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THIRD
SECTION
CASE OF REY AND OTHERS v. SWEDEN
(Application
no. 17350/03)
JUDGMENT
STRASBOURG
20
December 2007
This
judgment will become final in the circumstances set out in Article 44
§ 2 of the Convention. It may be subject to editorial
revision.
In the case of Rey and Others v. Sweden,
The
European Court of Human Rights (Third Section), sitting as a Chamber
composed of:
Mr B.M. Zupančič,
President,
Mr C. Bîrsan,
Mrs E.
Fura-Sandström,
Mrs A. Gyulumyan,
Mr E.
Myjer,
Mr David Thór Björgvinsson,
Mrs I.
Ziemele, judges,
and Mr S. Quesada, Section Registrar,
Having
deliberated in private on 29 November 2007,
Delivers
the following judgment, which was adopted on that date:
PROCEDURE
- The
case originated in an application
(no. 17350/03) against the
Kingdom of Sweden lodged with the Court
under Article 34 of the Convention for the Protection
of Human Rights and Fundamental Freedoms (“the Convention”)
by two Swedish nationals, Mr Lars Rey and Ms Inger Rey, and a Swedish
company, Pulverbränsle Summa AB (“the applicants”),
on 26 May 2003.
- The
applicants were represented by Mr J. Thörnhammar, a lawyer
practising in Stockholm. The Swedish Government (“the
Government”) were represented by their Agent, Ms I. Kalmerborn,
Ministry for Foreign Affairs.
- On
26 September 2006 the
Court declared the application partly inadmissible and decided to
communicate the complaint concerning the length of the proceedings to
the Government. Applying Article 29 § 3 of the Convention, it
decided to rule on the admissibility and merits of the application at
the same time.
THE FACTS
THE CIRCUMSTANCES OF THE CASE
- The
first two applicants, a married couple, were born in 1935 and 1944
respectively and live in Klippan. The third applicant was a limited
liability company wholly owned by the first two applicants.
- On
28 October 1992 the company concluded a contract with a municipal
energy company, Drefviken Energi AB, concerning deliveries of
wood-powder fuel.
- On
3 December 1992 a bank, Skandinaviska Enskilda Banken, and two other
investors granted the company loans to construct a plant for the
production of wood-powder fuel. The bank's loan, amounting to 5.8
million Swedish kronor (SEK), was to be paid in instalments. In
December 1992 and January 1993, 3.8 million SEK of the loan was paid
to the company.
- In
March 1993, at a first testing of the completed plant, it was
discovered that certain modifications had to be made. In March and
April, the company therefore requested the bank to pay the remaining
2 million SEK of the loan. However, the bank refused to do so.
- In
April 1993, Drefviken Energy AB cancelled the fuel delivery contract,
apparently due to the fact that the company had not concluded the
construction of the plant and it was therefore very doubtful whether
it would be able to deliver the agreed amounts of fuel for the
1993/94 season.
- Subsequently,
the company tried to find other customers and reiterated its request
to the bank to receive the remainder of the loan. It was paid to the
company on 28 June 1993.
- The
bank's payment, together with an additional loan from another
investor, enabled the company to uphold a limited production capacity
for a time. However, on 7 September 1994 it was declared bankrupt.
- The
bank instituted proceedings against the first and second applicants,
claiming their joint liability for 1.1 million SEK of the company's
loan in accordance with the personal guarantees they had signed. On
24 February 1995, in a different action, the applicants and a company
named Boket Konsult AB (hereinafter “Boket”) claimed
compensation from the bank in the amount of 37 million SEK for the
damage allegedly caused by the bank's initial refusal to pay the last
instalment of the loan. They claimed that that refusal had violated
the terms of the loan contract and, in any event, that the bank had
incurred liability for damages due to negligence, since the project
in question had depended on the loan being paid out on demand.
