SHARABIDZE A OSTATNÍ proti Gruzii

FOURTH SECTION

DECISION

Application no. 28062/20
Nikoloz SHARABIDZE and Others
against Georgia

The European Court of Human Rights (Fourth Section), sitting on 17 February 2026 as a Chamber composed of:

Jolien Schukking, President,
Lado Chanturia,
Faris Vehabović,
Lorraine Schembri Orland,
Ana Maria Guerra Martins,
Sebastian Răduleţu,
András Jakab, judges,
and Simeon Petrovski, Deputy Section Registrar,

Having regard to the above application lodged on 8 July 2020,

Having regard to the observations submitted by the Georgian Government (“the Government”) and the observations in reply submitted by the applicants,

Having deliberated, decides as follows:

INTRODUCTION

1. The application concerns the applicants’ complaint under Article 1 of Protocol No. 1 to the Convention for the Protection of Human Rights and Fundamental Freedoms (“the Convention”) that the domestic courts failed to protect their proprietary rights in a dispute with a private bank.

THE FACTS

2. A list of the applicants is set out in the appendix.

3. The Government were represented by their Agent, Mr B. Dzamashvili of the Ministry of Justice.

The circumstances of the case

4. The first applicant was the sole owner and the General Director of the company Ltd. Inzhmsheni (the second applicant); the third applicant is the first applicant’s wife; and the fourth applicant is their family member.

5. The facts of the case, as submitted by the parties, may be summarised as follows.

1. First credit line service contract and subsequent guarantee and mortgage agreements

6. On 8 May 2007 the first applicant, acting on behalf of the second applicant, signed a credit line service contract with the Bank of Georgia, one of the largest commercial banks in Georgia (“the bank”), under which the latter undertook to provide the second applicant with a credit line in the amount of up to 10,000,000 United States dollars (USD) for a duration of 120 months. The contract regulated the general legal relationship between the parties, setting the terms and conditions for the use of the credit line, the credit limit, the interest rate and the rules on its entry into force, functioning and early termination. The contract also stated that mortgage agreements would guarantee the enforcement of its terms and that in the future other additional measures of enforcement might be taken.

7. Subsequently the parties signed several additional contracts in order to ensure the proper functioning of the credit line. On 20 May and 31 August 2010 the first applicant and the bank signed two guarantee agreements, under which the first applicant undertook, in the event that the second applicant failed, in whole or in part, to meet its contractual obligations, to fully reimburse the bank for the principal amount of the used credit line, along with any interest and penalty fee requested by the bank, within a limit of USD 20,000,000. The agreements also stated that the bank could make that request without first attempting to legally enforce the second applicant’s contractual obligations. The fourth applicant signed a similar guarantee agreement, setting the limit of the guarantee at USD 10,000,000, on 21 December 2010.

8. On 24 and 30 December 2010 the first, the third and the fourth applicants signed mortgage contracts with the bank in order to secure the proper fulfilment of the credit line agreement of 8 May 2007. The terms of the mortgage contracts stipulated that the respective applicants’ various immovable assets (four properties in total) were encumbered by mortgages. The contracts included the estimated value of the mortgaged properties as of the time of their signing. They also stated that, if the parties failed to perform their contractual obligations in full or in part, the encumbered property would be subject to enforcement by sale on the basis of notarial writs of execution. All contracts were approved by a notary on the same date.

2. Additional credit line contracts and purchase agreement

9. On 21 and 30 December 2010 the second applicant and the bank signed two additional credit line service contracts setting the amount of supplementary credit lines at USD 1,155,000 and 1,000,000 Georgian laris (GEL, approximately 400,000 euros (EUR)) respectively.

10. In 2011 the second applicant encountered certain financial difficulties and had fallen behind in payments. On 29 December 2011 the second applicant signed a purchase contract with the bank, under which the ownership of the company’s movable and immovable property was transferred to the bank. The contract included a detailed list of the relevant property, along with their prices as agreed upon by the parties. On the same date additional conditions regarding the purchase agreement were outlined in a separate contract, which stipulated that the second applicant could redeem the property in question from the bank, at the price stipulated in the purchase agreement, within 12 months of its signing. On 31 December 2012 the parties entered into another contract, extending the repurchase date until 30 June 2013. At the same time, in accordance with paragraph 2.2 of the above-mentioned contract, if the second applicant failed to pay the repurchase amount, the bank had the right to unilaterally annul the contract, either in full or in part, without seeking the seller’s agreement and acceptance, in order to enforce it for covering or reducing the credit obligation. Both contracts were approved by a notary on the same date.

