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SECOND
SECTION
CASE OF ARRAS AND OTHERS v. ITALY
(Application
no. 17972/07)
JUDGMENT
STRASBOURG
14
February 2012
This
judgment will become final in the circumstances set out in Article 44
§ 2 of the Convention. It may be subject to editorial
revision.
In the case of Arras and Others v.
Italy,
The
European Court of Human Rights (Second Section), sitting as a Chamber
composed of:
Françoise Tulkens,
President,
Danutė Jočienė,
Dragoljub
Popović,
Işıl Karakaş,
Guido
Raimondi,
Paulo Pinto de Albuquerque,
Helen
Keller, judges,
and Stanley Naismith,
Section Registrar,
Having
deliberated in private on 24 January 2012,
Delivers
the following judgment, which was adopted on that date:
PROCEDURE
- The
case originated in an application (no. 17972/07) against the Italian
Republic lodged with the Court under Article 34 of the Convention for
the Protection of Human Rights and Fundamental Freedoms (“the
Convention”) by four Italian nationals, Mr Antonio Arras, Ms
Celestina Dede, Mr Alessandro Dessi and Mr Bachisio Zizi (“the
applicants”), on 20 April 2007.
- The
applicants were represented by Mr G. Ferraro, R. Mastroianni and F.
Ferraro lawyers practising in Naples. The Italian Government (“the
Government”) were represented by Ms Ersiliagrazia Spatafora,
Agent of the Government and Ms Paola Accardo, Co-Agent of the
Government.
- The
applicants alleged that they had been subject to a legislative
interference pending their proceedings which was in breach of their
fair trial rights under Article 6.
- On
3 January 2011 the application was communicated to the Government. It
was also decided to rule on the admissibility and merits of the
application at the same time (Article 29 § 1).
- On
unspecified dates, following the introduction of the application, Mr
Arras and Mr Dessi passed away. By a letter of 21 October 2010, the
Court was informed that their heirs (Roberto Arras, Mirella Arras and
Regina Obbino in respect of Mr Arras, and Giorgio Dessi, Loredana
Dessi, Susanna Dessi, Alessio Dessi, Silvia Dessi, Carmela Pilleri,
and Rosalba Dessi in respect of Mr Dessi) wished to continue with the
proceedings. For practical reasons, Mr Arras and Mr Dessi will
continue to be referred to as the applicants in this judgment.
THE FACTS
I. THE CIRCUMSTANCES OF THE CASE
- The
applicants were born in 1939, 1933, 1933 and 1925 respectively and
lived in Italy.
A. Background of the case
- The
applicants are all pensioners (retired prior to 31 December 1990) and
former employees of the Banco Di Napoli (a banking group which was
originally a public entity and was later privatised).
- Before
their privatisation, the Banco di Napoli and the Banco di Sicilia
were subject to exclusive welfare systems according to Articles 11
and 39 of Law no. 486 of 1985. Their employees benefited from a more
favourable equalisation mechanism (meccanismo perequativo)
than that available to persons registered with the general compulsory
insurance (assicurazione generale obligatoria). In particular,
the annual pension increase of their pensioners was calculated on the
basis of the salary increases of working employees in equal grades of
service (perequazione aziendale).
- In
1990 the Amato reform provided for the privatisation of public banks
such as the Banco di Napoli. It suppressed their exclusive pension
regimes, replacing them by integrated ones. It provided for the
registration of the Banco di Napoli employees with a new welfare
management system which was part of the general obligatory insurance
managed by the Istituto Nazionale della Previdenza Sociale
(“INPS”), an Italian welfare entity.
- In
1992 a further partial pension reform took place.
- In
1993 a number of former employees who had by then retired, entered
into a dispute with the Banco di Napoli about the application of
certain provisions. In particular, by means of a wide interpretation
of section 9 of Law no. 503 of 1992 (hereinafter Law no. 503/92)
and section 3 of Law no. 421 of 23 October 1992 (hereinafter Law no.
421/92) (see Relevant domestic law) the Banco di Napoli attempted to
suppress the system of perequazione aziendale calculated on
the basis of the salary increases of working employees in equal
grades of service, also in respect of persons who were already
retired, limiting the latter’s perequazione to an
automatic one, namely a simple increase according to the cost of
living (perequazione legale), which resulted in a less
substantial pension.
- The
latter stand was taken notwithstanding that, according to the
applicants, Law no. 218 of 30 July 1990 (Amato reform), particularly
its section 3 paragraph 1 and 2, and section 3 of Law no. 421 of 23
October 1992 (see Relevant domestic law), limited this suppression
solely to persons still employed and not persons already receiving a
pension. Indeed persons still employed had been given the option of
taking up other benefits as agreed by means of corporate collective
bargaining.
B. General domestic proceedings on the matter
- On
an unspecified date a number of pensioners in the applicants’
position instituted civil proceedings contesting the actions of the
Banco di Napoli, since as a consequence they were receiving lesser
amounts than those they claimed to be entitled to. They highlighted
that Laws nos. 503/92 and 421/92 safeguarded any more favourable
treatment applicable to persons who had retired prior to 31 December
1990. Thus, they requested the court to find that they had a right to
retain the system of perequazione aziendale as applied before
the enactment of such laws, and to order the Banco di Napoli to pay
the sums it had failed to pay them.
