FOURTH SECTION
CASE OF HARASZTHY AND OTHERS v. HUNGARY
(Application no. 71256/11)
JUDGMENT
STRASBOURG
14 June 2016
This judgment is final but it may be subject to editorial revision.
In the case of Haraszthy and Others v. Hungary,
The European Court of Human Rights (Fourth Section), sitting as a Committee composed of:
Krzysztof Wojtyczek, President,
Egidijus Kūris,
Iulia Motoc, judges,
and Fatoş Aracı, Deputy Section Registrar,
Having deliberated in private on 24 May 2016,
Delivers the following judgment, which was adopted on that date:
FACTS AND PROCEDURE
1. The case originated in an application (no. 71256/11) against Hungary lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (“the Convention”) by six Hungarian nationals, Mr László Haraszthy, Mr György László Márton, Mr Gábor Horn, Ms Nóra Siska, Mr Zoltán Pintér and Ms Mária Terézia Oszter (“the applicants”), on 11 November 2011.
2. The applicants were represented by Mr I. P. Horváth, a lawyer practising in Budapest. The Hungarian Government (“the Government”) were represented by Mr Z. Tallódi, Agent, Ministry of Justice.
3. On 31 August 2015 the applicants’ complaints under Article 1 of Protocol No. 1 to the Convention concerning the imposition of 98% tax on their severance payment were communicated to the Government.
I. THE FIRST FIVE APPLICANTS
4. On 9 November 2015 and 4 January 2016 the Court received friendly settlement declarations signed by the Government and by five applicants under which these five applicants agreed to waive any further claims against Hungary in respect of the facts giving rise to their complaints against an undertaking by the Government to pay Mr László Haraszthy EUR 12,800 (twelve thousand eight hundred euros), Mr Görgy László Márton EUR 3,200 (three thousand two hundred euros), Mr Gábor Horn EUR 1,000 (one thousand euros), Ms Nóra Siska EUR 5,300 (five thousand three hundred euros) and Mr Zoltán Pintér EUR 7,100 (seven thousand one hundred euros) to cover any pecuniary and non-pecuniary damage as well as costs and expenses, which will be converted into Hungarian forints at the rate applicable on the date of payment, and will be free of any taxes that may be applicable. It will be payable within three months from the date of notification of the decision taken by the Court. In the event of failure to pay this sum within the said three-month period, the Government undertook to pay simple interest on it, from the expiry of that period until settlement, at a rate equal to the marginal lending rate of the European Central Bank during the default period plus three percentage points. The payment will constitute the final resolution of the case in respect of these five applicants.
II. THE SIXTH APPLICANT
5. The sixth applicant, Ms Mária Terézia Oszter was born in 1949 and lives in Budakeszi. From 1 July 1997 she was employed at the State-owned National Asset Management Ltd. Her employment was terminated on 30 May 2011. A certain part of her severance payment was subject to special tax at a 98% rate. Accordingly, special tax was levied on her severance payment in the amount of HUF 2,195,835 (approximately EUR 7,300).
THE LAW
6. The Court takes note of the friendly settlement reached between the Government and the five applicants. It is satisfied that the settlement is based on respect for human rights as defined in the Convention and its Protocols and finds no reasons to justify a continued examination of the first five applicants’ complaints. In view of the above, it is appropriate to strike this part of the application out of the list.
ALLEGED VIOLATION OF ARTICLE 1 OF PROTOCOL No. 1 TO THE CONVENTION
7. The sixth applicant complained about the imposition of 98 % tax on part of her remuneration due on termination of her employment. She relied on Article 1 of Protocol No. 1.
The Government did not dispute the applicant’s allegations.
8. The Court notes that the complaint is not manifestly ill-founded within the meaning of Article 35 § 3 (a) of the Convention. It further notes that it is not inadmissible on any other grounds. It must therefore be declared admissible.
9. The Court observes that virtually identical circumstances gave rise to a violation of Article 1 of Protocol No. 1 in the case of R.Sz. v. Hungary (no. 41838/11, 2 July 2013, §§ 54-62); and is satisfied that there is no reason to hold otherwise in the present application.
It follows that there has been a violation of Article 1 of Protocol No. 1.
10. Relying on Article 41 of the Convention, the sixth applicant claimed some pecuniary and non-pecuniary damage to be awarded in line with the Court’s case-law.
11. Having regard to the fact that, in the absence of the 98% tax rate, the applicant’s severance would have been in all likelihood subject to the general personal income taxation, the Court awards the sixth applicant EUR 6,100 (six thousand one hundred euros) in respect of pecuniary and non-pecuniary damage combined.
12. The sixth applicant claimed the reimbursement of costs and expenses incurred before the Court to be awarded in line with the Court’s case-law.
13. Having regard to all materials in the case file, the Court finds it reasonable to award the sixth applicant EUR 500 each, plus any tax that may be chargeable.
14. The Court considers it appropriate that the default interest rate should be based on the marginal lending rate of the European Central Bank, to which should be added three percentage points.
FOR THESE REASONS, THE COURT, UNANIMOUSLY,
1. Takes note of the friendly settlement reached between the Government and the first five applicants;
2. Decides to strike the application out of its list of cases in so far as it relates to the complaints of the first five applicants in accordance with Article 39 of the Convention;
3. Declares the remainder of the application admissible;
4. Holds that there has been a violation of Article 1 of Protocol No. 1 to the Convention with regard to the sixth applicant;
3. Holds
(a) that the respondent State is to pay the sixth applicant, Ms Mária Terézia Oszter, within three months the following amounts, to be converted into Hungarian forints at the rate applicable at the date of settlement:
(i) EUR EUR 6,100 (six thousand one hundred euros), plus any tax that may be chargeable, in respect of pecuniary and non-pecuniary damage; and
(ii) EUR 500 (five hundred euros), plus any tax that may be chargeable to the applicant, in respect of costs and expenses;
(b) that from the expiry of the above-mentioned three months until settlement simple interest shall be payable on the above amount at a rate equal to the marginal lending rate of the European Central Bank during the default period plus three percentage points.
Done in English, and notified in writing on 14 June 2016, pursuant to Rule 77 §§ 2 and 3 of the Rules of Court.
Fatoş AracıKrzysztof Wojtyczek
Deputy RegistrarPresident
Full & Egal Universal Law Academy