ROGOZINSKI AND OTHERS v. POLAND
Inadmissible
David Thór Björgvinsson;Giovanni Bonello;Lech Garlicki;Ledi Bianku;Mihai Poalelungi;Nicolas Bratza
The applicants, Mr Henryk Rogoziński, Mr Marek Bartkowski and Mr Andrzej Kulecki are Polish nationals who were born in 1950, 1948 and 1946 respectively and live in Gietrzwałd. They were represented before the Court by Mr L. Obara, a lawyer practising in Olsztyn. The Polish Government (“the Government”) were represented by their Agent, Mr J. Wołąsiewicz. In 1992 the applicants agreed with the local branch of the State-run electricity supply company (“the company”) that they would finance and build on their land an electricity installation connecting their properties to the general electricity network operated by that company (high voltage transformer and cables). They had such an installation built and financed it from their own resources, paying PLZ 270,000,000 in pre-denomination currency – the equivalent of PLN 27,000 (approximately EUR 6,800 today). In 1993, when the installation was ready, a disagreement arose between the applicants and the electricity supply company as to the reimbursement of the costs the applicants had incurred. The company refused to reimburse the costs. As a result, the installation became operational and the company took it over, connected it to the electricity network and started normal exploitation. In October 1993 the applicants refused to sign documents confirming that ownership of the high-voltage transformer, the essential part of the installation, had been taken over by the company ex lege. They only signed documents confirming the transfer of ownership of the cables to the company. In the same month they submitted a letter to the company informing it that they refused to acknowledge the transfer of ownership. In the following years, from 1995 at the earliest, the company connected 24 new electricity users to the network built by the applicants (after the applicants had sold their land to these persons on unspecified dates), charged each of them for this service and for a part of the costs borne in connection with building the installation and operated the service normally, providing electricity to them at normal prices, using the installation built by the applicants. The applicants apparently repeatedly tried to obtain reimbursement of the costs they had incurred in the amount of PLN 112,000, but received oral refusals. In August 2000 the applicants requested the company in writing to reimburse the costs of the construction they had borne in 1992-1993 as well as the amounts the company had charged the 24 users for connecting them to the network. They claimed PLN 112,000 (approximately EUR 27,300 today). The company refused, stating that ownership of the network had been transferred to it in October 1993. In a letter of 6 September 2001 the Ombudsman, in reply to the applicants’ request to intervene in their case, informed them that their case was of a civil-law character and could, as such, be pursued before the civil courts. The Ombudsman also summarised a judgment of the Constitutional Court of 1991 (see Relevant domestic law below) and emphasised that after this judgment had been given, the Anti-Monopoly Court had repeatedly stated in its judgments that the practice of the State-run electricity supply company amounted to an abuse of a dominant market position. The applicants were also informed that there had been judgments of the Supreme Court to the effect that in cases in which contracts concluded as a result of an abuse of a dominant market position were declared null and void, wronged consumers could claim unjust enrichment under the provisions of the Civil Code on liability in tort. In November 2001 the applicants lodged an action against the company with the Olsztyn District Court. They sought payment of PLN 1,000 (EUR 250), seeking a judgment on the principle of their claim, and argued that they had never given their agreement to the company taking over ownership and using the installation which they had built and financed themselves. On 20 February 2003 the court dismissed the claim. It established that the applicants had built the installation and financed the building works from their own resources on the basis of technical documentation given to them by the electricity supply company. Upon completion of the installation they had refused to sign a document confirming the transfer of ownership of the main part of the installation to the company. The court further noted that at the relevant time, the 1984 Energy Act had been in force. The principles governing the settlement of any accounts between the State-run electricity supply company and landowners who had financed the construction of installations necessary to connect their properties to the electricity network were provided for in a 1964 Ordinance. Article 18 of this Ordinance provided that all electricity installations were the property of the State. Consequently, this Ordinance allowed for all the costs arising from the construction of electricity installations to be borne by individual owners, without any corresponding obligation on the part of the electricity company to reimburse them. Hence, the applicants were to bear these costs. At the time of the construction they had been aware of this as the position of the company had been set out in technical documents which they had received from the company. The applicants appealed, submitting that the defendant company had enriched itself at their expense since it had acquired ownership of the installation and had been exploiting it without having to compensate them in return. The appellate court upheld the judgment by a decision of 25 September 2003. It observed that the first-instance court had correctly found that the applicants had been aware that under the 1964 Ordinance the connection of the installation to the electricity network had depended on the transfer of ownership of the installation to the company. However, the lower court had erred in law in that it had overlooked a judgment of the Constitutional Court given in 1991. In that judgment that court had observed that the 1964 Ordinance could no longer be applied after the 1984 Energy Act had entered into force, because it had been passed ultra vires on the basis of the 1962 Energy Act. Hence, the 1964 Ordinance could not constitute the legal basis for the automatic transfer of ownership of the electricity installation to the electricity company. The Constitutional Court had indicated that the provisions of the Civil Code should apply to such a situation. In that connection, the Regional Court observed that under Article 49 of the Civil Code, electricity supply facilities did not constitute parts of land or a building if they were a part of an enterprise, including an electricity supply enterprise. Hence, such installations were not to be considered part of the applicants’ property and were to become the property of the defendant company. On the other hand, the provisions of the Civil Code on the obligation of an owner of property to reimburse expenditure incurred by a person in possession in order to improve the condition of this property or increase its value were not applicable to the applicants’ situation. This was because at the time when the applicants had borne the expenditure for the construction of the electricity installation, they had been the owners of the properties concerned. Hence, they were not users within the meaning of the relevant provisions of the Civil Code: they had incurred expenditure on their own property, not somebody else’s and, consequently, had no claim to reimbursement. The court finally observed that the applicants had known, when they incurred the expenditure for the construction of the electricity supply installation in 1993, that under the laws applicable at that time ownership of the installation would eventually be transferred to the electricity supply company. Hence, the company could not be said to have obtained unjust enrichment at the expense of the applicants. Further, it was the company which was obliged to operate and maintain these installations. Accordingly, it was fair that the company should take over their ownership. On 18 October 1997 the 1997 Constitution entered into force. Article 64 introduced the legal protection of private ownership. It reads: “1. Everyone shall have the right to ownership, other property rights and the right of succession. 