3. Notarial writs of execution

11. Following the second applicant’s failure to meet its credit obligations and repay the loan, a notary, acting on the request of the bank, issued five writs of execution on 12 June 2014, under which the mortgaged property of all four applicants was to be sold. The amount of the outstanding debt due to the bank was specified by the notary at GEL 3,159,837.10 (approximately EUR 1,300,000) and the title to the mortgaged property was registered in the bank’s name.

12. In parallel, the bank, acting pursuant to the purchase agreement of 29 December 2011 and its supplementary agreement of 31 December 2012, registered in its name the second applicant’s property listed in that agreement.

4. Civil proceedings

13. On 15 May 2015 the applicants lodged a civil claim against the bank, seeking to invalidate various contracts signed with the bank, including the purchase agreement of 29 December 2011 with its supplementary agreement of 31 December 2012, the guarantee and mortgage agreements, and the notary writs of execution. They argued, relying on Articles 55 and 56 of the Civil Code (see paragraph 19 below), that they had been misled by the bank and that the agreements contravened the principles of public morals and public order. They alleged, among other things, that the purchase agreement was deceptive and that the bank had signed it with the sole purpose of ultimately obtaining the title to the second applicant’s property; that the amount that the second applicant had owed to the bank and the value of the immovable and movable property that had been transferred into the bank’s name had not been properly assessed; and that the interference with their property rights had been grossly disproportionate, as only part of the mortgaged property seized by the bank was, according to an estimate by a private audit firm, worth USD 4,700,000. They further alleged that, together with the immovable assets, the bank had unlawfully seized the second applicant’s movable property, valued at GEL 5,000,000 (approximately EUR 2,000,000), which was neither listed in the purchase agreement nor subject to the mortgage, and that, despite their repeated requests, the bank had refused to return those assets. They also alleged that the bank had led them into financial hardship by refusing to grant an additional loan, preventing, as a result, the second applicant from successfully participating in a certain procurement bid. The applicants claimed damages in the amount of GEL 16,500,000 ((approximately EUR 6,500,000) the imposition of GEL 9,509,155 and GEL 5,000,000 in damages and GEL 2,077,480 for lost profits).

14. On 14 March 2017 the Tbilisi City Court rejected their claim in its entirety. After examining all the evidence submitted by the parties, the court concluded that the first applicant, acting on behalf of the second applicant, had decided to take a loan for business development purposes; that he and the remaining applicants had taken a well-informed decision before signing the relevant guarantee and mortgage contracts; that all relevant agreements had been signed in line with the national legislation; and that there was no basis for declaring them void. As far as the allegedly unlawful nature of the agreements was concerned, the court noted that the applicants had failed to show that any of the contracts had been signed against their will and/or that they contained certain unlawful or unfair terms. As for the mortgaged property of the first, the third and the fourth applicants, the Tbilisi City Court, referring to Articles 286 and 891 of the Civil Code, observed that immovable property could be encumbered by a mortgage in order to secure a debt in such a manner as to grant the secured creditor the right to receive satisfaction of his claim from the property before other creditors; and that a guarantor, under a guarantee agreement, assumed the obligation to stand as a guarantor before the creditor for the fulfilment of a third party’s obligation. The court considered that the relevant mortgage and guarantee agreements had been signed in accordance with national legislation and that the applicants had failed to adduce any evidence to the contrary.

15. The applicants appealed, maintaining, among other arguments, that the value of the property that had been seized by the bank was much higher than that of the second applicant’s debt. They argued that the purchase agreement signed on 29 December 2011, which had valued the property at USD 2,000,000, was fraudulent because the real value of only part of that property – according to an estimate by a private audit firm – was USD 4,700,000. Therefore, the relevant agreement should have been annulled on the basis of Article 55 of the Civil Code. The applicants further argued that the enforcement of their mortgaged property on the basis of notary writs of execution and not judicial decisions had been unlawful.

