CASE OF VEGH AND OTHERS v. ROMANIA

 

 

FOURTH SECTION

CASE OF VEGH AND OTHERS v. ROMANIA

(Applications nos. 13064/18 and 13 others)

 

 

 

 

JUDGMENT
 

STRASBOURG

30 November 2021

 

This judgment is final but it may be subject to editorial revision.

In the case of Vegh and Others v. Romania,

The European Court of Human Rights (Fourth Section), sitting as a Committee composed of:

 Gabriele Kucsko-Stadlmayer, President,
 Iulia Antoanella Motoc,
 Pere Pastor Vilanova, judges,
and Ilse Freiwirth, Deputy Section Registrar,

Having regard to:

the applications (nos. 13064/18, 13067/18, 13068/18, 13069/18, 13074/18, 13075/18, 13077/18, 13079/18, 13080/18, 24961/18, 51299/19, 51346/19, 51365/19 and 57915/19) against Romania lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (“the Convention”) by fourteen Romanian nationals, whose names are listed in the appended table, on the various dates indicated in the appended table;

the decision to give notice to the Romanian Government (“the Government”) of the complaints concerning the non-enforcement of the final judgments given in the applicants’ favour and the lack of effective remedies in that respect;

the parties’ observations;

Having deliberated in private on 9 November 2021,

Delivers the following judgment, which was adopted on that date:

INTRODUCTION

1.  The present case concerns the non-enforcement of an outstanding judgment given in the applicants’ favour in their capacity as former civil parties in criminal proceedings against the National Fund of Investment. It raises issues under Article 6 § 1 of the Convention and Article 1 of Protocol No. 1.

THE FACTS

2.  The applicants’ details are set out in the appended table.

3.  The Government were represented by their Agent, most recently Ms O. Ezer, of the Ministry of Foreign Affairs.

BACKGROUND TO THE CASE

4.  The factual and legal circumstances set out in the present applications are similar to those pertaining to the applicants in Albert and Others v. Romania ((dec.), no. 48006/11, 8 January 2013) and in the follow-up case Murărașu v.Romania ((dec.), no. 45733/10, 10 November 2015).

5.  In short, the applicants are former civil parties in the criminal proceedings concerning the National Investment Fund (Fondul Național de Investiții – “the FNI”; for a detailed presentation of that investment fund‑type entity, see Albert and Others, cited above, §§ 3-9).

6.  By a final judgment of 4 June 2009, the High Court of Cassation and Justice held in the applicants’ favour, establishing their right to receive damages to be paid from the State budget. That judgment has remained unenforced to the present day in respect of a large number of creditors, including the applicants in the present case (for relevant details of those proceedings, see Albert and Others, cited above, §§ 14-18).

INFORMATION SUBMITTED BY THE GOVERNMENT AND THE AUTHORITY FOR THE MANAGEMENT OF STATE ASSETS

7.  The Government submitted that out of a total of approximately 160,000 creditors, as established by twenty-three civil judgments and eight criminal judgments given in proceedings involving the FNI, more than 18,400 had already received their payments, amounting to approximately 428,000,000 lei (RON – approximately 94,000,000 euros (EUR)).

8.  Having regard to the payment requests which had been made by the time the Government’s observations were submitted to the Court, the total amount of money owed to the FNI creditors was RON 345,017,000 (around EUR 75,000,000).

9.  The Government contended that the relevant State authority, namely the Authority for the Management of State Assets (AAAS), had been making serious efforts to continue paying the outstanding debts to the FNI individual creditors, in spite of the increasing financial difficulties it was encountering on account of the high amounts to be paid and the lack of financing to cover them. In that connection, several legislative proposals and action plans aiming to implement concrete measures for the financing and repayment, including by instalments, of the outstanding debts had been formulated and submitted to the relevant ministries from 2017 onwards; however, none of the proposals had been adopted and no alternative has been put forward to the present day.

10.  The AAAS submitted that, because all their efforts to launch a ministerial discussion aiming to find solutions for the complex issue raised by the payment of such large amounts of money which exceeded their budget had remained completely unsuccessful, any possibility for them to continue repaying the FNI creditors had been fully impaired.

RELEVANT LEGAL FRAMEWORK AND PRACTICE

11.  The relevant background domestic law and practice in relation to the special measures for the enforcement of claims such as those submitted by the applicants (FNI creditors) are set out in Albert and Others (cited above, §§ 40‑45) and Murărașu (cited above, §§ 12-14).

