FIFTH SECTION
DECISION
Application no. 21623/09
TU & CO AB
against Sweden
The European Court of Human Rights (Fifth Section), sitting on 21 May 2013 as a Chamber composed of:
Mark Villiger, President,
Ann Power-Forde,
Ganna Yudkivska,
André Potocki,
Paul Lemmens,
Aleš Pejchal, judges,
Johan Hirschfeldt, ad hoc judge,
and Claudia Westerdiek, Section Registrar,
Having regard to the above application lodged on 16 April 2009,
Having regard to the observations submitted by the respondent Government and the observations in reply submitted by the applicant,
Having regard to the decision taken by the President of the Chamber to appoint Mr Johan Hirschfeldt to sit as ad hoc judge (Article 26 § 4 of the Convention and Rule 29 § 1 of the Rules of Court), as Mrs Helena Jäderblom, the judge elected in respect of Sweden, had withdrawn from the case (Rule 28 of the Rules of Court),
Having deliberated, decides as follows:
THE FACTS
1. The applicant, TU & Co AB, is a Swedish limited liability company, which has its seat in Stockholm. The applicant company was represented before the Court by Mr T. Bodström, a lawyer practising in Stockholm. The Swedish Government (“the Government”) were represented by their Agent, Mr A. Rönquist, of the Ministry for Foreign Affairs.
A. The circumstances of the case
2. The facts of the case, as submitted by the parties, may be summarised as follows.
3. The applicant company runs the restaurant Undici Restaurant & Bar (Undici) in the centre of Stockholm. On 27 September 2007, the Social Council (Socialtjänstnämnden) decided to revoke Undici’s licence to serve alcoholic beverages on its premises. The decision was based partly on several reports from the Police Authority regarding disorder and excessive serving of alcohol on the premises and partly because the restaurant had served liquor by the bottle after 1 a.m. (which was prohibited). Moreover, the applicant company had failed to report to the authorities that its parent company, which was also its majority owner, was subject to liquidation as well as to report changes in the ownership structure of this company.
4. The applicant appealed against the decision and asked to have its alcohol licence back. On 8 November 2007, the County Administrative Court (länsrätten) of Stockholm held an oral hearing in the case during which the two shareholders of the applicant company and its parent company were heard as well as five witnesses, four at the request of the applicant. Both the shareholders and one of the witnesses, the liquidator of the applicant’s parent company, were heard about the circumstances relating to the liquidation and the applicant company’s ownership structure. The court also had written evidence at its disposal, inter alia, the applicant company’s register of shareholders from 2000 and its annual report from 2006.
5. On 21 November 2007, the court partly granted the applicant company’s appeal in that it repealed the revocation of the licence but gave the applicant company a warning instead. In its reasoning, the court stated that it was common ground between the parties that there had been changes in the ownership structure of the parent company and that this company had been liquidated. However, in the court’s view, these circumstances were not reason enough to revoke Undici’s licence to serve alcoholic beverages since the restaurant business was still run in the same way by the same persons. Turning to the issue of public disorder, the court noted that it was undisputed that disorder had occurred on seven different occasions and endorsed the Social Council’s view that this constituted grounds for revoking Undici’s licence to serve alcoholic beverages. However, having regard to the fact that almost all of the incidents had occurred during student parties, and to the applicant company’s assurance that such parties would never take place again, as well as the applicant company’s implementation of new policy documents, it found specific reasons to believe that the applicant company had a genuine will to deal with the problems which had previously occurred and, consequently, that the intervention could be limited to a warning.
6. The Social Council appealed to the Administrative Court of Appeal (kammarrätten) of Stockholm which, on 17 March 2008, decided to grant leave to appeal. The applicant company, as well as the Social Council, requested that an oral hearing be held in the case. The applicant company asked to hear the two shareholders previously heard before the County Administrative Court and four witnesses, three of whom were to be heard in person before the court. Only one of the witnesses, an advocate, had not been heard before the County Administrative Court and he was to testify that there was no reason to revoke the applicant company’s alcohol licence due to the changes in the ownership structure or the liquidation of the main shareholder.