16. On 20 June 2018 the Tbilisi Court of Appeal rejected their appeal, endorsing the reasons given by the first-instance court. The appeal court stressed that all applicants had voluntarily entered into contractual obligations with the bank and that their decisions about the risks they had taken were informed. The court further held that the provisions of the agreements challenged by the applicants could not be considered to amount to unfair terms of contract (see paragraph 19 below) and that the applicants had failed to adduce evidence in support of the allegation that the contracts had breached public morals. As far as mortgage contracts were concerned, the appeal court noted, with reference to Article 302 § 3(1) of the Civil Code of Georgia, that the parties had agreed in advance that the mortgaged immovable property would be enforced by sale pursuant to writs of execution issued by a notary. Accordingly, given the parties’ prior agreement, the use of notary’s writs of execution was not unlawful, and judicial decisions were not required for the transfer and realisation of the applicants’ mortgaged property. As regards the second applicant’s complaint concerning the unlawfulness of the de facto seizure of its movable property, the appeal court noted, citing Articles 160‑61 of the Civil Code, that the applicants should have lodged a separate claim seeking recovery (restitution) of the property allegedly unlawfully obtained by the bank. The court did not separately address the applicants’ argument that there was a disproportionate difference between the value of the seized property and the actual bank debt of the second applicant.

17. On 25 October 2019 the Supreme Court of Georgia rejected an appeal on points of law lodged by the applicants as inadmissible. The court concluded that the contested contracts constituted an expression of free will on the part of all the applicants and that there was no evidence in support of the applicants’ argument that the impugned agreements had been signed in violation of Articles 54 and/or 55 of the Civil Code of Georgia. Specifically with regard to the purchase agreement, the Supreme Court further noted the following:

“27.2. In the present case, the parties’ submission that the disproportion between the value of the property registered by the bank and the amount of debt accumulated by [the second applicant] should lead to the invalidation of the impugned agreement is groundless and unsubstantiated. At the same time, it should be borne in mind that the agreements signed between the parties, which created the right of purchase-redemption, were extended ... specifically in view of the debtor’s best interests and aimed at its financial rehabilitation. [This fact] excludes the existence of a disguised interest on the part of the bank in acquiring [the debtor’s] property.

...

28. The Supreme Court observes that, since there are no grounds for invalidating the agreements ..., the cassation court will not examine the sums claimed.

29. The Supreme Court does not accept [the applicants’] request concerning the invalidation of the guarantee and mortgage agreements and considers that the impugned agreements were signed in line with the requirements set out in law ... At the same time, it was established that [the second] applicant breached its obligations, [and] accordingly, the means used to secure the creditor’s claim are subject to enforcement.”

18. As regards the seized movable property, the Supreme Court observed that the applicants should have claimed them via a separate procedure for lodging such claim.

RELEVANT LEGAL FRAMEWORK

19. Relevant provisions of the Civil Code of Georgia, as in force at the material time, read as follows:

“Article 54 – Contracts contravening legal order and good morals

A contract that contravenes rules and prohibitions determined by law, or the public order and principles of good morals, shall be considered void.

Article 55 – Invalidity of a contract made in abuse of influence

A contract that has been made by one party’s undue influence over the other party when their relationship is based on exceptional confidence shall be considered void.

Article 56 – Sham and fraudulent contracts

1. A contract concluded merely for the sake of appearance, without the intention that it produce the corresponding legal effects (a sham transaction), shall be null and void.

2. If, by means of a sham transaction, the parties intend to conceal another transaction, the rules governing the concealed transactions shall apply (a fraudulent transaction).

...

Article 160 – Claim for recovery of a possession by a possessor in good faith

A possessor in good faith who has been dispossessed may claim recovery of the disputed asset from the new holder within three years. This rule shall not apply if the new holder has a superior title to the asset. A claim for recovery of a possession may also be directed against a holder with a superior title if the latter acquired the disputed asset under duress or by fraud.

Article 161 – Demand by a possessor in good faith to remove an unlawful disturbance

If a bona fide possessor is not deprived of property but is otherwise obstructed in exercising his or her possession, then he or she may, as if he or she were the owner, demand that the disturbance be terminated. In addition, he or she may claim damages [for harm] sustained due to the disturbance of his or her possession. This rule of compensation for damage shall also apply when it is impossible to demand that the obstruction be ended.

