AS TO THE ADMISSIBILITY OF
Application no. 14379/03
by Brunhilde SCHAEFER
The European Court of Human Rights (Fifth Section),
4 September 2007 as a Chamber composed of:
Mr P. Lorenzen, President,
Mrs S. Botoucharova,
Mr K. Jungwiert,
Mr R. Maruste,
Mr J. Borrego Borrego,
Mrs R. Jaeger,
Mr M. Villiger, judges,
and Mrs C. Westerdiek, Section Registrar,
Having regard to the above application lodged on 28 April 2003,
Having deliberated, decides as follows:
The applicant, Mrs Brunhilde Schaefer, is a German national who was born in 1934 and lives in Mannheim. She was represented before the Court by Mr H. Hohmann and Mr T. Makatsch, lawyers practising in Büdingen.
A. The circumstances of the case
The facts of the case, as submitted by the applicant, may be summarised as follows.
1. Background to the case
The applicant and M.S. are a married couple. Their property is subject to the statutory matrimonial property regime of the community of increased assets (Zugewinngemeinschaft; see Relevant domestic law below).
M.S. was the manager of two limited liability companies in which he had invested 61,000 marks (DEM). The companies had taken out several loans for which M.S., as well as his son and wife, had provided security.
On 26 September 1988 and on 1 August 1989 M.S. pledged four bonds (of a total value of DEM 232,000) to the Schwetzingen Regional Savings Bank as security for all present and future claims of the bank against him. Thereupon, the bank furnished a guarantee of DEM 300,000 for a loan which M.S. had received from a different bank and granted him two loans.
On 20 January 1990 the Schwetzingen Regional Savings Bank gave M.S. notice of termination of the loans and claimed their repayment. However, M.S. was unable to settle his debts.
In 1991 the claims arising from the four bonds pledged by M.S. became due. The Schwetzingen Regional Savings Bank arranged for the sum of money which had fallen due to be paid into M.S.’s account with the bank, where it was charged with M.S.’s debts.
The applicant and M.S. have made their living since then from a small pension, financial aid granted by others and two low-paid part-time jobs.
2. The proceedings before the civil courts
On 4 March 1991 the applicant, who was from then
on represented by counsel throughout the proceedings, brought an action
against the Schwetzingen Regional Savings Bank for restitution of the
four bonds or alternatively for payment of DEM 232,000. She claimed that
the pledging of the bonds by her husband was void pursuant to section 1365
of the Civil Code (see Relevant domestic law below). She argued that
the companies managed by her husband had already been heavily indebted
Her husband’s interests in his two companies therefore no longer had any value. The defendant bank had been aware that the bonds constituted her husband’s last property and she had not consented to his pledging the bonds as prescribed by section 1365 of the Civil Code in such circumstances.
As her husband did not want to claim restitution of the bonds himself, she had a right to restitution under section 1368 of the Civil Code (see Relevant domestic law below).
The Schwetzingen Regional Savings Bank pleaded that, already in 1991, it had set off (see Relevant domestic law below) its claim for repayment of M.S.’s loan against the claim for restitution of the bonds.
On 5 January 1994 the Schwetzingen District Court (Family Division) dismissed the applicant’s action.
On 30 December 1997 the Karlsruhe Court of Appeal dismissed the applicant’s appeal.
Contrary to a previous undertaking allegedly given orally by the judge rapporteur in the hearing, the Court of Appeal subsequently dismissed the applicant’s request for legal aid for the proceedings.
On 1 February 2000 the applicant received a copy of the defendant’s observations.
On 2 February 2000 the Federal Court of Justice, having held a hearing on that day, rejected the applicant’s request under section 283 of the Code of Civil Procedure (see Relevant domestic law below) to grant her an additional opportunity to reply in writing to the defendant’s observations (running to twelve pages) of 27 January 2000, which the applicant had received the day before the hearing, and dismissed the applicant’s appeal on points of law.
