THIRD SECTION

DECISION

AS TO THE ADMISSIBILITY OF

Application no. 35376/97

by Roman KRČMÁŘ and Others

against the Czech Republic

The European Court of Human Rights ( Third Section) sitting on 27 April 1999 as a Chamber composed of

Sir Nicolas Bratza, President ,

Mr J.-P. Costa,

Mr L. Loucaides,

Mrs F. Tulkens,

Mr W. Fuhrmann,

Mr K. Jungwiert,

Mr K. Traja, Judges ,

with Mrs S. Dollé, Section Registrar ;

Having regard to Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms;

Having regard to the application introduced on 17 March 1997 by Roman KRČMÁŘ and Others against the Czech Republic and registered on 18 March 1997 under file no. 35376/97;

Having regard to the reports provided for in Rule 49 of the Rules of Court;

Having regard to the observations submitted by the respondent Government on 13 May 1998 and the observations in reply submitted by the applicants on 22 June 1998;

Having deliberated;

Decides as follows:

THE FACTS

The applicants are seven Czech nationals. Before the Court, they are represented by Mr A. Pejchal, a lawyer practising in Prague. The details concerning the applicants are set out in the Annex.

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

A. Particular circumstances of the case

The applicants are successors in title to a company in Rakovník which belonged to their family until it was nationalised by the former communist regime.

Pursuant to Section 1(5) of Presidential Decree No. 101/1945 (dekret presidenta republiky) ("the Decree"), which entered into force on 27 October 1945, companies producing soap and margarine with more than 150 employees, were nationalised as of the date of its entry into force. The former Minister of Food (ministr výživy) declared, according to Section 1(4) of the Decree, which companies had been nationalised, as recorded in the Official Register (Úřední list) . On 28 June 1948 Act No. 115/1948, which amended the Decree, entered into force. According to the Act, all enterprises nationalised before 22 February 1948, pursuant to Section 1(4) of the Decree, were considered nationalised as of 27 October 1945. The Act did not specify the number of employees in the nationalised enterprises.

By decree (vyhláška) No. 26 of 9 January 1946 the former Minister of Food declared the applicants’ company nationalised. The nationalisation procedure was closed by an order (výměr) of the former Minister of Food on 11 January 1949 which determined the final extent of the nationalisation. The order was based on Section 1(1)(6) of Act No. 115/1948.

In November 1991, pursuant to the Extra-Judicial Rehabilitations Act (zákon o mimosoudních rehabilitacích) (“the Restitution Act”) in connection with the Transfer of the State’s property to Other Persons Act (zákon o převodu majetku státu na jiné osoby) (“the Privatisation Act”) , the applicants introduced an action for restitution of the property in question. They claimed that they were Czech nationals and successors in title to the original owners of the property and, therefore, persons entitled to restitution under Section 3(2)(c) of the Restitution Act. They also claimed that the property had been nationalised in a way which violated generally recognised human rights and freedoms within the meaning of Section 2(3) of the Restitution Act. They further submitted that the Decree had been wrongly applied to their family’s property because the nationalisation conditions determined in the Decree, in particular the condition that the company have more than 150 employees, were not satisfied. Consequently, the applicants argued that the company had been nationalised pursuant to Act No. 115/1948, that is after 25 February 1948, the decisive date for restitution under the Restitution Act.

On 29 June 1993, the Prague 1 District Court (obvodní soud) found against the applicants. The Court found that ownership of the applicants’ property had passed to the State by the ministerial decree of 9 January 1946, which was before the decisive date of 25 February 1948 specified in the Restitution Act. Accordingly, this Act as well as the Privatisation Act did not apply to the applicants’ case. The Court noted that the order of the Minister of Food of 11 January 1949 had only a declaratory character. The Court stated that the fact that the Decree had been applied to the applicants’ property contra legem , as the company had less than 150 employees, could not influence the Court’s finding as to the decisive date of the nationalisation.

The applicants appealed to the Prague Municipal Court (městský soud) and the High Court (Vrchní soud) . On 24 November 1993 the Prague Municipal Court and on 28 July 1995 the High Court confirmed the judgment of the Prague 1 District Court.

On 22 October 1995 the applicants lodged a constitutional appeal (ústavní stížnost) . They alleged a violation of Article 11 § 1 and 36 § 1 of the Charter of Fundamental Rights and Freedoms and challenged the legal opinion of the national courts.