7. On 18 June 2008, the Administrative Court of Appeal rejected the applicant company’s request for an oral hearing as being unnecessary and invited the applicant company to make its concluding submissions in the case, at the latest on 14 July 2008. The applicant company was granted an extension of time-limit and finalised its submissions in writing on 18 August 2008.
8. On 15 October 2008, the Administrative Court of Appeal repealed the County Administrative Court’s judgment and ruled in favour of the Social Council. The judgment was based on the fact that changes in the ownership structure and the shareholder’s liquidation had not been reported to the relevant authority. Additionally, it noted that a number of police reports indicated that repeated disruptions of public order had occurred, such as fighting and serving alcoholic beverages to young people and that people had been so intoxicated that the police had taken them into custody, including a person who was only 15 years old at the time. In the court’s view, it was an aggravating circumstance that the disruptions of public order were primarily related to student parties, involving mostly young people. Moreover, it was noted that a waitress, on 8 March 2007, had left a pitcher of liquor on a table for guests at the restaurant after 1 a.m. The Administrative Court of Appeal, referring to the fact that the applicant company had previously received warnings for failing to respect the rules for serving alcoholic beverages, did not find any specific reasons to limit the intervention to a warning.
9. The applicant company appealed to the Supreme Administrative Court (Regeringsrätten) and requested the court to hold an oral hearing. In response to a question by the court, the applicant company specified that it requested the oral hearing only if leave to appeal was granted.
10. On 24 October 2008, the Supreme Administrative Court refused leave to appeal.
B. Relevant domestic law
1. The Alcohol Act
11. The basic provisions mainly applicable in the present case are laid down in the Alcohol Act (Alkohollagen, 1994:1738). On 1 January 2011, this Act was replaced by a new Alcohol Act (2010:1622). Hereafter, reference is made to the older, now repealed, Act, which was in force at the time relevant to the present case.
12. An overriding principle of the Act is restraint in connection to serving alcoholic beverages. In accordance with Chapter 3, section 4, of the Act, the sale of beverages falling under the Act shall be conducted in such a manner that harmful effects are prevented as far as possible. Any person engaged in the sale of alcoholic beverages shall ensure that order and sobriety prevail at the point of sale. Under Chapter 6, section 2, of the Act, the serving of alcoholic beverages shall be conducted with restraint and may not lead to inconvenience with respect to public order and sobriety. Under the City of Stockholm’s guidelines for licences to serve alcoholic beverages, neither serving nor consumption of entire bottles of spirits (helrör) is allowed after 1.00 a.m.
13. Moreover, a person to whom a licence has been granted shall notify the licensing authority in the event of any change in the activity significant for the supervision. Notice shall also be given of important changes of ownership. Notice shall be given in advance. If the circumstances giving rise to the duty of notification could not have been foreseen, notification shall instead be made without delay (Chapter 8, section 3).
14. The municipality shall revoke a licence to serve alcoholic beverages if such inconveniences as referred to in Chapter 6, section 2, occur more than occasionally (Chapter 7, section 19, point 2). The municipality shall also revoke a licence to serve alcoholic beverages if the licensee does not comply with the provision of the Act applying to the service or licence, or with applicable provisions or conditions pursuant to the Act (ibid, point 3).
15. Instead of revocation, a licence may be issued with a warning if, for special reasons, a warning is deemed sufficient (Chapter 7, section 20). In accordance with the travaux préparatoires (Government Bill 1994/95:89, p. 110), an example of such special reasons is that the licensee has taken appropriate measures to correct the circumstances so that it may be assumed that the business will in future be operated in accordance with the applicable provisions.
