of Appeal. 15. Jean-Luc Lagardère’s heirs, his widow E.P.L. and the applicant, challenged that court’s competence to judge the civil action. 16. In a judgment of 30 June 2005 the Versailles Court of Appeal dismissed that objection, considering that the civil action continued when the offender’s death occurred after a decision on the criminal prosecution had been given. 17. It declared the instances of misappropriation of corporate assets committed in 1988 time-barred, but not those committed in the financial years 1989 to 1992. 18. The court accordingly considered that it had first to determine whether the constituent elements of the offence of misappropriation of corporate assets were established in respect of Arnaud Lagardère’s late father. To do this it examined “the personal interest” in the signature and execution of the contracts in issue, “whether they were against the corporate interests of Matra and Hachette”, and whether J.-L. Lagardère had acted in “bad faith”. It concluded its reasoning in the following terms: “the system set in place ... at the request of Mr [J.-L.] Lagardère ... constitutes the offence of misappropriation of corporate assets to the detriment of Matra and Hachette.” 19. The Court of Appeal explained that the profit had been 94,100,000 French francs (FRF), or 14,345,452.52 euros (EUR), without any real added value for the injured companies. 20. In the operative part of its judgment the Court of Appeal held: “that the constituent elements of the offence of misappropriation of corporate assets to the detriment Matra and Hachette are established for that period against Mr Jean-Luc Lagardère.” 21. In view of that finding the Court of Appeal ordered E.P.L. and the applicant, as the heirs, to pay the civil party EUR 14,345,452.52 in damages. 22. The applicant, E.P.L., Lambda and the Principal Public Prosecutor at the Court of Appeal appealed on points of law. In support of his appeal the applicant argued that there had been a violation of Article 6 of the Convention because the criminal court had no authority to judge the matter after his father’s death. 23. In his opinion on the appeal the advocate-general at the Court of Cassation, having examined the different possible solutions and the relevant legal theory and case-law, concluded that the Versailles Court of Appeal had no authority to judge the civil action after J.-L. Lagardère’s death. He also justified his opinion on principle. First, he pointed out that whatever the place reserved for the victim in the criminal trial, the judgment of the civil action remained contingent on the outcome of the criminal proceedings as it required the prior demonstration of the existence of an offence of which a particular individual was guilty, which ruled out the possibility of continuing the action against the heirs. He cited a passage from an authoritative work (Précis de procédure pénale, by Professors Stefani, Levasseur and Bouloc, 19th edition): “in our modern law we no longer bring actions against the dead or the memory of the dead”. Next, he explained that the need for a violation of the criminal law which was inherent in any decision of the criminal courts justified the fact that, for the court even to rule only on the civil action, the accused had to be given a criminal trial that respected the “principle that hearings must be oral ... and the adversarial nature of the trial, which was an essential component of a fair trial. In other words, in order for the criminal court to be able to rule, in both the criminal and the civil proceedings, there is a condition: the effective participation of the accused in his trial”. This meant that in order for the criminal court to be able to examine the civil action alone, it would be necessary for the accused “at one time or another, to have had an effective opportunity to submit his arguments in full concerning the presence and the solidity of all the constituent elements of the offence with which he has been charged, and his responsibility in the matter”. 24. In a judgment of 25 October 2006 the Court of Cassation declared the Principal Public Prosecutor’s appeal inadmissible and rejected those lodged by the applicant and E.P.L. 25. Regarding the arguments submitted by the applicant, the judgment read as follows: “In overruling the objection that the criminal court had no authority to hear the civil action brought by the heirs of [J.-L. Lagardère] because no decision had been given on the merits in the criminal proceedings prior to the death of the accused, the judgment states, among other things, that the proceedings and the judgment found that the prosecution was time-barred before the accused died; furthermore, the criminal court to which the case was remitted by the Court of Cassation is the only court competent to determine whether the prosecution was time-barred and whether, having regard to the civil claim, the constituent elements of the offence of misappropriation of corporate assets have been made out; In pronouncing itself in those terms the Court of Appeal justified its decision; Trial courts before which action was lawfully taken before the criminal prosecution lapsed continue to have jurisdiction in the civil proceedings...” 26. Ruling on the civil party claim, it quashed and annulled the judgment of the Court of Appeal solely on the issue of the capitalisation of the interest on the sums owed by J.-L. Lagardère’s heirs. On that occasion it noted that the Court of Appeal had “found JeanLuc Lagardère guilty”. 27. The relevant provisions of the Code of Criminal Procedure read as follows: “Anyone who has personally suffered damage directly caused by a criminal offence may bring civil-party proceedings to seek compensation for such damage. ...” “Civil-party proceedings may be conducted simultaneously with the public prosecution and before the same court. Civil-party proceedings may be brought for any head of damage, whether pecuniary or physical or non-pecuniary, caused by the acts under prosecution” “Civil-party proceedings may also be conducted separately from the public prosecution, before a civil court. However, judgment in civil-party proceedings brought in a civil court shall be suspended until final judgment has been given in any public prosecution. Setting the public prosecution in motion does not suspend the other actions before the civil court, whatever their nature, even if the decision to bring criminal proceedings is likely to directly or indirectly influence the outcome of the civil proceedings.” “A party who has brought proceedings in a civil court may not refer the same complaint to a criminal court unless the prosecution has preferred charges in that court before the civil court has ruled on the merits.” “The public prosecution for the imposition of a penalty is extinguished by the death of the defendant or by limitation, amnesty, the repeal of the criminal law and res judicata.” “When civil action is taken before a criminal court, limitation is governed by the rules of public prosecution. When the action is taken before a civil court, limitation is governed by the Civil Code. When the court has made a ruling on the public prosecution, the investigative measures ordered by the criminal court on the civil claims alone are governed by the rules of civil procedure.” 28. When criminal and civil proceedings are brought simultaneously before the criminal court, the civil action is considered contingent on the outcome of the criminal prosecution (see, for example, Court of Cassation, Criminal Division, 19 May 1969, Bull. crim. no. 173). 29. The public prosecution is extinguished by the death of the accused during the appeal on points of law. When the Investigations Division of the Court of Appeal decides to discontinue the proceedings, the criminal courts can no longer rule on the criminal proceedings and therefore have no authority to examine the civil action (Court of Cassation, Criminal Division, 5 May 1998, Bull. crim. no. 149). If the accused dies before any decision is reached on the merits, the criminal court has no authority to examine the civil action (Court of Cassation, Criminal Division, 7 March 1936; 9 September 2008, Bull. crim. no. 177). 30. The criminal courts can rule on the civil action only where a decision has been reached in the criminal proceedings (Court of Cassation, Criminal Division, 9 September 2008, Bull. crim. no. 177). In that case, when death occurs during the appeal or the appeal on points of law, the public prosecution is extinguished but the Court of Appeal and the Court of Cassation can still examine the civil claims (Court of Cassation, Criminal Division, 18 February 1915; 29 May 1978, Bull. crim. no. 169; 13 March 1997, Bull. crim. no. 104; 15 June 1977, Bull. crim. no. 221; 8 April 1991, Bull. crim. no. 166; 13 March 1995, Bull. crim. no 100; 22 May 1995, Bull. crim. no. 181). The Court of Appeal remains competent if death occurs after cassation but before the accused is summoned to appear before the court to which the case has been remitted (Court of Cassation, Criminal Division, 3 February 1965, Bull. crim. no. 32). The Court of Cassation must examine the grounds of appeal concerning both the civil action and the criminal prosecution, the latter serving as the basis for the former (Court of Cassation, Criminal Division, 13 March 1995, Bull. crim. no. 100).