CASE OF FELDMAN AND SLOVYANSKYY BANK v. UKRAINE

1. The case originated in an application (no. 42758/05) against Ukraine lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (“the Convention”) by a Ukrainian national, Mr Borys Mordukhovych Feldman (“the first applicant”), and Slovyanskyy Commercial Joint- Stock Bank ( “ the applicant bank ” ), on 20 October 2005. In the proceedings before the Court the first applicant acted on his own behalf and on behalf of the applicant bank.
2. The applicants were represented by Mr V. Ageyev, a lawyer practising in Kyiv. The Ukrainian Government (“the Government”) were represented by their Agent, most recently, Mr I. Lishchyna.
3. Relying on Article 6 § 1 of the Convention and Article 1 of Protocol No. 1, the applicants alleged, in particular, that they had not had access to a court to challenge the decision on the liquidation of the applicant bank and that that decision had violated their property rights.
4. On 15 November 2006 the application was communicated to the Government.
I. THE CIRCUMSTANCES OF THE CASE
5. The first applicant was born in 1958 and lives in Dnipro, Ukraine. The applicant bank was a commercial joint-stock bank based in Ukraine with its registered office in Zaporizhzhya. Its banking licence was revoked on 11 January 2001 (see paragraph 12 below). Subsequently, the applicant bank was liquidated (see paragraph 19 below).
6. The first applicant was the vice- president, founder and majority shareholder of the applicant bank.
7. In February and March 2000 the domestic authorities instituted two sets of criminal proceedings for tax evasion and abuse of office by the management of the applicant bank.
8. In March 2000 the first applicant was arrested as part of the criminal proceedings (for more details see Feldman v. Ukraine, nos. 76556/01 and 38779/04, 8 April 2010). In April 2000 the Ukrainian news agency UNIAN reported on a session of the Coordination Committee on Combating Corruption and Organised Crime. The relevant extract reads:
“ ‘ It is a matter of honour for the General Prosecutor ’ s Office and the State Tax Administration to bring the story of Slovyanskyy Bank to its logical conclusion, ’ said the President of Ukraine during his speech at the session ... He stated that the chairs of the bank had turned it into a source of uncontrolled personal income. ‘ Such money ‑ makers have powerful patrons, and there is great pressure on the investigation, ’ stated the President.”
9. On 29 June 2000 the National Bank of Ukraine (“the NBU”) suspended the applicant bank ’ s licence for some of its operations, considering that its financial position had deteriorated sharply and that it had been performing risky operations which threatened its solvency.
10. In July 2000 an investigator from the tax police of the State Tax Administration, acting in the course of the criminal proceedings, ordered an attachment of the applicant bank ’ s securities.
11. On 18 September 2000 the NBU put the applicant bank under temporary administration, which involved suspending the functions of some of the bank ’ s managers.
12. On 11 January 2001 the NBU issued a resolution “ On the Liquidation of Slovyanskyy Commercial Joint-Stock Bank” by which, among other things, (1) the applicant bank ’ s operating licence was revoked in full; (2) the powers of the board, the council and the general shareholders ’ meetings were terminated; and (3) the applicant bank was ordered to be liquidated. By the same resolution the NBU approved the composition of a liquidation commission for the bank, consisting of eleven officials from the regional departments of the NBU and two members of staff from the local tax office.
13. On 5 March 2001 the first applicant, who was in detention at the time, brought a claim under the rules of Chapter 31-A of the Code of Civil Procedure of 1963 with the Pechersky District Court of Kyiv, challenging the NBU ’ s decision. He maintained that the impugned resolution was unlawful and that the NBU had decided to liquidate the applicant bank owing to its failure to fulfil its financial obligations, whereas that failure had been caused by the NBU itself and the tax authorities. The first applicant emphasised that after the resolution had been adopted, the applicant bank had not been able to protect its rights and interests on its own. He added that the resolution had been detrimental to the interests of the applicant bank ’ s shareholders, including himself.
14. On 26 June 2001 the court found that the first applicant could bring a claim, however, it had to be dismissed. The court held that the NBU had been competent to adopt the impugned resolution, that the measures taken had been lawful and that they had been made necessary by gross violations of banking legislation by the applicant bank and its difficult financial position.
