THE FACTS
I. THE CIRCUMSTANCES OF THE CASE
A. Legal status of the Yakutskgorteploset municipal company
B. Judgments in the applicant's favour and the company's liquidation
1. First judgment in the applicant's favour
2. Liquidation order in respect of the company
3. Second judgment in the applicant's favour
4. Enforcement proceedings in respect of two judgments
5. Further developments in the insolvency proceedings
C. The applicant's action against the liquidation commission
D. Proceedings before the Constitutional Court
E. Current enforcement status of the judgments in the applicant's favour
II. RELEVANT DOMESTIC LAW AND PRACTICE
A. Municipal unitary enterprises
B. Insolvency of unitary enterprises with the right of economic control
C. Specific provisions concerning transfer of communal infrastructure facilities of vital importance
1. Federal Insolvency Act
2. Ruling no. 8-П of 16 May 2000 by the Constitutional Court
“4. [...] Communal infrastructure having vital importance for a region constituting a debtor's estate is being used not only in the owner's private interests but also in the public interests protected by the State. Therefore, the relations concerning its functioning and use for a designated purpose are public in nature. In regulating this area, the legislator may decide, with regard to public purposes, that certain objects necessary for the survival of the population may be transferred to the relevant municipal authority in the course of the insolvency proceedings. [This ... serves the purpose of] redistribution of social functions between public authorities at different levels”.
The Constitutional Court decided that the provisions allowing the transfer of various objects of special importance to society, including communal infrastructure objects, to local authorities were put in place in order to ensure that their designated use complied with the Constitution of the Russian Federation. However, the practical interpretation of these provisions by the domestic courts might have contradicted their constitutional meaning. The Constitutional Court found that these provisions could not be interpreted as allowing for the transfer of such facilities to local authorities without payment to creditors during insolvency proceedings, of reasonable and fair compensation which is able to secure a fair balance between the demands of the general interest of the community and the requirements of the protection of the individual's fundamental rights. The court further held the said provision to be unconstitutional in so far as it allowed the property transfer without effective judicial control.
THE LAW
I. ALLEGED VIOLATION OF ARTICLE 6 OF THE CONVENTION AND ARTICLE 1 OF PROTOCOL No. 1
Article 6
“In the determination of his civil rights and obligations ..., everyone is entitled to a fair ... hearing ... by [a] ... tribunal...”
Article 1 of Protocol No. 1
“Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law.
The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties.”
A. Admissibility
1. Alleged abuse of the right of petition
2. Compatibility ratione personae (responsibility of the State)
a. The parties' submissions
b. The Court's assessment
3. Non-exhaustion
The Court finally notes that, insofar as the judgments given in the applicant's favour were apparently not enforced owing to the alleged lack of funds on the part of the debtor company, this deficit was caused, to a large extent, by the transfer of the main funds to a newly created municipal enterprise by the decision of the Town Council, which the applicant was not even able to contest before the courts. In such circumstances, the Court finds that the applicant was absolved from lodging complaints against the bailiffs' conduct since the reasons for the non-enforcement of the judgment were beyond the bailiffs' influence (see, mutatis mutandis, Mykhaylenky and Others, cited above, § 39). The Court accordingly dismisses the Government's objection.
4. Conclusion
B. Merits
II. OTHER ALLEGED VIOLATIONS OF THE CONVENTION
III. APPLICATION OF ARTICLE 41 OF THE CONVENTION
“If the Court finds that there has been a violation of the Convention or the Protocols thereto, and if the internal law of the High Contracting Party concerned allows only partial reparation to be made, the Court shall, if necessary, afford just satisfaction to the injured party.”
A. Damage
B. Costs and expenses
C. Default interest
FOR THESE REASONS, THE COURT UNANIMOUSLY
(a) that the respondent State is to pay the applicant, within three months of the date on which the judgment becomes final in accordance with Article 44 § 2 of the Convention, the following amounts, plus any tax that may be chargeable, to be converted into Russian roubles at the rate applicable on the date of the settlement:
(i) EUR 1,837 (one thousand eight hundred and thirty-seven euros) in respect of pecuniary damage;
(ii) EUR 3,000 (three thousand euros) in respect of non-pecuniary damage;
(iii) EUR 16 (sixteen euros) in respect of costs and expenses;
(b) that from the expiry of the above-mentioned three months until settlement simple interest shall be payable on the above amounts at a rate equal to the marginal lending rate of the European Central Bank during the default period plus three percentage points;
Done in English, and notified in writing on 8 April 2010, pursuant to Rule 77 §§ 2 and 3 of the Rules of Court.
Søren Nielsen Christos Rozakis
Registrar President