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ALTHOFF AND OTHERS v. GERMANY - 5631/05 [2011] ECHR 2057 (8 December 2011)
URL: http://www.bailii.org/eu/cases/ECHR/2011/2057.html
Cite as:
63 EHRR 4,
[2011] ECHR 2057,
(2016) 63 EHRR 4
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FIFTH
SECTION
CASE OF
ALTHOFF AND OTHERS v. GERMANY
(Application
no. 5631/05)
Judgment
(merits)
STRASBOURG
8 December
2011
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 Althoff and Others v. Germany,
The
European Court of Human Rights (Fifth Section), sitting as a Chamber
composed of:
Dean
Spielmann,
President,
Karel
Jungwiert,
Boštjan
M. Zupančič,
Mark
Villiger,
Ann
Power-Forde,
André
Potocki,
judges,
Klaus
Köpp, ad
hoc judge,
and
Claudia Westerdiek,
Section Registrar,
Having
deliberated in private on 15 November 2011,
Delivers
the following judgment, which was adopted on the last mentioned
date:
PROCEDURE
The
case originated in an application (no. 5631/05) against the Federal
Republic of Germany lodged on 11 February 2005 with the Court under
Article 34 of the Convention for the Protection of Human Rights and
Fundamental Freedoms (“the Convention”) by nine German
nationals, Mrs Edith Althoff and eight others (see full list in
annex) (“the applicants”).
The
applicants were represented by Professor O. Depenheuer of Cologne
University and Mr A. Birkmann, a lawyer practising in Erfurt. The
German Government (“the Government”) were represented by
their Agent, Mrs A. Wittling-Vogel, Ministerialdirigentin,
of the Federal Ministry of Justice, and also by Professor J.A.
Frowein, Director (emeritus) of the Max Planck Institute of
Heidelberg.
The
applicants alleged in particular that the new version of
section 30a(1) of the Property Act and its application by the
domestic courts had breached their right to the peaceful enjoyment of
their possessions under Article 1 of Protocol No. 1.
They further relied on Article 14 of the Convention.
Renate
Jaeger, the judge elected in respect of Germany who was in office at
the time of the application, decided to withdraw from the case (Rule
28 of the Rules of Court). The Government accordingly appointed
Mr Klaus Köpp, a lawyer practising in Bonn, to sit as ad
hoc judge (Article 27 § 2 of the Convention and Rule 29
§ 1 as in force at the time).
By
a decision of 13 October 2009, the Chamber declared the application
admissible.
The
applicants and the Government each filed further written observations
(Rule 59 § 1).
THE FACTS
I. THE CIRCUMSTANCES OF THE CASE
The
facts of the case, as set out by the parties, can be summarised as
follows.
The
present dispute is between Germany, which succeeded to the rights of
the heirs of the original Jewish owners of the disputed property (the
initial injured party – “Erstgeschädigte”)
under the German-US Agreement of 13 May 1992, and the applicants, who
are the heirs of a shopkeeper who had acquired the disputed property
in 1939 (the initial sale having taken place in 1938). The property
was subsequently expropriated at the time of the former German
Democratic Republic (GDR). The applicants are thus the heirs of the
subsequent injured party – “Zweitgeschädigte”.
A. Background to the case prior to German reunification
1. National-Socialist period
The
disputed plots of land, having respective surface areas of 1000 sq.m,
990 sq.m and 1030 sq.m, are located at Babelsberg-Potsdam, near
Berlin, on the territory of the former GDR.
By
a notarially-registered contract of 23 April 1938, Mr A. and Mrs B.,
who were Jewish and partners in the limited partnership
“Mitteldeutsche Gamaschenfabrik E.B. und A.”, the owner
of the disputed plots of land, sold them for 66,000 reichsmarks (RM)
to the Berlin company A. Wülfing. Having been the victims
of persecution under the National Socialist regime, Mr A. died
in 1940 and Mrs B. in 1945. Mrs E.F., daughter of Mrs B.,
emigrated to the United States of America in 1939 and became a US
citizen in 1951.
By
a notarially-registered contract of 28 July 1939, the disputed plots
of land were then sold for RM 61,000 to Mr G. Althoff, a shopkeeper,
who was registered as the owner at the land registry, and the
applicants are his heirs.
2. Under the German Democratic Republic
On
27 January 1953, in the former GDR, the land was expropriated and
became “people’s property” (Volkseigentum)
under the control of a State-owned film company.
3. Mrs E.F.’s action to obtain compensation in
the USA
Mrs E.F. subsequently brought proceedings in the USA
for the loss of the disputed property, in accordance with the US law
of 18 October 1976 on claims against the GDR, which entitled US
citizens whose property in the former GDR had been expropriated
before that date or which had been sold under duress in the
National-Socialist period to file claims for compensation.
In
a final decision of 27 August 1980, the US Foreign Claims Settlement
Commission acknowledged that Mrs E.F. was entitled to 5,500 US
dollars (USD) in compensation, plus interest at 6% from September
1951.
B. Developments after German reunification (effective
on 3 October 1990)
After
German reunification the property was transferred to the company “dok
Filmstudio GmbH”, whose sole shareholder was the Office for
special reunification-related questions (Bundesanstalt für
vereinigungsbedingte Sonderaufgaben).
In
a decision of 17 October 1997, that Office observed that the disputed
property had been sold for 1,300,000 deutschmarks (DM) for investment
purposes to the company Weiland GbR, in accordance with the
Investment Priority Act (Investitionsvorrangsgesetz) of 14
July 1992 (see relevant domestic law and practice, paragraph 32
below).
1. Proceedings before domestic authorities and
courts concerning restitution of the disputed property
On
10 October 1990 the applicants filed a claim for the restitution of
the property with the Office for the Resolution of Outstanding
Property Issues for the Land of Brandebourg – (Landesamt
für die Regelung offener Vermögensfragen –
“Office of the Land”), in accordance with the
relevant provisions of the Law on the resolution of outstanding
property issues – “the Property Act” (Gesetz zur
Regelung offener Vermögensfragen – Vermögensgesetz)
of 23 September 1990 (see relevant domestic law and practice,
paragraph 31 below).