15. The first applicant appealed against that decision.
16. On 5 July 2002 the Kyiv City Court of Appeal upheld the decision of 26 June 2001 in part, but changed its reasoning. It held that the NBU ’ s resolution of 11 January 2001 had not concerned the first applicant and it had not been established during the determination of the claim that his rights and freedoms had been violated. For those reasons the court of appeal dismissed the claim.
17. The first applicant appealed on points of law.
18. On 21 April 2005 the Supreme Court of Ukraine quashed the decisions of 26 June 2001 and 5 July 2002 and terminated the proceedings, considering that the claim was inadmissible. It found as follows:
“... The first and second - instance courts have established that Mr B.M. Feldman brought a claim as a shareholder of Slovyanskyy Bank, however he did not request the protection of his own rights and freedoms but, in fact, acted in the interests of Slovyanskyy Bank, without being duly authorised [bold text in the original].
According to Articles 1 and 12 of the Code of Commercial Proceedings, disputes between a subject of entrepreneurial activities and enterprises, institutions and organisations concerning the protection of their rights and freedoms, and their disputes concerning the declaration of legal acts as invalid, should be examined by the commercial courts.
Given that a shareholder is not entitled to apply to a court for the examination of such a dispute and that this case is not to be examined in accordance with civil procedure, the decisions adopted in this case should be quashed and the proceedings should be terminated, in accordance with Article 136 § 2 ( 1 ) and Article 227 § 1 of the Code of Civil Procedure ... ”
19. The liquidation process of the applicant bank was completed on 30 November 2012. The bank was removed from the legal entities official database on 4 August 2014.
A. Domestic legislation on access to court
20. Chapter 31-A of the Code of Civil Procedure of 1963 (in force at the relevant time) sets out the rules for challenging the decisions, acts or omissions of a State body, legal entity or official and for the consideration of such claims before the civil courts.
21. Article 1 of the Code of Commercial Procedure of 1991 provides, inter alia, that legal entities and citizens who have been registered as private entrepreneurs are entitled to apply to the commercial courts, in accordance with the rules of jurisdiction, for the protection of their rights and interests.
B. Domestic legislation on banking supervision
22. Section 62 of the Law “On the National Bank of Ukraine ” of 20 May 1999 provided, among other things, that the National Bank was entitled to revoke a bank ’ s operating licence and take decisions about the reorganisation or liquidation of a bank and the appointing of a liquidator. It could make such decisions if the bank had violated laws and other regulations, which had resulted in a significant loss of assets or income and caused the bank to become insolvent, or if it had inflicted serious damage to its clients or concealed any accounts, other documents or assets.
23. On 17 January 2001 a new law, the Law “On Banks and Banking Activities ”, came into effect, repealing section 62 of the Law “On the National Bank of Ukraine ”. It also introduced a judicial procedure for liquidating banks.
24. The applicants complained that it had not been possible to have the NBU ’ s resolution of 11 January 2001 reviewed by a tribunal, within the meaning of Article 6 § 1 of the Convention. They further complained that the NBU ’ s resolution and the measures taken by the tax authorities concerning the applicant bank ’ s assets had been contrary to Article 1 of Protocol No. 1. Those provisions, in so far as relevant, read as follows:
Article 6 § 1 of the Convention
“In the determination of his civil rights and obligations ... everyone is entitled to a fair ... hearing ... by [a] ... tribunal ...”
“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.”
I. PRELIMINARY PROCEDURAL POINTS
25. The first applicant lodged the above complaints on his own behalf and on behalf of the applicant bank. The question arises whether the first applicant had standing to act before the Court on behalf of the applicant bank.
26. The Court reiterates that as a general rule a shareholder of a company cannot claim to be a victim of an alleged violation of the company ’ s rights under the Convention (see Agrotexim and Others v. Greece, 24 October 1995, §§ 59-72, Series A no. 330 ‑ A). The piercing of the “ corporate veil ” or the disregarding of a company ’ s legal personality will be justified only in exceptional circumstances, in particular where it is clearly established that it is impossible for the company to apply to the Convention institutions through the organs set up under its articles of incorporation or – in the event of liquidation – through its liquidators (ibid., § 66).