2. Procedure before the administrative courts
16. Appeal against a decision rendered by the Social Council under the Alcohol Act lies to the administrative courts. However, in these cases leave to appeal is required for the Administrative Court of Appeal to consider an appeal on the merits against a decision or judgment delivered by the County Administrative Court (Section 34 a of the Administrative Court Procedure Act (Förvaltningsprocesslagen, 1971:291, hereinafter “the 1971 Act”). Likewise, leave to appeal is required for the Supreme Administrative Court to consider on the merits an appeal against a decision or judgment delivered by the Administrative Court of Appeal (Section 35 of the 1971 Act).
17. Section 9 of the 1971 Act is worded as follows:
“The procedure shall be in writing.
Where it may be assumed to be advantageous for the investigation or promote the expeditious determination of the case, the processing may include an oral hearing regarding certain issues.
In the Administrative Court of Appeal and the County Administrative Court an oral hearing shall be held if requested by an individual party to the proceedings, unless it is unnecessary or there are particular reasons against holding a hearing.”
18. The possibility for an individual party to obtain an oral hearing on request under those circumstances is not available in the proceedings before the Supreme Administrative Court.
19. The travaux préparatoires to the 1971 Act emphasise that an oral procedure can be advantageous for the investigation of a case in two respects in particular. Firstly, such a hearing may be needed in order to examine a witness, expert or party or in cases where a party has difficulty expounding his or her claim in writing. Secondly, an oral hearing may be needed to clarify the positions taken by the parties in the case and perhaps eliminate unnecessary or meaningless points of dispute. In the latter case, the procedure is typically of a preparatory nature. Moreover, the oral form of procedure envisaged in the 1971 Act is not to be seen as an alternative to the written form, but rather as a complement to that form (see the Government Bill 1971:30, p. 535).
20. Furthermore, the travaux préparatoires to the 1971 Act underlined, in connection with the provision in section 9 of the Act concerning the right of a party to an oral hearing in certain cases, that while serious consideration should be given to the wishes of a party for such a hearing, the party could hardly be allowed to have a decisive influence in the matter. The question of whether a hearing is necessary should primarily be assessed in the light of the existing investigation of the case, but it should also be possible to accord significance to other factors, for example, if the case is very important for the party and a hearing would give him a better understanding of the importance of the decision to be given in the case. One particular reason not to arrange an oral hearing could be that the case is of a trivial nature or that the costs of the hearing are high compared to the value of the object of dispute (see Government Bill 1971:30, p. 537).
21. In recent years the Supreme Administrative Court has set aside a number of decisions on appeal and referred cases back to the administrative courts of appeal because of the lack of an oral hearing in the lower courts (see, for example, RÅ 2002 ref. 23, RÅ 2003 note 68, RÅ 2004 note 65, RÅ 2007 note 171 and RÅ 2009 note 73).
3. Compensation for violations of the Convention
22. A comprehensive summary of the issue of compensation for violations of the Convention in the Swedish legal order can be found in Eskilsson v. Sweden ([dec.], no. 14628/08, 24 January 2012) and Eriksson v. Sweden (no. 60437/08, §§ 27-36, 12 April 2012).
COMPLAINT
23. The applicant company complained under Article 6 § 1 of the Convention that the lack of an oral hearing before the Administrative Court of Appeal was in violation of its right to a fair trial.
THE LAW
24. The applicant company complained that the decision of the Administrative Court of Appeal not to grant it an oral hearing of its case infringed upon its rights under Article 6 § 1 of the Convention. This provision reads in relevant parts:
“In the determination of his civil rights and obligations ... everyone is entitled to a fair ... hearing ... by [a] ... tribunal ...”
25. The Government claimed, primarily, that domestic remedies had not been exhausted since the applicant company still had the possibility to turn to the domestic courts or the Chancellor of Justice and claim compensation for the alleged breach of Article 6 of the Convention. In the Government’s view, the legal position of the domestic case-law in this regard was sufficiently clear at the time when the present application was lodged before the Court and, thus, provided a remedy for compensation for both pecuniary and non-pecuniary damage in respect of any breach of the Convention.
