CEDH · CASELAW;JUDGMENTS;CHAMBER;ENG — 12 décembre 2013

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CROATIA   (Application no. 39544/05)                   JUDGMENT     STRASBOURG   12 December 2013     FINAL   12/03/2014   This judgment has become final under Article 44 § 2 of the Convention. It may be subject to editorial revision.   In the case of Zagrebačka banka d.d. v. Croatia,   Isabelle Berro-Lefèvre, President,   Elisabeth Steiner,   Khanlar Hajiyev,   Linos-Alexandre Sicilianos,   Erik Møse,   Ksenija Turković,   Dmitry Dedov, judges, and André Wampach, Deputy Section Registrar, Having deliberated in private on 19 November 2013, Delivers the following judgment, which was adopted on that date: PROCEDURE 1.     The case originated in an application (no. 39544/05) against the Republic of Croatia lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (“the Convention”) by Zagrebačka banka d.d. (“the applicant bank”), a company incorporated under Croatian law, on 13 October 2005. 2.     The applicant bank was represented by Ms D. Rose Q.C. of Blackstone Chambers, a barrister practising in London, Mr B. Porobija of Law Firm Porobija & Porobija, an advocate practising in Zagreb, and Mr   A.   Walls and Ms J. Masterson of Linklaters Solicitors, solicitors practising in London. The Croatian Government (“the Government”) were represented by their Agent, Ms Š.   Stažnik. 3.     The applicant bank alleged, in particular, that the enforcement proceedings leading to the seizure of a substantial amount of money from its account had been unfair, and that the seizure itself and/or the subsequent distribution of the sum seized in the bankruptcy proceedings opened against the enforcement creditor had entailed a violation of its right to peacefully enjoy its possessions. 4.     On 12 November 2007 and 8 September 2009 the application was communicated to the Government. 5.     On 13 January 2011 the Chamber decided to adjourn the examination of the application awaiting the outcome of the case of Kotov v. Russia (no.   54522/00), that was pending before the Grand Chamber at the time. 6.     On 19 November 2013 the Chamber decided to dispense with a hearing. THE FACTS I.     THE CIRCUMSTANCES OF THE CASE 7.     The applicant bank, Zagrebačka banka d.d., is a joint stock company incorporated under Croatian law which has its registered office in Zagreb. A.     Civil proceedings 1.     Principal proceedings 8.     The applicant bank was founded on the basis of a “self-management agreement” ( samoupravni sporazum , hereafter “the founding agreement”) concluded on 8 July 1986 between several companies (at the time called “organisations of associated labour”). One of the parties to the agreement, company Textil, contributed, as a founder, some eleven billion Yugoslav dinars (hereafter “the establishment sum”). 9.     It appears that on 24 June 1992 Textil notified the applicant bank of the termination of the above agreement and requested repayment of the establishment sum. As the applicant bank refused to repay, in 1992 Textil brought a civil action in the Zagreb Commercial Court ( Trgovački sud u Zagrebu ) seeking the refund, plus statutory default interest ( zakonska zatezna kamata ). The applicant bank replied that during its transformation into a joint stock company in November 1989 it had made the plaintiff its shareholder and assigned to it a certain number of shares corresponding to the establishment sum. 10.     On 7 June 1995 the court delivered a judgment (hereafter “the original judgment”), ruling for the plaintiff. It ordered the applicant bank to pay the plaintiff the principal amount of 1,100 Croatian kunas (HRK) plus statutory default interest. The operative part of that judgment read as follows: “I.   The defendant ZAGREBAČKA BANKA d.d., Zagreb, Paromlinska 2, is ordered to pay the plaintiff TEXTIL import-export d.d. from Zagreb, Šoštarićeva 10, the amount of HRK 1,100 plus statutory default interest in accordance with the applicable regulations stipulating the interest rate and the Interest Rate Act, accruable from 15   September 1986 until the date of payment, as well as the costs of the proceedings in the amount of HRK 900, all within eight days. II.   The alternative claim, for 12,272 shares with the pertaining outstanding dividends, is dismissed.” 11.     The court held that the applicant bank had not been entitled to transform the funds received into shares without Textil’s consent. Thus, Textil had been entitled to terminate the 1986 agreement and request repayment. The applicant bank appealed. 12.     On 31 October 1995 the High Commercial Court ( Visoki trgovački sud Republike Hrvatske ) dismissed the appeal and upheld the first-instance judgment, endorsing the reasons given therein. The original judgment thus became final. 13.     It appears that the applicant bank did not attempt to lodge an appeal on points of law ( revizija ) with the Supreme Court against the second-instance judgment, nor did it lodge a constitutional complaint with the Constitutional Court. 2.     Proceedings following the applicant bank’s petition for reopening 14.     