CASE OF WALLNÖFER v. AUSTRIA
(Application no. 64346/09)
11 June 2015
This judgment is final. It may be subject to editorial revision.
In the case of Wallnöfer v. Austria,
The European Court of Human Rights (First Section), sitting as a Committee composed of:
Mirjana Lazarova Trajkovska, President,
Ksenija Turković, judges,
and André Wampach, Deputy Section Registrar,
Having deliberated in private on 19 May 2015,
Delivers the following judgment, which was adopted on that date:
1. The case originated in an application (no. 64346/09) against the Republic of Austria lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (“the Convention”) by an Austrian national, Mr Alois Wallnöfer (“the applicant”), on 26 November 2009.
2. The applicant was represented by Mr W.L. Weh, a lawyer practising in Bregenz. The Austrian Government (“the Government”) were represented by their Agent, Mr H. Tichy, Head of the International Law Department at the Federal Ministry for Europe, Integration and Foreign Affairs.
3. On 11 April 2014 the complaints concerning the length of the proceedings and the alleged violation of the presumption of innocence were communicated to the Government and the remainder of the application was declared inadmissible by the President of the Section in accordance with the Single Judge procedure (Article 27 of the Convention).
THE CIRCUMSTANCES OF THE CASE
4. The applicant was born in 1933 and lives in Innsbruck.
5. The applicant was the manager of Alpenland Holland B.V., a company registered in the Netherlands dealing with artwork.
A. Investigations by the Tax Authority against the applicant for tax fraud
6. On 11 May 1994 the Innsbruck Tax Authority first informed the Innsbruck Public Prosecutor of the suspicion of tax fraud by the applicant in connection with the sale of several pieces of artwork by Alpenland Holland B.V.
7. On 16 May 1994 the Innsbruck Regional Court issued an order for the applicant’s home to be searched. The search was conducted on 30 May 1994, which is also the date when the applicant was first notified of the investigations against him.
8. On 26 February 1997 the Innsbruck Tax Authority submitted its final report to the Innsbruck Public Prosecutor.
B. Criminal proceedings against the applicant
9. On 8 June 1998 the Innsbruck Public Prosecutor issued an indictment against the applicant concerning the suspicion of tax fraud during the years 1989, 1990 and 1992, alleging that the applicant had evaded taxes amounting to 6.87 million. Austrian Schilling (equivalent to approximately 500,000 euros (EUR)).
10. The Innsbruck Regional Court held oral hearings on 19 November 1998, 14 January 1999 and 5 October 2000. On the latter date it acquitted the applicant of the charges. On 22 November 2001 the Supreme Court quashed the judgment upon a plea of nullity by the Innsbruck Tax Authority and referred the case back to the first instance for a re-trial.
11. After having held oral hearings on 5 June 2002, 9 September 2002 and 14 October 2002, the Innsbruck Regional Court convicted the applicant of tax fraud and sentenced him to a fine of EUR 120,000, EUR 40,000 of which was suspended on probation. The judgment was served on 16 November 2002. The applicant lodged a plea of nullity.
12. On 11 September 2003 the Supreme Court again quashed the judgment and referred the case back to the first instance.
13. In March 2003 the Innsbruck Regional Court commissioned an expert to determine the assessment base for the calculation of the taxes.
14. On 18 and 19 November 2004 and on 23 December 2004 further oral hearings were held. The Innsbruck Regional Court remarked in a note to the file dated 14 February 2005, quoting the case Hennig v. Austria (no. 41444/98, 2 October 2003), that the length of the proceedings was already considerable, and admitted that this was attributable to the court system.
15. In March 2004 the expert opinion was delivered. During the oral hearing of 18 May 2006 the Innsbruck Regional Court requested the expert to supplement his report, as it had turned out to be incomplete and did not answer the most relevant questions. A revised expert opinion was received in March 2007.
16. During the oral hearing on 29 May 2009, at which the applicant was heard, the Innsbruck Public Prosecutor withdrew the indictment because the statutory time-limit for the prosecution of the offence had expired. Consequently, the Innsbruck Regional Court acquitted the applicant of the charges (judgment delivered orally on 29 May 2009, served on the applicant’s counsel on 25 February 2010). The written judgment contained, inter alia, the following wording:
“The above-mentioned sales transactions solely aimed at the commission of tax fraud in Austria. No levies were paid in the Netherlands in connection with the sale of the paintings. The profits made constitute income deriving from a business according to Section 23 of the Income Tax Act [Einkommenssteuergesetz], which from an economic point of view are attributable to the applicant according to Section 21 of the Federal Tax Rules [Bundesabgabenordnung]. Taking into account the expenses incurred, tax loads and therefore tax evasion amounting to ATS 975,122.09 (EUR 70,864.89) turnover tax, ATS 4,104,950.75 (EUR 298,318.40) income tax and ATS 1,495,319.40 (EUR 108,669.09) business tax arose.
