FOURTH SECTION
PARTIAL DECISION
AS TO THE ADMISSIBILITY OF
Application no. 61390/00
by Ragnar VALIN
against Sweden
The European Court of Human Rights (Fourth Section), sitting on 4 May 2004 as a Chamber composed of:
SirNicolas Bratza, President,
MrM. Pellonpää,
MrsV. Strážnická,
MrJ. Casadevall,
MrS. Pavlovschi,
MrJ. Borrego Borrego,
MrsE. Fura-Sandström, judges,
and Mr M. O'Boyle, Section Registrar,
Having regard to the above application lodged on 20 June 2000,
Having deliberated, decides as follows:
THE FACTS
The applicant, Mr Ragnar Valin, is a Swedish national, who was born in 1949 and lives in Leksand. He is represented before the Court by Mr J. Thörnhammar, a lawyer practising in Stockholm.
The facts of the case, as submitted by the applicant, may be summarised as follows.
On 3 May 1993 the Tax Authority (skattemyndigheten) of the County of Dalarna decided to carry out a tax audit of KB Forward, a construction company owned by the applicant and his two brothers. The applicant was informed thereof the following day and on 13 May the Tax Authority visited the company's office and collected receipts and other documents relating to the company's bookkeeping. As a result of the audit, which ended on 18 October 1993, value-added tax (mervärdeskatt) for the period November 1991 – June 1993 was levied on the company. The tax totalled more than 7 million Swedish kronor (SEK) including tax surcharges. The amount was fixed following a discretionary assessment as the company's accounts were considered so deficient – in breach of the relevant provisions of the Accountancy Act (Bokföringslagen, 1976:125) – that they could not form the basis of an assessment. The Tax Authority further stated that the deficiencies had severely impeded the audit.
Unable to pay the above amount, the company was declared bankrupt on 16 December 1993, at its own request. The bankruptcy administrator found no reason to suspect that any criminal offence had been committed.
However, following the completion of the tax audit, the Tax Authority, on 17 January 1994, reported the matter to the public prosecutor in Falun who, on 18 March 1994, decided to initiate a preliminary investigation.
Furthermore, on 8 April 1994 the Tax Authority, in an application to the District Court (tingsrätten) of Leksand, requested that the applicant and his brothers be ordered to pay the outstanding value-added tax and tax surcharges, amounting to SEK 7,261,944, including late payment fees. The Tax Authority relied on section 48 a of the Value-Added Tax Act (Mervärdeskattelagen, 1968:430), according to which such a payment liability could be imposed on a representative of a company if he or she, wilfully or through gross negligence, had failed to duly pay the relevant tax. This case was settled in April 1998 by an agreement between the parties that the applicant and his brothers pay the State SEK 400,000 of the tax arrears. The agreement was confirmed by the District Court in a judgment of 7 May 1998.
On 8 May 1996 the applicant was interrogated by the public prosecutor. Evidence from certain witnesses was obtained during the autumn of 1996. The preliminary investigation was finalised on 2 July 1998. On 3 May 1999 the applicant was indicted for an aggravated bookkeeping offence (grovt bokföringsbrott) or, in the alternative, for having grossly impeded tax supervision (försvårande av skattekontroll, grovt brott).
The applicant moved for a dismissal of the criminal case on formal grounds. Referring to the 1998 settlement between the State and him and his brothers, he submitted that the matter was res judicata. Moreover, as the settlement concerned a tax debt which included tax surcharges, a conviction would involve a second criminal punishment, in breach of the principle of ne bis in idem. Finally, he claimed that the case should be dismissed as it had not been examined within a reasonable time.
By a decision of 25 January 2000, the District Court rejected the applicant's objections. It stated that the 1998 settlement, which had been reached in a civil case and had regulated the economic liabilities of the applicant and his brothers in relation to the State, could not determine any criminal liability. It also considered that the length of the proceedings was not unreasonable. The court further rejected the applicant's alternative request that the case be adjourned.
The applicant appealed and, by a decision of 31 January 2000, the District Court adjourned the case pending the outcome of the appeal.
On 6 April 2000 the Svea Court of Appeal (Svea hovrätt) upheld the District Court's decision. It noted that the facts in the public prosecutor's bill of indictment were different from those that had formed the basis of the applicant's payment liability under section 48 a of the Value-Added Tax Act. Accordingly, there was no identity between the two cases which could lead to the dismissal of the criminal case under Swedish law. Nor could the 1998 settlement imply that the applicant had been convicted of a crime within the meaning of Article 4 of Protocol No. 7 to the Convention. The appellate court further considered that Article 6 of the Convention did not imply that a criminal case should be dismissed because of an unreasonable delay in bringing an indictment; instead, such a delay could be taken into account at sentencing.
