19958/92

 AS TO THE ADMISSIBILITY OF Application No. 19958/92 by A. P., M. P. and T. P. against Switzerland The European Commission of Human Rights sitting in private on 16 October 1995, the following members being present: MM. H. DANELIUS, Acting President S. TRECHSEL C.L. ROZAKIS E. BUSUTTIL A.S. GÖZÜBÜYÜK A. WEITZEL J.-C. SOYER H.G. SCHERMERS Mrs. G.H. THUNE Mr. F. MARTINEZ Mrs. J. LIDDY MM. L. LOUCAIDES J.-C. GEUS M.P. PELLONPÄÄ G.B. REFFI M.A. NOWICKI I. CABRAL BARRETO B. CONFORTI N. BRATZA I. BÉKÉS J. MUCHA E. KONSTANTINOV G. RESS A. PERENIC C. BÎRSAN P. LORENZEN K. HERNDL Mr. H.C. KRÜGER, Secretary to the Commission Having regard to Article 25 of the Convention for the Protection of Human Rights and Fundamental Freedoms; Having regard to the application introduced on 13 March 1992 by A. P., M. P. and T. P. against Switzerland and registered on 11 May 1992 under file No. 19958/92; Having regard to : - the reports provided for in Rule 47 of the Rules of Procedure of the Commission; - the observations submitted by the respondent Government on 7 November 1994, the observations in reply submitted by the applicants on 6 January 1995, and the further observations submitted by the applicants on 29 June 1995; Having deliberated; Decides as follows: THE FACTS The facts of the case, as submitted by the parties, may be summarised as follows. The applicants, Swiss citizens residing at Hombrechtikon in Switzerland, are the heirs of Mr. P., who died on 28 February 1984. The first applicant, a housewife born in 1924, is P.'s widow. The second applicant, a construction engineer born in 1951, and the third applicant, a construction entrepreneur born in 1955, are sons of P. Before the Commission they are represented by Mr. H.-P. Derksen, a lawyer practising in Zürich. Particular circumstances of the case After the applicant's death on 28 February 1984, a tax inventory was drawn up on 8 May 1984. Towards the end of May 1984 the period expired during which the applicants' heirs could have refused the heritage (see below, Relevant domestic law). Following a control of the accounts of a company formerly owned by P. the suspicion arose that between 1977 and 1982 he had drawn company income without declaring it. On 13 December 1985 the Cantonal Tax Office (Kantonales Steueramt) of the Canton of Zürich instituted proceedings against P.'s heirs for the payment of federal taxes. In the ensuing proceedings the applicants were represented by a lawyer. On 3 February 1989 the Finance Directorate of the Canton of Zurich imposed taxes and criminal taxes (Nach- und Strafsteuern) on the applicants for the cantonal taxes in respect of the period 1979 until 1983. However, on 2 November 1989 the Zurich Administrative Court quashed the decision on the ground that the responsibility of heirs in matters of criminal taxes contradicted fundamental principles of criminal law in a State governed by law (rechtsstaatliches Strafrecht). On 16 January 1990 the Tax Office found that P. had committed tax evasion in respect of the tax periods 1981/1982 and 1983/84. The decision stated inter alia:

"By incorrectly declaring his income the person liable for tax has withheld taxes from the State and thus become guilty of tax evasion. According to Sections 130 para. 1 and 129 para. 1, respectively, of the Ordinance on Direct Federal Taxes his heirs must therefore pay a fine of up to the fourfold amount in addition to the tax withdrawn. For the taxation period 1981/82, when more than 5/10 were evaded, the fine amounts to 1,5 times the amount, and for the taxation period 1983/84, when more than 3/10 were evaded, to 1,3 times the amount of the taxes withheld. However it can be observed that the heirs have done everything possible to clarify the incorrect declaration of taxes for which reason the fine is reduced to 1/4."

