Communicated on 23 February 2011 and 3 April 2017
THIRD SECTION
Application no. 64098/09
Viktor Ivanovich KUZHELEV against Russia
and 3 other applications
(see list appended)
STATEMENT OF FACTS
The applicants are four Russian nationals living in St Petersburg. Their personal details are set out in Appendix I.
The circumstances of the case
The facts of the case, as submitted by the applicants, may be summarised as follows.
1. Information on the applicants’ former employer and its restructuring as an open joint-stock company in 2007
(a) The employer company
The applicants are former employees of the Kronstadt Marine Plant (Kronshtadtskiy morskoy zavod – “the Marine Plant”), one of the oldest and largest shipyards in Russia, incorporated between 1997 and 2015 as a State unitary enterprise (“the FGUP”) of the Russian Ministry of Defence. It primarily provided various services to that Ministry, such as maintaining and repairing military ships and their weaponry, and shipbuilding for the Russian Navy. The FGUP had “a right of economic control” (право хозяйственного ведения) over the assets allocated to it in order to carry out its statutory activities (for further details on the legal status of unitary enterprises in Russia, see in so far as relevant, Liseytseva and Maslov v. Russia, nos. 39483/05 and 40527/10, §§ 55-75, 9 October 2014).
At some point insolvency proceedings were opened in respect of the FGUP. On 14 March 2005 the St Petersburg Commercial Court put the FGUP into external administration (внешнее управление) for a period of eighteen months and appointed an administrator (внешний управляющий).
(b) Creation of an OAO, transfer of assets and the applicants’ employment
By a decision of 25 December 2006 the external manager acting on behalf of the FGUP created the open joint-stock company Kronstadt Marine Plant Awarded the Order of Lenin (Kronshtadtskiy morskoy ordena Lenina zavod – “the OAO”) and transferred the major assets allocated under the FGUP’s economic control to the OAO as a capital contribution, with effect from 1 March 2007.
The FGUP employees, including the applicants, were accordingly registered as working for the OAO from that later date.
On 9 February 2007 the FGUP’s assets were transferred to the OAO.
The military prosecutor’s office challenged the decisions to create the OAO and transfer the assets, claiming that they were unlawful and void ab initio.
On 19 October 2007 the St Petersburg Commercial Court allowed the prosecutor’s action and held that before transferring the assets to the OAO the external manager had failed to comply with a mandatory requirement, namely to obtain an expert opinion from a specialist Federal State Assets Management Agency. The court declared the creation of the OAO and the transfer null and void, and ordered the assets to be returned to the FGUP.
On 29 April 2008 the Commercial Court of the North-West Circuit upheld the judgment at final instance.
In May 2008 the OAO advised the applicants of their potential dismissal and on 21 August 2008 dismissed them from their jobs.
The applicants submit that between August and November 2008 the FGUP refused to reinstate them in their jobs and to allow them access to their workplace.
2. Proceedings against the OAO
(a) Court writs in the applicants’ favour against the OAO
Shortly after the annulment of the above-mentioned transaction, a local prosecutor brought proceedings against the OAO on behalf of the applicants seeking unpaid wages for the period June to August 2008 and in some cases, severance pay. On the dates listed in Appendix I the Justice of the Peace of the 110th Court Circuit of St Petersburg awarded the applicants the amounts claimed in separate court writs (судебные приказы). They took effect ten days later but have never been enforced.
(b) Application for the FGUP to substitute the debtor
In 2008 the applicants applied to have the debtor in the domestic proceedings (the OAO) substituted. They argued that, since the creation of the OAO had been declared null and void and all the assets were to be returned to the FGUP, the latter was liable to pay the judgment debts made against the OAO.
On the dates specified in Appendix I the Justice of the Peace of the 110th Court Circuit of St Petersburg allowed the application at first instance. She held that as the transaction had been voided, no transfer of rights or obligations to the OAO had taken place, and therefore the transfer of the employer’s rights and obligations to the OAO had also been unlawful. The Justice of the Peace applied a civil-law provision on legal succession and ordered the FGUP to pay the OAO’s debts under the judgments.
On various dates in 2009 listed in Appendix I the Kronstadt District Court of St Petersburg quashed the above-mentioned decisions. It found that the annulment of the decisions to create the OAO and transfer assets had not given rise to legal succession. The court specified that the transfer of assets from the OAO to the FGUP had not automatically resulted in the debts being transferred. The court also observed that the decision on legal succession had been issued in the absence of the respondent’s representatives, in violation of its procedural rights.
