ZAKOVA v. THE CZECH REPUBLIC - 2000/09 (Judgment : Pecuniary and non-pecuniary damage - award (Article 41 - Non-pecuniary damage Pecuniary damage Just satisfaction)) [2017] ECHR 322 (06 April 2017)

In the case of Žáková v. the Czech Republic,

The European Court of Human Rights (First Section), sitting as a Chamber composed of:

          Linos-Alexandre Sicilianos, President,
          Kristina Pardalos,
          Ledi Bianku,
          Aleš Pejchal,
          Robert Spano,
          Pauliine Koskelo,
          Tim Eicke, judges,
and Abel Campos, Section Registrar,

Having deliberated in private on 14 March 2017,

Delivers the following judgment, which was adopted on that date:

PROCEDURE

1. The case originated in an application (no. 2000/09) against the Czech Republic lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (“the Convention”) by a Czech national, Ms Sylvie Žáková (“the applicant”), on 7 January 2009.

2. In a judgment delivered on 3 October 2013 (“the principal judgment”), the Court held that there had been a violation of Article 1 of Protocol No. 1 to the Convention.

3. Under Article 41 of the Convention the applicant sought just satisfaction of 5,098,600 Czech korunas (CZK) (188,677 euros (EUR)) in respect of pecuniary damage and CZK 500,000 (EUR 18,502) in respect of non-pecuniary damage. She also sought CZK 309,289.50 (EUR 11,445) for costs and expenses.

4. Since the question of the application of Article 41 of the Convention was not ready for decision, the Court reserved it and invited the Government and the applicant to submit written observations on that issue within three months and, in particular, to notify the Court of any agreement they might reach (ibid., § 103, and point 3(b) of the operative provisions).

5. The parties did not reach an agreement on the question of just satisfaction.

6. The applicant and the Government each submitted observations.

THE FACTS

7. On 23 March 2014 Týden.cz, an internet news portal, published an article with the headline “A ‘European’ dispute. She escaped communism and lost her property. Czech Republic reluctant to compensate her” (“‘Evropský’ spor. Utekla před komunisty a přišla o majetek. ČR ji nechce odškodnit”). The journalist introduced the applicant’s case by saying that she had been struggling against the Czech State for more than ten years because her land had been confiscated following her escape. Up to the present day, she had repeatedly won her case before the European Court of Human Rights. However, the issue of her compensation had become more complicated. The article contained the following statement:

“An appeal to the Constitutional Court did not help either. So she applied to the European Court of Human Rights, which noted ‘The Court is struck by the fact that in 1997 the municipality of Třebíč was able to take possession of the property on the basis of a 1971 judgment that had been quashed because, in the words of the Judicial Rehabilitation Act, it was incompatible with the principles of a democratic society’.

Eventually, the Czech Republic applied for a review of the judgment, which is the equivalent of an appeal, but was unsuccessful. Since then, complicated negotiations as to how the Government would compensate Ms Žáková have been underway. ‘I approached the Government Agent with a proposal for settlement regarding the provision of just satisfaction, which among other things is for pecuniary damage because there had been an interference with her property rights,’ stated Žáková’s lawyer [V.K.], adding that she had been deprived of her property in 1997 in breach of the Additional Protocol to the Convention on Human Rights.

The State is back tracking

‘That’s why I suggested providing her with compensation in the amount of the market value of the seized property and compensation for the loss of rent since 1997’, [V.K.] said. But in fact, Sylva Žáková was willing, according to him, to accept one tenth of the market rent.

However, the State refused [this proposal], noting that the Government were prepared to accept only compensation for the plots of land in the amount of their market value in 1997. Thus, it would be essentially lower than the current value; moreover, such compensation would not include reparation for the period when Sylvia Žáková had been unable to dispose of the land. ‘I confess that the Government’s approach in this regard seems to me at least dishonest and contravenes the basic principles of justice and our law, too,’ added lawyer [V.K.]. The Agent of the State, or more precisely, the Ministry of Justice for which he works, has refused to comment as the negotiations, according to him, are confidential.”

8. The original version of the article is as follows:

“Nepomohla ani stížnost k Ústavnímu soudu. Obrátila se proto na Evropský soud pro lidská práva. ‘Soudní dvůr je udiven skutečností, že v roce 1997 byla obec Třebíč schopna zmocnit se majetku na základě rozsudku z roku 1971, který byl zrušen, protože byl podle zákona o soudní rehabilitaci neslučitelný s principy demokratické společnosti,’ konstatoval soud.

