CASE OF KRASTEVA AND OTHERS v. BULGARIA
(Application no. 5334/11)
1 June 2017
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 Krasteva and Others v. Bulgaria,
The European Court of Human Rights (Fifth Section), sitting as a Chamber composed of:
Lәtif Hüseynov, judges,
and Milan Blaško, Deputy Section Registrar,
Having deliberated in private on 9 May 2017,
Delivers the following judgment, which was adopted on that date:
1. The case originated in an application (no. 5334/11) against the Republic of Bulgaria lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (“the Convention”) by four Bulgarian nationals, Ms Donka Ivanova Krasteva (“the first applicant”), Ms Maria Maksimova Piskova (“the second applicant”), Ms Angelina Delova Piskova-Indzhova (“the third applicant”) and Ms Iskra Delcheva Piskova (“the fourth applicant”) (together “the applicants”), on 17 December 2010.
2. The applicants were represented by Ms M. Hristova and Ms A. Gavrilova-Ancheva, lawyers practising in Sofia. The Bulgarian Government (“the Government”) were represented by their Agent, Ms M. Dimova, of the Ministry of Justice.
3. The applicants alleged that they had been unfairly deprived of their title to a plot of land.
4. On 26 May 2015 the complaint above was communicated to the Government and the remainder of the application was declared inadmissible, pursuant to Rule 54 § 3 of the Rules of Court.
I. THE CIRCUMSTANCES OF THE CASE
5. The applicants were born in 1932, 1929, 1965 and 1956 respectively and live in Sofia.
6. On 15 January 1968 the second applicant, together with the antecedents of the other applicants, bought from the then existing local agricultural co-operative a plot of land situated on the outskirts of Sofia measuring 953 square metres. Until 2002 the applicants or their antecedents enjoyed undisturbed possession of that land.
7. On 10 May 2002 a group of persons, the heirs of Mr T.S., Mr G.S. and Ms K.S., brought against the applicants a rei vindicatio action, stating that the plot of land was theirs. They stated that the plot, once the property of their antecedents, had been collectivised in the years after 1945, but had been returned to them within the context of the process of the restitution of agricultural land by a decision of the relevant body, the local land commission, dated 27 December 1999. They claimed that under section 10(13) of the Agricultural Land Act (see paragraph 13 below), the fact that the second applicant and the remaining applicants’ antecedents had purchased the land in 1968 could not be held against them.
8. Initially, the Sofia District Court (its judgement is undated) dismissed the action against the applicants. After an appeal by the heirs of Mr T.S., Mr G.S. and Ms K.S., on 5 November 2009 the Sofia City Court overturned that ruling, allowed the rei vindicatio claim and ordered the applicants to surrender possession of the plot. It found in particular that the land commission’s decision of 27 December 1999 was sufficient to render the claimants the owners of the disputed land. It pointed out that of the two rival claims to the same plot the law - namely section 10(13) of the Agricultural Land Act - gave priority to the one based on restitution, and thus had the effect of rendering devoid of any legal force the contract under which the second applicant and the remaining applicants’ predecessors had bought the plot.
9. In a final decision of 18 June 2010 the Supreme Court of Cassation declined to entertain a cassation appeal by the applicants.
10. On an unspecified date soon after that the applicants surrendered possession of the plot.
II. RELEVANT DOMESTIC LAW AND PRACTICE
11. The Agricultural Land Act (Закон за собствеността и ползването на земеделските земи) was enacted in 1991. It entitled individuals whose land had been collectivised (or their heirs) to request ‒ in certain circumstances ‒ the restoration of their ownership.
12. At the time of its enactment the Agricultural Land Act did not expressly address situations where restitution was sought in respect of plots which had been acquired by third parties after the collectivisation process. In an interpretative decision of 25 June 1996 (Тълкувателно решение № 2 от 25.VI.1996 г. по гр. д. № 2/96 г., ОСГК) the former Supreme Court found that in situations where post-collectivisation buyers had acted in good faith and their title was not otherwise defective, their rights would prevail over the rights of parties subsequently claiming restitution. It held that:
“[t]he legal effect of valid sale contracts, in accordance with the legislation in force at the time, excludes the right of former owners to obtain restitution of agricultural land ...”
