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BUGAJNY AND OTHERS v. POLAND - 22531/05 [2007] ECHR 891 (6 November 2007)
URL: http://www.bailii.org/eu/cases/ECHR/2007/891.html
Cite as:
[2007] ECHR 891
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FOURTH
SECTION
CASE OF BUGAJNY AND OTHERS v. POLAND
(Application
no. 22531/05)
JUDGMENT
STRASBOURG
6
November 2007
This judgment will
become final in the circumstances set out in Article 44 § 2
of the Convention. It may be subject to editorial revision.
In the case of Bugajny and Others v. Poland,
The
European Court of Human Rights (Fourth Section), sitting as a Chamber
composed of:
Mr J. Casadevall, President,
Mr G.
Bonello,
Mr K. Traja,
Mr S. Pavlovschi,
Mr L.
Garlicki,
Ms L. Mijović,
Mr J. Šikuta,
judges,
and Mrs F. Aracı, Deputy Section Registrar,
Having
deliberated in private on 9 October 2007,
Delivers
the following judgment, which was adopted on that date:
PROCEDURE
The
case originated in an application (no. 22531/05) against the
Republic of Poland lodged with the Court on 31 May 2005 under Article
34 of the Convention for the Protection of Human Rights and
Fundamental Freedoms (“the Convention”) by three Polish
nationals, Mr Paweł Bugajny, Mr Tadeusz Ratajczak and
Mr Jarosław Słuja (“the applicants”). The
applicants were represented before the Court by Mr A. Zielonacki, a
lawyer practising in Poznań.
The
Polish Government (“the Government”) were represented by
their Agent, Mr J. Wołąsiewicz of the Ministry of Foreign
Affairs.
The
applicants alleged that their right to the peaceful enjoyment of
their possessions had been breached.
On
24 November 2005 the Court decided to give notice of the application
to the Government. Under the provisions of Article 29 § 3 of the
Convention, it decided to examine the merits of the application at
the same time as its admissibility.
THE FACTS
I. THE CIRCUMSTANCES OF THE CASE
The
first applicant was born in 1963. The second and third applicants
were born in 1964. They live in Poznań.
A. Proceedings before the administrative authorities
The
company “Trust” Ltd. in which the applicants own all of
the shares owned an estate of 6 hectares situated in Poznań. In
1995 the company requested the local administration to give a
decision on the division of the estate, a decision necessary to
proceed with construction on the land.
Eventually,
on 15 November 1999 the Municipal Office gave a decision by which the
division of the estate was approved. Certain plots of land were
designated for construction purposes and others for open space and
garages. A number of plots were designated for construction of
“internal estate roads”. This decision became final on 30
November 1999.
Subsequently,
the applicant company, relying on the provisions of the Land
Administration Act 1997, requested the Mayor of Poznań to
determine the compensation due for the plots designated for road
construction. It submitted that under the relevant provisions of that
Act plots designated, by virtue of decisions on the division of
properties into smaller plots, were expropriated ex lege on
the date on which such decisions became final.
By
a decision of 15 March 2000 the President of the Poznań City
dismissed the application to have the compensation determined,
holding that the roads to be built on the estate concerned had not
been provided for in the local land development plan. Hence, in the
November 1999 decision they had been designated as “internal
roads” which would serve the inhabitants of a housing estate
the construction of which the company had been planning. Not having
been provided for in the local land development plan, these roads did
not belong to the category of public roads. Under the provisions of
the Land Administration Act 1997, as amended in January 2000, only
plots designated for the construction of “public roads”
were to be expropriated ex lege, and only in respect of such
expropriated plots could compensation be sought. In the applicants'
case, the plots in question were designated for internal roads; they
had therefore not been expropriated and, consequently, no
compensation could be determined.
The
applicants appealed. They argued that the roads to be constructed on
the housing estate were to be public, for all practical purposes.
They were to be open to all roads users, including all means of
public and private transport. The term “internal roads”
used in the contested decision did not exist in the Land
Administration Act 1997 as applicable in November 1999. This Act had
been amended after this decision had been given and it was only in
its amended text that it was clearly stated that compensation was due
only for “public” roads (see paragraphs 30 31
below).
The
fact that the plots concerned were referred to in the decision of
November 1999 as designated for the construction of “internal”
roads was an unlawful attempt to deprive them of a public character
and to exempt them thereby from the operation of that Act insofar as
it provided for ex lege expropriation of plots designated for
road construction. Most importantly, it was an attempt to evade the
obligation to pay compensation for such plots.
The
applicants further argued that the fact that these roads had not been
provided for in the local land development plan was immaterial, given
that the decision of 15 November 1999 had obviously been given
in such a way as to be consistent with the local land development
plan. Otherwise, the division of the estate could not have been
approved.
