Forced Expropriation. The critical time for determining the final value of an expropriation compensation unit is the time the discussion takes place where the substance of the case is being investigated in court.

JUDGMENT

Tsigaras v. Greece 14-11-2019 (no. 12576/12)

see here 

SUMMARY 

Without the payment of a reasonable amount of compensation proportionate to the value of the expropriated property, deprivation of property is generally an excessive violation of the right to peaceful enjoyment. The appropriateness of the compensation would be reduced if it were to be paid without taking into account various situations which could reduce its value, such as the unjustified delay. The compensation should correspond to the value of the expropriated property at the time of the hearing before the appellate court, where the substance of the case is being investigated and not the one where the case was heard and subsequently postponed or for any other reason. Therefore the critical time for determining compensation should not necessarily be the time of the first hearing, but the one closest to the time of payment.

PROVISION

 Article  6 § 1 

Article 1 of the First Additional Protocol

PRINCIPAL FACTS 

The applicant was born in 1964 and lives in Amfithea.

On 31 December 2002 the Greek State, in a joint decision by the Minister of Finance and Economics and the Minister for the Environment, Regional Development and Public Works, expropriated some properties, including one which belonged to the applicant, in order to make improvements to the National Road of Ioannina-Antirrio in the vicinity of Amfilochia. The property expropriated from the applicant included a plot of 2,033 sq. m that was part of a larger piece of land measuring 2,991 sq. m. On the part of his land that was not expropriated there was a single-storey building used by the applicant as his domestic residence, measuring 101.60 sq. m, with a basement of equal dimensions.

On 30 April 2004 the Greek State brought an action before the Arta Court of First Instance with a view to determining a provisional unitary amount of compensation per square metre of each expropriated property. The case was initially scheduled to be heard on 4 June 2004 but was adjourned. The Court of First Instance held a hearing of the case on 1 October 2004 and issued its decision determining the provisional unitary amount of compensation on 12 November 2004.

On 10 May 2005 the applicant brought an action in the Ioannina Court of Appeal to determine the final unitary amount of compensation. He also sought special compensation for the remainder of his property, that is to say for the remaining portion of his land measuring 958 sq. m and the building on it. The hearing before the Court of Appeal took place on 21 September 2005. On 2 February 2006 the court issued decision no. 70/2006, adjourning the examination of the merits of the case on the grounds that an expert report was required to assess the value of the expropriated property. It subsequently scheduled a new hearing of the case for 17 May 2006. On that date the court adjourned the hearing until 18 April 2007, then adjourned it again until 16 April 2008. Following another adjournment, the hearing eventually took place on 5 November 2008. All adjournments were due to the fact that the experts report had not yet been completed.

In a judgment of 29 June 2009 (no. 224/2009) the Ioannina Court of Appeal set the final unitary amount of compensation at 40 euros per square metre. It also set the special compensation for the remainder of the land that had not been expropriated at 10 euros per sq. m. Lastly, it assessed the value of the building located on that part of the applicants land at 125,000 euros and its lost value at 50,000 euros. In total, the applicant was awarded 140,900 euros. The material date that the court took as the basis for calculating the compensation was 1 October 2004, that is to say the date of the hearing concerning provisional compensation, on the grounds that the first hearing concerning the setting of final compensation had been held on 21 September 2005, which was less than a year after the date of the hearing concerning provisional compensation (Article 17 § 2 of the Constitution).

On 14 September 2010 the applicant lodged an appeal on points of law with the Court of CassationHe claimed, inter alia, that the Court of Appeal had erred in taking the date of the hearing concerning the provisional compensation as the material time for the setting of the compensation. He argued that in determining the final compensation, the court should have taken the date of the hearing concerning final compensation, 5 November 2008, when examination on the merits had taken place, resulting in judgment no. 224/2009 by which he had been awarded compensation. Therefore, pursuant to Article 17 § 2 of the Constitution, more than a year had elapsed between the hearing concerning the setting of provisional compensation and that concerning the setting of final compensation. In view of the above, the final compensation should have been set with reference to the hearing of 5 November 2008. In the applicants view, the hearing of 25 September 2005 should not have been taken into account, as it had resulted not in a ruling on the merits but rather in decision 70/2006 by which the examination on the merits had been adjourned and an expert report ordered.

The case was heard on 28 April 2011 by the plenary of the Court of Cassation because the issue at stake was of significant legal interest. On 29 September 2011 the plenary of the Court of Cassation dismissed the applicantappeal on points of law (judgment no. 14/2011). As regards the material time for determining the compensation, referring to Articles 111, 223, 224 and 281 of the Code of Civil Procedure, a majority of twenty-three judges of the Court of Cassation held that it was the first hearing (of 21 September 2005) that should have been taken into account regardless of whether or not the examination on the merits had taken place on that date  on the grounds that “during that hearing the subject of the evidence procedure and of judicial research was being determined”. A minority of thirteen judges disagreed with the above-mentioned conclusion on the grounds that Article 17 § 2 of the Constitution implied that its purpose was for individuals who had been deprived of their property to be given full compensation corresponding to the value of the property as at a date closer to the date of payment. Therefore, in the present case, the material time to be taken should have been the last hearing before the decision on the merits had been issued.