12.  Concerning in particular the publication of specific information to the attention of all FNI creditors on the AAAS website, as presented in Murărașu (cited above, § 15), it is to be noted that at present there is no concrete information available as to the payment status, the number of creditors, or the amounts already paid or waiting to be paid in the relevant proceedings.

THE LAW

JOINDER OF THE APPLICATIONS

13.  Having regard to the similar subject matter of the applications, the Court finds it appropriate to examine them jointly in a single judgment (Rule 42 § 1 of the Rules of Court).

LOCUS STANDI

14.  The heirs of the applicant in application no. 13069/18 informed the Court of that applicant’s death and, as his close relatives, expressed their intention to pursue the application in his stead. The Government did not object to this. Having regard to the close family ties and the heirs’ legitimate interest in pursuing the application, the Court accepts that the deceased applicant’s heirs may pursue the application in his stead (see, among other authorities, Janowiec and Others v. Russia [GC], nos. 55508/07 and 29520/09, § 101, ECHR 2013). It will therefore continue to deal with this application at the heirs’ request (see the appended table for details).

ALLEGED VIOLATION OF ARTICLE 6 OF THE CONVENTION and of article 1 of Protocol No. 1 to the Convention

15.  The applicants complained of the non-enforcement of the final judgment of 4 June 2009 given in their favour in proceedings in which they had been civil parties against the FNI. They relied on Article 6 of the Convention and on Article 1 of Protocol No. 1 to the Convention, which in their relevant parts read as follows:

Article 6

“In the determination of his civil rights and obligations ... everyone is entitled to a fair ... hearing ... by [a] ... tribunal ...”

Article 1 of Protocol No. 1

“Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law.

The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties.”

Admissibility

16.  The Court notes that these complaints are neither manifestly ill‑founded nor inadmissible on any other grounds listed in Article 35 of the Convention. They must therefore be declared admissible.

MeritsThe parties’ submissions

(a)   The Government

17.  The Government argued that the complexity and the specificity of the present case called for a particular approach which would take into consideration the atypical issues raised by it. Indeed, the Court itself had emphasised in Albert and Others and Murărașu (both cited above) that the context generated by the collapse of the FNI had put the State in a difficult situation, thus justifying certain delays in the enforcement of the final judgments in the claimants’ favour.

18.  While acknowledging that the applicants had not received any payment yet, the Government concluded that the authorities had been making concrete efforts in good faith to comply with their obligations towards all the FNI creditors, including the applicants.

(b)   The applicants

19.  The applicants submitted that almost twenty years after they had launched proceedings against the FNI, and several years after the Court had adopted its decision in Murărașu (cited above), their claims had still not been satisfied and had no prospects of being satisfied.

The Court’s assessment

(a)   General principles

20.  The Court notes that the principles relevant to the present complaints are set out in, among other authorities, Burdov v. Russia (no. 2) (no. 33509/04, §§ 65-70, ECHR 2009), Foundation Hostel for Students of the Reformed Church and Stanomirescu v. Romania (nos. 2699/03 and 43597/07, §§ 55-60, 7 January 2014), Albert and Others (cited above, §§ 48‑52) and Murărașu (cited above, § 25).

(b)   Application of those principles to the present case

21.  The issue at stake in the present case has already been the subject of the Court’s examination (see paragraphs 4-6 and 11 above). At the relevant time, it found in two decisions, Albert and Others and Murărașu (both cited above) that, in view of the complexity of the legal and factual circumstances underlying the applicants’ claims, the as yet unclarified but very high number of creditors and the domestic authorities’ efforts to continue the repayment of the outstanding debts, the atypical, even if prolonged, non‑enforcement complained of did not disclose an appearance of a violation of the right of access to court under Article 6 of the Convention nor of the right to property under Article 1 of Protocol No. 1 (see Albert and Others, cited above, §§ 53-58, and Murărașu, cited above, § 33).

22.  The Court notes, however, that since the adoption of the above‑mentioned decisions in 2013 and 2015, respectively, several important elements on which it based its assessment of those cases have changed.

23.  In that regard, a much clearer picture concerning the total number of creditors and the total amount of the outstanding debt appears to have been given; indeed, the Government indicated concrete numbers and statistics in that respect (see paragraph 7-8 above).

