Source: http://echr.ketse.com/doc/13427.87-en-19941209/view/
Timestamp: 2019-01-18 02:24:55
Document Index: 477297281

Matched Legal Cases: ['art. 32', 'art. 47', 'art. 25', 'art. 44', 'art. 48', 'art. 46', 'art. 6', 'art. 43', 'in fine', 'art. 43', 'sui generis', 'art. 6', 'art. 31', 'art. 6', 'art. 6', 'art. 6', 'art. 6', 'art. 6', 'art. 6', 'art. 6', 'art. 6', 'art. 6', 'art. 6', 'art. 6', 'art. 6', 'art. 6', 'art. 6', 'art. 6', 'art. 25', 'in fine', 'art. 6', 'art. 6', 'in fine', 'art. 50', 'art. 50', 'art. 50', 'art. 50', 'art. 6', 'art. 6', 'art. 6']

STRAN GREEK REFINERIES AND STRATIS ANDREADIS v. GREECE About Project
In the case of Stran Greek Refineries and Stratis Andreadis v. Greece*,
1. The case was referred to the Court by the European Commission of Human Rights ("the Commission") on 12 July 1993, within the three-month period laid down by Article 32 para. 1 and Article 47 (art. 32-1, art. 47) of the Convention. It originated in an application (no. 13427/87) against the Hellenic Republic lodged with the Commission under Article 25 (art. 25) by a Greek private limited company, Stran Greek Refineries, and the latter’s sole shareholder, Mr Stratis Andreadis, on 20 November 1987. The second applicant died in 1989 and his son and heir, Mr Petros Andreadis, expressed the wish to continue with the application.
The Commission’s request referred to Articles 44 and 48 (art. 44, art. 48) and to the declaration whereby Greece recognised the compulsory jurisdiction of the Court (Article 46) (art. 46). The object of the request was to obtain a decision as to whether the facts of the case disclosed a breach by the respondent State of its obligations under Article 6 (art. 6) of the Convention and Article 1 of Protocol No. 1 (P1-1).
3. The Chamber to be constituted included ex officio Mr N. Valticos, the elected judge of Greek nationality (Article 43 of the Convention) (art. 43), and Mr R. Ryssdal, the President of the Court (Rule 21 para. 3 (b)). On 25 August 1993, in the presence of the Registrar, the President drew by lot the names of the other seven members, namely Mr B. Walsh, Mr R. Macdonald, Mr C. Russo, Mr S.K. Martens, Mr R. Pekkanen, Mr F. Bigi and Mr L. Wildhaber (Article 43 in fine of the Convention and Rule 21 para. 4) (art. 43).
4. As President of the Chamber (Rule 21 para. 5), Mr Ryssdal, acting through the Registrar, consulted the Agent of the Greek Government ("the Government"), the applicants’ lawyer and the Delegate of the Commission on the organisation of the proceedings (Rules 37 para. 1 and 38). Pursuant to the order made in consequence, the Registrar received the Government’s memorial on 13 January 1994 and the applicants’ memorial on 19 January. On 21 February the Secretary to the Commission informed the Registrar that the Delegate would submit his observations at the hearing.
5. In accordance with the President’s decision, the hearing took place in public in the Human Rights Building, Strasbourg, on 19 April 1994. The Court had held a preparatory meeting beforehand.
Legal Council of State, Counsel;
Mr K.D. Kerameus, Professor of Law
at Athens University, Advisers.
7. Under the terms of a contract concluded on 22 July 1972 with the Greek State, which at the time was governed by a military junta, Mr Andreadis undertook to construct a crude oil refinery in the Megara region, near Athens. The refinery was to be built, at an estimated cost of 76,000,000 US dollars, by a company which it was proposed to form, Stran Greek Refineries, of which the second applicant was to be the sole owner. All the latter’s rights and obligations were to be automatically transferred to the company upon its incorporation.
8. However, the project stagnated because the State failed to fulfil its obligation. On 28 November 1973 the Ministers of Industry and Agriculture announced at a press conference in Megara the Government’s decision to return to the proprietors the land which had already been expropriated in accordance with Article 21 of the contract. The following day the Megara police ordered that the work should cease.
11. In a preliminary decision (no. 13910/1979) of 29 September 1979, the Athens Court of First Instance rejected the State’s main submission. It held that the arbitration clause concerned solely the settlement of disputes arising from the performance of the contract and not the failure of one of the parties to perform the contract. It found further that the ministerial committee on the economy had terminated the contract in issue in its entirety (see paragraph 9 above) which had the effect of rendering the arbitration clause void as it was not an autonomous provision. In addition, the court dismissed the State’s argument that two of the conditions subsequent contained in the contract, namely the lodging of a cheque as security and the payment of the second part of the minimum capital, had not been satisfied. Finally, the court ordered additional investigative measures, including the hearing of five witnesses, in order to determine the existence and extent of the damage alleged by Stran.