Česká republika nakonec podala k soudu žádost o přezkoumání rozsudku, což je obdoba odvolání, ale bezúspěšně. Od té doby probíhají složitá jednání o tom, jakým způsobem vláda paní Žákovou odškodní. ‘Obrátil jsem se na vládního zmocněnce s návrhem dohody ohledně poskytnutí přiměřeného zadostiučinění, které mimo jiné spočívá ve způsobení majetkové škody, neboť došlo k zásahu do jejích majetkových práv,’ konstatoval advokát Žákové [V.K.] s tím, že její majetek jí byl v roce 1997 odňat v rozporu s Dodatkovým protokolem k Úmluvě o lidských právech.

Stát se cuká

‘Proto jsem navrhl, aby jí byla poskytnuta náhrada ve výši tržní ceny odňatého majetku a náhrada za ušlý nájem za dobu od roku 1997 do současnosti,’ řekl [V.K.] Sylvia Žáková byla přitom podle jeho slov ochotná přistoupit na desetinu tržního nájemného.

To však stát odmítl s tím, že je vláda ochotná přistoupit pouze na náhradu pozemků ve výši jejich tržní ceny v roce 1997. Tedy podstatně nižší než nyní, navíc by tato náhrada neobsahovala odškodnění za dobu, kdy s nimi Sylvia Žáková nemohla disponovat. ‘Přiznávám, že postoj vlády mi v tomto ohledu připadá mírně řečeno neseriózní a je v rozporu se základními zásady spravedlnosti a také s našimi zákony,’ dodal advokát [V.K.]. Zmocněnec státu, respektive ministerstvo spravedlnosti, pro které pracuje, se k tomu odmítl vyjádřit, protože jsou podle něj tato jednání důvěrná.”

THE LAW

9. Article 41 of the Convention provides:

“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. Alleged abuse of the right of individual application

1. The Government’s submissions

10. The Government argued that the applicant’s representative had disclosed to the media the content of the applicant’s friendly-settlement proposal and its terms, the Government’s counterproposal and the final standpoint of the applicant on the matter. The Government relied on the article published in the media (see paragraphs 8-9 above) in support of their claim.

11. The Government further submitted that the applicant had intentionally breached the confidentiality of the friendly-settlement negotiations, which constituted an abuse of the right of individual application. Her application should therefore be rejected pursuant to Article 35 of the Convention.

2. The applicant’s submissions

12. The applicant submitted that no friendly-settlement negotiations under Article 39 § 2 of the Convention and Rule 62 § 2 of the Rules of Court had ever been underway, since the Court had not taken any steps to facilitate negotiations on the amount of just satisfaction to be awarded. Her lawyer’s initiative could not therefore be considered in the context of the procedure under those provisions, both of which concerned proceedings held before the Court.

13. The applicant claimed that she had not been informed about the confidentiality of her negotiations with the Government. She emphasised that confidentiality was required for the proceedings but not for the negotiations. The term “proceedings” implied that the case was heard before the Court. The case-law referred to by the Government was not applicable in the instant case, as it concerned a case in which the Registrar had sent a proposal for a friendly settlement and the parties had been informed about the confidentiality of the negotiations. In the present case, the Court had issued a judgment reserving the application of Article 41 and had delegated to the President of the Chamber the power to schedule further proceedings if required. Lastly, the applicant stated that her representative had apologised to the Government for the disclosure, which had not been intentional or malicious; hence, it did not constitute an abuse of the right of individual application.

3. The Court’s assessment

14. The Court reiterates that under Article 39 § 2 of the Convention and Rule 62 § 2 of the Rules of Court, negotiations with a view to securing a friendly settlement are confidential. Those provisions read as follows:

Article 39 of the Convention

“1. At any stage of the proceedings, the Court may place itself at the disposal of the parties concerned with a view to securing a friendly settlement of the matter on the basis of respect for human rights as defined in the Convention and the Protocols thereto.

2. Proceedings conducted under paragraph 1 shall be confidential.

...”

Rule 62 § 2 of the Rules of Court
(Friendly settlement)

“In accordance with Article 39 § 2 of the Convention, the friendly-settlement negotiations shall be confidential and without prejudice to the parties’ arguments in the contentious proceedings. No written or oral communication and no offer or concession made in the framework of the attempt to secure a friendly settlement may be referred to or relied on in the contentious proceedings.”