On 13 May 1992 the Federal Republic of Germany (FRG)
and the United States of America signed the German-US Agreement on
the settlement of certain property claims – “the
German-US Agreement” (Abkommen zwischen den Regierungen der
Bundesrepublik Deutschland und der Vereinigten Staaten von Amerika
über die Regelung bestimmter Vermögensansprüche),
which provided for a global settlement of compensation claims by US
citizens resulting from the US law of 18 October 1976 on claims
against the GDR. By a law of 21 December 1992 the German-US Agreement
became an integral part of domestic law; it entered into force on 28
December 1992 (see relevant domestic law and practice, paragraph 34
below). On 29 April 1997, the FRG paid a total sum of over 102
million US dollars in compensation.
On
20 October 1998 the Property Rights Clarification Act
(Vermögensrechtsbereinigungsgesetz) retrospectively
amended section 30a(1) of the Property Act, providing that the
time-limit for the filing of restitution claims, initially set at 31
December 1992, did not apply to the rights of the FRG under the
German-US Agreement (see relevant domestic law and practice,
paragraph 33 below).
In
a letter of 27 April 1999 the FRG indicated to the Office of the Land
that in accordance with Article 3 § 9, second sentence, of the
German US Agreement, it had taken over Mrs E.F.’s title to
the disputed property.
(a) Decision of the Office for the
Resolution of Outstanding Property Issues for the Land of Brandenburg
In
a decision of 12 July 2001 the Office of the Land dismissed
the applicants’ restitution claim and indicated that the
proceeds from the sale of the disputed property in 1997 was indeed to
be paid to the FRG. It first noted that the initial sale of the
disputed plots of land in 1938 had been obtained under duress, within
the meaning of section 1(6) of the Property Act. Consequently, the
rights pertaining to the property fell within the scope of the
German-US Agreement. In accordance with sections 2(1) and 6(6a) of
the Property Act, read together with Article 3 § 9, second
sentence, of the German-US Agreement, the FRG had become the legal
successor to Mrs E.F. She had opted for the payment of
compensation and had thus renounced her claims against the FRG.
The
applicants brought proceedings before the Potsdam Administrative
Court, on the ground that they had a lawful entitlement to
restitution, having regard to the fact that Mrs E.F. had not lodged
any application to that effect before the time-limit of 31 December
1992, as provided for by section 30a(1), first sentence, of the
Property Act, notwithstanding the subsequent amendment of that
provision by the Property Rights Clarification Act of 20 October
1998.
(b) Judgment of the Potsdam Administrative
Court
In a judgment of 28 November 2002, the Potsdam
Administrative Court upheld the Office’s decision on all
points. In the court’s view, even if the FRG’s right to
restitution had lapsed, because no application had been lodged to
that effect before the time-limit of 31 December 1992 fixed by
section 30a(1), first sentence, of the Property Act, its right had
subsequently been revived following the amendment of that section in
1998. Moreover, the applicants had not acquired an irrevocable
(unabänderlich) right under section 14 (right to
property) of the Basic Law (Grundgesetz), because at the time
of the FRG’s claim in 1999, the Office of the Land had
not yet given its decision.
(c) Judgment of the Federal Administrative
Court
In
a judgment of 21 January 2004 the Federal Administrative Court
dismissed the applicants’ request for judicial review. It first
noted that, under the relevant provisions of the German-US Agreement,
the property rights of Mrs E.F. had been transferred to the FRG.
Given that Mrs E.F had been compensated in 1976, the JCC (Jewish
Claims Conference), which had also filed a restitution claim, could
not claim property rights. The Administrative Court then confirmed
that the FRG had not filed a valid restitution claim before the
time-limit of 31 December 1992 as provided for by section 30a(1),
first sentence, of the Property Act. The law on the Agreement of 21
December 1992 had not provided for any specific provisions in that
connection and the letter of 1 October 1992 from the Federal Office
for the Resolution of Outstanding Property Issues (Bundesamt für
die Regelung offener Vermögensfragen – “the
Federal Office”) to the authorities of the Länder
could not be regarded as a valid claim because it was not
sufficiently specific. Referring to its settled case-law, the
Administrative Court added that the fixing of this time-limit
corresponded to a provision of substantive law, which meant that the
rights of the FRG had lapsed with the expiry of the statutory
time-limit. However, by amending section 30a(1) of the Property Act
in 1998, the legislature had “remedied” the failure to
file a claim within that time-limit. It was only from that date
onwards that the property rights of Mrs E.F. could be considered to
have been effectively transferred to the FRG, and not at the time of
the complete payment of compensation as provided for in Article 3 §
9 of the German-US Agreement (see relevant domestic law and practice,
paragraph 34 below). The aim of that legislative amendment had been
to ensure the survival of the former property rights and to rectify
that omission. In addition, again with reference to its settled
case-law, the Administrative Court took the view that the applicants’
rights to restitution under the Property Act did not benefit from the
protection of Article 14 § 1 of the Basic Law, because those
rights did not correspond to existing property rights but stemmed
from the State’s wish to provide redress for past injustice.
Lastly, in accordance with the settled case-law of the Federal
Constitutional Court, it was in this case a question of
“quasi-retrospective” effect (unechte Rückwirkung);
having regard to the confused and uncertain legal situation existing
at the time, the applicants had not acquired any “confidence
warranting protection” (schutzwürdiges Vertrauen)
or any legal certainty that their position as “subsequent”
injured party afforded them an entitlement to the restitution of the
disputed property. Moreover, the JCC had also filed a restitution
claim within the statutory time-limit, and its rights would have
prevailed over those of the applicants if it had been successful.