"Durch die unvollständige Deklaration seines Einkommens hat der Pflichtige dem Staat eine Steuer vorenthalten und sich dadurch der Steuerhinterziehung schuldig gemacht. Seine Erben haben daher gemäss Art. 130 Abs. 1 resp. Art. 129 Abs. 1 des Beschlus- ses über die direkte Bundessteuer ausser der hinterzogenen Steuer eine Busse bis zum vierfachen Betrag zu entrichten. Diese wird im vorliegenden Falle bei der Veranlagungsperiode 1981/82 da mehr als 5/10 hinterzogen wurde, auf den 1,5-fachen Betrag und bei der Veranlagungsperiode 1983/84 da mehr als 3/10 hinterzogen wurde, auf den 1,3-fachen Betrag der hinterzogenen Steuer festgesetzt. Indem aber festgestellt werden kann, dass die Erben alles ihnen Zumutbare zur Bereinigung der unrichtigen Deklaration getan haben, wird die Busse auf 1/4 herabgesetzt." The decision concluded that the heirs had to pay taxes of 19,206 SFr and a fine of 6,758.75 SFr. On 19 September 1990 the Federal Taxes Appeals Board (Bundes- steuer-Rekurskommission) of the Canton of Zurich partly upheld the applicants' appeal and quashed the contested decision in respect of the period 1981/82; in respect of the period 1983/84 the Board reduced the taxes due to 8,870.40 and the fine to 2,882.90 SFr. The applicants lodged an administrative appeal (Verwaltungsge- richtsbeschwerde) with the Federal Court (Bundesgericht) complaining of a breach of the presumption of innocence in that they were fined without any personal guilt. The appeal also stated:

"Thus, the applicants are entitled in the determination of the criminal charge against them to a fair and public hearing by an independent and impartial tribunal established by law. They are furthermore entitled to the special rights of defence under Article 6 para. 3 of the Convention. The applicants, who were charged with a criminal offence, should have been granted these defence rights ex officio, but this has not happened so far."

"So haben die Beschwerdeführer Anspruch darauf, dass ihre Sache in billiger Weise öffentlich von einem unabhängigen und unparteiischen, auf Gesetz beruhenden Gericht, das über die Stichhaltigkeit der gegen sie erhobenen strafrechtlichen Anklage zu entscheiden hat, gehört wird. Ferner stehen ihnen die besonderen Verteidigungsrechte gemäss Art. 6 Ziff. 3 EMRK zu. Diese Verfahrensrechte sind den Beschwerdeführern als einer strafbaren Handlung Angeklagten von Amtes wegen einzuräumen, was bisher nicht geschehen ist." On 5 July 1991 the Federal Court dismissed the appeal, the decision being served on 16 October 1991. In respect of the alleged violation of the presumption of innocence the Court found:

"However, according to the principle of the succession in taxes of the heirs ... the latter shall, under Section 130 para. 1 of the Ordinance on Direct Federal Taxes, be liable up to the amount of their share in the estate, and irrespective of any personal guilt, for the deceased person's evaded taxes and the fines. The statutory provision in question of the Ordinance on Direct Federal Taxes thus expressly envisages that the heirs without being held personally guilty enter into the position of the deceased also in respect of the criminal tax. The applicants therefore cannot deduce anything in respect of the heirs' liability from the presumption of innocence stipulated in Article 6 of the Convention, which only applies to persons charged with a criminal offence ... Nor can the general principles of penal law invoked by the applicants be of avail to them in these circumstances."

"Nach dem Grundsatz der Steuernachfolge der Erben ... haften diese gemäss Art. 130 Abs. 1 BdBST jedoch ohne Rücksicht auf ein eigenes Verschulden bis zur Höhe ihrer Erbteile für die vom Erblasser hinterzogene Steuer und für die Bussen. Die fragliche Gesetzesbestimmung des BdBST sieht somit ausdrücklich vor, dass die Erben auch bezüglich der Strafsteuer in die Stellung des Erblassers eintreten, ohne dass sie ein persönliches Verschulden trifft. Aus der Unschuldsvermutung des Art. 6 EMRK, die nur für den wegen einer strafbaren Handlung Angeklagten gilt ..., können die Beschwerdeführer daher nichts zur Frage der Erbenhaftung ableiten. Die angerufenen allgemeinen Grundsätze des Strafrechts sind den Beschwerdeführern unter diesen Umständen ebenfalls unbehelflich." Relevant domestic law I. According to Section 48 para. 3 of the Swiss Penal Code (Strafgesetzbuch), a fine is extinguished if the convicted person dies (stirbt der Verurteilte, so fällt die Busse weg). II. Section 130 para. 1 of the Ordinance on Direct Federal Taxes (Beschluss über die direkte Bundessteuer) provides inter alia:

"If the evasion is discovered only after the death of the person liable to pay taxes, proceedings are instituted and carried out against his heirs. Irrespective of personal guilt, these will 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."