15. In order to determine whether the application should be struck out of the list pursuant to Article 37 § 1(c) of the Convention, the Court must consider whether “circumstances lead it to conclude” that “for any other reason ... it is no longer justified to continue the examination of [it]”. It will, however, continue the examination of the application if respect for human rights so requires. The Court enjoys a wide discretion in identifying grounds capable of being relied upon in a strike out application on this bases, but such grounds must reside in the particular circumstances of each case (see M.H. and A.S. v the United Kingdom (dec.), nos. 38267/07 and 14293/07, 16 December 2008 and Association SOS Attentats and de Boery v. France [GC], (dec), no. 76642/01, § 37, ECHR 2006-XIV).

16. In this connection, the Court notes that procedural rules are designed to ensure the proper administration of justice and compliance with the principle of legal certainty, and that litigants must be entitled to expect those rules to be applied (see, for example, Miroļubovs and Others v. Latvia, no. 798/05, § 66, 15 September 2009; Gorou v. Greece (no. 3), no. 21845/03, § 27, 22 June 2006; Miholapa v. Latvia, no. 61655/00, § 24, 31 May 2007). More precisely, the rule of confidentiality serves to protect both the parties and the Court from any attempt to exert political or any other kind of pressure (see Abbasov and Others v. Azerbaijan (dec.), no. 36609/08, § 29, 28 May 2013; Mandil v. France (dec.), no. 67037/09, 13 December 2011; Miroļubovs and Others, cited above, § 66; and, mutatis mutandis, Malige v. France, no. 26135/95, Commission decision of 5 March 1996, Decisions and Reports 84-B, p. 156), and to facilitate a friendly-settlement by ensuring that the information provided in the course of negotiations is not revealed and made public. At the same time, Rule 62 § 2 in fine also protects the Court and its own impartiality by ensuring that should the friendly-settlement negotiations fail, their content will not prejudice the outcome of the contentious proceedings.

17. The Court reiterates that the rule of confidentiality is absolute and does not allow for individual assessment of how much detail has been disclosed (see Abbasov and Others, cited above, § 28; Balenović v. Croatia (dec.), no. 28369/07, 30 September 2010; and Lesnina Veletrgovina d.o.o. v. the former Yugoslav Republic of Macedonia (dec.), no. 37619/04, 2 March 2010). An intentional breach of the rule of confidentiality, may, in certain circumstances, constitute an abuse of the right of application, resulting in declaring the application inadmissible pursuant to Article 35 § 3 of the Convention (compare Miroļubovs and Others, cited above, § 66, Mandil, cited above; Ausad Valimised Mtü v. Estonia (dec.), no. 40631/14, § 18, 27 September 2016).

18. It is not disputed between the parties that following the receipt of the judgment on the merits, the applicant’s representative approached the Government on his own initiative with a friendly-settlement proposal. Both parties also agree that he subsequently disclosed the details of it to the media, making the discussion of its terms public. In particular, the applicant’s representative disclosed in general terms the content of the compensation proposal he had submitted to the Government, who refused it and made a counterproposal. He further commented on the counterproposal and judged the Government’s approach in a negative way.

19. In the Court’s view, these circumstances justify the conclusion that the conduct of the applicant’s lawyer failed to respect the rule of confidentiality.

20. Having said that, the Court notes that if the application were at the stage of admissibility and merits, it could be rejected for abuse of the right of individual petition, in accordance with the Court’s relevant case-law (see, for example, Benjocki and Others v. Serbia (dec.), nos. 5958/07, 6561/07, 8093/07, 9162/07, 15 December 2009; Deceuninck v. France (dec.), no. 47447/08, 13 December 2011; Barreau and Others v. France (dec.), no. 24697/09, 13 December 2011; Abbasov and Others, cited above; and Gorgadze v. Georgia (dec.), no. 57990/10, 2 September 2014). In the present case, however, the principal judgment has already been handed down and served on the parties, which makes the circumstances of the case considerably different from the above-cited cases, notably Barreau and Others.

21. As it has already been noted (see paragraph 15 above) it is always left to the Court’s discretion to assess whether disclosing of particular details from the friendly-settlement negotiations to the Court or any other third person constitutes, in the particular circumstances of a case, a breach of confidentiality resulting in declaring the application inadmissible as an abuse of the right of petition (see Stoilkovska v. the former Yugoslav Republic of Macedonia, no. 29784/07, § 31, 18 July 2013; Lesnina Veletrgovina d.o.o., cited above; and Miroļubovs and Others, cited above, § 68).

