CASE OF MISIUKONIS AND OTHERS v. LITHUANIA
Violation of Article 1 of Protocol No. 1 - Protection of property (Article 1 para. 1 of Protocol No. 1 - Peaceful enjoyment of possessions)
András Sajó;Egidijus Kūris;Krzysztof Wojtyczek;Marko Bošnjak;Paulo Pinto De Albuquerque;Vincent A. De Gaetano;Gabriele Kucsko-Stadlmayer
5. The first and second applicants were born in 1940 and 1942 respectively and live in Kaunas. The third applicant was born in 1977 and lives in France. The first and second applicants are husband and wife, and the third applicant is their daughter. 6. On 25 January 2001 the Vilnius County Administration (hereinafter “the VCA”) acknowledged G.O.’s right to restoration of title in respect of 0.728 hectares of land in the Antaviliai estate in the Vilnius Region. That land had belonged to G.O.’s father and had been nationalised by the Soviet regime. 7. The following day G.O. sold his right to restoration of title in respect of that plot of land in equal parts to four buyers: the three applicants and V.M. (the first and second applicants’ son, and the third applicant’s brother). The sale agreement was signed by V.M., acting as the applicants’ representative. The four buyers paid, in equal parts, a total of 15,000 Lithuanian litai (LTL; approximately 4,344 euros (EUR)) to G.O. 8. On 25 June 2001 the VCA issued documents confirming the applicants’ and V.M.’s right to receive 0.182 hectares of land each from the State for free. As the second applicant had been a deportee of the Soviet regime, in line with the domestic law she and her family had priority rights to have their property rights restored. The applicants and V.M. were provided with four plots of land (one plot each) in the city of Vilnius the following month. 9. In August and September 2001 the applicants, represented by V.M., sold their plots to third parties for the price of LTL 25,000 (EUR 7,241) for each plot. The sale agreements indicated that the indexed value of each plot, estimated by the Vilnius Branch of the State Enterprise Registry of Land and Other Immovable Property (Žemės ir kito nekilnojamojo turto kadastro ir registro valstybės įmonės Vilniaus filialas), was LTL 25,650 (EUR 7,429). 10. In October 2001 the Vilnius City Police Department opened a pretrial investigation concerning allegations of fraud in connection with the restoration of property rights in the Vilnius Region. It was suspected that an organised criminal group was forging documents showing deportee status in order to obtain priority rights in the property restoration process. It was also suspected that some officials of regional authorities had unlawfully restored property rights to individuals who did not have such rights. 11. On 26 November 2001 V.M. was interviewed as a witness in the investigation and asked to explain how he and his family (the applicants) had obtained land in Vilnius. V.M. stated that in 1994 he had befriended E.K. who was his wife’s stepbrother. V.M. knew that E.K.’s job was related to land measurement. Sometime in 2000 V.M. mentioned to E.K. that his mother (the second applicant) had been a deportee. Then E.K. told him that it was possible to acquire restoration rights from other persons and get certain privileges available to former deportees. After about six months E.K. informed V.M. that he had found a person who was willing to sell his restoration rights. E.K. advised V.M. that it was better if the contract with that person (G.O.) was signed by four family members and not just one, because that way they could obtain four separate plots of land. E.K. dealt with all the related paperwork and contacted public officials, while V.M. only signed the sale agreements with G.O. After V.M. and his family had received plots of land, E.K. suggested selling them, and found buyers for all the four plots. V.M. submitted that he had not known the buyers previously and had only met them when signing the agreements. He received LTL 25,000 from each buyer. In all their dealings related to the land V.M. and his family trusted E.K. and assumed that he knew all the relevant legal acts, as his work was related to land. Neither V.M. nor the applicants paid any money to E.K. at any point. 12. On 10 January 2002 V.M. was again interviewed as a witness in the investigation. He retracted his previous statement in part and stated that he had not received payment for the four plots of land (LTL 25,000 for each plot) and did not know if the buyers had paid that money to E.K. or to anyone else, or if they had paid anything at all. V.M. also stated that in the autumn of 2001 E.K. had informed him about the pending pre-trial investigation and advised him to tell the authorities, if questioned, that he (V.M.) had received the payment. E.K. had assured V.M. that everything had been done lawfully, but now V.M. considered that he had been misled and deceived by E.K. 13. It appears that none of the applicants were interviewed or had any procedural status in the investigation. 14. On 15 June 2007 the Vilnius City District Prosecutor ruled that “the facts of the case confirmed that suspects A.Ž., G.S. and S.Ž. had acted unlawfully” and that “during the investigation it was indisputably established (neginčytinai nustatyta) that suspect A.Ž. had unlawfully included relatives of friends or acquaintances of hers on the list of those who had priority right to have their property rights restored”. That same ruling discontinued the investigation as time-barred. 