Lexploria

AS TO THE ADMISSIBILITY OF

Application No. 30633/96

by DALLMANN, HÜGEL, LAURER & VIEHBÖCK OEG

against Austria

The European Commission of Human Rights (First Chamber) sitting

in private on 26 February 1997, the following members being present:

Mrs. J. LIDDY, President

MM. E. BUSUTTIL

A. WEITZEL

C.L. ROZAKIS

L. LOUCAIDES

B. MARXER

B. CONFORTI

N. BRATZA

I. BÉKÉS

G. RESS

A. PERENIC

C. BÎRSAN

K. HERNDL

M. VILA AMIGÓ

Mrs. M. HION

Mr. R. NICOLINI

Mrs. M.F. BUQUICCHIO, Secretary to the Chamber

Having regard to Article 25 of the Convention for the Protection

of Human Rights and Fundamental Freedoms;

Having regard to the application introduced on 7 March 1996 by

DALLMANN, HÜGEL, LAURER & VIEHBÖCK OEG against Austria and registered

on 26 March 1996 under file No. 30633/96;

Having regard to the report provided for in Rule 47 of the Rules

of Procedure of the Commission;

Having deliberated;

Decides as follows:

THE FACTS

The applicant company ("the company") is a registered company

under the Law on Registered Companies of 25 May 1990 (Bundesgesetz vom

25 April 1990 über eingetragene Erwerbsgesellschaften, BGBl. 1990/257).

It has its registered office in Mödling, and is represented before the

Commission by Professor H.F. Hügel, who practices as a lawyer in

Mödling.

On 3 February 1993, the company applied to the respective Bar

Associations for inclusion in the list of law firms

(Rechtsanwaltsgesellchaften) in both Lower Austria and Vienna. In each

case, the company declared that it had offices (Kanzleisitze) in Vienna

and Mödling.

The application to the Lower Austrian Bar Association was refused

on 18 February 1993. The Bar Association rejected the application to

the extent that it concerned the Vienna offices, on the ground that the

Vienna Bar Association was responsible for offices in Vienna.

The application was dismissed so far as it related to the Mödling

offices on the ground that the Section 21c (7) of the Lawyers Act

(Rechtsanwaltsordnung) provided that "The firm may have only one

office". Moreover, Rule 25 of the Guidelines for the Exercise of the

Profession of Lawyer (Richtlinien für die Ausübung des

Rechtsanwaltsberufes) provided that only lawyers with the same offices

may practice together.

The Bar Association added that the company's application ran

counter to the aims of the above provisions: two sets of offices was

incompatible with the federal organisation of Bar Associations, the

economic structuring of lawyers' practices, and the "essence of a free

profession". Further, marriages between giants ("Elefantenhochzeiten")

and legal clinics were undesirable.

The company's appeal to the Supreme Appeals and Disciplinary

Board (Oberste Berufungs- und Disziplinarkommission) was dismissed on

21 July 1993. The Board confirmed the Bar Association's decision of

18 February 1993.

The company made a constitutional complaint to the Constitutional

Court (Verfassungsgerichtshof).

On 27 September 1994 the Constitutional Court found that Rule 25

of the Guidelines was not authorised by any provision of the Lawyers

Act, and quashed the decision of 21 July 1993 on the ground that an

unlawful rule had been applied.

In its new decision of 21 November 1994, the Supreme Appeals and

Disciplinary Board again dismissed the company's appeal, this time

without relying on the Guidelines, but solely on the provisions which

stated that a law firm may only have one office.

The company made a further constitutional complaint. It argued

that there had been violation of its constitutional right to the free

exercise of its trade (Erwerbsausübungsfreiheit) in that there were no

public interests which could justify the interference with the right

of lawyers to practice, simply because they had two offices. It also

alleged a violation of its right to equality before the law, as

foreignlawyers were permitted, by the European Communities Treaties,

to establish in Austria, and they were therefore better treated than

domestic law firms.

The Constitutional Court, finding no violation of the company's

rights, dismissed the complaint on 30 June 1995 (received on

15 September 1995). It recalled that it had accepted, in an earlier

decision, that the prohibition of branch offices was objectively

justified. The legislator had obviously considered that the exercise

of the profession of lawyer depended on the direct personal

relationship between the lawyer and his client, and the confidence

which ensues therefrom. As the prohibition on multiple offices and

branch offices was accepted, the legislator could not be expected to

treat law firms better than individual lawyers by permitting them to

have more than one office.