On 2 October 1996 the Constitutional Court, after a public hearing, dismissed the applicants’ appeal finding no violation of the applicants’ rights. The Court, having considered the question of the number of employees in the applicants’ company at the time of the nationalisation as a crucial point at issue, decided to complete the taking of evidence and asked the Rakovník District Records Office (státní okresní archiv) , the Prague District Records Office státní oblastní archiv) , the Prague Central Records Office (státní ústřední archiv) , the Ministry of Work and Social Affairs (ministerstvo práce a sociálních věcí) and the Ministry of Finance (ministerstvo financí) to submit further documentary evidence. These ministries held information about the number of employees in the company in 1938, 1939 and 1940 in different categories of production. The Court then, basing its finding on these documents which it had sought itself and which had not been shown to the parties during the hearing, stated, contrary to the opinion of the lower courts, that the nationalisation had been effected in compliance with the nationalisation conditions established in the Decree, i.e. before 25 February 1948. Accordingly, the applicants were not entitled to the restitution of the company.

B. Relevant domestic law

Extra-Judicial Rehabilitations Act No. 87/1991 of 23 March 1991 (“the Restitution Act”)

In the preamble to the Restitution Act, the Federal Assembly of the Czech and Slovak Federal Republic affirmed its will to prevent violations of the kind committed in the past.

Section 1(1) of the Act provides that its aim is to redress the consequences of certain violations of property and other rights caused by acts falling within the sphere of civil or labour law or by administrative acts incompatible with the principles of a democratic society respecting the rights of citizens, as enshrined in the Charter of the United Nations and the Universal Declaration of Human Rights.

According to Section 2(1)(c) and (3), such redress consists in the surrender of property if the violation in question was caused by an act infringing generally recognised human rights and freedoms, that is, an act in contradiction with the principles referred to in Section 1(1) of the Act. When an entitled person was deprived of his or her property rights without appropriate compensation under nationalisation laws adopted between 1945 and 1949, the entitled person has a claim under this Act, which he or she can raise under the Privatisation Act.

Section 3(1) provides that, in order to be entitled to restitution of his or her property, a claimant must be a physical person and a citizen of the Czech and Slovak Federal Republic whose property was ceded to the State in the circumstances listed in Section 6 of the Act. According to Section 3(2)(e), if the person whose property has been transferred to the State in cases specified in Section 6 died before the expiry of the period specified in Section 5(2), the entitled persons, provided they are citizens of the Czech and Slovak Federal Republic, are his or her spouse and children, or in the case of the latter’s death, their children.

Charter of Fundamental Rights and Freedoms

Article 11 § 1 provides inter alia that everybody has the right to own property. The property rights of every owner are equal in the eyes of the law and benefit from the same legal protection.

According to Article 36 § 1, everybody may defend, in a way prescribed by law, his or her right before an independent and impartial tribunal and, in specified cases, with another authority.

Constitutional Court Act No. 182/93

According to Section 48, the Constitutional Court must consider all the evidence necessary to establish the facts of the case. It decides what evidence, out of that submitted by the parties, it is necessary to consider and may take account of other evidence which has not been proposed. It may assign a judge to consider certain evidence outside of the oral hearing or request another court to consider certain evidence. At the request of the Constitutional Court, courts, public administrative authorities and other State institutions must grant it their assistance in procuring documentary evidence for use in its decision-making. A record is drawn up of all evidence which is considered outside the oral hearing, and signed by a judge, a clerk and other persons taking part. The resultant evaluation of that evidence must always be communicated at the oral hearing.

Section 63 requires that the provisions of the Code of Civil Procedure apply in the procedure before the Constitutional Court, unless the Constitutional Court Act provides otherwise.

According to Section 81, the Constitutional Court is not bound by the statements of fact established in the preceding proceedings.

Code of Civil Procedure (Act No. 99/1963, as amended)

According to Section 129, the consideration of documentary evidence is done by the president of a chamber during the hearing. The president reads out the whole or part of the document, or informs the chamber of its contents. He or she can also invite the holder of the document to submit the document to the court, or he or she obtains for himself or herself the document from another court, authority or legal person.

COMPLAINTS

The applicants complain that they did not have a fair hearing as guaranteed by Article 6 § 1 of the Convention in the proceedings before the Constitutional Court, because the Court based its decision on documents which were not assessed at the hearing and were not shown to and discussed by the parties.

PROCEDURE

The application was introduced on 17 March 1997 and registered on 18 March 1997.

On 4 March 1998, the Commission decided to communicate the application to the respondent Government.

The Government’s written observations were submitted on 13 May 1998. The applicants replied on 22 June 1998.

On 1 November 1998, by operation of Article 5 § 2 of Protocol No. 11 to the Convention, the case fell to be examined by the Court in accordance with the provisions of that Protocol.