22. In the particular circumstances of the present case, the Court finds that to conclude that the conduct of the applicant’s lawyer constituted an abuse of the applicant’s right of individual application would not be justified.

23. It notes in this connection that the applicant’s original claims for just satisfaction were already summarised in the principal judgment (see paragraphs 100-103 of the principal judgment) which was publicly accessible on the website of the Court. Furthermore, as from 3 October 2013 (almost five months before the article in question was published), a Czech language translation of the judgment has also been available on the relevant Government internet site (see paragraphs 7-8 above).

24. The Court also relies on the particular circumstances of the case, which raised serious issues concerning the total lack of possibility for the applicant effectively to challenge the measure interfering with her property rights (see paragraphs 85-97 of the principal judgment). The Court finds that such circumstances require it to continue the examination of the application in accordance with Article 37 § 1 in fine.

25. In the light of all these considerations, the Court considers it appropriate to continue the examination of the case and, accordingly, rejects the Government’s objection on the grounds of disclosure of the details of the friendly-settlement negotiations to the media.

B. Pecuniary damage

1. The applicant’s submissions

26. The applicant claimed CZK 5,098,600 (EUR 188,677) in respect of pecuniary damage. In support of her claim she presented a report by an expert institute as to the market value of the property in 2014. According to the report, CZK 3,134,600 (EUR 116,021) represented the market value of the property in question in 2014 and CZK 1,964,000 (EUR 72,693) the loss of profits for the period from 1997 to 2014, during which the applicant had been unable to lease her property.

27. The applicant submitted that in the meantime, the case-law of the national courts, including the Constitutional Court, had changed considerably and that claimants who had brought actions identical to hers had been successful before the national courts. In those similar cases the national courts had already begun to declare the State’s interference in the claimants’ ownership illegal and the claimants had had their ownership restored in integrum. However, since the applicant had been unable to enjoy that new approach on the part of the national courts, she highlighted the fact that the successful third parties had had their ownership restored, and were thus enjoying their ownership at the current market value. By contrast, the Government had offered her compensation at the value when the illegal interference had taken place. She urged the Court to take into account the specific circumstances of her case: in 1997, the transition of the country into a market economy was still underway, which meant that property prices had still been at a pre-market economy level. Full market values had been partly reached after the accession of the Czech Republic to the European Union. They had been reached fully after a seven-year transitional period in which foreigners had been allowed to purchase property, namely in 2011.

2. The Government’s submissions

28. The Government disputed the way in which the expert institute commissioned by the applicant had calculated the market value of the property, by comparing incomparable property, adding some coefficients without any explanation and wrongly including in the calculations a plot of land in the ownership of a third party (plot no. 2174/7 in the cadastral area of Třebíč measuring 286 square metres), as well as the date on which the market value of the property had been assessed. They referred to the case-law of the Court, according to which the market value of property should be based on its value at the time of expropriation, namely 12 November 1997.

29. The Government submitted their own expert report by EQUITA Consulting s.r.o., which had assessed the market value of the property at issue as at November 1997 at CZK 367,000 (EUR 13,360). Its assessment was based on the rent negotiated between the applicant and the municipality of Třebíč in 1996 (see paragraph 15 of the principal judgment) which would give the amount of CZK 270,000 (EUR 9,829). However, the expert company had indicated - and the Government admitted - that the latter was slightly undervaluated, and that CZK 367,000 (EUR 13,360) would be more appropriate.

30. In the Government’s view, the above-mentioned sum should be increased by inflation at an annual rate of 2.75% for the period from 1997 to 2013, and by statutory interest. Since the rate of statutory interest had not yet been fixed in domestic law, the Government took as a guideline the conclusion in the case of Scordino v. Italy (no. 1) ([GC], no. 36813/97, § 258, ECHR 2006-V). The Government suggested an equitable rate of 8% per annum, in accordance with the opinion of their expert company. Thus, the above-mentioned sum of CZK 367,000 (EUR 13,360), increased as shown, amounted to CZK 1,306,520 (EUR 47,570).