...

Mortgage

Article 286 – Definition

1. An immovable property may be used (encumbered) to secure a claim so as to grant to the secured creditor the right to receive satisfaction from the property before other creditors through the sale or transfer of the ownership of the property to him or her (mortgage).

2. A mortgage may also be used to secure future or contingent claims, provided those claims can be determined at the time of the creation of the mortgage.

3. A claim secured by a mortgage may be substituted by another claim. Such substitution shall require an agreement between the owner and the creditor (mortgagee) and the registration of the agreement in the Public Register.

4. An immovable property, as well as means of transportation by water and air, owned by a natural person may not be used as security for a claim arising from a loan or credit agreement to be granted to the natural person (including to the individual entrepreneur).

5. The restriction under paragraph 4 of this article shall not apply to the security of a claim arising from a loan or credit agreement to be signed or agreed by a commercial bank, a microfinance organisation or a non-bank depository institution, such as a credit union or a loan-holding entity, that is subject to the supervision of the National bank of Georgia under the Organic Law of Georgia on the National bank of Georgia.

6. The restriction under paragraph 4 of this article shall not apply if the agreement signed between the parties specifies that a mortgaged immovable property will be transferred to a natural person (including to an individual entrepreneur) for use as a dwelling or to a legal person (mortgagee) for use as a domicile (legal address). Additionally, if two mortgage rights have been registered in favour of the same natural person (including an individual entrepreneur) or legal person, the restriction under paragraph 4 of this article shall apply to him/her/it when concluding the third and each subsequent mortgage agreement.

7. Parties to a mortgage agreement filed with a registration authority for the registration of the right to mortgage shall be responsible for the content of the mortgage agreement and for the validity and lawfulness of the facts specified therein.

...

Article 302 – Realisation of immovable property encumbered by a mortgage

3 (1). The parties may decide, through a written agreement between the creditor and the owner, that the transfer of immovable property encumbered by a mortgage to the creditor and its realisation will be carried out on the basis of an enforcement order issued by a notary. In such a case, the agreement signed between the parties must be notarised.

...

Guarantee

Article 891 – Definition

1. Under a guarantee agreement, the guarantor assumes the obligation to stand as a guarantor before the creditor for the fulfilment of a third party’s obligation.

2. A guarantee may also be used for future and contingent obligations.”

COMPLAINT

20. The applicants complained, under Article 1 of Protocol No. 1 to the Convention, of the State authorities’ alleged failure to protect their property rights against what they considered to be the unlawful and disproportionate transfer of their property into the ownership of the bank.

THE LAW

Admissibility

1. The parties’ submissions

21. The Government submitted that the applicants’ complaint was inadmissible on two grounds. First, as regards the second applicant’s complaint concerning the seizure of its unincumbered movable assets (worth GEL 5,000,000 (approximately EUR 2,000,000)), the Government submitted, citing the relevant parts of the domestic courts’ judgments, that the applicants had failed to initiate a separate set of civil proceedings for the purpose of recovering those movable assets which had allegedly been unlawfully seized alongside the second applicant’s movable property. In accordance with Articles 160-61 of the Civil Code of Georgia and as duly explained by the Tbilisi Court of Appeal and the Supreme Court, the applicants had had at their disposal an effective domestic remedy, which they had failed to avail themselves of.

22. Secondly, they argued that the applicants’ complaint under Article 1 of Protocol No. 1 was manifestly ill-founded and should be rejected pursuant to Article 35 § 3(a) of the Convention. They noted that the complaint simply concerned the outcome of a private civil dispute arising from a contractual relationship between several private parties. The domestic courts had properly examined all relevant legal and factual circumstances of the case before finding that there had been no legal basis for invalidating the disputed agreements and that there had been no room for the Court, acting as a court of fourth instance, to disagree with the findings of the domestic courts.

