CASE OF AKKUŞ v. TURKEY
Violation of P1-1;Preliminary objection rejected;Pecuniary damage - financial award;Non-pecuniary damage - financial award;Costs and expenses partial award - domestic proceedings;Costs and expenses partial award - Convention proceedings
Paul Mahoney
6. In September-October 1987, the National Water Board (Devlet Su isleri), a State body responsible for dam construction, expropriated land belonging to Mrs Akkus and her husband, who died in 1992, in order to build the Altinkaya hydro-electric dam in the Kizilirmak Valley. The land, which was located in the village of Gökdogan (Sinop) had been used for growing rice. It now lies under water. More than 3,000 families (17,000 people in all) were affected by the expropriations resulting from the dam construction scheme. 7. According to the applicant, a scientific study commissioned by the National Water Board and carried out by the Aegean Faculty of Agronomy found the land to be worth between 3,200 and 3,500 Turkish liras (TRL) per square metre whereas the amount paid in 1987 was between TRL 800 and 850. 8. A committee of experts of the National Water Board assessed the value of the applicant’s land at TRL 122,000. That amount was paid to her when the expropriation took place. 9. On 12 October 1987 the applicant lodged an application with the Duragan Court of First Instance for increased compensation and requested that the rate of inflation be taken into account when determining the additional loss. On 22 June 1989 the court awarded her additional compensation of TRL 271,039 and simple default interest at the rate of 30% per annum from 4 September 1987, the date of the expropriation. The total compensation thus came to TRL 393,039. She was also awarded TRL 61,123 for legal costs. 10. The Board appealed to the Court of Cassation on points of law. Mrs Akkus filed a cross-appeal based on Article 105 of the Code of Obligations (see paragraph 14 below), in which she sought a ruling that the basis for calculating the additional loss should be the rate of inflation and not the rate of statutory interest for delay. On 17 September 1990 the Court of Cassation upheld the judgment at first instance. 11. The additional compensation was paid in February 1992, that is to say six months after the application was lodged with the European Commission of Human Rights and approximately seventeen months after the Court of Cassation’s decision. 12. Mrs Akkus now lives with her son-in-law, who provides for her needs. 13. By Law no. 3095 of 4 December 1984 the rate of interest on overdue State debts is 30% per annum. At the material time the average rate of inflation was 70% per annum and the rate of interest for delay payable on debts owed to the State was 7% per month (84% per annum) (section 51 of Law no. 6183 on the Collection of Debts due to the State and Cabinet Ordinance no. 89/14915). 14. Article 105 of the Code of Obligations provides: "Where the loss sustained by the creditor exceeds the interest for late payment and the debtor is unable to show that the creditor has been at fault, it is for the debtor to make good the loss. If the additional loss can be assessed immediately the court may determine the amount when giving its decision on the merits." 15. On 3 June 1991 the Fifth Civil Division of the Court of Cassation, which has jurisdiction in cases concerning compensation for expropriation, ruled as follows: "The way in which creditors are compensated for the late payment of debt is through statutory interest. Since creditors are able, when resorting to enforcement measures, to claim the amount due to them plus interest, they are not entitled to claim any other form of compensation; accordingly, the decision to grant the creditor’s claim, on the basis that the rate of inflation was high, was ill-founded..." 16. On 23 February 1994 (judgment E: 1993/5-600, K: 1994/80) the Court of Cassation, sitting as a full court, ruled as follows: "Law no. 3095 was approved and came into force when inflation in the country was high with rates well over 30%. Notwithstanding that fact, the legislature fixed the rate of interest for delay at 30%. In the present case it would therefore be unlawful to award compound interest at a rate exceeding 30% on the erroneous basis that the rate of interest payable on bank deposits was applicable."