24.  While noting that, regrettably, that concrete factual information is not available on the relevant domestic authority’s website (see paragraph 12 above), the Court nevertheless considers the clarification of the general picture concerning the amount of debt as well as the number of creditors to be beneficial; however, such clarification does not appear to be sufficient, having regard to the fact that the authority liable to pay the outstanding debts submitted, both before the domestic ministerial authorities and before the Court, that it lacked the necessary funds to continue repaying the established creditors, and that no action plan, alternative proposals or legislative solutions capable of offering an acceptable solution had been put forward (see paragraphs 9-10 above).

25.  The Court therefore notes that, notwithstanding the conclusions it has previously reached (see paragraph 21 above), and which relied on the essential criterion that, at the relevant time, the State had been making concrete efforts to continue the payments to those entitled to them, at present – that is, more than twelve years after the outstanding judgment had acknowledged the applicants’ enforceable claims (see paragraph 6 above) – there appears to be no foreseeable prospect of those claims being awarded to them.

26.  In that connection, the Court must reiterate that the complexity of the domestic enforcement procedure or of the State budgetary system cannot relieve the State of its obligation under the Convention to guarantee to everyone the right to have a binding and enforceable judicial decision enforced within a reasonable time. Nor is it open to a State authority to cite the lack of funds as an excuse for not honouring a judgment debt. It is for the Contracting States to organise their legal systems in such a way that the competent authorities can meet their obligations in this regard (see Burdov (no. 2), cited above, § 70).

27.  The foregoing considerations are sufficient to enable the Court to conclude that the authorities have not deployed sufficient and convincing efforts to be able to justify such a prolonged non-enforcement of the final and enforceable domestic judgment given in the applicants’ favour.

28.  Accordingly, the Court considers that there has been a violation of Article 6 of the Convention and Article 1 of Protocol No. 1 in the present case.

ALLEGED VIOLATION OF ARTICLE 13 OF THE CONVENTION

29.  The applicant in application no. 57915/19 complained that the national law did not offer an effective remedy against the State’s failure to enforce the outstanding judgment given in her favour. She relied on Article 13 of the Convention, which reads as follows:

“Everyone whose rights and freedoms as set forth in [the] Convention are violated shall have an effective remedy before a national authority notwithstanding that the violation has been committed by persons acting in an official capacity.”

30.  Having regard to the findings in paragraphs 25-27 above, the Court considers that it is not necessary to examine separately the admissibility and merits of this complaint (see, for instance, Kuzhelev and Others v. Russia, nos. 64098/09 and 6 others, § 140, 15 October 2019).

APPLICATION OF ARTICLE 41 OF THE CONVENTION

31.  Article 41 of the Convention provides:

“If the Court finds that there has been a violation of the Convention or the Protocols thereto, and if the internal law of the High Contracting Party concerned allows only partial reparation to be made, the Court shall, if necessary, afford just satisfaction to the injured party.”

Damage

32.  The applicants sought the payment of the outstanding judgment debt in respect of pecuniary damage.

33.  Some applicants also submitted claims in respect of non‑pecuniary damage, while one applicant left the amount to be awarded in that respect to the Court’s discretion (application no. 57915/19).

34.  The Government argued that those claims were excessive and submitted that the finding of a violation would constitute just satisfaction.

35.  The Court reiterates that the most appropriate form of redress in non‑enforcement cases is to ensure full enforcement of the domestic judgments in question (see, for instance, Đurić and Others v. Bosnia and Herzegovina, nos. 79867/12 and 5 others, § 36, 20 January 2015). This principle also applies to the present case, the Court considering that the full implementation of the findings of the outstanding judgment of 4 June 2009 (see paragraph 6 above) would ensure appropriate redress to the applicants.

36.  The Court further considers that the applicants sustained some non‑pecuniary damage arising from the breaches of the Convention found in this case. Making its assessment on an equitable basis, as required by Article 41 of the Convention, it awards under this head the amounts indicated in the appended table.

Costs and expenses

37.  The applicants claimed various amounts in respect of the costs and expenses incurred before the domestic courts and before the Court; some of them supported their claims with copies of their legal-services contracts.

38.  The Government argued that the amounts claimed were excessive and unsupported by appropriate evidence.

39.  According to the Court’s case-law, an applicant is entitled to the reimbursement of costs and expenses only in so far as it has been shown that these have been actually and necessarily incurred and were also reasonable as to their quantum (see, for example, Iatridis v. Greece (just satisfaction) [GC], no. 31107/96, § 54, ECHR 2000-XI, and Spahić and Others v. Bosnia and Herzegovina, nos. 20514/15 and 15 others, § 41, 14 November 2017).