In its memorial of 28 June 1980 Stran - which had appointed a professor of law at Athens University as arbitrator - maintained primarily that the arbitration court lacked jurisdiction and requested that the arbitration be stayed until the proceedings instituted on 10 November 1978 had been concluded; in the alternative and in order to rebut the State’s arguments on the merits, it referred the arbitrators to its pleadings in the Athens Court of First Instance.
On the merits, the arbitration court relied on the evidence adduced by the parties before the Athens Court of First Instance on 10 November 1978 (see paragraph 10 above). It found that responsibility for the losses sustained by Stran was shared - 70% for the State and 30% for the company. The latter had commenced work on land which had been the subject of a contested expropriation order and without first obtaining the necessary planning permission. It therefore held Stran’s claims to be well-founded in an amount not exceeding 116,273,442 drachmas, 16,054,165 US dollars and 614,627 French francs, plus interest at 6% from 10 November 1978; however, this reference to interest did not appear in the operative part of the decision. Finally, the court declared that the State was unlawfully retaining the cheque lodged as security (see paragraph 10 above).
14. On 24 July 1984 the applicant company sought an order from the Athens Court of First Instance requiring the State to return the security, but the court stayed the proceedings pending the conclusion of those instituted on 10 November 1978 (see paragraph 10 above).
It argued that the arbitration court had lacked jurisdiction to hear disputes arising from the contract in issue and Stran’s financial claims against the State. In the alternative, it affirmed that the contracting parties had intended to limit the jurisdiction of the arbitration court to disputes concerning the performance and interpretation of the clauses of the contract and the scope of the rights and duties deriving therefrom; its jurisdiction could not therefore extend to disputes relating to the total failure to perform the contract. It followed that the dispute in question was a matter for the ordinary civil courts, as the Athens Court of First Instance had recognised in its judgment no. 13910/1979. In the further alternative, the State argued that the arbitration court’s lack of jurisdiction was confirmed by the fact that Stran’s claims against it had become statute-barred following the termination of the contract. Finally, it stressed the declaratory nature of the action brought by Stran on 10 November 1978 (see paragraph 10 above).
16. In a judgment (no. 5526/1985) of 21 April 1985 the Athens court dismissed the State’s application, holding that the decision terminating the contract had not rendered the arbitration clause void. That clause continued to produce its effects in relation to disputes which had arisen during the period of validity of the contract.
The hearing was initially set down for 4 May 1987, but on that date it was postponed to 1 June 1987 at the State’s request, on the ground that a draft law concerning the case in question was before Parliament.
In reply to a question put by the European Court at the hearing on 19 April 1994, the applicants’ lawyer maintained that the Court of Cassation’s judge-rapporteur had sent his opinion, which had been favourable to the applicants’ arguments, to the parties before 4 May and this affirmation was not disputed by the Government.
Not only does [Article 107] of the Constitution confer superior force on Law no. 141/1975, but it also prohibits subsequent amendments or additions thereto, or even authoritative interpretation thereof, in the form of ordinary legislation. The purpose of that superior force and of the provision in the Constitution requiring that a single law be enacted once and for all within three months of the entry into force of the Constitution was to ensure legislative stability and international confidence for investments in Greece. This opinion is based on the only possible meaning to be attributed to the expression ‘single law to be enacted once and for all’ and on the ease with which the said provision would be flouted if amendments, additions or authoritative interpretation of that law were allowed ...