31. However, the Government pointed out that in accordance with the Court’s case-law, in cases regarding properties which had been seized by communist regimes, then acquired by third parties bona fide and eventually returned to the original owner, the bona fide purchasers had been awarded only up to 75-80% of the property’s market value. Taking into consideration the necessity of restoring the balance between public and individual interests, as well as the complexity of the restitution process and the conduct of the applicant in 1996 (she did not inform the municipality of Třebíč of her conviction in 1977, nor respond to their letter, which resulted in a chain of actions leading to her loss of the right to have her ownership restored by means of the restitution process), the Government would agree with an award of just satisfaction amounting to 75% of EUR 47,570, namely EUR 35,680.

3. The Court’s assessment

(a) Applicable principles

32. The Court reiterates that a judgment in which it finds a breach imposes on the respondent State a legal obligation to put an end to the breach and make reparation for its consequences in such a way as to restore as far as possible the situation existing before the breach (see Iatridis v. Greece (just satisfaction) [GC], no. 31107/96, § 32, ECHR 2000-XI). In cases where the interference with property rights has satisfied the condition of lawfulness and was not arbitrary, the Court has considered that compensation at the level of the market value of the property at the time of the interference was appropriate (see Scordino v. Italy (no. 1), quoted above, §§ 248 and 257-258, and Rousk v. Sweden, no. 27183/04, § 151, 25 July 2013).

33. Consequently, the reparation should aim at putting the applicant in the position in which he or she would have found himself had the violation not occurred (see Dacia S.R.L. v. Moldova (just satisfaction), no. 3052/04, § 39, 24 February 2009). This can involve compensation for both the loss actually suffered (damnum emergens) and the loss, or diminished gain, to be expected in the future (lucrum cessans).

34. The Court’s case-law establishes that there must be a clear causal connection between the damage claimed by the applicant and the violation of the Convention. Where appropriate, this may include compensation for loss of earnings (see, for example, Barberà, Messegué and Jabardo v. Spain (Article 50), 13 June 1994, §§ 16-20, Series A no. 285-C; Çakıcı v. Turkey [GC], no. 23657/94, § 127, ECHR 1999-IV; and Kurić and Others v. Slovenia (just satisfaction) [GC], no. 26828/06, § 81, ECHR 2014).

(b) Value of the plots of land

35. The Court is aware of the difficulties in calculating the value of property and notes the considerable disparity between the parties’ estimates. This is mainly due to the different methods of calculation adopted by the parties’ experts.

36. First the Court has to determine the date at which the plots of land should be valued. It must decide whether this should be, as the applicant suggested, the date on which the expert’s report was drawn up or, as the Government proposed, referring to numerous examples of the Court’s case-law, on 12 November 1997, namely at the time when the interference with the applicant’s property rights had taken place. The Court will then proceed to assess the market value of the plots of land at issue.

37. In this connection, it is to be emphasised that this is not a case of nationalisation or otherwise lawful deprivation of property where the only issue before the Court is whether the applicant received appropriate compensation. Rather, as was found in the principal judgment, the case refers to deprivation of possession which lacked a valid reason and was in breach of the principle of legal certainty. On the other hand, the Court held that the interference with the applicant’s possession was lawful and had a legal aim (see paragraphs 83-84 of the principal judgment).

38. The Court, recalling the principles set out above (see paragraphs 32-34), sees no reason to make a different assessment in the present case. Hence, it considers it appropriate to base its assessment on the value of the property at the time of the interference, as suggested by the Government, namely on 12 November 1997.

39. The Court accepts, since it is clear from the cadastral documents submitted by the parties (see paragraphs 5-7 of the principal judgment), the Government’s objection concerning plot no. 2174/7 in Třebíč (286 square metres). Since that plot is owned by a third person and was not an object of the applicant’s complaint before the Court, it should be excluded from the calculations for just satisfaction.

40. The Court further notes that according to the expert institute report submitted by the applicant, in 1997 the plots of land were worth CZK 869,610 (EUR 32,180) (the Court’s calculations being based on a deduction of the third person’s plot of land). It also notes that the Government contested that figure and submitted their own expert institute report, which stated that the plots were worth CZK 367,000 (EUR 13,360) in total.

41. The Court accepts the expert institute report submitted by the Government as the most relevant piece of evidence. Its calculations seem to be more accurate and realistic, and it has taken due account of the fact that the plots of land are of very limited use because they have been built upon, which limits their value. However, the Court notes that the market value as of 1997 does not correspond with today’s prices. The average annual inflation rate in the Czech Republic in the past twenty years has been 2.75% (according to the website of the Czech Statistical Office, the ČSÚ), which must be taken into account. As far as the statutory interest is concerned, the Court notes that the applicant did not request it in her submissions. Thus, the Court sees no reason to include it in its calculations.