(d) Decision of the Federal Constitutional
Court
In
a decision of 14 August 2004 the Federal Constitutional Court,
sitting in a committee of three members, refused to allow a
constitutional complaint by the applicants. It observed in particular
that section 30a(1), fourth sentence, of the Property Act was
compatible with Article 14 § 1 of the Basic Law, even if it were
presumed in the applicants’ favour that their entitlement to
restitution under the Property Act, or to the payment of the proceeds
of the sale under section 16(1), first sentence, of the Investment
Priority Act, enjoyed the protection of Article 14 § 1. In the
Constitutional Court’s view, section 30a (1), fourth sentence,
of the Property Act had to be understood as a provision defining the
content and limits (Inhalts- und Schrankenbestimmung) of the
right to property within the meaning of Article 14 § 1, second
sentence, of the Basic Law, and struck a fair balance between the
interests at stake. Under section 3 (2) of the Property Act, taken
together with section 1(2), first sentence, of the Law of 27
September 1994 on compensation in accordance with the Property Act –
“the Compensation Act” (Gesetz über die
Entschädigung nach dem Gesetz zur Regelung offener
Vermögensfragen – Entschädigungsgesetz –
see domestic law and practice, paragraph 31 in fine, below),
the applicants, being regarded as the “subsequent”
injured party, were, from the outset, simply entitled to
compensation. Under Article 3 § 9, second sentence, of the
German-US Agreement, the FRG had succeeded to the rights of the
“initial” injured parties, who, having regard to the
compensation that they had already received, could no longer claim
any rights based on the Property Act. In filing a claim
concerning property rights based on the German-US Agreement, the FRG
had thus sought to secure a property right equivalent to that of an
“initial” injured party that had already materially been
“claimed” and compensated for. The legislature had thus
wished to clarify the situation for that kind of right.
The Constitutional Court added that even if a
different position were adopted, namely, as the Federal
Administrative Court had found, that the rights under section 1(6) of
the Property Act had lapsed on 31 December 1992 and had then been
revived following the amendment of section 30a(1) of the Property
Act, the new version of that section had struck a fair balance
between the interests at stake. The property rights under the
German-US Agreement had originally been provided for by the US law of
1976 and had already been compensated for in 1980 as regards the
disputed property. At the time of the ratification of the German-US
Agreement it had been presumed that the total amount to be paid in
compensation could reach USD 190 million. The FRG could not have been
expected ultimately to renounce its property rights for which it had
had to pay compensation in such a high amount – even though the
transfer had not become effective until the determination of the
final transfer payment (nach Feststellung des endgültigen
Überweisungsbetrags). For this reason, the German State had
in particular sent the Länder authorities the lists of
the rights covered by the Agreement, in a letter of 2 October 1992
from the Federal Office. In addition, the law of 20 December 1993 on
the acceleration of registration procedures
(“Register-Beschleunigungs-Gesetz”) extended the
possibility for the competent authorities to enter reservations in
the land register (stipulating that the property could be sold only
with the State’s approval) in respect of the rights arising
from the German-US Agreement.
Under
those circumstances, there could not have been any “confidence
warranting protection” as to the maintaining of the statutory
situation as it had first existed according to the initial version of
section 30a(1).
2. Proceedings before the domestic authorities and
courts concerning the payment of compensation
On
12 January 2005 the applicants filed a request for compensation for
the loss of the disputed property with the Office of the Land
of Brandebourg, in accordance with the relevant provisions of the
Compensation Act.
In
a decision of 20 March 2007 the Office of the Land dismissed
the applicants’ request on the ground that they had not filed
it within a period of six months after the final rejection of the
restitution claim, as provided for by section 7a(3c) of the Property
Act.
The
applicants then appealed to the Potsdam Administrative Court, which
stayed the proceedings pending the judgment of the European Court of
Human Rights (“the Court”) in the present case.
II. RELEVANT DOMESTIC LAW AND PRACTICE
A. The Basic Law
Article
14 § 1 of the Basic Law reads as follows:
“Property and the right of inheritance shall be
guaranteed. Their content and limits shall be defined by statute.”
B. Law on the resolution of outstanding property issues
– the Property Act
On 29 September 1990 the Property Act of 23 September
1990, which was also to be part of the Unification Treaty
(Einigungsvertrag), came into force. Under the Treaty the
Property Act would remain in force in Germany after the reunification
of the two German States on 3 October 1990. The Act’s purpose
was, in particular, to settle any conflicts relating to property on
the territory of the GDR in a manner that was socially acceptable, in
order to ensure long-term legal security in Germany.
Section
1(1) of the Property Act provides that it is applicable to rights in
respect of property that was expropriated at the time of the GDR and
section 1(6) provides that it also applicable to persons against
whom proceedings were brought in Germany between 30 January 1933 and
8 May 1945 on racist, political, religious or ideological grounds
(weltanschauliche Gründe) and who had consequently
lost their property “by forced sale, expropriation or other
means”. Sections 2 and 3 of the Act complement section 1.
Section
3(1) of the Property Act provides that any property that became
“people’s property” will be returned on request
unless excluded by the law. Section 3(2) provides that if a number of
parties make a request for restitution concerning the same property,
it is the party that was “first” injured which is thus
entitled. That means that, as in the present case, when property was
sold under duress during the National-Socialist period, then
subsequently expropriated in the former GDR, the heirs of the
original Jewish owners have a priority right to restitution. In such
a case where restitution of the property is excluded (section 4(1) of
the Property Act), the heirs of the purchasers of the property during
the National-Socialist period are entitled to the payment of
compensation provided for by the law of 27 September 1994 on
compensation according to the Property Act.
Section 16 § 1, first sentence, of the Investment
Priority Act provides that if restitution of property is impossible
because the property has been sold, the person entitled may request
payment of a sum equivalent to the value of his property rights.