The accused was determined to effect these transactions in order to mask his tax liability in Austria and thereby commit tax fraud. ...
From a legal point of view, it follows from the facts that the accused was to be acquitted even though the elements of the offence were fulfilled, as the Public Prosecutor withdrew the indictment ...”
C. Reopening of the proceedings
17. Following the Court’s notification of the present application to the Government, the latter informed the Court that, on 18 September 2014, the Procurator General’s Office had lodged a plea of nullity for the preservation of the law regarding the judgment of the Innsbruck Regional Court of 29 May 2009.
18. On 6 November 2014 the Supreme Court held that the judgment in question had violated the applicant’s rights under Article 6 § 2 of the Convention, namely the right to be presumed innocent until proved guilty, on the grounds that the Innsbruck Regional Court had stated in its reasoning that it considered the applicant to be guilty, even though it acquitted him.
I. ALLEGED VIOLATION OF ARTICLE 6 § 1 OF THE CONVENTION
19. The applicant complained that the length of the proceedings had been incompatible with the “reasonable time” requirement, laid down in Article 6 § 1 of the Convention, which reads as follows:
“In the determination of ... any criminal charge against him everyone is entitled to a ... hearing within a reasonable time by a ... tribunal ...”
20. The Government did not express an opinion on the matter. It submitted, however, that the alleged violation of the “reasonable time” requirement under Article 6 § 1 of the Convention was not covered by the judgment of the Supreme Court of 6 November 2014.
21. The period to be taken into consideration began on 30 May 1994 when the applicant’s house was searched, and ended on 29 May 2009 when he was acquitted. It thus lasted 15 years for two levels of jurisdiction.
22. The Court notes that this complaint is not manifestly ill-founded within the meaning of Article 35 § 3 (a) of the Convention. It further notes that it is not inadmissible on any other grounds. It must therefore be declared admissible.
23. The Court reiterates that the reasonableness of the length of proceedings must be assessed in the light of the circumstances of the case and with reference to the following criteria: the complexity of the case, the conduct of the applicant and the relevant authorities (see, among many other authorities, Pélissier and Sassi v. France [GC], no. 25444/94, § 67, ECHR 1999-II).
24. The Court considers that the proceedings at issue were of some complexity, as they concerned cross-border facts and apparently intricate company structures. However, the complexity of the proceedings does not in itself suffice to justify such a substantial duration.
25. As to the conduct of the authorities during the investigative phase, the Court notes that the Innsbruck Public Prosecutor took over four years to submit the final indictment to the Innsbruck Regional Court. The Government has not shown that any significant investigative activity took place during that time, as the content of the indictment did not significantly differ from the tax authority’s initial report of four years earlier. Furthermore, the applicant had no legal remedy available to accelerate the proceedings during the investigative phase.
26. During the trial phase, further delays and significant periods of inactivity occurred before the domestic courts. Lengthy periods of time passed between the three oral hearings during the first set of proceedings. It took the commissioned expert one year to draw up his initial report. Another year and two months passed between the receipt of the expert opinion and the following oral hearing. Furthermore, the expert opinion had to be revised as it turned out to be incomplete, which took another ten months. The presiding judge was replaced in 2005, which caused further delays. The Innsbruck Regional Court itself noted in 2005 that the length of the proceedings was already considerable at that time, admitting that this was attributable to the court system. The last oral hearing, on which occasion the applicant was acquitted, took place two years and two months after the final expert opinion was received.
27. As to the applicant’s conduct, the Court notes on the basis of the information on file that it does not appear that he contributed to the length of the proceedings in question.
28. The Court has frequently found violations of Article 6 § 1 of the Convention in cases raising issues similar to the one in the present case (see Rösslhuber v. Austria, no. 32869/96, § 28, 28 November 2000, Hennig v. Austria, no. 41444/98, § 35, 2 October 2003 and Tuma v. Austria, no. 22833/07, § 21-24, 18 October 2011).
29. Having examined all the material submitted to it, the Court considers that the Government have not put forward any fact or argument capable of persuading it to reach a different conclusion in the present case. Having regard to its case-law on the subject, the Court considers that in the instant case the length of the proceedings was excessive and failed to meet the “reasonable time” requirement.
There has accordingly been a breach of Article 6 § 1.
II. ALLEGED VIOLATION OF ARTICLE 6 § 2 OF THE CONVENTION
30. The applicant complained that the wording of the Innsbruck Regional Court’s judgment of 29 May 2009 violated his right to be presumed innocent until proved guilty as provided in Article 6 § 2 of the Convention, which reads as follows:
“Everyone charged with a criminal offence shall be presumed innocent until proved guilty according to law.”