- By
a judgment of 31 October 1994 in Acocella and others v. Banco di
Napoli, the domestic court upheld the claimants’ arguments,
holding that they had a right to remain under the system of
perequazione aziendale even following the entry into force of
Law no. 503/92. The same was confirmed in a number of other judgments
in various jurisdictions, including the Court of Cassation (for
example, judgments nos. 1388/00 and 12912/00) and more specifically
the Court of Cassation in its ultimate formation, namely, sitting as
a full court (Sezione Unite). The latter in its judgment (no.
9024/01) of 3 July 2001 upheld the claimants’ argument on
the basis of the interpretation of Law no. 503/92 and Laws nos. 497
and 449 of 1996 and 1997 respectively, which explicitly made
reference to perequazione aziendale, confirming that it had
not been abrogated by the 1992 laws. The impugned amendments applied
solely to persons still employed and not to persons who had retired
on or before 31 December 1990. In consequence, the contested right
was legitimately due to the former Banco di Napoli employees who had
retired by 31 December 1990, for the period between 1 January
1994 (date when a general suspension of pension adjustments ceased)
to 26 July 1996 (date when a new suspension of such adjustments
started in respect of the Banco di Napoli).
- This
interpretation continued to be followed uniformly by all the judges
sitting in such cases.
C. The enactment of Law no. 243/04
- Subsequently,
various legislative amendments took place attempting to limit the
application of the system of perequazione aziendale. These
culminated in the enactment of section 1 paragraph 55 of Law no.
243/04, which interpreted the relevant law to the effect that retired
employees of the Banco di Napoli could no longer benefit from the
system of perequazione aziendale and made it effective
retroactively, with effect from 1992.
- In
the meantime, section 59 paragraph 4 of Law no. 449 of 27 December
1997 (legge finanziaria of 1998) had definitively suppressed
all systems of perequazione aziendale, as from 1
January 1998.
- Thus,
generally the system of pension adjustment according to perequazione
aziendale had been recognised and remained in force from 1994 to
December 1997 (just before the entry into force of the legge
finanziaria of 1998) for other public banking entities that had
previously applied a system of perequazione aziendale, except
for the Banco di Napoli. In reality, this benefit had already been
suspended in respect of the employees of the Banco di Napoli (and
Banco di Sicilia) with effect from 26 July 1996 by means of the
Salvabanco law. Thus, for the latter’s employees the system of
perequazione aziendale would have applied only from 1 January
1994 to 26 July 1996.
D. The applicants’ domestic proceedings
- In
1996 the applicants instituted proceedings on the lines of the
proceedings mentioned above, namely they argued that Laws nos. 503/92
and 421/92 safeguarded any more favourable treatments applicable to
persons who had retired prior to 31 December 1990. Thus, they
requested the Naples Tribunal (Labour Section) to find that they had
a right to retain the system of perequazione aziendale as
applied before the enactment of such laws and to order the Banco di
Napoli to pay the sums it had failed to pay them.
- The
applicants expected a favourable outcome in view of the then
applicable case-law. Indeed, in accordance with the latter, by a
judgment of 26 February 2001, the Naples Tribunal (Labour Section)
found in favour of the applicants. It ordered the Banco di Napoli to
pay the outstanding amounts with inflation increases and legal
interest to run from 1 January 1994.
- On
appeal, by a judgment of 24 April 2004, the Naples Court of Appeal
confirmed the first-instance judgment upholding the applicants’
right to be covered by the system of perequazione aziendale,
however only for the period from 1 January 1994 (date when a general
suspension of pension adjustments ceased) to 26 July 1996 (date when
a new suspension of such adjustments started in respect of the Banco
di Napoli).
22. The
Banco di Napoli appealed.
- By
a judgment (no. 22701/06) of 19 September 2006 deposited in the
relevant registry on 23 October 2006 the Court of Cassation reversed
the lower courts’ judgments and found against the applicants,
ordering the costs of the three court instances to be paid equally
between the parties. The Court of Cassation upheld the ground of
appeal that the Naples Court of Appeal could not have taken account
of Law no. 243/04 - not yet in force at the time of its judgment - an
interpretation law applicable retroactively, which was designed to
resolve a conflict of interpretation which had been present in
domestic case-law and which had ultimately been resolved by the Court
of Cassation (Sezioni Unite). Indeed, Law no. 243/04 was
enacted to resolve the matter as to whether Articles 9 and 11 of Law
no. 503/92 applied only to employees still in service or also to
retired pensioners, and provided that as from 1994 onwards a
perequazione legale (increase according to the standard of
living) had to apply to “all” pensioners, irrespective of
their date of retirement.
- The
Court of Cassation rejected a claim of unconstitutionality in so far
as this interpretative law had retroactive effects impinging on the
principle of legal and judicial certainty. In this respect it
referred to previous Constitutional Court judgments which held that
the legislator could impose norms specifying the meaning of other
norms in so far as the meaning was one of the options emanating from
the original text and in conformity with the principle of
rationality.
E. Constitutional Court judgment no. 362 of 2008, in
analogous proceedings.
- In
2007, in two different civil cases, the Court of Cassation referred
the matter to the Constitutional Court considering that paragraph 55
of Law no. 243/04 raised issues of constitutionality on a number of
grounds: i) recourse to norms of authentic interpretation would
be unreasonable in such circumstances, it being disproportionate and
counterproductive vis à vis the aim sought,
namely the extinction of contentious proceedings; ii) the impugned
law would make the determination of the parties interest dependent on
an unconstitutional factor, namely the length of proceedings, and
would constitute an inequality of treatment between persons whose
proceedings have terminated and others whose proceedings were still
pending; iii) the impugned law would unreasonably obliterate the role
of the Court of Cassation.
