FIRST SECTION
 
 
 
 
 
 
CASE OF CENTRE FOR THE DEVELOPMENT OF ANALYTICAL PSYCHOLOGY v. THE FORMER YUGOSLAV REPUBLIC OF MACEDONIA
 
(Applications nos. 29545/10 and 32961/10)
 
 
 
 
 
 
 
 
 
 
JUDGMENT
 
 
STRASBOURG
 
15 June 2017
 
 
FINAL
 
15/09/2017
 
This judgment has become final under Article 44 § 2 of the Convention. It may be subject to editorial revision. In the case of Centre for the Development of Analytical Psychology v. the former Yugoslav Republic of Macedonia,
The European Court of Human Rights (First Section), sitting as a Chamber composed of:
 Linos-Alexandre Sicilianos, President,
 Kristina Pardalos,
 Aleš Pejchal,
 Krzysztof Wojtyczek,
 Armen Harutyunyan,
 Tim Eicke,
 Jovan Ilievski, judges,
and Renata Degener, Deputy Section Registrar,
Having deliberated in private on 16 May 2017,
Delivers the following judgment, which was adopted on that date:
PROCEDURE
1. The case originated in two applications (nos. 29545/10 and 32961/10) against the former Yugoslav Republic of Macedonia lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (“the Convention”) by the Centre for the Development of Analytical Psychology Ltd (“the applicant company”) on 19 May 2010 and 28 May 2010 respectively. The applicant company is a limited liability company incorporated in Skopje, owned and managed by Dr Marija Arsovska, a psychiatrist. 2. The applicant company was represented by Ms. P. Zefik, a lawyer practising in Skopje. The Macedonian Government (“the Government”) were represented by their Agent, Mr K. Bogdanov. 3. The applicant company complained, in particular, of a lack of access to a court concerning its claims related to a contract with the State Health Insurance Fund. It relied on Article 6 § 1 of the Convention. 4. On 5 January 2015 the above complaint was communicated to the Government. THE FACTS
I. THE CIRCUMSTANCES OF THE CASE
A. Background information to the case
5. In 1995 Dr Marija Arsovska, a psychiatrist whose name at the time was Marija Karanfilova (“the psychiatrist”), established a private practice called Dr Marija Karanfilova’s Independent Psychiatric Practice (Самостојна специјалистичка ординација по невропсихијатрија „Д-р Марија Каранфилова„ – “the Practice”) where she treated people using Carl Jung’s analytical psychotherapy methods. The Practice was assigned an individual tax number beginning with the numbers 503. 6. In 2004 the Practice signed a contract with the State Health Insurance Fund (“the Fund”) on the funding of treatment provided by the Practice to health insurance beneficiaries. 7. On 15 February 2006 the Ministry of Health’s State Sanitation and Health Inspectorate (“the Inspectorate”) conducted an on-site inspection (инспекциски надзор). It ordered the Practice to re-register as a private health institution in order to comply with amendments to the Health Protection Act of 2004 (Закон за изменување и дополнување на Законот за здравствена заштита, Official Gazette no. 10/04). 8. In compliance with the Inspectorate’s orders, the psychiatrist applied to the Ministry of Health to have the Practice re-registered and to change its name, as required by the new statutory provisions. 9. On 28 February 2006 the Ministry of Health issued a decision on the registration of the Private health institution Dr Marija Karanfilova’s Specialist Psychiatric Practice (Приватна здравствена установа – специјалистичка ординација по невропсихијатрија „Д-р Марија Каранфилова„ – “the new Practice”) at the same address as the previous Practice. It stated that the 1995 registration decision relating to the original Practice would no longer be in force (ќе престане да важи) after the new decision had been entered into the relevant register. The decision was delivered to several institutions, including the Fund. 10. The Inspectorate conducted a fresh on-site inspection on 6 March 2006. It concluded that the Practice had fully complied with its decision of 15 February 2006, including the instructions for re-registration. 11. On 17 April 2006 the Central Registry recorded the registration of the new Practice as of 29 March 2006. It was given a new individual tax number, beginning with the numbers 403. 12. On 6 June 2006 the new Practice notified the Fund about the changes in its registration, including the change of its name. 13. On 29 November 2006 the Fund notified the new Practice that it did not intend to sign a new contract after the expiry of the previous one. 14. On 2 August 2007, on the basis of a request by the new Practice, the Central Registry allowed the new Practice to change from being a private health institution to one that was a limited liability company established by a single person (ДООЕЛ) and entered that transformation in its records. The applicant company was known officially as the Centre for the Development of Analytical Psychology Ltd. (Центар за развој на аналитичка психологија – ДООЕЛ). It kept the same tax number as the new Practice. The link between the new Practice and the applicant company was not disputed in the impugned proceedings (see below). B. Compensation proceedings against the Fund (Пс.бр.2229/07)