On 5 January 2000 the applicant bank filed a petition for reopening of the proceedings with the Zagreb Commercial Court, seeking to have the above first- and second-instance judgments set aside. It argued that Textil had already ceased to exist as a legal entity by 15 March 1994, and therefore after that date did not have standing to sue in the above civil proceedings. In its petition the applicant bank relied on the extract from the register of commercial companies ( sudski registar ) of 6   December 1999 according to which Textil had been deleted from that register on 15 March 1994 following its incorporation into company Turist Trip d.o.o. 15.     On 13 April 2004 the Zagreb Commercial Court allowed the applicant bank’s petition and set aside its judgment of 7 June 1995 and the judgment of the High Commercial Court of 31 October 1995. 16.     Following an appeal by the plaintiff, on 22 October 2004 the High Commercial Court quashed the first-instance decision and remitted the case. 17.     In the resumed proceedings, on 8 February 2006 the Zagreb Commercial Court declared the applicant bank’s petition for reopening inadmissible as belated. In particular, the court established that the applicant bank had already become aware of the facts on which it had based its petition for reopening by 23 December 1998, whereas it had filed that petition on 5 January 2000, that is, outside the statutory time-limit of thirty days. In the absence of appeals that decision became final on 27 February 2006. B.     Assignment contract of 18 December 1995 18.     Meanwhile, on 18 December 1995 Textil, as the original judgment’s creditor, concluded an assignment contract ( ugovor o cesiji ) by which it assigned its claim against the applicant bank to company Texhol d.o.o. The signatures of the directors of the two companies on the assignment contract were certified by a notary public. The majority stockholder of Textil and the sole shareholder of Texhol (as well as of Turist Trip) was a certain Mr   A.K. 19.     The applicant bank disputed the validity of that assignment contract, claiming that on 15 March 1994 Textil had ceased to exist as a legal entity following its incorporation into Turist Trip company (see paragraph 14 above). On 4 May 1998 it instituted separate civil proceedings for that contract to be declared non-existent, and eventually, on 16 October 2007, obtained a final judgment in its favour (see paragraphs 88-94 below). C.     Enforcement proceedings 20.     In the meantime, on 15 January 1996 Texhol applied to the Zagreb Commercial Court for enforcement of the original judgment. 21.     On 26 January 1996 that court issued a writ of execution ( rješenje o izvršenju ). It ordered the financial institution operating the applicant bank’s account, which was at the time the Domestic Payment Transfer Agency ( Zavod za platni promet subsequently renamed Financijska agencija – hereafter “ZAP” or “FINA”), to collect the amount corresponding to the judgment debt and transfer it to Texhol’s account. The writ read as follows: “I.   The debtor is ordered to pay the creditor’s claim in the amount of HRK 1,100 plus statutory default interest in accordance with the applicable regulations stipulating the interest rate and the Interest Rate Act, accruable from 15   September 1986 until the date of payment, as well as the costs of the [civil] proceedings in the amount of HRK 900. II.   The debtor is ordered to reimburse the creditor the costs of these [enforcement] proceedings, as well as to pay statutory default interest on the amount of those costs accruable from the date of the issuance of the writ of execution until satisfaction of the creditor following the service of the writ. III.   In order to satisfy the creditor’s claim referred to under paragraph I. of this writ of execution t h e e n f o r c e m e n t i s a l l o w e d to the debit of the account of the debtor ZAGREBAČKA BANKA d.d. held with ZAP Zagreb, giro account no. [...], and to the credit of the creditor TEXHOL, giro account no. [...] held [also] with ZAP Zagreb, and in accordance with the assignment agreement between TEXTIL import-export d.d. and TEXHOL d.o.o. of 18   December 1995. ZAP is ordered to carry out this writ by transferring the funds from the debtor’s giro account no. [...] with ZAP Zagreb to the creditor’s giro account no. [...] with ZAP Zagreb. Should there be no funds in the debtor’s giro account, ZAP shall freeze the account and effect the payment as soon as funds are available.” 22.     On 31 January 1996 the applicant bank objected ( prigovor ) to the writ. In its objection the applicant bank disputed the validity of the assignment contract between Textil and Texhol of 18 December 1995, claiming that on 15 March 1994 Textil had ceased to exist as a legal entity following its incorporation into company Turist Trip d.o.o. (see paragraph 19 above). As the writ of execution was not based solely on the original judgment as the enforcement title ( izvršna isprava ), but also on the assignment contract designated as the supplementary enforcement title ( dopunska izvršna isprava ), the applicant bank argued that Texhol was not entitled to seek enforcement of the original judgment. 23.     