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THIRD
SECTION
CASE OF STRAISTEANU AND OTHERS v. MOLDOVA
(Application
no. 4834/06)
JUDGMENT
(Just
satisfaction)
STRASBOURG
24
April 2012
This
judgment will become final in the circumstances set out in Article 44
§ 2 of the Convention. It may be subject to editorial
revision.
In the case of Straisteanu and Others v. Moldova,
The
European Court of Human Rights (Third Section), sitting as a Chamber
composed of:
Josep Casadevall,
President,
Corneliu Bîrsan,
Egbert
Myjer,
Ján Šikuta,
Ineta
Ziemele,
Nona Tsotsoria,
Mihai Poalelungi,
judges,
and Marialena
Tsirli, Deputy
Section Registrar,
Having
deliberated in private on 3 April 2012,
Delivers
the following judgment, which was adopted on that date:
PROCEDURE
- The
case originated in an application (no. 4834/06) against the Republic
of Moldova lodged with the Court on 1 February 2006 under Article 34
of the Convention for the Protection of Human Rights and Fundamental
Freedoms (“the Convention”) by three Moldovan nationals,
Mr Gheorghe Straisteanu, Ms Natalia Straisteanu and Ms Daniela
Straisteanu, and Codrana-Lux, a company from Moldova.
- In
a judgment delivered on 7 April 2009 (“the principal
judgment”), the Court held in respect of the first applicant
that there has been a breach of Article 3 taken alone and in
conjunction with Article 13 of the Convention in view of the poor
conditions of his detention. The Court also held that the first
applicant’s detention was in breach of Article 5 §§ 1
and 3 of the Convention and awarded him non-pecuniary compensation of
10,000 euros (EUR) in respect of the above breaches.
The
Court also found a breach of Article 6 § 1 and Article 1 of
Protocol No. 1 to the Convention in respect of all the
applicants, on account of the upholding by the domestic courts, in
breach of the principle of legal certainty, of the Prosecutor
General’s actions for the revocation of a contract of sale of
14.63 hectares of land and of a contract of lease of a lake measuring
5.63 hectares.
- Since
the question of the application of Article 41 of the Convention in
respect of the latter violations (Article 6 § 1 and Article 1 of
Protocol No. 1 to the Convention) was not ready for
decision, the Court reserved it and invited the Government and the
applicants to submit, within three months of the date on which the
judgment became final in accordance with Article 44 § 2 of
the Convention, their written observations on that issue and, in
particular, to notify the Court of any agreement they might reach.
- The
applicants and the Government each submitted observations.
THE LAW
- Article 41 of the Convention provides:
“If the Court finds that there has been a
violation of the Convention or the Protocols thereto, and if the
internal law of the High Contracting Party concerned allows only
partial reparation to be made, the Court shall, if necessary, afford
just satisfaction to the injured party.”
A. Damage
1. The applicants’ submissions
- The
first applicant claimed EUR 68,097.65 for pecuniary damage caused as
a result of the annulment of the contracts of sale and lease of 2001.
According to him he borrowed from a person named G.A. sums of money
to cover court fees, experts’ fees, and transportation and
storage of private belongings after the applicants’ eviction
from their property. According to the conditions of the loan the
interest rates varied between 10% and 18% and the loans were made in
Moldovan lei, euros and United States dollars. Some of the amount
claimed by the applicant represented compensation for inflation.
- The
second applicant claimed EUR 186,680.4 in compensation for pecuniary
damage caused as a result of the revocation of the contract of sale
of 14.63 hectares of land. She submitted that a part of that land
measuring 1.2544 hectares belonged to her and that its value was
approximately EUR 100,000. The applicant submitted documents
which indicated that the plot of land in question, destined for
agricultural use, was bought by the fourth applicant, the company, in
May 2001, from the local council and sold to the second applicant two
months later. According to the applicant the value of the buildings
built on the land after its acquisition was approximately EUR 85,000.