23. The applicants submitted that they had consistently raised the issue of the unlawfully seized movable property within the scope of the initiated civil proceedings and since the domestic courts had had jurisdiction to adjudicate on the matter, the applicants could not have been expected to bring a separate claim. As for the second objection by the Government, while maintaining their arguments raised before the national courts, they considered that the courts had failed to act with diligence. In particular, albeit in the context of a private dispute, they had nonetheless been expected to properly examine the applicants’ allegations of, among other things, unlawful and disproportionate seizure of their property and the burden this had had on them, but they had failed to do so.

2. The Court’s assessment

24. The Court will address the Government’s inadmissibility pleas in turn.

(a) Non-exhaustion of domestic remedies with respect to the second applicant’s complaint concerning the unincumbered movable property

25. The relevant general principles regarding the exhaustion of domestic remedies are set out in Communauté genevoise d’action syndicale (CGAS) v. Switzerland ([GC], no. 21881/20, §§ 138-45, 27 November 2023).

26. The Court notes that the civil proceedings initiated by the four applicants in the present case were aimed at invalidating the purchase, loan, guarantee and mortgage agreements and the notary writs of execution, which had been issued owing to the second applicant’s failure to meet its financial obligations vis-à-vis the bank (see paragraph 13 above). The nature of the second applicant’s complaint concerning the unincumbered movable property allegedly seized by the bank was distinct, in so far as it did not concern any movable property covered by the mortgage and/or purchase contracts. In such circumstances, the Court agrees with the Government that the second applicant was expected to bring a separate action under Articles 160 and 161 of the Civil Code, seeking the recovery of the unlawfully seized assets, as explicitly advised by the national courts (see paragraphs 16 and 18 above). The second applicant did not provide any explanation in that regard, other than noting that it had already initiated one set of proceedings and could not have been asked to initiate another.

27. Since such a clear remedy, the effectiveness of which was not contested by the second applicant, was never pursued at the domestic level, it follows that its complaint under Article 1 of Protocol No. 1 regarding the loss of unincumbered movable property must be rejected under Article 35 §§ 1 and 3 of the Convention for non-exhaustion of domestic remedies.

(b) Whether the application is manifestly ill-founded

(i) General principles

28. The Court points out that Article 1 of Protocol No. 1, the essential object of which is to protect the individual against unjustified interference by the State with the peaceful enjoyment of his or her possessions, may also entail positive obligations requiring the State to take certain measures necessary to protect the right of property, particularly where there is a direct link between the measures an applicant may legitimately expect from the authorities and his or her effective enjoyment of his or her possessions (see Sovtransavto Holding v. Ukraine, no. 48553/99, § 96, ECHR 2002-VII, and the cases cited therein; Öneryıldız v. Turkey [GC], no. 48939/99, § 134, ECHR 2004‑XII; Broniowski v. Poland [GC], no. 31443/96, § 143, ECHR 2004-V; Păduraru v. Romania, no. 63252/00, § 88, ECHR 2005‑XII; and Zolotas v. Greece (no. 2), no. 66610/09, § 39, ECHR 2013 (extracts)). Even in horizontal relations there may be public-interest considerations involved which may impose some obligations on the State (see also Kotov v. Russia [GC], no. 54522/00, § 109, 3 April 2012).

29. Furthermore, the positive obligations imply, in particular, that States are obliged to provide judicial procedures that offer the necessary procedural guarantees and therefore enable the domestic courts and tribunals to adjudicate effectively and fairly any cases concerning property matters, including those between private parties (see Anheuser-Busch Inc. v. Portugal [GC], no. 73049/01, § 83, ECHR 2007‑I; Chadzitaskos and Franta v. the Czech Republic, nos. 7398/07, 31244/07, 11993/08 and 3957/09, § 48, 27 September 2012; and Zehentner v. Austria, no. 20082/02, §§ 73 and 75, 16 July 2009). The proceedings at issue must afford the individual a reasonable opportunity of putting his or her case to the relevant authorities for the purpose of effectively challenging the measures interfering with the rights guaranteed by this provision. An interference with the rights provided for by Article 1 of Protocol No. 1 cannot therefore have any legitimacy in the absence of adversarial proceedings that comply with the principle of equality of arms, allowing discussion of aspects that are important for the outcome of the case. In ascertaining whether this condition has been satisfied, the Court takes a comprehensive view (see Jokela v. Finland, no. 28856/95, § 45, ECHR 2002‑IV and the cases cited therein, and Zehentner, cited above, § 73).