- By
a judgment filed in the registry on 7 November 2008, the
Constitutional Court upheld the legitimacy of Law no. 243/04. It
considered that the impugned law was an interpretative norm to the
provisions of law no. 503/92 which eradicated perequazione
aziendale for all pensioners, irrespective of their date of
retirement. Indeed, the interpretative nature of the norm was evident
since it had confirmed one of the possible meanings of the original
1992 text, which had also been upheld in some jurisprudence. The
impugned law had been reasonable because it aimed to achieve
recognition of an equal and homogenous treatment of all pensioners
under the current integrative regimes. Moreover, this law had not
augmented contentious proceedings since it had rendered their outcome
foreseeable. As to the other inconveniences mentioned by the Court of
Cassation, it considered that these arose from a random number of
circumstances and was not sufficient to consider the norm
unconstitutional. It further considered that the legislator could
enact interpretative laws, once they were based on one of the
possible meanings of the original text even if there had been
consistent jurisprudence about the matter, and this did not affect
the role of the Court of Cassation.
II. RELEVANT DOMESTIC LAW
- Law
no. 218 of 30 July 1990, in so far as relevant, reads as follows:
Section 1
“Employees of public banks will remain subject to
the provisions in force on the date of the entry into force of the
present law, up to the renewal of the national collective bargaining
contract applicable to the relevant category or up to the stipulation
of a new additional corporate contract.
Section 2
The foregoing is without prejudice to the said
employees’ acquired rights, effects of special laws or laws
pertaining to the original nature of the relevant public entity.”
- Sections
3 and 4 of Law no. 357 of 20 November 1990, in so far as relevant,
read as follows:
Section 3
“(3) The pension rates to be paid by
the special management system are subject to automatic equalisation
of the compulsory general insurance.
(4) Those entitled to pensions or other
insurances (in accordance with paragraph 1 ((registration with
INPS of bank employees)) retain their right to the more
favourable global welfare treatment as provided for by the obligatory
invalidity, old-age and survivors’ insurance as provided in the
following Article.
Section 4
(1) ... is made without prejudice to a more
favourable global welfare payment as provided for by the compulsory
invalidity, old age and survivors insurance ... which remains
applicable.
(2) The difference between the global welfare
payments mentioned in paragraph 1 (tempo per tempo determinato)
and the pension, or rate of pension, to be covered by the special
management system (according to paragraphs 2 and 3), as increased by
automatic equalisation, is to be paid by the employer.”
- Section
3 paragraph 1 of Law no. 421/92 delegated to the Government the
enactment of the relevant law in accordance with the following
principles, which in so far as relevant read as follows:
“(p) the principles and criteria
mentioned above (...) apply to employees as mentioned in section 2 of
Law no. 357/90 (persons in employment on 31 December 1990)”
- Section
9 paragraphs 2 and 3, of Law no. 503/92, in so far as relevant, reads
as follows:
“(2) Sections 2, 3, 8, 10, 11, 12, and
13 apply with respect to supplementary company regimes with which the
employees as mentioned in section 2 of Law no. 357/90 (persons
in employment on 31 December 1990) are registered.
(3) Variation to pension payments as a result
of paragraph 2 weigh upon the global sum (in accordance with section
4 of Law no. 357/90) unless otherwise agreed through collective
bargaining.”
- Section
1 paragraph 55 of Law no. 243/04 (regarding pension norms in the
sector of public welfare, in support of complementary welfare and
stable occupation and for the reorganisation of welfare entities and
compulsory assistance), in so far as relevant, reads as follows:
“In order to extinguish the contentious judicial
litigation relative to payments corresponding to each category of
pensioners already registered under equivalent welfare regimes, by
means of a full recognition of an equal and homogenous payment to all
pensioners registered with the supplementary regimes in force,
section 3 (1) (p) of Law no. 421 of 23 October 1992 and Article 9 (2)
of Legislative Decree no 503 of 30 December 1992, applies to the
global payment received by the pensioners in accordance with Article
3 of Legislative Decree no. 357 of 20 November 1990. The relevant
expense is to be borne by the obligatory general insurance.”
THE LAW
I. PRELIMINARY ISSUE
- The Court notes at the outset that the first and third
applicants died on unspecified dates after the lodging of their
application, while the case was pending before the Court. Their heirs
informed the Court that they wished to pursue the application lodged
by them (see paragraph 5 above). Although the heirs of a deceased
applicant cannot claim a general right for the examination of the
application brought by the latter to be continued by the Court (see
Scherer v. Switzerland, 25 March 1994, Series A no. 287), the
Court has accepted on a number of occasions that close relatives of a
deceased applicant are entitled to take his or her place (see
Epiphaniou and Others v. Turkey, no. 19900/92, § 18, 22
September 2009 and Taylan and Others v. Turkey, nos. 9209/04,
40056/04 and 22412/05, 14 September 2010).
- For the purposes of the instant case, the Court is
prepared to accept that the heirs of the first and third applicants
can pursue the application initially brought by Mr Arras and Mr
Dessi.
II. ALLEGED VIOLATION OF ARTICLE 6 OF THE CONVENTION
- The
applicants complained that Law no. 243/04 as interpreted by the Court
of Cassation on 23 October 2006, constituted a legislative
interference with pending proceedings which was in breach of their
fair trial rights under Article 6 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 ...”
- The
Government contested that argument.
A. Admissibility
- 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.