The Federal Court of Justice noted that section 1365 of the Civil Code protected a spouse’s interest in preserving the family’s assets. However, this interest did not outweigh the interests of the other spouse’s creditors under all circumstances. In particular, the Debtors (Voidable Dispositions) Act (see Relevant domestic law below) offered protection for the creditors of a spouse who had transferred his/her assets to the other spouse in order to exempt these assets from his/her creditors’ attachment. This did not mean, however, that section 1365 of the Civil Code did not fully apply to heavily indebted spouses.
The Federal Court of Justice found that the applicant could not claim under section 1368 of the Civil Code the amount of money the defendant had received when the claims arising from the four bonds had become due. It left open whether the bonds had constituted M.S.’s entire or almost entire property and whether the defendant had known this as required by section 1365. This being assumed, the pledge of the bonds had been void and M.S. had initially had a claim against the defendant for payment of the amount of money the bank had obtained when the bonds were redeemed. However, the defendant bank had validly set off its own claim against M.S. for repayment of the loans against M.S.’s said claim by having the money obtained from the bonds paid into M.S.’s account with the bank and by charging it with M.S.’s debts.
The Federal Court of Justice, agreeing with the defendant, which had argued in its observations that it had set off its claim for repayment of the loans against the claim under section 1365 of the Civil Code, considered the set-off to be valid. Section 1368 of the Civil Code only allowed the applicant to enforce M.S.’s claim in her own name. Likewise, the protective purpose of sections 1365 and 1368 of the Civil Code had not been impaired by the set-off. The said provisions did not shield a spouse from all reductions of the family’s assets caused by the other spouse, in particular, by incurring liabilities which endangered the preservation of those assets. Creditors who had a claim for payment as a result of these liabilities could enforce their claim against the indebted spouse by execution against the debtor’s property. Just as section 1365 of the Civil Code did not give the other spouse a right to prevent compulsory execution, it did not protect that spouse from a set-off if the creditor had a claim against the spouse who had disposed of his/her property contrary to section 1365. Instead of attaching the disposing spouse’s claim for payment against the bank, the latter could set off its own claim for repayment of the loan against M.S.’s claim.
The decision was served on the applicant on 6 April 2000.
3. The proceedings before the Federal Constitutional Court
On 4 May 2000 the applicant lodged a complaint
with the Federal Constitutional Court. She argued that the German courts
had interpreted sections 1365 and 1368 of the Civil Code in a manner
which disregarded her right to respect for her family life as protected
by the Basic Law.
The Federal Court of Justice had also refused to allow her an opportunity to reply in writing to the defendant’s observations, which she had received only one day before the hearing. Furthermore, her trial had been unfair, in particular, in that the undertaking of the judge rapporteur of the Court of Appeal that she would be granted legal aid had not been fulfilled.
On 23 October 2002 the Federal Constitutional Court declined to consider the applicant’s constitutional complaint (file no. 1 BvR 801/00).
The decision was served on the applicant on 29 October 2002.
B. Relevant domestic law
1. Rules on matrimonial property
Sections 1363 to 1390 of the Civil Code lay down rules concerning the matrimonial property of married couples.
The property of spouses is subject to the statutory matrimonial property regime of the community of increased assets (Zugewinngemeinschaft) if they have not stipulated in a marriage contract that different rules shall apply (section 1363 § 1 of the Civil Code). The property of the husband and wife does not become joint property. However, any increase in the assets of either spouse during the marriage is equalized on termination of the community of increased assets (for example, by death or divorce, see section 1363 § 2 of the Civil Code).
There are certain limitations on a spouse’s right to dispose of his or her assets. In particular, according to section 1365 § 1 of the Civil Code, a spouse may only (agree to) dispose of the entirety of his or her assets with the other spouse’s prior or subsequent consent. The approval of guardianship courts may be substituted for the other spouse’s consent to the transaction under certain conditions: if the transaction is in line with a proper administration of the assets and if the other spouse has refused his or her consent without good cause (section 1365 § 2 of the Civil Code).
Section 1368 of the Civil Code provides that if a spouse has disposed of his or her assets without the other spouse’s necessary consent, the other spouse is also entitled to enforce in court the claims emanating from the invalidity of the transaction.