13. The situation changed in 1997, when Parliament added subsection 13 to section 10 to the Agricultural Land Act. The new provision stipulated that former owners’ rights to plots which had not been built on were to be restored even in cases where the land in question had been sold or transferred to third parties. It also provided that those third parties could not rely on acquisitive prescription.
14. In a judgment of 14 November 2000 (Решение № 13 от 14 ноември 2000 г. по к. д. № 11/2000 г.) the Constitutional Court dealt with the compatibility of section 10(13) with the constitutional provisions guaranteeing the right to property. It found that it was compatible with these provisions, pointing out that the owners of land occupied by agricultural co-operatives “had never lost their property rights” but during a certain period of time “had merely been unable to exercise them”; that is why any contracts transferring their land could not be held against them, regardless of whether or not the third parties acquiring the land had acted in good faith. As to the provision that third parties who had acquired land could not rely on acquisitive prescription, the Constitutional Court held:
“Through that provision, the legislature has given precedence to the rights of owners of agricultural land included in [agricultural co-operatives] who by virtue of that [act of inclusion] were deprived of the possibility of exercising their property rights and preventing the possible acquisition of their land by third parties through adverse possession over [the rights of] those who have acquired it through such adverse possession.
The [Constitutional] Court finds that a fair balance between the conflicting fundamental constitutional rights has thus been achieved.”
15. Even before the judgment mentioned above, in several earlier judgments the Constitutional Court took the view that the collectivisation of agricultural land had not extinguished the owners’ property rights, but had merely created obstacles to their exercise (Решение № 6 от 5 юли 1992 г. по к. д. № 9/92 г.; Решение № 8 от 19 юни 1995 г. по к. д. № 12/95 г.).
16. However, before 1989 it was considered that agricultural co-operatives could validly sell land to private individuals (Тълкувателно решение № 16 от 11.III.1977 г. по гр. д. № 86/76 г., ОСГК). Moreover, the former Supreme Court found during that period that upon collectivisation co-operatives had become the owners of collectivised land and that former owners’ rights had become extinguished (Решение № 314 от 25.II.1966 г. по гр. д. № 2484/66 г., I гр. о.; Решение № 2119 от 31.X.1966 г. по гр. д. № 1502/66 г., I гр. о.).
I. ALLEGED VIOLATION OF ARTICLE 1 OF PROTOCOL No. 1
17. The applicants complained, relying on Articles 6 § 1 and 14 of the Convention and Article 1 of Protocol No. 1, that they had been unfairly deprived of their property.
18. The Court is of the view that it suffices to examine the complaints under Article 1 of Protocol No. 1 alone, 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. Submissions by the parties
19. The Government did not comment on the admissibility and merits of the application.
20. Upon the request of the Court, the Government submitted statistical information regarding the number of rei vindicatio claims based on section 10(13) of the Agricultural Land Act that had been examined by the national courts. The data, which did not cover all courts and concerned only the period between 2010 and 2014, showed that between approximately thirty and fifty such cases had been examined by a first-instance court each year. In that regard the Government stated that a “precise analysis at the legislative level” was necessary as regards the possibility of providing for the compensation of persons who had lost their property on the basis of section 10(13).
21. The applicants reiterated their complaint. They relied on the Court’s judgment in the case of Velikovi and Others v. Bulgaria (nos. 43278/98, 45437/99, 48014/99, 48380/99, 51362/99, 53367/99, 60036/00, 73465/01 and 194/02, 15 March 2007), which concerned a similar situation. They argued that their being deprived of their property had not been “lawful”, as required by Article 1 of Protocol No. 1, because the addition of section 10(13) to the Agricultural Act in 1997 had been unforeseeable and in breach of the rule of legal certainty and had interfered with fundamental legal principles such as the protection of good-faith buyers and the application of acquisitive prescription. Moreover, the applicants pointed out that the taking of their property to satisfy other parties’ restitution claims could not be associated with the social and economic transition of Bulgaria following totalitarian rule and that their title to the disputed land had not been found to be in any way defective. Lastly, the applicants noted that they were not entitled to any compensation for the land taken from them, and that they could not claim back the price paid for it at the time of its purchase, because the seller (the local agricultural co-operative) no longer existed and because in any event the figure paid in 1968 had lost its real value over the years since.