(c) Adjustment proceedings
It is apparent from the parties’ observations received in 2011 that on various dates in 2010 the same Justice of the Peace adjusted the compensation by applying the consumer price index. The amounts are specified in column 5 of Appendix I. The relevant judgments have not been enforced.
(d) Insolvency proceedings in respect of the open joint-stock company
On 13 February 2009 the St Petersburg Commercial Court declared the OAO insolvent and the liquidation process began. On 29 March 2012 the same court discontinued the insolvency proceedings and ordered the OAO’s liquidation. The creditors’ claims, which had not been satisfied during the liquidation process, including the applicants’ claims, were considered as settled.
On 31 May 2012 the OAO’s liquidation was recorded in the Register of Legal Entities, and it ceased to exist.
3. Judgments in the applicants’ favour against the FGUP and their enforcement
In 2008 the applicants brought proceedings against the FGUP challenging their dismissal, requesting to be allowed to work on 21 August 2008, the date of their actual re-employment. They also claimed unpaid wages and other work-related payments from 1 March 2007.
(a) Proceedings for reinstatement of employment
In November 2008, pursuant to the annulment of the decisions to create the OAO and transfer the FGUP’s assets, the applicants obtained separate judgments reinstating them in their jobs with the FGUP from 21 August 2008, the date following their dismissal from the OAO.
(b) Proceedings for unpaid wages for August to November 2008
On the dates specified in Appendix II the Kronstadt District Court examined the claims for unpaid wages and in separate judgments allowed them in part. It reiterated that the restructuring of the FGUP into the OAO had been rendered void in court. Accordingly, the OAO had not acquired ownership of the FGUP’s assets, and the transfer of the employer’s rights and duties from the FGUP to the OAO had been unlawful. The applicants’ employment with the FGUP had therefore not actually been discontinued. The court awarded them their unpaid wages from 21 August 2008 to the dates of the relevant judgments, and rejected the remainder of the claims. In particular, it refused to order the FGUP to pay the severance pay and unpaid wages for June to August 2008, as those claims had already been allowed in the proceedings against the OAO (see above).
(c) The applicants’ dismissal in March 2009 and subsequent proceedings for damages
In early March 2009 the applicants were dismissed from the FGUP. After three to four weeks they received severance pay and various other payments related to their previous employment. They also brought separate sets of proceedings claiming unpaid wages, severance pay and index-linking on those amounts. On various dates their claims were allowed in so far as they concerned the delay in payment of their severance package. They were awarded default interest and compensation for non-pecuniary damage for that period, in the amounts specified in Appendix I. The court rejected the remainder of their claims.
(d) Enforcement of the above-mentioned judgments
In December 2009 the FGUP started paying the amounts awarded in both sets of proceedings, in several instalments. By 24 November 2010 they were paid in full. On 30 November 2010 the enforcement proceedings in respect of the judgments were discontinued because they had all been enforced.
(e) Decision to discontinue insolvency proceedings and subsequent developments
In 2009 the Commander-in-Chief of the Russian Navy advised the FGUP’s employees’ representatives that the Marine Plant was included in a list of organisations of strategic importance entitled to receive a subsidy from the federal budget between 2008 and 2010 in order to resolve the FGUP’s financial difficulties. In 2010 the insolvency proceedings in respect of the Marine Plant were discontinued owing to a friendly settlement between the FGUP and its creditors, which was approved by the Commercial Court of St Petersburg and the Leningrad Region on 25 February 2010. It also appears that the Marine Plant was in operation until 2015, when it was restructured and transformed into a different legal entity (a newly created joint-stock company). On 20 April 2015 the restructuring of the company was recorded in the Register of Legal Entities, and the FGUP ceased to exist.
(f) The Government’s submissions on the adjustment of the awards against the FGUP
The Government submitted in their observations that at some point the unpaid wages had been index-linked and the applicants had received compensation for non-pecuniary damage. They did not submit any further details or documents in that respect.
COMPLAINTS
The applicants complain under Article 6 of the Convention and Article 1 of Protocol No. 1 to the Convention about the delayed enforcement by the FGUP of the judgments listed in Appendix II.
They further complain under Article 6 of the Convention and Article 1 of Protocol No. 1 to the Convention about the non-enforcement of the judgments in their favour against the OAO specified in Appendix I.