B. Merits
1. The parties’ submissions
- The
applicants submitted that the enactment of Article 1 paragraph 55
of Law no. 243/04 (which they considered a legal mess in its
formulation and which had been furtively presented in parliament)
appeared to interpret a 1992 norm, but in reality amended its content
with retroactive effect after twelve years of its application.
According to the applicants, its sole purpose was to thwart the
consolidated interpretative orientation which had been adopted by the
domestic courts (including the highest court – the Court of
Cassation in its ultimate formation, sitting as a full court), namely
that the relevant provisions of the 1992 law did not apply to persons
who had retired by 13 December 1990. Following the enactment of Law
no. 243/04 the domestic courts were bound to find against the
applicants. Thus, the State had influenced the result of proceedings,
defining their merit and rendering further hearings useless,
violating the independence of the judiciary and interfering in the
administration of justice. Indeed, the introduction of the 1997 law
only confirmed that the 1992 law had not abolished harmonisation
regarding long-standing pensioners. Otherwise there would have been
no need to enact such law. Neither would there have been need to
intervene again in 2004. The State had felt the need to introduce the
2004 legislation only because the courts had adopted a unanimous
orientation in favour of the applicants and persons in their
position. In this light, according to the applicants such a law could
not have been foreseeable.
- The
applicants pointed out that there had been no general interest
justifying the adoption of Law no. 243/04 which aimed to eliminate
retroactively already acquired rights. They noted that the relevant
expense in their cases was not borne by the INPS but by the Private
Supplementary Fund which was derived from paid up contributions from
the employers. Thus, the general public had not benefited in any way,
it was solely the two private banks which had benefited since they
were able to recover or save the sums which the domestic judges had
deemed to be due to pensioners such as the applicants. Moreover, this
law only affected pensioners from the two mentioned banks and thus
was consciously directed to affect these specific disputes. It
therefore had nothing to do with a general pension reform, namely the
harmonisation following Law no. 449/97, and in fact the applicants
were not contesting the effects of that law.
- The
Government submitted that there had not been a violation of Article
6. Indeed, the Naples Court of Appeal had found in the applicants’
favour, attributing to them the right to perequazione aziendale
for the relevant period. While it was true that the Court of
Cassation had reversed this decision on appeal, this had been done
upon consideration that the laws that had allowed perequazione
aziendale had been changed in 1992 by means of laws that aimed to
limit public expenditure and to eliminate once and for all this type
of perequazione in order to rationalise the novel social
security system following the privatisation of banking entities.
Moreover, it had been necessary to align national jurisprudence on
the matter which had been conflicting. In particular, the State felt
bound to satisfy the aim of having a homogenous pension system.
- The
Government submitted that most western states had needed to reform
their pension systems which had become unsustainable. Law no. 243/04,
together with other laws, had not been aimed at influencing judges’
determination of pending litigation, but had been part of a general
reform of national relevance. Thus, the Court of Cassation had
changed its view following legislative reforms approved by Parliament
which, being an expression of the people, had the right and the duty
to promote the reforms it considered necessary.
- The
Government considered that if such reforms had to be contrary to the
Convention, then the States would never be able to undertake any
reforms. In the present case, the aim of such a law was to abolish a
system which had favoured some over others. It was therefore for the
Court to determine whether the circumstances of the case had given
rise to a violation, bearing in mind the margin of appreciation of
the State.
2. The Court’s assessment
- The Court has repeatedly ruled that although the
legislature is not prevented from regulating, through new
retrospective provisions, rights derived from the laws in force, the
principle of the rule of law and the notion of a fair trial enshrined
in Article 6 preclude, except for compelling public-interest reasons,
interference by the legislature with the administration of justice
designed to influence the judicial determination of a dispute (see,
among many other authorities, Stran Greek Refineries and Stratis
Andreadis v. Greece, 9 December 1994, § 49, Series A no.
301-B; National & Provincial Building
Society, Leeds Permanent Building Society and Yorkshire
Building Society v. the United Kingdom, 23 October 1997, § 112,
Reports 1997-VII; and Zielinski and Pradal and Gonzalez and
Others v. France [GC], nos. 24846/94 and 34165/96 to 34173/96, §
57, ECHR 1999-VII). Although statutory pension regulations are liable
to change and a judicial decision cannot be relied on as a guarantee
against such changes in the future (see Sukhobokov v. Russia,
no. 75470/01, § 26, 13 April 2006), even if such changes are to
the disadvantage of certain welfare recipients, the State cannot
interfere with the process of adjudication in an arbitrary manner
(see, mutatis mutandis, Bulgakova v. Russia, no.
69524/01, § 42, 18 January 2007).
- While
it is true that in the present case, unlike in other cases of
legislative interference before the Court (see, for example, Stran
Greek Refineries, cited above) the State was not a party to the
proceedings, this does not preclude an assessment on the
circumstances of the case (see, for example, Vezon v. France,
no. 66018/01, 18 April 2006, and Ducret v. France, no.
40191/02, 12 June 2007).
- The
problem raised in the instant case is fundamentally that of a fair
trial, and in the Court’s opinion, the State’s
responsibility is engaged both in its legislative capacity, if it
vitiates the trial or affects the judicial outcome of the dispute,
and in its capacity as a judicial authority where the right to a fair
trial is violated, including in private law cases between private
individuals (see Vezon, cited
above § 30, and Ducret, cited above, § 34).
- The
Court reiterates that 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, Stran Greek Refineries, cited above, §
44 and Forrer-Niedenthal v. Germany, no. 47316/99, §
65, 20 February 2003).
