CEDH · CASELAW;JUDGMENTS;CHAMBER;ENG — 19 juin 2014

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It may be subject to editorial revision.   TABLE OF CONTENTS   PROCEDURE THE FACTS I.     THE CIRCUMSTANCES OF THE CASE A.     The criminal case against Mr Golovkin B.     The first consignment of alcohol (337,104 bottles belonging to Belcourt and 120,317 bottles belonging to Uniya) 1.     Seizure and destruction of the first consignment (a)     Seizure (b)     First and second expert examinations of the quality of the alcohol (c)     Destruction of the alcohol 2.     The “special ruling” of the Baltiyskiy District Court 3.     Criminal investigation of the destruction of the alcohol 4.     Complaints by Uniya, Belcourt and Mr Golovkin under Article   125 of the CCrP (a)     Judicial review of the seizure (i)     Complaints by Uniya and Mr Golovkin (α)     First round (Article 125 proceedings) (β)     Second round (Article 125 proceedings) (γ)     Chapter 25 proceedings (ii)     Complaints by Belcourt (α)     First round (β)     Second round (b)     Judicial review of the destruction 5.     Tort claims by Belcourt and Uniya against the State and related proceedings (a)     Tort claims by Belcourt against the State concerning the seizure and destruction of 337,104 bottles of alcohol (i)     Proceedings before the commercial courts (α)     First round (tort claims related to the seizure and destruction) (β)     Second round (tort claims related to the destruction) (γ)     Third round (judicial review of the decision of the Alcohol Commission) (ii)     Proceedings before the courts of general jurisdiction (α)     First round (β)     Second round (γ)     Third round (b)     Tort claims of Uniya against the State concerning the seizure and destruction of 120,317 bottles of alcohol (i)     Tort claim by Uniya in the commercial courts (α)     First round (β)     Second round (ii)     Tort claim in the courts of general jurisdiction (α)     First, second, and third rounds of the proceedings (β)     Fourth round (γ)     Fifth round (δ)     Execution of the judgment of 27 January 2011 and liquidation of Uniya C.     The second consignment of alcohol (1,170,312 bottles) 1.     First decision to seize (attachment orders) and its review (a)     Seizure and expert examination of the second consignment (b)     First complaint by Mr Golovkin against the seizure 2.     Second decision to seize (removal of physical evidence) and its review (a)     Seizure (b)     Second complaint by Mr Golovkin against the seizure 3.     Attempts by Uniya to obtain the second consignment from the warehouses or to sell it 4.     Third decision to seize (removal of physical evidence) and its review (a)     Third seizure (b)     Third complaint by Mr Golovkin (c)     Complaint by Uniya under Article 125 of the CCrP about the seizure 5.     Destruction of the second consignment and its judicial review (a)     Destruction (b)     Constitutional complaint by Mr Golovkin (c)     Complaint by Uniya under Article 125 of the CCrP about the destruction of the alcohol (i)     First round (ii)     Second round 6.     Tort claim brought by Belcourt against Uniya 7.     Tort claims by Uniya against the State (a)     Proceedings before the commercial courts (i)     First round (ii)     Second round (b)     Proceedings before the courts of general jurisdiction (i)     Early rounds (ii)     Final round 8.     Tort action by Belcourt against the State D.     Seizure of 37,184 bottles of alcohol and compensation proceedings E.     Other court proceedings related to the seizure of the alcohol F.     Information on the status of the applicant companies. II.     RELEVANT DOMESTIC LAW AND PRACTICE 1.     Criminal responsibility for the offences imputed to Mr Golovkin 2.     Alcohol market regulations 3.     Physical evidence (exhibits) (a)     Under the old CCrP (b)     Under the new CCrP 4.     Attachment of property within criminal proceedings 5.     “Complaints” against unlawful administrative acts and “tort claims” against the State 6.     Judicial review of the investigator’s orders under the CCrP (a)     Under the old CCrP (b)     Under the new CCrP (complaints under Article 125) (c)     Special rulings 7.     Right to compensation for unlawful criminal prosecution 8.     Rules on tort liability of the State THE LAW I.     PRELIMINARY ISSUES A.     The Government’s request for the case to be discontinued B.     Withdrawal by the first applicant company of a part of its complaints; a complaint by the second applicant company about the same facts II.     ALLEGED VIOLATION OF ARTICLE 1 OF PROTOCOL No.   1 ON ACCOUNT OF THE DESTRUCTION OF THE ALCOHOL A.     Destruction of the first consignment 1.     The Government’s objection as to the loss of victim status by the applicant companies (a)     The Government’s submissions (b)     The applicant companies’ submissions 2.     The Court’s assessment (a)     The victim status of the second applicant company (b)     The victim status of the first applicant company B.     Destruction of the second consignment 1.     The Government’s non-exhaustion plea and the Court’s assessment thereof 2.     The parties’ submissions on the merits (a)     The applicant companies (b)     The Government 3.     The Court’s assessment (a)     Whether the alcohol in the second consignment was the second applicant company’s “possessions” (b)     Whether the destruction of the second consignement was contrary to the Convention III.     