FIFTH SECTIONCASE OF TSENTR “UKRASA” v. UKRAINE(Application no. 2836/10)    JUDGMENT This version was rectified on 6 December 2021 under Rule 81 of the Rules of Court. STRASBOURG25 November 2021 This judgment is final but it may be subject to editorial revision.In the case of Tsentr “Ukrasa” v. Ukraine,The European Court of Human Rights (Fifth Section), sitting as a Committee composed of: Stéphanie Mourou-Vikström, President, Ganna Yudkivska, Lado Chanturia, judges,and Martina Keller, Deputy Section Registrar,Having regard to:the application (no. 2836/10) against Ukraine lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (“the Convention”) by Tsentr “Ukrasa” (“the applicant company”) on 30 December 2009;the decision to give notice to the Ukrainian Government (“the Government”) of the complaint of a breach of legal certainty, and to declare the remainder of the application inadmissible;the parties’ observations;Having deliberated in private on 4 November 2021,Delivers the following judgment, which was adopted on that date:INTRODUCTION1.  The present application concerns the issue of res judicata. The applicant company complained under Article 6 of the Convention that the national courts had considered the same claim involving the same parties twice.THE FACTS2.  The applicant company, Tsentr “Ukrasa”, is a privately owned company, incorporated under the laws of Ukraine. It was represented before the Court by Mr L.S. Voloshyn, a lawyer practising in Rivne.3.  The Ukrainian Government (“the Government”) were represented by their Agent, Mr I. Lishchyna.4.  The facts of the case, as submitted by the parties, may be summarised as follows.5.  On 15 June 2004 the Bailiffs Service entered into a contract with a specialised State enterprise, U.Y., which delegated to the latter the sale at a public auction of an unfinished building situated in Rivne, Ukraine (hereinafter “the building”) that the Bailiffs Service had seized. The property belonged to the R.A.S., a subsidiary company of an open joint‑stock company (“the OJSC”). It had been seized pursuant to an order issued by the Bailiffs Service on 16 April 2004. The sale of the property was intended to cover the R.A.S.’s debts.6.  On 2 July 2004 U.Y. conducted the public auction, and the applicant company purchased the building.7.  On the same day, the Bailiffs Service issued the applicant company with a certificate of purchase for the building, and a private notary issued it with title to the building.8.  On 23 February 2005 the OJSC sold the building to the private company K., which, in its turn, sold it to the private company G. on 1 March 2005, infringing a prohibition on the disposal of the building.[1] Proceedings in case no. 12/2549.  On 16 July 2004 the OJSC instituted proceedings in the Rivne Regional Commercial Court against the Bailiffs Service, the applicant company and U.Y., seeking the invalidation of (i) the actions taken by the Bailiffs Service to sell the building, (ii) the public auction for the sale of the building of 2 July 2004, (iii) the certificate of purchase for the building following the public auction of 2 July 2004, and (iv) the applicant company’s title to the building; and further seeking to reclaim the building from the applicant company’s possession. The OJSC claimed that it had title to the building and that its transfer to the R.A.S.’s statutory fund had been unlawful. The R.A.S. participated in the proceedings as a third party, on the side of the claimant, without bringing an independent claim. During the proceedings it fully supported the OJSC’s position.10.  Following a re-examination of the case, on 17 August 2005 the Rivne Regional Commercial Court closed the proceedings regarding the validity of the actions of the Bailiffs Service for lack of jurisdiction and rejected the rest of the claim as unsubstantiated, finding that the R.A.S. had title to the building, as at the relevant time the OJSC had transferred the building to the R.A.S.’s statutory fund and it had become the latter’s property before the auction took place. The court stated, inter alia, that the R.A.S. had full enjoyment of its property rights and could possess, use and dispose of it at its discretion. It also noted a lack of coherence in the OJSC’s position, as during the proceedings it had abandoned its claim seeking a declaration of its title to the building and the claim seeking repossession of the building. The R.A.S. had supported the OJSC’s claim, and had not brought an independent claim, as it believed the building to be the OJSC’s property. However, the R.A.S. was the debtor in the enforcement proceedings. The Commercial Court further stated that the R.A.S. had not contested the actions or inaction of the Bailiffs Service in the manner prescribed by law. 11.  