They
lastly argued that the decision complained of breached the
constitutional guarantees of ownership.
On
31 May 2000 the Wielkopolski Governor upheld the decision. The
Governor's decision referred to section 98 of the 1997 Act as
applicable when the November 1999 decision had been given. It
provided that plots designated for road construction under a decision
on the division of property for the construction purposes were
expropriated ex lege on the date on which such a decision
became final. However, the essential purpose of the decisions on the
division of property was to serve the implementation of local land
development plans. In the absence of the inclusion in such a plan of
roads on the land subject to the division decision given in the
applicants' case in November 1999, the plots designated for road
construction could not be regarded as designated for the construction
of “public roads”. Hence, there were no grounds on which
to expropriate them and to grant compensation to the owners.
The
applicants appealed, essentially reiterating their arguments
submitted in their appeal against the first-instance decision.
On
16 October 2001 the Supreme Administrative Court dismissed the
appeal. It referred to section 93 (1) and (3) of the Land
Administration Act 1997. It noted that under these provisions a
decision on the division of property into smaller plots could be
given only if the division proposal was compatible with the local
land development plan and if the newly created plots had access to a
public road.
In
the present case the local development plan did not provide for any
public roads on the land owned by the company. Hence, the fact that
certain parts of the land as divided under the November 1999 decision
had been designated for construction of roads could not entail their
automatic expropriation under section 98 of the same Act. These roads
remained in the ownership of the company and there were therefore no
grounds on which to determine compensation.
In
so far as the applicants relied on decisions of the Supreme
Administrative Court in which it had expressed the view that under
section 98 of the 1997 Act all land designated for roads in the
division decisions was subject to expropriation ex lege, the
court noted that judgments given in other cases were not binding on
it.
It
further noted that the February 2000 amendment to section 98 of the
Land Administration Act 1997 (see paragraph 31 below) which provided
that land designated for the construction of public roads only was
subject to expropriation:
“did not so much limit the scope of roads to which
that provision was applicable, but was only intended to make more
precise the intentions of the lawmaker regarding [the application ]
of this Act”.
It
concluded that that the contested decision was in conformity with the
law.
2. The civil proceedings
Later
on, the applicants' lodged a claim in a civil court seeking a
declaration under Article 189 of the Civil Code as to who was the
owner of the plot of land concerned, listed in the land register as
plot No. 6/25 and covering a surface area of 5,843 square
metres.
By
a judgment of 25 June 2003 the Poznań Regional Court established
that the owner of the plots was Poznań City.
The
court considered, inter alia, that the plan for the division
of the land as adopted in the November 1999 decision was concordant
with the local land development plan. It further observed that such
compliance was an essential condition for the decision on division to
be given in the first place. The court further noted that the local
zoning plan was of a very general character and contained practically
no details as to the planning of roads, apart from major
thoroughfares, and that it did not determine which roads were to be
regarded as public. In these circumstances, the court was of the
view, having regard to the public use of the roads on the property
concerned, that they had been expropriated by the city.
Poznań
City appealed.
By
a judgment of 9 December 2003 the Poznań Court of Appeal
dismissed the claim for a declaration. It considered that the company
had no legal interest in seeking clarification of the legal situation
of the plots concerned by way of a declaratory judgment under Article
189 of the Code of Civil Procedure. The legal situation of the land
had already been determined by the judgment of the Supreme
Administrative Court which was binding on the civil court. Pursuant
to this decision, the claimant remained the owners of the plots in
question.
The
court further observed:
“Obviously, there was also another legal problem
in the case. The conduct of the city in the present case had caused a
situation in which the owner could not use his land freely, as
provided for in Article 140 of the Civil Code. At the same time, the
property serves one of the purposes [road construction] which
normally should be ensured by the local municipality; what is more,
it is the owner who bears the costs of achieving of this purpose.
It can be argued that a situation worse even than a
so-called de facto expropriation obtains in the present case.
This is so because under Article 1 of Protocol No. 1 to the
Convention the term “expropriation” covers not only
formal expropriation or restriction of ownership carried out in
proper expropriation proceedings. The case law of the Strasbourg
Court also distinguishes a category of de facto expropriation,
namely such acts by the public authorities which lead to a practical
deprivation of possessions or to restrictions on their use
(Papamichalopoulos and Others v. Greece, 1993).”
The
applicants lodged a cassation appeal with the Supreme Court. By a
decision of 5 November 2004, served on the applicants on 1 December
2004, it refused to examine it.
II. RELEVANT DOMESTIC LAW AND PRACTICE
1. Relevant constitutional provisions and case-law
Article 21 of the Constitution provides:
“1. The Republic of Poland shall protect property
and a right to inherit.