On 18 May 2000 the Supreme Court (Högsta domstolen) refused leave to appeal against the Court of Appeal's decision.
Subsequently, the applicant applied to the Supreme Court for the matter to be re-opened, referring to the lodging of the present case. Consequently, the District Court, on 27 September 2000, decided to cancel an already scheduled hearing. By a decision of 25 October 2000 the Supreme Court rejected the re-opening request.
On 13 and 14 February 2001 the District Court held an oral hearing in the case.
By a judgment of 28 March 2001 the District Court acquitted the applicant. In examining the impact of the length of the proceedings in the light of Article 6 of the Convention, the court first considered that the period at issue had started on 14 May 1993, when the Tax Authority had collected documentation at the company's office, and accordingly concluded that the proceedings, at the time of its judgment, had lasted almost eight years. It noted that, for the period between 18 October 1993, when the tax audit had been finalised, and 8 May 1996, when the applicant had been heard by the public prosecutor, no particular measures had been accounted for. Thereafter, save for the hearing of certain witnesses during the autumn of 1996, no action which had brought the investigation forward had been taken until 3 May 1999, when the applicant was indicted. However, the following delay of almost two years before the District Court was mainly due to the applicant's numerous requests for respites and the proceedings relating to his move for a dismissal of the case on formal grounds and could therefore not be counted in his favour when assessing whether the proceedings had been too long. The court continued:
“Still, the total time of the proceedings before the police and the public prosecutor has been remarkably long and during the major part of that period no action has been taken in order to make the case ready for a decision whether to prosecute. No information has come to hand which shows that the lengthy proceedings until the indictment was brought have been due to the applicant. Even if – as is common in these days – the lengthy proceedings could be imputed to a lack of resources at the police and prosecution authorities, it follows from the rather abundant case-law of the European Court of Human Rights ... that the fact that the courts are overburdened with work has not constituted an acceptable reason for delays in the proceedings. ... In the District Court's view, a similar approach could be taken in regard to corresponding circumstances within the police and prosecuting authorities in our country.
The District Court finds, in conformity with what the public prosecutor also appears to have found, that the proceedings thus far have not been compatible with Article 6 [of the Convention] nor, as the Convention has the status of law in Sweden, with Swedish law. “
Considering that the breach of the right to a hearing within a reasonable time had been of a particularly serious nature given the lack of activity under very long and continuous periods, the District Court went on to examine what impact this conclusion had on the case. In the absence of domestic legal provisions or case-law to that effect, the court found that a criminal case could not be dismissed due to lengthy proceedings save for the situations where it fell under the statute of limitations.
In examining the bookkeeping offence with which the applicant had been charged, the District Court noted that 120 receipts covering a very large amount of money had not been entered into the company's books and that, due to these deficiencies, the operation and result of the company had not been ascertainable. The investigation in the case did not show that the applicant, as responsible representative of the company, had acted with intent or gross negligence. Nevertheless, having failed to make sure that the bookkeeping had been handled by sufficiently competent and experienced personnel, the applicant had been negligent, especially as he did not have the necessary competence in these matters himself, and was thus guilty of a bookkeeping offence. However, the court found that the offence was not of an aggravated nature and, in so doing, took into account, inter alia, that the economic issues involved had been of a complex nature to the applicant, that he had not acted with the aim of evading tax or obtaining personal benefits and that a very long period of time had passed since the offence had been committed. As a consequence of its finding that the offence was not be classified as aggravated, the court concluded that it was statute-barred. It referred to the relevant provisions of the Penal Code (Brottsbalken), which provided that an offence like the one in question – for which the penalty was imprisonment for a period not exceeding two years – became statute-barred if the suspect had not been detained or notified of the charges against him within five years of the date when the offence had been committed.
In regard to the alternative charge, the District Court found that the deficient bookkeeping had impeded the Tax Authority's supervision of the company to such an extent that the applicant was criminally liable therefor. However, for the same reasons as those mentioned above in relation to the bookkeeping offence, the court considered that the offence was not of an aggravated nature and that, consequently, also this offence was statute-barred under the provisions of the Tax Offences Act (Skattebrottslagen, 1971:69) and the Penal Code.
