THIRD SECTION

DECISION

AS TO THE ADMISSIBILITY OF

Application no. 61294/00 by Agatina BUONPANE against Germany

The European Court of Human Rights (Third Section), sitting on 20 November 2003 as a Chamber composed of:

Mr I. Cabral Barreto , President , Mr G. Ress , Mr L. Caflisch , Mr P. Kūris , Mr R. Türmen , Mr B. Zupančič , Mrs M. Tsatsa-Nikolovska , judges , and Mr V. Berger , Section Registrar ,

Having regard to the above application lodged on 11 September 2000 ,

Having deliberated, decides as follows:

THE FACTS

The applicant, Mrs Agatina Buonpane, is an Italian national, who was born in 1963 and lives in Runkel . She is represented before the Court by Mr Georg Königstein, a lawyer practising in Brechen -Niederbrechen .

A. The circumstances of the case

The facts of the case, as submitted by the applicant , may be summarised as follows.

The applicant owed 81,875.18 DEM (German marks) to more than twenty creditors. She had made an unsuccessful attempt to obtain discharge of the residual debt on the basis of a debt reorganisation plan . However, t he majority of the creditor ’ s refused to agree to this plan .

On 8 May 2000 the applicant applied for legal aid with a view to initiating insolvency proceedings and achieving discharge of residual debt.

On 10 May 200 the Limburg District Court ( Amtsgericht ) dismissed her request. Leaving the question undecided whether the legal aid provisions contained in the Code of Civil Procedure ( Zivilprozessordnung ) appl ied to insolvency proceedings, it considered that in the present case the proposed proceedings did not have sufficient prospects of success , since m ore than half the named creditors had refused to approve the applicant ’ s debt reorganisation plan . Pursuant to Section 309 § 1 of the Insolvency Statute ( Insolvenzordnung ), the insolvency court could not replace their objection by approval and the insolvency proceedings had to be considered as having failed.

The applicant appealed against this decision. She maintained that i f she were refused legal aid in the insolvency proceedings, s he would be deprived of the possibility to proceed to the subsequent procedural steps provided for by the Insolvency Statute , namely the opening of insolvency proceedings and the grant of discharge for thee residual debt after the expiry of the period of good payment behaviour . To make a difference in insolvency proceedings between debtor s who w ere able to pay the court costs and others who w ere unable to do so, would exclude the l ess privileged from being granted a discharge f or the residual debt and breac h their right to access to court.

On 28 June 2000 the Limburg Regional Court ( Landgericht ) dismissed the appeal. It pointed out that the question of legal aid in insolvency proceedings, including the proceedings relating to discharge of residual debt, was controversial. Unlike bankruptcy proceedings where, in the absence of any positive effect for the debtor, legal aid had to be refused for lack of sufficient prospects of success within the meaning of Section 114 of the Code of Civil Procedure, insolvency proceedings could have a positive outcome for the debtor, namely to give the debtor the opportunity to achieve a discharge of the residual debt in accordance with Section 1 of the Insolvency Statute. However, this advantage could only be granted if previously an unsuccessful attempt had been made to settle out of court with the creditors on a basis of a plan and subsequently insolvency proceedings conducted until at least the discontinuation of the proceedings. In the present case the plan for the settlement of debts submitted by the applicant had not been approved by more than half the creditors. Their approval could not be replaced by the court. The out of court settlement proceedings must therefore be considered as having failed.

The Regional Court added that in any event Sections 114 seq. of the Code of Civil Procedure were not applicable in consumer insolvency proceedings although there were no specific rules excluding the applicability of these provisions. However, the drafting history of the Insolvency Act made it clear, on the other hand, that the legislator did not intend to include expressly provisions on legal aid in the new law. A clarification of this situation had not occurred. The Regional Court pointed out that it was not its task to decide on the question whether such a clarification would be desirable, in particular having regard to the absence of sufficient financial means of most of the debtors and the purpose of discharging them from their remaining debts pursuant to Section 1 of the Insolvency Act.

On 22 August 2000 the Federal Constitutional Court ( Bundesverfassungsgericht ), sitting as panel of three judges, decided not to entertain the applicant ’ s constitutional complaint considering that it did not raise any constitutional issue of fundamental importance and that there was no appearance of a violation of the applicant ’ s basic rights

B. Relevant domestic law and practice

The Insolvency Statute ( Insolvenzordnung ) came into force on 1 January 1999 . The law distinguishes between regular insolvencies and consumer insolvencies (simplified proceedings). The procedure is initiated at the request of the debtor or of a creditor if the debtor is insolvent. One of the major amendments in the context of the new insolvency law was the introduction of a special consumer insolvency procedure. If the debtor is a natural person, he or she may be discharged from his or her remaining debts. In accordance with the Insolvency Statute as amended o n 1 January 2001 , natural persons , who are not able to pay the costs of the insolvency proceedings, may be granted a delay in paying the costs. This facilitates the opening of insolvency proceedings which are in turn a precondition for achieving a discharge of residual debt. A central issue, namely the granting of legal aid , is still unresolved.

