FIFTH SECTION
DECISION
Application no. 46973/07
VVD, TOV
against Ukraine
The European Court of Human Rights (Fifth Section), sitting on 23 August 2016 as a Committee composed of:
André Potocki, President,
Ganna Yudkivska,
Síofra O’Leary, judges,
and Milan Blaško, Deputy Section Registrar,
Having regard to the above application lodged on 9 October 2007,
Having regard to the observations submitted by the respondent Government and the observations in reply submitted by the applicant,
Having deliberated, decides as follows:
THE FACTS
The applicant, VVD, TOV, was a Ukrainian limited liability company, established in Kyiv. It was represented before the Court by Mr V. Konstantinov and Mr V. Nagacevschi, lawyers practising in Chisinau, Moldova. The application form signed by these lawyers was supported by a letter of authority of 29 September 2007, signed by Mr G.P., in his capacity of a director of the applicant company, and bearing the company seal. On 15 July 2011 the Kyiv Commercial Court declared the applicant company bankrupt. It appointed Mr O., a private individual, as liquidator of the company.
The Ukrainian Government (“the Government”) were represented by their Acting Agent, most recently, Mr I. Lishchyna of the Ministry of Justice of Ukraine.
A. The circumstances of the case
The facts of the case, as submitted by the parties, may be summarised as follows.
On 1 February 2002, in a judgment upheld on appeal on 11 April and in cassation proceedings on 20 June 2002, the Kyiv Commercial Court ordered the State Enterprise National Atomic Energy Generating Company (“Energoatom”) to pay the applicant company 56,828,970.94 Ukrainian hryvnias (UAH) in compensation.
On 11 July 2002 the Kyiv Commercial Court issued an order to enforce the above-mentioned judgment.
On 2 December 2003 the Kyiv Commercial Court instituted bankruptcy and financial rehabilitation proceedings in respect of Energoatom. The court also considered that there should be a moratorium with regard to any enforcement action against Energoatom. Enforcement proceedings were suspended and reopened several times from that point up until August 2009. In the course of those proceedings, Energoatom paid the applicant company UAH 5,000,000 in payment arears. The applicant company, represented by its directors Mr S. and Mr M., lodged a number of claims regarding the failure of bailiffs to act in the course of the above-mentioned enforcement proceedings.
On 6 August 2009 the Kyiv Commercial Court quashed the judgment of 1 February 2002 and ruled that the applicant company had to return UAH 4,933,500 to Energoatom. That judgment was confirmed by the Supreme Court on appeal, on appeal in cassation proceedings, and on appeal in further cassation proceedings on 21 April, 7 July and 3 September 2009 respectively.
As the applicant company did not pay the sum as ordered, Energoatom initiated bankruptcy proceedings against it.
On 15 July 2011 the Kyiv Commercial Court declared the applicant company bankrupt, suspending all its activities, having initiated its liquidation. It also appointed Mr O., a private individual, as liquidator of the company. That ruling was confirmed by the Kyiv Commercial Court of Appeal and the Higher Commercial Court on 12 October and 22 December 2011 respectively.
On 3 April 2012, on behalf of the applicant company in liquidation, Mr O. asked the Court to strike the application out of its list of cases. He referred to the provisions of the Bankruptcy Act.
On 7 March 2013 the applicant company’s representative appointed in 2007, Mr V. Nagacevschi, asked the Court to continue the examination of the case. He referred to his request of 3 July 2012, sent to the applicant company’s liquidator, in which he asked the liquidator not to ask for the proceedings before the Court to be discontinued.
B. Relevant domestic law (in force at the material time)
1. Commercial Corporations Act
In accordance with section 62 of the Act, a director of a limited liability company deals with all issues relating to the daily operation of that company. The director of a limited liability company shall act in compliance with the applicable domestic laws and the articles of association of that company.
2. Bankruptcy Act
Section 25(1) of the Bankruptcy Act provided, inter alia, that the liquidator of a company took over the management of all of the company’s property and ensured that property’s safety. In accordance with section 25(2) of the Bankruptcy Act, the liquidator acted as a director of the company and dealt with its day-to-day management until complete liquidation had taken place.
COMPLAINTS
The applicant company complained under Article 6 § 1 of the Convention and Article 1 of Protocol No. 1 to the Convention that the judgment of 1 February 2002 given by the Kyiv Commercial Court remained unenforced.
THE LAW
The Government stated that the applicant company’s complaints should be declared inadmissible, as there was no longer any judgment to enforce, the judgment of 1 February 2002 having been quashed on 6 August 2009. Additionally, they stated that the applicant company’s liquidator had proposed that the consideration of the present application be terminated, and thus that the application be struck out of the Court’s list of cases under Article 37 of the Convention. The applicant company’s original representatives, Mr V. Konstantinov and Mr V. Nagacevschi, disagreed.
The Court notes that the application was lodged with the Court in the name of the applicant company on 3 October 2007, and was signed by the lawyers purportedly acting on its behalf, Mr V. Konstantinov and Mr V. Nagacevschi. The application form signed by these lawyers was supported by a letter of authority of 29 September 2007, signed by Mr G.P., in his capacity of a director of the applicant company, and bearing the company seal. The Court further observes that on 15 July 2011 the Kyiv Commercial Court declared the applicant company bankrupt, suspending all its activities, having initiated its liquidation. It also appointed Mr O., a private individual, as liquidator of the company. On 3 April 2012 Mr O., acting on behalf of the applicant company in liquidation, asked the Court to strike the application out of its list of cases, referring to the provisions of section 25(2) of the Bankruptcy Act.
The Court observes that the applicant company had a separate legal personality, distinct from that of its owners or directors (see Agrotexim and Others v. Greece, 24 October 1995, § 66, Series A no. 330‑A). The Court further notes that, as from the moment the company was declared bankrupt on 15 July 2011, Mr G.P. could no longer be regarded as the company’s director and its representative, as he had lost all powers to act in the name of the applicant company. The applicant company’s liquidator, as from 15 July 2011, became the only person entitled to represent the insolvent company, as provided by section 25 of the Bankruptcy Act. That liquidator requested that the application be struck out from the Court’s list of cases.
Taking the above into account, the letter of 3 April 2012 by the liquidator and the Government’s submissions in that respect, the Court considers that, in these circumstances, the applicant company may be regarded as no longer wishing to pursue its application, within the meaning of Article 37 § 1 (a) of the Convention. Furthermore, in accordance with Article 37 § 1 in fine, the Court finds no special circumstances regarding respect for human rights as defined in the Convention and its Protocols which require the continued examination of the case. In view of the above, it is appropriate to strike the case out of the list.
For these reasons, the Court, unanimously,
Decides to strike the application out of its list of cases.
Done in English and notified in writing on 15 September 2016.
Milan BlaškoAndré Potocki
Deputy RegistrarPresident
Full & Egal Universal Law Academy