26. In the alternative, the Government alleged that the application should be declared inadmissible for being manifestly ill-founded. They claimed that it had been justified in the applicant company’s case to dispense with an oral hearing before the Administrative Court of Appeal because an oral hearing had been held before the County Administrative Court where four witnesses had been heard on the applicant company’s behalf. Moreover, the Administrative Court of Appeal had provided the applicant company with the possibility to make concluding submissions before deciding on the case. In this regard, the Government noted that the applicant company had been represented by legal counsel throughout the proceedings and that nothing indicated that the applicant company had had any difficulties in arguing its case in writing. The Government further emphasised that both the records of the Social Council and the County Administrative Court, which included transcripts and sound recordings of the examinations during the oral proceedings before the Administrative Court, constituted procedural material (processmaterial) to which the appellate court was obliged, ex officio, to give consideration. Accordingly, the Government found no reason to suggest that the applicant company’s interests had been improperly presented or protected.
27. Furthermore, the Government observed that of the two shareholders of the applicant company and its parent company and the four witnesses referred to by the applicant company before the Administrative Court of Appeal, five had previously been heard before the County Administrative Court. In their view, the sixth witness, who was to be heard about the change of ownership and the liquidation, would not have added anything of relevance to the case. The Government even asserted that the entire judgment of the Administrative Court of Appeal was based on facts undisputed by the parties and, accordingly, that none of the witnesses would have had any impact on the outcome of the case. In this regard, the Government further emphasised that, in accordance with the appellate court’s judgment, the disruptions of public order that had occurred in the applicant company’s restaurant constituted in themselves sufficient grounds for revoking the licence to serve alcoholic beverages. Consequently, the Government submitted that there had been exceptional reasons for dispensing with a hearing before the appellate court.
28. The applicant company maintained its claims. It emphasised that hearing the sixth witness before the appellate court would have been crucial for the outcome of the case and, thus, disputed the Government’s statement that the change of ownership or the liquidation would not have had any impact on the appellate court’s conclusion. In its opinion, the appellate court’s judgment had been based on circumstances which the applicant company had not had the opportunity to respond to adequately. Moreover, the applicant company stressed that it had not waived its right to an oral hearing before the appellate court. The reason for this was that the applicant company had only become aware of the need to hear the sixth witness due to events that had taken place during the oral hearing before the County Administrative Court and the subsequent appeal process.
29. The Court notes from the outset that the Government has raised the issue of non-exhaustion of domestic remedies. While the Court has accepted that, in principle, there now exists an effective remedy in Sweden (see Eriksson, cited above, §§ 50-52), this reasoning cannot be applied to the present case since it was lodged with the Court on 16 April 2009, that is, prior to the Supreme Court’s judgment (3 December 2009) marking the existence of an effective domestic remedy (ibid., §§ 45 and 53). In any event, the Court does not find it necessary to consider this matter in further detail since the case is inadmissible for the reasons set out below.
30. As concerns the right to an oral hearing, the Court reiterates that, in proceedings before a court of first and only instance, the right to a “public hearing” under Article 6 § 1 of the Convention entails an entitlement to an oral hearing unless there are exceptional circumstances which justify dispensing with it. Also, provided a public hearing has been held at first instance, a less strict standard applies to the appellate level, at which the absence of such a hearing may be justified by the special features of the proceedings at issue (see, for example, Fexler v. Sweden, no. 36801/06, § 58, 13 October 2011). Thus, leave to appeal proceedings and proceedings involving only questions of law, as opposed to questions of fact, may comply with the requirements of Article 6, although the parties were not given an opportunity to be heard in person by the appeal or cassation court. Regard must be had to the nature of the national appeal system, to the scope of the appellate court’s powers and to the manner in which the applicant’s interests are actually presented and protected in the appeal proceedings, particularly in the light of the nature of the issues to be decided by the appellate court, and whether these raise any questions of fact or law which cannot be adequately resolved on the basis of the case file. The Court considers that this less strict standard should also apply if an oral hearing has been waived at first instance and requested only on appeal. In the interests of the proper administration of justice, it is normally more expedient that a hearing be held at first instance rather than later before the appellate court (see, for instance, Miller v. Sweden, no. 55853/00, §§ 29‑30, 8 February 2005).