27. In Credit and Industrial Bank v. the Czech Republic (no. 29010/95, ECHR 2003-XI (extracts)) the Court stated that where the essence of the complaint was the denial of effective access to a court to oppose or appeal against the appointment of a compulsory administrator, to hold that the administrator alone was authorised to represent the bank in lodging an application with the Convention institutions would be to render the right of individual petition conferred by Article 34 theoretical and illusory (ibid., § 51).
28. As regards the present case, in lodging the complaints on behalf of the applicant bank, the first applicant acted in his capacity as the bank ’ s majority shareholder and vice-president. At the time of the application, the shareholders and the executive bodies of the applicant bank had been deprived of their powers to administer the applicant bank ’ s business. The bank was under the control of the liquidation commission, which consisted of officials from the regional departments of the NBU, who were by far in the majority, and staff from the local tax office (see paragraph 12 above). Accordingly, having regard to the situation of the applicant bank and the nature of the present complaints, the Court finds that there existed exceptional circumstances which entitled the first applicant to lodge the present application on behalf of the applicant bank (see Credit and Industrial Bank, cited above, § § 46 -52, and Capital Bank AD v. Bulgaria (dec.), no. 49429/99, 9 September 2004).
29. The Court further considers it appropriate to continue examination of the present case despite the termination of legal personality of the applicant bank (see Capital Bank AD v. Bulgaria, no. 49429/99, §§ 74-80, ECHR 2005 ‑ XII (extracts) and International Bank for Commerce and Development AD and Others v. Bulgaria, no. 7031/05, § 88, 2 June 2016, with further references therein).
II. ADMISSIBILITY OF THE FIRST APPLICANT ’ S COMPLAINTS
30. The Court considers that the first applicant ’ s complaints in his personal capacity as a majority shareholder are incompatible ratione personae with the provisions of the Convention within the meaning of Article 35 § 3 (a) of the Convention and must be rejected in accordance with Article 35 § 4 (see Credit and Industrial Bank v. the Czech Republic, no. 29010/95, Commission decision of 20 May 1998, and Terem Ltd, Chechetkin and Olius v. Ukraine, no. 70297/01, §§ 28-30, 18 October 2005).
III. ALLEGED VIOLATION OF ARTICLE 6 § 1 OF THE CONVENTION
1. The Government ’ s objection
31. The Government submitted that the applicant bank had not exhausted the available domestic remedies as it had failed to challenge the NBU ’ s impugned resolution before the commercial courts.
32. The applicant bank insisted that it had not been possible to institute proceedings before the commercial courts to challenge the measures taken by the NBU because the applicant bank had been controlled by the liquidation commission, which consisted of officials from NBU departments and the tax office.
33. The Court notes that the question of the use of the remedy referred to by the Government is closely linked to the substance of the applicant bank ’ s complaint. The Court therefore joins the Government ’ s objection to the merits.
34. The Court reiterates that as a rule, the six-month period under Article 35 § 1 of the Convention runs from the date of the final decision in the process of the exhaustion of domestic remedies. Where it is clear from the outset, however, that no effective remedy is available to the applicant, the period runs from the date of the acts or measures complained of, or from the date of acquiring knowledge of that act or its effect on or prejudice to the applicant. Where an applicant avails himself of an apparently existing remedy and only subsequently becomes aware of circumstances which render the remedy ineffective, it may be appropriate, for the purposes of Article 35 § 1, to take the start of the six-month period as the date when the applicant first became or ought to have become aware of those circumstances (see Varnava and Others v. Turkey [GC], nos. 16064/90, 16065/90, 16066/90, 16068/90, 16069/90, 16070/90, 16071/90, 16072/90 and 16073/90, § 157, ECHR 2009, with further references).
35. The present application was submitted to the Court within six months of the completion of the domestic proceedings instituted by the first applicant challenging the NBU ’ s resolution of 11 January 20 0 1. The question of whether or not the first applicant ’ s claim was admissible had not been decided in a straightforward way by the courts. In particular, the first ‑ instance court found that even though the impugned resolution had concerned the applicant bank, the first applicant was still in position to raise the matter before the civil courts. The court of appeal did not reject the claim as inadmissible, but dismissed it after examining it and finding that the matter did not concern the first applicant ’ s rights. Lastly, the Supreme Court terminated the proceedings on the grounds that the first applicant ’ s claim was inadmissible. The Supreme Court considered that shareholders could not apply to the courts in their own capacity on such matters and that, furthermore, the case should be examined by the commercial courts.
