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FIFTH
SECTION
CASE OF PENEV v. BULGARIA
(Application
no. 20494/04)
JUDGMENT
STRASBOURG
7
January 2010
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 Penev v. Bulgaria,
The
European Court of Human Rights (Fifth Section), sitting as a Chamber
composed of:
Peer Lorenzen, President,
Renate
Jaeger,
Karel Jungwiert,
Rait Maruste,
Mark
Villiger,
Isabelle Berro-Lefèvre,
judges,
Pavlina Panova, ad hoc judge,
and
Claudia Westerdiek,
Section Registrar,
Having
deliberated in private on 1 December 2009,
Delivers
the following judgment, which was adopted on that date:
PROCEDURE
- The
case originated in an application (no. 20494/04) against the Republic
of Bulgaria lodged with the Court under Article 34 of the Convention
for the Protection of Human Rights and Fundamental Freedoms (“the
Convention”) by a Bulgarian national, Mr Nikolay Anatoliev
Penev (“the applicant”), on 8 June 2004.
- The
applicant was represented by Mrs Z. Stefanova, a lawyer practising in
Sofia. The Bulgarian Government (“the Government”) were
represented by their Agent, Mrs N. Nikolova, of the Ministry of
Justice.
- The
applicant alleged that he had not had the opportunity to defend
himself against the charge he had been convicted of.
- On
6 May 2008 the President of the Fifth Section decided to give notice
of the application to the Government. It was also decided to examine
the merits of the application at the same time as its admissibility
(Article 29 § 3).
- Mrs
Zdravka Kalaydjieva, the judge elected in respect of Bulgaria,
withdrew from sitting in the case. On 30 January 2009 the Government
appointed in her stead Mrs Pavlina Panova as an ad hoc judge (Article
27 § 2 of the Convention and Rule 29 § 1 of the Rules
of the Court).
THE FACTS
I. THE CIRCUMSTANCES OF THE CASE
- The
applicant was born in 1946 and lives in Sofia.
A. Activity of the applicant as trustee in insolvency
of Plama
- In
July 1998 the Plama oil refinery, a joint stock company with its main
office in Pleven (“Plama” or “the company”),
was declared insolvent. On 18 May 1999 the applicant was appointed
its trustee in insolvency.
- On
21 May 1999 Mrs L.T., a former trustee of Plama, lodged a statement
of claim on behalf of the company in the Pleven Regional Court.
- On
22 June 1999 the Pleven Regional Court advised the applicant to
specify whether he would confirm this action. The applicant decided
to retain a lawyer, Mr Y.N. On 5 July 1999 he obtained the
authorisation of the insolvency court to pay Mr Y.N. a fee of 150,000
Bulgarian levs (BGN), the equivalent of approximately 76,900 euros
(EUR), for Plama’s legal representation in the proceedings.
- On
7 July 1999 Mr Y.N. attended a court hearing and requested in writing
that the proceedings be terminated, since the action had been brought
by Mrs L.T., who did not represent Plama at the time. Upon request by
the defendant, the case was transferred to the Sofia City Court where
the proceedings were subsequently terminated.
- Meanwhile,
the creditors of Plama agreed upon a plan for the company’s
recovery. On 8 July 1999 the plan was approved by the insolvency
court and the applicant’s functions as trustee in insolvency
were terminated. However, he retained some supervisory functions.
- On
15 July 1999 the applicant signed two orders for the transfer of
BGN 150,000 to Mr Y.N.’s bank account.
B. Indictment of the applicant and judgment of the
Pleven District Court
- Later
in 1999 an investigation was opened in relation to the applicant’s
actions. On 7 June 2001 the prosecution filed an indictment against
him. He was indicted with exceeding his powers (Article 282 § 2
of the Criminal Code, see paragraphs 24 and 26 below) in that, acting
as an official with whom powers were vested by virtue of law
(длъжностно
лице), he had retained a lawyer to
represent the company before obtaining the insolvency court’s
authorisation to pay the fee agreed upon, and that on 15 July 1999 he
had ordered that the sum of BGN 150,000 be paid to Mr Y.N., even
though by that time he had ceased to act as a trustee in insolvency
of the company and was no longer authorised to act for it.