ALLEGED VIOLATION OF ARTICLE 1 OF PROTOCOL No. 1 ON ACCOUNT OF THE SEIZURE OF THE ALCOHOL IV.     ALLEGED VIOLATION OF ARTICLE 6 OF THE CONVENTION A.     The parties’ submissions B.     The Court’s assessment 1.     Scope of the case 2.     General principles 3.     Application to the present case (a)     Effects of the “special ruling” of 24 November 2000 (b)     A temporary ban on complaints under Article 125 V.     APPLICATION OF ARTICLE 41 OF THE CONVENTION A.     The parties’ submissions 1.     The applicant companies 2.     The Government B.     The Court’s assessment 1.     Pecuniary damage (a)     “Loss of business” (b)     Loss of the first consignment (c)     Loss of the second consignment 2.     Non-pecuniary damage 3.     Costs and expenses   In the case of Uniya OOO and Belcourt Trading Company v.   Russia, The European Court of Human Rights (First Article), sitting as a Chamber composed of:   Isabelle Berro-Lefèvre, President,   Elisabeth Steiner,   Khanlar Hajiyev,   Linos-Alexandre Sicilianos,   Erik Møse,   Ksenija Turković,   Dmitry Dedov, judges, and Søren Nielsen, Section Registrar, Having deliberated in private on 27 May 2014, Delivers the following judgment, which was adopted on that date: PROCEDURE 1.     The case originated in two applications (nos. 4437/03 and 13290/03) against the Russian Federation lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (“the Convention”) by two companies (“the applicant companies”). 2.     The first applicant company was Uniya OOO, a limited liability company registered in Alsheyvskiy District, Bashkortostan, under Russian law. The materials of the case indicate that this company went into liquidation during the proceedings before the Court, and no longer exists as a legal person. 3.     The second applicant company is Belcourt Trading Company, which was originally registered in the Republic of Ireland and then in the state of Delaware, USA, and subsequently in Belize City, Belize. 4.     The applications on behalf of the two applicant companies were introduced on 28 December 2002 and 17 March 2003 respectively. The first applicant company was represented before the Court by Ms   Alekseyenkova, a lawyer practising in Kaliningrad. The second was represented by Mr   Golovkin, its director, and by Mr   Rubinstein, who both live in the Kaliningrad Region, Russia. 5.     The Russian Government (“the Government”) were represented by Mr   P.   Laptev and Ms   V.   Milinchuk, former Representatives of the Russian Federation at the European Court of Human Rights, and subsequently by Mr   G. Matyushkin, the Representative of the Russian Federation at the European Court of Human Rights. 6.     The applicants alleged that their property was seized and destroyed, and that there had been no effective judicial review of the seizure and the destruction. 7.     The Chamber decided to join the proceedings in the applications (Rule   42 § 1).   By a decision of 7 October 2010, the Court declared the applications admissible. 8.     The applicant companies and the Government each submitted further written observations (Rule 59 § 1) on the merits.   The Chamber having decided, after consulting the parties, that no hearing on the merits was required (Rule 59 § 3 in fine ), the parties replied in writing to each other’s observations. THE FACTS I.     THE CIRCUMSTANCES OF THE CASE A.     The criminal case against Mr Golovkin 9 .     Between 1997 and 1998 the first applicant company (Uniya) imported several consignments of alcohol into the Kaliningrad Region under a contract with the second applicant company (Belcourt). The alcohol had been produced in Germany and Belgium. Uniya acted as a commissioner (agent) or, in some instances, as a buyer of the alcohol. The initial price of the alcohol, as sold by the producer, varied between 1.09 and 1.12 German marks per bottle. Under the contracts between the second and the first applicant company the price of the alcohol varied between about 7.25 and 7.41   United States dollars (USD) per bottle. The alcohol was declared at the border at that price. The alcohol was bottled by the producer; after customs clearance the alcohol was sold in the Kaliningrad Region under various brand names (such as Petrov-Lemon, Extra-Uniya, and Drink-Uniya) bottled in plastic and glass bottles. According to the Government, between November 1997 and April 1998 Uniya imported and sold alcohol worth USD   20,000,000. 10.     On 29 April 1998 the police instituted criminal proceedings on suspicion of unlawful trafficking in alcohol by the senior management of Uniya (no.   52012). In particular, the police suspected that Uniya had been importing the alcohol without an appropriate licence (“the criminal proceedings” or “criminal case no. 52012”), an offence under Article 171 of the Criminal Code (“illegal trading”). It appears that whereas the licence in issue was required for wholesale trading in vodka, the alcohol was declared at the border as “alcohol tincture” which did not require the licence. 11.     