Right to a fair trial (Article 6 of the Convention)
II. Relevant domestic law A. The Ordinance on Direct Federal Tax 20. At the relevant time, tax evasion was punishable by a fine of up to four times the amount evaded, the fine being payable in addition to the amount due (Article 129 § 1 of the Ordinance on Direct Federal Tax). 21. Article 130 § 1 provided, inter alia : “If the evasion is discovered only after the death of the taxpayer, proceedings shall be brought against his heirs. Irrespective of personal guilt, the heirs shall be jointly liable for the deceased person’s evaded taxes and the fine incurred by him up to an amount not exceeding their share in the estate.” B. The Swiss Civil Code 22. According to Article 537 § 1 of the Swiss Civil Code, an inheritance passes upon the death of the deceased. 23. The relevant parts of Article 560 of the Swiss Civil Code provide: “1. The heirs shall automatically acquire the entire estate as soon as it passes. 2. Subject to the statutory exceptions, all claims and actions, property rights and other rights in rem and possessions of the deceased shall automatically pass to them, and they shall become personally liable for the deceased’s debts.” 24. Under Article 566 § 1 of the Swiss Civil Code, the heirs have the right to renounce the inheritance which has devolved to them. The time-limit for so doing is three months (Article 567 § 1). C. Procedure 25. It was open to the taxpayer to lodge an objection against an assessment of direct federal tax to the authority which had made it (Article 105 of the Ordinance on Direct Federal Tax). 26. An appeal against the decision given in the objection proceedings lay to the Cantonal Tax Appeals Board (Article 106). The Direct Federal Tax Department of the canton and the federal tax authorities could also bring such an appeal (Article 107). 27. An administrative-law appeal lies to the Federal Court against the decision of the Federal Tax Appeals Board (section 98 (e) of the Federal Judicature Act). Such an appeal may be lodged by both the tax debtor and the federal tax authorities (Article 112 of the Ordinance on Direct Federal Tax). 28. If the Federal Court orders an exchange of written pleadings, it asks the authority which gave the decision to forward the case file (section 110 (2) of the Federal Judicature Act), at the same time inviting it to submit its comments in writing (section 110 (1)). The cantonal authority which gave the last decision at cantonal level is also invited to comment (section 110 (3)), as is the federal authority which would itself have been entitled to lodge an appeal (section 110 (1)). 29. At the material time, section 109 (1) of the Federal Judicature Act made it possible for a three-judge Chamber of the Federal Court to dismiss an administrative-law appeal as manifestly ill-founded without a hearing, provided that its decision was unanimous. D. The Swiss Criminal Code 30. Under Article 333 § 1 of the Swiss Criminal Code, the general provisions of the Code apply to offences created by other federal laws unless the latter provide otherwise. 31. Article 48 § 3 of the Criminal Code provides that a fine lapses if the convicted person dies. However, pursuant to Article 333 § 1 of the Criminal Code, Article 130 § 1 of the Ordinance on Direct Federal Tax (see paragraph 21 above) derogates from this principle as a lex specialis. E. Subsequent developments 32. Section 179 (1) of the Federal Direct Taxation Act of 14 December 1990, in force since 1 January 1995, provides for the liability of heirs, inter alia, for any fines determined with legal force. According to section 179 (2), the heirs shall not be so liable if the tax-evasion proceedings are concluded after the death of the taxpayer, provided that the heirs themselves are guiltless and do what they can to enable the tax authorities to make a correct assessment. PROCEEDINGS BEFORE THE COMMISSION 33. Mrs A.P., Mr M.P. and Mr T.P. applied to the Commission on 13 March 1992. They relied on Article 6 §§ 1 and 2 of the Convention, complaining that, irrespective of any personal guilt, they had been convicted of an offence allegedly committed by Mr P. and that they had not had a fair and public hearing by an independent and impartial tribunal established by law. 34. The Commission declared the application (no. 19958/92) admissible on 16 October 1995. In its report of 18 April 1996 (Article 31), it expressed the opinion that there had been a violation of Article 6 § 1 of the Convention on account of the failure to hold a public hearing (twenty votes to eight) but not of Article 6 § 2 (seventeen votes to eleven). The full text of the Commission’s opinion and of the eight separate opinions contained in the report is reproduced as an annex to this judgment [5]. FINAL SUBMISSIONS TO THE COURT BY THE GOVERNMENT 35. The Agent of the Government, speaking at the Court’s hearing, asked the Court to find that there had not been a breach of the requirements of Article 6. AS TO THE LAW I. ALLEGED VIOLATION OF ARTICLE 6 § 2 OF THE CONVENTION 36. The applicants alleged that, irrespective of any personal guilt, they