B. The Court’s assessment
22. The Court notes that the application is not manifestly ill-founded within the meaning of Article 35 § 3 (a) of the Convention. It further notes that it is not inadmissible on any other grounds. It must therefore be declared admissible.
23. On the merits, the Court starts by observing that the present case is similar to Tomov and Nikolova v. Bulgaria (no. 50506/09, 21 July 2016), which it recently examined, and which also concerned the application of section 10(13) of the Agricultural Land Act.
24. As in that case, in the case at hand the Court finds that there was State interference with the applicants’ rights which amounted to deprivation of property within the meaning of the second sentence of Article 1 of Protocol No. 1 (see Tomov and Nikolova, cited above, §§ 42-44). In order to comply with the requirements of that provision, any such deprivation must be lawful and in the public interest and must strike a fair balance between the demands of the general interest and the requirement to protect the fundamental rights of the individual in question.
25. In analysing these issues in Tomov and Nikolova the Court applied the principles developed by it in a series of cases against Bulgaria concerning the effect of restitution on third parties, albeit in respect of the application of different legislation, starting with the leading case of Velikovi and Others (cited above; some of the follow-up cases are cited in §§ 38-39 of the Tomov and Nikolova judgment).
26. It thus found that the interference with the applicants’ rights could not be seen as an exceptional transitional measure related to the period of social and economic transformation, as it had been based on a legislative provision, namely section 10(13) of the Agricultural Land Act, which had been enacted in 1997 - long after the beginning of the transformation process (see Tomov and Nikolova, cited above, §§ 46-8). In the Velikovi group of cases (see for example the case of Tsonkovi v. Bulgaria, no. 27213/04, §§ 24-27, 2 July 2009) it has already held that challenging property titles, sometimes decades-old, could in principle be seen as justified only when associated with the unique transitional period which started in Bulgaria in 1989. Moreover, under the provisions of the Agricultural Land Act, the possibility for former owners benefitting from positive restitution decisions to challenge the titles of persons who had bought the land after the collectivisation was definitely not subject to a time-limit, and the post-collectivisation owners could not rely on acquisitive prescription (see Tomov and Nikolova, cited above, § 48). Lastly, it was significant that, unlike in the cases of the Velikovi group, in the case at hand it was not necessary for the persons claiming the restitution of the applicants’ land to show that the latter’s title was in any way defective; rather, it had been sufficient for them to rely on section 10(13) of the Agricultural Land Act, which quite simply wiped out the legal force of contracts of sale concluded many years earlier (ibid., § 49). On that basis the Court concluded in Tomov and Nikolova that the taking of the applicants’ property had breached the principle of legal certainty and did not fall within the scope of legitimate aims such as restoring justice and the rule of law, which the restitution provisions of the Agricultural Land Act could have pursued in principle (ibid., § 51).
27. The Court sees no reason to reach a different conclusion in the case at hand, which, as already noted, concerns the application of the same legislation as that relied on in Tomov and Nikolova. Accordingly, it concludes that the taking of the applicants’ property in the case violated the principle of legal certainty and did not fall within the scope of the legitimate aims pursued by the restitution.
28. As in Tomov and Nikolova (see § 52 of the judgment) and in those cases in the Velikovi group where it reached a similar conclusion (for example, the cases of Todorova and Eneva and Dobrev which were examined in Velikovi and Others - see §§ 236-49 of the judgment), the Court finds that in the circumstances of the instant case nothing short of compensation “reasonably related to the market value” of the property lost could maintain the requisite fair balance under Article 1 of Protocol No. 1. However, the applicable legislation did not provide for compensation for persons in a situation such as that of the applicants. In addition, as pointed out by the applicants (see paragraph 21 above in fine), they could not seek the repayment of the price paid for the land in 1968, because the seller at the time, the agricultural co-operative, apparently no longer existed, and in any event they could have only obtained a token amount, given the domestic courts’ practice of refusing to re-evaluate monetary claims (see, on the latter point, Tomov and Nikolova, cited above, § 24, with further references).