42. Hence, the Court awards the applicant under this head EUR 21,388 (taking into account the inflation as indicated above).

43. The Court considers that the applicant lost the profits she could have made had her rights not been violated and her possession of the plots of land at issue continued between 1997 and 2014. Furthermore, the Court is mindful of the substantial difference in the calculation of lost profits submitted by the applicant and by the Government, both of which were based on the reports of their respective expert institutes.

44. The Court accepts the Government’s argument that the plots of land had been built upon, which had significantly affected their usefulness, as the land could only be leased to the owners of the buildings. It also notes that in 1996 the applicant had rented the plots of land at issue for CZK 12,576 (EUR 465) per annum. However, the Government’s expert institute found that amount low and calculated that the applicant had lost CZK 29,392 (EUR 1,088) a year in net profits (corresponding to the amount not received from the lease). It considered that the percentage of annual rent should be associated with the value of the land. In the case at hand, it would have been 5% of the land value. In the light of that sum and the Government’s expert institute report, the amount claimed by the applicant (based on her own expert institute report) of CZK 140,000 (EUR 5,180) seems to the Court to be excessive, since in 1996 the applicant had rented the plots of land in question to the municipality of Třebíč for merely 9% of the rental value estimated in the expert institute’s report submitted by her for the ensuing year. This renders the applicant’s estimates concerning the lost profits implausible. However, the Government failed to submit their own calculation of the annual rental value of the plots of land, since their expert report contained calculations only for 1997. The Government limited themselves to stating that the applicant’s lost profits for the period from 1997 to 2014 constituted 9% of the amount submitted by her, namely CZK 176,760 (EUR 6,542).

45. The Court therefore cannot take into account the amount presented by the Government, which is limited to the year 1997. Moreover, it is not the role of the Court to recalculate all the sums submitted in order to ascertain the necessary data. Nor can the Court consider the estimate of the annual rent submitted by the applicant, since it is in stark contrast to the rent which the applicant herself had agreed with the municipality of Třebíč in 1996.

46. In the circumstances of the case, making its assessment on an equitable basis (taking into account the fact that rental incomes are now lower than they were in 1997) the Court awards the applicant the sum of CZK 30,000 (EUR 1,092) in respect of annual loss of profits, which for twenty years amounts to CZK 600,000 (EUR 21,842).

C. Non-pecuniary damage

47. The applicant claimed CZK 500,000 (EUR 18,502) in respect of non-pecuniary damage, in view of the length of the judicial proceedings before the national courts and the standpoint taken by the State, which had accused her of malpractice and intentionally distorted certain facts in order to justify its position.

48. The Government deemed the claim to be excessive and wholly disproportionate. In their view, the finding of a violation in itself would constitute sufficient just satisfaction.

49. The Court considers that the applicant must have suffered non-negligible non-pecuniary damage, since the interference with her possession was significant (see paragraph 85 of the principal judgment). In particular, she must have suffered feelings of anxiety, distress and futility as a result of the facts that the Court has already described in detail in the principal judgment (see paragraphs 94 and 95). Making its assessment on an equitable basis, it awards her EUR 7,500 in respect of non-pecuniary damage, plus any tax that may be chargeable on that amount.

D. Costs and expenses

50. The applicant claimed a total of CZK 309,289.50 (EUR 11,445) for costs and expenses. She submitted a detailed account breaking the amount down as follows:

(a) CZK 237,765 (EUR 8,799) for legal representation by her lawyer, both before the national courts and before the Court;

(b) CZK 11,000 (EUR 407) for court fees;

51. The Government contested those figures. They urged the Court to take into account the fact that the application had been declared partly both inadmissible (cf. paragraphs 59-60 of the principal judgment) and manifestly ill-founded (cf. paragraphs 98-99 of the principal judgment). Furthermore, the costs of the applicant’s first expert report should not be included as it was fairly inapplicable to the case (it was out of the relevant time scope); so CZK 12,240 should be deducted from the claim. Lastly, the sum for costs and expenses before the national courts was excessive. In the Government’s view, CZK 99,000 (EUR 3,664) should be awarded to the applicant under this head.