- In
the instant case, the Court notes that Law no. 243/04 did not concern
decisions that had become final and it settled once and for all the
terms of the disputes pending before the ordinary courts
retrospectively. Thus, its enactment in reality determined the
substance of the disputes and the application of it by the various
ordinary courts made it pointless for an entire group of individuals
in the applicants’ position to carry on with the litigation.
- In
these circumstances the Court considers that there cannot be said to
have been equality of arms between the two private parties as the
State found in favour of one of the parties when it enacted the
impugned legislation.
- The Court further reiterates that only compelling
general interest reasons could be capable of justifying interference
by the legislature. Respect for the rule of law and the notion of a
fair trial require that any reasons adduced to justify such measures
be treated with the greatest possible degree of circumspection (see
Stran Greek Refineries, cited above, § 49).
- The
Court notes that the domestic courts had consistently applied
jurisprudence in favour of the applicants, and this was confirmed
also by the Court of Cassation in its highest formation, therefore it
cannot be said that there had been diverging jurisprudence as claimed
by the Government. As to their argument that the law had been
necessary to achieve a homogenous pension system, in particular by
abolishing a system which favoured some over others, while the Court
accepts this to be a reason of some general interest, it is not
persuaded that it was compelling enough to overcome the dangers
inherent in the use of retrospective legislation, which has the
effect of influencing the judicial determination of a pending
dispute. The Government have submitted no other arguments capable of
justifying such an intervention in favour of the Banco di Napoli.
- In
conclusion, bearing in mind the above, there was no compelling
general interest reason capable of justifying the legislative
interference which applied retroactively and determined the outcome
of the pending proceedings between private individuals.
- There
has therefore been a violation of Article 6 § 1.
III. ALLEGED VIOLATION OF ARTICLE 14 OF THE CONVENTION
- The
applicants complained that the legislative changes were
discriminatory in different ways. They relied on Article 14 of the
Convention, which in so far as relevant reads as follows:
“The enjoyment of the rights and freedoms set
forth in [the] Convention shall be secured without discrimination on
any ground such as sex, race, colour, language, religion, political
or other opinion, national or social origin, association with a
national minority, property, birth or other status.”
- The
Court notes that Article 6 is applicable to the present case and this
suffices to hold that Article 14 is also applicable.
- The
Court reiterates that a difference of treatment is discriminatory if
it has no objective and reasonable justification, in other words, if
it does not pursue a legitimate aim or if there is not a reasonable
relationship of proportionality between the means employed and the
aim sought to be realised. The Contracting State enjoys a margin of
appreciation in assessing whether and to what extent differences in
otherwise similar situations justify a different treatment. The scope
of this margin will vary according to the circumstances, the
subject-matter and the background (see Stec and Others, [GC],
nos. 65731/01 and 65900/01, § 51, ECHR 2006-VI).
A. Vis-à-vis
persons still employed
- The
applicants submitted that the changes treated persons in different
situations in the same way. Indeed, the applicants had by then
already reached pensionable age and unlike persons still employed,
they could not receive any benefits which according to the reform
could be acquired during working life, such as incentives in terms of
contributions and taxation to stipulate a supplementary pension and
to set up individual pension schemes, together with strengthening
their retirement position through collective agreements. The impugned
legislative changes affecting persons who were then 85 years of age
had the sole intention of affecting specified subjects to the
advantage of the two above-mentioned banks just before they were to
be taken over by a powerful banking group with exceptional influence.
- The
Government submitted that the retention of perequazione aziendale
to the benefit of the applicants, in the context of a general pension
reform, would have been in contradiction with the principle of
equality of treatment of all pensioners. Thus, the reform had only
aimed to remove an added benefit which had only been applicable to
the applicants and not to other pensioners.
- The
Court notes that discrimination may arise where States without an
objective and reasonable justification fail to treat differently
persons whose situations are significantly different (see Thlimmenos
v. Greece [GC], no. 34369/97, § 44, ECHR 2000-IV).
However, the Contracting State enjoys a margin of appreciation in
assessing whether and to what extent differences in otherwise similar
situations justify different treatment (see Van Raalte v. the
Netherlands, 21 February 1997, § 39, Reports of Judgments
and Decisions 1997-I). The scope of this margin will vary
according to the circumstances, the subject matter and the background
(see Petrovic v. Austria, 27 March 1998, § 38, Reports
1998-II).
- While
it is true that the applicants pertained to a group of persons who
had already retired and who therefore could not make up their
reduction in pension (as a consequence of Law no. 243/04) by means of
other benefits which other persons still employed could obtain
throughout their working life, the Court notes that the aim of Law
no. 243/04 was to achieve an equality of treatment of all pensioners,
current and future. Moreover, the Court notes that a wide margin is
usually allowed to the States under the Convention when it comes to
general measures of economic or social strategy (see, for example,
James and Others v. the United Kingdom, 21 February 1986, §
46, Series A no. 98). It follows that, even if the principle derived
from Thlimmenos were applied to the applicants’
situation, there is, in the Court’s view, objective and
reasonable justification for not distinguishing in law between
persons who had already begun to receive a pension and others who
were still working.
- Thus,
this part of the complaint must be rejected as being manifestly
ill-founded pursuant to Article 35 §§ 3 and 4 of the
Convention.
B. Vis-à-vis other pensioners who had
been working for other former public banks
- The
applicants claimed that they had been discriminated against vis à-vis
other pensioners who had been working for other former public banks,
as certain favourable legal provisions had been made to the exclusion
of the former employees of the Banco di Napoli (the Salvabanco law).