2. Section 30a(1)
Section
30a(1), first sentence, of the Property Act stipulates that
restitution claims had to be filed no later than 31 December
1992. The Property Rights Clarification Act of 20 October 1998
amended the section in question by introducing a fourth sentence
according to which that time limit does not apply to rights held
by the FRG under the Agreement of 13 May 1992 between the FRG
and US Governments on the settlement of certain property claims.
C. Agreement of 13 May 1992 between the Federal
Republic of Germany and the United States of America on the
settlement of certain property claims – “the German-US
Agreement”
Article
3 § 1 of the German-US Agreement provides that US citizens have
to choose between receiving compensation or bringing proceedings
before the German courts to obtain reparation in accordance with the
US law of 18 October 1976 on claims against the GDR. If they opt
for the first solution, they forfeit any right of action against the
FRG, under Article 3 § 6, second sentence, of the
Agreement. Under Article 3 § 9, second sentence, their property
rights are then transferred to the FRG at the time of the complete
payment of compensation. That statutory succession also applies to
rights arising from any harmful measures taken under the
National-Socialist regime.
By a
law of 21 December 1992 the German-US Agreement became part of
domestic law. It entered into force on 28 December 1992.
D. Judgment of the Federal Administrative Court of 26
May 1999
In
a judgment of 26 May 1999 the Federal Administrative Court indicated
that section 30a(1), fourth sentence, of the Property Act (which, in
its new version, provides that the time-limit initially set for
restitution claims does not apply to rights stemming from the
German-US Agreement) did not apply if the legislative amendment had
taken place after the issuance of a restitution notice by the
competent authority and the transfer of the property to an entitled
party other than the German Government. In that judgment it further
held that, having regard to its wording, meaning and aim, section
30a(1), first sentence, of the Property Act applied at the outset to
all property claims. In order to ensure legal certainty, the
time-limit initially fixed also had to apply to the “derived”
claims (abgeleitete Ansprüche) arising from the German-US
Agreement.
THE LAW
I. ALLEGED VIOLATION OF ARTICLE 1 OF PROTOCOL NO. 1 TO THE
CONVENTION
The
applicants argued that the new version of section 30a(1) of the
Property Act and its application by the domestic courts had infringed
their right to the peaceful enjoyment of their possessions as
guaranteed by Article 1 of Protocol No. 1, which reads as
follows:
“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. Applicability of Article 1 of Protocol No. 1
1. The parties’ submissions
The
applicants argued that they alone were entitled either to restitution
of the disputed property under section 3(1), first sentence, of the
Property Act, or to payment of the proceeds of the sale that took
place after reunification under section 16(1) of the Investment
Priority Act, representing a sum of DM 1,300,000. Neither the German
State nor the JCC had competing rights. As Mrs
E.F. had opted for the payment of compensation in 1976,
she had lost her entitlement as “initial” injured party
(Erstberechtigte) which had then fallen to the applicants. The
property rights of Mrs E.F. had not been transferred to the FRG until
1997, well after the expiry of the time-limit provided for in section
30a(1), first sentence, of the Property Act. No restitution claim had
been filed within that time, so the FRG’s property rights had
lapsed, as the Federal Administrative Court had indicated. As a
result, the applicants, having filed a proper request within the
statutory time-limit, remained the sole entitled party. The amendment
with retrospective effect in 1998 – six years after the expiry
of the statutory time-limit – of section 30a(1) of the Property
Act to the State’s advantage could not therefore be regarded as
a mere legislative clarification. Contrary to the Government’s
assertion, section 30a(1), first sentence, also applied to the rights
of the FRG under the German-US Agreement; thus, in drafting the new
law of 1998, the Bundesrat had clearly indicated that the new
provision was intended to enable the Government to assert their
property rights under the German-US Agreement despite any failure to
file a claim within the statutory time-limit or to extend the
time-limit under section 30a(1), first sentence, of the Property Act.
As the German-US Agreement had been signed on 13 May 1992, the FRG
would easily have had the opportunity to file a restitution claim,
even by way of precaution, within the statutory time-limit.
As their main argument, the Government submitted that
the applicants had never had a “possession” within the
meaning of Article 1 of Protocol No. 1, and in particular, as there
was no settled case-law of the domestic courts to that effect, that
they had no legitimate expectation of obtaining restitution of their
property.
Under
the Property Law, the applicants, as heirs to property expropriated
under the legislation of the former GDR, could have claimed
restitution only if no other claimant had a prior position, which had
been the case in particular for the heirs of the former Jewish
owners. The applicants should have been aware that in such an
eventuality they would only have had a right to compensation. The
expiry of the 31 December 1992 deadline had had no automatic legal
consequence, because it had been for the competent authorities to
determine whether the applicants had a right to restitution or
whether they were excluded on the basis of the applicable
legislation. In a decision of 12 July 2001 the competent authority
had rejected the applicants’ claim to that effect and that
decision had been upheld by all the domestic courts. Moreover, before
the expiry of the time-limit in question, there had been two events
which showed that no legitimate expectation could come into existence
for the applicants: the registration of a claim by the JCC, which
could under certain circumstances provided for by the Property Act
assert the rights of the former Jewish owners, and the enactment of
the law of 21 December 1992 by which the German-US Agreement was
incorporated into domestic legislation. That law provided for the
transfer of the rights of the former Jewish owners to the German
State if they had opted for the payment of compensation, which was
the situation in the present case; the transfer had not become
effective until 29 April 1997 with the determination of the
final transfer payment. Moreover, the judgment of the Federal
Administrative Court of 26 May 1999, before which the German State
had argued that it had a claim to the property despite the fact that
the amendment to the time-limit for restitution claims had occurred
after the decision of the competent authority, showed how unclear the
legal situation had been during that period. Lastly, the introduction
of special legislation in December 1993 with the aim of securing the
State’s rights, by making it possible for the competent
authorities to register a special reservation in the land registry
(according to which the property could be sold only with the State’s
consent), had shown that the State was of the opinion that the
German-US Agreement did not require any registration of a restitution
claim on its part.