52. According to the Court’s case-law, an applicant is entitled to the reimbursement of costs and expenses only in so far as it has been shown that these were actually and necessarily incurred and were reasonable as to quantum. That is, the applicant must have paid them, or be bound to pay them, pursuant to a legal or contractual obligation, and they must have been unavoidable in order to prevent the violation found or to obtain redress. The Court requires itemised bills and invoices that are sufficiently detailed to enable it to determine to what extent the above requirements have been met (see İzzettin Doğan and Others v. Turkey [GC], no. 62649/10, § 192, ECHR 2016).

53. In the present case, regard being had to documents in its possession and the above criteria and given that the applicant has only been partially successful in the matter (cf. paragraphs 59-60 and paragraphs 98-99 of the principal judgment), the Court deems it reasonable to award her CZK 200,000 (EUR 7,402) under this head.

E. Default interest

54. The Court considers it appropriate that the default interest rate should be based on the marginal lending rate of the European Central Bank, to which should be added three percentage points.

FOR THESE REASONS, THE COURT, UNANIMOUSLY,

1. Dismisses the Government’s preliminary objection;

2. Holds

(a) that the respondent State is to pay the applicant, within three months from the date on which the judgment becomes final in accordance with Article 44 § 2 of the Convention, the following amounts, to be converted into the currency of the respondent State at the rate applicable at the date of settlement:

(i) EUR 43,230 (forty-three thousand two hundred and thirty euros) in respect of pecuniary damage;

(ii) EUR 7,500 (seven thousand five hundred euros), plus any tax that may be chargeable, in respect of non-pecuniary damage;

(iii) EUR 7,402 (seven thousand four hundred and two euros), plus any tax that may be chargeable to the applicant, 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;

3. Dismisses the remainder of the applicant’s claim for just satisfaction.

Done in English, and notified in writing on 6 April 2017, pursuant to Rule 77 §§ 2 and 3 of the Rules of Court.

Abel Campos Linos-Alexandre Sicilianos
Registrar President

In accordance with Article 45 § 2 of the Convention and Rule 74 § 2 of the Rules of Court, the following separate opinions are annexed to this judgment:

(a) Concurring opinion of Judge Spano;

(b) Concurring opinion of Judge Koskelo;

L.A.S.
A.C.

CONCURRING OPINION OF JUDGE SPANO

I fully agree with the Court’s resolution of this case. I only write separately to observe that for the reasons expressed in my concurring opinions in the cases of Čapský and Jeschková v. the Czech Republic, (nos. 25784/09 and 36002/09, 9 February 2017 (not final)), and Heldenburg v. the Czech Republic, (no. 65546/09, 9 February 2017 (not final)), the Court should have examined the Government’s preliminary objection, as to the alleged abuse by the applicant of the right of individual application, solely on the basis of Article 35 § 3 (a) of the Convention.

CONCURRING OPINION OF JUDGE KOSKELO

I agree with the majority as regards the outcome of this case. As regards the reasoning given for the dismissal of the Government’s preliminary objection, however, I do not fully share the opinion of the majority.

Firstly, as explained in my separate opinion in the recent cases of Čapský and Jeschkeová v. the Czech Republic, nos. 25784/09 and 36002/09 and Heldenburg v. the Czech Republic, 65546/09, I consider that it would be more appropriate to have recourse to Article 37 § 1 (c) as the legal basis for addressing situations where there has been a breach of Rule 62 § 2 of the Rules of Court.

Similarly to the judgments in those cases, the majority in paragraph 15 of the present judgment do first refer to Article 37 § 1 (c), suggesting that this is the legal basis for considering the Government’s preliminary objection in the light of the applicant’s conduct. Subsequently, however, the reasoning turns toward addressing the situation from the point of view of whether or not the applicant’s conduct amounts to an abuse of the right of application. In paragraph 22 the majority make the determination that this was not the case. Again, the approach taken appears unclear and rather confusing in regard to the question of what legal basis should guide the Court when faced with a breach of Rule 62 § 2.

Secondly, as regards the substantive reasons for dismissing the Government’s preliminary objection, I am uneasy with the considerations expressed by the majority in paragraph 24 of the judgment. It must remain clear that the express Rules of Court are to be observed in all cases, even those where the circumstances underlying the complaint reveal a serious problem at the domestic level. In this regard, I find the considerations expressed in the first sentence of paragraph 24 - although correct as such - too wide and general and therefore not sufficient in themselves. For me the important additional consideration is that in this particular case, I find that it would be excessively harsh on the applicant if her compensation claims were to be struck out on account of a breach that clearly appears to have resulted from a failure on the part of her lawyer to abide by the relevant Rules rather than from any instruction stemming from the applicant herself to disregard those Rules. Although it is an important and established principle that any mistakes or omissions made by the lawyer engaged by the applicants are imputable to the applicants themselves, who must bear the negative consequences of what their lawyer does or fails to do in handling the case, in the present situation it would be a disproportionate consequence if the applicant were precluded from having her compensation claims examined, taking into account that the Court has already found a violation of her Convention rights and that efforts to reach a friendly settlement have failed. In the belief that the applicant herself has acted in good faith and cannot be faulted for the breach that has occurred, I conclude that in the circumstances of the present case it is justified to continue examining her remaining claims.