Within that criminal case Mr   Golovkin, the director of the Kaliningrad branch of Uniya, was charged under Article 171 of the Criminal Code. The offence imputed to Mr Golovkin was categorised by the investigator as “a crime on a particularly large scale”. The amount of damage caused to the State was calculated by the Government with reference to the price of two licences that Mr Golovkin and other managers of Uniya should have purchased: a general operating licence worth 1,544,565   Russian roubles (RUB), and a storage licence worth RUB   292,215. In addition, the Government indicated that the managers of Uniya “had received ‘uncontrolled profit’ in the amount of RUB   7,634,358 from illegal activity in the sphere of alcohol trading”. 12 .     In 1999 Mr Golovkin and several other managers of Uniya were also charged under Article 199   § 2 of the Criminal Code with corporate tax evasion. According to the Government, Mr Golovkin was suspected of “artificial under-pricing of the imported alcohol in the contracts between Uniya and Belcourt in order to reduce the amount of taxes subject to payment on the territory of the Russian Federation”. Mr   Golovkin and others were also charged with money laundering (Article 174 § 3 of the Criminal Code). 13 .     On 31   May 2005 the Baltiyskiy District Court. Kaliningrad (“the Baltiyskiy District Court”) found Mr Golovkin guilty of illegal trading. The District Court found, inter alia , that between October 1997 and May 1998 he had, in his capacity as director of the Kaliningrad branch of Uniya, imported 2,459,756 litres of various brands of alcohol worth USD   17,871,860. The District Court found that a special licence was required for such operations, which Mr   Golovkin did not have. In relation to other charges, Mr Golovkin and others were acquitted of some of the charges, and some were dropped by the prosecution. For more details concerning criminal proceedings against Mr Golovkin see the Court’s judgment in the case of Golovkin v. Russia , no. 16595/02, 3 April 2008. 14.     On 22   September 2005 the Kaliningrad Regional Court quashed the judgment of 31   May 2005 on appeal and decided to discontinue the proceedings in Mr   Golovkin’s case, on account of the expiry of the statutory time ‑ limit for finding him criminally responsible. B.     The first consignment of alcohol (337,104 bottles belonging to Belcourt and 120,317 bottles belonging to Uniya) 1.     Seizure and destruction of the first consignment (a)     Seizure 15.     Between May and October 1998 the police investigator in charge of criminal case no.   52012, Mr Zh., ordered the seizure of the alcohol imported by Uniya.   Pursuant to his order, between June and September 1998 the police seized over 450,000 one-litre bottles of liquor, stored in various warehouses (hereinafter “the first consignment”). The first consignment had undergone customs clearance and all customs duties had been paid. 16.     According to the most recent court judgments concerning those events, 120,317 bottles seized by the investigator belonged to the first applicant company (Uniya), whereas 337,104 bottles were the property of the second applicant company (Belcourt). 17.     According to the Government, the first consignment of alcohol was seized under Article 167 of the Code of Criminal Procedure. In support of that submission they produced copies of several seizure orders by the investigator Zh., dated from 19   May to 26   October 1998. It appears from these documents that the alcohol was seized on two different grounds: either for the purpose of possible confiscation of the property of the accused (Mr   Golovkin and others) or as physical evidence of a crime in the criminal proceedings against Mr   Golovkin. The seizure orders were thus formulated either as “order for attachment of property” ( постановление о наложении ареста на имущество) or “orders for removal of physical evidence” ( постановление о производстве выемки ). 18.     The “removal of physical evidence” orders referred to Article 197 of the CCrP (“Measures of identification of the person to be charged”) which apparently bore no relation to the investigator’s power to seize items or definition of “physical evidence”. 19 .     All the seizure orders contained a summary of the charges against Mr   Golovkin under Article 171 of the Criminal Code (“illegal trading”) and indicated where the alcohol in question could be found. The decisions which referred to Article 175 of the Code of Criminal Proceedings (for example, the decisions of 16 and 18 June 1998) mentioned that the attachment order had been imposed in order to secure the possible payment of civil damages and/or confiscation of property of the suspect (namely Mr   Golovkin and other managers of Uniya). Some of the seizure orders (see, for example, the “removal of physical evidence” order of 26   October 1998 and the “attachment of property” order of 19 May 1998) mentioned that the offence imputed to Mr   Golovkin and others (“illegal trading”) caused damage to the State amounting to RUB one million. In other respects the seizure orders were substantially the same. 20.     According to the applicant companies, on the basis of the “removal of physical evidence” orders the investigative authorities carried out several searches and seizures at different addresses. Thus, in toto the authorities seized 162,246 bottles under the head of “removal of physical evidence” and 295,235   bottles under the head of “attachment of property orders”. The alcohol was seized from both the applicant companies under two heads. The price of the alcohol seized varied between USD 7.31 and 7.41 per bottle. 21.     