CEDH · CASELAW;CLIN;ENG — 14 janvier 2010

.s3ABFC313 { font-size:10pt } .sD4B5322E { margin-top:12pt; margin-bottom:12pt; text-align:justify } .sBB9EE52A { font-family:Arial } .sA241FE93 { margin-top:0pt; margin-bottom:18pt; text-align:justify; page-break-after:avoid; border-bottom:0.75pt solid #000000; padding-bottom:1pt } .s2EF62ED2 { margin-top:0pt; margin-bottom:0pt; font-size:12pt } .s4DDA3AA3 { font-family:Arial; font-weight:bold; font-style:italic } .s29100277 { font-family:Arial; font-weight:bold } .s32563E28 { margin-top:0pt; margin-bottom:0pt } .s8F2B0B1B { margin-top:12pt; margin-bottom:12pt; page-break-after:avoid; font-size:12pt } .s9FF10068 { margin-top:0pt; margin-bottom:12pt } .sEB86A30B { margin-top:0pt; margin-bottom:14pt; page-break-after:avoid } .sA36B60A1 { font-family:Arial; font-style:italic } .s5F48796F { margin-top:12pt; margin-bottom:0pt; text-align:justify } .s8B6C6D43 { margin-top:0pt; margin-bottom:0pt; border-bottom:1pt solid #000000; padding-bottom:1pt } .sDF790F1E { margin-top:12pt; margin-bottom:0pt; text-align:center } .s7ED160F0 { text-decoration:none } .s3DC36BA9 { font-family:Arial; text-decoration:underline; color:#0069d6 } Information Note on the Court’s case-law No. 126 January 2010 Kotov v. Russia - 54522/00 Judgment 14.1.2010 [Section I] Article 1 of Protocol No. 1 Article 1 para. 1 of Protocol No. 1 Deprivation of property Unlawful distribution of assets of private bank by liquidator: violation [This case was referred to the Grand Chamber on 28 June 2010] Facts – The applicant had a savings account with a private bank which went into liquidation. As a deposit-holder he was regarded under domestic law as a priority creditor and therefore entitled to be paid a share of the assets proportionate to the amount owed to him, together with the other priority creditors and ahead of the next-ranking category. However, in line with a decision of the creditors’ committee, the liquidator gave priority to certain categories of persons not mentioned in the legislation (disabled persons, war veterans, the needy and persons who had participated actively in the winding-up operation). As a result, the applicant received only a tiny proportion of the amount owed to him, while 700   persons belonging to these other categories obtained full reimbursement. The courts subsequently found a breach of the law and directed the liquidator to remedy the situation. The decision remained unenforced, however, as the bank had no remaining assets. In a new round of proceedings, the applicant applied unsuccessfully for an order requiring the liquidator to pay the sum due to him out of his own funds. Law – Article 1 of Protocol No.   1: The Court accepted that the State could not be held liable for the obligations of a private institution which was unable to honour its debts following its collapse. However, it had to ascertain whether and to what extent the State’s responsibility could be engaged on account of the acts or omissions of the liquidator. On the first point the Court took the view that the liquidator could be considered as a representative of the State, particularly in view of his legal status. Liquidators were appointed by the courts to conduct insolvency proceedings under the latter’s supervision. They exercised public authority and were tasked with striking a “fair balance” between the demands of the general interest and protection of the individual’s fundamental rights. Their actions were therefore capable of engaging the responsibility of the State. On the second point the Court observed that the bank’s assets would have been sufficient to meet a substantial proportion of the applicant’s claim had the liquidator treated him as a priority creditor in accordance with the law. The applicant’s permanent inability to obtain effective repayment of the sum owed to him had stemmed directly from the abuse of authority committed by the liquidator in distributing the bank’s assets unlawfully. Not only had there been a breach of the applicant’s rights as a priority creditor but, in addition, there had been no legal basis in domestic law for the categories of creditors who had received repayment in full. Hence, since the applicant had been unable to secure payment of the amount owed to him in accordance with the legal principle of proportionality, as ordered by the domestic courts, while creditors in categories not even provided for by the law had been paid in full, the Court took the view that he had been deprived of his property unlawfully, in a manner incompatible with his right to the peaceful enjoyment of his possessions. Conclusion : violation (unanimously). Article 41: no award.   © Council of Europe/European Court of Human Rights This summary by the Registry does not bind the Court. Click here for the Case-Law Information Notes