15. In January 2002 the prosecutor of the Vilnius Region (hereinafter “the prosecutor”) lodged a claim before the Vilnius City First District Court, asking for the administrative decisions which had acknowledged G.O.’s right to restoration of title, the sale of G.O.’s restoration rights to the applicants (and V.M.), and all the administrative decisions which had allocated land to them, to be overturned. That claim was amended in June and September 2002 and June 2005. The prosecutor submitted that the Law on Restitution, in force at the material time, entitled G.O. to receive one plot of up to 0.2 ha, with the remainder of his land being compensated for in other ways (see “Relevant domestic law” below), so the applicants were not entitled to be allocated a plot of land of that size each. The prosecutor also submitted that the VCA had unlawfully restored the applicants’ rights to property in the order of priority: even though the second applicant had been a deportee, G.O. had not, and thus he did not have the right to transfer to the applicants priority rights which he himself did not have. 16. On 20 February 2006 the Vilnius City First District Court allowed the prosecutor’s claim in part. The court found that the authorities had lawfully decided to restore G.O.’s property rights and that the latter had lawfully sold those rights to the applicants. However, the court upheld the prosecutor’s argument that G.O. did not have the right to sell more rights than he had himself, and that the applicants’ property rights could only have been restored under the same conditions as would have been applied had they been restored to G.O. The court observed that although such a rule had not been explicitly stipulated in the Law on Restoration at the time when G.O. sold his rights to the applicants, that rule stemmed from a systemic and logical interpretation of that Law, as well as from legal acts of lower rank (see paragraphs 32 and 34 below). Accordingly, the court held that the applicants had the right to receive one plot of land of up to 0.2 ha, but not three separate plots of that size, and they were not entitled to restoration in the order of priority. It overturned the administrative decisions which had allocated the land to the applicants. 17. As a result, the Vilnius City First District Court ordered the applicants to return to the State the plots of land which they had received from it for free. Since they had sold the land to third parties and restitution in integrum was not possible, the court decided that they had to pay the State the market value of that land. In line with Article 6.147 § 2 of the Civil Code (see paragraph 38 below), when property subject to restitution is transferred and the person who transferred it has acted in good faith, he or she has to compensate in the amount of the market value of the property at the time when it was received or transferred, or at the time of restitution, whichever is lowest. The court noted that the prosecutor had not alleged that the unlawful transaction had occurred because of the applicants’ fault or that they had acted in bad faith; nor had it been determined, at the time of the proceedings, that any crime had been committed. Accordingly, the court ordered the applicants to return to the State an amount corresponding to the market value of the land at the time they sold it, as that value was the lowest. On the basis of an estimate by the State Enterprise Centre of Registers, each applicant was ordered to pay LTL 216,000 (EUR 62,560). 18. The applicants appealed against that judgment; on 6 June 2006 the Vilnius Regional Court dismissed their appeal. The court considered that obliging the applicants to pay compensation in the amount of the market value of the land was not disproportionate, because they still retained the right to have property rights restored and to obtain new plots. 19. On 5 June 2007 the Supreme Court dismissed a cassation appeal by the applicants. It held that ignorance of the law could not absolve anyone of responsibility, and thus the applicants should have known that property rights had been restored to them in breach of peremptory legal norms, especially as there was information that they had been advised by E.K., who worked in a municipal land reform department (see paragraphs 11-12 above). 20. On 29 June 2007 the applicants submitted a claim against the State for pecuniary damages before the Vilnius Regional Administrative Court. They contended that each of them had received LTL 25,000 for selling the land but had been ordered to pay LTL 216,000 to the State each, and thus had suffered pecuniary losses of LTL 191,000 (EUR 55,317) each. They also asked for pecuniary damages of LTL 5,230 (EUR 1,514) for the court fees each of them had had to pay in the previous proceedings (see paragraphs 15-19 above). 