The rest of the amount claimed by this applicant represented the
expert’s fee and compensation for inflation. The applicant
submitted an expert report in support of her claims. She also claimed
EUR 100,000 in compensation for non-pecuniary damage and argued that
she had suffered severe distress and frustration after losing her
property.
- The
third applicant claimed EUR 4,431,168 for pecuniary damage caused as
a result of the annulment of the contract of sale of 14.63 hectares
of land. She submitted that a part of that land measuring 11.7261
hectares belonged to her and that its value was EUR 1,829,423. The
applicant submitted documents according to which the plot of land in
question, destined for agricultural use, was bought by the fourth
applicant, the company, in May 2001 from the local council and sold
to the first applicant in March 2004 and then to the third applicant
in April 2004. The third applicant also submitted that the price of
the buildings built on the land after its acquisition was EUR
1,105,119. The applicant further submitted that she had spent 36,000
Moldovan lei (MDL)
on two valuations of the property and that in 2004 she had taken out
a loan of MDL 140,000 to build a bar and terrace on the land to make
it a tourist destination. She mortgaged the land to guarantee the
loan. After the 2001 contract of sale of the land was wrongfully
revoked she could no longer repay the loan, and she still owes MDL
105,064 to the credit institution. The applicant also submitted that
she had suffered a loss of income of MDL 14,634,000, an amount which
could have been earned by her if she had been able to use the
property as a tourist destination between 2006 and 2011. The
applicant further submitted that she had spent MDL 20,900 in court
fees when attempting to claim compensation in the domestic courts,
which have not been reimbursed to her. Lastly, she claimed MDL
14,795,964 to cover losses suffered due to inflation. The applicant
submitted an expert report in support of her claims. According to the
report the value of the land in question depends on whether it is
public or private property. Had the land been public property its
value would have been MDL 68,750, whereas if it had been private
property its value would have been MDL 29,986,700. The third
applicant also claimed EUR 80,000 in compensation for non-pecuniary
damage.
- The
fourth applicant, the company which had in its possession a lake
measuring 5.63 hectares of land rented from the local council in
2001, claimed EUR 1,183,726 in compensation for pecuniary damage. It
claimed that the value of the property was EUR 444,000. The applicant
company further submitted that it had spent some MDL 7,000 on two
valuations of the property. The applicant company also submitted that
it had suffered a loss of income of some MDL 6,406,681, an amount
which could have been earned by it by using the property for tourism
between 2006 and 2011. The applicant company lastly claimed MDL
2,969,354 to cover losses suffered due to inflation.
- The
applicants stressed that they had a right to build on the land, and
referred to a decision of the local council of 2 July 1999 in which
the local authorities decided to sell the land with a view to a
tourist resort being built on it. The applicants made it clear that
they did not want the property back, because substantial damage had
been done to it since 2006 and because it had other owners. Moreover,
the hostile attitude of the local administration towards them would
make it impossible for them to obtain permits and licences to
continue running their business. The applicants finally requested
that damages be awarded in euros and not in the Moldovan national
currency.
2. The Government’s submissions
- The
Government disagreed with the amounts claimed by the applicants and
expressed doubt in respect of the claims made by the first applicant.
They argued in the first place that in the initial just satisfaction
observations under Article 41 made by the applicants in June 2008 no
claim was made by the first applicant corresponding to the one made
in their observations of July 2009. Moreover, the money borrowed by
the first applicant was to be spent, inter alia, on valuation,
transportation and storage of the possessions of the other
applicants. Accordingly, there was no causal link between the breach
of Article 6 and Article 1 of Protocol No. 1 found in respect of the
first applicant and any possible damage suffered by him in relation
with these loans. The Government also submitted that the first
applicant’s calculations were wrong, because he had used an
incorrect exchange rate.