2. Expropriation is allowed only in the public interest
and against payment of just compensation.”
Article
31of the Constitution reads:
“Freedom of the person shall be legally protected.
Everyone shall respect the freedoms and rights of
others. No one shall be compelled to do anything which is not
required by law.
Any limitation upon the exercise of constitutional
freedoms and rights may by imposed only by statute, and only when
necessary in a democratic state for the protection of its security or
public order, or to protect the natural environment, health or public
morals, or the freedoms and rights of other persons. Such limitations
shall not violate the essence of freedoms and rights.”
Article
79 § 1 of the Constitution provides as follows:
“In accordance with principles specified by
statute, everyone whose constitutional freedoms or rights have been
infringed, shall have the right to appeal to the Constitutional Court
for a judgment on the conformity with the Constitution of a statute
or another normative act on the basis of which a court or an
administrative authority has issued a final decision on his freedoms
or rights or on his obligations specified in the Constitution.”
Under
its settled case-law, the Constitutional Court has jurisdiction only
to examine the compatibility of legal provisions with the
Constitution and is not competent to examine the way in which courts
interpreted applicable legal provisions in individual cases (e.g. SK
4/99, 19 October 1999; Ts 9/98, 6 April 1998; Ts 56/99, 21 June
1999).
On
8 May 1990 the Constitutional Court gave a judgment (K 1/90),
following a request of the President of the Supreme Administrative
Court to examine the compatibility of certain provisions of the 1985
Land Expropriation and Administration Act with the constitutional
protection of the right to the peaceful enjoyment of possessions. The
court noted that the impugned provisions of the 1985 Act provided, in
respect of properties of an agricultural character, for a reduction
of compensation to be paid to owners who had requested that they be
divided, by way of an administrative decision, into smaller plots and
to have certain plots of land expropriated for road construction
purposes. This reduction was based on the premise that the land to be
expropriated ceased to be used for agricultural purposes and that the
negative results of such a change had to be offset by the owners.
The
Constitutional Court observed that the nature of expropriations
carried out in this context did not differ from expropriations
effected for the purposes of public use, regardless of the fact that
an expropriation was effected in proceedings different from ordinary
expropriation proceedings. Hence, the provisions of the Constitution
as they stood at that time and insofar as they provided for the
protection of the right to the peaceful enjoyment of possessions were
applicable to such expropriations. The Constitution allowed for the
expropriation of private properties only for the purposes of public
use and only against compensation. Compensation, in order to comply
with constitutional requirements, had to be just and fair. The notion
of fair compensation, including for expropriation carried out at the
request of the owner and in his or her interest, had to be in the
amount corresponding to the value of the expropriated property. Only
compensation satisfying these conditions was in compliance with the
nature and purpose of the obligation of the public authorities to
compensate an owner whose property was expropriated. Any restrictions
on the right to a fair compensation, including by way of reductions
of its amount, was in breach of constitutional principles.
2. Relevant provisions of the land expropriation legislation
On
1 January 1998 the Land Administration Act of 21 August 1997
(Ustawa o gospodarce nieruchomościami – “the
1997 Land Administration Act”) entered into force. Pursuant to
section 112 of that Act, expropriation consists in taking away, by
way of an administrative decision, of ownership or of other rights in
rem. Expropriation can be carried out where public interest aims
cannot be achieved without restriction of these rights and where it
is impossible to acquire these rights by way of a civil law contract.
Under
section 113 an expropriation can only be carried out for the benefit
of the State Treasury or of the local municipality.
In
accordance with section 128 § 1 of the Act, expropriation can be
carried out against payment of compensation corresponding to the
value of the property right concerned. Under section 130 § 1 of
the Act, the amount of compensation shall be fixed, regard being had
to the status and value of the property on the day on which the
expropriation decision was given. The value of property shall be
estimated on the basis of an opinion prepared by a certified expert.
Section
131 provides that a replacement property can be awarded to the
expropriated owner, if he or she so agrees.
Pursuant
to section 132, compensation shall be paid within fourteen days from
the date on which the expropriation decision becomes subject to
enforcement.
3. Changes in the relevant provisions of the Land Administration
Act 1997
The
question of expropriation of land for the purposes of road
construction is regulated in that Act. Section 93 § 1 of
the Act provides that the division of an estate into smaller plots is
possible only when the division proposed by the owner is compatible
with the local land development plan. Under § 3 of this section,
a decision on the division can not be given if the plots resulting
from the division would have no access to a public road. Access to a
public road is also deemed to be available if a plot has access to an
internal road.