On 31 October 2005 the Lviv Commercial Court of Appeal upheld that decision.12.  On 2 March 2006 the Higher Commercial Court of Ukraine upheld the decisions of the lower courts.13.  On 28 December 2006 the Supreme Court of Ukraine refused to open cassation proceedings. Proceedings in case no. 2a-414/0714.  On 1 February 2007 the R.A.S. lodged an administrative claim with the Rivne City Court against the Bailiffs Service and the applicant company, seeking to have the actions of the former invalidated in respect of (i) the sale of the building, (ii) the order of 16 April 2004 for the seizure of the building, and (iii) the certificate of purchase for the building following the public auction of 2 July 2004.15.  On 3 December 2007 the Rivne City Court partly allowed the claim, invalidating the actions of the Bailiffs Service in taking steps to sell the building and the order of 16 April 2004 for the seizure of the building. The court rejected the claim regarding the validity of the certificate of 2 July 2004 as unsubstantiated, referring to the existing decision of the commercial courts in that matter.16.  On 18 September 2008 the Lviv Administrative Court of Appeal upheld the decision of the first-instance court.17.  On 9 February 2011 the Higher Administrative Court of Ukraine upheld the decisions of the lower courts. Proceedings in case no. 15/14018.  In November 2008, referring to the appellate court’s decision in case no. 2a-414/07, the R.A.S. lodged a claim with the Rivne Regional Commercial Court against U.Y., the applicant company and the Bailiffs Service, seeking the invalidation of (i) the public auction for the sale of the building of 2 July 2004, (ii) the certificate of purchase for the building following the public auction of 2 July 2004 and (iii) the applicant company’s title to the building. The R.A.S. argued that the public auction of 2 July 2004 was unlawful.19.  On 12 December 2008 the Rivne Regional Commercial Court allowed the claim and declared the public auction, the certificate of purchase for the building and the applicant company’s title to the building to be invalid. In response to the applicant company’s argument about the res judicata effect of the decisions in case no. 12/254, the first-instance court stated that Article 80 of the Code of Commercial Proceedings was not applicable, as in those proceedings the R.A.S. had not brought its own claim in relation to the subject matter of the dispute, as its procedural status was that of a third party not bringing an independent claim. In addition, the ground for the claim in case no. 15/140 was the decision in the administrative case, which had come into effect. The applicant company appealed, pointing to the res judicata effect of decisions given in case no. 12/254. It asked the appellate court to close the proceedings under Article 80 § 2 of the Code of Commercial Procedure.20.  On 12 March 2009 the Lviv Commercial Court of Appeal upheld the decision of the first-instance court. The appellate court referred to the findings of the final decision in case no. 2a-414/07, which invalidated the actions of the Bailiffs Service and which served as a reason for not closing the proceedings under Article 80 § 2 of the Code of Commercial Procedure.21.  The applicant company lodged a cassation appeal. It pleaded, among other arguments, that the proceedings should be closed in view of the res judicata effect of the decisions given in case no. 12/254, which had had the same subject matter, had involved the same parties and had been resolved as far back as 2005.22.  On 12 August 2009 the Higher Commercial Court of Ukraine upheld the decision of the appellate court. The court failed to comment on the proceedings in case no. 12/254.23.  On 1 October 2009 the Supreme Court of Ukraine refused to open cassation proceedings.Proceedings in case no. 11/7424.  In 2009 the applicant company initiated commercial proceedings against the R.A.S., the Bailiffs Service and U.Y., seeking reimbursement of the amount of 370,000 Ukrainian hryvnias (UAH) – the sum paid at the auction for the purchase of the building – and UAH 377,500 spent on improvement works.25.  On 7 February 2012 the Rivne Regional Commercial Court rejected the claim.26.  On 15 May 2012 the Rivne Commercial Court of Appeal partly allowed the applicant company’s claim on appeal, awarding the sum of UAH 370,000, to be paid from the Main Department of the State Treasury of Ukraine in the Rivne Region. That decision became final.27.  On 21 February 2019 the State Treasury of Ukraine wrote to the Ministry of Justice, informing it that on 27 December 2012 the amount of UAH 370,000 had been transferred to the applicant company’s bank account.RELEVANT LEGAL FRAMEWORK28.  