"... [The Constitution] provides for the enactment of ‘a single law to be enacted once and for all’ which by definition possesses superior force inasmuch as it may be neither supplemented nor amended by ordinary legislation ... However, the prohibition on supplementing or modifying the content of [such] laws does not mean that they may never be interpreted. The fact that they are sui generis, which gives them precedence over ordinary legislation, ... does not preclude their interpretation where the circumstances so require. The purpose of such interpretation is not to amend the substance of the law interpreted, but to clarify its original meaning and to resolve disputes that have arisen in connection with its application or which may do so in the future. [The need for such interpretation] will ultimately be determined by the court which will have to ascertain whether the meaning of the law interpreted actually gave rise to doubts justifying the intervention of the legislature ... Accordingly, the interpretation of Law no. 141/1975 is not contrary to the Constitution merely because it is a law of superior rank. It must nevertheless be determined, on the one hand, whether the interpretation was necessary in the specific case and, on the other, whether the non-interpretative provisions of this Law, which have a bearing on the solution of the case in issue, are contrary to the Constitution ... The wording [of Article 2 para. 5 of Law no. 141/1975] lacks clarity and creates doubt as to whether the arbitration clause survives the termination of the contract ... and as to the jurisdiction of the arbitration court. In the instant case doubt first arose in the course of the proceedings brought by [the applicants] in the ordinary civil court and again - following the preliminary decision of the Athens Court of First Instance - when those proceedings had been discontinued and recourse was had to arbitration, where diametrically opposed arguments were put forward ... Irrespective of those doubts, the main issue is the acceptance or rejection of the principle of the autonomous character of the arbitration clause and of its scope. For a long time this matter has been the subject of significant differences of opinion in international case-law and among legal writers. In some countries the principle of the survival of the clause to resolve disputes arising prior to the termination of contracts ... prevails. In other countries the dominant view is that termination of the contract entails the annulment of the clause and therefore the referral of all the disputes to the ordinary courts. In other countries again, the accepted view is that the autonomous character of the arbitration clause operates only in respect of certain types of dispute. It was therefore necessary to provide an interpretation of Law no. 141/1975 and that interpretation resolved the problem for the purposes of Greek law by opting for the annulment of arbitration clauses ... and the removal of jurisdiction from the arbitration court. The fact that the intervention of the legislature occurred ... five days before the hearing in the First Division of this Court and following a previous adjournment does not mean that it was not necessary and does not render it contrary to Article 26 paras. 1 and 3 and Articles 77 and 87 of the Constitution. The dispute in question provided the opportunity to resolve a problem which had already arisen. Consequently, it cannot be concluded that, in giving such an interpretation in this case, the legislature interfered with the jurisdiction of the ordinary courts and usurped that jurisdiction. It follows that, contrary to the finding of the First Division, Article 12 para. 1 of Law no. 1701/1987 is not in breach of the Constitution ..."
23. The Court of Cassation remitted the case to the First Division which, on 11 April 1990, quashed the Court of Appeal’s judgment of 4 November 1986 (see paragraph 18 above) and declared void the arbitration award of 27 February 1984 (see paragraph 13 above).
"1. The authentic interpretation of the laws shall rest with the legislative power.
2. A law which is not truly interpretative shall enter into force only as of its publication."
"The courts shall be bound not to apply laws, the contents of which are contrary to the Constitution."
"1. Legislation of higher formal rank enacted before 21 April 1967 pertaining to the protection of foreign capital shall continue to possess such rank and shall be applicable to capital imported henceforth.
2. A single law to be enacted once and for all within three months of the date of the entry into force of this Constitution shall specify the terms and the procedure for the termination or revision of preferential administrative agreements or measures concluded or promulgated between 21 April 1967 and 23 July 1974 pursuant to Legislative Decree no. 2687/1953, in so far as such agreements or measures concern the investment of foreign capital ..."
According to legal writers, the reference in Article 107 of the Constitution to Legislative Decree no. 2687/1953 - which provides, inter alia, that arbitration is to constitute the sole means of resolving disputes concerning foreign investment - confers constitutional status on such arbitration (Introduction to Greek Law, edited by K.D. Kerameus and P.J. Kozyris, Deventer/Athens, Kluwer/Sakkoulas, 1988, p. 263).
"The plaintiff may withdraw the action without the consent of the defendant before the latter has filed pleadings on the merits of the case. He may not so withdraw at a later stage if the defendant objects to the withdrawal on the ground that he has a legitimate interest in the proceedings being concluded by a final decision."
"The effect of the withdrawal of the action is that it shall be deemed never to have been brought ..."
"The arbitrator ... shall, unless stipulated otherwise in the arbitration clause, file the original of the arbitration award with the registry of the Court of First Instance within whose jurisdiction the decision was given ..."
"1. The ordinary remedies do not lie against arbitration awards.
2. The arbitration agreement may specify an appeal against the arbitration award before different arbitrators ..., but it must at the same time define the conditions, the time-limit and the procedure to be followed for the exercise of such a remedy and for the decision thereon."
"If the arbitration agreement does not specify the appeal provided for in Article 895 para. 2 or if the time-limit for filing such an appeal has expired, the arbitration award shall become final ..."
"The arbitration award may be annulled, in whole or in part, only by judicial decision and on the following grounds:
(3) where the arbitrators were designated in breach of the terms of the arbitration agreement or of the statutory provisions ...;
"1. Enforcement may be effected solely pursuant to an enforceable decision.
"1. Enforcement may be effected solely on the basis of the copy of the enforceable decision bearing the stamp conferring authority to execute ...