15. On 25 January 2006 the Practice initiated compensation proceedings against the Fund in the Skopje Court of First Instance (Основен суд Скопје) for non-adherence to the terms of the contract. Both the new Practice and the applicant company continued the proceedings as the claimant. 16. On 10 June 2008 the first-instance court granted the claim in part. 17. On 26 August 2008 the Fund lodged an appeal against the first‑instance judgment, objecting to the applicant company’s standing in the proceedings for the first time. It argued that the claimant was a different legal entity than the one which had signed the contract with the Fund in 2004, as evident in the two entities’ different individual tax numbers. 18. The applicant company submitted in reply that the re-registration of the Practice had been carried out in compliance with the Inspectorate’s orders and that the Fund had been aware of the changes. It also argued that the Fund had implicitly recognised the legal continuity of the two entities as it had accepted reports submitted by the new Practice under the contract of 2004 and had given notice of the termination of the contract to the new Practice. 19. The Skopje Court of Appeal (Апелационен суд Скопје) on 28 January 2009 granted the Fund’s appeal and remitted the case for fresh consideration. 20. On 10 April 2009 the Skopje Court of First Instance dismissed the applicant company’s claim, finding that it had no standing in the proceedings (нема активна легитимација во спорот). It established that the contract had been signed by the Fund and Dr Marija Karanfilova’s Independent Psychiatric Practice and that the applicant company could not be considered as the Practice’s legal successor as they had different individual tax numbers. 21. The applicant company appealed, complaining that the first-instance court had disregarded the evidence that had shown the existence of a legal relationship between the parties and had based its assessment solely on the different tax numbers. In particular, the first-instance court had disregarded the fact that the new Practice had continued to perform its contractual obligations until the contract had been terminated by the notice of 29 November 2006 (see paragraph 13 above). The applicant company maintained that those circumstances indicated that the Fund had implicitly recognised the legal continuity of the original and the new Practice. The applicant company alleged that the formalistic approach of the first-instance court had meant its claim had remained undecided on the merits. 22. On 2 December 2009 the Skopje Court of Appeal dismissed the applicant company’s appeal and upheld the first-instance judgment. C. Civil proceedings for debt against the Fund (Пс.бр.2644/07)
23. On 7 July 2006 the new Practice lodged a civil claim against the Fund for the payment of an undetermined sum for failing to adhere to the terms of the contract of 2004. After the new Practice turned itself into the applicant company (see paragraph 14 above) the latter continued the proceedings as the claimant. 24. At a hearing held on 27 June 2008 the Fund raised an objection that the applicant company lacked standing in the proceedings. 25. On 16 February 2009 the Skopje Court of First Instance dismissed the applicant company’s claim, finding that it had no standing in the proceedings. The first-instance court relied in its reasoning on the difference in the tax numbers between the original Practice that had been party to the contract with the Fund in 2004 and the applicant company. 26. On 11 December 2009 the Skopje Court of Appeal dismissed an appeal by the applicant company and upheld the first-instance judgment. It stressed that a tax number was a unique attribute of a particular entity and would remain unchanged, regardless of any structural or other changes to the entity. II. RELEVANT DOMESTIC LAW AND PRACTICE
A. Tax Proceedings Act of 2006
27. Section 36 of the Tax Proceedings Act (Закон за даночна постапка, Official Gazette no. 13/2006) concerning individual tax numbers reads:
“1. The Public Revenue Office assigns an individual tax number (единствен даночен број) to identify the taxpayer in the course of tax proceedings. 2. The individual tax number is the tax payer’s sole identification number for all types of public revenue and is maintained until the termination of tax payer status. 3. The individual tax number is used throughout the tax proceedings and must be included in all written correspondence and documents.”
B. Civil Procedure Act of 2005
28. At the relevant time, section 469(1) of the Civil Procedure Act (Закон за парничната постапка, Official Gazette no. 79/2005) concerning the admissibility criterion ratione valoris in commercial disputes for appeals on points of law before the Supreme Court set out the following:
“An appeal on points of law against a final second-instance judgment is admissible in commercial disputes if the value of the challenged part of the second-instance judgment is higher than 1,000,000 Macedonian denars (MKD).”