As to the arguments based on European Community law, the

Constitutional Court noted that the decision of 21 November 1994 had

been served on 23 December 1994, and that Austria joined the European

Union only on 1 January 1995. Accordingly, only the legal position

before 1 January 1995 could be taken into consideration. The

provisions of the European Economic Area (EEA) could not assist the

company: there was no prohibition on Austrian lawyers having an office

in EEA countries, and the Austrian rules on establishment applied

equally to Austrian and non-Austrian lawyers.

The application for registration to the Vienna Bar Association

pursued the same path: the Bar Association refused to register the

company of 9 March 1993; the Supreme Appeals and Disciplinary Board

dismissed the company's appeal on 21 June 1993, and on 27 September

1994 the Constitutional Court quashed the Board's decision. The Board

took a second decision against the company on 21 November 1994, and the

Constitutional Court confirmed that decision on 28 November 1995.

COMPLAINTS

The applicant company alleges violations of Article 6 of the

Convention and of Article 1 of Article 1 of Protocol No. 1, taken

together with Article 14 of the Convention.

Under Article 6 of the Convention, the company claims that the

proceedings in which it was refused registration as a firm of lawyers

determined its civil rights and obligations, and that Article 6 para. 1

therefore applies. It further claims that the requirements of

Article 6 were not met in those proceedings in that one of the judges

in the Constitutional Court, Dr. Heller, did not offer the necessary

guarantees of impartiality: that Dr. Heller is a member of a law firm

in Vienna which has three offices outside Austria, in Bratislava,

Budapest and Prague. The company claims that Dr. Heller had an

interest in preventing the setting up of a law firm which had several

offices and which could compete with his firm, and that he also had an

interest in ensuring that there was a legal basis for firms which are

based in Austria and which had further offices abroad.

Under Article 1 of Protocol No. 1, taken together with Article 14

of the Convention, the company claims that its property rights are

affected by the refusal to let it carry on business through two offices

in that the refusal adversely affects the company's ability to acquire

and keep clients. It claims that to set up subsidiaries is a

normalattribute of a business, and that to limit the company's

activities to one place of business is to interfere in its right to

continue business.

The company also complains that the provisions of European Union

law, now in force in Austria, permit lawyers from other EU countries

to establish themselves in Austria, and, indeed to open more than one

office in Austria if they wish.

THE LAW

1. The company alleges a violation of Article 6 para. 1

(Art. 6-1) of the Convention. Article 6 para. 1 (Art. 6-1) provides,

so far as relevant, as follows:

"1. In the determination of his civil rights and obligations

..., everyone is entitled to a fair and public hearing within a

reasonable time by an independent and impartial tribunal

established by law."

The proceedings in the present case determined the question

whether the Lower Austrian Bar could and would permit the applicant

company to carry on business from offices in Vienna and Mödling,

notwithstanding the express provisions of domestic law that a firm may

only have one office. The domestic decisions found that there were no

constitutional objections to the provisions, and that it was therefore

not possible to permit the company's registration as a law firm.

The Commission is not required to determine whether Article 6

para. 1 (Art. 6-1) is applicable in the present case because, even

assuming that Article 6 (Art. 6) applies, this part of the application

is in any event manifestly ill-founded for the following reasons.

The company alleges a violation of Article 6 (Art. 6) on the

ground that one of the judges in the Constitutional Court on 30 June

1995 was Dr. Heller, who could not be regarded as impartial as he was

a partner in a multi-office partnership with offices in Bratislava,

Budapest and Prague, and therefore had - or at least appeared to have -

an interest in maintaining the existing system as it stood.

The Commission recalls that the existence of impartiality for the

purposes of Article 6 para. 1 (Art. 6-1) of the Convention must be

determined according to a subjective test, that is on the basis of the

personal conviction of a particular judge in a given case, and also

according to an objective test, that is ascertaining whether the judge

offered guarantees sufficient to exclude any legitimate doubt in this

respect (see, in the context of a criminal case, Eur. Court HR,

Hauschildt v. Denmark judgment of 24 May 1989, Series A no. 154, p. 21,

para. 46).