(d) in respect of arbitration awards by the judge of the First Instance Court ...;
C. Law no. 141/1975 "on ... the revision or revocation of agreements ... concluded during the dictatorship period"
"Following the termination of a contract ... the special privileges and agreements shall cease to have effect and the undertaking or investment shall be subject to the ordinary laws governing ordinary undertakings and investments ..."
27. Stran Greek Refineries and Mr Stratis Andreadis applied to the Commission on 20 November 1987. They maintained that there had been a breach of Article 6 para. 1 (art. 6-1) of the Convention inasmuch as they had not had a fair trial within a reasonable time. They claimed further that as a result of the length and the dilatory nature of the proceedings and of the provisions of Article 12 of Law no. 1701/1987 their right of property guaranteed under Article 1 of Protocol No. 1 (P1-1) had been infringed.
28. The Commission declared the application (no. 13427/87) admissible on 4 July 1991. In its report of 12 May 1993 (Article 31) (art. 31), it expressed the following opinion:
(a) that there had been a violation of Article 6 para. 1 (art. 6-1) of the Convention as regards the right to a fair trial (unanimously), but not as regards the length of the proceedings (twelve votes to two);
(b) that there had been a violation of Article 1 of Protocol No. 1 (P1-1) (unanimously).
"[to declare] the application by Stran Greek Refineries ... inadmissible, on the one hand, and [in addition that there had been] no violation of the rights of the applicants as protected by Article 6 para. 1 (art. 6-1) of the Convention ... and Article 1 of the First Protocol (P1-1)".
"(1) that there has been a violation of Article 6 para. 1 (art. 6-1) as regards the applicants’ right to a fair hearing by a tribunal;
(2) that there has been a violation of Article 6 para. 1 (art. 6-1) as regards observance of the reasonable time requirement;
(3) that there has been and continues to be a breach of Article 1 of Protocol No. 1 (P1-1);
(4) that the respondent State is to pay the applicants ... the amount claimed as just satisfaction".
34. In their memorial to the Court, the Government referred to the following extract from their additional observations of 6 May 1991 on the admissibility of the application: the applicants "chose to pursue their claims under a procedure ... which is not provided for in the Greek legal system - arbitration - and the application is accordingly inadmissible because they have failed to exhaust the statutory remedies available to them in cases of this nature".
35. Such an assertion cannot suffice, in the Court’s view, to sustain the objection raised by the Government at this stage of the proceedings. When a State relies on the exhaustion rule, it must indicate with sufficient clarity the effective remedies to which the applicants have not had recourse; in this area it is not for the Convention bodies to cure of their own motion any shortcomings or lack of precision in respondent States’ arguments (see, among many other authorities, the Barberà, Messegué and Jabardo v. Spain judgment of 6 December 1988, Series A no. 146, p. 27, para. 56).
II. ALLEGED VIOLATIONS OF ARTICLE 6 PARA. 1 (art. 6-1) OF THE CONVENTION
37. The applicants alleged two violations of Article 6 para. 1 (art. 6-1) of the Convention, which provides as follows:
In the first place the adoption of Article 12 of Law no. 1701/1987 and its application in their case by the Court of Cassation had, they maintained, deprived them of a fair trial. Secondly, the length of the proceedings to determine the validity of the arbitration award of 27 February 1984 had exceeded a "reasonable time".
38. At the hearing the Government denied that Article 6 (art. 6) was applicable in the instant case. In their opinion, the subject of the "contestation" (dispute) before the national courts had been the validity of the arbitration clause and consequently that of the arbitration award itself. It had not therefore concerned a "civil right" within the meaning of Article 6 (art. 6). The clause in question had been a privilege accorded within a very specific legislative context and had dealt exclusively with the contractual relations between the military regime and the applicants.
39. According to the Court’s case-law, the concept of "civil rights and obligations" is not to be interpreted solely by reference to the respondent State’s domestic law. Article 6 para. 1 (art. 6-1) applies irrespective of the status of the parties, of the nature of the legislation which governs the manner in which the dispute is to be determined and of the character of the authority which has jurisdiction in the matter; it is enough that the outcome of the proceedings should be decisive for private rights and obligations (see, among many other authorities, the Allan Jacobsson v. Sweden judgment of 25 October 1989, Series A no. 163, p. 20, para. 72).
40. The Court observes that following the termination of the contract concluded between them and the Greek State, the applicants brought an action in the Athens Court of First Instance for a declaration that the State should reimburse them in respect of the expenditure which they had incurred up to that point in connection with the performance of the contract (see paragraph 10 above). Their claim, which was essentially one for damages, was based mainly on the allegation that the State had already been in breach of its obligations under the contract before its termination. Their claim in the arbitration proceedings had a similar basis. The arbitration court allowed the applicants’ claims in part (see paragraph 13 above) by a decision which was final, irrevocable and enforceable both under the terms of the contract itself (Article 27 para. 9 of the contract - see paragraph 10 above) and by virtue of Greek law (Article 904 of the Code of Civil Procedure - see paragraph 25 above).