29. Section 400 of the Civil Procedure Act of 2005 sets out the conditions for requesting the reopening of domestic proceedings following a finding by the European Court of Human Rights of a violation of a human right or fundamental freedom guaranteed by the Convention. It provides as follows:
“(1) When the European Court of Human Rights has found a violation of a human right or fundamental freedom guaranteed by the Convention for the Protection of Human Rights and Fundamental Freedoms or additional protocols thereto ratified by the Republic of Macedonia, a party may, within thirty days of the judgment of the European Court of Human Rights becoming final, file a petition with the court in the Republic of Macedonia which adjudicated in the first instance in the proceedings in which the decision violating the human right or fundamental freedom was rendered, to set aside the decision by which the human right or fundamental freedom was violated. (2) The proceedings referred to in paragraph 1 of this section shall be conducted by applying, mutatis mutandis, the provisions on the reopening of proceedings. (3) In the reopened proceedings the courts are required to respect the legal opinions expressed in the final judgment of the European Court of Human Rights finding a violation of a fundamental human right or freedom.”
C. Companies Act of 2004
30. Section 19 of the Companies Act (Закон за трговските друштва, Official Gazette no. 28/2004) defines a company as a legal entity in which one or more persons invest money, contributions in kind or rights in assets, used for joint operation and where such persons jointly share the profit or loss from such operation. D. Relevant practice of the Supreme Court
31. In a separate set of civil proceedings between the applicant company and the Fund, concerning the same contract of 2004 and which ratione valoris reached the Supreme Court, an appeal by the applicant company on points of law was granted and the case was remitted for fresh consideration. The Supreme Court found that in the particular circumstances of the case the lower courts had incorrectly established that the applicant company had no standing in the proceedings. The lower courts had disregarded the fact that the impugned contract had been terminated by the Fund’s notice of 29 November 2006 to the new Practice, which had had the same tax number as the applicant company. The court found that it could not be considered therefore that there had been no legal continuity between the entities (Supreme Court judgment of 30 November 2011, Рев1.бр.74/2011). THE LAW
I. JOINDER OF THE APPLICATIONS
32. The applicant company complained in both applications that its claims concerning the contract with the Fund had remained undecided on the merits owing to the domestic courts’ findings that it had lacked standing in the proceedings. Having regard to the similarity of the complaints and the underlying facts giving rise to the grievances, the Court considers that the applications should be joined, in accordance with Rule 42 § 1 of the Rules of Court. II. ALLEGED VIOLATION OF ARTICLE 6 OF THE CONVENTION
33. The applicant company submitted that the dismissal of its claims by the domestic courts for lack of standing in the proceedings had infringed its right of access to a court under Article 6 § 1 of the Convention, the relevant part of which provides:
“In the determination of his civil rights and obligations ... everyone is entitled to a fair ... hearing ... by [a] ... tribunal ...”
A. Admissibility
34. The Court notes that the applicant company’s 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. B. Merits
1. The parties’ submissions
(a)  The applicant company
35. The applicant company maintained that the domestic courts had not taken its submissions concerning the different entities’ legal continuity into account, although it had submitted all the relevant documents in the proceedings. It noted that the purpose of the individual tax number was to identify a legal entity in tax proceedings and that it could not be used to determine the legal continuity of two entities in the sphere of private relations between individuals. The applicant company submitted that the Fund had recognised the two entities’ legal continuity (that of the Practice and the new Practice) as the contract of 2004 had been prolonged to the end of 2006 and the Fund had waited until 29 November 2006 to notify the new Practice that it did not intend to sign a new contract after the expiry of the old one. During that period the Fund had accepted payments made by the new Practice and had not opposed it fulfilling the obligations of the 2004 contract. In that connection, the applicant company noted that the provisions of the Obligations Act regulating subrogation by law (section 289) or debt takeover (section 434(3)) were applicable to the facts of the case. 36. The applicant company rejected the Government’s assertion that the Practice should have transferred its existing claims to the new Practice through cession contracts, as provided by the Obligations Act. It noted that the Practice had been re-registered on the orders of the Inspectorate and that there had been nothing to suggest that the re-registration proceedings would involve the formation of a new legal entity. Lastly, the applicant company reiterated that it had been established in a separate set of proceedings, involving the same parties and which had reached the Supreme Court ratione valoris, that the applicant company had standing in the proceedings. (b)  The Government