CONCURRING OPINION OF JUDGE EICKE

1. I also agree with the majority on the outcome of this case. However, like Judge Koskelo, I also consider that the reasoning in paragraphs 21 to 24 of the judgment is capable of creating unnecessary ambiguity about the basis on which the Government’s preliminary objection concerning the alleged “abuse of the right of individual application” falls to be considered in this case.

2. In my Partly Concurring and Partly Dissenting Opinions in Čapský and Jeschkeová v. the Czech Republic, nos. 25784/09 and 36002/09, 9 February 2017, and Heldenburg v. the Czech Republic, no. 65546/09, 9 February 2017, I sought to explain why, in my view, in cases where, following a substantive judgment, the Court is only concerned with just satisfaction under Article 41 of the Convention, Article 37 § 1 (c) provides the only legal basis on which the Court can impose a sanction in cases in which there has been a serious breach of the Rules of Court. I do not intend to repeat paragraphs 1-9 of those separate Opinions.

3. The particular Rule of Court in issue in this case, as in those two cases, is Rule 62 § 2. It is important to underline the importance and absolute nature of this Rule and the requirement of confidentiality in the context of friendly settlement negotiations it imposes alluded to in paragraph 17 of the judgment. Any party breaching this Rule should expect the Court to take a strict approach to its enforcement and should be aware of the consequences this is likely to have for the (continued examination) of the application.

4. Applying Article 37 § 1 (c) to the breach of Rule 62 § 2 in the present case, I agree that, as the judgment records at paragraph 19, the circumstances of this case “justify the conclusion that the conduct of the applicant’s lawyer failed to respect the rule of confidentiality” and, therefore, amounted to a clear breach of Rule 62 § 2. It is important in this context that, as the judgment records at paragraph 18, it was common ground that the applicant’s lawyer arose out of “his own initiative”.

5. The only remaining question, therefore, is whether this Court, in the exercise of its discretion should conclude that, despite this clear breach of the Rules of Court, it remains “justified to continue the examination of the application” as provided for in Article 37 § 1 (c).

6. As I indicated in paragraph 10 of my separate Opinions in Čapský and Heldenburg, I accept that, in absence of specific guidance on the application of Article 37 § 1 (c) in cases such as the present, the existing case law on the concept of “abuse of the right of application” under Article 35 § 3 (a) may be capable of being applied mutatis mutandis and/or of providing guidance on the correct approach to the imposition of an appropriate sanction for a clear breach of the Rules of Court under Article 37 § 1 (c). However, in so far as paragraphs 21 and 22 of the judgment may be read as applying that case law directly (through the prism of Article 35 § 3 (a)), I respectfully disagree. The test to be applied is that identified in paragraph 5 above and not, as it appears to be suggested in paragraph 22 of the judgment, whether “the conduct of the applicant’s lawyer constituted an abuse of the applicant’s right of individual petition”.

7. In the relation to the exercise of the discretion left to the Court under Article 37 § 1 (c) I share the unease, expressed with the final paragraph of Judge Koskelo’s Concurring Opinion in the present case, with the reason given by the majority in paragraph 24 of the judgment and agree with the additional consideration she identifies for exercising the Court’s discretion, in the context of the specific circumstances of this case, in favour of the applicant.

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You are here: BAILII >> Databases >> European Court of Human Rights >> ZAKOVA v. THE CZECH REPUBLIC - 2000/09 (Judgment : Pecuniary and non-pecuniary damage - award (Article 41 - Non-pecuniary damage Pecuniary damage Just satisfaction)) [2017] ECHR 322 (06 April 2017) URL: http://www.bailii.org/eu/cases/ECHR/2017/322.html Cite as: ECLI:CE:ECHR:2017:0406JUD000200009, [2017] ECHR 322, CE:ECHR:2017:0406JUD000200009