The consumer insolvency procedure consists of three phases:

1. The debtor must seek an out of court-settlement with the creditors. Only if all creditors agree the plan the proceedings may be completed at this stage.

2. If his attempt to reach an agreement is unsuccessful, the court insolvency proceedings follow. The court attempts once more to arrive at an agreement between the creditors and the debtor on the basis of a debt reorganisation plan. The debtor must submit files detailing his or her assets and income, together with a list of creditors and their claims, to the court. Furthermore the debtor must prove that all attempts to secure an agreement with the creditors have failed. Where the majority of creditors agree to the plan, the court may substitute the approval of individual creditors under certain conditions .

3. After the opening of insolvency proceedings claims are examined and validated. The debtor ’ s assets are liquidated by a trustee appointed by the court. If the debtor settles with the creditors to the best of his ability, he is discharged from his remaining debts after a period of good payment behaviour. This period will be usually seven years.

COMPLAINT S

The applicant complains under Article 6 of the Convention that she was refused legal aid with a view to instituting insolvency proceedings. She was thus prevented to be heard before a court. She also complains that she was treated less favourably than debtors who request legal aid before regional courts with a more favourable approach to granting legal aid in insolvency proceedings. Finally she complains of a difference of treatment on grounds of financial means.

THE LAW

1. The applicant complained that the denial of legal aid in insolvency proceedings violated her right to effective access to a court under Article 6 § 1 of the Convention.

The relevant part of Article 6 § 1 provides:

“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 Court recalls that the right of access to a court constitutes an element which is inherent in the right to a fair trial under Article 6 § 1 (see, among other authorities, Golder v. the United Kingdom , judgment of 21 February 1975, Series A no. 18, p. 18, § 36).

The applicant applied for legal aid with a view to instituting insolvency proceedings. According to the Limburg Regional Court , legal aid is not available for such proceedings. Thus prima facie the Co urt acknowledges that there could be a potential problem of access to court.

However in the present case the main reasons which led the courts to refuse legal aid are based on the view that the proposed insolvency proceedings lacked reasonable prospects of success . The courts pointed out that the majority of the creditors had not agreed to the debt reorganisation plan, submitted by the applicant and that their approval could not be replaced by a court decision.

The Court re-iterates that it is in the first place for the national authorities, and notably the courts, to interpret domestic law and the Court will not substitute its own interpretation for theirs in the absence of arbitrariness (see, mutatis mutandis , Tejedo Garcia v. Spain , judgment of 16 December 1997, Reports of Judgments and Decisions 1997-VIII, p. 2796, § 31). There is no indication in the present case that the applicant ’ s arguments were not duly examined by the German courts or that the interpretation of the relevant legal provisions was arbitrary or otherwise unfair and thus contrary to the requirements of Article 6 of the Convention.

Article 6 § 1 leaves to the State a free choice of the means to be used in guaranteeing litigants a right of effective access to a court and furthermore there is no obligation on the State to provide legal aid for every dispute relating to a “civil right” ( Airey v. Ireland , judgment of 9 October 1979, Series A no. 32 , pp. 12-16, § 26).

It is self-evident that where a State chooses a legal aid system to provide access to court, such a system can only operate effectively, given the limited resources available, by establishing machinery to select which cases should be legally aided. Such limitations on the availability of legal aid, common to most Convention countries, often require a financial contribution or that the proposed litigation has reasonable prospects of success (see X v. the United Kingdom , no. 8158/78, Commission decision of 10 July 1980, Decisions and Reports (DR). 21, p. 95).

In view of the above circumstances, it cannot be said that the refusal of legal aid impaired the applicant ’ s right under Article 6 § 1 of the Convention in a manner that would her deprive of her right of access to a court.

It follows that this complaint is manifestly ill-founded within the meaning of Article 35 § 3 of the Convention and must be rejected in accordance with Article 35 § 4.

2. The applicant also complained of a difference in treatment deriving from the different views of regional jurisdictions in Germany on the question of legal aid in insolvency proceedings. To be granted legal aid depended thus on the geographical location of the person concerned. This difference in treatment from others in a comparable situation in their enjoyment of their right to access to court could not be objectively and reasonably justified. As a consequence, the refusal of legal aid to debtors without sufficient financial means deprived them of the possibility of obtaining the opening of insolvency proceedings and subsequently being granted a discharge of the residual debt.

The Court has examined this complaint under of Article 14 of the Convention taken in conjunction with Article 6 § 1.

Article 14 provides:

“The enjoyment of the rights and freedoms set forth in [the] 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 Court notes that legal aid has been refused for lack of sufficient prospects of success of the proposed insolvency proceedings. It finds no indication of discrimination as regards the application of this principle in the applicant ’ s case. Furthermore, this complaint is subsumed in her general complaint that she was denied access to court.

It follows that this part of the application is likewise is manifestly ill-founded within the meaning of Article 35 § 3 of the Convention and must be rejected in accordance with Article 35 § 4.

For these reasons, the Court unanimously

Declares the application inadmissible.

Vincent Berger Ireneu Cabral Barreto Registrar President