GROSSMANN AIR SERVICE BEDARFSLUFTFAHRTUNTERNEHMEN GMBH & CO KG v. AUSTRIA - 47199/10 (Judgment (Merits and Just Satisfaction) : Court (Fourth Section Committee)) [2016] ECHR 133 (02 February 2016)

In the case of Grossmann Air Service Bedarfsluftfahrtunternehmen GmbH & Co KG v. Austria,

The European Court of Human Rights (Fourth Section), sitting as a Committee composed of:

          Vincent A. De Gaetano, President,
          Egidijus Kūris,
          Gabriele Kucsko-Stadlmayer, judges,

and Fatoş Aracı, Deputy Section Registrar,

Having deliberated in private on 12 January 2016,

Delivers the following judgment, which was adopted on that date:

PROCEDURE

1. The case originated in an application (no. 47199/10) against the Republic of Austria lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (“the Convention”) by Grossmann Air Service Bedarfsluftfahrtunternehmen GmbH & Co Kg (“the applicant company”) on 10 August 2010.

2. The applicant company was represented by Mr P. Schmautzer, a lawyer practising in Vienna. The Austrian Government (“the Government”) were represented by their Agent, Ambassador H. Tichy, Head of the International Law Department at the Federal Ministry for European and International Affairs.

3. On 26 September 2012 the application was communicated to the Government.

THE FACTS

THE CIRCUMSTANCES OF THE CASE

4. The applicant company is a limited liability company which is registered in Austria and has its seat in Vienna.

5. In 1998 the Federal Finance Minister made a public call for tenders concerning flight services for delegations of the Federal Government. The applicant company submitted an offer, but simultaneously complained that the public tender was tailored towards one specific tenderer, namely the L. company. It was therefore revoked.

6. On 28 July 1998 an amended public call for tenders was issued. The applicant company did not submit an offer.

7. Upon request, the applicant company was informed that the Federal Government decided on 8 October 1998 to award the contract to the L. company. The respective contract was concluded on 29 October 1998.

8. On 19 October 1998, received by the Federal Procurement Authority (Bundesvergabeamt) on 27 October 1998, the applicant company requested to initiate review proceedings concerning the public call for tenders and to declare the awarding of the contract to the L. company null and void.

9. On 4 January 1999 the Federal Procurement Authority rejected the applicant company’s request, holding that it had failed to show its legal interest in the public tender.

10. On 2 March 1999 the applicant company filed a complaint with the Constitutional Court and asked it to seek a preliminary ruling from the Court of Justice of the European Union (CJEU) on the question of the existence of a legal interest.

11. On 10 December 2001 the Constitutional Court set aside the Federal Procurement Authority’s decision and held that it should have requested a preliminary ruling.

12. On 14 May 2002 the Federal Procurement Authority therefore requested a preliminary ruling from the CJEU.

13. On 12 February 2004 the CJEU issued a preliminary ruling, holding in essence that a person who did not participate in the public tendering proceedings due to an allegedly discriminatory call may still request their review.

14. On 30 November 2004 the Federal Procurement Authority again rejected the applicant company’s request.

15. On 10 January 2005 the applicant company filed a complaint with the Constitutional Court.

16. On 26 September 2005 the Constitutional Court declined to deal with the applicant company’s complaint, holding that it did not raise any questions of constitutional law, and transferred the case to the Administrative Court.

17. On 5 December 2005 the applicant company submitted its amended complaint to the Administrative Court.

18. On 29 October 2008 the Administrative Court set aside the Federal Procurement Authority’s decision, holding that the applicant company had been eligible to file a request for review proceedings.

19. On 2 July 2009 the applicant company filed a letter to the Auditor-General’s Department (Finanzprokuratur), asking whether the Republic of Austria would be interested in reaching a settlement in this case, referring to the Federal Procurement Authority’s inactivity after the Administrative Court’s last decision and the fact that the proceedings have already lasted for over ten years.

20. On 13 July 2009 the Auditor-General’s Department replied and requested the applicant company to specify their claims for compensation. It further stated that the applicant company could file an application against the Federal Procurement Authority’s failure to decide.

21. On 22 September 2009 the applicant company filed an application with the Administrative Court against the Federal Procurement Authority’s failure to decide (Säumnisbeschwerde).

22. On 30 September 2009 the Administrative Court requested the Federal Procurement Authority to issue, within three months, either a decision or to explain why it did not violate its duty to decide.

23. On 8 October 2009 a meeting took place between the parties, but no settlement could be reached.

24. On 22 December 2009 the Federal Procurement Authority issued its decision, finding that awarding the contract to the L. company in the public tender proceedings had not been unlawful.

25. On 24 February 2010 the Administrative Court discontinued the proceedings concerning the applicant company’s application filed against the Federal Procurement Authority’s failure to decide as the latter had issued its decision on 22 December 2009, but awarded the applicant company the legal costs.

26. On 1 February 2010 the applicant company filed a complaint with the Administrative Court.

27. On 25 March 2010 the Administrative Court declined to deal with the complaint. It held that the impugned decision had not deviated from the Administrative Court’s case-law and that the complaint did not raise any legal questions of fundamental significance.

28. This decision was served on the applicant company’s counsel on 8 April 2010.

THE LAW

I. ALLEGED VIOLATION OF ARTICLE 6 § 1 OF THE CONVENTION

29. The applicant complained that the length of the proceedings had been incompatible with the “reasonable time” requirement, laid down in Article 6 § 1 of the Convention, which reads as follows:

“In the determination of his civil rights and obligations ..., everyone is entitled to a ... hearing within a reasonable time by [a] ... tribunal...”