31. The Government submitted that the Supreme Court, in its judgment of 6 November 2014, had expressly acknowledged that the wording of the judgment of the Innsbruck Regional Court of 29 May 2009 violated the applicant’s rights under Article 6 § 2 of the Convention. Hence, they considered that the applicant was no longer aggrieved concerning this complaint.
32. The applicant pointed out that, while the Supreme Court had acknowledged the violation of Article 6 § 2 of the Convention, he had not received any redress in that respect. Therefore, in his view he retained his status as a victim.
33. The Court reiterates that the question of whether an applicant can claim to be a victim of the violation alleged is relevant at all stages of the proceedings before the Court (see Scordino v. Italy (no. 1) [GC], no. 36813/97, § 179, ECHR 2006-V). A decision or measure favourable to the applicant is not, in principle, sufficient to deprive him or her of his or her status as a “victim” for the purposes of Article 34 of the Convention unless the national authorities have acknowledged, either expressly or in substance, and then afforded redress for the breach of the Convention (see Scordino v. Italy (no. 1) [GC], § 180, cited above; Gäfgen v. Germany [GC], no. 22978/05, § 115, ECHR 2010; Nada v. Switzerland [GC], no. 10593/08, § 128, ECHR 2012). In the present case, while the Supreme Court clearly acknowledged the violation of the Convention complained of, no redress was afforded. However, in that context, the Court notes that the applicant had a separate legal remedy available in order to obtain redress, namely an action to establish the State’s liability (Amtshaftungsklage) pursuant to the Official Liability Act (Amtshaftungsgesetz). There is no information on file to show that the applicant has made use of this remedy in connection with the violation of his right to be presumed innocent until proved guilty.
34. The foregoing considerations are sufficient to enable the Court to conclude that the applicant can no longer be considered a victim for the purposes of Article 34 of the Convention. The complaint under Article 6 § 2 of the Convention must therefore be declared inadmissible.
III. APPLICATION OF ARTICLE 41 OF THE CONVENTION
35. Article 41 of the Convention provides:
“If the Court finds that there has been a violation of the Convention or the Protocols thereto, and if the internal law of the High Contracting Party concerned allows only partial reparation to be made, the Court shall, if necessary, afford just satisfaction to the injured party.”
36. The applicant claimed EUR 526,444.40 in respect of pecuniary damage, and EUR 297,120 in respect of non-pecuniary damage.
37. The Government did not express an opinion on these claims.
38. The Court does not discern any causal link between the violation found and the pecuniary damage alleged; it therefore rejects this claim. On the other hand, it awards the applicant EUR 20,000 in respect of non-pecuniary damage for the violation of the “reasonable time” requirement under Article 6 § 1 of the Convention.
B. Costs and expenses
39. The applicant also claimed EUR 586,529.39 for the costs and expenses incurred before the domestic courts and EUR 10,593.84 for those incurred before the Court.
40. The Government considered these claims to be excessive.
41. According to the Court’s case-law, an applicant is entitled to the reimbursement of costs and expenses only in so far as it has been shown that these have been actually and necessarily incurred and are reasonable as to quantum. In the present case, regard being had to the documents in its possession and the above criteria, the Court rejects the claim for costs and expenses in the domestic proceedings and considers it reasonable to award the sum of EUR 2,000 for the proceedings before the Court.
C. Default interest
42. The Court considers it appropriate that the default interest rate should be based on the marginal lending rate of the European Central Bank, to which should be added three percentage points.
FOR THESE REASONS, THE COURT, UNANIMOUSLY,
1. Declares the complaint concerning the length of the proceedings admissible, and the complaint concerning the violation of the presumption of innocence inadmissible;
2. Holds that there has been a violation of Article 6 § 1 of the Convention;
(a) that the respondent State is to pay the applicant, within three months from the date on which the judgment becomes final in accordance with Article 44 § 2 of the Convention, the following amounts at the rate applicable at the date of settlement:
(i) EUR 20,000 (twenty thousand euros), plus any tax that may be chargeable, in respect of non-pecuniary damage;
(ii) EUR 2,000 (two thousand euros), plus any tax that may be chargeable to the applicant, in respect of costs and expenses;
(b) that from the expiry of the above-mentioned three months until settlement simple interest shall be payable on the above amounts at a rate equal to the marginal lending rate of the European Central Bank during the default period plus three percentage points;
4. Dismisses the remainder of the applicant’s claim for just satisfaction.
Done in English, and notified in writing on 11 June 2015, pursuant to Rule 77 §§ 2 and 3 of the Rules of Court.
André Wampach Mirjana
Deputy Registrar President