No appeal was made against the District Court's judgment.
COMPLAINTS
1. The applicant complains that the criminal proceedings against him violated the principle of ne bis in idem, in view of the 1998 settlement of the tax case.
2. He also claims that he was not afforded a fair trial in the criminal proceedings, as the District Court could not review the underlying tax issues.
3. He finally complains of the length of the criminal proceedings.
THE LAW
1. The applicant complains of a violation of the principle of ne bis in idem. The Court finds that this issue falls to be considered under Article 4 § 1 of Protocol No. 7 to the Convention which provides the following:
“No one shall be liable to be tried or punished again in criminal proceedings under the jurisdiction of the same State for an offence for which he has already been finally acquitted or convicted in accordance with the law and penal procedure of that State.”
The applicant claims that, of the original tax amount levied by the Tax Authority on the company, SEK 800,000 represented a tax surcharge. Thus, when he and his brothers accepted the 1998 settlement with the State in the case concerning personal liability for the tax amount, part of the agreed amount related to the tax surcharge. He asserts therefore that, by virtue of the settlement, he was to be considered as already “convicted” and could not be tried for the criminal charges brought against him as, allegedly, the charges concerned the same acts as those that had been the basis for the imposition of the tax surcharge. He further submits that the District Court found him guilty of the charges in question.
The Court notes that the case concerning the applicant's and his brothers' personal liability to pay the company's value-added tax was concluded by a settlement with the State, according to which the three owners of the company agreed to pay a minor part of the amount claimed by the Tax Authority. The settlement was confirmed by the District Court in a judgment of 7 May 1998. Thus, even assuming that domestic remedies were exhausted in regard to this issue, that part of the agreed settlement amount concerned a tax surcharge and that the acts with which the applicant was charged in the criminal proceedings had the same essential elements as the conduct which formed the basis of the original imposition of a tax surcharge on the company, the Court finds that the applicant cannot be considered to have been “finally acquitted or convicted in accordance with the law and penal procedure” in the case concerning the personal payment liability. Thus, the subsequent indictment and trial concerning the bookkeeping offence and the tax supervision impediment did not involve a repetition of criminal proceedings in breach of the principle of ne bis in idem as expressed in Article 4 § 1 of Protocol No. 7 to the Convention.
It follows that this complaint is manifestly ill-founded and must be rejected in accordance with Article 35 §§ 3 and 4 of the Convention.
2. The applicant claims that he did not have a fair trial in the criminal proceedings, as the District Court could not review the underlying tax issues. Although he accepted the settlement of the tax case to save his personal economy, he still maintains that the Tax Authority's decision to levy the value-added tax in question was materially incorrect.
The Court, examining the present complaint under Article 6 § 1 of the Convention, notes that the applicant was acquitted by the District Court's judgment of 28 March 2001 and that the question therefore arises whether he can claim to be a victim of a violation of the right to a fair trial. In any event, the Court reiterates that he was charged with an aggravated bookkeeping offence or, in the alternative, for having grossly impeded tax supervision. The basis for both charges was the applicant's perceived responsibility for the company's deficient bookkeeping. There is no indication that the District Court, for any reason, was unable to fully examine these charges or the facts on which they were based. The question whether the information obtained at the Tax Authority's audit gave reason to levy tax and a tax surcharge on the company was a different issue which had no bearing on the criminal charges examined by the District Court. In conclusion, the present complaint reveals no evidence that the trial was unfair.
It follows that this complaint is also manifestly ill-founded and must be rejected in accordance with Article 35 §§ 3 and 4 of the Convention.
3. The applicant complains of the length of the criminal proceedings. This complaint also falls to be considered under Article 6 § 1 of the Convention which, in relevant parts, provides as follows:
“In the determination of ... any criminal charge against him, everyone is entitled to a ... hearing within a reasonable time ...”
The Court considers, in the light of the criteria established in its case-law on the question of “reasonable time” (the complexity of the case, the applicants' conduct and that of the competent authorities), and having regard to all the information in its possession, that an examination of the merits of this complaint is required.
For these reasons, the Court unanimously
Decides to adjourn the examination of the applicant's complaint relating to the excessive length of the criminal proceedings;
Declares the remainder of the application inadmissible.
Michael O'BoyleNicolas Bratza
RegistrarPresident
Full & Egal Universal Law Academy