As well as seizing alcohol, the investigator carried out searches in Uniya’s offices and seized its official stamps and seals. (b)     First and second expert examinations of the quality of the alcohol 22.     On 29 June 1998 five bottles of the seized alcohol were examined in Moscow by the Central Laboratory of the State Customs Office, at the request of the investigator. The experts concluded that the content of one bottle could be characterised as “vodka” according to the State manufacturing standard for liquor (GOST 12712-80). The content of the other four bottles could be characterised as “bitter liquor” (State manufacturing standard GOST 7190-93). The experts concluded that the alcohol had been made from food-grade spirit, according to traditional processes, and was drinkable (if consumed in reasonable quantities). 23.     On 13 July 1998 the investigator commissioned another expert examination of the alcohol (hereinafter “the second expert examination”). He sent the experts ten bottles of the alcohol seized by the investigator earlier. The new examination was entrusted to the Centre of Forensic Examination of the Ministry of the Interior in Moscow. 24 .     On 14 August 1998 the second expert report was prepared. The experts found that some of the ingredients mentioned on the labels were absent from the sample bottles (such as citric acid and some flavourings as regards the bottles labelled Petrov-Lemon). The experts further found that all the alcohol’s physical and chemical characteristics corresponded to the State manufacturing standard for liquor (GOST 7190-93). However, the alcohol could not be characterised as “bitter liquor”: its examination had shown that the alcohol had been made from non-food-grade raw spirit, whereas under Russian law it was required to be produced from food ‑ grade vegetable ‑ derived raw spirit. The experts based their conclusion on the very low proportion of methanol in the alcohol examined. The experts noted that such alcohol was potentially harmful to consumers. (c)     Destruction of the alcohol 25 .     On 26   January 1999 the investigator concluded that the liquor seized was “derelict property”. According to the investigator, the first consignment had been purchased by Uniya from Belcourt. Between January and March 1998 the alcohol had “ostensibly” been returned to Belcourt. The fact of the return was confirmed by several invoices issued by Uniya, as well as by a “reciprocal debt settlement agreement” signed between Uniya and Belcourt on 18   March   1998 and discovered by the investigating authorities. The agreement had been signed on behalf of Belcourt by their agent, Mr   I. The latter had been questioned by the investigator. He had testified that he had never heard of Belcourt or any alcohol. On that ground the investigator concluded that the alcohol had no lawful owner.   On the basis of the expert report of 14 August 1998 the investigator concluded that it was “non ‑ drinkable” alcohol and was derelict property. He ordered the alcohol to be sent to a competent regional authority (hereinafter “the Alcohol Commission”) for “further disposal or processing”. 26.     On 30 April 1999 the local police department signed an agreement with a private firm, Fakel, which undertook to destroy the alcohol for RUB   29,956. 27.     On 1 June 1999 the Alcohol Commission held a meeting. According to the minutes of the meeting, the State obtained title to the alcohol received by the Commission from the investigator on 26 January 1998. The Government produced a report by the State Environment Protection Committee of the Kaliningrad Region authorising the destruction of the alcohol seized (Extra-Uniya, Drink-Uniya and Petrov-Lemon). 28.     Between 13 September and 21 October 1999 the first consignment of alcohol was allegedly destroyed. According to the official reports, it took seven days to dispose of over 460,000 one-litre bottles of alcohol by burning the alcohol or pouring it into the sewerage system. 2.     The “special ruling” of the Baltiyskiy District Court 29.     On an unspecified date during the trial of criminal case no.   52012 Mr   Golovkin requested the Baltiyskiy District Court to conduct an additional expert examination of the alcohol seized earlier by the investigator. On 16 March 2000 the court granted the request and entrusted the examination to a different group of experts. 30.     On 25 May 2000 the experts concluded that the six samples of alcohol could be characterised as “bitter liquor” and complied with the State manufacturing standards GOST 7190-93 and GOST 12712-80, and with sanitary and hygiene standard SanPiN 2.3.2.560-96. The experts contested the findings of the previous expert team that the alcohol had been made from non-food-grade spirit. The Government maintained that the new expert examination “negated the findings of the previous examinations”. 31 .     