CASE OF BECVAR AND BECVAROVA v. THE CZECH REPUBLIC
Violation of Art. 6-1;Inadmissible under P1-1;Pecuniary damage - claim dismissed;Non-pecuniary damage - financial award;Costs and expenses partial award - Convention proceedings
4. The applicants were born in 1951 and 1952 respectively, and live in Svoboda nad Úpou. 5. In January 1986 the applicants bought from the State a house, which had been seized after the emigration of the former owners. The applicants made an initial payment of CZK 100,000 by 30 April 1986, the remaining sum of CZK 244,846 to be paid in fifteen annual instalments. However, the purchase was without risk of forfeiture if such an instalment remained unpaid. 6. Pursuant to the Extra-Judicial Rehabilitation Act (hereinafter “the Act”), in December 1991 the former owners brought an action against the applicants for the restitution of their property. In January 1996 the applicants were ordered to restore the property to the former owners. In May 1999 the applicants were ordered to vacate the house within a year of the coming into force of the first instance judgment without receiving compensatory accommodation. 7. In February 2002 the District Court ordered the execution of its judgment for the applicants' eviction. In May 2000 the Regional Court upheld the order. In October 2002 the District Court dismissed the applicants' request to suspend the execution. In April 2003 the Regional Court upheld the District Court's dismissal. 8. On 28 January 2004 the applicants were informed that the eviction would take place on 23 February 2004. On 19 February 2004 the District Court dismissed their request to suspend the eviction. On 23 February 2004, the applicants' lawyer was served with the District Court's dismissal of 19 February 2004 and, on 9 March 2004, she filed an appeal which is still pending before the Regional Court. 9. Apart from the two aforesaid proceedings, the former owners instituted proceedings against the applicants for the illegal use of the house since 1 January 1996, seeking payment of outstanding rent in the amount of CZK 431,000 (13,596 EUR). In these proceedings, which have been pending since 10 October 1997, the applicants sought to recover damages to compensate for expenditure invested in material improvements to the house, filing a counterclaim (kompenzační námitka) for CZE 300,000 (EUR 9,464) on 5 January 1998, apparently under section 7(4) of the Act. This provides that, if the value of the property has increased so that its price, as assessed on the day of the submission of the written request by the entitled person, substantially exceeds the original purchase price of the property, it is left to the discretion of the entitled person whether he or she will request financial compensation or the return of the property. If he or she insists on the surrender of the property, the entitled person must compensate the person obliged to return the property for the difference between the two prices. 10. In September 1997 the applicants lodged with the Ministry of Finance a request for reimbursement of the purchase price, pursuant to section 11 of the Act, which entitles physical persons who are under an obligation to restore property to recover the price they had paid when acquiring such property from the State. On 4 February 1998, upon the Ministry's request of 5 November 1997, they submitted additional documents. On 13 March 1998 their lawyer informed the Ministry that, on 11 March 1998, she had obtained the document of the Svoboda nad Úpou Municipal Office (městský úřad) confirming that the applicants had so far paid CZK 295,888 (EUR 9,334) of the purchase price. In a letter of 15 May 1998, the Ministry informed the applicants' lawyer that they would deal with her clients' request for reimbursement of the purchase price on reception of the restitution agreement (dohoda o vydání věci) which, together with other documents, had not yet been adduced by the applicants. They were further requested to provide evidence of the amount of the purchase price which they had already paid. The applicants' lawyer replied on 9 June 1998. 11. On 18 January 1999 the applicants lodged an action for damages against the Ministry of Finance and the Trutnov District Office (okresní úřad), seeking compensation in the amount of CZK 500,000 (EUR 15,773) for damage caused by the allegedly erroneous action of a public authority by virtue of the State Liability Act, no. 58/1969. The damages which they requested corresponded to the difference between the original purchase price (CZK 344,846 - EUR 10,878) and the price which should now be paid for a house of the same standard. By instituting this action, the applicants further sought to recover damages to compensate for the second applicant's loss of business premises and customers (she is a dressmaker), for the betterment of the land on which the house had been built and for the loss of accommodation. 12. On 15 February and 10 May 1999 respectively, the District Office and the Ministry of Finance presented their comments on the action. 13. On 17 June 1999 the applicants' lawyer sent documents issued by the Svoboda nad Úpou Municipal Office on 7 June 1999 proving that the applicants had already paid CZK 321,212 (EUR 10,133). 