- On
3 October 1995 the Supreme Court (Högsta domstolen)
ordered that the proceedings should be examined jointly by the
District Court (tingsrätten) of Stockholm.
- Throughout
the subsequent proceedings, the parties lodged several supplementary
arguments and procedural requests and submitted documentary evidence
to the court. The parties asked for and were granted extensions of
the time-limits set by the court on several occasions. It further
appears that the judge in charge of the proceedings was replaced on
several occasions.
- An
oral preparation with the parties was held by the District Court on
18 September 1995. By a decision of 10 June 1996, the court rejected
the bank's request for the applicant company's and Boket's action to
be dismissed due to lack of standing. A further oral preparation,
scheduled for 16 December 1996, was cancelled due to the illness of
the applicants' and Boket's counsel. In February 1997, the applicants
and Boket asked the court to rule on the alleged breach of contract
in a partial judgment. An oral preparation was held on 7 April 1998.
On 29 September 1998 the court sent a summary of the cases to the
parties and, by a decision of 30 September 1998, it rejected the
request for a partial judgment. On 14 December 1998 the applicants
and Boket requested that the court order the bank to produce the
files concerning the loan. On 29 June 1999 the court granted this
request, and on 23 July 1999 the bank produced the loan files. On
17 January 2000 Boket's action was struck out of the court's
list. On 5 July 2000 the court delivered another summary of the cases
and gave the parties the opportunity to make comments, which they did
in September 2000. On 26 and 27 March and 2 April 2001 an oral
hearing was held.
- By
a judgment of 27 April 2001, the District Court found in favour of
the bank. It noted that 2 million SEK of the bank loan had been
pledged by the company at the time when the loan contract had been
concluded through the deposit of that amount on a blocked bank
account. It found that, in the absence of any other clauses or
agreements with regard to the bank loan or the pledge, this measure
showed that the amount, like any other pledge, was only available for
withdrawal if so approved by the bank. Consequently, the bank had not
breached the loan contract by its initial refusal to pay the amount
in question. Moreover, on account of the difficulties related to the
company's fuel production, the bank had had good reasons to be
cautious and not make available the disputed amount earlier than July
1993, the date originally projected. The bank could not therefore be
held liable for negligence towards the company.
- The
applicants appealed to the Svea Court of Appeal (Svea hovrätt).
On 5 February 2002, following a hearing, the appellate court agreed
with the District Court's reasoning and upheld its judgment. On 29
November 2002, after the applicants had been granted several respites
to complete their submissions, the Supreme Court refused the
applicants leave to appeal.
THE LAW
I. ALLEGED VIOLATION OF ARTICLE 6 § 1 OF THE
CONVENTION
- The
applicants complained that the length of the proceedings had been
incompatible with the “reasonable time” requirement, laid
down in Article 6 § 1 of the Convention, which reads as follows:
“In the determination of his civil rights and
obligations ..., everyone is entitled to a ... hearing within a
reasonable time by [a] ... tribunal...”
- The
Government contested that argument.
- The
period to be taken into consideration began on 24 February 1995 and
ended on 29 November 2002. It thus lasted approximately seven years
and nine months for three levels of jurisdiction.
A. Admissibility
- The
Court notes that the complaint is not manifestly ill-founded within
the meaning of Article 35 § 3 of the Convention. It further
considers that it is not inadmissible on any other grounds. It must
therefore be declared admissible.
B. Merits
- The
applicants stated that, while they directed no criticism against the
time spent by the Court of Appeal and the Supreme Court, the period
of approximately six years and two months before the District Court
was unreasonable and caused mainly by numerous changes of the
responsible judge and the court's inability or unwillingness to speed
up the proceedings in the face of the bank's repeated attempts to
delay them. They maintained that the case was not complex.