On 24 November 2000, following the acquittal of Mr Golovkin, the Baltiyskiy District Court issued a special ruling ( частное определение ) addressed to the police and the regional prosecutor’s office. In that ruling the court held that the “removal of physical evidence” had been tainted by procedural irregularities: the investigator had failed to attach the physical evidence to the materials in the criminal case, and had not decided where to store the physical evidence, as required by the Code of Criminal Procedure. Further, the investigator had unlawfully transmitted the alcohol to the regional authorities for destruction. Since the alcohol had been seized as an item of physical evidence, that is as “physical evidence of a crime”, only the trial court had the power to decide what to do with it. Moreover, when transmitting the consignment the investigator had had at his disposal an alternative expert report, which stated that the alcohol was drinkable; however, he had not even mentioned that report in his decision. The District Court finally found that the destruction of the alcohol had resulted in significant pecuniary loss for the first applicant company. The court requested the regional prosecutor to take appropriate measures in that respect. That ruling was not challenged and remained in force. 3.     Criminal investigation of the destruction of the alcohol 32.     On 31 July 2000 police investigator Ms S. opened an investigation of the destruction of the first consignment of alcohol (case no.   022155). Having examined the records of the disposal of the alcohol, she concluded that it could not have been done within seven days. According to the investigator, it would have taken 462 working days to destroy the alcohol using the method described in the official reports. Furthermore, it was unclear where all the empty bottles had gone. The investigator concluded that only 2% of the alcohol had really been destroyed; the whereabouts of the rest of the alcohol remained unknown. 33.     On 13 January 2002 the investigation was closed. Mr Ya., another police investigator, concluded that investigator Mr Zh. had acted within his powers and reasonably. Ownership of the alcohol remained unclear, since Mr   Golovkin had denied that the alcohol belonged to him or to Uniya, in order to avoid criminal responsibility. Furthermore, the examination of the alcohol of 14 August 1998 (see paragraph 24 above) showed that it had been made from non-food-grade spirit. As a result, the investigator had considered the alcohol to be “derelict property” and undrinkable, and had ordered it to be destroyed. It had been sent for disposal. It was impossible to establish how many bottles of alcohol had been destroyed, and what had happened to the empty bottles. The investigator also concluded that since the criminal proceedings against Mr Golovkin were still pending at the time, it had been impossible to establish who owned the alcohol at issue. As a result, the case had been closed. 34.     On 3 September 2002 the Leningradskiy District Court, Kaliningrad upheld the investigator’s decision of 13   January 2002. The District Court confirmed that the investigator had acted within his powers and in accordance with the applicable legislation. The Alcohol Commission had also been competent to take the decision to destroy the alcohol. 4.     Complaints by Uniya, Belcourt and Mr Golovkin under Article   125 of the CCrP (a)     Judicial review of the seizure (i)     Complaints by Uniya and Mr Golovkin (α)     First round   (Article 125 proceedings) 35.     On 17 March 2003 Mr Golovkin, referring to Article 125 of the Code of Criminal Proceedings (CCrP), lodged a complaint with the Baltiyskiy District Court, which was examining his criminal case. In that complaint Mr Golovkin sought to have the seizure of the first consignment of alcohol declared illegal. He submitted that 120,317 litres of alcohol belonged to Uniya, whereas the rest (337,104 litres) belonged to Belcourt. It is unclear whether Mr Golovkin introduced that complaint in his own name or on behalf of the first applicant company as the director of its Kaliningrad branch. 36 .     On 17 June 2003 the Baltiyskiy District Court examined the complaint and dismissed it. The court observed that the property seized did not belong to the defendant personally, and that Article 175 of the CCrP does not provide for confiscation of property as a penalty. However, “the investigation of the criminal case was still pending, and it was unclear whether any new charges or civil claims would be brought against Mr   Golovkin or against any prospective civil defendants”. The court also noted that the prosecution had lodged a civil action against Mr   Golovkin, claiming damages in the amount of RUB 6,200,566. 37.     On an unspecified date in 2003 the Baltiyskiy District Court sent a letter to Mr Golovkin, informing him that his complaint about the seizure order in the form of “removal of physical evidence” could not be examined. 38.     On 22 July 2003 the Kaliningrad Regional Court upheld the lower court’s decision of 17 June 2003. It held in particular that although the decision of 17 June 2003 only referred to “removal of physical evidence” orders, in essence it also covered “attachment of property” orders. The Regional Court held that “since the investigation in the case [was] still pending, and since the prosecutor had lodged a tort claim on behalf of the State, the [lower court] had come to the right conclusion that Mr Golovkin’s complaint should not have been allowed”. (β)     Second round (Article 125 proceedings) 39.     In 2004 Mr Golovkin, in the capacity of a representative of Uniya, renewed the complaint against the seizure orders concerning the first consignment. 40.     On 31   January 2005 the Baltiyskiy District Court refused to examine the complaint in so far as it concerned the “attachment orders”, as being essentially the same as the complaint examined on 17 June 2003. Mr   Golovkin appealed, but on 12 April 2005 the Kaliningrad Regional Court confirmed the lower court’s decision.   