2. Rules on the contestation of a debtor’s transactions by his creditors
The Debtors (Voidable Dispositions) Act (Anfechtungsgesetz) of 5 October 1994 lays down rules for the contestation by creditors of a debtor’s transactions which have put the creditors at a disadvantage.
Section 3 § 1 of that Act provides that a creditor may contest a transaction which has been entered into by the debtor, with the intention of putting his creditors at a disadvantage, within the preceding ten years if the other party to the transaction was aware of the debtor’s intent at the time of the transaction. According to section 3 § 2, the creditors may, under certain circumstances, also contest a contract involving remuneration between the debtor and a person having a close relationship with him or her, if the creditors are directly put at a disadvantage by the contract.
3. Rules on the setting-off of claims
If two persons have obligations of a similar
nature against each other
(in particular, the obligation to pay off a debt), each party may declare the set-off of his/her own claim against the claim of the other party under certain circumstances, in particular under the condition that the claim of the party effecting the set-off is already due (section 387 of the Civil Code).
The set-off is effected by way of a declaration to the other party (section 388 of the Civil Code) and results in both claims becoming extinct (with retroactive effect) as from the time when both claims had first become subject to setting-off (section 389 of the Civil Code).
4. Rules on additional written pleadings after the hearing
Section 283 of the Code of Civil Procedure (which is applicable to proceedings before the Federal Court of Justice pursuant to section 555 of the Code of Civil Procedure) lays down rules on additional written pleadings after the hearing. If one party to the proceedings is unable to reply to the submissions of the other in the course of the hearing because that party had not been informed in due time of those submissions before the hearing , the court may, on the party’s request, grant that party leave to give explanations in writing after the hearing within a period fixed by the court.
The applicant complained under Article 8 of the Convention that her right to respect for her family life had been violated by the German courts’ interpretation of sections 1365 and 1368 of the Civil Code.
Moreover, the applicant claimed that her right to a hearing under Article 6 § 1 of the Convention had been disregarded in that she had not been given an opportunity to reply in writing to the defendant’s belated written observations before the Federal Court of Justice. By proceeding in this manner, that court had also discriminated against her in relation to the defendant contrary to Article 6, read in conjunction with Article 14 of the Convention.
Relying on Article 6 of the Convention, the applicant further submitted that she had not had a fair trial before the Karlsruhe Court of Appeal, as that court had refused to grant her legal aid for the proceedings before it.
1. The applicant claimed that the domestic courts’ interpretation of sections 1365 and 1368 of the Civil Code had breached her right to respect for her family life as guaranteed by Article 8 of the Convention which, in so far as relevant, reads:
“1. Everyone has the right to respect for his ... family life ...
2. There shall be no interference by a public authority with the exercise of this right except such as is in accordance with the law and is necessary in a democratic society in the interests of national security, public safety or the economic well-being of the country, for the prevention of disorder or crime, for the protection of health or morals, or for the protection of the rights and freedoms of others.”
The applicant argued that respect for family
life as guaranteed by Article 8 also comprised the economic and social
protection of the family. Sections 1365 and 1368 of the Civil Code were
primarily aimed at safeguarding the economic basis of the marriage and
The judgments of the domestic courts had deprived the applicant’s family of their basis of subsistence and had therefore interfered with her family life. Even if the protection of the creditors’ rights had been the aim of the interference, it had not been proportionate.
The Court reiterates that family life does not consist only of social, moral or cultural relations, for example in the sphere of children’s education; it also comprises interests of a pecuniary nature. This is shown by, among other things, the obligations in respect of maintenance and the position occupied in the domestic legal systems of the majority of the Contracting States by the institution of the reserved portion of an estate. The Court has thus considered, for example, that matters of intestate succession – and voluntary dispositions – between near relatives prove to be intimately connected with family life (see, in particular, Marckx v. Belgium, judgment of 13 June 1979, Series A no. 31, pp. 23-24, § 52, and Pla and Puncernau v. Andorra, no. 69498/01, § 26, ECHR 2004-VIII).