2. Everyone, on an equal basis, shall receive legal protection regarding ownership, other property rights and the right of succession. 3. The right of ownership may only be limited by means of a statute and only to the extent that it does not violate the substance of such right.” Under Article 76 of the Constitution, public authorities shall protect consumers, customers, lessors or lessees against activities threatening their health, privacy and safety, as well as against dishonest market practices. The scope of such protection shall be specified by statute. In 1991 the Ombudsman requested the Constitutional Court to issue a binding interpretation of section 45 of the 1962 Energy Act in so far as it empowered the Council of Ministers to issue ordinances concerning the technical conditions on which individually built and financed electricity supply installations could be connected to the general electricity supply network. At that time, the Constitution adopted in 1952 was in force. In a resolution of 4 December 1991 (W 4/91) the Constitutional Court observed that the 1964 Ordinance, including Article 18 passed on the basis of the 1962 Energy Act, could no longer be applied after the 1984 Energy Act had entered into force. It further noted that in any event the ordinance had been passed ultra vires on the basis of the 1962 Energy Act. The court observed further that relations between the electricity supply company and owners of property were to be considered in the light of the Civil Code. As to the ownership of electricity supply installations situated on individual properties, Article 49 of the Civil Code made it clear that they did not constitute a part of such properties if they were a part of an enterprise, including an electricity supply enterprise. Hence, such installations were to become the property of that enterprise. Further, the provisions of the Civil Code on the obligation of an owner of property to reimburse expenditure incurred by a person in possession in order to improve the condition of this property or increase its value were not applicable to the situation of owners who had financed the construction of electricity supply installations. This was so because at the time of the financing and construction of such installations the owners were constructing them on their own properties. Hence, they could not have recourse to claims normally available to persons in possession against owners. Lastly, the court considered that the civil-law provisions on unjust enrichment could not be applied to the settlement of accounts between the owners and the electricity supply company. Owners who built and financed electricity supply installations on their properties knew and accepted in advance that after these installations were connected to the general electricity network they were to become the property of the company. The court was of the view that such an automatic transfer of ownership to the electricity supply company could not be said to run counter to “principles of community life” within the meaning of Article 5 of the Civil Code. This was because the connection of the installations to the electricity supply network was in the interest of owners. Moreover, after the electricity supply company had become the owner of the installations, it was obliged to operate them and to maintain them in proper technical condition; hence the fact that it had taken them over without being obliged to make any reimbursement was compatible with these principles. In a number of judgments given after 1991 the Supreme Court followed the reasoning based on the judgment of the Constitutional Court and dismissed claims for reimbursement of costs borne by owners to finance electricity supply installations, holding that upon their connection to the network the installation had become the property of the electricity supply company (I CRN 72/93, 23 June 1993, I CKN 608/99, 20 September 2000; resolution III CZP 169/94, 13 January 1995). However, in a judgment of 7 November 1997 (II CKN 424/97) the Supreme Court held that if the recipient of the electricity had financed elements of the installation necessary for the property to be connected to the network, he or she was entitled, on the basis of the provisions of civil law on unjust enrichment, to seek from the electricity company a reimbursement of the costs incurred. Subsequently, in judgments given in 2003 and 2004, the Supreme Court held that Article 49 of the Civil Code could not be interpreted to mean that the physical connection of such an installation, financed by a private party, to the electricity supply network automatically entailed a transfer of ownership of that installation to the electricity company (II CK 40/02, 26 February 2003; II CK 125/03, 10 October 2003; III SK 39/04, 13 May 2004; IV CZP 347/04, 3 December 2004). On 8 March 2006 the Supreme Court gave a resolution (III CZP 105/05) purporting to clarify the discrepancies which had arisen in the case-law concerning the relationship between the electricity supply company and owners who had financed electricity supply installations situated on their land. It reiterated the history of the relevant case-law and observed that a transfer of ownership could only originate in legal events, not in factual ones. It observed that the only function of Article 49 of the Civil Code was to establish the limits of operation of the principle superficies solo cedit, not to determine the financial relationship between the owner of the installation and the owner of the electricity network. Hence, the mere fact that an installation was connected to the network operated by the electricity supply company was not, of itself, sufficient to conclude that a transfer of ownership to the company automatically followed. The issue of ownership and of any settlement of accounts between the company and individual owners should be determined by contract, specifically addressing related issues. In 1997 the 1984 Energy Act was repealed and replaced by a new Energy Act. No provisions producing the same effect as Article 18 of the 1964 Ordinance are currently in force. The question of ownership of electricity supply installations and of the settlement of accounts arising out of the building and financing by private parties of electricity supply installations is now left to the parties, to be freely negotiated between the owners and the State-run electricity supply company. Article 49 of the Civil Code provides that water, electricity, power and similar installations do not constitute a part of land or buildings if they are a part of an enterprise. Article 113 § 1 of the Code of Civil Procedure provides that a party to the proceedings may ask the court competent to deal with the case to grant him or her an exemption from court fees provided that he submits a declaration to the effect that the fees required would entail a substantial reduction in his and his family’s standard of living.