29. Accordingly, as in Tomov and Nikolova (see § 54 of the judgment), the Court concludes that depriving the applicants of their property, in breach of the principle of legal certainty and without any possibility of compensation, was a clearly disproportionate measure.
30. Consequently, there has been a breach of Article 1 of Protocol No. 1.
II. APPLICATION OF ARTICLE 46 OF THE CONVENTION
31. Article 46 of the Convention, in so far as relevant, reads:
“1. The High Contracting Parties undertake to abide by the final judgment of the Court in any case to which they are parties.
2. The final judgment of the Court shall be transmitted to the Committee of Ministers, which shall supervise its execution.”
32. Within the context of the execution of judgments in accordance with Article 46 of the Convention, a judgment in which the Court finds a violation of the Convention or its Protocols imposes on the respondent State a legal obligation not just to pay those concerned the sums awarded by way of just satisfaction, but also to choose, subject to supervision by the Committee of Ministers, the general measures to be adopted in its domestic legal order. Furthermore, in ratifying the Convention (Article 1 in particular) the Contracting States undertook to ensure that their domestic legislation is compatible with it (see Maestri v. Italy [GC], no. 39748/98, § 47, ECHR 2004-I, and Viaşu v. Romania, no. 75951/01, § 80, 9 December 2008).
33. In the case at hand, the Government submitted statistical information which showed that many years after the beginning of the restitution process a significant number of pre-restitution titles to agricultural land continued to be challenged under section 10(13) of the Agricultural Land Act (see paragraph 20 above). Moreover, there is still no limitation in time of the possibility for restitution owners to claim land relying on that provision.
34. In order to assist the respondent Government in the fulfilment of their obligations under Article 46 § 1 of the Convention, the Court expresses the view that the general measures taken in the execution of its judgment in this case should include the introduction into domestic law of a remedy capable of ensuring that persons who have lost their property on the basis of section 10(13) can secure compensation reasonably related to the market value of the respective property; the Government also acknowledged that it could be necessary to take such measures (see paragraph 20 above).
III. APPLICATION OF ARTICLE 41 OF THE CONVENTION
35. 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.”
36. In respect of pecuniary damage, the applicants claimed, firstly, 121,030 euros (EUR) in respect of the value of the land taken from them. The claim was based on a valuation undertaken in April 2016 by an expert appointed by the applicants. The plot at issue is situated in a residential area at the foot of Vitosha Mountain, on the outskirts of Sofia. The report described it as being eligible for construction despite its being located on a steep slope, and as being close to a bus station and a main road, albeit accessible only via a dirt road. On the basis of information in respect of other similar plots being offered for sale in the area, the expert assessed the “most likely selling price” of the plot at issue at EUR 127 per square metre, or the above-mentioned sum of EUR 121,030 for the whole plot of 953 square metres.
37. The applicants claimed, in addition, compensation for lost opportunity as they had been unable to use their land after surrendering it to the heirs of Mr T.S., Mr G.S. and Ms K.S. They explained that they had used the land for spending time outdoors, as well as to grow fruit and vegetables. They invited the Court to make an award in equity under this head, noting nevertheless that they considered the amount of EUR 700 per year (EUR 3,850 for five and a half years at the time of the submission of their claims) just.
38. The applicants requested the Court to make an award to each of them according to their respective shares in the plot of land, namely one-half for the first applicant, one-third for the second applicant and one-twelfth each for the third and fourth applicants.
39. Lastly, the applicants claimed EUR 3,500 for each of them in respect of non-pecuniary damage.
40. The Government contested the claims, considering in particular that the market value of the land was much lower than that which was claimed by the applicants. In support of this argument, they submitted three sale offers published on the Internet for plots of land in the neighbourhood. Two of those plots, offered respectively for EUR 68 and EUR 72 per square metre, were eligible for construction. The third plot, offered for EUR 22 per square metre, was forestry land. In addition, the Government contended that the claim related to lost opportunity was not linked to any violation of the Convention that might be found and that the claims concerning non-pecuniary damage were exaggerated.