The Court notes that the applicants’ right under the arbitration award was "pecuniary" in nature, as had been their claim for damages allowed by the arbitration court. Their right to recover the sums awarded by the arbitration court was therefore a "civil right" within the meaning of Article 6 (art. 6), whatever the nature, under Greek law, of the contract between the applicants and the Greek State (see, mutatis mutandis, the Editions Périscope v. France judgment of 26 March 1992, Series A no. 234-B, p. 66, para. 40). It follows that the outcome of the proceedings brought in the ordinary courts by the State to have the arbitration award set aside was decisive for a "civil right".
41. Article 6 para. 1 (art. 6-1) is accordingly applicable.
By enacting and applying in respect of the applicants Article 12 of Law no. 1701/1987, the State had effectively removed jurisdiction from the courts called upon to determine the validity of the arbitration award and prevented any proper judicial investigation of the subject of the dispute. Such an interference was, in the words of the Golder judgment, "indissociable from a danger of arbitrary power" and repugnant to the general principles of international law and the notion of the rule of law inherent in the Convention. The State had determined by legislative action a case in which it was a party. "Legislative legerdemain" had resulted in wholesale inequality of arms in the proceedings in issue.
45. The Government contended that it had been necessary to enact the Law in question on account of the differing opinions of eminent professors of law, contradictory judicial decisions, the formulation of dissenting opinions by judges and the attitude of the parties, who had changed their stances on the validity of the arbitration clause alternately. The growing debate and public policy reasons had thus made it necessary to clarify the intention of the legislature on this question by providing an authoritative interpretation - even twelve years on - of Law no. 141/1975. The democratic legislature had been under a duty to eradicate from public life the residual traces of measures taken by the military regime. Mr Andreadis had been a giant of the economy and the scheme that he had envisaged had at the time been on a huge scale for a country the size of Greece. Moreover, the announcement of the scheme had led, before the fall of the military regime, to one of the largest anti-dictatorship demonstrations.
46. The Court does not question the Government’s intention to act in response to the Greek people’s concern that democratic legality be re-established.
However, by rejoining the Council of Europe on 28 November 1974 and by ratifying the Convention, Greece undertook to respect the principle of the rule of law. This principle, which is enshrined in Article 3 of the Statute of the Council of Europe, finds expression, inter alia, in Article 6 (art. 6) of the Convention. That provision secures in particular the right to a fair trial and sets out in detail the essential guarantees inherent in this notion as applied to criminal proceedings. As regards disputes concerning civil rights and obligations, the Court has laid down in its case-law the requirement of equality of arms in the sense of a fair balance between the parties. In litigation involving opposing private interests, that equality implies that each party must be afforded a reasonable opportunity to present his case - under conditions that do not place him at a substantial disadvantage vis-à-vis his opponent (see the Dombo Beheer B.V. v. the Netherlands judgment of 27 October 1993, Series A no. 274, p. 19, para. 33).
47. In this connection, the Court has had regard to both the timing and manner of the adoption of Article 12 of Law no. 1701/1987. Shortly before the hearing in the Court of Cassation, which had initially been set down for 4 May 1987, and after the parties had received the opinion of the judge-rapporteur recommending the dismissal of the State’s appeal, the State sought the adjournment of the hearing on the ground that a draft law concerning the case was before Parliament (see paragraph 19 above).
This draft law was adopted on 22 May 1987 and entered into force on 25 May after its publication in the Official Gazette (see paragraph 20 above). The hearing was held on 1 June (see paragraph 19 above). Moreover, while Law no. 1701/1987 was principally concerned with the renegotiation of the terms of a contract relating to the prospecting for and extraction of oil and gas - likewise concluded during the dictatorship between the State and companies other than Stran -, Article 12 was an additional provision to that law and was in reality aimed at the applicant company - although the latter was not mentioned by name (see paragraph 20 above).
It is nevertheless an inescapable fact that the legislature’s intervention in the present case took place at a time when judicial proceedings in which the State was a party were pending.
The principle of the rule of law and the notion of fair trial enshrined in Article 6 (art. 6) preclude any interference by the legislature with the administration of justice designed to influence the judicial determination of the dispute. The wording of paragraphs 1 and 2 of Article 12 taken together effectively excluded any meaningful examination of the case by the First Division of the Court of Cassation. Once the constitutionality of those paragraphs had been upheld by the Court of Cassation in plenary session, the First Division’s decision became inevitable.