30. The Government contested that argument.

31. The period to be taken into consideration began on 19 October 1998 when the applicant requested the Federal Procurement Authority to review the public tendering proceedings and ended on 8 April 2010 when the final domestic decision was served on the applicant company’s counsel. However, the Court notes that the case was pending before the Court of Justice of the European Union for a preliminary ruling for one year and nine months, a period which, according to the Court’s case-law, is to be excluded from the length attributable to the domestic authorities (see Pafitis and Others v. Greece, 26 February 1998, § 95, Reports of Judgments and Decisions 1998-I). When deducting this duration from the overall duration, the impugned proceedings lasted nine years and almost nine months, during which the case came before one administrative and two judicial bodies, including remittals.

A. Admissibility

32. 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

33. The applicant company claimed that the excessive procedural duration was due to the fact that one to three years lay in between the decisions taken by the authorities. The attempts made to reach a settlement in the present case did not contribute to the length of the proceedings.

34. The Government argued that the authorities had had to deal with complex questions of law, which had necessitated a preliminary ruling by the CJEU. Further, the domestic authorities could not be held responsible for the duration during which the case was pending before the CJEU. The Constitutional Court and also the Administrative Court in the first and third set of proceedings had dealt with the complaints expeditiously. As for the second set of proceedings before the Administrative Court, the Government claimed that the court had had to deal with extremely complex questions of law and also with an extraordinary workload at that time. Lastly, the proceedings before the Federal Procurement Authority would have been conducted more rapidly in the last set of proceedings, had the applicant company not signalled its readiness to reach a settlement. Therefore, the procedural duration was still in compliance with the “reasonable time” requirement.

35. The Court reiterates that the reasonableness of the length of proceedings must be assessed in the light of the circumstances of the case and with reference to the following criteria: the complexity of the case, the conduct of the applicant and the relevant authorities and what was at stake for the applicant in the dispute (see, among many other authorities, Frydlender v. France [GC], no. 30979/96, § 43, ECHR 2000-VII).

36. The Court has frequently found violations of Article 6 § 1 of the Convention in cases raising issues similar to the one in the present case (see Riepl v. Austria, no. 37040/02, 3 February 2005; Brunnthaler v. Austria, no. 45289/99, 29 June 2006; Bösch v. Austria, no. 17912/05, 3 May 2007).

37. Having examined all the material submitted to it, the Court considers that the Government have not put forward any facts or arguments capable of persuading it to reach a different conclusion in the present case. Having regard to its case-law on the subject, the Court considers that in the instant case the length of the proceedings was excessive and failed to meet the “reasonable time” requirement.

There has accordingly been a breach of Article 6 § 1.

II. OTHER ALLEGED VIOLATIONS OF THE CONVENTION

38. The applicant company further complained under Articles 6 and 13 that the Federal Procurement Authority held only one hearing and that the Administrative Court declined to deal with the merits of the case. Under Article 14, it complained that the contract was awarded to a publicly-owned company.

39. However, in the light of all the material in its possession, and in so far as the matters complained of are within its competence, the Court finds that these complaints do not disclose any appearance of a violation of the rights and freedoms set out in the Convention or its Protocols.

III. APPLICATION OF ARTICLE 41 OF THE CONVENTION

40. 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

41. The applicant company claimed 1,342,149.74 euros (EUR) in respect of pecuniary damage and EUR 50,000 in respect of non-pecuniary damage.

42. The Government contested these claims. As regards the claim for pecuniary damage, they argued that there was no causal link between the procedural duration and the claim for loss of profit. Concerning the claim for non-pecuniary damage, the Government claimed that the finding of a violation of a Convention right constituted in itself sufficient reparation.

43. The Court does not discern any causal link between the violation found and the pecuniary damage alleged; it therefore rejects this claim. On the other hand, the Court considers that the applicant company must have sustained non-pecuniary damage related to the violation found. Ruling on an equitable basis, it awards the applicant company EUR 8,000 under this head.

B. Costs and expenses

44. The applicant also claimed EUR 25,070.80 for the costs and expenses incurred in the domestic proceedings. No claim was made in relation to the proceedings before the Court.

45. The Government contested the claim, arguing that most of the costs were not incurred in order to prevent the violation found. Concerning the costs claimed for filing the application against the Federal Procurement Authority’s failure to decide, the Government pointed out that the Administrative Court had already awarded the applicant company EUR 773.20 in this respect.

46. The Court notes that only the costs incurred in an attempt to accelerate the proceedings, i.e. the application against the administrative authority’s failure to decide, can be regarded as having been necessary to prevent the violation found. However, the legal costs for this application were already reimbursed by the Austrian authorities (see paragraph 25). Therefore, the Court rejects the claim for costs and expenses in the domestic proceedings.

47. As the applicant company made no claim for costs incurred in the Convention proceedings, no award is made under this head.

C. Default interest

48. 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,

1. Declares the complaint concerning the length of the proceedings admissible and the remainder of the application inadmissible;

2. Holds that there has been a violation of Article 6 § 1 of the Convention;

3. Holds

(a) that the respondent State is to pay the applicant, within three months, the following amounts:

(i) EUR 8,000 (eight thousand euros), plus any tax that may be chargeable, in respect of non-pecuniary damage;

(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;

4. Dismisses the remainder of the applicant’s claim for just satisfaction.

Done in English, and notified in writing on 2 February 2016, pursuant to Rule 77 §§ 2 and 3 of the Rules of Court.

Fatoş Aracı Vincent A. De Gaetano
Deputy Registrar President

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