The Commission would first note that there is no question in the

present case of the company having waived its right to challenge Dr.

Heller: the proceedings before the Constitutional Court were in

writing, and the company only knew of Dr. Heller's participation when

it received the judgment. As the Constitutional Court was the final

instance, there is also no question of a further challenge to

Dr. Heller's participation.

In applying the subjective test, the Commission does not find,

and the company does not (and cannot) allege, that Dr. Heller actually

exerted any undue influence on the outcome of the proceedings. The

question is rather whether the company is entitled to have legitimate

doubt as to the appearances in the case.

The Commission does not agree with the company that Dr. Heller's

involvement in a firm with offices in Bratislava, Budapest and Prague

leads to the conclusion that the Constitutional Court did not offer the

requisite guarantees of impartiality. The Commission notes, for

example, that Dr. Heller was only one of 13 judges on 30 June 1995.

Of more importance, however, is the fact that there is no reason why

a judge who is a member of a firm with several offices (abroad) should

necessarily be inclined to wish to limit other firms wishing to set up

several offices in the country. In the Commission's opinion, such a

judge is just as likely to be interested himself in expanding business

at home by setting up further offices within the country.

In conclusion, then, the Commission does not accept that the

Constitutional Court lacked impartiality on either the subjective or

the objective test.

It follows that this part of the application is manifestly ill-

founded within the meaning of Article 27 para. 2 (Art. 27-2) of the

Convention.

2. The company also alleges a violation of Article 1 of Protocol

No. 1 (P1-1) to the Convention, taken together with Article 14

(Art. 14) of the Convention. These provisions run, so far as relevant,

as follows.

"Every natural or legal person is entitled to the peaceful

enjoyment of his possessions. ..."

"The enjoyment of the rights and freedoms set forth in this

Convention shall be secured without discrimination on any ground

such as sex, race, colour, language, religion, political or other

opinion, national or social origin, association with a national

minority, property, birth or other status."

The company claims, in essence, that it has a right to pursue its

business in the form it thinks fit, and that the limitation of law

firms to one office is anachronistic and unjustifiable in a modern

world.

The Commission agrees that, in days of multi-disciplinary

partnerships and multi-national law firms with numerous offices in each

of many countries, a limitation on law firms to just one office might

be considered to be out of step with modern developments in

professional business management. It is not the Commission's function,

however, to give guidance on whether the old or the new should be

encouraged. Rather, in the context of Article 1 of Protocol No. 1

(P1-1), it must first ascertain whether an applicant's possessions are

at all at issue.

The applicant company was created with a view to a merger of two

firms, one in Vienna and one in Mödling. It appears that the company

never in fact practised (as it was never registered), and the company

cannot therefore have had any clients, goodwill, or other assets.

Article 1 of Protocol No. 1 (P1-1) guarantees rights in respect of

existing possessions, rather than guaranteeing rights to

acquisition ofpossessions (see, for example - in a different context -

Eur. Court HR, Marckx v. Belgium judgment of 13 June 1979, Series A

no. 31, p. 23, para. 50).

In the circumstances of the present case, the Commission does not

accept that the refusal to register the company under the Lawyers Act

affected the applicant company's "possessions" at all. There has

therefore been no interference with the right to peaceful enjoyment of

possession in the present case.

In connection with Article 14 (Art. 14) of the Convention, the

Commission recalls that where Article 1 of Protocol No. 1

(P1-1) is inapplicable, Article 14 (Art. 4) cannot be combined with it

(above-mentioned Marckx judgment, ibid.).

It follows that this part of the application is also incompatible

ratione materiae with the provisions of the Convention within the

meaning of Article 27 para. 2 (Art. 27-2) of the Convention.

For these reasons, the Commission, unanimously,

DECLARES THE APPLICATION INADMISSIBLE.

M.F. BUQUICCHIO J. LIDDY

Secretary President

to the First Chamber of the First Chamber

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DALLMANN, HÜGEL, LAURER & VIEHBÖCK OEG v. AUSTRIA

DALLMANN, HÜGEL, LAURER & VIEHBÖCK OEG v. AUSTRIA