2. The Court’s assessment
The
Court must first examine the question of the applicability of
Article 1 of Protocol No. 1. For that purpose it must ascertain
whether the applicants had “possessions” within the
meaning of this provision, which, if there are no “existing
possessions”, as in the present case, extends to assets,
including claims, in respect of which the applicants could argue that
they had at least a “legitimate expectation” of obtaining
effective enjoyment of a property right. Such a legitimate
expectation, which has to be more concrete in nature than a mere
hope, must “be based on a legal provision or have a solid basis
in the domestic case-law” (see, among other authorities,
Von Maltzan and Others v. Germany (dec.) [GC], nos.
71916/01, 71917/01 and 10260/02, §§ 74, 77, 78 and 112,
ECHR 2005-V).
In
the present case, the Court notes that it is not in dispute that the
applicants submitted a restitution claim based on the relevant
provisions of the Property Act within the statutory time-limit, which
expired on 31 December 1992 under section 30a(1) of the Property
Act, in its original version. By contrast, the FRG, which under the
German-US Agreement (which was signed on 13 May 1992 and became
effective on 28 December 1992) had succeeded to the rights of Mrs
E.F., the heir of the original Jewish owners, had not submitted such
a restitution claim within the statutory time-limit.
The
Court therefore takes the view that a distinction is to be drawn
between the situation before and after the expiry of the time-limit.
Before
the expiry of the time-limit, the applicants, as heirs to property
expropriated at the time of the GDR, could have obtained either the
restitution of the property in question (section 3(1), first
sentence, of the Property Act), or payment of the proceeds of the
sale that took place after reunification (section 16(1), first
sentence, of the Investment Priority Act), or compensation (section
3(2) of the Property Act in conjunction with section 1(2), first
sentence, of the Compensation Act) (see relevant domestic law and
practice, paragraphs 31 and 32 above). As the heirs of owners of
property expropriated in the former GDR and thus being the
“subsequent injured party”, they did not have a
legitimate expectation that their property would be returned to them,
given that the heirs of the original Jewish owners, the “initial
injured party”, were also entitled to submit a restitution
claim and their right took priority.
On
the expiry of the statutory time-limit, only the applicants and the
JCC had submitted a restitution claim. However, as the Federal
Administrative Court observed in its judgment of 21 January 2004, the
JCC was not entitled to assert any property rights, because Mrs E.F.
had received compensation in 1976 and her property rights had been
transferred to the FRG under the German-US Agreement (see paragraph
24 above).
Admittedly,
whilst the applicants had lodged their restitution claim on 10
October 1990, the Office of the Land did not issue its
rejection until 12 July 2001, almost eleven years later and after the
legislative amendment of 1998, and that decision was subsequently
upheld by the domestic courts. In its judgment of 26 May 1999 in
another case, the Federal Administrative Court drew a distinction
according to whether the competent authority’s decision on the
restitution claim and the transfer of property as such had occurred
before or after the legislative amendment (see relevant domestic law
and practice, paragraph 35 above).
However,
in the present case, the Federal Administrative Court observed that
the Law of 21 December 1992 on the German-US Agreement had not
contained any specific provisions exempting the FRG from filing such
a claim; referring to its established case-law, it found that the
FRG’s rights had lapsed on the expiry of the statutory
time-limit. And in its judgment of 26 May 1999, the Federal
Administrative Court indicated that section 30a(1) of the Property
Act had initially applied to all property claims, including those
concerning “derived rights” stemming from the German-US
Agreement.
As
regards the nature of the property rights held by the applicants
under the domestic law, whilst the Federal Administrative Court took
the view that their rights to restitution under the Property Act did
not benefit from the protection of Article 14 § 1 of the Basic
Law, in its decision of 14 August 2004 the Federal
Constitutional Court, by contrast, found that it could be assumed
that the applicants’ rights did benefit from the protection of
Article 14 § 1, but that the legislature had struck a fair
balance between the interests at stake.
The
Court accordingly finds that, on the expiry of the statutory
time-limit, in the absence of any restitution claim by the FRG, sole
successor to the heirs of the original Jewish owners, the initial
injured party, the applicants, even though they were the heirs of the
owners of property expropriated in the former GDR and therefore the
subsequent injured party, nevertheless had a “legitimate
expectation” of being able to exercise a right to the
restitution of the property concerned. This “legitimate
expectation” was also based on the judgment of the Federal
Administrative Court indicating that the Law of 21 December 1992 on
the German-US Agreement did not contain any specific provisions
exempting the FRG from filing such a claim, and on the decision of
the Federal Constitutional Court, which took the view that it could
be assumed that the applicants’ rights benefited from the
protection of Article 14 § 1 of the Basic Law.
Having
regard to the very particular circumstances of the present case, the
applicants therefore had a “possession” within the
meaning of the first sentence of Article 1 of
Protocol No. 1. Consequently, the guarantees of that provision are
applicable in the present case.
B. Compliance with Article 1 of Protocol No. 1
1. The parties’ submissions
The
applicants argued that the amendment with retrospective effect of
section 30a(1) of the Property Act to the State’s advantage,
without adequate compensation, clearly constituted a deprivation of
property within the meaning of Article 1 of Protocol No. 1.
In
their view, the deprivation did not pursue a legitimate aim, because
the Government had simply sought to correct its own mistake
retrospectively at the applicants’ expense. Whilst such
mistakes could always occur in the carrying out of the body politic’s
administrative tasks, the resulting burden should be assumed by all
citizens alike and not passed on to individuals retrospectively by
depriving them of their property.