The judgment was finalised (καθαρoγραφή) on 4 October 2011 and it was archived on 4 November 2011, on which date it was possible to obtain a copy.

THE DECISION OF THE COURT

ARTICLE 1 OF THE FIRST ADDITIONAL PROTOCOL

The Court reiterates that Article 1 of Protocol No. 1, which guarantees in substance the right of property, comprises three distinct rules. The first rule, which is set out in the first sentence of the first paragraph, is of a general nature and enunciates the principle of 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, by enforcing such laws as they deem necessary for the purpose. However, the rules are not “distinct” in the sense of being unconnected. The second and third rules are concerned with particular instances of interference with the right to the peaceful enjoyment of property, and should therefore be construed in the light of the general principle enunciated in the first rule.

In the present case, the Court notes that the applicants complaint does not concern the deprivation of property but the setting of the compensation awarded to him. It therefore falls to be examined under the first sentence of the first paragraph of Article 1 of Protocol No. 1, which lays down the principle of the peaceful enjoyment of property in general terms . Therefore, the Court must assess whether a fair balance was struck between the competing interests of the individual and of the community as a whole .

In order to determine whether the measure in question struck a fair balance and, in particular, whether it placed a disproportionate burden on the applicant, account should be taken of the compensation arrangements provided for by the national legislation. In this regard, the Court has already held that without the payment of a sum reasonably commensurate with the value of the property, deprivation of property is normally an excessive infringement of the right to peaceful enjoyment of property . In particular, the adequacy of compensation would be diminished if it were to be paid without reference to various circumstances liable to reduce its value, such as unreasonable delay . In similar cases, the Court has mainly sought to ascertain whether the administration re-evaluated the compensation to be awarded on account of its depreciation owing to the lapse of time .

Turning to the circumstances of the present case, the Court notes at the outset that under Article 17 § 2 of the Greek Constitution, if more than a year has elapsed between the hearing date concerning provisional setting of compensation and the hearing date concerning final setting of compensation, then the value has to be assessed with reference to the latter date. The Court has already held that the purpose of that provision is to assess the compensation with reference to the date which is appropriatein order for “full compensation” to be paid, as required by the wording of the provision itself . The plenary of the Court of Cassation, in interpreting that provision, considered that the hearing that should be taken into account for calculating the compensation was the first hearing of the case, irrespective of whether it had been adjourned or the case had not been examined on the merits for any reason, because “during that hearing the subject of the evidence procedure and of judicial research was being determined.

The Court of First Instance assessed the provisional unitary amount of compensation based on the date of the hearing before it on 1 October 2004. The hearing for the setting of the final unitary amount of compensation was scheduled to take place on 21 September 2005. However, at the hearing on that date the court did not pronounce the final unitary amount of compensation, but issued decision no. 70/2006 adjourning the examination of the merits of the case and ordering an expert report on the value of the property. Following several adjournments on the grounds that the experts report had not yet been delivered, the hearing at which the case was examined on the merits took place on 5 November 2008In a judgment of 29 June 2009, the Court of Appeal assessed the final unitary amount of compensation taking the date of the hearing concerning the provisional compensation as the material date. They reasoned that the first hearing concerning the setting of final compensation had been held on 21 September 2005, which was less than a year after the date of the hearing concerning provisional compensation.

 The Court notes that it is not its task to take the place of the national authorities in determining the exact amount of compensation the applicant should have received given the fluctuations in the property market, inflation or any other factors. However, having regard to the fact that more than four years had elapsed from the date that was taken as the material date for the assessment of the final unitary amount of compensation and the date on which the actual hearing on the merits had taken place, the Court notes that the domestic authorities failed to take into consideration any factors that might have rendered the compensation no longer commensurate with the value of the property as at the date of its judgment, namely 29 June 2009 . The Court further notes that the delay in the setting of final compensation cannot be attributed to the applicant, who made normal use of domestic remedies. It concludes that the domestic courts should have taken into account the various circumstances liable to reduce the value of the compensation awarded.

The Court takes note of the Governments argument that the circumstances of the present case differ than those of the Poulimenos case , in which it found a violation of Article 1 of Protocol No. 1 to the Convention because twelve years had elapsed from the date that had been considered as the reference point for the setting of compensation and the date on which it had been awarded. However, in the Courts view, notwithstanding the fact that in one case the lapse of time had been significantly longer, the facts of the two cases remain similar, as in both cases the domestic courts failed to take into account the effect that the lapse of time might have had on the value of the expropriated properties.

The Court thus considers that the applicant had to bear an excessive individual burden, which upset the fair balance to be maintained between the demands of the general interest on the one hand and protection of the right to the peaceful enjoyment of possessions on the other . Therefore, the Court dismisses the Governments objection that the complaint is inadmissible ratione personae and finds that there has been a violation of Article 1 of Protocol No. 1 to the Convention.