Until
15 February 2000 section 98 of the Act read as follows:
1. Plots of land designated for the construction of
roads in an administrative decision on the division of property shall
be expropriated ex lege on the date on which such a division
decision becomes final. (...)
3. The compensation due for such plots shall be
established by way of negotiation between the expropriated owner and
the relevant public authority; if negotiations fail, compensation
shall be determined according to the principles applicable in respect
of land expropriation.
39. On 15 February 2000
amendments to this Act came in force. Following these amendments, the
text of subsection (1) read as follows:
“1. Plots of land designated in a decision on the
division of property for the construction of public roads, such as
municipal, county, regional and national roads shall be expropriated
ex lege on the date on which such a division decision becomes
final. (...) “
40. In a legal opinion
of 29 May 2003, prepared for a different case from that of the
applicants', the Central Urban Development Office stated that section
78 of the Land Administration Act in its version applicable until
15 February 2000 was a legal basis for the expropriation ex
lege of all land
designated for road construction purposes under decisions on the
division of properties, regardless of whether these roads were of a
public character or were to be considered internal roads, on the date
when such decisions became final.
THE LAW
I. ALLEGED VIOLATION OF ARTICLE 1 OF PROTOCOL NO. 1
TO THE CONVENTION
The applicants alleged that their right to the peaceful enjoyment of
their possessions had been breached. They referred to Article 1
of Protocol No. 1 to the Convention, which reads:
“Every natural or legal person is entitled to the
peaceful enjoyment of his possessions. No one shall be deprived of
his possessions except in the public interest and subject to the
conditions provided for by law and by the general principles of
international law.
The preceding provisions shall not, however, in any way
impair the right of a State to enforce such laws as it deems
necessary to control the use of property in accordance with the
general interest or to secure the payment of taxes or other
contributions or penalties.”
A. Admissibility
The
Government submitted that the applicants had failed to exhaust
the relevant domestic remedies because they had not availed
themselves of an individual constitutional complaint under Article 79
§ 1 of the Constitution. The Court had recognised that,
even if the Constitutional Court was not competent to quash
individual decisions because its role was to rule on the
constitutionality of laws, its judgments declaring a statutory or
other provision unconstitutional gave rise to a right to have the
impugned proceedings re-opened in an individual case. Consequently,
the Government argued that, if the applicants had considered that
certain provisions relied on in their case had violated their right
to the peaceful enjoyment of their possessions, they should have
asked the Constitutional Court to decide, by way of a judgment,
whether those provisions were compatible with the Constitution.
The
applicants submitted that the constitutional complaint was not a
relevant remedy in their case. The applicable domestic law, namely
section 98 of the Land Administration Act 1997, as it had stood
before the amendment of 15 February 2000, was favourable to the
applicants as it provided for expropriation ex lege and for
compensation. They had not had any legal interest in challenging it
and it was also plain that this provision was compatible with the
Constitution.
The
Court reiterates that it has held that
a constitutional complaint is an effective remedy for the purposes of
Article 35 § 1 of the Convention only in situations where the
alleged violation of the Convention resulted from the direct
application of a legal provision considered by the complainant to be
unconstitutional (see
Szott-Medyńska
v. Poland (dec.),
no. 47414/99, 9 October 2003;
Pachla v. Poland (dec.),
no 8812/02, 8 November 2005; Wypych
v. Poland (dec.),
no. 2428/05,
25 October 2005).
In
this connection, the Court observes that the breach of the Convention
complained of in the present case cannot be said to have originated
from the direct application of a legal provision which the applicants
deemed to be unconstitutional. Rather, it resulted from the way in
which various provisions of the Land Administration Act 1997, in
particular its section 98 read in conjunction with section 93, were
interpreted and applied in the applicants' case. However,
it follows from the case law of the Polish Constitutional Court
that it lacks jurisdiction to examine the way in which the provisions
of domestic law were applied in an individual case (see paragraph
30 above). The Government did not refer to any other domestic
remedy which could have been used in this case.
The
Court further notes that the civil court, in its judgment of
9 December 2003, stated that the applicants had no legal
interest in obtaining a judgment clarifying their legal situation in
respect of their entitlement to compensation because the matter had
already been determined by the judgment of the administrative court
(see paragraph 24 above). In the light of this conclusion of the
domestic court, the Court is of the view that it has not been shown
that the applicants had any other avenue open to them, judicial or
otherwise, by which to try to vindicate their claim for expropriation
and compensation.
Accordingly, the Court concludes, in the light of the
above considerations, that the application cannot be rejected for
failure to exhaust domestic remedies. The Court thus dismisses the
Government's plea to that effect. It further notes that the
application is not inadmissible on any other grounds. It must
therefore be declared admissible.