had been convicted of an offence allegedly committed by someone else, contrary to Article 6 § 2 of the Convention, which provides: “Everyone charged with a criminal offence shall be presumed innocent until proved guilty according to law.” Neither the Government nor the Commission shared this view. A. Applicability of Article 6 37. In the Government’s view, which the Commission shared in substance, Article 6 was not applicable to the case, since no “criminal charge” had been brought against the applicants. They pointed to the fact that in cases such as the present one there was no question of personal guilt on the part of the heirs. For that reason, no entry had been made in the criminal record of any of the heirs. Rather, it was the guilt of the deceased which had to be demonstrated. The fact that proceedings had been brought against the heirs was explained by the fact that in Swiss law the estate as such had no legal personality, so that the deceased’s assets and liabilities fell directly to the heirs. Moreover, the heirs themselves were liable for the evaded taxes and fines only up to an amount not exceeding their share in the estate, and they could escape liability altogether by declining to accept their inheritance. 38. The applicants contended that the main feature of the case was that the tax evasion committed by the deceased was the basis of a fine imposed on them. If the deceased had been alive when the evasion was discovered, the fine would have been imposed on him as a penal measure. The fact that no entry was made in the criminal records of the heirs was irrelevant, since in some cases (for example, for petty offences) no such entry was made even concerning those responsible. The possibility of renouncing the inheritance could not be taken into consideration either, since the period during which this was possible had expired long before the tax evasion by the deceased was discovered. Escaping the fine in this way had accordingly never been an option open to the applicants. 39. The Court reiterates that the concept of “criminal charge” within the meaning of Article 6 is an autonomous one. In earlier case-law the Court has established that there are three criteria to be taken into account when it is being decided whether a person was “charged with a criminal offence” for the purposes of Article 6. These are the classification of the offence under national law, the nature of the offence and the nature and degree of severity of the penalty that the person concerned risked incurring (see, among other authorities, the Öztürk v. Germany judgment of 21 February 1984, Series A no. 73, p. 18, § 50). 40. As regards the nature and severity of the penalty risked, the fines were, in the Court’s opinion, not inconsiderable: they amounted to CHF 3,875.85 for the fiscal year 1981/82 and CHF 2,882.90 for 1983/84 (see paragraph 14 above). Moreover, in setting these figures, the authorities took the applicants’ cooperative attitude into account; the fines might in fact have been four times as large (see paragraph 14 above). 41. As regards the nature of the offence, it is noted that tax legislation lays down certain requirements, to which it attaches penalties in the event of non-compliance. The penalties, which in the present case take the form of fines, are not intended as pecuniary compensation for damage but are essentially punitive and deterrent in nature (see, mutatis mutandis, the Bendenoun v. France judgment of 24 February 1994, Series A no. 284, p. 20, § 47). 42. As regards the classification of the proceedings under national law, the Court attaches weight to the finding of the highest court in the land, the Federal Court, in its judgment in the present case, that the fine in question was “penal” in character and depended on the “guilt” of the offending taxpayer (see paragraph 19 above). 43. Having regard to the above features, the Court considers that Article 6 is applicable under its criminal head. Accordingly, the question arises whether Article 6 § 2 was complied with. B. Compliance with Article 6 § 2 44. The applicants contended that they had been compelled by a legal presumption to assume criminal liability for tax evasion allegedly committed by the deceased Mr P. If, as in the present case, the applicants did their utmost to enable the authorities to make a correct assessment of back tax, the fine would be reduced but would nevertheless be imposed. Thus, although they were themselves blameless, they could not avoid being fined for Mr P.’s offence. Moreover, the imposition of the fine on them presupposed a tacit conviction of the deceased without any form of judicial review. 45. The Government, with whom the Commission concurred in substance, considered that the guilt of the deceased had been lawfully established by the judgment of the Zurich Federal Tax Appeals Board of 19 September 1990 (see paragraphs 15 and 16 above). There was no question of punishing the applicants for criminal acts committed by the deceased. Rather, the liability of the person who had evaded taxes was imposed on his estate. This was clear from the fact that the applicants would not have been liable to pay the fine if they had renounced the inheritance, and that in any event they were not liable for more than their share in the estate. 