21. After submitting their claim, the applicants applied for suspension of the execution of the Vilnius City First District Court’s judgment of 20 February 2006 (see paragraph 16 above), submitting that they did not have sufficient funds to comply with it. On 7 December 2007 the Vilnius Regional Administrative Court rejected their application on the grounds that the execution of the judgment had not been started yet, and that, in any event, if the applicants did not have sufficient funds nothing would be seized from them. 22. On 13 March 2008 the Vilnius Regional Administrative Court dismissed the applicants’ claim for damages. The court acknowledged that the VCA had acted unlawfully when allocating land to the applicants; however, it considered that the applicants had not proven that they had suffered any pecuniary damage. The court noted that the applicants still had the right to restoration of title to G.O.’s land, because their agreement had not been cancelled, and that they were on the list of candidates to be given new plots of land. Accordingly, until such plots were given to them it was not possible to assess whether the applicants had suffered pecuniary damage or not. 23. The Vilnius Regional Administrative Court also noted that there had been a criminal investigation concerning the VCA’s unlawful decisions restoring property rights. Although the investigation was eventually discontinued, it had nonetheless “indisputably established” that certain employees of the VCA had unlawfully issued documents recognising restoration rights (see paragraph 14 above). The court noted that one of those employees was E.K., whom the applicants had consulted. Accordingly, the court held that the applicants should have known that they had received the land unlawfully and that they had themselves contributed to the pecuniary damage “by acting carelessly and negligently” (veikdami nerūpestingai ir neatsargiai). 24. The applicants appealed against that judgment. They submitted, inter alia, that even if they had contributed to the pecuniary damage, the main agent who had caused those damages had been the VCA. Therefore, they argued that, in line with the provisions of the Civil Code (see paragraphs 39-40 below), the liability should have been distributed proportionately between the VCA and the applicants and not placed solely on them. The applicants also submitted that the fact that V.M. had consulted E.K. did not prove that the applicants had conspired with E.K. or other unlawfully acting officials, or that the applicants had pressured any officials to act unlawfully to their benefit. The applicants contended that after their restoration rights had been cancelled the original state of affairs should have been restored, and they should not have been obliged to pay more than they had received. 25. On 2 March 2009 the Supreme Administrative Court dismissed the applicants’ appeal and upheld the judgment of the lower court. It underlined that the applicants had received the land from the State for free, and that they had immediately sold it to third parties who had to be considered bona fide acquirers. The court held that by selling their plots for a price that was significantly lower than their market value the applicants had acted at their own risk, and thus the difference between what they had received (LTL 25,000 each) and what they were obliged to pay to the State (LTL 216,000 each) could not be regarded as pecuniary damage. The Supreme Administrative Court further held that even if the applicants had suffered pecuniary damage, they could not be awarded damages because they themselves had acted unlawfully. Relying on the Supreme Court’s judgment of 5 June 2007 (see paragraph 19 above), the Supreme Administrative Court considered that the applicants had abused their rights by attempting to get from the State more land than G.O. had been entitled to receive. Accordingly, having concluded that both the applicants and the VCA had acted unlawfully, the court relied on Article 6.282 § 1 of the Civil Code (see paragraph 40 below) and held that there were no grounds to award them pecuniary damages. 26. Subsequently the applicants applied for reopening of the proceedings, but on 31 December 2009 the Supreme Administrative Court dismissed their application. 27. In March 2013 a bailiff began executing the Vilnius City First District Court’s judgment of 20 February 2006 (see paragraph 16 above). According to the documents in the Court’s possession, from that date until June 2015 the first and second applicants each paid LTL 2,445 (EUR 708) in monthly payments ranging from LTL 69 (EUR 20) to LTL 200 (EUR 58). The third applicant paid LTL 3,249 (EUR 941) in monthly payments ranging from LTL 69 (EUR 20) to LTL 300 (EUR 87). At the time of the parties’ observations to the Court, the execution was ongoing. The Government submitted that in the future, when the applicants were provided with new plots of land (see paragraphs 28-30 below), the remaining amount could be recovered from those plots. 28. On 19 July 2007 the VCA included the applicants (and V.M.) on the list of individuals who had the right to have title to property restored in the area around Vilnius. Their number in the list was 1417 B. 29. On 14 March 2016 the applicants (and V.M.) were informed by the National Land Service that they were number 185 in the above-mentioned list. They were invited to a meeting of candidates during which they would be able to choose one plot of land of up to 0.12 hectares in joint ownership. 30. As submitted by the Government, that meeting took place on 5 April 2016 and the first and second applicants, as well as V.M., were present but the third applicant was not. Since the four of them were entitled to receive one plot of land in joint ownership, the first and second applicants (and V.M.) were not allowed to choose a plot in the absence of the third applicant. The Government further submitted that there was still land available in the area around Vilnius and that the applicants would be invited to another meeting, planned to take place in the autumn of 2016. At the time of the parties’ observations to the Court, the applicants’ property rights had not yet been restored.