B. Merits
1. The Government's submissions
The
Government averred that the assessment of the case had hinged on
whether the roads concerned were public or not. They noted that the
administrative authorities had found that, under systemic rules of
interpretation, section 98 of the Land Administration Act 1997 as
applicable at the material time concerned public roads only. There
were no grounds on which to accept that this provision concerned all
roads, regardless of whether they were public or not.
This
approach was later specified in the amendment of February 2000 to
that Act. In addition, the Supreme Administrative Court had also
held, in its judgment of 16 October 2001 (see paragraph 17 above)
that the roads on the applicants' land were not public because they
had not been provided for in the local land development plan. Had
that been the case, they would have been expropriated and
compensation would have been paid.
The
applicants' case could not be likened to the case of
Papamichalopoulos v. Greece as in that case the
applicants had lost all ability to make use of their property, to
sell, bequeath, mortgage or make a gift of it. In the present case
the applicants could use and dispose of the land concerned and no
public authority had ever deprived them of possession of it.
The
Government concluded that there had been no interference with the
applicants' possessions as they remained the lawful owners of the
land and could still use it. The mere fact that the land served
public purposes in that it had been used for the construction of
roads accessible to the general public and that the applicants had
had to finance the construction of these roads themselves was
insufficient for finding that their possessions had been interfered
with.
In
the absence of any interference, the Government stated that they
would abstain from making any submissions as to the public interest,
lawfulness and proportionality of the interference alleged by the
applicants.
2. The applicants' submissions
The
applicants submitted that they owned the entire estate, including the
plot designated in the November 1999 decision for road construction
purposes. However, this plot had to be used for such construction at
the applicants' expense. Normally, under the applicable laws, the
costs of the construction of local roads were to be borne by the
local municipalities. By designating the plots concerned in the
present case for the construction of roads, while considering that
they were not to be regarded as “public”, the
municipality had evaded its obligation to bear these costs. Moreover,
it had de facto imposed such an obligation on the applicants.
The
roads subsequently built on the estate served, for all practical
purposes, as public roads and ensured access to the estate for the
general public. Under the applicable legal provisions, a
decision on the division of the property could not have been issued,
had the division plan proposed by the applicants not complied with
the requirements and restrictions originating in the local land
development plan. Therefore, the roads on the estate constituted part
of the normal road network in Poznań. The artificial description
of the roads as “internal” served the purpose of evading
the obligation on the part of the municipality to expropriate the
land concerned and to pay compensation to the applicants.
The
applicants submitted that the administrative authorities, when
applying the provisions of the Land Administration Act 1997 as
applicable in November 1999 to their case, had resorted to a systemic
and teleological interpretation, but had entirely disregarded the
plain meaning of section 98 of that Act according to which land
designated for all roads was to be expropriated.
The
applicants emphasised that they had been refused compensation by the
municipality and that the administrative court had countenanced this
decision. As a result of the manner in which the relevant
provisions of the Land Administration Act 1997 had been applied in
their case, the applicants had been de facto deprived of their
property in a manner contrary to Article 1 of Protocol No. 1. They
referred to the judgment in the Papamichalopoulos v. Greece
case in which the Court had found that the measures complained of had
entailed sufficiently serious consequences for the applicants de
facto to have been expropriated in a manner incompatible with
their right to the peaceful enjoyment of their possessions.
Theoretically
the applicants could use the land concerned as its lawful owners, but
only as roads. Therefore the possibility of their using the land was
strictly limited. Nor could they, for obvious reasons, sell the roads
to third parties.
3. The Court's assessment
The
Court first reiterates that Article 1 of Protocol No. 1,
which guarantees the right to the protection of one's possessions,
contains three distinct rules: “The first rule, set out in the
first sentence of the first paragraph, is of a general nature and
enunciates the principle of the peaceful enjoyment of property; the
second rule, contained in the second sentence of the first paragraph,
covers deprivation of possessions and subjects it to certain
conditions; the third rule, stated in the second paragraph,
recognises that the Contracting States are entitled, amongst other
things, to control the use of property in accordance with the general
interest [...]”. The three rules are not, however, 'distinct'
in the sense of being unconnected. The second and third rules are
concerned with particular instances of interference with the right to
peaceful enjoyment of property and should therefore be construed in
the light of the general principle enunciated in the first rule (see,
among many other authorities, Anheuser-Busch Inc. v. Portugal
[GC], no. 73049/01, § 62, ECHR 2007 ...).
(a) Whether there was interference with the peaceful
enjoyment of “possessions”
The
Court must first examine whether there was interference with the
peaceful enjoyment of the applicants' possessions.