At the same time, the court agreed to accept the complaint in so far as it concerned the “removal of physical evidence” orders concerning the first consignment. 41.     On 20   April 2005 the Baltiyskiy District Court refused to examine the complaint by Mr Golovkin against the seizure orders of 1998 (both in the form of “attachment of property” orders and “removal of physical evidence” orders) as being essentially the same as the complaint already examined earlier and rejected on 17 June 2003 and 22 July 2003. (γ)     Chapter 25 proceedings 42 .     Following the partial acquittal of Mr Golovkin and discontinuation of the proceedings as to the remainder of the charges against him, the first applicant company lodged a complaint with the Baltiyskiy District Court. The first applicant company indicated that the courts had not ruled on the issue of the alcohol seized in the criminal proceedings, and asked the court to declare unlawful the decisions of the investigators concerning the seizure of the first consignment of alcohol. It appears that Uniya was relying on the general provisions of the Civil Procedure Code, which provided for the judicial review of an administrative action (“Chapter 25 proceedings”). 43 .     On 29 December 2005 the Baltiyskiy District Court refused to examine the complaint by Uniya. It ruled that since the seizure had been ordered in criminal proceedings a civil court had no competence to examine that issue in civil proceedings. On 8 February 2006 that decision was upheld by the Kaliningrad Regional Court. (ii)     Complaints by Belcourt (α)     First round 44.     On 19 May 2003 the second applicant company (Belcourt) lodged a complaint with the Baltiyskiy District Court, referring to Article 125 of the Code of Criminal Procedure. They sought to have the seizure of the alcohol ordered by the investigator declared illegal.   In a letter of 16   June 2003 the Baltiyskiy District Court informed the second applicant company that its complaint could not be examined, because Belcourt was not a party to the criminal proceedings and therefore had no standing to lodge such a claim. (β)     Second round 45.     In 2009 the second applicant company (Belcourt), with reference to Article   125 of the CCrP, reintroduced its complaint against the decision of the investigator of 1998 to seize alcohol belonging to it. The applicant company argued that the seizure had been unjustified and contrary to the law. 46.     On 20 October 2009 the Baltiyskiy District Court dismissed the second applicant company’s complaint on the following grounds. According to the District Court, the seizure had been ordered by a competent investigator as part of a criminal case. The seizure was ordered in accordance with the procedure established in Articles 169, 170, 171, 175 and   176 of the CCrP. The investigator had not been aware that some of the alcohol in the warehouses rented by Uniya was in fact the property of Belcourt. The search and seizure had been carried out in the presence of an employee of the warehouses. The investigator had had no obligation to contact a representative of Belcourt. 47.     The District Court further explained the difference between “removal” of items within criminal proceedings and “attachment”. The District Court considered that the “character of the imputed crimes” gave the investigator grounds to believe that both “attachment” and “removal” of the alcohol as an item of evidence could be necessary. On those grounds both “attachment of property” orders and “removal of physical evidence” orders were declared lawful by the District Court. 48.     On 1 December 2009 the Kaliningrad Regional Court confirmed the decision of 20 October 2009 in a summary manner. (b)     Judicial review of the destruction 49.     On an unspecified date in 2005 Mr Golovkin requested the Baltiyskiy District Court to exclude two items of evidence from the materials of the case file in his criminal case, namely the expert examination of 16 November 1998 and the investigator’s decision of 26 January 1999. 50.     On 14 April 2005 the Baltiyskiy District Court granted Mr   Golovkin’s request. It found that the expert examination of 16   November 1998 (see paragraph 124 below) had been tainted by serious procedural flaws, which made it unreliable. Further, the court noted that the investigator’s decision of 26   January 1999 had been based on an expert examination which had also been discarded by the court as unreliable. However, it had not been the investigator who had ordered the first consignment of alcohol to be destroyed; he had simply sent it to the Alcohol Commission, which had taken the decision to destroy it. As a result, the District Court decided to exclude the expert examination from the body of evidence and rejected the remainder of the application. 51.     Criminal proceedings against Mr Golovkin were terminated by the judgments of 31 May 2005 and 22   September 2005. Thereafter, on an unspecified date Mr Golovkin challenged the decision of the investigator of 26   January 1999, concerning the destruction of the first cargo of alcohol, in the Leningradskiy District Court. The prosecutor acknowledged in his reply that the decision at issue had been unlawful. 52 .     