Article 26 of the Code of Commercial Procedure stated at the relevant time, among other provisions, that third parties which brought an independent claim could enter into proceedings and bring their claim against one or both parties before the decision in the case was taken by the court.29.  Article 80 of the Code of Commercial Procedure provided at the relevant time that a commercial court had to close court proceedings if a previous decision had been given by a commercial court, or another body with jurisdiction, in a case between the same parties, in relation to the same subject matter, and based on the same grounds.THE LAWScope of the case30.  In its reply to the Government’s observations, on 16 May 2019 the applicant company additionally complained under Article 1 of Protocol No. 1, firstly, that the national courts had given conflicting decisions in cases nos. 12/254 and 15/140, which had violated its property rights, and secondly, that in case no. 11/74 the national courts had not allowed its claim for reimbursement of expenses for the improvement of the building, in the amount of UAH 377,500.31.  In the Court’s view, the new complaints are not an elaboration of the applicant company’s original complaint on which the parties have commented. The Court considers, therefore, that it is not appropriate now to take these matters up separately (see, mutatis mutandis, Piryanik v. Ukraine, no. 75788/01, § 20, 19 April 2005).Alleged violation of Article 6 § 1 of the Convention (res judicata complaint)32.  The applicant company complained that in case no. 15/140 the commercial courts had disregarded the final decisions given in case no. 12/254 relating to the validity of the public auction and its title to the building. It relied on Article 6 § 1 of the Convention, which reads as follows:“In the determination of his civil rights and obligations ... everyone is entitled to a fair ... hearing ... by [a] ... tribunal ...”Admissibility33.  The Court notes that this complaint is neither manifestly ill-founded nor inadmissible on any other grounds listed in Article 35 of the Convention. It must therefore be declared admissible.Merits34.  The applicant company submitted that the proceedings in both cases, that is, cases nos. 12/254 and 15/140 were identical, as they had concerned the same subject matter and the same parties, and that the national courts had breached their right to legal certainty, having re-examined the case in 2008-09.35.  The Government submitted that there had been no violation of Article 6 § 1 because the two sets of judicial proceedings, that is, nos. 12/254 and 15/140, had involved different parties, a different material scope, and different grounds. In particular, in proceedings no. 12/254, the national courts had examined the issue of the OJSC’s property rights on the basis of the allegedly illegal transfer of the building to the R.A.S., whereas in proceedings no. 15/140 the national court had examined the consequences of the recognition of the illegality of the Bailiffs Service’s actions, established in administrative proceedings no. 2a-414/07.36.  The Government further contended that the R.A.S. was independent from the OJSC for the purpose of acquiring and exercising various property rights, as well as for participating in civil proceedings for the protection of those rights, and that its claim had only been considered in case no. 15/140. Lastly, the applicant company had successfully claimed the recovery of the sum paid for the building in separate proceedings.37.  The Court reiterates that the right to a fair hearing under Article 6 § 1 of the Convention, interpreted in the light of the principles of the rule of law and legal certainty, encompasses the requirement that where the courts have finally determined an issue, their ruling should not be called into question (see Brumărescu v. Romania [GC], no. 28342/95, § 61, ECHR 1999‑VII).38.  That principle does not allow a party to seek the reopening of proceedings merely for the purpose of a rehearing and a fresh decision on the case. The mere possibility of there being two views on the subject is not a ground for re-examination. Departures from that principle are justified only when made necessary by circumstances of a substantial and compelling character (see Ryabykh v. Russia, no. 52854/99, § 52, ECHR 2003‑IX).39.  Furthermore, the Court observes that in all legal systems the res judicata effects of judgments have limitations ad personam and as to material scope (see, for instance, Kehaya and Others v. Bulgaria, nos. 47797/99 and 68698/01, § 66, 12 January 2006; Brletić v. Croatia, no. 42009/10, § 43, 16 January 2014; Mihaylova v. Bulgaria (dec.), case no. 30942/04, § 35, 13 January 2015; and Šulija v. Lithuania [Committee] (dec.), no. 76618/16, § 35, 29 January 2019).40.  