50. In conclusion, the State infringed the applicants’ rights under Article 6 para. 1 (art. 6-1) by intervening in a manner which was decisive to ensure that the - imminent - outcome of proceedings in which it was a party was favourable to it. There has therefore been a violation of that Article (art. 6-1).
51. It remains to establish whether, as the applicants maintained, a "reasonable time" was exceeded.
53. In their memorial, the Government argued that the "time" to be considered should cover only the total of the periods that elapsed between each hearing and each judgment - approximately two years and two and a half months - because, on account of the nature of the questions in dispute, each court which gave a decision no longer had jurisdiction to pursue the consideration of the case. At the hearing the Delegate of the Agent maintained that the relevant period had ended on 20 November 1987, when the applicants applied to the European Commission. The part of the cassation proceedings that was at issue had been conducted after that date.
55. The reasonableness of the length of proceedings is to be determined with reference to the criteria laid down in the Court’s case-law and in the light of the circumstances of the case, which in this instance call for an overall assessment.
The proceedings in the Athens Court of First Instance and the Athens Court of Appeal lasted eighteen months, about six of which were prior to the Greek declaration under Article 25 (art. 25) of the Convention. These proceedings are not open to criticism. The proceedings in the Court of Cassation lasted more than three years, a period that is justified in view of the need to take account of Law no. 1701/1987, and above all the fact that Article 563 para. 2 of the Code of Civil Procedure requires a division of the Court of Cassation to refer a case to the plenary court if it refuses to apply a law on the ground that it is unconstitutional (see paragraph 21 above in fine).
56. It follows that on this point there has been no violation of Article 6 para. 1 (art. 6-1).
57. The applicants also claimed to be victims of a breach of Article 1 of Protocol No. 1 (P1-1), which is worded as follows:
1. Whether there was a "possession" within the meaning of Article 1 (P1-1)
58. The principal thrust of the Government’s argument was that no "possession" of the applicants, within the meaning of Article 1 of Protocol No. 1 (P1-1), had been subject to interference through the operation of Law no. 1701/1987.
In particular with regard to the arbitration award, an invalid procedure could not produce valid effects. The applicants had known perfectly well that the award would be a precarious legal basis for their financial claims until the question of its validity had been irrevocably settled. Judgment no. 5526/85 of the Athens Court of First Instance (see paragraph 16 above) and judgment no. 9336/86 of the Athens Court of Appeal (see paragraph 18 above), which had initially found in favour of the applicants, were subject to review by the Court of Cassation and, before the latter court’s final decision, could not form the basis of reasonable expectations concerning the right of property. Furthermore the applicants had themselves chosen to institute proceedings in the ordinary civil courts and had strenuously opposed the jurisdiction of the arbitration court.
Finally, the Government contended that the Strasbourg institutions should not themselves carry out an assessment of the applicants’ complaints without having regard to all the arguments of the parties and their attitude before the arbitration court. The State had not recognised that there was any basis for Stran’s alleged claim, the merits of which it had consistently disputed, first in the Athens Court of First Instance and then before the arbitration court. Even the proceedings to have the award set aside had of necessity entailed an indirect but implicit challenge to the merits of the decision.
59. In order to determine whether the applicants had a "possession" for the purposes of Article 1 of Protocol No. 1 (P1-1), the Court must ascertain whether judgment no. 13910/79 of the Athens Court of First Instance and the arbitration award had given rise to a debt in their favour that was sufficiently established to be enforceable.
60. In the nature of things, a preliminary decision prejudges the merits of a dispute by ordering an investigative measure. Although the Athens Court of First Instance would appear to have accepted the principle that the State owed a debt to the applicants - as the Commission likewise noted -, it nevertheless ordered that witnesses be heard (see paragraph 11 above) before ruling on the existence and extent of the alleged damage. The effect of such a decision was merely to furnish the applicants with the hope that they would secure recognition of the claim put forward. Whether the resulting debt was enforceable would depend on any review by two superior courts.
61. This is not the case with regard to the arbitration award, which clearly recognised the State’s liability up to a maximum of specified amounts in three different currencies (see paragraph 13 above).
62. At the moment when Law no. 1701/1987 was passed the arbitration award of 27 February 1984 therefore conferred on the applicants a right in the sums awarded. Admittedly, that right was revocable, since the award could still be annulled, but the ordinary courts had by then already twice held - at first instance and on appeal - that there was no ground for such annulment. Accordingly, in the Court’s view, that right constituted a "possession" within the meaning of Article 1 of Protocol No. 1 (P1-1).
63. In the applicants’ submission, although no property was transferred to the State, the combined effect of paragraphs 2 and 3 of Article 12 resulted in a de facto deprivation of their possessions because the result was literally to cancel the debt arising out of a final and binding arbitration award.