On 25 November 2005 the Leningradskiy District Court allowed the claim by Mr Golovkin and declared that the decision of the investigator of 26   January 1999 had been unlawful. The court found that the investigator’s conclusion that the first consignment of alcohol was “derelict property” had not been sufficiently justified. Therefore, the investigator had had no right to dispose of the property before the final resolution of the criminal case. On 17   January 2006 the Kaliningrad Regional Court upheld the decision of 25   November 2005. 5.     Tort claims by Belcourt and Uniya against the State and related proceedings (a)     Tort claims by Belcourt against the State concerning the seizure and destruction of 337,104 bottles of alcohol (i)     Proceedings before the commercial courts (α)     First round (tort claims related to the seizure and destruction) 53 .     In 2001 the second applicant company (Belcourt) lodged a civil claim with the Kaliningrad Region Commercial Court, seeking compensation for damage caused by the seizure and destruction by the authorities of 337,104 litres of alcohol allegedly belonging to Belcourt and constituting part of the first consignment. The first applicant company participated in those proceedings as a third party. 54.     On 2 April 2002 the Kaliningrad Region Commercial Court allowed Belcourt’s claims. The court held, in particular, that it would only have been licit for the State to appropriate alcohol belonging to the second applicant company pursuant to a court judgment, and not on the basis of a decision by an investigator. The investigator had failed to establish to whom the alcohol belonged. Further, the conclusions of the expert examination of 14   August 1998 had been unreliable. A fresh expert examination carried out at the request of the Baltiyskiy District Court in 2000 had completely discredited the second expert examination. Belcourt had been the lawful owner of part of the first consignment; its seizure had been unlawful and arbitrary. The declared customs value of the alcohol had been USD   7.31 per bottle. As a result, the Commercial Court ordered the defendant (the Ministry of the Interior) to pay the second applicant company RUB 76,810,056 in damages. The defendant appealed. 55 .     On 15 November 2002 the Kaliningrad Region Commercial Court, sitting as a court of appeal, quashed the lower court’s judgment. The court confirmed that 337,104 bottles of alcohol seized by the investigator and later destroyed in fact belonged to Belcourt. However, the Kaliningrad Regional Commercial Court disagreed with the calculation of damages proposed by the plaintiff, because they were based on the sale price of the alcohol and not on the purchase price. The Commercial Court further noted that the alcohol at issue was returned to Belcourt unconditionally and that it had not been under an enforceable obligation to Uniya to pay for it. The court further held that under Article 1069 of the Civil Code of the Russian Federation only damage caused unlawfully could be compensated for. However, the seizure had taken place within the framework of the criminal proceedings against Mr   Golovkin; therefore, the illegality or otherwise of that seizure could only be established in the course of those criminal proceedings, which were still pending. The “special ruling” of the Baltiyskiy District Court of 24 November 2000 was not a legitimate basis for assessing the lawfulness of the investigating authorities’ acts complained of. As a result, the appeal court dismissed the claims of the second applicant in full. 56.     On 4 March 2003 the North-West Circuit Commercial Court, sitting as a court of appeal, upheld that decision. On 17 June 2003 a panel of three judges from the Supreme Commercial Court refused to institute supervisory review proceedings, emphasising primarily that “the proceedings in the case within the framework of which the seizure of the alcohol was ordered are still pending; therefore, the courts of appeal were unable to assess the lawfulness of the acts of the investigating authorities, and were consequently unable to examine whether there was any damage requiring compensation”. (β)     Second round (tort claims related to the destruction) 57.     In 2008 the second applicant company reintroduced its tort claim before the commercial courts, now in connection with the investigator’s decision to destroy the first consignment of alcohol. 58.     The second applicant company was represented in these proceedings by Mr   Golovkin, who had been referred to in the text of the judgment as “the Director, according to the certificate confirming his status of 28.04.2008”. 59 .     On 20 May 2009 the Kaliningrad Region Commercial Court rejected the second applicant company’s tort claim. On 18 August 2009 the Thirteenth Commercial Court of Appeal upheld that judgment. The court of appeal based its conclusion on two main arguments forwarded by the lower court. First, the court of appeal noted that the alcohol at issue had not been destroyed by the investigator but by the Alcohol Commission. However, the lawfulness of the actions of the Alcohol Commission had never been challenged by the applicant company or duly established by the courts. Second, the court of appeal noted that the applicant company did not have “primary documents” confirming the price of the alcohol, and therefore had failed to substantiate its calculations of damages.   