Information Note on the Court’s case-law 253
Karimov and Others v. Azerbaijan – 24219/16, 56908/16 and 60139/16
Judgment 22.7.2021 [Section V]
Allegation of financial incapacity not taken into account in the imposition of administrative detention for non-compliance with judgments ordering repayment of debts: violation
Facts – The applicants were sentenced to administrative detention for non-compliance with judgments ordering them to repay debts to private creditors.
They complained that the proceedings had been unfair, alleging that the sentences had been imposed without their arguments concerning their financial incapacity to repay their debts having been taken into account, despite the requirements laid down in domestic law.
Law – Article 6 § 1:
This complaint concerned the fairness of administrative proceedings with criminal implications for the purposes of the requirements of Article 6.
The Court limited its examination to the proceedings that had ended with final decisions in which the domestic courts had imposed administrative sanctions resulting in deprivation of liberty for the applicants in their capacity as debtors.
All parties to judicial proceedings should be able to expect a specific and express reply to those submissions which were decisive for the outcome of the proceedings in issue. Furthermore, the reasons provided for decisions given by the domestic courts should not be automatic or formulaic.
The domestic courts had found the applicants guilty of an offence provided for in the Code of Administrative Offences and had imposed a sentence of administrative detention on them. In establishing the applicants’ guilt, it had been necessary to find that, without a valid reason, they had failed to comply with the judgments ordering them to repay their debts to their creditors. The reasons given by debtors to justify not discharging their pecuniary obligations were decisive for the characterisation of the offence, since they could give rise to a ground for exemption from liability. A personalised assessment of the financial position of debtors and of their good faith in defaulting was essential. The relevant procedure, being criminal in nature but with administrative aspects, required the party bringing the accusation to prove that the defaulting debtors did in fact, contrary to their assertions, have the financial capacity to discharge their debt.
In those circumstances, it was clear that the arguments put forward by the applicants in the domestic courts, in particular their argument that the reason for their non-compliance had been their financial incapacity to repay the debts, had been of crucial importance in view of the actual wording of the law, and had required a clear response and a judicial determination of whether the valid reasons given by the applicants were well-founded. In that connection, if the reason for the applicants’ non-compliance had been their financial incapacity, that could also raise an issue under Article 1 of Protocol No. 4, by which “[n]o one shall be deprived of his liberty merely on the ground of inability to fulfil a contractual obligation”. However, the domestic courts had not made any effort to ascertain whether there had been no valid grounds for the non-compliance and had never addressed that argument, despite having been invited to do so by the applicants both at first instance and on appeal. This failure by the domestic courts to examine the reason for the non-compliance appeared all the more contradictory in that the judgments imposing the sentence had themselves referred to the applicants’ precarious financial circumstances without expressing any doubts as to the factual veracity of the financial difficulties hindering repayment.
Moreover, the Constitutional Court had itself stressed the requirement of a detailed examination of all the facts by the courts when applying an administrative sanction or penalty for non-compliance with judicial decisions, and the need to assess whether the default was intentional and whether the debtor had used all available means to comply with the bailiff’s demands. It had to be acknowledged that those factors had not been examined by the courts that had imposed the sanction in the present case.
Accordingly, the fundamental argument at the heart of the case put forward by the applicants, which had been decisive for the outcome of the proceedings, had not been given a specific and express reply, and the domestic courts had therefore failed to comply with their obligation under Article 6 to provide reasons.
Conclusion: violation (unanimously).
Relying on Article 1 of Protocol No. 4, the applicants complained that their administrative detention had been solely based on their inability to fulfil their contractual obligations. However, having regard to the facts of the case, the parties’ arguments and the conclusions reached under Article 6 § 1, the Court held that it was unnecessary to examine the admissibility and merits of this complaint.
Article 41: EUR 3,600 in respect of non-pecuniary damage.
(See also Ruiz Torija v. Spain, 18390/91, 9 December 1994, Legal summary; Higgins and Others v. France, 20124/92, 19 February 1998, Legal summary)