In
order to assess the conformity of the State's conduct with the
requirements of Article 1 of Protocol No. 1, the Court must have
regard to the fact that the Convention is intended to guarantee
rights that are practical and effective. It must go beneath
appearances and look into the reality of the situation, which
requires an overall examination of the various interests in issue;
this may call for an analysis not only of the compensation terms –
if the situation is akin to the taking of property (see, for example,
Lithgow and Others v the United Kingdom, judgment of 8
July 1986, Series A no. 102, pp. 50-51, §§ 120 121)
– but also, as in the instant case, of the conduct of the State
(Beyeler v. Italy [GC], no. 33202/96, § 114,
ECHR 2000 I, and Novoseltskiy v. Ukraine,
no. 47148/98, ECHR 2005 II).
In
the present case the applicants were obliged, by the authorities'
refusal to expropriate the land and pay them compensation – a
course of events which they might reasonably have expected in the
light of the provisions on the expropriation of land designated for
the construction of roads - to build the roads, to bear the costs of
their construction and maintenance, and also, importantly, to accept
the public use of their property. The measures complained of
significantly reduced in practice the effective exercise of their
ownership (mutatis mutandis, Sporrong and Lönnroth
v. Sweden, judgment of 23 September 1982, Series A
no. 52, §§ 58 60; Skibińscy
v. Poland, no. 52589/99, § 79, 14 November
2006).
The
Court therefore concludes that there was indeed an interference with
the peaceful enjoyment of the applicants' possessions.
The
Court further observes that the findings of the domestic courts did
not in any way adversely affect the applicants' position as the legal
owners of the land. There is therefore no room for the application of
the second sentence of the first paragraph in the present case (see,
mutatis mutandis, Terazzi v. Italy, no. 27265/95,
§ 61, 17 October 2002).
Likewise, the measures complained of cannot be regarded as a control
of use of property. Accordingly, the interference falls to be
examined under the first sentence of Article 1 of Protocol No. 1
(James and Others v. the United Kingdom, judgment of
21 February 1986, Series A no. 98, pp. 29 30,
§ 37; see also, among many other authorities, Belvedere
Alberghiera S.r.l. v. Italy, no. 31524/96, § 51,
ECHR 2000 VI).
(b) Whether the interference was “in the general
interest”
Any
interference with a right of property can only be justified if it
serves a legitimate public (or general) interest. The Court
reiterates that, because of their direct knowledge of their society
and its needs, the national authorities are in principle better
placed than the international judge to decide what is “in the
public interest”. Under the system of protection established by
the Convention, it is thus for the national authorities to make the
initial assessment as to the existence of a problem of public concern
warranting measures interfering with the peaceful enjoyment of
possessions (see Terazzi S.r.l. v. Italy, cited above,
§ 85, 17 October 2002; Elia S.r.l. v. Italy,
no. 37710/97, § 77, ECHR 2001 IX).
63. In
the present case the Court considers that the measures complained of
pursued the legitimate aim of protecting the financial stability of
the municipal budget. This corresponds to the general interest of the
community (see, mutatis
mutandis, Cooperativa
La Laurentina v. Italy,
no. 23529/94, § 94,
2 August 2001; Bahia
Nova S.A. v. Spain,
(dec.), no. 50924/99, 12 December 2000; Chapman
v. the United Kingdom,
no. 27238/95, § 82, ECHR 2001 I).
(c) Whether the interference was “provided for by
law”
The
Court reiterates in this connection that an essential condition for
an interference to be deemed compatible with Article 1 of Protocol
No. 1 is that it should be lawful. The rule of law, one of the
fundamental principles of a democratic society, is inherent in all
the Articles of the Convention (see Iatridis v. Greece
[GC], no. 31107/96, § 58, ECHR 1999 II). However,
the principle of lawfulness also presupposes that the applicable
provisions of domestic law be sufficiently accessible, precise and
foreseeable in their application (see, among other authorities,
Hentrich v. France, judgment of 22 September 1994,
Series A no. 296 A, pp. 19 20, § 42;
Lithgow and Others v. the United Kingdom, judgment of
8 July 1986, Series A no. 102, p. 47, § 110).
In
this connection the Court reiterates that it is in the first place
for the domestic authorities, notably the courts, to interpret and
apply domestic law (Jahn and Others v. Germany [GC]
nos. 46720/99, 72203/01 and 72552/01, § 86, ECHR 2005
). It observes that the interference with the applicants'
property rights was based on the provisions of the Land
Administration Act 1997. It further notes that the Supreme
Administrative Court, in its judgment of 2001, found that the refusal
to expropriate the plots in question was in compliance with the
applicable laws.
In
the light of the Court's limited jurisdiction to review the
correctness of the judicial application of the domestic law, the
Court concludes that the interference complained of
satisfied the requirement of lawfulness within the meaning of Article
1 of Protocol No. 1.
