THIRD SECTION

DECISION

Application no. 6351/13 Dzhemal Shotayevich NACHKEBIYA against Russia

The European Court of Human Rights (Third Section), sitting on 12 May 2020 as a Committee composed of:

Georgios A. Serghides, President, Erik Wennerström , Lorraine Schembri Orland, judges, and Olga Chernishova, Deputy Section Registrar ,

Having regard to the above application lodged on 30 December 2012,

Having regard to the observations submitted by the respondent Government and the observations in reply submitted by the applicant,

Having deliberated, decides as follows:

THE FACTS

The applicant, Mr Dzhemal Shotayevich Nachkebiya , is a Russian national, who was born in 1949 and lives in Sochi. He was represented before the Court by Mr L. Vanesyan , a lawyer practising in Sochi.

The Russian Government (“the Government”) were represented initially by Mr G. Matyushkin , the Representative of the Russian Federation to the European Court of Human Rights, and then by his successor in that office, Mr M. Galperin .

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

On 3 March 2006 the Khosta District Court of Sochi awarded the applicant 7,111,706 Russian roubles (RUB) against a State-owned floricultural research centre in compensation for taken property. The property in question – a shop and garages – belonged to the applicant but had been built on the centre ’ s land without planning permission ( самовольная постройка ) and the centre had taken possession of it.

On 14 March 2006 the judgment became final.

The judgment was not enforced immediately, and in December 2008 the District Court awarded the applicant RUB 2,295,658 in default interest pursuant to Article 395 of the Civil Code ( проценты за пользование чужими средствами ). The debtor paid this sum by instalments by November 2012.

In February 2012 the District Court awarded the applicant a further RUB 1,706,810 [1] in default interest. The court allowed the debtor to pay this sum by instalments by November 2014.

Because of the research centre ’ s financial hardship, in April 2012 the court allowed it to pay the judgment debt by instalments by November 2013.

In May 2012 the applicant asked the court to raise the judgment debt in line with inflation at the expense of the debtor pursuant to Article 208 of the Code of Civil Procedure ( индексация присуждённой денежной суммы ).

On 24 May 2012 the District Court granted this claim. The debtor appealed.

On 12 July 2012 the Appeal Instance of the Krasnodar Regional Court reversed the decision. The Regional Court found that the applicant could and should have applied for the adjustment earlier because he had been aware of the delayed enforcement, that he was still using the property, that the debtor ’ s only money came from the federal budget for research, and that the delay was not the debtor ’ s fault.

On 5 December 2012 a judge of the Regional Court refused the applicant leave to appeal in cassation ( отказ в передаче кассационной жалобы для рассмотрения ).

By November 2013 the judgment debt was fully paid.

Article 208 of the Code of Civil Procedure provides:

“At the request by the creditor or debtor, the court which examined the case may adjust the award for inflation ( произвести индексацию ) on the day of the enforcement of the judgment....”

Decision of the Constitutional Court No. 153-O-O of 20 March 2008:

“[Article 208 of the Code of Civil Procedure] does not make ... the adjustment of judgment debts for inflation conditional on the debtor ’ s fault in the lengthy non-enforcement of the judgment because such adjustment is not a sanction for the debtor ’ s civil liability ... but a mechanism for full compensation of the creditor ’ s losses ... amid inflation ....”

COMPLAINT

The applicant complained under Article 6 of the Convention about the domestic courts ’ refusal to adjust his judgment debt for inflation.

THE LAW

The Court examined this complaint under Article 1 of Protocol No. 1 which reads:

“Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law.

The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties.”

The Government argued that this complaint was inadmissible because the applicant had failed to exhaust domestic remedies and because it manifestly lacked foundation. In particular, in the Government ’ s opinion, the applicant should have appealed in cassation ( кассация ) against the decision of 12 July 2012 and applied for its supervision ( надзор ). Furthermore, before requesting the adjustment for inflation, the applicant had had his losses compensated twice by the awarded default interest which had cumulatively reached 56.2% of the debt. Throughout the enforcement proceedings the applicant had continued to enjoy the property.

The applicant maintained his complaint. He said that he had not had to appeal in cassation or apply for supervision of the decision because those remedies were ineffective. He pointed out that he had appealed in cassation nevertheless. In the applicant ’ s opinion, the default interest and adjustment for inflation could coexist because they served different goals: to penalise the debtor for the unlawful retention of the creditor ’ s money, on the one hand, and to make good the creditor ’ s inflationary loss regardless of the creditor ’ s fault, on the other.

The Court notes, with regard to the exhaustion of domestic remedies, that the applicant had lodged his application in December 2012, that is before the Court recognised the appeal in cassation effective in 2015, and, therefore, the applicant is dispensed from the requirement to use that remedy (see Novruk and Others v. Russia , nos. 31039/11 and 4 others, §§ 74–76, 15 March 2016). Besides, an application for supervisory review is not a remedy to be exhausted ( ibid., § 76).

The Court further reiterates that the “possessions” within the meaning of Article 1 of Protocol No. 1 can be either existing possessions or assets, including claims, in respect of which an applicant can argue that he has at least a “legitimate expectation” that they will be realised (see, with further references, Polacek and Polackova v. the Czech Republic ( dec. ), no. 38645/97, § 62, 10 July 2002). Furthermore, it cannot in principle be said that an applicant has a sufficiently established claim amounting to an “asset” for the purposes of Article 1 of Protocol No. 1 where there is a dispute as to the correct interpretation and application of domestic law and where the question whether or not the applicant complied with the statutory requirements is to be determined in judicial proceedings (see, with further references, Radomilja and Others v. Croatia [GC] , nos. 37685/10 and 22768/12 , § 149, 20 March 2018).

Turning to the present case, the Court notes that by the terms of Article 208 of the Code of Civil Procedure adjustment of judicial awards for inflation was within the competence of the domestic courts right. In addition, the applicant ’ s entitlement to that adjustment was disputed and ultimately denied in the judicial proceedings. Lastly, the Convention does give raise to any positive obligation for the State to maintain the value of claims or any other assets (see O.N. v. Bulgaria ( dec. ), no. 35221/97, 6 April 2000).

For these reasons the Court considers that the applicant ’ s claim was not a “possession” within the meaning of Article 1 of Protocol No. 1.

Accordingly, this complaint is manifestly ill-founded and must be rejected in accordance with Article 35 §§ 3 (a) and 4 of the Convention.

For these reasons, the Court, unanimously,

Declares the application inadmissible.

Done in English and notified in writing on 11 June 2020 .

Olga Chernishova Georgios A. Serghides Deputy Registrar President

[1] EUR 43,000.