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The Human Rights Committee,
established under article 28 of the International Covenant on Civil and
Political Rights,
Meeting on 28 July 1989,
Having concluded its consideration of communication No. 207/1986, submitted
to the Committee by Yves Morael under the Optional Protocol to the
International Covenant on Civil and Political Rights,
Having taken into account all written information made available to it by
the author of the communication and by the State party,
Adopts the following:
Views under article 5, paragraph 4, of the Optional Protocol
1.1 The author of the communication (letters dated 5 June 1986 and 13
February 1987) is Yves Morael, a French citizen born in France in 1944, at
present residing in Paris. He claims to be a victim of violations by France
of article 14 (1) and (2) and articles 26 and 17 (1) of the International
Covenant on Civil and Political Rights. He is represented by counsel.
1.2 The author states that he is a businessman, and a former member of the
board and, later, managing director of the joint stock company "Sociate
anonyme des cartonneries mecaniques du Nord" (SCMN), which was a producer of
paper and cardboard, that had employed almost 700 persons in 1974. As a
consequence of the oil crisis in 1973 and because of increased competition
in the sector, the company suffered serious financial losses and, by
decision of 24 May 1974 of the Tribunal of Commerce of Dunkirk, it was
placed under judicial supervision (réglement judiciaire). On 25 June 1975,
the same Tribunal ordered the sale of assets (liquidation des biens sociaux),
an order upheld by the Court of Appeal of Douai 12 July 1975. On 11 July
1977, the Court of Cossation quashed the order, but on 3 July 1978 the Court
of Appeal of Amiens, in its turn, ordered the sale to proceed. In the
meantime, the company had resumed its activities.
1.3 The author further states that, as a shareholder (owning 3.16 per cent
of the company's shares) and as a member of the board of directors of the
company since 1978, he repeatedly criticized the policies of the then
Managing Director and informed the other shareholders of his written
protests in order to bring the serious situation to their attention. On 28
February 1979, the author resigned from his position as a member of the
board. On 30 June 1979, the then Managing Director resigned and the author
was named his successor by the general meeting of shareholders, effective 1
July 1979. Immediately thereafter, he took a number of measures designed to
save the company, including closing the Paris office, reducing his salary as
Managing Director by 33 per cent and increasing the sales price of the
company's products. These measures enabled the author to obtain a court
order for temporary suspension of proceedings (suspension provisoire de
poursuites) on 30 November 1979. However, when the author sought to reduce
the number of employees by approximately 10 per cent (54 posts), the
Inspectorate of Employment refused permission in most cases and a series of
strikes ensued, further increasing the company's losses. The author ceased
to act as Managing Director on 7 December 1979, and a temporary judicial
administrator was appointed. On 24 January 1980, the Tribunal of Commerce of
Dunkirk appointed another judicial administrator, Mr. Deladriere, who had
previously been on the board of SCMN, and who, according to the author, had
rendered the company's long-term prospects of survival very precarious by
failing to reinvest or modernize during his appointment. More importantly,
the author claims that it was during Mr. Deladriere's appointment
(1980-1983), that the company's liabilities surpassed its assets, that Mr.
Deladriere sold certain company assets at a price significantly below their
market value, and that he failed to disengage the company from the
obligation of paying FF 16,038,847 to ASSEDIC (employment insurance) after
the cessation Of production in January 1980. The author states that Mr.
Deladriere brought both civil and criminal proceedings against him and
claims that the allegations in the criminal proceedings were false and
defamatory; he adds that he was duly acquitted by the Tribunal correctionnel
of Dunkirk on 5 March 1982. He also states that similar allegations of
misuse of company funds, which were subsequently dismissed in the criminal
proceedings, had been improperly introduced in the civil proceedings by the
Public Prosecutor (Ministere public) in the hope of rebutting his claim that
he had exercised due diligence in the management of the company, and that
the Tribunal of Commerce had thus been misled. Moreover, the author claims
that the Tribunal of Commerce erred in taking a decision against him without
waiting for the judgement of the criminal court on the facts since a civil
action must be stayed while a criminal action is being prosecuted (le
criminel tient le civil en l'etat).
1.4 By judgement of 7 July 1981, the Tribunal of Commerce of Dunkirk found
that the author had failed to prove due diligence and ordered him to pay 5
per cent of the company's debts, which according to the accounts presented
to the Tribunal by the court-appointed administrator amounted in 1981 to FF
957,040, since the company's debts, including the ASSEDIC payments, were set
at FF 19,140,814.