(d) Proportionality of the interference
The
Court must next examine whether the interference with the applicants'
right to peaceful enjoyment of their possessions struck the requisite
fair balance between the demands of the general interest of the
public and the requirements of the protection of the individual's
fundamental rights, or whether it imposed a disproportionate and
excessive burden on them (see, among many other authorities, Jahn
and Others v. Germany [GC], nos. 46720/99, 72203/01 and
72552/01, § 93, ECHR 2005 VI).
The
Court reiterates that, in the area of land
development and town planning, the Contracting States should
enjoy a wide margin of appreciation in order to implement their
policies (see
Terazzi S.r.l. and Elia S.r.l., cited above; Skibińscy
v. Poland cited above, § 59). Nevertheless, in the
exercise of its power of review, the Court must determine whether the
requisite balance was maintained in a manner consonant with the
applicant's right of property (see, mutatis mutandis, Sporrong
and Lönnroth v. Sweden, cited above, § 69).
The
Court observes that the Supreme Administrative Court found, in its
judgment of 16 October 2001, that the Land Administration Act,
insofar as it provided for ex lege expropriation on the date
on which the division of the property became final, was not
applicable to the applicants' case. Therefore, the authorities
refused to formally expropriate the plots belonging to the applicants
and refused to determine the amount of compensation.
In
this context, the Court notes that, following the division of the
land owned by the applicants into smaller plots, the plots of land
concerned in the present case were subsequently used for road
construction purposes at the expense of the applicants. The
applicants built also a housing estate on the remaining plots (see
§ 7 above). The Court observes that under the applicable
provisions of the Land Administration Act, the division of the estate
into smaller plots was possible because the division proposed by the
owners was compatible with the local land development plan (see § 36
above). It further notes the applicants' argument that the roads
built on the estate are connected to the network of public roads.
They currently serve both the general public and the housing estate
which the applicants developed and are open both to public and
private transport of all kinds (see § 52 above). Given that
the entire area of the housing estate covers nine hectares which were
divided into as many as thirty-six plots of land designated for the
construction purposes, it is reasonable to accept that a considerable
number of people can be said to use these roads. It has not been
shown or even argued that the access to the estate or the use of
these roads is restricted or limited in any way. The situation
examined in the present case must therefore be distinguished from
that of “fenced” housing estates to which the public
access is restricted by a decision of its inhabitants.
The
only way in which the land in question can now be used is as
roads. The applicants are also currently obliged to bear
the costs of their maintenance. The Court emphasises that
the burden which the applicants were made to bear is not limited in
time in any way.
The
Court observes that one of the arguments on which the authorities
relied when refusing to expropriate the applicants' property was that
the roads to be constructed on the estate had not been included in
the local land development plan. However, it reiterates that it was
not in dispute that the decision on the division could be issued only
when the division plan submitted by the owners was compatible with
the land development plan. The Court considers that by adopting such
an approach the authorities could effectively evade the obligation to
build and maintain roads other than major thoroughfares provided for
in the plans and shift this obligation onto individual owners.
The
Court finally notes that the Poznań Regional Court expressed
serious doubts as to whether the applicants' situation was compatible
with the requirements of Article 1 of Protocol No. 1. This court
expressly compared the applicants' position to that of the applicant
in the Papamichalopoulos v. Greece case cited above and
considered it to be “even worse”. In the Court's view,
the applicants' situation in the present case was less serious than
the situation examined in the Papamichalopoulos judgment,
because they were not divested of all possibility of using their
property. Nonetheless, such a critical assessment on the part of the
domestic court is certainly, in the Court's view, of relevance for
the overall assessment of the case.
Having
regard to the above considerations, the Court is of the view that a
fair balance was not struck between the competing general and
individual interests and that the applicants had to bear an excessive
individual burden.
There
has accordingly been a violation of Article 1 of Protocol No. 1
to the Convention.”
III. APPLICATION OF ARTICLE 41 OF THE CONVENTION
Article 41 of the Convention provides:
“If the Court finds that there has been a
violation of the Convention or the Protocols thereto, and if the
internal law of the High Contracting Party concerned allows only
partial reparation to be made, the Court shall, if necessary, afford
just satisfaction to the injured party.”
The
applicants claimed 1,019,988.50 Polish zlotys (PLN) in compensation
for pecuniary damage and as reimbursement of costs and expenses. This
amount was broken down as follows:
(i) PLN 946,566
in respect of the surface area of 5,843 square metres, covered by the
plot of land currently being used as roads, the average price of 1
square metre of the estate being estimated on the basis of a report
prepared by a certified expert submitted to the Court and dated
February 2003, at PLN 152,07. The expert referred to the
characteristics of the land in the area concerned and to the
conditions obtaining on the local real estate market in 2003. He
noted that there was a period of stagnation on the market, linked to
the general conditions in the national economy. However, the area
offered attractive conditions and many transactions had been
concluded, thus bringing the prices slightly above the average in the
city.