37. The Government argued that there had been no violation of the applicant company’s right of access to a court guaranteed under Article 6 of the Convention. They submitted that although the applicant company had been given the opportunity to submit evidence in favour of its claims before the domestic courts, it had failed to prove that the new Practice had been the legal successor to the original Practice, even though it had had a different tax number. The fact that the applicant company had failed to prove its allegations in the domestic courts could not be considered as a violation of the right of access to a court, as guaranteed under the Convention. 38. The Government noted that under the Tax Proceedings Act legal entities were assigned an individual tax number. The individual tax number served to identify the entity and also ensured the principle of legal certainty in relations between private individuals, such as debtors and creditors. The Government further stated that the Obligations Act allowed the transfer of claims between legal entities (cession contracts), without requiring the debtor’s consent. If the applicant company had availed itself of that opportunity then it would not have faced any difficulties in securing its claims before the domestic courts. 2. The Court’s assessment
(a)  General principles
39. The Court has held on many occasions that Article 6 § 1 embodies the “right to a court”, of which the right of access, that is, the right to institute proceedings before a court, constitutes one aspect only; however, it is that aspect which enables an individual to benefit from the further guarantees laid down in paragraph 1 of Article 6. The fair, public and expeditious characteristics of judicial proceedings are indeed of no value at all if such proceedings are not first initiated. And in civil matters one can scarcely conceive of the rule of law without there being a possibility of having access to the courts (see, among many other authorities, Golder v. the United Kingdom, 21 February 1975, § 34 and 35-36, Series A no. 18; Z and Others v. the United Kingdom [GC], no. 29392/95, §§ 91-93 ECHR 2001‑V; and Kreuz v. Poland, no. 28249/95, § 52, ECHR 2001‑VI). 40. The right of access to court is not absolute and it may be subject to limitations (see Lupeni Greek Catholic Parish and Others v. Romania [GC], no. 76943/11, § 89, 29 November 2016; see also Stanev v. Bulgaria [GC], no. 36760/06, § 230, ECHR 2012; and Peruško v. Croatia, no. 36998/09, § 45, 15 January 2013). 41. Nonetheless, the limitations applied must not restrict or reduce the access left to the individual in such a way or to such an extent that the very essence of the right is impaired. Furthermore, a limitation will not be compatible with Article 6 § 1 if it does not pursue a legitimate aim and if there is not a reasonable relationship of proportionality between the means employed and the aim sought to be achieved (see, for instance, Baka v. Hungary [GC], no. 20261/12, § 120, ECHR 2016). 42. In this connection the Court reiterates that, in accordance with Article 19 of the Convention, its duty is to ensure the observance of the obligations undertaken by the Contracting Parties to the Convention. In particular, it is not its function to deal with errors of fact or law allegedly committed by a national court, unless and in so far as they may have infringed the rights and freedoms protected by the Convention (see, among other authorities, Lupeni Greek Catholic Parish and Others, cited above, § 90 and Běleš and Others v. the Czech Republic, no. 47273/99, § 48, ECHR 2002‑IX). (b)  Application of those principles to the present case