The Government argued that proceedings no. 15/140 were different from proceedings no. 12/254 in three aspects: that in case no. 12/254 the main issue was the illegal transfer of the building from the OJSC to the R.A.S.; that the latter did not bring an independent claim; and that in proceedings no. 15/140, the basis for the claim was the decisions in proceedings no. 2a-414/07.41.  The Court observes that in proceedings no. 12/254, the national courts issued their decisions in relation to the issues of the validity of (i) the public auction for the sale of the building of 2 July 2004, (ii) the certificate of purchase for the building following the public auction of 2 July 2004, and (iii) the applicant company’s title to the building, and found them to be valid. In proceedings no. 15/140, the national courts invalidated (i) the public auction for the sale of the building of 2 July 2004, (ii) the certificate of purchase for the building following the public auction of 2 July 2004, and (iii) the applicant company’s title to the building. Given that the claims in both proceedings were identical, the Court cannot accept the Government’s argument that the main issue in proceedings no. 12/254 was the allegedly illegal transfer of the building to the R.A.S (see paragraph 35 above).42.  The Court further observes that in proceedings no. 12/254, the R.A.S. could have brought an independent claim if it had deemed that its rights had to be protected (see paragraph 28 above). Nevertheless, it participated as a third party on the side of the claimant, without bringing an independent claim. It fully supported the position of its parent company, the OJSC, which sought to invalidate the public auction and the associated documents, claiming, inter alia, that the building was the OJSC’s property. In proceedings no. 15/140, the R.A.S. sought to invalidate the public auction and the associated documents, claiming, however, that the building belonged to the R.A.S.43.  Moreover, the Court cannot agree with the contention that the decisions in proceedings no. 2a-414/07 were a justification for bringing the same issue for re-examination before the national courts. In this regard, the Court refers to the statement of the Rivne Regional Commercial Court in its decision of 17 August 2005, where it pointed to a failure of the R.A.S. to object to the actions or inaction of the Bailiffs Service in the manner prescribed by law (see paragraph 10 above). The Court further observes that the R.A.S. started objecting to the actions of the Bailiffs Service only after the issuance of the final decision in proceedings no. 12/254, in which the claim, that it had fully supported, was dismissed. In these circumstances, the Court finds that the R.A.S.’s actions taken in proceedings nos. 2a-414/07 and 15/140, were aimed at invalidating the consequences of the court decisions in proceedings no. 12/254.44.  Ultimately, proceedings no. 15/140 set at naught the entire judicial proceedings no. 12/254, depriving its final decision of any legal effect and resulting in the violation of the principle of legal certainty.45.  There has accordingly been a violation of Article 6 § 1 of the Convention.OTHER ALLEGED VIOLATIONS OF THE CONVENTION46.  The applicant company further complained that in case no. 15/140 the commercial courts had applied the same legal provisions and other regulatory acts differently as compared with the Supreme Court’s decision of 4 July 2007 in case no. 6-4424св05, which in its view had been similar.47.  In the light of all the material in its possession, the Court finds that this complaint does not disclose any appearance of a violation of the rights and freedoms set out in the Convention or its Protocols. Accordingly, this part of the application must be rejected as manifestly ill-founded and declared inadmissible pursuant to Article 35 §§ 3 (a) and 4 of the Convention.APPLICATION OF ARTICLE 41 OF THE CONVENTION48.  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.”49.  The applicant company did not submit a claim for just satisfaction. Accordingly, the Court considers that there is no call to award it any sum on that account.FOR THESE REASONS, THE COURT, UNANIMOUSLY,Declares the complaint concerning the issue of res judicata admissible and the remainder of the application inadmissible;Holds that there has been a violation of Article 6 § 1 of the Convention.Done in English, and notified in writing on 25 November 2021, pursuant to Rule 77 §§ 2 and 3 of the Rules of Court. Martina Keller  Stéphanie Mourou-Vikström Deputy Registrar President[1] Rectified on 6 December 2021: the sentence was “On 23 February and 1 March 2005 the OJSC sold the building to the private company G., infringing a prohibition on the disposal of the building.”