- In
respect of the other applicants the Government expressed doubt about
the reliability of the expert reports presented by them and pointed
to the fact that the expert had made a note to the effect that the
reports have been drawn up solely on the basis of material submitted
by the applicants. The Government submitted that the land belonging
to the second and third applicants was only permitted to be used for
agricultural purposes and nothing could be built on it unless its
designation was changed and a number of planning permissions and
authorisations obtained. Since none of the above was done by the
applicants, all the construction on the land was unlawful. The
Government drew the Court’s attention to Article 157 of the
Criminal Code in force at the time of the events, according to which
building without the legally required permits was a criminal offence
punishable by a fine. They also cited Article 149 of the Code of
Administrative Offences, under which building without the legally
required permits was punishable by a fine and by demolition of the
unlawful buildings. Moreover, for the applicants to conduct a
business activity such as running restaurants, bars and hotels
required licences granted by the State which the applicants did not
possess and had not even applied for.
- The
Government further contested the claims made by the fourth applicant,
the company, and submitted that it could not claim the value of the
lake, because the lake was not owned by it but merely rented from the
local administration.
- The
Government finally expressed the view that the second and third
applicants could only claim the value of the land owned by them,
estimated at MDL 51,000. However, even that was not certain, since
they had not paid the full price for the land. The price of the land
was to be paid in instalments over a period of ten years and the
local council had received only some MDL 15,000. The Government also
submitted that the applicants had been in dispute with the local
authorities because they had wrongfully occupied an area of forest
measuring 0.7 hectares and a public road measuring 0.35 hectares.
- As
far as the applicants’ claims for non-pecuniary damage are
concerned, the Government submitted that they were excessive and
without foundation. The Government made reference to several
judgments in respect of Moldova in which the Court found similar
breaches of the Convention and awarded EUR 2,000 for non-pecuniary
damage.
3. The Court’s assessment
(a) Pecuniary damage
- The
Court notes that the applicants’ pecuniary claims could be
divided into several major groups: the value of the land, the value
of the buildings on the land, the lost profit, and other expenses
incurred by the applicants when they were deprived of their property
(loans, court fees, expenses for valuation and inflation). The Court
will examine separately the claims concerning each of the above
groups.
- As
far as the value of the buildings on the land is concerned, the Court
notes with the Government that the land owned by the second and third
applicants is agricultural land and that its designation has never
been changed. The applicants submit that they had the right to
develop the land for tourism by virtue of a decision of the local
administration of July 1999. However, in the eyes of the Court, that
decision did no more than state the reason for which the land was
sold, without waiving any of the applicants’ legal obligations
to obtain a change in the designation of the land and to comply with
all the building regulations. Since it does not appear from the
applicants’ submissions that they have complied with those
requirements, the Court has doubts as to whether the buildings in
question were built lawfully. The Court further notes that under the
relevant domestic law unlawful building is a criminal offence and any
building built in breach of planning regulations is subject to
demolition. The Court sees no reason to believe that the applicants
were not aware at all times that the development of the land was
precarious. In those circumstances the Court does not consider that
there is a causal connection between the breaches found in the
principal judgment and the applicants’ claims concerning the
value of the buildings built on the agricultural land of which they
have been deprived. Accordingly, this part of the applicants’
claim is to be dismissed. For the same reason, the Court is not in a
position to award compensation to the third applicant for a loan
contracted by her with a view to building a bar and a restaurant on
the property.
- As
to the lost profit claimed by the second, third and fourth
applicants, the Court notes that the claimed pecuniary loss does not
derive from an activity that has come into existence, namely from the
applicants’ activity prior to the deprivation, but from plans
that never went further than anticipation. As has been shown above,
the applicants had not acquired the right to develop the property by
building on it, or to exploit it in the sense desired by them.
Indeed, it does not appear from the applicants’ submissions or
from any documents submitted by them that they had any licences to
practise activities such as running restaurants, bars and hotels or
making profits in any other way by using their property as a tourist
destination. Nor did the applicants show that they had made any
attempts to obtain such permits from the State. The Court considers
that there is a great degree of conjecture in any attempt to predict
how long it would have taken for the applicants to obtain such
licences, even assuming that they could have regularised the problem
with the buildings, and whether they would have been able to obtain
them at all, especially as the applicants themselves admitted that
their relationship with the local administration was very tense. In
such circumstances, the Court is not convinced that the applicants’
anticipated income has attained sufficient attributes to be
considered a legally protected interest of sufficient certainty as to
be liable for compensation. Therefore, this part of the applicants’
claim is also to be dismissed.