ADDITIONAL QUESTIONS TO THE PARTIES
1. Are the debts of the open joint-stock company OAO Kronshtadtskiy morskoy ordena Lenina zavod attributable to the State? In the alternative, has the State provided due assistance to the applicants in obtaining enforcement of the judicial awards given against the OAO?
2. Have the judicial awards in the applicants’ favour against the open joint-stock company OAO Kronshtadtskiy morskoy ordena Lenina zavod, as subsequently index-linked (see columns 3 and 5 of Appendix I) been enforced? If not, has there been a violation of Article 6 of the Convention and Article 1 of Protocol No. 1 to the Convention on account of the non‑enforcement of those judicial awards?
3. Did the applicants have an effective domestic remedy in respect of their non-enforcement complaints against the OAO as required by Article 13 of the Convention?
4. In Ms Lebedeva’s case, has there been a violation of Article 6 of the Convention and Article 1 of Protocol No. 1 to the Convention on account of the non-enforcement of the judgment dated 3 August 2009 in her favour issued against the FGUP? Has she suffered a significant disadvantage within the meaning of Article 35 § 3 (b) of the Convention?
Appendix
Proceedings against the OAO
No.
Column 1
Application No.
Lodged on
Column 2
Applicant
Date of birth
Column 3
Court writs in the applicants’ favour by the Justice of the Peace of the 110th Court Circuit of St Petersburg against the joint-stock company (OAO)
Column 4
Application for the FGUP to substitute the debtor (the OAO)
Column 5
Claim to have the initial award made by the same Justice of the Peace index-linked
Date
Domestic award
Russian roubles (RUB)
Euros (EUR)
1.
64098/09
16/11/2009
Viktor Ivanovich KUZHELEV
01/09/1946
09/10/2008
RUB 34,916
(EUR 981)
25/12/08 granted (1st instance)
29/05/09 quashed on appeal, request disallowed
17/06/2010
RUB 6,213 (EUR 162)
2.
64891/09
27/11/2009
Yelena Feodosyevna PAVLOVA
29/03/1953
24/10/2008
RUB 30,856
(EUR 892)
11/01/09 granted (1st instance)
29/05/09 quashed on appeal, request disallowed
22/06/2010
RUB 5,981 (EUR 156)
3.
67406/09
18/11/2009
Vera Alekseyevna PETROVA
24/01/1947
30/10/2008
RUB 35,197
(EUR 1,020)
29/12/08 granted (1st instance)
18/05/09 quashed on appeal, request disallowed
18/06/2010
RUB 6,932 (EUR 181)
4.
67697/09
25/11/2009
Natalya Leonidovna LEBEDEVA
24/10/1957
25/11/2008
RUB 35,874
(EUR 1,028)
11/01/09 granted (1st instance)
26/05/09 quashed on appeal, request disallowed
06/08/2010
RUB 7,045 (EUR 179)
Appendix II
Proceedings against the FGUP
No.
Column 1
Application No.
Column 2
Applicant
Column 3
Nature of the proceedings
Column 4
Domestic court
Column 5
Date of judgment,
date judgment became final
Column 6
Domestic award
64098/09
KUZHELEV
Unpaid wages between 21 August 2008 and the date of the domestic decision
Kronstadt District Court of St Petersburg
28/11/2008
21/01/2009
RUB 30,582
(EUR 864)
Damages for delay in payment of severance package
Kronstadt District Court,
as amended on appeal by the St Petersburg City Court
22/06/2009,
22/07/2009
RUB 1,194
(EUR 27)
64891/09
PAVLOVA
Unpaid wages since August 2008
Kronstadt District Court
01/12/2008
21/01/2009
RUB 25,504
(EUR 720)
Damages for delay in payment of severance package
Kronstadt District Court,
as amended on appeal by the St Petersburg City Court
19/06/2009
22/07/2009
RUB 1,280
(EUR 29)
67406/09
PETROVA
Unpaid wages since August 2008
Kronstadt District Court
28/11/2008
21/01/2009
RUB 25,196
(EUR 712)
Damages for delay in payment of severance package
Kronstadt District Court
23/06/2009
22/07/2009
RUB 122
(EUR 3)
67697/09
LEBEDEVA
Unpaid wages since August 2008
Kronstadt District Court
02/12/2008
21/01/2009
RUB 30.924
(EUR 873)
Damages for delay in payment of severance package
Kronstadt District Court
03/08/2009
02/09/2009
RUB 1,000
(EUR 22)
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