Communicated on 13 June 2017

FIFTH SECTION

Application no. 39814/12 AGRO FRIGO OOD against Bulgaria lodged on 12 June 2012

STATEMENT OF FACTS

The applicant company, Agro Frigo OOD, is a Bulgarian limited liability company having its seat in Nova Zagora. It is represented before the Court by Ms N. Dobreva , a lawyer practising in Sofia.

A. The circumstances of the case

The Special Accession Programme for Agriculture and Rural Development (SAPARD) was established in 1999 by the Council of the European Union. Its aim was to provide support for pre-accession measures in the field of agriculture and rural development to Central and Eastern European candidate countries. In Bulgaria, the programme was managed a governmental agency called State Fund “Agriculture” (hereinafter “the Fund”).

In 2006 the applicant company applied for a subsidy under the SAPARD, for a project envisaging the construction of an agricultural market in the town of Nova Zagora. However, in a decision of 18 August 2006 the head of the Fund rejected its application in respect if that project. After the applicant company applied for the judicial review of this decision, in a final judgment of 29 December 2008 the Supreme Administrative Court quashed it and remitted the case to the Fund for a fresh examination.

However, the application could not be re-examined. Bulgaria having joined the European Union on 1 January 2007, contracting by the Fund to final beneficiaries under SAPARD had stopped in October 2007.

In the beginning of 2010 the applicant company brought against the Fund a tort action under the State and Municipalities Responsibility for Damage Act, claiming an award in damages corresponding to the subsidy which it could have received had its application been accepted, namely 5,587,998 Bulgarian levs (BGN), the equivalent of approximately 2,850,000 euros (EUR).

In a judgment of 15 November 2010 the Sofia Administrative Court dismissed the claim. However, upon appeal, in a judgment of 15 April 2011 the Supreme Administrative Court reversed and awarded the applicant company the damages claimed, plus interest. It found, in particular, that there was a direct causal link between the Fund ’ s unlawful refusal to approve the applicant company ’ s application in respect of the project at issue and the damage incurred. The Supreme Administrative Court ’ s judgment was final.

In June 2011 the Minister of Finance, acting on behalf of the State, applied for the judgment at issue to be quashed and the proceedings to be re-opened. He pointed out that the compensation awarded to the applicant company had to be paid from the State budget (payments under the SAPARD having stopped), and considered apparently that the State had been an interested “third party”, which had had to be separately summoned, through the Ministry of Finance, to participate in the proceedings. He made, in addition, a number of arguments concerning the substance of the dispute.

The Supreme Administrative Court held a hearing on 1 December 2011. Counsel for the applicant company contested the application for re-opening, pointing out, in particular, that the State had participated in the initial proceedings.

In a judgment of 20 December 2011 the Supreme Administrative Court allowed the Minister ’ s application, quashed its previous final judgment, re-opened the proceedings and remitted the case for a fresh examination. It considered that the Minister of Finance, as representative of the State, had had to be allowed to participate in the initial proceedings because the judgment of 15 April 2011 “affects directly the State and is unfavourable for it”. Accordingly, it found that the preconditions for re-opening, in particular those set out in Article 246 of the Code of Administrative Procedure, had been met.

After a fresh examination of the case regarding damages, in a final judgment of 11 December 2014 the Supreme Administrative Court dismissed the applicant company ’ s claim.

B. Relevant domestic law

1. Re-opening of administrative judicial proceedings

Re-opening of administrative judicial proceedings is provided for in Chapter Fourteen of the Code of Administra tive Procedure. Articles 245 to 249 deal in particular with re-opening upon request by a third party. Pursuant to Article 246, this is permissible where the third party has not participated in the proceedings at issue and the final judgment affects adversely its rights. The Supreme Administrative Court has repeatedly held that the third party ’ s right to participate in the initial proceedings must have been “guaranteed by law” ( Решение № 2271 от 29.02.2016 г. на ВАС по адм . д. № 6587/2015 г., VI о. , Решение № 11979 от 11.11.2015 г. на ВАС по адм . д. № 6420/2015 г., II о. ).

2. State Fund “Agriculture”

The State Fund “Agriculture” (“the Fund”) was created in 1998 with the adoption of the Support for Agricultural Producers Act ( Закон за подпомагане на земеделските производители ). Section 11(1) of the Act stipulates that the Fund has legal personality and is financed by the State budget. Section 18 provides in addition that the Fund is to be managed by a board, headed by the Minister of Agriculture. The remaining members of the board are to be appointed by the Ministers of Agriculture, Finance, Economics, Environment and Labour.

3. Liability for damage of the authorities

The State and Municipalities Responsibility for Damage Act ( Закон за отговорността на държавата и общините за вреди ) provides in particular, in section 1(1), that the State and the municipalities are liable for damage caused to private individuals and legal entities as a result of unlawful decisions, acts or omissions by their own bodies or officials while discharging their administrative duties.

COMPLAINTS

The applicant company complains under Article 6 § 1 of the Convention about the quashing of the final judgment in its favour of the Supreme Administrative Court of 15 April 2011.

It argues that the quashing of the judgment, in which the Supreme Administrative Court made an award for damages, also breached its rights under Article 1 of Protocol No. 1 to the Convention.

QUESTIONS TO THE PARTIES

1. Did the quashing of the final judgment of the Supreme Administrative Court of 15 April 2011 and the re-opening of the civil proceedings breach the principle of legal certainty and deprive the applicant company of the “right to a court” guaranteed under Article 6 § 1 of the Convention, in view in particular of the fact that the judgment at issue was challenged by a State body, namely the Minister of Finance, and in the initial proceedings the applicant company had opposed another State body, the State Fund “Agriculture”?

The Government are requested to provide examples of other cases where Articles 245-49 of the Code of Administrative Procedure have been applied to requests to confer “third party” status to State bodies in circumstances similar to those in the present case, demonstrating the Supreme Administrative Court ’ s usual approach to such requests.

2. Does the deprivation of the applicant company of the award made in the judgment of 15 April 2011, due to the re-opening of the civil proceedings and the re-examination of its claims, mean that there has also been a breach of Article 1 of Protocol No. 1?