64. The Commission considered this to be an infringement of the right to the peaceful enjoyment of possessions within the meaning of the first sentence of the first paragraph of Article 1 of Protocol No. 1 (P1-1).
65. The Government accepted neither of these views. They maintained that paragraph 2 of Article 12 merely described an inevitable consequence of paragraph 1 and had no independent meaning. In this connection they cited their arguments in relation to Article 6 (art. 6) of the Convention (see paragraph 48 above), affirming more specifically that paragraph 2 of Article 12 had no autonomous existence because it presupposed judicial examination of the nullity referred to in paragraph 1 and merely set out the evident consequences of such nullity. The Government added that paragraph 3 introduced a measure whose constitutionality had not been assessed by the national courts, before which an action brought by the applicants was still pending, and that a new action was always possible if the applicants’ withdrawal from the first one led to its discontinuance (see paragraph 17 above). However, in the latter situation the applicants would encounter the problem of failure to exhaust domestic remedies.
66. The Court finds that there was an interference with the applicants’ right of property as guaranteed by Article 1 of Protocol No. 1 (P1-1). Paragraph 2 of Article 12 of Law no. 1701/1987 declared the arbitration award void and unenforceable. Paragraph 3 provided that any claim against the State arising from contracts like those concluded by the applicants was statute-barred. Admittedly the Court of Cassation left open the question of the constitutionality of paragraph 3 and the applicants theoretically have the possibility, as the Government argued, of pursuing their 1978 action or bringing a new one. However, the prospects of success of such a step appear minimal. Indeed the question arises whether a first-instance court would go so far as to hold this paragraph to be unconstitutional on the basis of general and abstract provisions of the Constitution (see paragraph 31 in fine above), in the light in particular of the plenary Court of Cassation’s decision of 16 March 1989 concerning paragraphs 1 and 2 of Article 12 (see paragraph 22 above). Both that decision and the judgment of the Court of Cassation of 11 April 1990 (see paragraph 23 above) had the effect of closing the proceedings in issue once and for all, which was the real objective of the legislature in enacting Article 12. This may be seen from the actual wording of paragraph 4, which was intended to bring to a conclusion the sole dispute of this nature pending before the courts at the time, namely that between the applicants and the State, and from the wording of paragraph 3, which was designed to exclude any future action.
In conclusion, there was an interference with the applicants’ property right.
68. The interference in question was neither an expropriation nor a measure to control the use of property; it falls to be dealt with under the first sentence of the first paragraph of Article 1 (P1-1).
69. The Court must therefore determine whether a fair balance was struck between the demands of the general interest of the community and the requirements of the protection of the individual’s fundamental rights (see the Sporrong and Lönnroth v. Sweden judgment of 23 September 1982, Series A no. 52, p. 26, para. 69).
70. According to the Government, Laws nos. 141/1975 and 1701/1987 pursued a public interest aim which in the specific context was of much broader significance than the mere elimination of the economic consequences of the dictatorship. These laws were part of a body of measures designed to cleanse public life of the disrepute attaching to the military regime and to proclaim the power and the will of the Greek people to defend the democratic institutions. The applicants’ complaints derived from a preferential contract, prejudicial to the national economy, which had helped to sustain the regime and to give the impression at national and international level that it had the support of eminent figures from the Greek business world. The period that had elapsed between the restoration of democracy and the enactment of Law no. 1701/1987, the State’s decision to opt for arbitration - a step of a purely technical nature - and the fact that Stran’s claims related solely to the reimbursement of its expenses were immaterial.
71. The applicants did not contest the Government’s assertion that the brutal practices of the military regime weighed more heavily on the scales of public interest than claims based on transactions concluded with that regime. However, the public interest that the Court was called upon to assess in the case before it was a different one. It would be unjust if every legal relationship entered into with a dictatorial regime was regarded as invalid when the regime came to an end. Moreover, the contract in question related to the construction of an oil refinery, which was of benefit to the economic infrastructure of the country.
73. In this connection, the Court notes that the Greek legal system recognises the principle that arbitration clauses are autonomous (see paragraph 18 above) and that the Athens Court of First Instance (see paragraph 16 above), the Athens Court of Appeal (see paragraph 18 above) and, it would appear, the judge-rapporteur of the Court of Cassation (see paragraph 19 above) applied this principle in the present case. Moreover the two courts found that the applicants’ claims originating before the termination of the contract were not invalidated thereby.
75. There has accordingly been a violation of Article 1 of Protocol No. 1 (P1-1).
76. Under Article 50 (art. 50) of the Convention,
77. The applicants argued that only the payment in full of the amount awarded by the arbitration decision could achieve the restitutio in integrum required by Article 50 (art. 50).