The Court will therefore proceed on the assumption that the subject matter of the case, that is, the domestic courts’ interpretation of sections 1365 and 1368 of the Civil Code to the effect that the applicant could not claim restitution of the value of the bonds disposed of by her husband, is covered by the notion of “family life” under Article 8.
The Court further observes that the instant case concerns a dispute between two private individuals (the applicant and the defendant bank) about their rights in respect of certain bonds. The case could be analysed in terms of interference by the German courts with the applicant’s right to respect for her family life if the domestic courts’ interpretation of the applicable provisions of domestic law were to be considered as disregarding Article 8 or as the courts’ failure, in the relationship between private parties, to comply with its positive obligation flowing from Article 8 to take reasonable and appropriate measures effectively to protect the applicant’s family life when applying domestic law.
The Court may, however, leave that question open. Whether the case is analysed in terms of a positive duty on the part of the State to take reasonable and appropriate measures to secure the applicant’s rights under paragraph 1 of Article 8 or in terms of an interference by a public authority to be justified in accordance with paragraph 2, the applicable principles are broadly similar. In both contexts a fair balance has to be struck between the competing interests of the individual and of the community as a whole; and in both contexts the State enjoys a certain margin of appreciation in determining the steps to be taken to ensure compliance with the Convention. Furthermore, even in relation to the positive obligations flowing from the first paragraph of Article 8, in striking the required balance the aims mentioned in the second paragraph may be of a certain relevance (see Powell and Rayner v. the United Kingdom, judgment of 21 February 1990, Series A no. 172, p. 18, § 41; López Ostra v. Spain, judgment of 9 December 1994, Series A no. 303-C, pp. 54-55, § 51; and Hatton and Others v. the United Kingdom [GC], no. 36022/97, § 98, ECHR 2003-VIII).
In the proceedings before the German courts,
the applicant’s individual interest in preserving the economic basis
of her family was at stake.
The domestic courts had to weigh this interest against the defendant creditor’s interest in the repayment of the loan granted to the applicant’s husband. This interest in liquidation of debts must be considered as an interest also of the community as a whole in view of the fact that it concerns the protection of the rights of others, a legitimate aim under paragraph 2 of Article 8. Moreover, allowing the enforcement of contractual claims of private parties serves legal certainty and may thus be seen as being in the interest of the economic well-being of the country, another legitimate aim under Article 8 § 2.
In assessing whether the German courts struck a fair balance between these competing interests, the Court notes that the Federal Court of Justice expressly considered that section 1365 of the Civil Code and its protection of the last family assets also applied if a spouse had disposed of (almost) all of his or her property for the benefit of a creditor and irrespective of the repercussions of the invalidity of his disposition on the latter. That court thus based its judgment on the assumption that the pledge of the bonds by the applicant’s husband had been void and that M.S. had initially had a claim against the defendant bank for payment of the amount of money the bank had obtained when the bonds were redeemed.
In a thoroughly reasoned judgment, the Federal Court of Justice then found that a spouse’s interest did not, however, outweigh the creditor’s interest under all circumstances and did not shield the applicant from all reductions of the family’s assets, in particular those resulting from compulsory execution or from set-offs.
Having regard to the State’s margin of appreciation in securing the economic basis of the individual’s family life, the Court cannot find that in the circumstances of the case the domestic courts failed to strike a fair balance between the conflicting interests.
It follows that this part of the application must be dismissed as manifestly ill-founded, pursuant to Article 35 §§ 3 and 4 of the Convention.
2. The applicant further complained that her right to a hearing and the prohibition of discrimination had been disregarded in that the Federal Court of Justice had failed to give her an opportunity to reply to the defendant’s belated written observations. Moreover, her right to a fair trial had been breached in that the Karlsruhe Court of Appeal had refused to grant her legal aid.
The applicant relied on Articles 6 and 14 of the Convention which, in so far as relevant, provide:
“(1) In the determination of his civil rights and obligations ..., everyone is entitled to a fair ... hearing ... by [a] ... tribunal ...”
“The enjoyment of the rights and freedoms set forth in [the] Convention shall be secured without discrimination on any ground such as sex, race, colour, language, religion, political or other opinion, national or social origin, association with a national minority, property, birth or other status.”