On 8 February 1996 the Zagreb Commercial Court dismissed the applicant bank’s objection. Relying on section 22(1) of the Enforcement Proceedings Act, the court held that because the assignment contract had been certified by a notary public the applicant bank’s argument that the judgment debt had not been validly transferred to Texhol could not be accepted until proven otherwise by a final court judgment (see paragraph 146 below). The applicant bank appealed against that decision. 24.     On 12 March 1996 the High Commercial Court dismissed the applicant bank’s appeal and upheld the first-instance decision, endorsing the reasons given therein. 25.     The calculation of statutory default interest on the principal amount of HRK 1,100 made by ZAP in the execution of the writ gave a total amount of HRK 5,416,078.56. On 12 February 1996 ZAP seized that amount from the applicant bank’s account and transferred it to Texhol’s account. 26.     On an unspecified date in February 1996 Texhol’s advocate wrote to ZAP complaining that the interest for the period between 9 December 1988 and 6 October 1989 had been calculated incorrectly because the “revaluation interest” had not been taken into consideration. 27.     In its reply of 26 February 1996 ZAP responded that the interest had been calculated correctly. It explained: “In your complaint you requested the application of another type of interest, namely revaluation interest, the rate of which is different from statutory interest, and which was not expressly stipulated in the writ of execution, so we cannot calculate it.” 1.     Continuation of the enforcement: first attempt 28.     On 6 March 1996 Texhol applied to the Commercial Court, asking it to continue the enforcement because ZAP had miscalculated the amount of statutory default interest due. Texhol argued that ZAP had used the simple instead of the compound method and that it had not taken “revaluation interest” into account. 29.     On 9 June 1997 the court issued a decision ruling for Texhol. It ordered ZAP to recalculate the statutory default interest by taking revaluation interest into consideration and by using the compound method, and thereafter to satisfy the remainder of Texhol’s claim. The applicant bank appealed, arguing that it had not been informed of Texhol’s application to continue the enforcement nor of the resultant decision of the Commercial Court. 30.     On 23 December 1997 a panel of the High Commercial Court, composed of judges Z.J., R.S. and L.Ć., dismissed the appeal and upheld the first-instance decision. On 9 March 1998 the State Attorney lodged a request for protection of legality ( zahtjev za zaštitu zakonitosti ) to the Supreme Court against the second-instance decision. 31.     On 9 September 1998 the Supreme Court allowed the request, quashed the lower courts’ decisions for procedural errors, and remitted the case to the first-instance court. It held that the principle of adversarial hearing had been breached because the applicant bank had not been given the opportunity to comment on Texhol’s application to continue the enforcement. It also instructed the lower courts to establish the type of statutory default interest (depending whether the founding agreement constituted a contract of a commercial or non-commercial nature) as well as its rate and method of calculation (simple or compound) in the resumed proceedings. The relevant part of that decision read as follows: “The enforcement court should have decided on the amount of interest claimed, that is, on the type of the statutory default interest, the rate and the method of calculation of the statutory default interest. ... Texhol do.o. is entitled to conduct the enforcement proceedings, which follows from the enclosed written assignment contract in which the signatures of the parties were certified by a notary public. [T]that document is a document certified in accordance with the law within the meaning of section 22 of the Enforcement Procedure Act, which entitles the assignee to [act as an enforcement creditor in] the enforcement proceedings ... Until the entry into force of the [1989] Amendments to the Obligations Act, which entered into force on 7 October 1989, the default interest rate accruable on claims arising from the [legal] relationships between persons performing an economic activity was prescribed by decisions on the statutory default interest rate, pursuant to section 277(2) of the Obligations Act, whereas the [statutory default] interest rate on other claims for payment of a sum of money was determined by inter-bank self-management agreements, pursuant to section 277(1) of the Obligations Act. In the resumed proceedings it is necessary for the court to decide on the type of default interest up to 7 October 1989, taking into account the [legal] relationship between the parties, because the type of statutory default interest was not specified in the enforcement proceedings, then on the rate of the statutory default interest from 15   September 1986 onwards, as well as on the method of calculation of the default interest.” 2.     Continuation of the enforcement: second attempt 32.     On 28 September 1999 Texhol d.o.o. was renamed Retag d.o.o. 33.     