- The
Court reiterates that in order for an issue to arise under Article 14
there must be a difference in the treatment of persons in analogous
or relevantly similar situations (see D.H. and Others v. the Czech
Republic [GC], no. 57325/00, § 175, ECHR 2007, and Burden
v. the United Kingdom [GC], no. 13378/05, § 60, ECHR 2008).
- The
Court notes that under this complaint, the difference complained of
appears to relate to the fact that while employees of the Banco di
Napoli were originally entitled to (but eventually denied)
perequazione aziendale from 1 January 1994 to 26 July 1996 as
a consequence of the Salvabanco Law, other former employees of other
public banking entities were originally, and remained, entitled to
this benefit from 1 January 1994 to December 1997.
- Both
in so far as the complaint relates to the fact that the legislative
interference caused the applicants - as Banco di Napoli employees -
to receive a different treatment from that of other employees of
public banking entities in general, to whom the relevant laws did not
apply, and in so far as it relates to the duration of this
entitlement, the Court notes that because of their history in the
Italian system the employees of the Banco di Napoli (and the Banco di
Sicilia) cannot be considered to be in an analogous position to that
of employees of other public banking entities.
- It
follows, that this part of the complaint must be rejected as being
manifestly ill-founded pursuant to Article 35 §§ 3 and 4 of
the Convention.
C. Vis-à-vis other pensioners whose
domestic proceedings had terminated
- The
applicants alleged that a further discrimination had arisen, between
pensioners of the Banco di Napoli whose domestic proceedings had
terminated before the change of case-law, and those who were still
pursuing proceedings.
- See
paragraph 54 above in respect of the Government’s submissions.
Moreover, the Government made reference to the court’s findings
in Maggio and Others v. Italy (nos. 46286/09, 52851/08,
53727/08, 54486/08 and 56001/08, 31 May 2011)
which concerned similar circumstances.
- The
Court has previously held that the choice of a cut-off date when
transforming social security regimes must be considered as falling
within the wide margin of appreciation afforded to a State when
reforming its social strategy policy (see Twizell v. the United
Kingdom, no. 25379/02, § 24, 20 May 2008). However,
what needs to be considered is whether in the instant case the
impugned cut-off date arising out of the application of Law no.
243/04 can be deemed reasonably and objectively justified.
- While
in the present case, the justification is not as strong as that in
the Maggio case invoked by the Government, the Court is ready
to accept that Law no. 243/04 was intended to level out any
favourable treatment arising from the previous application of the
provisions in force, which had guaranteed to persons in the
applicants’ position a higher adjustment, namely a perequazione
aziendale as opposed to legale. The Court reiterates that
in creating a scheme of benefits it is sometimes necessary to use
cut-off points that apply to large groups of people and which may to
a certain extent appear arbitrary (see Twizell, cited above, §
24). While it is true that in the present case the impugned
legislation affected a smaller number of people, mainly octogenarians
who were previously employed by the Banco di Napoli and whose
proceedings were still pending, the Court considers that,
particularly bearing in mind the wide margin of appreciation afforded
to States in this sphere, the impugned cut-off date can be deemed
reasonably and objectively justified.
- The
fact that the impugned cut-off date arose out of legislation enacted
pending the applicants’ proceedings does not alter the above
conclusion for the purposes of the examination under Article 14.
-
It follows that, this part of the complaint must be rejected as being
manifestly ill-founded pursuant to Article 35 §§ 3 and 4 of
the Convention.
III. ALLEGED VIOLATION OF ARTICLE 1 OF PROTOCOL NO. 1 TO
THE CONVENTION
- The
applicants further complained that such a measure constituted an
arbitrary interference with their possessions. They relied on Article
1 of Protocol No. 1 to the Convention, which in so far as relevant
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.”
- The
Government contested that argument.
A. The parties’ submissions
- The
applicants submitted that the retroactive legislation constituted a
retroactive expropriation of their possessions, namely acquired
rights which had matured thirteen years earlier. It compared the
situation with the case of Agrati and Others v. Italy, nos.
43549/08, 6107/09 and 5087/09, 7 June 2011),
save that in the present case there had been no public interest.
- The
Government submitted that applying a system of perequazione legale
as opposed to aziendale could not constitute an illegitimate
interference with property under Article 1 of Protocol No. 1 since
the provision allowed States to enforce such laws as deemed necessary
to control the use of property in accordance with the general
interest. Indeed, according to the Court’s case-law, even
assuming that Article 1 of Protocol No. 1 guarantees benefits to
persons who have contributed to a social insurance system, it cannot
be interpreted as entitling that person to a pension of a particular
amount (Kjartan Ásmundsson v. Iceland, no. 60669/00,
§ 39, ECHR 2004-IX). Moreover, the Government noted that the
applicants’ salaries were still subject to adjustment according
to the cost of living, thus safeguarding their purchasing power. They
further submitted that the aim of the law was to harmonise the
pension system, by treating equally all pensioners, and abolishing a
distinction between those who had retired before 31 December 1990 and
those who retired later. Moreover, the burden imposed on the
applicants had been limited and proportionate. The Government made
reference to the Court’s case-law on this matter, particularly
the case of Maggio and Others v. Italy (nos. 46286/09,
52851/08, 53727/08, 54486/08 and 56001/08, 31 May
2011).