(a) Concerning the refusal to grant the applicant an opportunity to reply to the defendant’s observations, the applicant argued that in the proceedings before the Federal Court of Justice she had been unable to reply to the defendant’s voluminous submissions which she had received only one day before the hearing. In particular, the principle of equality of arms had been disregarded in that her request to be granted leave to respond to the defendant’s observations in writing after the hearing had been rejected, contrary to the applicable legal provision, namely section 283 of the Code of Civil Procedure (see Relevant domestic law above).
The Court notes at the outset that it is not called upon to substitute its own assessment of whether the conditions of section 283 of the Code of Civil Procedure were met for that of the Federal Court of Justice. The Court’s task is to ascertain whether the proceedings in their entirety, including the way in which evidence was permitted, were “fair” within the meaning of Article 6 § 1 (compare, inter alia, Dombo Beheer B.V. v. the Netherlands, judgment of 27 October 1993, Series A no. 274-A, pp. 18-19, § 31).
The Court reiterates that, in civil proceedings,
the principle of equality of arms implies that each party must be afforded
a reasonable opportunity to present his or her case under conditions
that do not place him or her at a substantial disadvantage vis-à-vis
his or her opponent (see, among other authorities, Dombo Beheer B.V., cited above, p. 19, § 33; Ankerl v. Switzerland, judgment of 23 October 1996, Reports of Judgments and Decisions 1996-V, pp. 1567-68, § 38;
and Others v. Liechtenstein, no. 63151/00, § 54, 19 May 2005).
Moreover, the concept of a fair trial, of which equality of arms is
one aspect, implies the right for the parties to have knowledge of and
to comment on all evidence adduced or observations filed (see, for instance, Nideröst-Huber
v. Switzerland, judgment of 18 February 1997, Reports 1997-I, p. 108, § 24, and
Steck-Risch, cited above, § 55).
In the present case the Court notes that the applicant received the defendant’s observations in reply to her own written submissions prior to the hearing in the Federal Court of Justice. The applicant did not claim that she (or her counsel) had no knowledge of the content of the defendant’s submissions, running to twelve pages, at the time of the hearing.
In examining whether the applicant, in view of the very short period of only one day between the receipt of the defendant’s written observations and the hearing, had been afforded a reasonable opportunity to comment on the defendant’s repeated submissions at the hearing alone and thus properly to present her case and her evidence before that court, regard must be had to the proceedings in their entirety. The Court observes in this connection that the question of the validity of a set-off of the defendant bank’s claim for repayment of the loan against the claim under section 1365 of the Civil Code, which was pleaded again by the defendant in its submissions in question, had previously been addressed in the proceedings before the lower courts.
In these circumstances, and having regard to
the fact that the defendant’s submissions were not very long, the
Court concludes that the applicant was afforded a reasonable opportunity
to comment on the defendant’s submissions at the hearing itself and
had not been placed at a substantial disadvantage vis-à-vis her opponent
in the presentation of her case.
The conduct of the proceedings before the Federal Court of Justice did not, therefore, infringe the applicant’s right to a fair trial under Article 6 § 1.
As the principle of equality of arms, being an aspect of the right to a fair trial, offers the applicant special protection from unjustified differences in treatment in civil proceedings, no separate issue arises under Article 14, read in conjunction with Article 6 § 1, of the Convention.
It follows that this part of the application must likewise be rejected as manifestly ill-founded, pursuant to Article 35 §§ 3 and 4 of the Convention.
(b) The Court has examined the applicant’s complaint, as submitted by her, about the refusal of legal aid in the proceedings before the Court of Appeal. However, having regard to all the material in its possession, the Court finds that this complaint does not disclose any appearance of a violation of the rights and freedoms set out in the Convention or its Protocols.
It follows that this part of the application must also be dismissed as manifestly ill-founded, pursuant to Article 35 §§ 3 and 4 of the Convention.
For these reasons, the Court unanimously
Declares the application inadmissible.
Claudia Westerdiek Peer Lorenzen
SCHAEFER v. GERMANY DECISION
SCHAEFER v. GERMANY DECISION