On 23 November 2009 the North ‑ West District Federal Commercial Court, sitting as a court of appeal on points of law, upheld the judgments of the courts at the first and second levels of jurisdiction. On 11 February 2010 the Supreme Commercial Court refused to initiate a supervisory review of the judgments. 60.     In 2010 the second applicant company made an unsuccessful attempt to have the proceedings before the commercial court reopened. The final decision refusing to reopen the proceedings was taken by the North ‑ West District Federal Commercial Court on 12 November 2010. (γ)     Third round (judicial review of the decision of the Alcohol Commission) 61.     In 2010 the second applicant company brought a claim before the commercial courts against the Kaliningrad Region administration. The applicant company sought to have the actions of the Alcohol Commission (destruction of alcohol on 1 June 1999) declared unlawful. 62 .     On 2 August 2010 the Kaliningrad Region Commercial Court rejected the claims of the second applicant company. The Commercial Court found that the Alcohol Commission had been acting within its powers. The Commercial Court noted in particular that: “It is clear from the decision of the Alcohol Commission that that decision was not to seize or confiscate the alcohol, but to decide on what was to be done with the alcohol which had already been seized and which was unfit for technical processing. That decision was taken on the basis of the information provided by the police and the Environmental Protection Committee. The Alcohol Commission had no authority to rule on whether the decision to seize or confiscate the alcohol had been in compliance with the law”. 63.     The Commercial Court further noted that the Alcohol Commission had been created by order of the head of the Kaliningrad Region administration and had been in the meantime abolished, again by his order. The Government of the Kaliningrad Region was not its successor; therefore, they were not liable for the decisions taken by the Alcohol Commission. 64.     The Commercial Court added that the decision of the Alcohol Commission had been in compliance with the law, and did not breach the applicant company’s rights or legitimate interests. 65.     Finally, the Commercial Court ruled that the applicant company had missed the time-limits for challenging the impugned decision. 66.     On 1   December 2010 the Thirteenth Commercial Court of Appeal confirmed the judgment of 2 August 2010. (ii)     Proceedings before the courts of general jurisdiction (α)     First round 67.     On 19 June 2008 the second applicant company lodged a tort claim against the State under Article 139 of the CCrP in connection with the actions of the investigator. They sought RUB 84,276,000 in damages. In its statement of claim the applicant company did not identify the defendant. The court decided that the State authority concerned was the Ministry of Finance, and summoned their representative to take part in the proceedings on the side of the defendant. 68.     On 22 July 2008 the Baltiyskiy District Court dismissed the claim. The court’s findings were based on several arguments. 69.     First, the court noted that it was impossible to ascertain the price of the alcohol, and consequently to calculate the amount of damages. The alcohol had been sold from the warehouses for RUB 44.50 per bottle on average. The contracts between the first and the second applicant set the price of one bottle at USD 7.25. The judgment in Mr Golovkin’s case referred to the “ de facto cost of one litre of alcohol”, which was RUB   3.78. 70.     Second, the District Court held that “unlawfulness of the actions of the investigative authorities must be established in the manner provided by the CCrP”. The District Court added that the decision to destroy the alcohol had been taken by the Alcohol Commission and not by the investigator. The District Court concluded that there had been no causal link between the actions of the investigator and the loss of the alcohol. 71.     In conclusion, the District Court held that it was impossible to consider that complaint under the provisions of Chapter 18 of the CCrP. However, in the operative part the District Court concluded that the second applicant’s company tort claim must be “rejected”. 72.     On 9 September 2008 that judgment was confirmed by the Kaliningrad Regional Court. (β)     Second round 73.     On 15 February 2010 the Presidium of the Kaliningrad Regional Court quashed the judgment of the Baltiyskiy District Court of 22   July 2008, which had been upheld on 9 September 2008, and remitted the case to the first-instance court for fresh examination.   The Presidium indicated that such claims were to be examined under Chapter 18 of the CCrP. 74.     On 7 April 2010 the Baltiyskiy District Court re-examined the second applicant company’s tort claim and rejected it on the merits. The Baltiyskiy District Court held that the seizure of the alcohol had not been declared unlawful “in the manner defined by the applicable law”. The fact that the Leningradskiy District Court had declared that the investigator’s decision to send the alcohol to the Alcohol Commission had been unlawful was irrelevant. The decision to destroy the alcohol had been taken not by the investigator but by the Alcohol Commission. The Alcohol Commission’s decision has not been challenged by the second applica