In
addition, that deprivation of property had imposed a disproportionate
burden on the applicants, who had had an entitlement to restitution
under the Property Act and it had been taken from them
retrospectively. It was on that basis that they sought to obtain
compensation through the Court. The amount of compensation
provided for by the Compensation Act was irrelevant in this
connection, because its purpose was to compensate original owners
whose claims could not be satisfied under the Property Act – a
situation that was fundamentally different from their own. It was
thus only on totally alternative and preventive grounds that the
applicants had filed a request for compensation – filed,
according to them, within the statutory time-limit – on 28
December 1992, but this was unrelated to the present application.
Lastly, the applicants argued that the compensation provided for by
the Compensation Act was not proportionate to the impugned
interference.
In the Government’s submission, even assuming that the
applicants had a “possession”, the amendment of section
30a(1) of the Property Act could not be declared contrary to Article
1 of Protocol No. 1 because it struck a fair balance between the
interests at stake, in the light of the wide margin of appreciation
afforded to the State in the context of German reunification.
The purpose of that legislative amendment had been to clarify a
situation which, according to the highest German courts, had remained
unclear. Moreover, the purpose of the Property Law had been to give
priority to the restitution of property to the heirs of the original
Jewish owners and to reserve for them the actual value of the
property. In the present case, however, those rights had been
transferred to the FRG following the German-US Agreement and it was
in the public interest for the State to secure the assets for which
it had paid compensation for a total of 102 million US dollars
to the United States of America. The applicants, for their part,
could have claimed compensation of about DM 55,000 based on the
relevant provisions of the Property Act that were applicable in the
event of restitution proving impossible.
The
Government took the view that it would not be correct to evaluate the
proportionality of the interference on the basis of the value of the
property after 1990, as the applicants had not acquired an absolute
right to the property. Relying on the Court’s decision in
Poznanski (Poznanski v. Germany (dec.), no.
25101/05, 3 July 2007), they took the view that, having regard to the
uncertainty of the applicants’ property rights, a sum of about
DM 55,000 could be regarded as proportionate compensation. The
applicants had failed to file a claim for that purpose within the
statutory time-limit, but the relevant proceedings before the
Administrative Court were still pending.
2. The Court’s assessment
(a) Interference with the peaceful
enjoyment of a “possession”
As
it has stated on several occasions, the Court reiterates that
Article 1 of Protocol No. 1 comprises 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, among 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, inter alia, James
and Others v. the United Kingdom, 21 February 1986, §
37, Series A no. 98, which partly reiterates the terms of the Court’s
reasoning in Sporrong and Lönnroth v. Sweden,
23 September 1982, § 61, Series A no. 52; see also Jahn and
Others v. Germany [GC], nos. 46720/99, 72203/01 and 72552/01, §
78, ECHR 2005-VI).
The
Court notes that in the present case the Property Rights
Clarification Act of 20 October 1998 retrospectively amended
section 30a(1) of the Property Act by introducing a fourth
sentence to the effect that the time-limit of 31 December 1992
stipulated in that provision did not apply to the rights stemming
from the German-US Agreement.
That retrospective amendment led to the loss for the applicants of
any entitlement to the restitution of the properties or to the
payment of the proceeds of sale, representing the actual value of the
properties after reunification.
In
the Court’s view, the measure thus constituted interference
with the applicants’ right to the peaceful enjoyment of their
possessions and has to be examined under the second sentence of the
first paragraph of Article 1 of Protocol No. 1.
The
Court must therefore ascertain whether the interference complained of
was justified under that provision.
(b) Justification for the interference
(i) “Provided for by law”
As
regards the lawfulness of the interference, the Court notes that the
impugned measure was based on the Property Rights Clarification Act
of 20 October 1998, and its accessibility, precision and
foreseeability, as required by the Convention, are not in doubt.
The
German courts subsequently took the view that by amending section
30a(1) of the Property Act of 1998 the legislature had remedied the
failure by the FRG to file a claim within the statutory time-limit,
and the Federal Constitutional Court found that those decisions were
compliant with the Basic Law.
The
Court does not consider this interpretation to have been arbitrary.
It reiterates in this connection that it is in the first place for
the domestic authorities, notably the courts, to interpret and apply
the domestic law (see, among many other authorities, Jahn and
Others, cited above, § 86).
The
deprivation of property was thus provided for by law, as required by
Article 1 of Protocol No. 1.
The
Court must now determine whether this deprivation of property pursued
a legitimate aim, that is, whether it was “in the public
interest”, within the meaning of the second rule under Article
1 of Protocol No. 1.
(ii) “In the public 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 appreciate 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 of deprivation of
property. Here, as in other fields to which the safeguards of the
Convention extend, the national authorities, accordingly, enjoy a
certain margin of appreciation.
Furthermore,
the notion of “public interest” is necessarily extensive.
In particular, the decision to enact laws expropriating property will
commonly involve consideration of political, economic and social
issues. The Court, finding it natural that the margin of appreciation
available to the legislature in implementing social and economic
policies should be a wide one, will respect the legislature’s
judgment as to what is “in the public interest” unless
that judgment is manifestly without reasonable foundation (see James
and Others, cited above, § 46, and Zvolský and
Zvolská v. the Czech Republic, no. 46129/99, § 67 in
fine, ECHR 2002-IX). The same applies necessarily, if not a
fortiori, to such radical changes as those occurring at the time
of German reunification, when the system changed to a market economy
(see Jahn and Others, cited above, § 80).
In
the present case the Court has no reason to doubt that the aim of the
Property Rights Clarification Act of 1998, which – as its title
indicates – was to clarify a legal situation that was uncertain
in the eyes of the German legislature and to secure the State’s
property rights stemming from the German-US Agreement, was in the
public interest.
(iii) Proportionality of the interference
The
Court reiterates that an interference with the peaceful enjoyment of
possessions must strike a “fair balance” between the
demands of the general interest of the community and the requirements
of the protection of the individual’s fundamental rights (see,
among other authorities, Sporrong and Lönnroth, cited
above, § 69; Stran Greek Refineries and Stratis Andreadis v.