ALLEGED VIOLATION OF ARTICLES 6 AND 13 OF THE CONVENTION ON ACCOUNT OF THE LENGTH OF THE PROCEEDINGS AND THE LACK OF AN EFFECTIVE REMEDY IN THAT RESPECT

The applicant complained that the length of the proceedings before the domestic courts had been incompatible with the “reasonable time” requirement laid down in Article 6 § 1 of the Convention. He also complained that, at the time, there had been no effective domestic remedy for his complaint concerning the length of the proceedings.

The Courts assessment

(a)   Period to be taken into consideration

 The period to be taken into consideration started on 30 June 2004, the date on which the application for setting of a provisional unitary amount of compensation was lodged. It ended on 4 November 2011, when the Court of Cassation rendered a final judgment in the case (no. 14/2011). Therefore, the proceedings lasted in total seven years, six months and four days at three levels of jurisdiction .

(b)   Reasonableness of the length of proceedings

The Court reiterates that the reasonableness of the length of proceedings must be assessed, in accordance with its well-established caselaw, in the light of the circumstances of the case and with reference to the following criteria: the complexity of the case, the conduct of the applicants and the relevant authorities, and what was at stake for the applicants in the dispute .

The Court has examined on many occasions cases raising questions akin to the one in issue here – namely the duration of civil proceedings and concluded that there had been a breach of Article 6 § 1 .

Even accepting the Governments argument that the case presented a certain complexity and that an experts report was necessary to assess the properties value, the Court notes that the proceedings lasted more than seven years at three levels of jurisdiction. Having regard to its case-law on the subject, the Court considers that the Government have advanced no fact or argument justifying a different conclusion in the present case. Therefore, in the instant case the length of the proceedings was excessive.

Accordingly, there has been a breach of Article 6 § 1 of the Convention.

 Turning to the applicants complaint under Article 13 of the Convention, the Court reiterates that Article 13 guarantees an effective remedy before a national authority for an alleged breach of the requirement under Article 6 § 1 to hear a case within a reasonable time .

 Moreover, the Court has already had the opportunity to observe that at the material time the Greek legal system did not offer the interested parties an effective remedy, within the meaning of Article 13 of the Convention, enabling them to complain about the length of proceedings . In the light of the foregoing considerations, the Court finds that there has been a violation of Article 13 of the Convention in that the applicant had no domestic remedy whereby he could enforce his right to a “hearing within a reasonable time” as guaranteed by Article 6 § 1 of the Convention.

  1. Damage

 The applicant claimed 49,315 euros (EUR) in respect of pecuniary damage. In particular, he argued that according to data provided by the Bank of Greece, property prices had increased by 35% between October 2004 and November 2008. Therefore, the compensation he had received, that is to say EUR 140,900, should be recalculated by the above-mentioned percentage and he should be awarded the difference, which in his case amounted to EUR 49,315. The applicant also claimed EUR 85,000 in respect of non-pecuniary damage for the violation of his rights under Article 1 of Protocol No. 1 to the Convention and EUR 15,000 for the violation of his rights under Articles 6 and 13 of the Convention.

The Government argued that it was not the Courts task to assess the compensation that should be awarded to the applicant. In any event, they considered the amounts requested as unjustified and excessive.

  The Court observes that the domestic courts awarded the applicant EUR 140,900 based on their assessment of the value of his expropriated property in October 2004. Having regard to the information and documents submitted by the parties, the Court considers it reasonable and equitable, as required by Article 41, to award the applicant EUR 35,000 in respect of pecuniary damage. Furthermore, making its assessment on equitable basis, it awards him EUR 4,000 in respect of non-pecuniary damage.

  1. Costs and expenses

The applicant also claimed EUR 1,500 for the costs and expenses incurred before the Court.

 The Government argued that the applicant had failed to prove that all the costs and expenses claimed had been necessary. In addition, they submitted that the amount requested for the proceedings before the Court was excessive.

Regard being had to the documents in its possession and to its case-law, the Court considers it reasonable to award the sum of EUR 1,200 for the costs of the proceedings before the Court.

  1. Default interest

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. Dismisses the Governments preliminary objection of non-exhaustion of domestic remedies;
  2. Joins to the merits the Governments preliminary objection that the application is incompatible ratione personae with the Convention and dismisses it;
  3. Declares the application admissible;
  1. Holds that there has been a violation of Article 1 of Protocol No. 1 to the Convention;
  2. Holds that there has been a violation of Article § 1 of the Convention;
  3. Holds that there has been a violation of Article 13 of the Convention;
  4. Holds

(a)  that the respondent State is to pay the applicant, within three months the following amounts:

(i)        EUR 35,000 (thirty-five thousand euros), plus any tax that may be chargeable, in respect of pecuniary damage;

(ii)      EUR 4,000 (four thousand euros), plus any tax that may be chargeable, in respect of non-pecuniary damage;

(iii)     EUR 1,200 (one thousand two hundred euros), plus any tax that may be chargeable to the applicant, 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;

  1. Dismisses the remainder of the applicant claim for just satisfaction.

ECHRCaseLaw

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