36. In view of this diverse reasoning of the domestic courts as well as the applicants ’ specific situation, it cannot be argued that at the relevant time during the period when the proceedings were pending it was clear that the remedy tried by the first applicant in the interests of the applicant bank was ineffective and should not have been pursued. On the contrary, the Court considers that introduction of the present complaint after the completion of the domestic proceedings was justified in the circumstances and it is not appropriate to blame the first applicant for his attempt to settle the applicant bank ’ s case at the domestic level (see, mutatis mutandis, Voloshyn v. Ukraine, no. 15853/08, § 42, 10 October 2013 ). Accordingly, the present complaint cannot be dismissed as being submitted out of time (see, mutatis mutandis, Kaverzin v. Ukraine, no. 23893/03, § 99, 15 May 2012 ).
3. Otherwise as to admissibility
37. 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.
38. The applicant bank maintained that it had not had access to a court to challenge the NBU ’ s resolution of 11 January 2001.
39. The Government insisted that the applicant bank ’ s right of access to a court had not been infringed because the matter could still be examined by the commercial courts.
40. The Court notes that the measures introduced by the NBU ’ s resolution of 11 January 2001 had a crucial impact on the applicant bank ’ s civil rights and obligations. In particular, the resolution led to the applicant bank ’ s licence for all its operations being revoked, the powers of the applicant bank ’ s statutory bodies were terminated, and the applicant bank itself was put into liquidation.
41. The Court notes that where decisions taken by administrative authorities which determine civil rights and obligations do not themselves satisfy the requirements of Article 6 of the Convention, it is necessary that such decisions be subject to subsequent control by a “judicial body that has full jurisdiction” and that provides the guarantees of that Article (see Albert and Le Compte v. Belgium, 10 February 1983, Series A no. 58, § 29; Ortenberg v. Austria, 25 November 1994, Series A no. 295-B, § 31; and Bryan v. the United Kingdom, 22 November 1995, Series A no. 335-A, § 40).
42. The Court observes that the proceedings before the civil courts initiated by the first applicant did not ultimately result in any judicial review of the impugned measures. The Supreme Court terminated the proceedings, rejecting the claim as inadmissible after finding that the first applicant had not been empowered to apply on behalf of the applicant bank and that the claim fell under the jurisdiction of the commercial courts.
43. Further to the Supreme Court ’ s position, the Government contended that the applicant bank had failed to apply to the commercial courts, which had been competent to examine the matter. In that regard the Court notes that at the relevant time the applicant bank was under the control of the liquidation commission. The composition of the commission, which mostly consisted of employees from regional departments of the NBU, clearly indicated that there was a conflict of interests between the commission and the applicant bank, making it unfeasible for the latter to lodge a claim with the commercial court challenging the NBU ’ s resolution.
44. Similarly, it cannot be reasonably assumed that the first applicant could lodge such a claim with the commercial courts. Those courts dealt with claims submitted by legal entities and individuals could only institute commercial proceedings if they were acting in the capacity of private entrepreneurs, which was not the first applicant ’ s case (see paragraph 21 above). In any event, the position of the Supreme Court in its decision of 21 April 2005 (see paragraph 18 above) suggested that the first applicant, as a shareholder, had not been entitled to institute proceedings before any courts, including the commercial courts.
45. The Court therefore dismisses the Government ’ s objection based on the rule of exhaustion of domestic remedies. It further finds that the applicant bank did not have access to a court in the dispute concerning its civil rights and obligations.
46. There has therefore been a violation of Article 6 § 1 of the Convention in respect of the applicant bank.
IV. ALLEGED VIOLATION OF ARTICLE 1 OF PROTOCOL NO. 1
A. Alleged violation of the applicant bank ’ s property rights by the NBU
47. The applicant company complained under Article 1 of Protocol No. 1 that the NBU ’ s resolution of 11 January 2001 had been unlawful and disproportionate and that there had been no opportunity to obtain an independent review of the measures taken by the NBU because the domestic courts had failed to deal with the relevant issues.