Greece, 9 December 1994, § 69, Series A no. 301 B; and
National & Provincial Building Society, Leeds
Permanent Building Society and Yorkshire Building Society v. the
United Kingdom, 23 October 1997, § 80, Reports of
Judgments and Decisions 1997 VII). The concern to achieve
this balance is reflected in the structure of Article 1 of
Protocol No. 1 as a whole, including therefore the second
sentence, which is to be read in the light of the general principle
enunciated in the first sentence. In particular, there must be a
reasonable relationship of proportionality between the means employed
and the aim sought to be realised by any measure depriving a person
of his possessions (see Pressos Compania Naviera S.A. and
Others v. Belgium, 20 November 1995, § 38, Series A no.
332).
In determining whether this requirement is met, the Court recognises
that the State enjoys a wide margin of appreciation with regard both
to choosing the means of enforcement and to ascertaining whether the
consequences of enforcement are justified in the general interest for
the purpose of achieving the object of the law in question (see
Chassagnou and Others v. France [GC], nos. 25088/94, 28331/95
and 28443/95, § 75, ECHR 1999-III). Nevertheless, the Court
cannot abdicate its power of review and must determine whether the
requisite balance was maintained in a manner consonant with the
applicants’ right to the peaceful enjoyment of their
possessions, within the meaning of the first sentence of Article 1 of
Protocol No. 1 (see Zvolský and Zvolská,
cited above, § 69, and Jahn and Others, cited above, §
93).
Compensation
terms under the relevant legislation are material to the assessment
whether the contested measure respects the requisite fair balance
and, notably, whether it imposes a disproportionate burden on the
applicants. In this connection, the Court has already found that the
taking of property without payment of an amount reasonably related to
its value will normally constitute a disproportionate interference
and a total lack of compensation can be considered justifiable under
Article 1 of Protocol No. 1 only in exceptional
circumstances (see Jahn and Others, cited above, § 94).
The Court first observes that the Property Act, which
governs disputes concerning property situated in the former GDR,
grants a priority right of restitution to the heirs of the original
Jewish owners, who were the initial injured party. The heirs of
owners whose property was expropriated in the former GDR, who are
thus the subsequent injured party, like the applicants in the present
case, are entitled to compensation under the Compensation Act (see
relevant domestic law and practice, paragraph 31 above).
In
this connection the Court further points out that the State has a
wide margin of appreciation as regards the enactment of laws in the
exceptional context of German reunification, having regard to the
enormous task faced by the legislature in dealing with all the
complex issues which inevitably arose at the time of transition from
a communist regime to a democratic market-economy system (see, in
particular, von Maltzan and Others, cited above, §§
74, 77 and 110; Jahn and Others, cited above, § 113;
and lastly, mutatis mutandis, Vistiņš and
Perepjolkins v. Latvia, no. 71243/01, § 85, 8 March
2011).
The
particularity of the present case is that, eight years after German
reunification and six years after the expiry of the statutory
time-limit for restitution claims based on the Property Act, the
legislature retrospectively amended section 30a(1) of the Property
Act to the effect that this time-limit did not apply to the FRG’s
rights under the German-US Agreement. That legislative amendment,
whilst admittedly being of a general nature, created an inequality to
the State’s advantage and to the detriment of the applicants,
who were deprived of any right to restitution of the property in
question or to payment of the proceeds of the sale that took place
after reunification.
The Court indicates that whilst, in principle, the
legislature is not precluded in civil matters from adopting new
retrospective provisions to regulate rights arising under existing
laws, the principle of the rule of law and the notion of fair hearing
enshrined in Article 6 preclude any interference by the legislature –
other than on compelling grounds of general interest – with the
administration of justice designed to influence the judicial
determination of a dispute (see, mutatis mutandis, Stran
Greek Refineries and Stratis Andreadis, cited above, § 49;
National & Provincial Building Society, Leeds Permanent
Building Society and Yorkshire Building Society, cited above, §
112; Zielinski and Pradal and Gonzalez and Others v. France
[GC], nos. 24846/94 and 34165/96 to 34173/96, § 57,
ECHR 1999 VII; and Varnima Corporation
International S.A. v. Greece, no. 48906/06, §§
26-35, 28 May 2009).
In
the present case, in relation to Article 1 of Protocol No. 1, what
appears decisive in the Court’s view is, first, the fact that
the initial time limit under the Property Act applied to all
property claims, including those arising from the German-US
Agreement. The law of 21 December 1992 had not contained any special
provisions exempting the FRG from filing such a claim (judgments of
the Federal Administrative Court of 26 May 1999 and 21 January
2004 –see paragraphs 35 and 24 above).
Moreover,
it is undeniable that the German State was aware of the situation
before the expiry of the statutory time-limit initially fixed by the
legislature on 31 December 1992, given that the German-US Agreement
had been signed on 13 May 1992. The State thus had more than seven
months in which to file a claim in the prescribed form.
The
Court further notes that the retrospective amendment of 20 October
1998 of the initial version of section 30a(1) of the Property Act
took place as much as eight years after German reunification became
effective on 3 October 1990 and six years after the expiry of the
statutory time-limit on 31 December 1992.
The
time taken by the legislature is a factor to be taken into
consideration in assessing proportionality (see in particular Jahn
and Others, cited above, § 116 (b), where the Court referred
to the fairly short period of time (two years) that elapsed between
German reunification becoming effective and the enactment of the
second Property Rights Amendment Act), even though, in the present
case, this belated amendment may be explained by the fact that the
FRG did not pay the total sum of the compensation until 29 April 1997
(see paragraph 18 above).
Similarly, even though the formal decision of the
Office of the Land of 12 July 2001 ruling on the restitution
claim postdated the legislative amendment of 20 October 1998, the
time that elapsed between the filing of the restitution claim on 10
October 1990 and the decision of the Office of the Land was
ten years and six months, which also appears excessive.