They therefore claimed as pecuniary damage that amount ("the principal sum") plus interest at a flat rate of 6% - which they maintained had been included in the arbitration award - from 10 November 1978 to the date of violation, making a total of 175,869,155.78 drachmas, 24,282,694.28 US dollars and 929,652.81 French francs. They also sought interest on the amount awarded as pecuniary damage, from the date of violation to the date of the Court’s judgment.
In the alternative, they claimed as pecuniary damage the principal sum plus interest at a flat rate of 6% from 10 November 1978 to the date of the Court’s judgment. At the date of the hearing before the Court, interest on the principal amounted to approximately 106,898,000 drachmas, 14,790,000 US dollars and 567,000 French francs.
78. The Government contended that the applicants were not entitled to any compensation under Article 50 (art. 50) because they could obtain satisfaction through the domestic remedies available. Even supposing that the application of Article 12 of Law no. 1701/1987 had infringed the applicants’ right to a fair trial, it in no way affected their financial claims. The annulment of the award did not prevent them from continuing their 1978 action or from bringing a new action.
If, on the other hand, the Court found a breach of Article 1 of Protocol No. 1 (P1-1), that finding would constitute sufficient just satisfaction; under no circumstances should such satisfaction exceed one million drachmas for non-pecuniary damage.
Finally, the Government contested the applicants’ claims for interest. Relying on the Greek legislation and settled case-law to this effect, they affirmed that neither judgment no. 13910/1987 nor the arbitration award could give rise to the payment of interest because they were declaratory in nature. More specifically the reference to 6% interest appeared only in the grounds of the award (see paragraph 13 above) and was a mere obiter dictum of a wholly erroneous nature. The arbitration court did not repeat it in the operative part of its decision and with good reason. No such claim had been made before it and as the matter had been referred to arbitration by the State the arbitrators could not have ordered the latter to pay interest.
79. The Delegate of the Commission stressed firstly that Article 50 (art. 50) required just satisfaction and not necessarily complete satisfaction. He also drew attention to the fact that the sums mentioned in the award had not been examined by the domestic courts. He invited the Court to subject the sums sought to careful scrutiny.
80. The Court reiterates that it affords "just satisfaction" only "if necessary", without being bound in this respect by domestic legal rules (see the Sunday Times v. the United Kingdom (no. 1) judgment of 6 November 1980, Series A no. 38, p. 9, para. 15).
81. It observes that the operative part of the arbitration award declared Stran’s claims against the State unfounded in so far as they exceeded 116,273,442 drachmas, 16,054,165 US dollars and 614,627 French francs. Having regard to its finding at paragraph 75, the Court concludes that the applicants are entitled to the reimbursement of these sums.
83. The applicants’ claim should accordingly be allowed in part and they should be awarded 6% simple interest on the above-mentioned sums (see paragraph 81 above) for the period running from 27 February 1984 to the date of judgment.
On the other hand, they sought the reimbursement of the costs and expenses incurred before the Convention organs in the amount of £171,041 sterling, plus interest on that sum for the period between the date of the Court’s judgment and the actual payment.
A week after the hearing of 19 April 1994, the applicants’ lawyers submitted to the Court a claim for a further £34,709.05 sterling in respect of additional costs incurred between the date on which their memorial was filed and that of the hearing.
In the present case, it finds no trace in the applicants’ memorial or in the verbatim report of the hearing of the additional claim or even of an intention to submit such a claim after the hearing. It therefore dismisses it as out of time.
Making an assessment on an equitable basis and with reference to the criteria that it applies in this field, the Court considers it appropriate to reduce the sum set out in the applicants’ initial claim. It awards them £125,000 sterling, no interest being payable on that amount.
2. Holds that Article 6 para. 1 (art. 6-1) of the Convention applies in this case;
3. Holds that there has been a breach of Article 6 para. 1 (art. 6-1) of the Convention as regards the right to a fair trial;
4. Holds that there has been no breach of Article 6 para. 1 (art. 6-1) of the Convention as regards the length of the proceedings;
5. Holds that there has been a breach of Article 1 of Protocol No. 1 (P1-1);
* The case is numbered 22/1993/417/496. The first number is the case's position on the list of cases referred to the Court in the relevant year (second number). The last two numbers indicate the case's position on the list of cases referred to the Court since its creation and on the list of the corresponding originating applications to the Commission.
* Note by the Registrar. For practical reasons this annex will appear only with the printed version of the judgment (volume 301-B of Series A of the Publications of the Court), but a copy of the Commission's report is obtainable from the registry.
STRAN GREEK REFINERIES AND STRATIS ANDREADIS v. GREECE JUDGMENT