B. The
Court’s assessment
1. General
Principles
- The
Court reiterates that, according to its case-law, an applicant can
allege a violation of Article 1 of Protocol No. 1 only in so far as
the impugned decisions relate to his “possessions” within
the meaning of that provision. “Possessions” can be
“existing possessions” or assets, including, in certain
well-defined situations, claims. For a claim to be capable of being
considered an “asset” falling within the scope of Article
1 of Protocol No. 1, the claimant must establish that it has a
sufficient basis in national law, for example where there is settled
case-law of the domestic courts confirming it. Where that has been
done, the concept of “legitimate expectation” can come
into play (see Maurice v. France [GC], no. 11810/03, §
63, ECHR 2005 IX).
- Article 1 of Protocol No. 1 does not guarantee as such
any right to become the owner of property (see Van der Mussele v.
Belgium, 23 November 1983, § 48, Series A no. 70;
Slivenko v. Latvia (dec.) [GC], no. 48321/99, § 121,
ECHR 2002-II; and Kopecký v. Slovakia [GC],
no. 44912/98, § 35 (b), ECHR 2004-IX). Nor does it
guarantee, as such, any right to a pension of a particular amount
(see, for example, Kjartan Ásmundsson v. Iceland,
no. 60669/00, § 39, ECHR 2004-IX; Domalewski v. Poland
(dec.), no. 34610/97, ECHR 1999-V; and Janković v. Croatia
(dec.), no. 43440/98, ECHR 2000-X). However, a “claim”
concerning a pension can constitute a “possession” within
the meaning of Article 1 of Protocol No. 1 where it has a sufficient
basis in national law, for example where it is confirmed by a final
court judgment (see Pravednaya v. Russia, no. 69529/01,
§§ 37-39, 18 November 2004; and Bulgakova, cited
above, § 31).
- The
Court reiterates that Article 1 of Protocol No. 1 comprises three
distinct rules: “the first rule, set out in the first sentence
of the first paragraph, is of a general nature and enunciates the
principle of the peaceful enjoyment of property; the second rule,
contained in the second sentence of the first paragraph, covers
deprivation of possessions and subjects it to certain conditions; the
third rule, stated in the second paragraph, recognises that the
Contracting States are entitled, amongst other things, to control the
use of property in accordance with the general interest. The three
rules are not, however, “distinct” in the sense of being
unconnected. The second and third rules are concerned with particular
instances of interference with the right to peaceful enjoyment of
property and should therefore be construed in the light of the
general principle enunciated in the first rule” (see, among
other authorities, James and Others v. the United Kingdom, 21
February 1986, § 37, Series A no. 98; Iatridis v. Greece
[GC], no. 31107/96, § 55, ECHR 1999-II; and Beyeler v. Italy
[GC], no. 33202/96, § 98, ECHR 2000 I).
- An essential condition for interference to be deemed
compatible with Article 1 of Protocol No. 1 is that it should be
lawful. Moreover, any interference by a public authority with the
peaceful enjoyment of possessions can only be justified if it serves
a legitimate public (or general) interest. Because of their direct
knowledge of their society and its needs, the national authorities
are in principle better placed than the international judge to decide
what is “in the public interest”. Under the system of
protection established by the Convention, it is thus for the national
authorities to make the initial assessment as to the existence of a
problem of public concern warranting measures interfering with the
peaceful enjoyment of possessions
(see Terazzi S.r.l. v. Italy, no. 27265/95, §
85, 17 October 2002, and Wieczorek v. Poland, no.
18176/05, § 59, 8 December 2009). Article 1 of Protocol No. 1
also requires that any interference be reasonably proportionate to
the aim sought to be realised (see Jahn and Others v. Germany
[GC], nos. 46720/99, 72203/01 and 72552/01, §§ 81-94,
ECHR 2005-VI). The requisite fair balance will not be struck where
the person concerned bears an individual and excessive burden (see
Sporrong and Lönnroth v. Sweden, 23 September 1982, §§
69-74, Series A no. 52).
- Where
the amount of a benefit is reduced or discontinued, this may
constitute interference with possessions which requires to be
justified (see Kjartan Ásmundsson, cited above, §
40, and Rasmussen v. Poland, no. 38886/05, § 71, 28
April 2009).
2. Application to the present case
- The
Court firstly notes that the present case deals with pension
adjustments and not salaries arising out of a contractual
relationship as in the case of Agrati and Others cited by the
applicants. However, the Court does not consider it necessary to
decide whether the applicants had a possession within the meaning of
Protocol No. 1, as in any event it considers that there has been no
breach of Article 1 of Protocol No. 1 to the Convention for the
following reasons.
- The
Court has previously acknowledged that laws with retrospective effect
which were found to constitute legislative interference still
conformed with the lawfulness requirement of Article 1 of Protocol
No. 1 (see, for example, Maggio and Others v. Italy, nos.
46286/09, 52851/08, 53727/08, 54486/08 and 56001/08,
§ 60, 31 May 2011). It finds no reason to deem otherwise
in the present case. Reiterating that, because of their direct
knowledge of their society and its needs, the national authorities
are in principle better placed than the international judge to decide
what is “in the public interest”, the Court accepts that
the enactment of Law no. 243/04 pursued the public interest
(harmonising the pension system by treating equally all pensioners).
- In
considering whether the interference imposed an excessive individual
burden on the applicants, the Court has regard to the particular
context in which the issue arises in the present case, namely that of
a social security scheme. Such schemes are an expression of a
society’s solidarity with its vulnerable members (see, mutatis
mutandis, Goudswaard-Van der Lans v. the Netherlands
(dec.), no. 75255/01, ECHR 2005-XI). Nevertheless, the Court
notes that Law no. 243/04 did not affect the applicants’ basic
pension, and according to the laws in force their pension was still
to be augmented over the years according to a perequazione legale.