In the resumed proceedings, on 5   November 1999 the Commercial Court decided to obtain the opinion of a financial expert, and on 12   November 1999 instructed the expert to calculate the statutory default interest, bearing in mind that, in the court’s view, the founding agreement was to be qualified as commercial. 34.     On 11 January 2000 the court delivered a decision ordering ZAP to transfer from the applicant bank’s account the remaining amount of the creditor’s claim of HRK 263,077,597.48 plus statutory default interest accruable from 24 November 1999 until payment. The court dismissed the applicant bank’s arguments that the creditor’s claim had already been satisfied in full on 12 February 1996 and that the assignment contract of 18   December 1995 was not valid. 35.     On 14 February 2000 the applicant bank appealed against that decision to the High Commercial Court, at the same time asking for the enforcement to be postponed. Three days later the applicant bank submitted a motion for judges Z.J., R.S. and L.Ć. to withdraw, because they had sat in the panel of that court which, on 23   December 1997, had dismissed its previous appeal (see paragraph 30 above). It also requested withdrawal of the High Commercial Court’s president N.Š. On 19 April 2000 the Supreme Court dismissed the applicant bank’s motion for withdrawal of the High Commercial Court’s president, N.Š., whereupon, on 2 May 2000, he dismissed the motion for withdrawal of judges Z.J., R.S. and L.Ć. 36.     In addition, on 6 March 2000 the applicant bank lodged a constitutional complaint against the first-instance decision of 11   January 2000, at the same time asking the Constitutional Court to issue an interim measure that would postpone the enforcement. 37.     On 3 March 2000 the Commercial Court allowed the applicant bank’s motion and postponed the enforcement. However, on 16 May 2000 a panel of the High Commercial Court, composed of judges Z.J., N.Š. and R.S., allowed Retag’s appeal and reversed the first-instance decision by dismissing the applicant bank’s motion for postponement. 38.     On the same day the same panel of the High Commercial Court also dismissed the applicant bank’s appeal against the Commercial Court’s decision of 11   January 2000 (see paragraphs 34-35 above). 39.     On 23 May 2000 the applicant bank lodged a constitutional complaint against that second-instance decision, alleging violations of its constitutional rights to appeal, fair hearing, equality before the law and of ownership. 40.     On the same day the Constitutional Court allowed the motion for an interim measure submitted on 6 March 2000 and postponed the enforcement until it had decided on the applicant bank’s constitutional complaint of 23   May 2000. 41.     On 13 December 2000 the Constitutional Court allowed that constitutional complaint and quashed the decision of the Zagreb Commercial Court of 11 January 2000 (see paragraph 34 above) and the decision of the High Commercial Court of 16 May 2000 (see paragraph 38 above). It found violations of the applicant bank’s constitutional rights to appeal, fair hearing and equality before the law, but not of its constitutional right of ownership. The case was remitted to the Zagreb Commercial Court for the second time. 3.     Continuation of the enforcement: third attempt (a)     The proceedings leading to the decision of 3 October 2003 and the subsequent remedies 42.     In the resumed proceedings, on 10 July 2003 the Zagreb Commercial Court issued an instruction ( zaključak ) inviting the parties to lodge written submissions. By another instruction, of 1 September 2003, the court forwarded Retag’s submissions of 23 July 2003 to the applicant bank and scheduled a hearing for 23 September 2003. The applicant bank submitted that these instructions were never served on it and that consequently neither of its two representatives in the proceedings (a corporate lawyer and an advocate) attended the hearing. 43.     The hearing was nevertheless held as scheduled, in their absence. The judge appointed to hear the case noted in the record of the hearing that receipt of the letter containing summons for the applicant bank’s corporate lawyer I.T. had not been acknowledged, whereas the same letter sent to the applicant bank’s advocate D.J. had been returned with an “out of office” stamp. The judge also recorded in the record that the day before the hearing he had telephoned the advocate’s office and left a message with an employee that the hearing was scheduled for the following day. 44.     On 3 October 2003 the Commercial Court issued a decision, the relevant part of which read as follows: “III. On the basis of a ... decision of this court. ... of 26 January 1996 ... the Croatian National Bank is ordered to calculate the creditor’s claim in the amount of HRK   1,100, together with the following interest: - for the period from 15 September 1986 to 6 October 1989, interest at the rate [usually] paid at the place of performance on time savings deposits with no established purpose and with a term longer than one year, pursuant to section 277(1) of the Obligations Act; IV. When calculating the interest the Croatian National Bank is required to deduct from the sum arrived at on 12 February 1996 the amount of HRK 5,416,078 ... V. The remaining amount shall be seized by the Croatian National Bank without delay from the debtor’s account no. [...], held with the Croatian National Bank, and paid into the account of the creditor no. [...], held with Karlovačka banka d.d., and shall inform the court thereof.” 