THE LAW

The applicants complain that they did not have a fair hearing in the proceedings before the Constitutional Court, because the Court based its decision on documents which were not assessed at the hearing and were not shown to and discussed by the parties. The Constitutional Court thereby breached Article 6 § 1 of the Convention, the relevant part of which provides as follows:

“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 respondent Government consider that the applicants’ claims are manifestly ill-founded. They submit that at the oral hearing, the Constitutional Court read out a report of the former Ministry of Food establishing the nationalisation conditions of the applicants’ company. The report found that the nationalisation conditions laid down in the Decree had been satisfied, because the average number of employees was 204, which was more that the limit of 150 employees required by the Decree. The applicants did not object to these proceedings, nor did they make any suggestion in this regard. The Government further submit that, according to Section 81 of the Constitutional Court Act, the Constitutional Court was not bound by the statements of fact established in the preceding proceedings. The Government conclude that the Constitutional Court complied with the requirements of a fair hearing under Article 6 § 1 of the Convention.

The applicants dispute the Government’s arguments. They submit that the report of the former Ministry of Food does not exist (the Government did not specify the date or reference of this document). The applicants also note that during the oral hearing, the Constitutional Court did not consider any documentary evidence. It only summed up the judgments of the lower courts.

The applicants stress that in the proceedings in the Prague 1 District Court, they submitted observations concerning the number of employees of the company calculated, upon the request of the former Ministry of Food of 24 November 1945, by the former owners in accordance with the law then in force. They found that in the production of margarine, which was the sole production covered by the Decree, an average of 117.3 persons were employed between 1938 and 1940. The applicants submit that the former Ministry of Food received the observations of the trade union council (závodní rada), which concluded that the average number of employees was 204.3. The Ministry did not draft or submit any report, but only declared which companies had been nationalised. In these circumstances, at the Constitutional Court hearing, the judge rapporteur did not consider new evidence, but summed up the evidence on the basis of which the Prague 1 District Court had found that the nationalisation had been effected contrary to the Decree. The applicants note that in comparing the figures calculated by the former owners of the company with those calculated by the trade union council, it is easy to see that if the latter were accepted, it would follow that, between 1938 and 1940, the administrative staff concerned with margarine production would have outnumbered the production staff by a ratio of approximately two to one. Undoubtedly, this would have been absurd. Such an arrangement could never have been sustained and could never have occurred.

The applicants further submit that the Constitutional Court based its judgment on documents received from five institutions. These documents were produced at the oral hearing and the applicants could not discuss them. If the Constitutional Court had started by obtaining evidence related to the facts already ascertained, the applicants’ submissions would have been completely different. They could have brought forward additional evidence, including witnesses such as former employees of the company who were still alive and the second and third applicants (daughters of the former owners), who could have confirmed the absurdity of the calculations made by the trade union council.

The applicants finally observe that if the Constitutional Court regarded the question of the number of employees as a fundamental question (as it was), it should have ascertained the correct number of employees. The Court should not have based itself, without further justification, on the communist trade union council’ finding, whose intention was to nationalise the company at all costs. If the Constitutional Court had produced the documentary evidence that it had previously demanded, it would have been forced to take into account the applicants’ submissions containing the correct calculation of the average number of employees.

The applicants conclude that in the proceedings before the Constitutional Court they did not have a fair hearing as provided for in Article 6 § 1 of the Convention.

The Court considers, in the light of the parties’ submissions, that the case raises complex and serious issues of law and facts under the Convention, the determination of which should depend on an examination of the merits of the application as a whole. The Court concludes, therefore, that the application is not manifestly ill-founded within the meaning of Article 35 § 3 of the Convention. No other grounds for declaring it inadmissible have been established.

For these reasons, the Court, unanimously,

DECLARES THE APPLICATION ADMISSIBLE , without prejudging the merits of the case.

S. Dollé N. Bratza

Registrar President

A N N E X

Name Date of birth Domicile

1. Roman KRČMÁŘ 10.09.1957 Prostějov, Czech Rep.

2. Marie HANUŠOVÁ 17.09.1922 Praha, Czech Rep.

3. Jaroslava BARTOŠOVÁ 13.01.1923 Praha, Czech Rep.

4. Eduarda OTTOVÁ 02.04.1931 Praha, Czech Rep.

5. Dagmar RYDLOVÁ 18.05.1932 Praha, Czech Rep.

6. Eva KAŇOKOVÁ 19.02.1935 Praha, Czech Rep.

7. Michaela KRČMÁŘOVÁ 27.06.1967 Speyr, Germany