30. As summarised by the Court in Rustavi 2 Broadcasting Company Ltd and Others v. Georgia (no. 16812/17, § 310, 18 July 2019, with further references), private-law disputes do not themselves engage the responsibility of the State under Article 1 of Protocol No. 1 to the Convention. In particular, the mere fact that the State, through its judicial system, provided a forum for the determination of such a private-law dispute does not give rise to an interference by the State with property rights under Article 1 of Protocol No. 1. The State may be held responsible for losses caused by such determinations if court decisions are not given in accordance with domestic law or if they are flawed by arbitrariness or manifest unreasonableness contrary to Article 1 of Protocol No. 1. However, it should be borne in mind that the Court’s jurisdiction to verify that domestic law has been correctly interpreted and applied is limited, and it is not its function to take the place of the national courts. Rather, the Court’s role is to ensure that the decisions of those courts are not arbitrary or otherwise manifestly unreasonable.

(ii) Application of those principles to the present case

31. Turning to the circumstances of the present case, the Court observes that the applicants’ complaint does not appear to refer to any lack of preventive legal framework and they did not indicate any specific failures in the laws in place at the relevant time. In such circumstances, the Court does not consider it necessary to assess the relevant legislative framework referred to by the Government and will only determine whether the manner in which the law was applied and the way in which it affected the applicants gave rise to a breach of their rights under Article 1 of Protocol No. 1. Its task in the present case, with reference to the general principles described above (see paragraphs 29-30), is, accordingly, to assess whether the domestic courts provided the applicants with an adequate and sufficient forum to duly raise their grievances under Article 1 of Protocol No. 1 and whether their decisions were arbitrary or otherwise manifestly unreasonable to the extent that the responsibility of the State is engaged.

32. The Court notes that the applicants were able to bring civil proceedings against the bank in the course of which they put forward their arguments and contested those of the opposing party. The proceedings were conducted in an adversarial manner at three levels of jurisdiction. The applicants did not allege any breaches of a procedural nature and there is no indication that they were in any way prevented from submitting their evidence and/or developing legal arguments.

33. The salient issue in the proceedings before the domestic courts was whether there were any elements of fraud, undue influence and/or unfairness in the series of agreements signed between the applicants on the one hand and the bank on the other. The Court considers that it has no basis on which to disagree with the domestic courts’ finding that the initial credit line agreement, along with the supplementary credit line agreements and subsequent guarantee, mortgage and purchase contracts, were not unlawful. The courts at all three levels of jurisdiction concluded that the applicants had failed to provide any evidence in support of their allegation that the contracts in question contained unlawful, immoral and/or otherwise unfair terms within the meaning of domestic law (see, in particular, Articles 54-56 of the Civil Code cited in paragraph 19 above). Noting that the applicants had made an informed and voluntary decision when entering into contractual obligations with the bank, the courts emphasised that the extent of the State’s interference with freedom of contract and contractual relations in the banking sector was limited. The Court finds no indication that the domestic courts arbitrarily failed to consider the arguments put forward by the applicants.

34. Turning to the applicants’ next grievance to the effect that the domestic courts failed to reassess the value of the property taken over by the bank in relation to the actual debt owed by the second applicant, the Court observes the following: as noted by the domestic courts, the first applicant, acting on behalf of the second applicant, duly signed the purchase agreement with the bank and the annex thereto in an informed and voluntary manner (see paragraph 10 above). The applicants agreed on the listing and value of the second applicant’s property that was to be transferred to the bank’s name and it does not appear from the material in the case file that the first applicant proposed alternative estimations which were later refused by the bank. The Court also observes that the purchase agreement explicitly stated that the second applicant had the priority right to redeem its property at the same price within a one-year period. This period was further extended for another year (ibid.). In these circumstances, the value of the property as set out in the purchase agreement was not disadvantageous to the second applicant, with the latter enjoying a priority right to redeem the property concerned. It failed to avail itself of this possibility, notwithstanding the extension.