45.     In deciding the above the court took into consideration the creditor’s written pleadings of 25 July 2003, as well as the written pleadings of the applicant bank of 26 September 2003. It stressed that the issue of which interest rate was to be applied was of a legal rather than a technical nature. It qualified the founding agreement as a non-commercial contract, thereby effectively sidestepping the contestation as to the applicability of “revaluation interest” (see paragraphs 26-29 above), because that interest could only potentially be applied to claims arising out of commercial contracts. However, the court did not indicate the exact rate to be applied, but merely stated that it was the “interest at the rate paid at the place of performance on time savings deposits with no established purpose and with a term longer than one year” ( kamatu po stopi koja se u mjestu ispunjenja plaća na štedne uloge oročene bez utvrđene namjene preko godinu dana ). Nor did the court indicate the method of calculation of statutory default interest (simple or compound). Nonetheless, the court stated that in the period between 15   September 1986 and 6 October 1989 the statutory default interest rate stipulated in section 277(1) of the 1978 Obligations Act as in force at that period (see paragraph 126 below) had been calculated pursuant to the Inter-Bank Interest Rate Policy Self-Management Agreement (see paragraphs 133-137 below). 46.     On 14 October 2003 the applicant bank appealed to the High Commercial Court against that decision, asking at the same time for its execution to be postponed. In requesting postponement of enforcement the applicant bank argued that Retag’s claim against it had been extinguished by offsetting ( prijeboj ) the applicant bank’s claim against Textil for payment of HRK 14,921,617.82, together with interest on that amount calculated from 1 March 1993. It explained that over a number of years it had lent substantial sums of money to Textil, which had later been unable to repay those loans. Given that Textil had been incorporated into Turist Trip company on 15 March 1994, and that it had, on 18   December 1995, assigned the claim against the applicant bank to Texhol (later named Retag), the applicant bank had been entitled to offset its claim against Textil with Retag’s claim against the applicant bank, pursuant to section 440(2) of the 1978 Obligations Act, which entitled the debtor in the event of assignment to offset its debt against a claim existing at the time of assignment against either the assignor or the assignee (see paragraph 130 below). The applicant bank also requested that judges R.S., Z.J. and L.Ć., as well as the President of the High Commercial Court, N.Š., withdraw. In so doing the applicant bank merely stated that those judges had previously been involved in decision-making in the case, and that it had lodged several criminal complaints against them, which had not been decided on to that date. For that reason the applicant bank argued that it had cause to doubt their impartiality. 47.     Retag, for its part, also appealed against the first-instance decision of 3 October 2003, insisting on the application of “revaluation interest” and the compound method. 48.     On 13 October 2003 the applicant bank also lodged, and on 14 and 29 October 2003 supplemented, a constitutional complaint against the first-instance decision, asking at the same time for postponement of enforcement. 49.     On 27 October 2003 the Zagreb Commercial Court dismissed the applicant bank’s motion of 14 October 2003 for postponement of enforcement (see paragraph 46 above). At the same time the court also instructed the applicant bank to institute separate civil proceedings for the enforcement to be declared inadmissible ( parnica za proglašenje ovrhe nedopuštenom ), given that in its appeal of the same date the applicant bank argued, inter alia , that the continuation of enforcement of the original judgment was inadmissible because Retag’s claim against it had been extinguished by the offset of its claim against Retag. The applicant bank instituted those proceedings on 11   November 2003 (see paragraphs 113-116 below). The relevant part of that decision reads as follows: “The motion for postponement of enforcement is based on the [enforcement] debtor’s argument that the [enforcement] creditor’s claim was extinguished by an offset, which does not constitute a ground for postponing the enforcement. Moreover, the [enforcement] debtor’s mere contention that it has a larger claim against the [enforcement] creditor does not constitute significant damage, as has been established by the case-law of the [domestic] courts. Apart from the fact that the [enforcement] creditor’s claim is based on an enforcement title, whereas the [enforcement] debtor does not possess any decision in its favour, it has to be noted that the [enforcement] debtor could have relied on such a defence earlier, during the [principal] civil proceedings. In this court’s view, no one should benefit from evident abuse of process during proceedings. Therefore, the motion for postponement of enforcement must be dismissed.” 