43. The Court notes that two sets of domestic proceedings were initiated against the Fund for non-adherence to the terms of the impugned contract of 2004. The claim in the first set of proceedings was lodged by the original Practice and in the second set by the new Practice. The applicant company became the claimant after it was registered in 2007. The Court observes that both the original and the new Practice were legal entities owned and managed by the same psychiatrist, had the same address and a specific professional field of activity (analytical psychotherapy based on the principles of Carl Jung). The only difference between the two entities was a minor amendment to the entity’s official name (following the re-registration procedure) and their individual tax number. 44. The Court also notes that in both sets of proceedings the applicant company’s claims were dismissed for lack of standing. In reaching their conclusion the domestic courts relied solely on the difference in the two entities’ individual tax numbers. Both sets of proceedings ended before the second-instance courts since the value of the claims fell below the statutory threshold for lodging an appeal on points of law with the Supreme Court (see paragraph 28 above). As a result, the applicant company’s claims of the Fund’s non-adherence to the terms of the contract were never examined on the merits. 45. The applicant company complains that its right of access to a court was unjustifiably restricted by the domestic courts’ finding that it lacked legal standing to claim compliance with the impugned contract. The Court thus needs to consider whether what is at stake in the present case is a procedural obstacle related to the legal standing of the claimant that prevented the domestic courts from examining the merits of the disputes or rather a substantive limitation on a right existing under domestic law (see, by contrast, Lupeni Greek Catholic Parish and Others, cited above, § 99). In doing so, the Court reiterates that the fact that the applicant was able to bring an action in the domestic courts does not necessarily satisfy the requirements of Article 6 § 1 of the Convention (see Yagtzilar and Others v. Greece, no. 41727/98, § 26, ECHR 2001‑XII and Kardoš v. Croatia, no. 25782/11, § 48, 26 April 2016). That Article secures everyone the right to have any claim relating to his civil rights and obligations brought before a court or tribunal. In this way it embodies the “right to a court”, which, according to the Court’s case-law, includes not only the right to institute proceedings but also the right to obtain a “determination” of the dispute by a court (see, among other authorities, Lupeni Greek Catholic Parish and Others, cited above, § 86; see also Kutić v. Croatia, no. 48778/99, § 25, ECHR 2002‑II and Menshakova v. Ukraine, no. 377/02, § 52, 8 April 2010). Accordingly, in the case at hand, the Court will examine whether the domestic courts’ refusal to determine the substance of the applicant company’s disputes owing to their finding that it lacked legal standing unjustifiably restricted its right of access to a court. 46. In that respect, the Court notes that it is not its task to interpret domestic law, since this is in the first place for the national authorities, and notably the courts (see, among other authorities, Freitag v. Germany, no. 71440/01, § 36, 19 July 2007, and Askon AD v. Bulgaria, no. 9970/05, § 28, 16 October 2012). While it can accept the Government’s argument that assigning an identification code to legal entities (such as the individual tax number) is a measure aimed at ensuring legal certainty, which can be seen as a legitimate aim, the Court is struck by the fact that the Supreme Court found, in nearly identical circumstances involving the same parties and the same contract, that the applicant company had standing to sue in the proceedings since the impugned contract had been terminated by the notice of 29 November 2006 given to the new Practice (see paragraph 31 above). In view of that, the Court sees no reason, and none was offered by the Government, to depart from the conclusion of the highest domestic court. 47. The foregoing considerations are sufficient to enable the Court to conclude that in the particular circumstances of the case the domestic courts imposed an unjustifiable procedural obstacle on the applicant company by adopting an excessively formalistic approach and dismissing its claims for lack of standing. This impaired the very essence of the applicant company’s right of access to a court and left it no opportunity to have its claims examined on the merits. 48. III. ALLEGED VIOLATION OF ARTICLE 1 OF PROTOCOL NO.1 OF THE CONVENTION
49. The applicant company complained that its right to the peaceful enjoyment of its possessions had been violated. It relied on Article 1 of Protocol No.1 of the Convention, which reads as follows:
“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.”
50. Having regard to its findings concerning Article 6 § 1 of the Convention, the Court considers that it cannot speculate as to whether the applicant company had any rights arising from the contract with the Fund. In this connection the Court notes that the applicant company now has an opportunity to request the reopening of the proceedings in accordance with the relevant domestic law (see paragraph 29 above), which will allow for a fresh examination of its claims. In those circumstances the Court finds that this complaint is not ready for consideration at this stage and should be rejected in accordance with Article 35 §§ 3 and 4 of the Convention (see Biondić v. Croatia, no. 38355/05, § 31, 8 November 2007, and Jaćimović v. Croatia, no. 22688/09, § 55, 31 October 2013).

Outcome for Article 6: violation