- On
an unspecified date Plama was constituted as a civil party in the
criminal proceedings against the applicant and brought an action for
damages in the amount of BGN 150,000.
- On
5 December 2001 the Pleven District Court convicted the applicant as
charged, sentenced him to four years’ imprisonment and allowed
in full Plama’s civil claim.
C. Judgment of the Pleven Regional Court
- The
applicant lodged an appeal against the judgment of the Pleven
District Court.
- On
18 December 2002 the verdict was upheld by the Pleven Regional Court,
which dismissed an objection by the applicant that he had not had an
official capacity (длъжностно
лице). It held that it was
sufficient that as a trustee he had assumed managerial functions and
responsibility for the company’s assets.
- On
the first charge against the applicant, that he had exceeded his
powers in retaining a lawyer to represent the company, the Regional
Court found that it had certainly not been necessary to retain a
lawyer, provided that the only thing the latter had done had been to
request the termination of the proceedings. Thus, the applicant had
indebted the company with the lawyer’s fee whereas it had not
received any gain in return. The applicant had not therefore acted in
accordance with the rights and powers vested in him as a trustee but
with the aim of enriching Mr Y.N. and inflicting a financial loss on
Plama.
- Similarly,
the Regional Court found that the applicant had exceeded his powers
in ordering the payment of Mr Y.N.’s fees.
D. Judgment of the Supreme Court of Cassation
- The
applicant appealed in cassation. He argued that he had not acted as
an official and that, therefore, he could not have committed an
offence under Article 282 of the Criminal Code. He argued,
furthermore, that he had acted in accordance with the law and had not
unnecessarily indebted Plama.
- The
Supreme Court of Cassation delivered a judgment on 10 December
2003. It confirmed the lower courts’ conclusion that the
applicant had had an official capacity. However, it held that in
retaining a lawyer and ordering the payment of the legal fees he had
not exceeded his powers as a trustee. Retaining a lawyer had been
within his powers and, as he had continued to exercise supervisory
functions after the adoption of the plan for Plama’s recovery,
he had had the power to order the payment. Furthermore, Article 282
of the Criminal Code concerned offences against the proper exercise
of State power, whereas it had been alleged that the applicant had
acted against the interests of a private company. It followed that he
could not have committed an offence under Article 282 of the Criminal
Code. Therefore, on the charges of having exceeded his powers, the
Supreme Court of Cassation acquitted the applicant.
- Nevertheless,
the Supreme Court of Cassation found that as the applicant had
deliberately entered into a contract which was disadvantageous to the
company he was guilty of an offence under Article 220 § 1
of the Criminal Code (see paragraph 25 below). In the domestic
court’s view, returning such an alternative verdict was
procedurally lawful, per argumentum a contrario, under
Article 285 § 1 of the Code of Criminal Procedure, since it was
based on the circumstances underlying the initial charges and the
applicant had defended himself in respect of those circumstances
throughout the proceedings. Only the legal characterisation of the
facts had changed.
- Accordingly,
the Supreme Court of Cassation convicted the applicant of
deliberately entering into a disadvantageous contract and thus
inflicting substantial damage on Plama, and sentenced him to a
suspended term of one year’s imprisonment. It affirmed the
lower courts’ judgments in the part allowing Plama’s
civil claim. That judgment was final.
II. RELEVANT DOMESTIC LAW
A. Criminal Code 1968
- Article
282 § 1 of the Criminal Code, as in force at the relevant time,
provided that an official in whom certain powers were vested by
virtue of law (длъжностно
лице), who breached or failed to
fulfil his duties, or exceeded his power, with the aim of obtaining a
benefit for himself or a third party, or of causing damage to others,
was to be punished by up to five years’ imprisonment or
correctional labour. Article 282 § 2 envisaged imprisonment of
up to eight years where considerable material damage had resulted
from these acts or the offender had occupied a senior managerial
post.
- Under
Article 220 § 1 of the Criminal Code, an official in whom
certain powers are vested by virtue of law
(длъжностно
лице),
who deliberately enters into a disadvantageous contract which can
result in substantial damage to the company or organisation he
represents, is to be punished by imprisonment of up to five years.
- In
accordance with the structure of the Criminal Code of 1968, Article
282 was at the relevant time classified as an offence against the
functioning of State bodies and public organisations, while Article
220 was considered an offence against the economy.