50.     On 8   December 2003 the President of the Commercial Court declared the applicant bank’s motion for withdrawal of judges N.Š., R.S., Z.J. and L.Ć. of 14 October 2003 inadmissible (see paragraph 46 above). In so doing she relied on section 73 of the Civil Procedure Act (according to which once a court has decided on a motion for withdrawal, any subsequent motions for withdrawal of the same judges in the same proceedings are to be declared inadmissible, see paragraph 145 below), and the fact that earlier in the same proceedings, on 19 April 2000, the Supreme Court had already dismissed a motion for withdrawal of Judge N.Š, and on 2 May 2000 the High Commercial Court had dismissed a motion for withdrawal of judges R.S., Z.J. and L.Ć (see paragraph 35 above). 51.     On 6 April 2004 the High Commercial Court, sitting in a panel composed of judges Z.M., R.S. and K.M., dismissed appeals against the first-instance decision of 3   October 2003, endorsing the reasons given therein. It also dismissed the applicant bank’s appeal against the first-instance decision of 27 October 2003 refusing its motion for postponement of enforcement. It held as follows: “As a ground for postponement of enforcement the [enforcement] debtor states that it intends to lodge an appeal. However, no valid grounds for postponement of enforcement are discernible from the appeal ... As regards the argument in the appeal concerning the lack of capacity to act as the [enforcement] creditor, the court finds that [Retag] is entitled to act in that capacity on the basis of the assignment contract [of 18 December 1995] until proven otherwise by a final judgment. ... [T]he case file contains a written assignment contract with the parties’ signatures, certified by a notary public. [T]hat document is a deed certified in accordance with the law within the meaning of section 22 of the Enforcement Procedure Act, which entitles the assignee to act [as the enforcement creditor] in the enforcement proceedings. [Since] enforcement proceedings are strictly formal, this court has full confidence in the certified notarial deed ... It has to be noted that the first-instance court correctly found that the enforcement debtor had received from the enforcement creditor’s predecessor a sum which represented the equivalent of 56 million German marks, had used it from 1986 until the present day, and had refused to return it despite the final court judgments. Furthermore, the enforcement debtor claims that the payment of HRK   5,416,078, which represents about 3% of the value of the principal debt on the day the debt became due, had settled the debt in full. During these enforcement proceedings seven first-instance decisions were rendered postponing enforcement in this case, as well as eleven decisions on motions for withdrawal of certain judges of the Commercial Court, the High Commercial Court and the Supreme Court. The case file contains six decisions of the High Commercial Court, two decisions of the Supreme Court [and] two decisions of the Constitutional Court, neither of which concerns motions for withdrawal of judges. Despite all this the enforcement creditor has not managed to satisfy its claim [endorsed by a final court judgment]. It follows from all of the above that the enforcement debtor’s appeal is ill-founded and thus must be dismissed ...” 52.     On 2 June 2004 the applicant bank lodged a constitutional complaint against that decision, alleging violations of its constitutional rights to appeal, fair hearing and equality before the law. 53.     In addition, on 14 June 2004 the State Attorney lodged a request for protection of legality against the same decision. 54.     On 4 October 2004 the Commercial Court declared the State Attorney’s request inadmissible, finding that such a remedy no longer existed under the relevant legislation. On 18 January 2005 the High Commercial Court dismissed an appeal by the State Attorney and upheld the first-instance decision. 55.     On 7 July 2005 the Constitutional Court declared the applicant bank’s constitutional complaint inadmissible, finding that the decision complained of was unrelated to the merits of the case. (b)     The proceedings leading to the instruction of 28 October 2003 and the subsequent remedies 56.     Meanwhile, on 14 October 2003 the Croatian National Bank wrote to the Commercial Court explaining that it was unable to calculate the statutory default interest as indicated in that court’s decision of 3 October 2003 (see paragraphs 44-45 above) because it did not have the necessary information about interest rates on time savings deposits or the text of the Inter-Bank Interest Rate Policy Self-Management Agreement referred to in that decision. However, it had asked several banks to provide that information and notified the court that it would proceed with the execution of the court’s decision as soon as it had received the necessary data. The applicant bank submits that that letter was never served on it. 57.     On 16 and 20 October 2003 Retag asked the Commercial Court to expedite the proceedings and informed it that the Croatian National Bank had not yet transferred the funds from the applicant bank’s account. 