41. As regards the applicants’ claim related to the value of the plot which they had lost, the Court has held that illegal or arbitrary dispossessions of property in principle justify restitutio in integrum or the payment of a sum reflecting the current value of the property taken (see, inter alia, Papamichalopoulos and Others v. Greece (Article 50), 31 October 1995, §§ 36-39, Series A no. 330-B, and Brumărescu v. Romania (just satisfaction) [GC], no. 28342/95, §§ 21-24, ECHR 2001-I). This should also be the approach in the present case, in view of the Court’s finding above that the taking of the applicants’ property was in breach of the principle of legal certainty and in view of its approach in earlier similar cases (see Tomov and Nikolova, cited above, § 60, and the just satisfaction judgment in the cases examined in Velikovi and Others, in which the Court found a violation of Article 1 of Protocol No. 1 - Todorova and Others v. Bulgaria (just satisfaction), nos. 48380/99, 51362/99, 60036/00 and 73465/01, § 11, 24 April 2008). As it is impossible to order the return of the land to the applicants because it has passed to private parties, the Court is to make a monetary award reasonably related to its current market value. The Court notes in this respect the lack of clarity as to the potential use of the property and the rather general character of the information, particularly that provided by the Government, on the basis of which it has to establish its market value. Taking into account the information provided, the Court awards the applicants EUR 80,000 under the present head.
42. The Court finds, in the next place, that it is justified to make an award with regard to the losses suffered by the applicants after they surrendered possession of their plot in 2010 (see paragraph 10 above). In view of the manner in which the applicants claim to have used their plot, namely to spend time outdoors and to grow fruit and vegetables (see paragraph 37 above), the Court considers it justified to award them EUR 2,000 under this head.
43. As requested by the applicants, the amounts awarded in respect of pecuniary damage are to be distributed among them in accordance with their shares in the lost plot (see paragraph 38 above).
44. Lastly, in respect of non-pecuniary damage, the Court finds it appropriate to award each of the applicants EUR 1,000.
B. Costs and expenses
45. The applicants also claimed EUR 2,034 for the costs and expenses incurred before the domestic courts in the proceedings described in paragraphs 7-9 above. They claimed another EUR 945 for the proceedings before the Court, an amount which covered postage as well as the fees charged by their lawyers and the expert who had drawn up the valuation report presented in support of their claim for pecuniary damage (see paragraph 36 above). In order to substantiate these claims, the applicants presented invoices and receipts showing that they had paid the equivalent of those amounts in Bulgarian levs.
46. The applicants requested that any amount awarded under the head of costs and expenses be distributed among the first three of them in the following manner: one half for the first applicant and one fourth each for the second and third applicants.
47. The Government contested the claims.
48. According to the Court’s case-law, an applicant is entitled to the reimbursement of 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 documents in its possession and the above criteria, the Court awards the amounts claimed, totalling EUR 2,979, in full. It notes in particular that the expenses in the domestic proceedings were incurred while the applicants were seeking to prevent the violation of their rights, as found in the case. Lastly, the Court holds that the amount awarded is to be distributed among the first, second and third applicants in the manner indicated by them and as described in paragraph 46 above.
C. Default interest
49. The Court considers it appropriate that the default interest rate 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,
1. Declares the application admissible;
2. Holds that there has been a violation of Article 1 of Protocol No. 1;
(a) that the respondent State is to pay the applicants, 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 Bulgarian levs at the rate applicable at the date of settlement:
(i) EUR 82,000 (eighty-two thousand euros), plus any tax that may be chargeable, in respect of pecuniary damage, to be distributed among the applicants according to the size of their respective shares in the property lost;
(ii) EUR 1,000 (one thousand euros) to each applicant, or EUR 4,000 (four thousand euros) in total, plus any tax that may be chargeable, in respect of non-pecuniary damage;
(iii) EUR 2,979 (two thousand nine hundred and seventy-nine euros), plus any tax that may be chargeable to the applicants, in respect of costs and expenses, to be distributed among the first, second and third applicants as indicated in paragraphs 46 and 48 of the judgment;
(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;
4. Dismisses the remainder of the applicants’ claim for just satisfaction.
Done in English, and notified in writing on 1 June 2017, pursuant to Rule 77 §§ 2 and 3 of the Rules of Court.
Milan Blaško Angelika Nußberger
Deputy Registrar President