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UNIYA OOO AND BELCOURT TRADING COMPANY v. RUSSIA JUDGMENT
160. The Constitutional Court held that the temporary seizure of
property in criminal proceedings was permissible provided that there was an
ex post facto judicial review. However, where the seizure involved
definitive deprivation of property, a prior court review of such a measure
was necessary. In particular, such prior control was required where alcohol
had been seized for further processing or destruction on the grounds of the
danger it posed to public health. Article 82 did not, however, exclude prior
judicial control over such measures, when read in conjunction with other
provisions of the Code of Criminal Procedure and the Constitution itself.
(c) Complaint by Uniya under Article 125 of the CCrP about the destruction
of the alcohol
(i) First round
161. On an unspecified date Uniya lodged a complaint against the
decision of the investigator of 19 December 2002 to destroy the alcohol (see
paragraph 155 above).
162. By the decision of 22 October 2004 of the Baltiyskiy District Court,
confirmed on 7 December 2004 by the Kaliningrad Regional Court, the
decision to destroy the alcohol was found lawful.
(ii) Second round
163. On 17 October 2005, in the light of Constitutional Court Ruling
no. 97-O of 10 March 2005, the Presidium of the Kaliningrad Regional
Court quashed the earlier judgments and ordered the reopening of the
proceedings.
164. On 7 November 2005 the Baltiyskiy District Court examined the
complaint. Referring to the Ruling of the Constitutional Court of the
Russian Federation of 10 March 2005, the District Court held that the
destruction of the alcohol had been unlawful because it had been ordered by
the investigator without a court order. Furthermore, the law provided that
any seizure and subsequent destruction had to be authorised in separate
administrative proceedings. No such proceedings had been instituted in the
case at hand. Consequently, the Baltiyskiy District Court declared the
decision of the investigator of 19 December 2002 unlawful and quashed it.
That decision was not challenged, and entered into legal force.
6. Tort claim brought by Belcourt against Uniya
165. On an unspecified date Belcourt brought tort proceedings against
Uniya in the Kaliningrad Region Commercial Court, claiming damages for
its failure to pay for the second consignment of alcohol. In those
proceedings Uniya claimed that it was not its fault that the alcohol had been
seized by the authorities.
UNIYA OOO AND BELCOURT TRADING COMPANY v. RUSSIA JUDGMENT
33
166. On 4 December 2001 the Kaliningrad Region Commercial Court
awarded the plaintiff (Belcourt) USD 17,203,586 in damages
(USD 8,601,793 corresponding to the price of the alcohol lost and
USD 8,601,723 corresponding to the penalty). It found that sixty-two
containers of alcohol had been sold by Belcourt to Uniya. The contract of
sale provided that any unsold portion of the consignment could be returned
by the buyer to the seller. However, the consignment had neither been paid
for in full nor returned to Belcourt. The court noted in particular that Uniya
“had not denied that it had received [the alcohol] into its ownership”. The
fact that the consignment had been seized by the authorities was irrelevant,
since it was part of the professional risks incurred by Uniya. In analysing
the obligations of Uniya before Belcourt the commercial court took into
account the original agency agreement of 3 November 1997. That judgment
was not appealed against and became final.
167. It appears that Belcourt tried to seek forced execution of the
judgment of 4 December 2001 against Uniya. However, Uniya did not have
sufficient assets, so Belcourt obtained only RUB 17,835 under the writ of
execution issued by the commercial court. The remaining part of the award
was not paid, and the writ of execution was returned to Belcourt. It appears
that in the following years Belcourt did not try to resubmit the writ for
forced execution through the bailiffs’ service.
168. On 9 January 2003 Uniya and Belcourt concluded an agreement
whereby Uniya acknowledged its debt in the amount of RUB 548,450,322.
The level of the debt was set on the basis of the exchange rate of the United
States dollar, which on the day of the signature was RUB 31.88 to one
dollar.
7. Tort claims by Uniya against the State
(a) Proceedings before the commercial courts
(i) First round
169. On an unspecified date the first applicant company (Uniya) brought
proceedings against the State claiming damages for unlawful seizure on
22 April 1999 of the second consignment of alcohol (see paragraph 132
above).
170. On 21 May 2002 the Kaliningrad Region Commercial Court stayed
the proceedings pending the criminal investigation. On 14 August 2002 this
decision was upheld by the appeal court. On 22 October 2002 the
North-West Circuit Commercial Court upheld the findings of the lower
courts and held that it was impossible to rule on the issue of damage
allegedly caused by the investigating authorities to the applicant company
before the criminal investigation was over.