58.     On an unspecified date in October 2003 the judge of the Commercial Court appointed to hear the case wrote to ZAP (which had in the meantime been renamed the Financial Agency, or FINA) informing it of the Croatian National Bank’s inability to calculate the statutory default interest owing to the lack of necessary information concerning interest rates on time savings deposits. It requested FINA to provide that information and to calculate the statutory default interest as indicated in the Commercial Court’s decision of 3   October 2003. 59.     On 27 October 2003 FINA made the calculation as requested and forwarded it to the Commercial Court. The calculation suggests that the simple interest method was used to calculate the statutory default interest in the period between 10 August 1986 and 31 December 1987, whereas the compound interest method was used in the period between 1 January 1988 and 27   October 2003. The amount was therefore determined at HRK   165,167,676.75. 60.     The applicant bank submits that neither the Commercial Court’s request nor FINA’s calculation were ever served on it. 61.     On 28 October 2003 the Commercial Court issued an instruction to the Croatian National Bank to transfer, pursuant to FINA’s calculation, the amount of HRK 165,167,676.75 from the applicant bank’s account to Retag’s account. The instruction was served on the applicant bank on 24   November 2003. 62.     On 22   December 2003 the Croatian National Bank transferred the sum of HRK   168,618,419.60 pursuant to the instruction (the difference between the sum indicated in the instruction of 28 October 2003 and the sum transferred on 22   December 2003 is due to the accrued statutory default interest in the period between the date the instruction was issued and the date the sum was transferred). 63.     On 2 December 2003 the applicant bank appealed against the instruction of 28 October 2003 to the High Commercial Court notwithstanding the fact that no appeal was available against such a decision under Croatian law (see section 8(7) of the 1978 Enforcement Procedure Act in paragraph 146 below). It appears that no formal decision (to declare it inadmissible) has ever been taken on that appeal. At the same time it again asked for postponement of enforcement and withdrawal of judges N.Š., R.S., Z.J. and L.Ć. 64.     On 24 November 2003 the applicant bank also lodged, and on 2 and 18   December 2003 supplemented, a constitutional complaint against the instruction, asking at the same time for its enforcement to be postponed. On 14   April 2004 the Constitutional Court declared that complaint inadmissible, holding that the contested decision was unrelated to the merits of the case. 65.     On 28 August 2008 the Zagreb Commercial Court issued a decision to discontinue the enforcement proceedings, given that the enforcement was completed and that Retag as the enforcement creditor had on 12 December 2007 ceased to exist as a legal entity (see paragraph 87 below). 66.     Following an appeal by “the bankruptcy estate of Retag” (see paragraphs 87 and 155-156 below), on 14 October 2008 the High Commercial Court quashed the first-instance decision and instructed the lower court to stay the enforcement proceedings pursuant to section 212(4) of the Civil Procedure Act (see paragraph 145 below). (c)     Statements to the media by Judge N.Š. 67.     Meanwhile, on 6 November 2003 N.Š., a High Commercial Court, judge and its president in the period between 6 March 1995 and 6   March 2002, had been quoted in a newspaper article published by the daily Novi list in which he had made certain comments that, in the applicant bank’s view, were injudicious and hostile. The article, featuring a photo of Judge   N.Š. and entitled ‘[ N.Š ] : ZABA has to pay at least 28 million euros pursuant to the writ of execution’, the relevant part of which read as follows:   “‘ The principal debt of 56 million German marks (28 million euros) is indisputable – the question is only how the interest should be calculated ’, explains the former President and now judge of the High Commercial Court of the Republic of Croatia [N.Š.], against whom Zagrebačka banka has already brought criminal charges in 2001 in which it attempted to prove that [he] had abused his judicial authority in a case that may bring the bank to its knees due to enormous default interest accrued as a result of 11 years of court proceedings. ... [N.Š.] however emphasises that the bank could have pre-empted all of this if it had [re]acted in time: ‘ Enforcement has already been ordered three times, and each time the matter has been deliberately blurred by the amounts of principal debt and interest [being incorrect]. As far as I know, [the first-instance judge appointed to hear the case] last ordered the enforcement in the amount of 187 million kunas, whereas FINA calculated an amount several times higher due to the application of what is called the compound method of calculating interest. The bank itself calculates interest for its debtors in the same manner it complains against. I neither know, nor have I seen, let alone am connected to, the people from Textil. I have personally brought charges against an ‘anonymous person’ in Zaba. If the allegations in the criminal complaints [against me] were true, I can assure you that the State Attorney’s Office would have taken action against me ’, Š. argues.” 