B. Code of Criminal Procedure 1974
- Article
285 § 1 of the Code of Criminal Procedure 1974, in force until
April 2006, required that the prosecution file a new indictment in
cases where, at the trial stage of the proceedings, it transpired
that there were grounds to substantially amend the factual basis of
the charges, or to bring charges which required a more severe
punishment. Under Article 285 § 3, in cases where a new
indictment was necessary and the parties had so requested, the
domestic court had to adjourn the hearing for further argument.
- Identical
provisions are contained in Article 287 §§ 1 and 3 of the
new Code of Criminal Procedure, in force from April 2006.
THE LAW
I. ALLEGED VIOLATION OF ARTICLE 6 §§ 1 AND 3 (a)
AND (b) OF THE CONVENTION
- The
applicant complained that he had not been given the opportunity to
defend himself against the charge under Article 220 of the Criminal
Code, after the Supreme Court of Cassation adopted a new legal
characterisation of the facts of the case. He relied on Article 6 §§
1 and 3 (a) and (b) of the Convention, which read as follows:
“1. In the determination of ... any
criminal charge against him, everyone is entitled to a fair ...
hearing ... by [a] ... tribunal
...
3. Everyone charged with a criminal offence
has the following minimum rights:
(a) to be informed promptly, in a language
which he understands and in detail, of the nature and cause of the
accusation against him;
(b) to have adequate time and facilities for
the preparation of his defence;
...”
- The
Government argued that the Supreme Court of Cassation had correctly
interpreted the relevant facts. In their view, the exact legal
characterisation of the offence the applicant had been convicted of
was of little importance, as long as the factual basis of the
conviction remained unchanged.
- The
applicant contested these arguments
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
notes that it is not inadmissible on any other grounds. It must
therefore be declared admissible.
B. Merits
- The
Court reiterates that Article 6 § 3 (a) of the Convention
affords the defendant the right to be informed, in detail, not only
of the cause of the accusation, that is to say the acts he is alleged
to have committed and on which the accusation is based, but also the
legal characterisation given to those acts (see Pélissier
and Sassi v. France [GC], no. 25444/94, § 51, ECHR 1999 II,
and Drassich v. Italy, no. 25575/04, § 34, 11 December
2007). Article 6 § 3 (a) does not impose any special formal
requirement as to the manner in which the accused is to be informed
of the nature and cause of the accusation against him (see Pélissier
and Sassi, cited above, § 53).
- The
scope of the above provision must be assessed in the light of the
more general right to a fair hearing guaranteed by Article 6 § 1
of the Convention. The Court has held that in criminal matters the
provision of full, detailed information concerning the charges
against a defendant, and consequently the legal characterisation that
the domestic courts might adopt in the matter, is an essential
prerequisite for ensuring that the proceedings are fair (see ibid., §
52).
- Furthermore,
as regards the complaint under Article 6 § 3 (b) of the
Convention, the Court considers that sub-paragraphs (a) and (b) of
Article 6 § 3 are connected and that the right to be informed of
the nature and the cause of the accusation must be considered in the
light of the accused’s right to prepare his defence.
- The
Court will therefore examine the present complaint under
sub paragraphs (a) and (b) of Article 6 § 3 of the
Convention, taken together with paragraph 1 of that Article, which
provides for a fair trial.
- The
Court notes that the applicant was indicted under Article 282 §
2 of the Criminal Code of having exceeded his powers (see paragraph
13 above). There is nothing to suggest that a charge of deliberately
entering into a disadvantageous contract (Article 220 § 1 of the
Criminal Code) was considered at any time during the investigation.
- There
is likewise no indication that the Pleven District Court and the
Pleven Regional Court considered a charge against the applicant under
Article 220 § 1 of the Criminal Code.
- In
the Court’s view, therefore, the applicant could not have been
aware that the Supreme Court of Cassation might return an alternative
verdict under Article 220 § 1 of the Criminal Code.