14. On 5 October 1999 the applicants' lawyer sent an additional document to the Ministry of Finance concerning their request for reimbursement of the purchase price. 15. On 20 October 1999 the applicants extended their action, also directing it against the Town of Svoboda nad Úpou and the Ministry of the Interior. The two new defendants commented upon the action on 8 November 1999 and 14 February 2000 respectively. 16. According to the Government, on 29 November 1999 the applicants' lawyer informed the Ministry of Finance that the property at issue had been restored to the former owners in accordance with the judgment. She said that her clients did not agree with the judgment and would continue to pay annual instalments towards the purchase price. She stated that she would inform the Ministry whether she wished to have the purchase price reimbursed or whether she would wait. 17. On 28 December 1999 the applicants were invited to submit observations on the arguments of the Ministry of the Interior. They did so on 10 January 2000. 18. By a letter of 24 January 2000 the Ministry of Finance informed the applicants' lawyer that, inter alia, it had all the documents necessary for the settlement of their request for reimbursement of the purchase price under section 11 of the Act. Nevertheless, it asked the lawyer to submit an additional document and to specify whether the sum of CZK 312,212 (EUR 9,848), corresponding to the part of the purchase price which the applicants had paid so far, had to be reimbursed and, if so, to which bank account. 19. At a hearing of 12 October 2000, the District Court invited the applicants to rectify certain shortcomings in their action and to specify which of the four defendants in fact represented the interests of the State. On 12 December 2000 the court urgently reminded the applicants to submit this information. 20. On 12 March 2001 the District Court, upon the applicants' request received on 10 January 2001, adjourned the proceedings pending the Supreme Court's decision on the applicants' appeal on points of law concerning their eviction from the house. 21. On 30 October 2001 the District Court resumed the proceedings for damages, the decision of the Supreme Court of 28 June 2001 rejecting the applicants' appeal having become effective on 19 July 2001. 22. On 2 November 2001 the court invited the applicants to rectify, within four weeks, certain shortcomings in their action, to specify who of the four defendants in fact represented the State, and to quantify their claim for damages. On 16 November 2001 the Ministry of the Interior requested the court to take a decision in this respect. 23. On 18 February 2002 the applicants rectified their action. However, on 24 October 2002, they were requested to rectify further shortcomings and supplement their action. 24. On 28 November 2002, upon the District Court's invitation of 22 October 2002, the applicants specified their arguments on which they based their action for damages. On 18 December 2002 they adduced further documentary evidence, proposing that the District Court ensure the submission of certain additional documents. 25. On 7 February 2003 the Ministry of Finance informed the District Court that the applicants had requested to have the purchase price reimbursed but that, according to their lawyer, they had not complied with the court judgment to return the house, had continued to pay the annual instalments and, therefore, had not insisted on the settlement of the case, i.e. on the reimbursement of the purchase price. The Ministry assured the court that it was ready to reimburse the amount due to the applicants. 26. On 24 April 2003 a hearing was held by the District Court, and was adjourned until 23 June 2003. 27. On 4 June 2003 the applicants submitted their supplementary observations on the merits of their action for damages. 28. The hearing held on 23 June 2003 was adjourned to 14 July 2003, when the District Court decided that the proceedings concerning the payment of the purchase price, with interest for the delays in payment since 18 January 1999, would be considered separately. It dismissed the remainder of the applicants' claim for damages. 29. On the same day, the Ministry of Finance reimbursed the whole purchase price of CZK 344,846 (EUR 10,878) to the applicants who, on 11 August 2003, withdrew the relevant part of their action for damages. 30. On 18 December 2003 the Regional Court, upon the applicants' appeal of 1 September 2003, upheld the merits of the District Court's judgment. 31. On 22 March 2004 the applicants filed an appeal on points of law (dovolání) in the Supreme Court (Nejvyšší soud). These proceedings are still pending. 32. On 21 June 2004 the District Court, after having held a hearing on 4 June 2004, stayed the proceedings as to the payment of the purchase price. It ordered the Ministry of Finance to pay interest for the delays in payment since 18 January 1999 within three days of the coming into force of the judgment. 33. The defendant lodged an appeal against this judgment. The appellate proceedings are still pending.