68.     On 24 March 2006 Judge N.Š. participated in the television programme ‘Kontraplan’ broadcast by Croatian Television. The relevant part of that programme was as follows: “ Narrator : Banks are bigger mafia than small and big criminal organisations, said N.Š., judge and former president, after failing to be elected President of the High Commercial Court. As well as banks, N.Š. has also assailed the State Attorney’s Office, judges of the Supreme Court and politicians. He has accused J.C. of favouring his son I.C., who after having been an advocate of Zagrebačka banka, became the President of the Supreme Court. He has accused S.L. of putting pressure on the Court together with bankers, and B.G. of tearing up a Commercial Court judgment. In addition, N.Š. suspects State Attorney M.B. of keeping judges obedient by not dealing with numerous criminal complaints against them. D.M. (host) : N.Š.’s frontal attack on the pillars of Croatian banking, as well as the judicial and political system, has raised several important issues. Should one trust [his] thesis that the Croatian economy is a hostage to corrupt lobbies? Are the answers given by those mentioned convincing, and which institutions in Croatia are going to assess them? Are N.Š.’s accusations confirmation to Eurocrats that Croatia really has a corrupt judiciary? Is it all about a play of the untouchables, in which no one is going to face the consequences? Tonight’s guest on ‘Kontraplan’ is: Judge N.Š., who is in his office in the High Commercial Court. Good evening, Mr Š. ... D.M. : Most of the public has perceived N.Š.’s reactions and accusations as revenge for not being elected President of the High Commercial Court. One of those mentioned, a former president of the Constitutional Court, who has been accused by N.Š. of favouring one party in the case of Zagrebačka banka versus Retag, shares this opinion. J.C. (former Constitutional Court President) : Everything said about Zagrebačka banka is totally untrue. I had a rule, and this was also a rule at the Constitutional Court, under which we always removed ourselves from every case in which a relative or someone else [connected with us] appeared in any role, such as that of an advocate. For example, my son was also a judge in the Supreme Court. Nevertheless these rulings also came to us and we always and in each case of this kind removed ourselves. No offence, but I think this is just dirt and one can only be disgusted by it. One can see this only as the cry of a desperate man who has failed in something, for example, here in becoming the President of the High Commercial Court, and who thinks he can entangle people and involve them among those he has probably worked with. D.M. : Mr Š., why does everybody, or most of the people, especially those who have been invited here, see your acts, that is your attacks, as the act of a desperate man who has lost all chance of getting a better position in the judiciary? N.Š. (judge of the High Commercial Court) : Well, I would not look at it in that way. D.M. : I understand that. N.Š. : Right at the beginning I would like to say that I was trying to talk about these issues while I was the president of the Court, however ... ... D.M. : I am sorry but what did you say? What did you try to draw attention to in these public appearances? N.Š. : I was trying to draw attention to the fact, and that was my point all along, that there is no independent judiciary, that the executive authority influenced it strongly; different lobbies influenced the operation of the courts. It was pretty obvious. I have written about it even today. ... D.M. : ... I would like to go back now to the main case, for which Mr N.Š. has also been attacked very often, and that is the Retag versus Zagrebačka banka case or the 169,000,000 kunas enforcement. In tomorrow’s Večernji list , Mr N.Š., with reference to you, the newspaper claims that father and son [J. and I.] C. saved Zagrebačka banka from enforcement in the Retag case in one day. Allegedly, it happened on 23 May 2000 ... Why did you find this case interesting? Was it, perhaps, evidence of an efficient judiciary and a good advocate? N.Š. : Well, a good advocate was also important, but the problem was the fact that Zagrebačka banka lost this case. It lost it at all levels, not only at the High Commercial Court, but also at the Supreme Court. Therefore, it [i.e. the bank] had to execute it [i.e. the judgment]. However, [the director of Zagrebačka banka] Mr   P.L. and Zagrebačka banka [itself] did not want that. Enforcement commenced which lasted about eleven years; it was the longest enforcement in our history. At the same time, Zagrebačka banka did not want to abide by the decision in any way and tried not to do so, which was its legal right, but ... ... N.Š. : ...You see, Zagrebačka banka, for example, has calculated such interests to its depositors, debtors, customers, which it did not want to pay to its creditor. Therefore, two types of criteria [i.e