- The
Government asserted that the case was rather complex, both from a
legal point of view and due to the fact that the parties initiated
altogether four actions against each other which were examined
jointly and that they submitted extensive written material and made
many procedural motions. In regard to the proceedings before the
District Court, the Government maintained that, with a few
exceptions, there were continuous activities in the handling of the
case. The court had to decide on the procedural motions and the
proceedings were delayed due to events which were mainly attributable
to the applicants, including two orders for them to specify their
claims, a change of legal counsel and several extensions of
time-limits.
- The
Court reiterates that the reasonableness of the length of proceedings
must be assessed in the light of the circumstances of the case and
with reference to the following criteria: the complexity of the case,
the conduct of the applicants and the relevant authorities and what
was at stake for the applicants in the dispute (see, among many other
authorities, Frydlender v. France [GC], no. 30979/96, §
43, ECHR 2000-VII).
- The
present case came before three levels of jurisdiction. It was dealt
with speedily by the courts of second and third instance. However,
the proceedings were pending before the District Court between 24
February 1995 and 27 April 2001. It is true, as asserted by the
Government, that the parties made extensive submissions and
procedural motions in the case and that the applicants, on several
occasions, requested and were granted extensions of the time-limits
set by the court. As a consequence, the case gained some complexity,
although the subject-matter does not appear to have been particularly
complex. Moreover, some of the delays were clearly attributable to
the parties. Nevertheless, it was the responsibility of the Court to
see to it that the proceedings were conducted expeditiously, if
necessary by refusing further extensions of time-limits and ordering
the parties to make their final submissions. The fact that the case
was pending before the District Court for more than six years
indicates that the proceedings were not sufficiently expeditious.
- In
these circumstances, and taking into account the overall duration of
the proceedings and the criteria laid down in its case-law, the Court
considers that the length of the proceedings in the instant case was
excessive and failed to meet the “reasonable time”
requirement.
There
has accordingly been a breach of Article 6 § 1.
II. APPLICATION OF ARTICLE 41 OF THE CONVENTION
- Article
41 of the Convention provides:
“If the Court finds that there has been a
violation of the Convention or the Protocols thereto, and if the
internal law of the High Contracting Party concerned allows only
partial reparation to be made, the Court shall, if necessary, afford
just satisfaction to the injured party.”
A. Damage
- The
applicants claimed 8000 euros (EUR) each in respect of non-pecuniary
damage.
- The
Government maintained that any compensation for non-pecuniary damage
should not exceed a total of EUR 4000.
- The
Court considers that the applicants must have sustained non-pecuniary
damage. Ruling on an equitable basis, it awards award them EUR 4000
jointly under that head.
B. Costs and expenses
- The
applicants claimed compensation for costs, but they did not quantify
their claim or submit any documents in this respect.
- The
Government did not express an opinion on the matter.
- As
the applicants did not submit a quantified claim for costs and
expenses within the fixed time-limit, the Court considers that there
is no call to award any sum on that account.
C. Default interest
- The
Court considers it appropriate that the default interest should be
based on the marginal lending rate of the European Central Bank, to
which should be added three percentage points.
FOR THESE REASONS, THE COURT UNANIMOUSLY
- Declares the remainder of the application
admissible;
- Holds that there has been a violation of Article
6 § 1 of the Convention;
- Holds
(a) that
the respondent State is to pay the applicants jointly, within three
months from the date on which the judgment becomes final in
accordance with Article 44 § 2 of the Convention, EUR 4000 (four
thousand euros) in respect of non-pecuniary damage, plus any tax that
may be chargeable, to be converted into Swedish kronor at the rate
applicable at the date of settlement;
(b) that
from the expiry of the above-mentioned three months until settlement
simple interest shall be payable on the above amount at a rate equal
to the marginal lending rate of the European Central Bank during the
default period plus three percentage points;
- Dismisses the remainder of the applicants' claim
for just satisfaction.
Done in English, and notified in writing on 20 December 2007,
pursuant to Rule 77 §§ 2 and 3 of the Rules of Court.
Santiago Quesada Boštjan M. Zupančič
Registrar President
