Information Note on the Court’s case-law No. 146
November 2011
Pana and Others v. Romania (dec.) - 3240/03
Decision 15.11.2011 [Section III]
Article 34
Victim
Lack of clear and specific instructions by alleged victims to their representative: inadmissible
Facts – The thirteen applicants are individual shareholders in the International Bank of Religions (Banca Internaţională a Religiilor – BIR), and also a company, Investar International Holding. Following a petition in June 2000 by the National Bank of Romania, the county court declared BIR insolvent in July 2000 and decided to commence proceedings for its compulsory liquidation. The court dismissed objections lodged by seven shareholders as inadmissible, finding that they lacked locus standi. Appeals by BIR and the Procurator General were unsuccessful. In 2000 BIR’s shareholders referred the matter to the anti-corruption committees of the Senate and the Parliament. In September 2004 the report by the committees stated that BIR’s collapse had resulted from a series of illegal operations by the Government, the National Bank and the judges dealing with the case. Relying in particular on the report’s conclusions, BIR shareholders lodged some thirty criminal complaints against various persons, alleging that the bank’s compulsory liquidation had been fraudulent and complaining about the manner in which it had been conducted. They applied to join the proceedings as civil parties. However, their actions were unsuccessful.
Law – Article 34
(a) The application in respect of the BIR shareholders being represented – The twelve individual applicants and the applicant company had applied to the Court in due form in December 2002, in their own names. In a memorial appended to the application forms, signed by six of the thirteen applicants, they had stated that they were representing the 2,188 BIR shareholders and applying to the Court on their behalf. However, the memorial had not been accompanied by any authority form. In addition, the list had not included either the particulars of the shareholders referred to, as required by Rule 47 of the Rules of Court, or their signatures confirming the institution of proceedings, which would have given the Court an unequivocal indication of their intention to apply to it in their own names. Moreover, letters sent to the Court in December 2004 by Mr Pană, claiming to be the representative of the bank’s shareholders, revealed discrepancies in the treatment and number of the shareholders.
Furthermore, the power of attorney granted for the purpose of the present application to the first applicant, Mr Pană, in March 2006 by the BIR board and signed by its chairman could not be taken into account. Although it contained a reference to having been granted “to represent the interests of the bank’s shareholders”, it was likewise not accompanied by a list of the shareholders concerned, with their particulars and signatures.
As regards the decision of the general meeting of the bank’s shareholders dated July 2004, by which Mr Pană had been appointed to represent the shareholders before international bodies such as the European Court, the decision in question referred to the participation of an unspecified number of shareholders possessing 65.94% of the bank’s capital. In that connection, a letter from the applicants’ lawyer indicated that at the general meeting in February 2006 only 298 (13.6%) of the 2,188 shareholders had been present. Besides the question of the formal requirements, including quorum, for the adoption of decisions by a general meeting of shareholders of a company in liquidation and the question of the scope of such decisions, the Court did not have sufficient information to establish unequivocally that all the persons whose names were listed in the table, apart from the thirteen applicants who had lodged applications in due form, intended to apply to it in their own name.
The Court considered it essential for representatives to be able to show that they had received specific and explicit instructions from alleged victims within the meaning of Article 34 of the Convention. There was no indication in the case file that it had been impossible for the shareholders in question to comply with this simple yet crucial procedural requirement to submit a duly completed application together with a power of attorney. The letter sent to the Court in December 2004 by Mr Pană could not be regarded as an objective and insurmountable obstacle but reflected a perfectly normal situation in the life of a limited company, namely that there could be differences of opinion among its shareholders, which might become more serious in the event of the company’s liquidation.
Conclusion: inadmissible (incompatible ratione personae).
(b) The remainder of the application – The proceedings complained of had concerned only the bank in liquidation as a corporate entity, and not the applicants in their personal capacity. In that connection, the Court had always been mindful of the separate legal personality of companies, authorising the piercing of the “corporate veil” only in exceptional circumstances. In the present case, however, the bank in question had been able to take part in proceedings before the domestic courts, even after the procedure for its compulsory liquidation had commenced. The applicants had not shown that they were majority shareholders in the bank. In any event, not even the fact of holding a substantial portion of the shares was sufficient in principle for the applicants to qualify as “victims” within the meaning of Article 34. They should in addition have a personal interest in the subject-matter of the application, relating in particular to an infringement of their rights as shareholders. The applicants had not complained of a violation of their rights as shareholders of the bank in liquidation, such as the right to attend the general meeting and to vote. Nor had they alleged any damage other than that sustained by the bank in which they were shareholders, whereas the bank itself had not yet lodged a valid application with the Court relating to the facts of the case. The fact that the BIR board had granted Mr Pană a power of attorney in March 2006 to represent the interests of the bank’s shareholders before the Court could not be accepted in place of a proper application on behalf of the bank.
Conclusion: inadmissible (incompatible ratione personae).
© Council of Europe/European Court of Human Rights
This summary by the Registry does not bind the Court.
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