Accordingly, the applicants only lost the more favourable
augmentation according to a perequazione aziendale. Thus, the
Court considers that the applicants were obliged to endure a
reasonable and commensurate reduction, rather than the total
deprivation of their entitlements (see, conversely, Kjartan
Ásmundsson, cited above § 45).
- In
consequence, the measure at issue did not result in the impairment of
the essence of the applicants’ pension
rights. Moreover, this reduction only had the effect of equalizing a
state of affairs and avoiding unjustified advantages (resulting from
the Banco di Napoli employees having previously had more favourable
treatment) for the applicants and other persons in their position.
Against this background, bearing in mind the State’s wide
margin of appreciation in regulating the pension system and the fact
that the applicants endured commensurate reductions, the Court
considers that the applicants were not made to bear an individual and
excessive burden.
- It
follows that, even assuming the provision is applicable, the
complaint is manifestly ill-founded and must be rejected pursuant to
Article 35 §§ 3 and 4 of the Convention.
IV. APPLICATION OF ARTICLE 41 OF THE CONVENTION
- 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.”
A. Damage
- The
applicants claimed the differential pay-out that they would have
received had they not been subject to Law no. 243/04, up to 2010,
together with a hypothetical calculation for the years to come
according to official statistics on life expectancy and bearing in
mind that pensions are transferred to the surviving spouse following
death at the rate of 60% of the original pay-out. They therefore
claimed the following sums: Mr Arras 31,395.14 euros (EUR), Ms Dede
EUR 3,443.16, Mr Dessi EUR 8,599.25 and Mr Zizi EUR 174,822.19 in
respect of pecuniary damage. The applicants also claimed
non-pecuniary damage in an amount to be specified by the Court.
- The
Government have not submitted any comments in this respect.
- The
Court notes that in the present case an award of just satisfaction
can only be based on the fact that the applicants did not have the
benefit of the guarantees of Article 6 in respect of the fairness of
the proceedings. Whilst the Court cannot speculate as to the outcome
of the trial had the position been otherwise, it does not find it
unreasonable to regard the applicants as having suffered a loss of
real opportunities (see Zielinski, cited above, § 79 and
SCM Scanner de l’Ouest Lyonnais and Others v. France,
no. 12106/03, § 38, 21 June 2007). To that must be added
non-pecuniary damage, which the finding of a violation in this
judgment does not suffice to remedy. Making its assessment on an
equitable basis as required by Article 41, the Court awards EUR 9,000
to Mr Arras, EUR 5,500 to Ms Dede, EUR 6,000 to Mr Dessi and EUR
30,000 to Mr Zizi for all heads of damage combined.
B. Costs and expenses
- The
applicants also claimed EUR 41,043.51 plus tax under this head,
namely EUR 24,376.96 for the costs and expenses incurred before the
domestic courts and EUR 16,666.55 for those incurred before the
Court, plus all amounts due in taxes.
- The
Government made no comments in this respect.
- According
to the Court’s case-law, an applicant is entitled to the
reimbursement of costs and expenses only in so far as it has been
shown that these have been actually and necessarily incurred and are
reasonable as to quantum. In the present case, regard being had to
the documents in its possession and the above criteria, together with
the fact that the domestic courts only attributed half of the costs
to the applicants and that the Court only found a violation in
respect of Article 6, considers it reasonable to award the sum of EUR
19,000 covering costs under all heads.
C. Default interest
- The
Court considers it appropriate that the default interest rate should
be based on the marginal lending rate of the European Central Bank,
to which should be added three percentage points.
FOR THESE REASONS, THE COURT UNANIMOUSLY
- Declares the complaint under Article 6 § 1
admissible and the remainder of the application inadmissible.
- Holds that there has been a violation of Article
6 § 1 of the Convention;
- Holds
(a) that
the respondent State is to pay the applicants, within three months
from the date on which the judgment becomes final in accordance with
Article 44 § 2 of the Convention, the following
amounts
(i) EUR
9,000 (nine thousand euros), plus any tax that may be chargeable, to
the heirs of Mr Arras, jointly, in respect of pecuniary and
non-pecuniary damage;
(ii) EUR
5,500 (five thousand five hundred euros), plus any tax that may be
chargeable, to Ms Dede in respect of pecuniary and non-pecuniary
damage;
(iii) EUR
6,000 (six thousand euros), plus any tax that may be chargeable, to
the heirs of Mr Dessi, jointly, in respect of pecuniary and
non-pecuniary damage;
(iv) EUR
30,000 (thirty thousand euros), plus any tax that may be chargeable,
to Mr Zizi in respect of pecuniary and non-pecuniary damage;
(v) EUR
19,000 (nineteen thousand euros), plus any tax that may be chargeable
to the applicants, jointly, in respect of costs and expenses;
(b) that
from the expiry of the above-mentioned three months until settlement
simple interest shall be payable on the above amount at a rate equal
to the marginal lending rate of the European Central Bank during the
default period plus three percentage points;
- Dismisses the remainder of the applicants’
claim for just satisfaction.
Done in English, and notified in writing on 14 February 2012,
pursuant to Rule 77 §§ 2 and 3 of the Rules of Court.
Stanley Naismith Françoise Tulkens
Registrar President