48. The Court notes that this complaint is linked to the one examined above under Article 6 § 1 of the Convention and must therefore likewise be declared admissible.
49. The applicant bank maintained its complaint.
50. The Government conceded that the NBU ’ s resolution of 11 January 2001 had constituted an interference with the applicant bank ’ s property rights. However, that decision had been taken in full compliance with the domestic legislation that was in effect at the relevant time. The subsequent legislative amendments (see paragraph 23 above) had not affected the lawfulness of the impugned resolution. The Government also submitted that the NBU ’ s measures had been entirely necessary in the circumstances in order to protect the interests of others.
(i) Applicability of Article 1 of Protocol No. 1
51. It is common ground between the parties that Article 1 of Protocol No. 1 is applicable to the present complaint. The Court notes that the NBU ’ s resolution of 11 January 2001 revoked the applicant bank ’ s licence and put it into liquidation. Such measures prevented the applicant bank from pursuing its business and interfered with its right to the peaceful enjoyment of its possessions.
52. As regards the applicable provision of Article 1 of Protocol No. 1, the Court observes that the NBU ’ s resolution was taken as a measure to control the banking sector in the country. It is true that it involved a deprivation of property, in so far as the banking licence itself could be considered a possession, but in the circumstances the deprivation formed part of the mechanism of controlling the banking industry. The Court therefore considers that it is the second paragraph of Article 1 of Protocol No. 1 which is applicable (see Capital Bank AD v. Bulgaria, no. 49429/99, §§ 130 - 131, ECHR 2005 ‑ XII (extracts)).
(ii) Compliance with Article 1 of Protocol No. 1
53. The Court reiterates that the first and most important requirement of Article 1 of Protocol No. 1 is that any interference by a public authority with the peaceful enjoyment of possessions should be lawful: the second sentence of the first paragraph authorises a deprivation of possessions only “subject to the conditions provided for by law”, while the second paragraph recognises that States have the right to control the use of property by enforcing “laws”. Moreover, the rule of law, one of the fundamental principles of a democratic society, is inherent in all the Articles of the Convention (see Iatridis v. Greece [GC], no. 31107/96, § 58, ECHR 1999 ‑ II).
54. The Court ’ s power to review the compliance of an impugned measure with national law is limited and it is not its task to take the place of the domestic authorities in making such an assessment (see Malone v. the United Kingdom, judgment of 2 August 1984, Series A no. 82, § 79, and Sovtransavto Holding v. Ukraine, no. 48553/99, § 95, ECHR 2002 ‑ VII). This is particularly relevant to the present case, which concerns a decision aiming, according to the NBU, at ensuring the stability of the banking system, a delicate area in which the Contracting States enjoy a wide margin of appreciation (see Olczak v. Poland ( dec.), no. 30417/96, § 85, ECHR 2002 X (extracts), and Capital Bank AD, cited above, § 136). Nevertheless, that does not dispense the Court of its duty to determine whether the interference at issue complied with the requirements of Article 1 of Protocol No. 1.
55. The requirement of lawfulness, within the meaning of the Convention, presupposes, among other things, that domestic law must provide a measure of legal protection against arbitrary interference by public authorities with the rights safeguarded by the Convention. Furthermore, the concepts of lawfulness and the rule of law in a democratic society require that measures affecting fundamental human rights be, in certain cases, subject to some form of adversarial proceedings before an independent body competent to review the reasons for the measures and the relevant evidence. It is true that Article 1 of Protocol No. 1 contains no explicit procedural requirements and the absence of a judicial review does not amount, in itself, to a violation of that provision. Nevertheless, it implies that any interference with the peaceful enjoyment of possessions must be accompanied by procedural guarantees affording to the individual or entity concerned a reasonable opportunity of presenting their case to the responsible authorities for the purpose of effectively challenging the measures interfering with the rights guaranteed by this provision. In ascertaining whether this condition has been satisfied, a comprehensive view must be taken of the applicable judicial and administrative procedures (see Capital Bank AD, cited above, § 13 4 ).
