TODOROVI v. BULGARIA
Inadmissible
Karel Jungwiert;Mark Villiger;Mirjana Lazarova Trajkovska;Peer Lorenzen;Rait Maruste;Renate Jaeger;Zdravka Kalaydjieva
The applicants, Todor Ivanov Todorov and Petranka Ruseva Todorova, are Bulgarian nationals who were born in 1944 and 1948 respectively and live in Varna. They are represented before the Court by Mr M. Ekimdjiev and Mrs K. Boncheva, lawyers practising in Plovdiv. The applicants are spouses. In 1986 they bought from the Varna municipality a State-owned apartment, which had been managed by the company C. On 7 January 1991 the applicants bought from the municipality an attic room in the same building for 4,034 old Bulgarian levs (“BGL”). Apparently, following the legal reforms of the 1990s (see below, Relevant background facts, domestic law and practice), the company C. considered that it had become the owner of the attic room and on an unspecified date it granted the tenancy of the room to Mr and Mrs P. In 1997 the applicants brought a rei vindicatio action against Mr and Mrs P. claiming the possession of the room. In a judgment of 25 June 1998 the Varna District Court dismissed the claim. On 9 August 1999 the Varna Regional Court upheld the lower court’s judgment. It found, inter alia, that the sale contract of 7 January 1991 was null and void ab initio as it had not been signed by the mayor, as required by law, but by another official of the municipality. The applicants, thus, had not shown that they were the owners of the attic room. In the meanwhile, on 30 April 1999 the company C. sold the attic room to Mr and Mrs P. On 27 February 2001 the applicants brought an action against C. seeking back the price they had paid for the attic room in 1991, updated in accordance with the inflation indexes. On 4 April 2002 the Varna Regional Court dismissed the claim finding that the 7 January 1991 sale contract had been found to be null and void in proceedings, which had not involved the company C.; it was not therefore bound by this founding of nullity. Upon appeal by the applicants, on 16 January 2003 the Varna Court of Appeal reversed the judgment and held that the applicants were in principle entitled to recovery of the sum. It awarded them the amount they had paid for the attic in 1991, the equivalent of BGL 4,034. However, as a result of inflation and the depreciation of the Bulgarian currency after 1991, the sum amounted to approximately EUR 2. In a final judgment of 18 March 2004 the Supreme Court of Cassation dismissed the applicants’ claim. It found that the action had been time-barred as the five-year time limit for seeking the recovery of what had been paid under a void contract started running from the day of payment, which in this case had been in 1991. By section 55 (1) of the Obligations and Contracts Act, everyone who has paid a sum of money on a non-existent ground is entitled to seek its recovery. In a binding interpretative decision of 1979 the Supreme Court of Bulgaria (now Supreme Court of Cassation) held that the time-limit to bring such an action started running from the moment of payment (Interpretive Decision No. 1 of the Plenary of the Supreme Court of 28 May 1979, case No. 1/79). In accordance with the Bulgarian courts’ established practice revalorisation of claims to reflect inflation and currency depreciation is not possible. Until the beginning of the 1990s, all commercial assets were the property of the State and were only allocated to State enterprises for “use and management”. After the beginning of democratisation and economic change and the ensuing transformation of these enterprises into State-owned limited liability or joint stock companies, the transformed companies acquired ownership of real estate or other assets they had used and managed (see, for more detail, the Court’s description of this transformation in the case of Credit Bank and Others v. Bulgaria (no. 40064/98, ECHR 30 April 2002)).