- As
to the claim concerning the value of the land, the Court notes from
the outset that the applicants included in that claim the value of
the lake rented by the fourth applicant from the local
administration. The Court agrees with the Government that since the
fourth applicant was not the owner of that lake, it could not claim
its value.
As to
the land which was owned by the second and the third applicants, the
Court considers that they are entitled to be reimbursed its value in
spite of the fact that they did not pay its entire price. In that
respect, the Court sees no reasons to believe that the applicants
would not have paid the remaining instalments had the land not been
wrongfully taken away from them, moreover since the price owed by
them appears to have been a nominal fee. That being said, the Court
is not prepared to accept the applicants’ submission that the
value of the land was EUR 1,929,423. In view of the findings made in
paragraph 17 above and of the information in its possession
concerning the price of agricultural land in Moldova, the Court,
ruling on an equitable basis as required by Article 41 of the
Convention, awards EUR 2,000 for the pecuniary damage sustained
by the second applicant and EUR 19,000 for the pecuniary damage
sustained by the third applicant.
- The
Court is similarly unable to accept the claims made by the applicants
in respect of other expenses incurred by them. In particular, the
expenses allegedly incurred by the applicants for the valuation of
the property must be rejected as they are speculative and
unrealistic. Indeed, the Court was unable to decide on the issue of
just satisfaction at the same time as the merits of the case. Neither
could it rely on the valuations in the present judgment.
The
Court is similarly not prepared to accept the applicants’
claims concerning the money spent by them on court fees in their
unsuccessful attempts to claim compensation from the domestic courts.
The applicants did not adduce any evidence that their request for
reimbursement of those fees had been rejected.
Nor
is the Court prepared to accept the claims made by the first
applicant in respect of loans allegedly taken by him from a third
party for the purpose of transportation of property from the land of
which the applicants had been deprived, because it was not presented
with any evidence as to how the money was spent. The Court also
dismisses the applicants’ claim related to inflation, as it is
not applicable in the circumstances of the present case.
- In
conclusion the Court decides to award EUR 2,000 to the second
applicant and EUR 19,000 to the third applicant and to dismiss the
remainder of the claims.
(b) Non-pecuniary damage
- The
Court recalls that only the second and the third applicants made
claims under this head. Ruling on an equitable basis it awards each
of them EUR 3,000 in compensation for the non-pecuniary damage
suffered.
B. Default interest
- The
Court considers it appropriate that the default interest rate should
be based on the marginal lending rate of the European Central Bank,
to which should be added three percentage points.
FOR THESE REASONS, THE COURT UNANIMOUSLY
- Holds
(a) that
the respondent State is to pay, within three months of the date on
which the judgment becomes final in accordance with Article 44 § 2
of the Convention the following amounts, to be converted into
Moldovan lei at the rate applicable at the date of settlement:
(i) EUR
2,000 (two thousand euros), plus any tax that may be chargeable, to
the second applicant in respect of pecuniary damage;
(ii) EUR
3,000 (three thousand euros), plus any tax that may be chargeable, to
the second applicant, in respect of non-pecuniary damage;
(iii) EUR
19,000 (nineteen thousand euros), plus any tax that may be
chargeable, to the third applicant, in respect of pecuniary damage;
(iv) EUR
3,000 (three thousand euros), plus any tax that may be chargeable, to
the third applicant, in respect of non-pecuniary damage;
(b) that
from the expiry of the above-mentioned three months until settlement
simple interest shall be payable on the above amounts at a rate equal
to the marginal lending rate of the European Central Bank during the
default period plus three percentage points;
- Dismisses the remainder of the applicants’
claim for just satisfaction.
Done in English, and notified in writing on 24 April 2012, pursuant
to Rule 77 §§ 2 and 3 of the Rules of Court.
Marialena Tsirli Josep Casadevall Deputy Registrar President