"Wird die Hinterziehung erst nach dem Tode des Steuerpflichtigen entdeckt, so wird das Verfahren gegenüber seinen Erben angehoben und durchgeführt, und diese haften bis zur Höhe ihrer Erbteile solidarisch für die vom Erblasser hinterzogene Steuer und die von ihm verwirkten Bussen ohne Rücksicht auf ein eigenes Verschulden." III. Section 560 para. 4 of the Swiss Civil Code (Zivilgesetzbuch) provides that, upon inheriting the estate, "the debts of the deceased shall become the personal debts of the heirs" ("die Schulden des Erblassers werden zu persönlichen Schulden der Erben"). According to Section 566 para. 1 of the Swiss Civil Code, "the legal and instituted heirs have the possibility to refuse the inheritance which has fallen to them" ("die gesetzlichen und eingesetzten Erben haben die Befugnis, die Erbschaft, die ihnen zugefallen ist, auszuschlagen"). COMPLAINTS The applicants complain under Article 6 para. 2 of the Convention that they have been convicted of an offence irrespective of any personal guilt. The tax authorities established neither their own guilt nor that of P. Under Article 6 paras. 1 and 3 of the Convention they complain that they could not defend themselves in a public hearing before an independent and impartial court, and that P. did not have this opportunity either. Moreover, Section 130bis of the Ordinance on Direct Federal Taxes deprived them under penalty of certain defence rights. PROCEEDINGS BEFORE THE COMMISSION The application was introduced on 13 March 1992 and registered on 11 May 1992. On 5 September 1994 the Commission decided to communicate the application to the respondent Government, pursuant to Rule 48 para. 2 (b) of the Rules of Procedure. The Government's written observations were submitted on 7 November 1994. The applicants replied on 6 January 1995. They submitted further observations on 29 June 1995. THE LAW The applicants complain under Article 6 para. 2 (Art. 6-2) of the Convention that they have been convicted of an offence irrespective of any personal guilt. The tax authorities established neither their own guilt nor that of P. According to Article 6 para. 2 (Art. 6-2) of the Convention, "everyone charged with a criminal offence shall be presumed innocent until proved guilty according to law". The Government contest that the applicants were charged with a criminal offence. It is submitted that the proceedings at issue established the guilt of the deceased, not of the applicants. Furthermore, according to Section 566 of the Swiss Civil Code, the applicants were not obliged to accept the inheritance. Indeed, the applicants only become liable to the extent that they have inherited, and not in respect of the entire estate. Finally, the names of the heirs assuming the deceased's fine will not be listed in the criminal register. The Government point out that under Swiss law the estate has no legal personality and that the heirs, as it were, represent the deceased in proceedings where only the latter, not the heirs, is the accused. By envisaging the responsibility of the heirs, the law aims at discouraging a person from withdrawing taxes during his lifetime. In the present case, the guilt of the deceased was established. The applicants dispute that tax evasion proceedings lose their criminal character within the meaning of Article 6 (Art. 6) of the Convention when they are instituted against the heirs. Indeed, according to the meanwhile revised law the heirs are exempted from the fine if no blame falls on them. Moreover, not even the guilt of the deceased was established according to the requirements of Article 6 para. 2 (Art. 6-2) of the Convention. In the applicants' view, it is irrelevant that as heirs they could have refused the inheritance; thus, the offence which the deceased committed may only become known after the expiry of the time- limit for refusing the inheritance. Finally, as regards entry into the criminal register, the applicants point out that the tax authorities do not require a special register; thus, the records to be taken into account when assessing a tax offence are always available in the taxpayer's personal file. The applicants further point out that the heirs are not only liable for taxes but also for a punishment imposed on the deceased. On the other hand, the State's right to punish an offence loses its inherent justification after the person's death. It is questioned how a decision can be given as regards the reasons for the offences, or the manner in which they were committed, or on the issue of guilt, if the offender is no longer present. Section 130 of the Ordinance on Direct Federal Taxes is clearly an exception to Section 48 para. 3 of the Penal Code. The applicants dispute that the deceased's guilt and culpability were legally established. It would have been precisely the task of proceedings duly conducted in accordance with Article 6 paras. 1 and 2 (Art. 6-1, 6-2) of the Convention to prove this. Indeed, in these proceedings the heirs either cooperate with the authorities by helping to "convict" the offender, or risk themselves, as a consequence of refusing to cooperate, incurring a more severe penalty. Article 6 para. 2 (Art. 6-2) of the Convention prohibits the conduct of any criminal proceedings against third parties, including heirs, in place of the accused, because this would make it impossible to observe the principle of the presumption of innocence. Having examined these complaints the Commission finds that they raise serious questions of fact and law which are of such complexity that their determination should depend on an examination of the merits. The application cannot, therefore, be regarded as being manifestly ill- founded within the meaning of Article 27 para. 2 (Art. 27-2) of the Convention, and no other ground for declaring it inadmissible has been established. For these reasons, the Commission, unanimously, DECLARES THE APPLICATION ADMISSIBLE, without prejudging the merits of the case. Secretary to the Commission Acting President of the Commission (H.C. KRÜGER) (H. DANELIUS)