56. In the present case the NBU decided to revoke the applicant bank ’ s operating licence and opened a liquidation process. The decision was taken in compliance with the domestic law applicable at the relevant time. Later amendments to the domestic legislation introduced a judicial procedure for the liquidation of banks (see paragraph 23 above). While those amendments applied to subsequent decisions in the course of the applicant bank ’ s liquidation, the Government validly submitted that the impugned NBU decision of 11 January 2001 was not affected by them.
57. In line with the judgment in Capital Bank AD (cited above), the Court considers further that an act entailing such grave consequences can only be legitimate if it is carried out after or is subject to some sort of verification in proceedings that afford a reasonable opportunity to the bank concerned to present its case to a competent authority with a view to effectively challenging such measures ( ibid., § 135 in fine ).
58. The administrative procedure leading to the impugned measures was entirely entrusted to the NBU, which exercised wide discretion in that area, and it does not appear that adequate guarantees for an independent and impartial decision-making process were put in place. Those guarantees were particularly relevant in the present case in view of the NBU ’ s involvement in the applicant bank ’ s situation by way of the taking of preliminary control measures before the impugned resolution of 11 January 2001 (see paragraphs 9 and 11 above) and in view of the other circumstances which surrounded the applicant bank and the first applicant at the relevant time ( see paragraphs 7 and 8 above). Furthermore, there is nothing to suggest that the administrative procedure resulting in the NBU ’ s resolution of 11 January 2001 involved any effective participation by the management of the bank to enable them to present their position on the situation and to object, if appropriate, to the contemplated measures before they were carried out. There is nothing to indicate that the necessity for such effective participation in the procedure was outweighed by any valid considerations, including those of urgency or emergency ( ibid., § 136).
59. Finally, there were no effective retrospective remedies that could be used by the applicant bank against the NBU ’ s resolution. In particular, the above analysis under Article 6 § 1 of the Convention has shown that the applicant bank did not have access to a court to challenge the NBU ’ s measures.
60. In the light of the foregoing, the Court concludes that the interference with the applicant bank ’ s possessions was not surrounded by sufficient guarantees against arbitrariness and was not therefore lawful within the meaning of Article 1 of Protocol No. 1. The above considerations are sufficient for the Court to find that there has been a violation of that provision.
B. Allegedly unlawful measures concerning the applicant bank ’ s assets
61. The applicant bank complained under Article 1 of Protocol No. 1 that in July 2000 an attachment order had unlawfully been applied to its assets. It further submitted that the attached assets had been subsequently seized without proper grounds and that those measures had caused the economic destruction of the bank, which had eventually resulted in liquidation proceedings.
62. The Government maintained that the applicant bank had failed to exhaust domestic remedies as it had not challenged the impugned measures before the domestic courts. The Government specified that in 2001 the attachment had been lifted and the assets had remained at the disposal of the applicant bank ’ s liquidation commission.
63. The applicant bank argued that it had been controlled by the liquidation commission and that the only available remedy had been the civil action against the NBU taken by the first applicant.
64. In considering the applicant bank ’ s contention, the Court notes that the measures complained of took place when the applicant bank could still act through its statutory bodies to seek protection of its property rights before the domestic authorities. As to the subsequent period when the applicant bank could not effectively operate via its statutory bodies, the Court does not consider that the action of the first applicant should be taken into account as regards the present complaint. The first applicant challenged only the NBU ’ s resolution, he did not seek to declare the investigator ’ s impugned measures unlawful and did not seek any other relief in that regard. The property issues raised in the present complaint were therefore never examined within those proceedings.
65. The Court further notes that, by virtue of the requirements of Article 35 § 1 of the Convention, the applicant bank should have either raised the present complaint at the domestic level or – if there was no effective remedy to use – submitted it to the Court within six months of the impugned measures taking place. That was not done, however. The relevant events took place in 2000, whereas the applicant bank lodged its complaint with the Court in 2005. It follows that this part of the application should be rejected as inadmissible, pursuant to Article 35 §§ 1 and 4 of the Convention.
V. APPLICATION OF ARTICLE 41 OF THE CONVENTION
66. 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.”