ADOLFSSON AND OTHERS v. ICELAND
Inadmissible
David Thór Björgvinsson;Giovanni Bonello;Ján Šikuta;Ledi Bianku;Nebojša Vučinić;Nicolas Bratza;Päivi Hirvelä
The applicants, (1) Mr Hilmar Kristinn Adolfsson, (2) Mrs Ragnheidur Hauksdóttir and (3) Mr Sveinbjörn Egill Hauksson are Icelandic nationals who were born respectively in 1935, 1948 and 1954. The first and third applicants reside in Reykjavík and the second applicant in Kópavogi, Iceland. They are represented before the Court by Mr Einar Gautur Steingrímsson, a lawyer practising in Reykjavík. The Icelandic Government were represented by their Acting Agent, Mrs Ragna Árnadóttir, of the Ministry of Justice and Ecclasiastical Affairs. The facts of the case, as submitted by the parties, may be summarised as follows. The applicants were the direct heirs of Mrs Margrét þorsteinsdóttir (“M.”), who was born on 29 August 1903 and who died on 22 February 2000. M. had stated in her will, made in 1971 that all her property was to be divided after her death equally between her brother, X, and a woman named Hulda Sveinbjörnsdóttir (“H.”). It was also stated that if X were to die before M, all her property should pass to H., and if she was no longer alive, to her children and grandchildren. There were no blood ties between M. and H. who had been married to M.’s stepson Y. Both Y. and his father Z. had died before 1971 when M. made her will. The second and third applicants are the children of H. and the first applicant is the husband of Svava Hauksdóttir another child of H., sister of the second and third applicants, who is now deceased. In February 1990 a deceased brother of M. left her a considerable inheritance. M. was hospitalised in September 1991 on account of her mental condition and her inability to take care of herself. She was diagnosed as suffering from Dementia Senilis 290.0. In the meantime, in February 1993, Mr G.S., Attorney, and Mr G.K. and Mrs K.P. were convicted of embezzlement of M.’s assets during the years 1991-1992. As from 17 July 1992 M. was, at the request of H., declared incapable of managing her own financial affairs. On 20 July 1992 the District Commissioner of Reykjavík (hereinafter referred to as “the Commissioner”) appointed S.R. as M.’s legal trustee. At that time information about various financial irregularities involving S.R. was on public record, including a number of warrants of execution issued against his company (1985-1987), a petition for bankruptcy and liquidation of the company to cover preferential claims amounting to 25,000,000 Icelandic Crowns (ISK) (1989), a conviction and three months’ conditional prison sentence for embezzlement of employees’ salaries (1990), plus a number of petitions for bankruptcy (1990 and onwards). In 1997 H. passed away. On 17 March 1998 the Commissioner requested S.R. to provide yearly reports regarding decisions he had taken on M.’s behalf. Thereafter, in the absence of any such reports, renewed requests were made on 9 June 1998, 3 May 1999 and 2 June 2000. On 9 October 2002 S.R. was convicted of embezzlement of M.’s assets, in respect of amounts totalling ISK 7,908,943 (approximately 90,000 euros) and was sentenced to 18 months’ imprisonment. On 1 April 2004 the first applicant’s deceased wife and the second and third applicants instituted civil compensation proceedings against the Commissioner and the State, on the ground that M. had sustained damage as a result of the appointment, as a legal trustee, of a person who had a very dubious past. They claimed that upon M.’s death this claim had passed to them as M.’s heirs. On 11 January 2005 the Reykjavík District Court found in favour of the respondent and rejected the plaintiffs’ claim, finding no ground for imposing strict liability, nor any basis for finding negligence since the Commissioner had had no reason to believe that S.R. was unfit to be a custodian when he was appointed. According to the summary of facts contained in the District Court’s judgment, the plaintiffs were granted permission to carry out a private division of M.’s estate on 14 April 2000 and completed their division of the estate in September 2001. In its conclusions, the District Court held inter alia that the estate at the time of M.’s death could not be considered a party to the case, as the division of the estate had been concluded in September 2001. On 11 April 2005 the Supreme Court upheld the lower court’s judgment, giving the following reasoning: “The Supreme Court concurs with the District Court that in order for the defendant to be held liable for the losses suffered by the [applicants] and caused by the guardian, it must be demonstrated that this was due to neglect on the part of the defendant’s employees. The circumstances which resulted in the appointment of the guardian are not entirely clear. Nevertheless, it appears to be established that the person who was appointed guardian had taken the initiative in having the testator deprived of her financial competence; it appears that there was reason for doing so, and that the mother of the appellants, Ragnheiður and Sveinbjörn, was consulted on this; she has since died, but at the time she was M.’s sole heir. At the time that the guardian was appointed, the estate of a limited company of which he was in charge was the subject of liquidation proceedings, and sentence had been passed on him in the Hafnafjörður and Garðir Criminal Court for not having transferred money which the company had collected from its employees. On the other hand, there is no evidence to suggest that he was not competent to manage his own financial affairs and in other respects he met, formally, the conditions for being appointed as a guardian according to section 29 of the then applicable Legal Competence Act, No. 68/1984. It has not been established that the District Commissioner should have suspected that he would discharge his duties of financial management badly. With the introduction of the Legal Competence Act, No. 71/1997, great changes were made in the legal provisions and practice regarding reporting by guardians and the supervision of their work. Repeated attempts by the Commissioner’s employees to have the guardian comply with his statutory duties under section 63 (3) of that Act to report, straightaway in the early part of 1998, produced no result. It can be deduced from the ... District Court’s judgment of 14 April 2002 that by that date most of the damage had been done. From the above, it follows that even if the application of the law by the Commissioner’s office should have been more efficient, it has not been established that the Commissioner or his employees violated their official duties and so brought compensatory liability on the defendant. In the light of these considerations, the District Court’s judgment must be upheld.” Section 27 of the Inheritance Act, No. 8/1962, provides: “An heir may not dispose of an inheritance which he expects to receive.” This provision has been understood as placing a prohibition on any type of disposal, whether by assignment, mortgage or other deed, of an inheritance which has not yet devolved on the recipient. It also follows from this provision that an inheritance that has not yet devolved on the recipient cannot be the object of execution measures carried out against the person who expects to receive the inheritance. The rule reflects accepted academic views on the concept of “property” in Icelandic law. One of the foremost conditions for any right to be considered “property” is that it is both unconditional and active so that the owner in question can dispose of it as if it were his property. This provision of the Inheritance Act confirms these views regarding a future inheritance.