Lastly,
an essential factor in the assessment of proportionality is the
burden imposed on the applicants by this legislative amendment:
unlike the situation in Jahn and Others, cited above, where
the second Property Rights Amendment Act did not provide for any
compensation for the applicants (§ 110), in the present
case the Compensation Act provides for the payment of compensation.
However, the amount does not appear proportionate to the seriousness
of the interference in question, consisting of a retrospective
legislative amendment which created an inequality to the State’s
advantage and to the applicants’ disadvantage. Moreover, it is
not certain that the applicants will be able to obtain any
compensation at all, as the Government alleged that they had not
filed their claim within the statutory time-limit and the
Administrative Court has stayed the proceedings pending the Court’s
judgment.
Having
regard to the very particular circumstances of the present case, and
in spite of the wide margin of appreciation afforded to the State in
the exceptional context of German reunification, and of the
legitimate aim of the German legislature to secure the State’s
assets under the German-US Agreement, the Court finds that the
legislative amendment in question upset the “fair balance”
that is to be struck between the protection of property and the
demands of the general interest.
There
has therefore been a violation of Article 1 of Protocol No. 1.
II. ALLEGED VIOLATION OF ARTICLE 14 OF THE CONVENTION
TAKEN TOGETHER WITH ARTICLE 1 OF PROTOCOL NO. 1
The applicants claimed to have been victims of
discrimination contrary to Article 14 of the Convention, taken
together with Article 1 of Protocol No. 1. Article 14 is drafted as
follows:
“The enjoyment of the rights and freedoms set
forth in [the] Convention shall be secured without discrimination on
any ground such as sex, race, colour, language, religion, political
or other opinion, national or social origin, association with a
national minority, property, birth or other status.”
The
applicants argued that the time-limit provided for by section 30a(1)
of the Property Act applied to all restitution claims, including
those of the State. The legislative amendment to the State’s
advantage and to the detriment of the applicants had thus constituted
discrimination, for which there was no justification.
The Government argued that the situation of the
applicants, whose rights stemmed from an expropriation enforced in
the former GDR, could not be compared to that of the Government,
which had succeeded to rights based on a policy of providing redress
for injustice committed under the National Socialist regime.
Accordingly, Article 14 of the Convention was not applicable. In the
alternative, the difference in treatment was based on objective and
reasonable justification having regard to the legislature’s
wish to clarify an unclear situation by means of the 1998 Act.
In view of its finding of a violation concerning the
applicants’ right to the peaceful enjoyment of their
possessions (paragraphs 68-74 above), the Court does not find it
necessary to examine the applicants’ complaint under Article 14
of the Convention taken together with Article 1 of Protocol No.
1.
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.”
Under
the head of pecuniary damage the applicants claimed a sum equivalent
to that of the proceeds of the sale of the property on 17 October
1997, namely 664,680 euros (EUR), plus EUR 544,060 in default
interest accruing since that, for a total of EUR 1,208,740.
As
regards the costs and expenses incurred before the domestic courts
(Potsdam Administrative Court, Federal Administrative Court and
Federal Constitutional Court), the applicants claimed, producing
supporting documents, the sum of EUR 65,237.80, covering lawyers’
fees and court costs. As to the costs and expenses incurred before
the Court, the applicants claimed EUR 17,490 and produced the
corresponding statement of fees.
The
total amount claimed for costs and expenses is therefore
EUR 82,727.80.
The
Government left it to the Court’s discretion to decide on the
amount of any just satisfaction that might be awarded to the
applicants.
The
Court observes that the question of the application of Article 41 is
not ready for decision. Accordingly, it should be reserved and the
subsequent procedure fixed, having regard to any agreement that might
be reached between the Government and the applicants.
FOR THESE REASONS, THE COURT UNANIMOUSLY
Holds that there has been a violation of Article
1 of Protocol No. 1 to the Convention;
Holds that it is not necessary to examine the
complaint under Article 14 of the Convention in conjunction with
Article 1 of Protocol No. 1 to the Convention.
Holds that the question of the application of
Article 41 is not ready for decision;
and
accordingly,
(a) reserves the said question in whole;
(b) invites the Government and the applicants to
submit, within three months from the date on which the judgment
becomes final in accordance with Article 44 § 2 of the
Convention, their written observations on the matter and, in
particular, to notify the Court of any agreement that they may reach;
(c) reserves the further procedure and delegates
to the President of the Chamber the power to fix the same if need be.
Done in French and in English, and notified in writing on 8 December
2011, pursuant to Rule 77 §§ 2 and 3 of the Rules of Court.
Claudia
Westerdiek Dean Spielmann
Registrar President
Application no. 5631/05
Althoff
and Others ./. Germany
List
of applicants
|
Surname
|
Forename
|
Date
of birth
|
Place of birth
|
|
ALTHOFF
|
Edith
|
28.11.1929
|
Düsseldorf –
Germany
|
|
OTLEWSKI
|
Ingrid H.
|
11.11.1935
|
Krefeld- Germany
|
|
SCHMITZ
|
Heinz Ludwig Max
|
08.05.1942
|
Goa – India
|
|
MIASTKOWSKI
|
Miriam Helene
|
27.05.1921
|
Fairfield –
USA
|
|
BROICH
|
Hubert Max
|
06.12.1922
|
Merced – USA
|
|
FISCHER
|
Gertrud Franziska
|
25.11.1911
|
Nuremberg –
Germany
|
|
DIETZ
|
Josefine Irmgard
|
31.08.1923
|
Dormagen-Gohr –
Germany
|
|
BÖCKER
|
Hans
|
26.03.1910
|
Minden –
Germany
|
|
HOLZHAUSEN-SPENCER
|
Louise
|
30.06.1930
|
Palm Springs –
USA
|