31. The Court further reiterates that, as concerns criminal proceedings, it has previously stated that the fact that an appellate court overturns an acquittal of a first-instance court without hearing the applicant in person does not of itself infringe Article 6 § 1 of the Convention (Keskinen and Veljekset Keskinen Oy v. Finland, no. 34721/09, § 34, 5 June 2012).
32. Turning to the present case, the Court notes that the applicant company was granted an oral hearing before the court of first instance, where four witnesses and both of the applicant company’s shareholders were heard on the applicant company’s behalf. Accordingly, the Court finds that a less strict standard should apply in this case as to the assessment of the applicant’s right to an oral hearing before the appellate court.
33. The Court further notes that, out of the six witnesses whom the applicant company requested to have heard, only one had not previously been heard. As concerned the five already heard in person before the County Administrative Court, the applicant company requested that two of them testify anew in person while, for the three others, their recorded testimony from the lower court should be shown before the appellate court during the hearing. In accordance with the applicant company’s submissions, the two witnesses who were requested to testify anew were to be heard about a particular occasion when Undici had allegedly served liquor by the bottle after 1 a.m. as well as about the applicant company’s work to improve order and safety. As far as the Court is aware, the applicant company did not provide the appellate court with any information about the purpose of a re-hearing of these witnesses or what they intended to add to their previous statements. Neither has any such explanation been submitted to the Court. Accordingly, the Court finds that the applicant company has failed to show that a re‑hearing of these two witnesses would have provided new information of relevance to the determination of the case.
34. As to the new witness whom the applicant company requested to have heard, he was to testify that there was no reason to revoke the applicant’s alcohol licence due to the changes in the ownership structure or the liquidation of the main shareholder. The Court observes that the applicant company did not present any evidentiary fact before the appellate court, which could have provided a detailed explanation of the grounds for which this testimony, in the applicant company’s view, was decisive for the court’s assessment. Nor did it explain in which way this witness would add new, relevant information concerning the facts in question. The Court also observes that these facts had already been addressed by one of the shareholders and witnesses heard before the County Administrative Court, and that this testimony seemed to have been presented before the appellate court through sound recordings. It can therefore reasonably be considered that the applicant company has failed to demonstrate, in concrete terms, why the new witness’s testimony was of importance for the appellate court’s assessment.
35. Finally, the Court observes that the applicant company was represented by a lawyer throughout the proceedings and, when informed that the appellate court had rejected its request for an oral hearing, was invited to make its concluding submissions within a reasonable time-limit. Moreover, all records of the Social Council and the County Administrative Court were at the appellate court’s disposal. Thus, although the case concerned a matter decisive for the applicant company’s possibility to continue to run its business and did not only involve questions of law but also of fact, the Court considers that the applicant company’s interests were properly protected.
36. In the light of the above, the Court finds no indications that the applicant company’s case could not be adequately resolved on the basis of the case file and the written submissions. Accordingly, the Court finds that the absence of an oral hearing before the Administrative Court of Appeal was justified in this case.
37. It follows that the application is manifestly ill-founded within the meaning of Article 35 § 3 (a) of the Convention and must be rejected in accordance with Article 35 § 4.
For these reasons, the Court unanimously
Declares the application inadmissible.
Claudia WesterdiekMark Villiger
RegistrarPresident
Full & Egal Universal Law Academy