35. The Court notes in this connection that in the present case the first applicant, the sole owner and the General Director of the second applicant, was engaged in a commercial venture which, by its very nature, involved an element of a risk (see, mutatis mutandis, Gasus Dosier- und Fördertechnik GmbH v. the Netherlands, § 70, 23 February 1995, Series A no. 306-B). By borrowing considerable sums and mortgaging assets to secure the loan, the debtor (the second applicant) and its owner (the first applicant) voluntarily exposed themselves to the risk of losing those assets in the event of default (see, mutatis mutandis, Vrzić v. Croatia, no. 43777/13, §§ 68-70 and 103‑109, 12 July 2016, and Antonopoulou v. Greece (dec.), no. 46505/19, § 77, 19 January 2021). While the Court has previously held that the States have a positive obligation to protect citizens and to require that banks take certain measures to safeguard their rights (see, for example, Zolotas, cited above, § 53), the present case is different inasmuch as it does not concern an ordinary consumer vis-à-vis the bank (see Nina Dimitrova v. Bulgaria, no. 40669/16, § 142, 16 April 2024), but a commercial entity, acting through its sole owner, who engaged in a business venture and, as established by the domestic courts, was informed of the risks involved, yet it chose to sign the respective contracts.

36. As to the mortgage agreements, when using their property as collateral, the applicants agreed on the approximate value of the relevant assets at the material time (see paragraph 8 above). They did not argue that the estimations at the time had been unlawfully imposed by the bank. As regards the part of their complaint relating to the enforcement sale of the mortgaged property on the basis of notary writs of execution in the absence of judicial decisions, the Court observes that in accordance with the relevant legislation, mortgage agreements could incorporate various claim‑satisfaction mechanisms, including the possibility of obtaining a writ of execution from a notary (see Article 302 § 1 of the Civil Code, cited in paragraph 19 above). In all cases, selecting the relevant mechanism required the agreement of both parties. In the present case, the first, the third and the fourth applicants, when signing the relevant mortgage agreements, agreed to the simplest and quickest claim-satisfaction mechanism – the notarial enforcement and sale of the encumbered property on the basis of a notary writ (see paragraph 8 above). They knowingly chose not to pursue other available claim-satisfaction mechanisms, including recourse to judicial enforcement. In such circumstances the Court finds no arbitrariness in the domestic courts’ conclusion that the enforcement against the applicants’ property on the basis of notarial writs was lawful.

37. In sum, the Court considers that domestic law offered the applicants adequate remedies to assert their rights related to the protection of their property: they had the possibility of challenging the allegedly abusive, fraudulent and/or unfair nature of the contracts before civil courts, which they did; they also had the opportunity to challenge the enforcement writs issued by the notary, which they also duly exercised. The Court considers that the proceedings, viewed as a whole, afforded them a reasonable opportunity of putting their case to the competent authorities with a view to establishing a fair balance between the conflicting interests at stake. The mere fact that the outcome of the above-mentioned remedy was not favourable to them does not mean that the State did not comply with its positive obligations under Article 1 of Protocol No.1 to the Convention, as it is an obligation of means, not of result (see Madžarović and Others v. Montenegro, nos. 54839/17 and 71093/17, § 110, 5 May 2020).

38. In the light of the considerations above, the Court, noting its finding regarding the absence of any “manifest error of assessment” in the domestic courts’ decisions and reiterating that it is not its role to interpret and apply domestic law, finds that the judicial determination of the applicants’ private dispute with a bank does not amount to an interference with their property rights (see Anheuser-Busch Inc., cited above, § 87). The Court, accordingly, concludes that the State has discharged its positive obligation under Article 1 of Protocol No. 1 to the Convention by providing a proper forum and allowing the applicants to effectively assert their rights (see Antonopoulou, cited above, § 84).

39. The Court therefore considers that the positive obligation of the State under Article 1 of Protocol No. 1 has been complied with in the present case, and in the absence of any arbitrariness or manifest unreasonableness, it cannot call into question the findings of the domestic courts.

40. It follows that this application is manifestly ill-founded and should be dismissed pursuant to Article 35 §§ (a) and 4 of the Convention.

For these reasons, the Court, unanimously,

Declares the application inadmissible.

Done in English and notified in writing on 12 March 2026.

{signature_p_1} {signature_p_2}

Simeon Petrovski Jolien Schukking
Deputy Registrar President

Appendix

List of applicants: