AS TO THE ADMISSIBILITY OF
Application no. 4533/02
by Monika FREILINGER and Others
The European Court of Human Rights (Third Section), sitting on 9 February 2006 as a Chamber composed of:
Mr B.M. Zupančič, President,
Mr L. Caflisch,
Mrs M. Tsatsa-Nikolovska,
Mr V. Zagrebelsky,
Mrs E. Steiner,
Mrs A. Gyulumyan,
Mr David Thór Björgvinsson, judges,
and Mr V. Berger , Registrar,
Having regard to the above application lodged on 14 January 2002,
Having regard to the observations submitted by the respondent Government and the observations in reply submitted by the applicants,
Having deliberated, decides as follows:
The applicants, Monika and Sascha Freilinger and Hildegard Hofmann, are Austrian nationals. They were born in 1959, 1980 and 1967, respectively. They live in Lengenfeld and Gobelsburg, respectively. They were represented before the Court by Mr H. Malek, a lawyer practising in Krems. The respondent Government were represented by their agent Ambassador F. Trauttmansdorff, Head of the International Law Department at the Federal Ministry of Foreign Affairs.
A. The circumstances of the case
The facts of the case, as submitted by the parties, may be summarised as follows.
Upon the applicants’ request the Krems Regional Court sitting as a Labour and Social Court (Landesgericht als Arbeits-und Sozialgericht) on 27 December 2000 and on 9 January 2001, respectively, ordered the F company to pay (Zahlungsbefehl) the first applicant 1,056.81 EUR, the second applicant 6,276.46 EUR and the third applicant 4,247.87 EUR. On 2 February 2001 these orders became enforceable.
On 13 February 2001 the Regional Court opened bankruptcy proceedings concerning the F company. This decision was published in the bankruptcy data base (Insolvenzdatei) in the internet on 14 February 2001.
On 19 February 2001 the applicants requested the Vienna District Court (Bezirksgericht) to enforce the above-mentioned payment orders by selling the F company’s movable property (Fahrnisexekution) and by granting the applicants a lien on outstanding accounts which the F company held against E.F., F.S. and I.S. (Forderungsexekution).
On 21 February 2001 the District Court granted this application and ordered enforcement of the payment orders (Exekutionsbewilligung) under Sections 249 and 294 of the Enforcement Act (Exekutionsordnung). It appears that the District Court apparently disregarded Section 10 of the Bankruptcy Act (see Relevant domestic law and practice) when it granted this request.
On 6 March 2001 E.F., F.S. and I.S., who were debtors of the F company and against whom that company had outstanding claims, appealed against this decision. They submitted that the enforcement order was unlawful as bankruptcy proceedings against the F company had been opened on 13 February 2001 and that, following the decision to open bankruptcy proceedings, they were no longer allowed to honour individual request for enforcement. The appeals were not transmitted to the applicants.
At the same day the bankruptcy trustee, referring to Section 10 of the Bankruptcy Act (Konkursordnung), requested the District Court to cancel enforcement proceedings.
With decisions of 26 March and 30 March 2001 respectively, the Vienna Regional Court remitted the file back to the District Court as it found that the appeals of 6 March 2001 needed improvement. On 9 and 19 April 2001 respectively these decisions were served on the applicants’ counsel.
E.F., F.S. and I.S. subsequently remedied the defects of the appeals. The appeals were not transmitted to the applicants.
With decisions of 3 August, 28 September 2001 and 11 October 2001 the Regional Court rejected the appeals concerning the enforcement of the order to pay by selling the F company’s movable property, as it noted that E.F., F.S. and I.S. had no legal standing in this regard, because they were not affected by that part of the order.
It granted, however, the appeals concerning the enforcement of the order to pay by granting a lien on the F company’s outstanding accounts against E.F., F.S. and I.S. It referred in this regard to Section 10 of the Bankruptcy Act. The court further noted that, according to relevant case-law and doctrine, it was for the person requesting an enforcement order to substantiate already in the application why enforcement under the Enforcement Act should be admissible irrespective of the opening of the bankruptcy proceedings. In the present case, the applicants had not made such submissions in their applications. The Krems Regional Court had opened bankruptcy proceedings against the F company on 13 February 2001. This decision had been published in the bankruptcy data base (Insolvenzdatei) on 14 February 2001. The enforcement order had been issued only on 21 February 2001 and was therefore unlawful. The court further noted that the applicants had filed their request for enforcement of the payment order on 19 February 2001, although bankruptcy proceedings had already been pending at this time. It therefore ordered them to reimburse the costs of the appeal proceedings, i.e. 196.88 EUR to be paid by the first applicant, 368.50 EUR to be paid by the second applicant, and 294.97 EUR to be paid by the third applicant.
B. Relevant domestic law and practice
The enforcement of judicial decisions is regulated by the Enforcement Act (Exekutionsordnung), which provides for the satisfaction of a pecuniary claim by seizure of individual assets of the debtor (Einzelexekution).
However, after the commencement of bankruptcy proceedings against the debtor, individual satisfaction of a creditor gives way to collective satisfaction on a quota basis of all creditors with pecuniary claims (Generalexekution). The execution of an individual claim under the Enforcement Act is in principle no longer possible.
Accordingly, Section 10 of the Bankruptcy Act stipulates that, after the commencement of bankruptcy, no right to a lien or to a payment may be obtained from a court in respect of assets forming the bankrupt’s estate on account of a claim against the bankrupt. According to Section 2, bankruptcy shall take effect from the day following its official publication.
The applicants complained that in the proceedings on the garnishees’ appeals against the enforcement order they had not been informed of the appeals and had not been given the possibility to react thereto, which was in breach of the principle of equality of arms, as guaranteed by Article 6 § 1 of the Convention.
The applicants complained about a breach of the principle of equality of arms, as guaranteed by Article 6 § 1 of the Convention, in the proceedings concerning the garnishees’ appeals on their enforcement order.
Article 6 § 1, as far as relevant, reads as follows:
“In the determination of his civil rights and obligations ..., everyone is entitled to a fair ... hearing ... by [a] ... tribunal...”
The Government contested that Article 6 was applicable to the enforcement proceedings at issue. They argued that in enforcement proceedings in general no decision is taken on the civil rights in dispute, such proceedings requiring a separate decision on the merits. Apart from cases concerning the length of proceedings and cases concerning the lack of implementation of a court decision, Article 6 was applicable to enforcement proceedings only in exceptional circumstances, namely when such proceedings involved the determination of the merits of the underlying claim. The Government pointed out that for such constellations the Austrian legal system provided specific actions to be filed under the Enforcement Act which are considered in civil proceedings in compliance with Article 6 of the Convention. In all other cases, enforcement proceedings serve exclusively the implementation of a final decision and, in the interests of efficiency and facility, are basically of a one-sided nature. The mere fact that in the present case the decision given in enforcement proceedings included also the order to pay the garnishees’ costs of the appeal proceedings did not render Article 6 applicable to the enforcement proceedings. The Government finally contested that, even assuming applicability of Article 6, the present proceedings had been in breach with the principle of equality of arms. They submitted that, even if the appeals had been served on the applicants, their submissions would not have changed the outcome of the proceedings at issue. Furthermore, they were in any event informed about the appeals as a copy had been transmitted to them when the Regional Court requested the garnishees to remedy defects of the writ.
The applicants contended that Article 6 was applicable to the proceedings at issue. They argued that decisions in enforcement proceedings concerned the respective party’s rights, as they concerned also a party’s financial obligations by ordering him/her to pay the costs. While it was true that enforcement proceedings were mainly of a one-sided nature, in case of certain requests, such as requests to suspend or cancel enforcement proceedings, the opponent party had to be given the opportunity to comment. They further referred to the case Beer v. Austria (no. 30428/96, 6 February 2001), in which the Court had found a breach of Article 6 in that in cost proceedings separate from the main proceedings an appeal by the opponent had not been served on the applicant. They finally asserted that there had also been a breach of the principle of equality of arms in that the garnishees had been given the opportunity to amend their appeal, whereas they had had no opportunity to amend their request for enforcement.
The Court notes that the present case does not raise an issue in respect of the applicants’ right to a court. In any event, the applicants did not complain before the Court about the Austrian authorities’ failure or delay to execute a final judicial decision. Instead, the applicants are complaining about the alleged unfairness of the enforcement proceedings as such.
It is true that in respect of enforcement proceedings the Commission, in the case of Krone-Verlag GmbH and Mediaprint Anzeigen GmbH & Co KG against Austria (no. 28977/95, Commission decision of 21 May 1997, with further references), found Article 6 to be applicable as the respective enforcement proceedings concerned questions which involved a determination of the applicant’s civil rights and obligations, namely a decision on the applicant’s action for discontinuation of the enforcement proceedings. In principle, however, the Court has consistently held that proceedings annexed to main proceedings, which do not involve a decision on the merits of the case, fall outside the scope of Article 6 of the Convention (see APIS a.s v. Slovakia (dec.), no.39754/98, 13 January 2000; concerning interlocutory proceedings relating to an interim injunction; see further Lamprecht v. Austria (dec.), no. 71888/01, 25 March 2004; concerning proceedings for the preservation of evidence).
The Court notes that the proceedings at issue concerned the enforcement of the applicants’ clearly defined civil claims. The applicants’ right to claim enforcement was never put into question and indeed was not at issue in those proceedings. The proceedings in the present case concerned the question whether the District Court could enforce the applicants’ claim by means of individual enforcement proceedings, i.e. by granting a lien on outstanding accounts which the debtor held against other persons. Indeed, the proceedings were conducted separately from the main proceedings and did not involve the examination of the underlying decisions or any other claim incurred during the main proceedings. The Court also observes that the prohibition of individual enforcement proceedings on specific claims under Section 10 of the Bankruptcy Act, which the District Court, probably by mistake, had disregarded when granting individual enforcement on 21 February 2001, did not prevent the applicants from seeking enforcement of the payment orders of 27 December 2000 and 9 January 2001 by participating in the bankruptcy proceedings.
The Court, therefore, finds that the enforcement proceedings at issue are comparable to the proceedings in the above cited cases APIS a.s. v. Slovakia and Lamprecht v. Austria.
In conclusion, the enforcement proceedings at issue did not involve a “determination” of the applicants’ civil rights or obligations within the meaning of Article 6 § 1.
It follows that the application is incompatible ratione materiae with the provisions of the Convention, within the meaning of Article 35 § 3 of the Convention, and must be rejected pursuant to Article 35 § 4.
For these reasons, the Court unanimously
Declares the application inadmissible.
Boštjan M. Zupančič
FREILINGER AND OTHERS v. AUSTRIA DECISION
FREILINGER AND OTHERS . v. AUSTRIA DECISION