- The
Court observes that under Bulgarian law the offences of acting in
excess of power (Article 282 § 2 of the Criminal Code,
see paragraph 24 above) and of deliberately entering into a
disadvantageous contract (Article 220 § 1 of the Code, see
paragraph 25 above) are different. In
particular, under Article 282 § 2 the prosecution has to prove
that the accused (1) breached or failed to fulfil his duties, or
exceeded his powers, and (2) acted with the aim of obtaining a
benefit for himself or a third party, or of causing damage to others
(see paragraph 24 above). Under Article 220 § 1, on the other
hand, the prosecution has to show that the accused (1) acted
deliberately and (2) entered into a disadvantageous contract which
could result in substantial damage to the company or organisation
(see paragraph 25 above).
- The
Court observes further that the elements of the latter offence were
never debated throughout the applicant’s trial as it was only
through the final judgment of the Supreme Court of Cassation that he
became aware of the new legal characterisation of the facts.
- The
Court does not accept the Government’s contention (see
paragraph 29 above) that the legal characterisation of the offence
was of little importance as long as the alternative conviction was
based on the same facts. It reiterates that the Convention requires
that the accused be informed in detail not only of the acts he is
alleged to have committed, that is, of the facts underlying the
charges, but also of the legal characterisation given to them (see
paragraph 32 above).
- The
Court is therefore of the view that the Supreme Court of Cassation
should have given the applicant an opportunity to defend himself
against the new charge. It could, for example, adjourn the hearing
for further argument, or, alternatively, allow the applicant the
opportunity to make written submissions on the new charge. However,
it did none of these, as it was not obliged to, since Article 285 §
3 of the Code of Criminal Procedure 1974 (see paragraph 27 above)
only required the adjournment of the proceedings in cases of
substantial modification of the factual basis of the charges, or of
new charges carrying a more severe punishment.
- In
the light of these considerations the Court concludes that the
applicant was not informed in detail of the nature and the cause of
the accusation against him, that he was not afforded adequate time
and facilities for the preparation of his defence, and that he did
not receive a fair trial. The absence of a clear requirement in the
applicable law to allow the accused to defend himself against the
modified charges was undoubtedly decisive in that aspect.
- Consequently,
there has been a violation of paragraph 3 (a) and (b) of Article 6 of
the Convention, taken together with paragraph 1 of that Article.
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
applicant claimed EUR 80,000 in compensation for non pecuniary
damage.
- The
Government did not comment on the matter.
- The
Court, ruling on an equitable basis, awards the applicant EUR 2,000
in respect of non-pecuniary damage.
B. Costs and expenses
- The
applicant claimed EUR 2,000 for fees charged by his lawyers for the
proceedings before the Court. In support of this claim, he submitted
a contract for legal representation by Mrs Z. Stefanova and a
declaration signed by him in respect of the fees charged by the
lawyer who had prepared his initial application to the Court.
- The
applicant also claimed EUR 110 for expenses for translation and
postage. He submitted receipts for part of this sum.
- The
Government did not comment.
- According
to the Court’s case-law, an applicant is entitled to the
reimbursement of costs and expenses only in so far as it has been
shown that these have been actually and necessarily incurred and are
reasonable as to quantum.
- In
the present case, regard being had to the information in its
possession and the above criteria, the Court considers it reasonable
to award the sum of EUR 2,000 covering costs and expenses under all
heads.
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 application admissible;
- Holds that there has been a violation of Article
6 § 3 (a) and (b), taken together with Article 6 § 1 of the
Convention, in that the applicant was not informed in detail of the
nature and cause of the accusation against him, was not afforded
adequate time and facilities for the preparation of his defence and
did not receive a fair trial;
- Holds
(a) that
the respondent State is to pay the applicant, within three months
from the date on which the judgment becomes final in accordance with
Article 44 § 2 of the Convention, the following
amounts, to be converted into Bulgarian levs at the rate applicable
at the date of settlement:
(i)
EUR 2,000 (two thousand euros), plus any tax that may be chargeable,
in respect of pecuniary and non-pecuniary damage;
(ii)
EUR 2,000 (two thousand euros), plus any tax that may be chargeable
to the applicant, in respect of costs and expenses;
(b) that
from the expiry of the above-mentioned three months until settlement
simple interest shall be payable on the above amounts 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 applicant’s
claims for just satisfaction.
Done in English, and notified in writing on 7 January 2010, pursuant
to Rule 77 §§ 2 and 3 of the Rules of Court.
Claudia Westerdiek Peer Lorenzen
Registrar President