40.  Regard being had to the information in its possession and the above criteria, as well as to the repetitive nature of the applications and hence of the submitted observations, the Court considers it reasonable to award each applicant the amounts indicated in the appended table.

Default interest

41.  The Court considers it appropriate that the default interest 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,

Decides to join the applications;Declares admissible, in respect of all applicants, their complaints raised under Article 6 § 1 of the Convention and Article 1 of Protocol No. 1 to the Convention concerning the non-enforcement of the domestic judgment of 4 June 2009;Holds, in respect of all applications, that there has been a violation of Article 6 § 1 of the Convention and Article 1 of Protocol No. 1 to the Convention concerning the non-enforcement of the domestic judgment of 4 June 2009;Holds that in application no. 57915/19 there is no need to examine the admissibility and the merits of the complaint under Article 13 of the Convention;Holds that the respondent State shall ensure, by appropriate means, within three months, the enforcement of the domestic judgment of 4 June 2009;Holds

(a)  that the respondent State is to pay the applicants, within three months, the amounts indicated in the appended table, plus any tax that may be chargeable to them, to be converted into the currency of the respondent State at the rate applicable at the date of settlement;

(b)  that from the expiry of the above-mentioned three months until settlement simple interest shall be payable on the above amounts at a rate equal to the marginal lending rate of the European Central Bank during the default period plus three percentage points;

Dismisses the remainder of the applicants’ claim for just satisfaction.

Done in English, and notified in writing on 30 November 2021, pursuant to Rule 77 §§ 2 and 3 of the Rules of Court.

 Ilse Freiwirth  Gabriele Kucsko-Stadlmayer
 Deputy Registrar President

APPENDIX

List of cases

 

No.

Application no.

Lodged on

Applicant
Year of Birth
Place of Residence
Nationality

Represented by

Non-pecuniary damage

(per applicant)

 

(in euros)

 

Costs and expenses

 

(in euros)

1.

13064/18

06/03/2018

Laurențiu-Ștefan VEGH
1971
Halchiu
Romanian

 

Adrian MÎLCU

2,000

94

2.

13067/18

06/03/2018

Jószef KARÁCSONY
1956
Sfântu Gheorghe
Romanian

 

Adrian MÎLCU

2,000

204

3.

13068/18

07/03/2018

Enikő FAIL
1953
Sfântu Gheorghe
Romanian

 

Adrian MÎLCU

2,000

184

4.

13069/18

07/03/2018

Ștefan VEGH
b:1938; d: 2020

 

Pursued by heirs

Laurențiu-Ștefan VEGH

(see application no. 13064/18 above)

 

Rodin-Attila VEGH

(see application no. 13074/18 below)
 

Adrian MÎLCU

2,000

235

5.

13074/18

07/03/2018

Rodin-Attila VEGH
1967
Sfântu Gheorghe
Romanian

 

Adrian MÎLCU

2,000

94

6.

13075/18

07/03/2018

Margareta Emilia KATONA
1944
Baraolt
Romanian

 

Adrian MÎLCU

2,000

204

7.

13077/18

07/03/2018

Carol KOLUMBÁN
1948
Baraolt
Romanian

 

Adrian MÎLCU

2,000

204

8.

13079/18

07/03/2018

Ion DIACONU
1953
Sfântu Gheorghe
Romanian

 

Adrian MÎLCU

2,000

204

9.

13080/18

07/03/2018

Antal KISS
1952
Sfântu Gheorghe
Romanian

 

Adrian MÎLCU

2,000

143

10.

24961/18

14/05/2018

Judit-Mária SZŐCS-BIRÓ
1979
Târgu Secuiesc
Romanian
Venczel HORVÁTH
1947
Sfântu Gheorghe
Romanian

 

Adrian MÎLCU

2,000

 

 

 

 

 

2,000

214

 

 

 

 

 

81

11.

51299/19

24/09/2019

Mihaela GHEORGHE
1985
Bucharest
Romanian

 

Alexandru
ROATA-PALADE

-

-

12.

51346/19

24/09/2019

Mircea DRĂGAN
1945
Bucharest
Romanian

 

Alexandru
ROATA-PALADE

-

-

13.

51365/19

24/09/2019

Alexandru DRĂGAN
1988
Bucharest
Romanian

 

Alexandru
ROATA-PALADE

-

-

14.

57915/19

26/11/2019

Georgeta PRETOR
1961
Bucharest
Romanian

 

Self-represented

2,000

-

 

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