(ii)
PLN 73,422.50 in respect of the costs and expenses incurred in the
proceedings before the civil courts during which the applicants had
sought to prevent the violation of their right to the peaceful
enjoyment of their possessions.
In
respect of pecuniary damage, the Government reiterated that there had
been no interference with the applicants' right to the peaceful
enjoyment of their possessions. Hence, there were no grounds on which
to find that they had suffered pecuniary damage. They further
observed that the applicants should have submitted to the Court
documents showing that the income of their company resulting from the
payment of the compensation would have been divided and paid to the
shareholders. They further argued that the applicants should have
tried to offset the negative financial consequences of the refusal to
pay them compensation. In this connection, they could have obliged
persons who had bought the houses developed on the estate to acquire
shares in ownership of the land currently being used as roads.
They
concluded that the applicants' claim should therefore be dismissed.
The
Government did not make any submissions regarding the claim for costs
and expenses.
The
Court first observes that it has found that there has been an
interference with the applicants' right to the peaceful enjoyment of
their possessions (see paragraph 58 above). It further observes that
the damage, in the present case, actually stems from the authorities'
refusal to expropriate the land and to pay compensation determined in
accordance with the domestic law.
The
Court notes that the principles for determining the amount of
compensation for expropriated land are laid down in the Land
Administration Act 1997. Under sections 128 § 1 and 130 of that
Act the compensation should correspond to the value of the land as
assessed by a certified expert. In the present case, the applicants
made detailed submissions as to the value of the land in question.
The estimate makes reference to the average price of land in this
area in 2003, when their civil claim, by which they tried to obtain
redress for the financial setback they had suffered as a result of
the refusal to expropriate their land, was dismissed. The Court
further notes that this estimate has been prepared by a certified
expert, who had taken into account the situation of the local market
at that time and the particular characteristics of the area
concerned.
The
Court further notes that the Government have challenged neither the
method used by the expert nor the overall amount.
The
Court is therefore of the view that it has been shown that the amount
claimed by the applicants is reasonably related to the value of the
land concerned and to the amount of compensation which would have
been paid to the applicants had their land been expropriated by the
administrative authorities under the provisions of the Land
Administration Act.
It
notes that the Government have not indicated any legal basis on which
the applicants could have obliged the present owners of the houses
situated on the estate to buy the land currently used as roads.
In the circumstances of the case and having regard to
the parties' submissions, the Court awards the applicants jointly
EUR 247,000 under the head of pecuniary damage, plus any tax
that may be chargeable on this amount.
In
respects of the costs, according to the Court's case-law, an
applicant is entitled to reimbursement of his costs and expenses only
in so far as it has been shown that these have been actually and
necessarily incurred and are reasonable as to quantum. In the present
case, regard being had to the information and documents in its
possession and the above criteria, the Court considers it reasonable
to award the amount of EUR 18,725 covering the costs incurred in
the civil proceedings before the Polish courts, plus any tax that may
be chargeable on that amount, to be converted into the national
currency of the respondent State at the rate applicable at the date
of settlement.
C. Default interest
The
Court considers it appropriate that the default interest should be
based on the marginal lending rate of the European Central Bank, to
which should be added three percentage points.
FOR THESE REASONS, THE COURT UNANIMOUSLY
Declares the application admissible;
Holds that there has been a violation of Article
1 of Protocol No. 1 to the Convention;
3. Holds
(a) that
the respondent State is to pay the applicants jointly, within three
months from the date on which the judgment becomes final in
accordance with Article 44 § 2 of the Convention,
the following amounts, to be converted into the national currency of
the respondent State at the rate applicable at the date of
settlement, plus any tax that may be chargeable:
(a)
EUR 247,000 (two hundred and forty-seven thousand euros) in respect
of pecuniary damage;
EUR
18,725 (eighteen thousand seven hundred and twenty five euros)
in respect of costs and expenses;
(b) that
from the expiry of the above mentioned three months until
settlement simple interest shall be payable on the above amounts at a
rate equal to the marginal lending rate of the European Central Bank
during the default period plus three percentage points.
Dismisses the remainder of the applicants' claim
for just satisfaction.
Done in English, and notified in writing on 6 November 2007, pursuant
to Rule 77 §§ 2 and 3 of the Rules of Court.
Fatoş Aracı Josep Casadevall
Deputy
Registrar President