1.5 The author alleges that the former French bankruptcy law, which was
applied to him, unjustly placed a presumption of fault on the defendant
(article 99of Act No. 67-563) and observes that the French Parliament
amended it on 25 July 1985 (effective 1 January 1986) eliminating that
presumption of fault. However, he did not benefit from the application of
the revised law.
1.6 The author appealed the judgement of the Tribunal of Commerce of
Dunkirk, claiming that a number of procedural errors had been committed by
the lower court and requesting a finding that he had exercised all due
diligence during his five months as Managing Director, and that he was not
liable for any part of the company's debts. In particular, he cited the
misuse of influence by the Public Prosecutor, who was allowed, in the civil
proceedings, to allude to accusations brought against him in the Tribunal
correctionnel and to introduce evidence stemming from the criminal
proceedings, in violation of article 11 of the French Code of Criminal
Procedure. In its order of 13 July 1983, the Court of Appeal of Douai, after
finding that the author had taken several measures in an effort to save the
company but had not succeeded, held him liable for the company's debts,
application of the presumption of fault incorporated in article 99 of the
old bankruptcy law. Furthermore, the Court of Appeal did not limit itself to
confirming the lower court's judgement that the author should pay 5 per cent
of the company's debts in 1981, or FF 957,040, and amended that judgement ex
officio by ordering him to pay FF 3 million. The author notes that he had
appealed in order to extinguish his liability and that the court-appointed
administrator had asked the Court of Appeal merely to confirm the lower
court's judgement. Notwithstanding, the Court of Appeal amended the
judgement in two ways, first, by basing itself on a financial statement
dated 15 February 1983, showing considerable higher net indebtedness (FF 30
million instead of the FF 19,140,814 in 1983 and, secondly, by increasing
his share of liability from 5 per cent (FF 1.5 million) to 10 per cent (FF 3
million). The author then appealed to the Court of Cassation, contending
that the Court of Appeal, while acknowledging his efforts, had erred in
finding that he had not exercised due diligence. The author argued that an
officer of a company can be required only to take measures but not to
guarantee the result. Moreover, the author claimed that he could only be
held responsible, if at all, for debts arising during his term as Managing
Director, whereas neither the lower court nor the Court of Appeal had ever
established what had been the company's debts on 1 July 1979, when he became
Managing Director, and on 7 December 1979, when he resigned. There was thus
no proof that the company's debts had increased under his management and
hence no legal basis for his condemnation. The author further claimed that
the Court of Appeal had infringed article 16 of the new Code of Civil
Procedure in basing itself on liabilities significantly higher than those
established by the lower court, without subjecting the new elements to
adversary proceedings. That article reads:
"The court must, in all circumstances, ensure the observance of, and itself
observe, the principle of adversary proceedings."
"In its decision, it may not admit grounds, explanations and documents
relied upon or produced by the parties unless they have been available to
the parties for contradictory debate."
"It may not base its decision on grounds it has raised ex officio with
having invited the parties to present their observations."
The author notes that at no time in the appeal proceedings were the parties
give an opportunity to present their observations on the higher indebtedness
figures on his own share of liability. On 2 May 1985, the Court of Cassation
rejected the author's appeal.
2.1 With respect to article 14 (1) of the Covenant, the author calls into
quest the French legal system, which, as it was applied to him, did not
guarantee a fair hearing, in particular because there was no "equality of
arms" in the procedure whereby companies are placed under judicial
supervision and because article 99 Act No. 67-563 placed an unfair
presumption of fault on company officers without requiring proof of their
actual misconduct. In this connection, the author contends that the Court of
Cassation wrongly interpreted the concept of due diligence by concluding
that any fault committed by the author necessarily excluded diligence, even
if he had not shown negligence in the exercise of his duties. The author
claims that this excessively severe interpretation of "due diligence" is
discriminatory against company officials, for whom an error of judgement
regarding economic developments is punished as if constituting negligence.
Placing an obligation on him to achieve a desired result, the author argues,
was tantamount to denying him any possibility of establishing that he had in
fact exercised due diligence. The author claims that it is grossly unfair to
hold him responsible for the company's financial condition, which was
already disastrous at the time he was appointed Managing Director and which
he sought to remedy by diligent efforts that were finally frustrated by
factors beyond his control, such as the refusal by the Inspectorate of
Employment of staff retrenchment measures and the ensuing strikes.
2.2 Another alleged violation of article 14 (1), the author claims,
consisted in the court's consideration of a new and higher amount for the
company's liabilities without giving him an opportunity to challenge it. He
further contends that the case was not heard within a reasonable time,
considering that the Tribunal of Commerce of Lille appointed its
administrator in January 1980 and the final decree of the Court of Cassation
was not handed down until May 1985. The author claims that had the procedure
been more expeditious, the level of the company's debts would have been
lower, especially as employees had been paid FF 16,038,847 even after the
company had ceased operations in January 1980.
2.3 With respect to article 14 (2), the author contends that article 99 of
Act No. 67-563 had not only a civil but also a penal character, and he
refers in this connection to the fact that the Public Prosecutor (Ministere
public) was heard during the proceedings before the Tribunal of Commerce of
Dunkirk. He further contends that the decision by the Court of Appeal
ordering him to pay FF 3 million francs amounts to a penal sanction. He
therefore claims that he should have enjoyed the presumption of innocence.
2.4 The author states that to the extent that he was a victim of violations
of article 14 by not having been given a fair hearing, he was also denied
the equal protection of the law, as provided by article 26 of the Covenant.
This, he claims, also constitutes a violation of article 17 (1), in that
there was an attack on his honour and reputation, in particular that the
proceedings against him tarnished his reputation as a company officer and
that he is now prohibited by the bankruptcy law from exercising many
managerial functions.
2.5 Lastly, the author emphasizes the fact that he was a victim of
violations of the Covenant subsequent to the entry into force of the
Optional Protocol for France (17 May 1984).
3. By its decision of 1 July 1986, the Working Group of the Human Rights
Committee, acting under rule 91 of its provisional rules of procedure,
transmitted the communication of Yves Morael to the State party, requesting
any information and observations relevant to the question of the
admissibility of the communication.
4.1 In a communication dated 1 December 1986 the State party concedes that
the author has "exhausted all domestic remedies within the meaning of
article 5, paragraph 2 (b), of the Optional Protocol" With regard to the
argumentation of the author and the merits of his claims, the State party
contends that the author's communication should be rejected as "manifestly
ill-founded".
4.2 The State party rejects the author's contention that the French courts
did not decide the case within a reasonable time, pointing out that the
Tribunal of Commerce delivered its judgement on 7 July 1981 and the Court of
Appeal announced its decision on 13 July 1983, upheld by the Court of
Cassation on 2 May 1985.
Given the complexity of the case and the fact that Mr. Morael used all the
remedies permitted by French law for such proceedings without displaying
particular eagerness, the courts, which were called upon to reach a decision
on three occasions in this case within a total period of less than four
years, have acted with all due dispatch.
4.3 With regard to the author's assertion that he was not given a fair
hearing owing to the presumption of fault established by article 99 of the
then applicable Act of 13 July 1967, the State party quotes the text of the
Act:
"When judicial supervision of the affairs of a body corporate or the sale of
its property reveals that its assets are insufficient, the court may decide,
on the petition of the court-appointed administrator, or even ex officio,
that the company's debts shall be borne, in whole or in part and jointly or
severally, by all or some of the managers of the company, whether de jure or
de facto, visible or undisclosed, remunerated or not. To be absolved of
their liability, such persons must show that they devoted all due energy and
diligence to the management of the company's affairs."
And the state party adds that "this procedure, commonly known as an action
for coverage of liabilities, thus introduces in respect of a company's
managers or some of them, a presumption of liability, there being a
shortfall in assets resulting from the failure of their management".
4.4 "In the view of the French Government, this presumption of liability
attached to a company's managers is not in conflict with the principle of a
fair hearing, contrary to the contention of the author. Admittedly, the
liability of the persons concerned may be invoked in this type of procedure
without presentation of proof of fault on the part of the managers. But that
is the case in any system of liability for risk or 'objective' liability.
Furthermore, the existence of such a presumption instituted by the Act is
not, in itself, in any way contrary to the rule of a fair hearing inasmuch
as the proceedings take place in conditions that ensure the full enjoyment
of his rights by the person concerned. What is more, in the case in
question, this presumption is not irrefragable, for the managers in question
can in fact absolve themselves of liability by proving by whatever means
that they devoted all due energy and diligence to the management of the
company's affairs. The tribunal, itself supervised by the Court of Appeal,
is free to evaluate such proof in the light of all the elements which had an
influence on the behaviour of the managers involved."
4.5 "It is for [the tribunal] to decide, on the petition of the receiver
(syndic) or ex officio, to make all or some of the company's managers,
jointly or severally assume all or part of the company's liabilities. The
tribunal is under no compulsion whatsoever to find against the persons
involved. If it does so it is free to determine the amount of the obligation
assessed to the managers at fault, on the sole condition that in its
decision it does not exceed the amount of the shortfall in assets. It is
also free to decide on the advisability of making the managers jointly
liable. In short, an action for coverage of liabilities in no way
constitutes an automatic sanction, but must rather be regarded as a
vicarious-liability action based on a presumption which can always be
contested by evidence to the contrary."
4.6 "In the present instance, the trial judges of the case considered that
Yves Morael 'had been instrumental in prolonging the life of the company
while at the same time worsening its indebtedness' and found that the
various measures taken by this manager 'with the aim of saving at all costs
a loss-making enterprise proved inadequate ..., that it follows that Yves
Morael cannot be deemed diligent within the meaning of article 99 of the Act
of 13 July 1967'. It thus emerges that in the course of the proceedings the
elements of proof furnished by Mr. Morael were examined so as to ensure a
fair hearing, which enabled the judges to evaluate the justification for the
action for coverage of liabilities brought by the official receiver. In
addition, the Government sees nothing to support the view that the case of
the author was not properly considered, or that the trial judges or the
appeal judges did not conduct the proceedings properly and fairly. We would
note on this connection that the rights of the defence were respected, the
person concerned attended the hearings, and that the procedure took place
before courts having all the guarantees of independence and impartiality
required by article 14 (1) of the Covenant."
4.7 With regard to the author's claim that the Court of Appeal of Douai
violated the principle of adversary proceedings by convicting him on the
basis of elements that became known after submission of the court-appointed
administrator's findings, the State party notes that the author does not
identify the elements in the file that were allegedly not the subject of
adversary proceedings. Furthermore, the Court of Cassation, in its decree of
2 May 1985, explicitly dismissed this argument when it stated that "the
Court of Appeal, in determining that, at the time it handed down its
decision, the liabilities of SCMN exceeded its assets, relied upon the
elements contained in the findings submitted by the court-appointed
administrator, in which the figures are identical, to within a few francs,
with whose of the statement of outstanding claims as ascertained on 15
February 1983, which was not the subject of any objection ... the Court of
Appeal thus ... did not ignore the principle of adversary proceedings ...".
4.8 With respect to the alleged violation of article 14 (2), the State party
observes that "the presumption of fault enunciated in article 99 of the Act
of 3 July 1967 is in no way contrary to article 14, paragraph 2, of the
Covenant". In an action for coverage of liabilities, "the verdict,
regardless of the amount involved, remains commensurate with the loss
suffered by the creditors and never has the character of a financial
penalty". Under no circumstances does an action or coverage of liabilities
"have a penal character, and acts constituting serious errors of management
do not as such constitute criminal offences. What is more, the Public
Prosecutor is not empowered to act in such a matter. Unless the court takes
up the question ex officio - which was not done in this case - only the
receiver may bring a petition for coverage of liabilities. But, the
presumption of innocence laid down in article 14, paragraph 2, applies
exclusively to criminal offences".
4.9 With respect to the alleged violation of article 14 (1) in conjunction
with articles 26 and 17 of the Covenant, the State party observes that the
author has failed to substantiate his allegations.
5.1 In a letter dated 13 February 1987 containing - in accordance with rule
91 of the provisional rules of procedure - the author's comments on the
observations of the State party, the author notes that the State party "does
not contest the admissibility of the communication" having regard to the
exhaustion of domestic remedies.
5.2 With regard to the substantiation of his grievances, the author takes
issue with most of the State party's arguments concerning the merits. Above
all, he draws the Committee's attention to the fact that "article 99 of the
Act of 13 July 1967 was the subject of a parliamentary debate in 1984 which
led to the adoption of the amended bankruptcy law of 25 January 1985". This
new Act, which was not applied to him, restores ordinary law in respect of
the burden of proof, eliminating the presumption of fault on the part of
company managers. That has two consequences in his case: first, the Court of
Cassation, in its ruling of 2 May 1985, did not apply the more lenient
system emerging from the new law of 25 January 1985. He was thus sentenced
to bear part of the company's liabilities on the basis of a statute
abandoned by the legislature less than four months earlier; secondly, the
debates both in the National Assembly and the Senate indicate that article
99 of Act No. 67-563 was deemed to violate the principles of "fair hearing"
and "presumption of innocence", and that eminent French professors of law
and legal experts called upon to testify at proceedings under that article
considered it to be distinctly penal in character.
5.3 The author quotes extensively from the debates in the French National
Assembly and requests the Committee to take into account the criticisms
voiced on that occasion before determining the scope of the concepts of
"fair hearing" and "presumption of innocence" guaranteed by the Covenant.
The following are excerpts from the debates in the National Assembly:
Mr. Robert Badinter, Minister of Justice at the time of the parliamentary
examination of article 99 and currently President of the Constitutional
Council, stated:
"Existing law is still burdened by the highly repressive influence of old
bankruptcy law. The present Act still regards [management] with suspicion.
It threatens company managers with numerous criminal penalties ... It
exposes them to liability for covering a company's indebtedness by
subjecting them to a presumption of fault contrary to the fundamental
principle of presumption innocence ..." (National Assembly, meeting of 5
April 1984, Compte rendu, p. 1180)
The author then quotes article 180 of the new bankruptcy law of 25 January
1985:
"When judicial reorganization or liquidation of a body corporate reveals
that its assets are deficient, the court may - where a fault of management
has contributed to such deficiency in assets - decide that the debts of the
body corporate shall be borne, in whole or in part, jointly or severally, by
all or some of the managers, whether de jure or de facto and whether or not
they are remunerated ..."
The author adds that the law was voted without any deputy objecting to the
adoption of that text.
5.4 With respect to the penal aspect of article 99 of the former bankruptcy
law, the author further observes:
"The action for coverage of liabilities is a complex action which is not
only intended to repair the loss suffered by creditors. It has a penal
aspect because of the seriousness of the financial consequences (in this
instance, 3 million francs for having been head of the company for a few
months), and its accessory disqualifications."
The author then quotes from a law report by Professor Bouloc of the
University of Paris:
"... Since a conviction ordering coverage of liabilities exposes the manager
to personal bankruptcy, to prohibition of performance of managerial
functions, to a procedure of judicial supervision or liquidation of personal
property, and even to criminal proceedings (article 132 of the Act of 1967),
it cannot be said that coverage of liabilities is purely and simply a civil
institution without any connection with the criminal law ..."
5.5 The author also cites the debates of the 20th Congress of the National
Association of Judicial Auditors (Compagnie nationale des experts
judiciaires en comptabilite) in 1981, which dealt with the practical
application of article 99 of the then applicable bankruptcy law and which
arrived at the following conclusion, inter alia:
"... article 99 can be seen to institute a penalty having no connection ...
with the desire to alleviate the loss suffered by the creditors: you
mismanaged the company placed under your direction, since you have filed for
bankruptcy. You will be punished, and the punishment will serve as an
example".
He thus concludes that the proceedings against him had a dual character, of
which the criminal law aspects should be taken into consideration in
relation to the terms and principles of the Covenant, which have a scope of
their own independent of national laws and other definitions.
6.1 Before considering the claims contained in a communication, the Human
Rights Committee must, in accordance with rule 87 of its provisional rules
of procedure, decide whether or not it is admissible under the Optional
Protocol to the Covenant.
6.2 The Committee found that the parties agreed that all domestic remedies
had been exhausted. It also ascertained that the same matter was not being
examined under another procedure of international investigation or
settlement. The communication therefore meets the requirements of article 5
(2) of the Optional Protocol.
6.3 With respect to the State party's conclusion that the communication
should be rejected as "manifestly ill-founded", the Committee noted that
article 3 of the Optional Protocol provides that a communication shall be
considered inadmissible if it is (a) anonymous, (b) constitutes an abuse of
the right of submission, or (c) is incompatible with the provisions of the
Covenant. The Committee found that the author had made a reasonable effort
to substantiate his complaints and that he invoked specific provisions of
the Covenant. Therefore, the Committee had to examine the issues raised,
when deciding on the merits of the case.
6.4 The Committee noted that both the author and the State party had already
presented numerous observations on the merits of the case. However, the
Committee deemed it appropriate at that juncture to limit itself, as the
rules of procedure required, to ruling on the admissibility of the
communication. It also noted that if the State party should wish to add to
its earlier submission within six months following notification of the
decision on admissibility, the author of the communication would be given
the opportunity to comment thereon. If no further submissions were received
from the State party under article 4 (2) of the Optional Protocol, the
Committee would proceed to adopt its final views in the light of the written
information already submitted by the parties.
7. Accordingly, on 10 July 1987, the Human Rights Committee decided that the
communication was admissible and requested the State party, should it not
intend submit further explanations or statements under article 4 (2),
paragraph 2, of the Optional Protocol, to so inform it, so as to enable it
to arrive at an early decision on the merits.
8. The deadline for the State party's submission of explanations or
statements under article 4 (2) of the Optional Protocol expired on 6
February 1988. On 29 April 1988, the secretariat sent a reminder to the
State party concerned. No further explanation or statement has been received
from the State party. The Committee therefore concludes, on the basis of
paragraph 2 of its decision on admissibility, that the State party does not
intend to submit any further explanations or statements.
9.1 The Human Rights Committee, having examined the merits of the
communication the light of all the information made available to it by the
parties, as provided in article 5 (1) of the Optional Protocol, decides to
base its views on the following facts, which are uncontested.
9.2 The author of the communication is a businessman and former member of
the board, and later Managing Director, of the joint-stock company "Societe
anonyme d cartonneries mecaniques du Nord". In 1973, the company began to
experience serious financial difficulties and a judicial administrator was
appointed. After a sale of some company assets to satisfy creditors in 1978,
the company resumed operations under a different management. Since it
continued to lose money, the general meeting of shareholders appointed the
author as Managing Director on 1 July 1979. He served in that capacity until
7 December 1979, when another judicial administrator was appointed. During
those five months he ordered several economy measures designed to save the
company, such as closing the Paris office and reducing the salary of the
Managing Director by 33 per cent; he also attempted to reduce personnel, but
this was unsuccessful owing to the partial refusal of the Inspectorate of
Employment and to strikes. During civil proceedings held on the petition of
the court-appointed administrator for an order for coverage of liabilities,
the Tribunal of Commerce of Dunkirk heard the Public Prosecutor (who made
reference to criminal proceedings then pending against the author,
subsequently acquitted of all charges by decision of the Tribunal
correctionnel of Dunkirk on 4 May 1982) and, on 7 July 1981, finding that
the author had not prove "that he had been diligent in the sense of article
99 of the Bankruptcy Act, ordered him to bear part of the company's
indebtedness, as established by operations of the procedure, in the
proportion of 5 per cent, together with other members of management, who
were jointly ordered to pay 35 per cent of the indebtedness. The author
appealed, petitioning the Court of Appeal to find that he had exercised all
due diligence during his five months as Managing Director. In its order of
13 July 1983, the Court of Appeal of Douai, while acknowledging that the
author had taken a number of measures, held that those measures, designed to
save a loss-making enterprise at any cost, had turned out to be inadequate
and that the author had helped, as Managing Director, to prolong the life of
the company while worsening its finances. Consequently, the Court,
considering that he had not demonstrated that he had exercised due
diligence, confirmed the lower court's judgement that the company's
indebtedness would partly be borne by its managers, while amending it as
concerns its fixing of the amount in percentages. Deciding to take as the
appropriate point for evaluating the shortfall in the company's assets the
date of 15 February 1983, when it had been definitively verified, without
challenge, at about FF 30 million, the Court set the sum to be charged the
author at FF 3 million, independently of the other managers. The author then
appealed to the Court of Cassation, arguing that the Court of Appeal had
erred in finding that he had not proven due diligence and that it had based
the determination of the shortfall on elements which had not been part of
the proceedings. On 2 May 1985, the Court of Cassation rejected the author's
appeal, finding that the Court of Appeal had established the facts correctly
and had based its decision on the verification of the statement of
liabilities, about which there had been no challenge, by the parties, and
that consequently it had not disregarded the principle of adversary
proceedings. Subsequently, article 180 of the new Bankruptcy Act, dated 25
January 1985 (and effective as from 1 January 1986), abolished the
presumption of fault, restoring the principle of proof of fault to determine
the responsibilities of company managers in case of losses.
9.3 The first question before the Committee is whether the author is victim
of a violation of article 14 (1) of the Covenant because, as he alleges, his
case did not receive a fair hearing within the meaning of that paragraph.
The Committee notes in this connection that the paragraph in question
applies not only to criminal matters but also to litigation concerning
rights and obligations of a civil nature. Although article 14 does not
explain what is meant by a "fair hearing" in a suit at law (unlike paragraph
3 of the same article dealing with the determination of criminal charges),
the concept of a fair hearing in the context of article 14 (1) of the
Covenant should be interpreted as requiring a number of conditions, such as
equality of arms, respect for the principle of adversary proceedings,
preclusion of ex officio reformatio in pejus,[FN1] and expeditious
procedure. The facts of the case should accordingly be tested against those
criteria.
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[FN1] Ex officio correction worsening an earlier verdict.
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9.4 At issue is the application of the third paragraph of the article of the
Bankruptcy Law of 13 July 1967 that established a presumption of fault on
the part of managers of companies placed under judicial supervision, by
requiring them to prove that they had devoted all due energy and diligence
to the management of the company's affairs, failing which they could be held
liable for the company's losses. The author claims in this regard that the
Court of Cassation had given too severe an interpretation of due diligence,
one that amounted to denying him any possibility of demonstrating that he
had exercised it. It is not for the Committee, however, to pass judgement on
the validity of the evidence of diligence produced by the author or to
question the court's discretionary power to decide whether such evidence was
sufficient to absolve him of any liability. As regards respect for the
principle of adversary proceedings, the Committee notes that to its
knowledge there is nothing in the facts concerning the proceedings to show
that the author did not have the possibility of presenting evidence at his
disposal or that the court based its decision on evidence admitted without
being open to challenge by the parties. As to the author's complaint that
the principle of adversary proceedings had been ignored in that the Court of
Appeal had increased the amount to be paid by the author, although the
change had not been requested by the court-appointed administrator and had
not been submitted to the parties for argument, the Committee notes that the
Court of Appeal fixed the amounts to be paid by the author on the basis of
the liabilities resulting from the operations of the procedure, as the court
of first instance had decided; that such verification of the statement of
liabilities had not been contested by the parties; and that the definitive
amount, while equal to approximately 10 per cent of the company's
indebtedness, had been charged to the author individually, whereas the court
of first instance had ordered payment jointly with other managers, which
might have required the author to pay 40 per cent of the company's
indebtedness in case it proved impossible to recover the shares due from his
co-debtors. In view of the above, it is to be doubted that there was an
increase in the amount charged to the author or that the principle of
adversary proceedings and preclusion of ex officio reformatio in pejus were
ignored. With respect to the author's assertion that the case was not heard
within a reasonable time, the Committee is of the opinion that in the
circumstances and given the complexity of a bankruptcy case, the time taken
by the domestic courts to deal with it cannot be considered excessive.
9.5 As to the complaint that the action for coverage of liabilities brought
against the author violated the principle of presumption of innocence laid
down in article 14. (2) of the Covenant, the Committee points out that that
provision is applicable only to persons charged with a criminal offence.
Article 99 of the former bankruptcy law entailed a presumption of
responsibility on the part of company managers in the absence of proof of
their diligence. But that presumption did not relate to any charge of a
criminal offence. On the contrary, it was a presumption relating to a system
of liability for risk resulting from a person's activities - one that is
well known in private law, even in the form of absolute objective liability
ruling out all evidence to the contrary. In the situation under
consideration, liability was established in favour of the creditors and the
amounts charged to the managers corresponded to the damages they had
suffered and were to be paid in order to cover the company's liabilities.
The object of article 99 of the Bankruptcy Act was to compensate creditors
but it also entailed other penalties which, however, were civil-law and not
criminal-law penalties. The provision concerning the presumption of
innocence in article 14 (2) cannot therefore be applied in the case under
consideration. That conclusion cannot be affected by the allegation that the
provision of article 99 of the Bankruptcy Act was subsequently modified by
elimination of the presumption of fault, considered unjust from the point of
view of the material settlement of liability, for this circumstance does not
of itself imply that the earlier provision contravened the above-mentioned
provisions of the Convention.
9.6 With respect to the complaints of violation of articles 26 and 17 (1) of
the Covenant, the Committee considers that the author has not demonstrated
that he was a victim of a violation of article 26, regarding equality before
the law or that the procedure followed by the French courts improperly
attacked his honour and reputation, protected by article 17.
9.7 The Human Rights Committee, acting under article 5, paragraph 4, of the
Optional Protocol to the International Covenant on Civil and Political
Rights, is of the view that the facts which have been put before it do not
disclose any violation of paragraphs 1 and 2 of article 14 of the Covenant. |
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