46. The Court observes that no issue could be, nor was, taken with the recovery from the applicants of unpaid taxes. Indeed, the Court finds it normal that tax debts, like other debts incurred by the deceased, should be paid out of the estate. Imposing criminal sanctions on the living in respect of acts apparently committed by a deceased person is, however, a different matter. Such a situation calls for careful scrutiny by the Court. 47. In this case the Court does not find it necessary to decide whether the guilt of the deceased was lawfully established. Pursuant to Article 130 § 1 of the Ordinance on Direct Federal Tax the proceedings were brought against the applicants themselves and the fine was imposed on them (see paragraphs 11 and 21 above). It must therefore be accepted that, whether or not the late Mr P. was actually guilty, the applicants were subjected to a penal sanction for tax evasion allegedly committed by him. 48. It is a fundamental rule of criminal law that criminal liability does not survive the person who has committed the criminal act. This is in fact recognised by the general criminal law of Switzerland, particularly by Article 48 § 3 of the Swiss Criminal Code, under which a fine lapses if the convicted person dies (see paragraph 31 above). In the Court’s opinion, such a rule is also required by the presumption of innocence enshrined in Article 6 § 2 of the Convention. Inheritance of the guilt of the dead is not compatible with the standards of criminal justice in a society governed by the rule of law. There has accordingly been a violation of Article 6 § 2. II. ALLEGED VIOLATIONS OF ARTICLE 6 §§ 1 AND 3 OF THE CONVENTION 49. The applicants further alleged that they had not had an oral hearing before an independent and impartial tribunal, and that they had not had the opportunity to exercise the rights of the defence, contrary to Article 6 §§ 1 and 3, the relevant parts of which provide: “1. In the determination of ... any criminal charge against him, everyone is entitled to a fair and public hearing ... by [a] ... tribunal ... ... 3. Everyone charged with a criminal offence has the following minimum rights: ... (c) to defend himself in person or through legal assistance of his own choosing ... ...” 50. In view of its conclusion that the imposition of a criminal sanction on the applicants amounted to a breach of Article 6 § 2, the Court does not consider it necessary to address these issues. III. APPLICATION OF ARTICLE 50 OF THE CONVENTION 51. Article 50 of the Convention provides: “If the Court finds that a decision or a measure taken by a legal authority or any other authority of a High Contracting Party is completely or partially in conflict with the obligations arising from the ... Convention, and if the internal law of the said Party allows only partial reparation to be made for the consequences of this decision or measure, the decision of the Court shall, if necessary, afford just satisfaction to the injured party.” The applicants made no claims in respect of damage or of costs and expenses incurred in the domestic proceedings. A. Costs and expenses 52. In respect of costs and expenses incurred in the proceedings before the Strasbourg institutions, the applicants claimed 7,000 Swiss francs (CHF). 53. The Government considered CHF 3,000 in respect of the Strasbourg proceedings to be reasonable. The Delegate of the Commission did not comment. 54. The Court is satisfied that the costs stated were necessarily incurred, and considers that the sum claimed is reasonable as to quantum. It therefore allows the claim in full. B. Default interest 55. According to the information available to the Court, the statutory rate of interest applicable in Switzerland at the date of adoption of the present judgment is 5% per annum.
The Court held that there had been a violation of Article 6 § 2 (right to a fair trial – presumption of innocence) of the Convention. It observed that no issue could be, nor had been, taken with the recovery from the applicants of unpaid taxes. Indeed, the Court found it normal that tax debts, like other debts incurred by the deceased, should be paid out of the estate. Imposing criminal sanctions on the living in respect of acts apparently committed by a deceased person was, however, a different matter. In the present case, whether or not the deceased was actually guilty, the applicants had been subjected to a penal sanction for tax evasion allegedly committed by him. It is, however, a fundamental rule of criminal law that criminal liability does not survive the person who has committed the criminal act and this was in fact recognised by the general criminal law of Switzerland. In the Court’s opinion, such a rule was also required by the presumption of innocence enshrined in Article 6 § 2 of the Convention. Inheritance of the guilt of the dead is not compatible with the standards of criminal justice in a society governed by the rule of law.