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FOURTH
SECTION
CASE OF
LAKIĆEVIĆ AND OTHERS
v. MONTENEGRO AND SERBIA
(Applications
nos. 27458/06, 37205/06, 37207/06 and 33604/07)
JUDGMENT
STRASBOURG
13
December 2011
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 Lakićević
and others v. Montenegro and Serbia,
The
European Court of Human Rights (Fourth Section), sitting as a Chamber
composed of:
Lech Garlicki, President,
David
Thór Björgvinsson,
Päivi Hirvelä,
George
Nicolaou,
Zdravka Kalaydjieva,
Nebojša
Vučinić,
Vincent A. De Gaetano, judges,
and
Fatoş Aracı,
Deputy Section
Registrar,
Having
deliberated in private on 22 November 2011,
Delivers
the following judgment, which was adopted on that date:
PROCEDURE
- The
case originated in four separate applications (nos.
27458/06, 37205/06, 37207/06 and 33604/07) lodged with the
Court against both Montenegro and Serbia (the
first and the third applicants) and against Montenegro alone (the
second and the fourth applicants) under Article 34
of the Convention for the Protection of Human Rights and Fundamental
Freedoms (“the Convention”) by four
Montenegrin nationals, Ms Nevenka Lakićević (the first
applicant), Mr Borislav Vukašinović (the second
applicant), Mr Veselin Budeč (the third applicant) and Mr Vlado
Rajković (the fourth applicant) on 5 June 2006, 2 August 2006,
24 July 2006 and 24 July 2007 respectively.
- The first, third and fourth applicants were,
exceptionally, granted leave to represent themselves (Rule 36 §
2 of the Rules of Court). The second applicant was represented by Mr
V. Đurišić, a lawyer practising in Podgorica. The
Montenegrin Government (“the Government”) were
represented by their Agent, Mr Z. PaZin.
3. The
applicants complained under Article 6 of the Convention and Article 1
of Protocol No.1 about the suspension of their pensions.
- On
19 April 2010 the President of the Fourth Section
decided to give notice of the applications to the Government.
It was also decided to rule on the admissibility and merits of the
applications at the same time (Article 29 § 1).
THE FACTS
I. THE CIRCUMSTANCES OF THE CASE
- The
applicants - Ms Nevenka Lakićević (the first applicant),
Mr Borislav Vukašinović (the second applicant), Mr
Veselin Budeč (the third applicant), and Mr Vlado Rajković
(the fourth applicant) - are all Montenegrin nationals who were born
in 1947, 1937, 1924, and 1944 respectively. They live in Herceg-Novi
(the first and third applicants) and Podgorica (the second and fourth
applicants).
- The
facts of the case, as submitted by the parties, may be summarised as
follows.
A. Suspension of pensions
- Between
November 1989 and June 2002 the applicants closed their private law
firms and submitted papers to begin their retirements.
- Between
August 1990 and September 2002 their old-age and disability pension
entitlements, as well as the exact amount of their pensions (starosna
i invalidska penzija), were established by decisions of the
Pension and Disability Insurance Fund (Republički fond
penzijskog i invalidskog osiguranja; hereinafter “the
Pension Fund”). The decisions, as submitted by
the second and fourth applicants, allowed the applicants to
resume working on a part-time basis.
- Between
April 1996 and June 2002 the applicants reopened their own legal
practices on a part-time basis.
- On
1 April 2004, 20 July 2005, 3 June 2005 and 24 November 2005 the
Pension Fund suspended (obustavlja) payment of the applicants’
pensions respectively, until such time as they ceased professional
activity. These decisions were all “deemed to be applicable as
of 1 January 2004”, which was when section 112 of the Pension
and Disability Insurance Act 2003 (hereinafter “the Pension Act
2003”) entered into force (see paragraphs 23 and 25 below).
- The
Pension Fund’s rulings were subsequently upheld by the Ministry
of Labour and Social Welfare (Ministarstvo rada i socijalnog
staranja), as well as, ultimately, by the Administrative Court
(Upravni sud) on 6 December 2005, 4 April 2006, 18 April 2006
and 7 February 2007 in respect of the first, second, third and fourth
applicants respectively. The Administrative Court explained, inter
alia, that the applicants had not been deprived of their pension
entitlements as such, but that the payment of their pensions had
instead been suspended on the basis of the relevant domestic
legislation.
- Finally,
on 13 June 2006, 27 June 2006 and 28 May 2007 respectively, the
Supreme Court (Vrhovni sud) in Podgorica dismissed the second,
third and fourth applicants’ requests for judicial review of
their cases (zahtjev za vanredno preispitivanje sudske odluke).
In so doing, the Supreme Court essentially endorsed the reasons given
by the Administrative Court.
- The
first applicant did not attempt to make use of the judicial review
avenue, in view of the fact that the other applicants’
identical requests had already been rejected by the Supreme Court.
- Payment
of the second applicant’s pension was resumed with effect from
1 December 2007, which is when he ceased his professional activity.
The payment of the second, third and fourth applicants’
pensions was resumed with effect from 1 January 2009, which is when
the Amendments to the Pension Act entered into force, repealing
section 112 of the Pension Act 2003 (see paragraph 26 below).
B. Civil proceedings against the applicants
1. The first applicant
- On
30 June 2004 the Pension Fund lodged a compensation claim against the
first applicant, seeking repayment of the pension payments she had
received for January and February 2004 in the total amount of
425.74 euros (EUR). In response, the first applicant lodged a
counterclaim seeking payment of the pension which had not been paid
to her between March 2004 and December 2008 due to the suspension of
her pension rights, amounting in total to EUR 15,332.45.
- On
4 November 2009 the Court of First Instance (Osnovni sud) in
Herceg Novi, after joining the two proceedings, ruled in favour of
the first applicant, referring, in particular, to section 6 of the
Amendments to the Pension and Disability Insurance Act 2003
(hereinafter “the Amendments to the Pension Act”),
section 193 of the Pension Act 2003 as well as a decision of the
Constitutional Court of Montenegro (see paragraphs 26, 24 and 28
below). On 19 January 2010 the High Court (Viši sud) in
Podgorica overturned this judgment and ruled against the first
applicant, relying on sections 112 and 222 of the Pension Act 2003
and considering that their application was not retroactive. This
judgment was upheld by the Supreme Court on 3 June 2010, which court
mainly endorsed the reasons of the High Court. In doing so, the
Supreme Court in particular referred to section 112 of the Pension
Act 2003.
- On
29 July 2010 the Court of First Instance issued an enforcement order
providing that the Pension Fund would retain half the first
applicant’s pension until the entire sum owed had been paid. On
4 November 2010 this decision was upheld by the High Court.
2. The second and third applicants
- On
17 January 2007 and an unspecified date the Pension Fund lodged
compensation claims against the second and third applicants
respectively, seeking repayment of the pension they had received from
1 January 2004 onwards.
- On
20 June 2007 the Court of First Instance in Podgorica ruled against
the second applicant, which judgment was upheld by the High Court in
Podgorica on 13 February 2009. It would appear from the case file
that this decision has been enforced.
- On
25 February 2010 the Court of First Instance in Herceg Novi ruled in
favour of the third applicant. On 16 April 2010 the High Court in
Podgorica overturned this decision and ruled against him. In doing
so, it referred to the above decisions of the Administrative Court
and the Supreme Court (see paragraphs 11 and 12 above). It would
appear from the case file that this decision has been enforced in
subsequent enforcement proceedings.
4. The fourth applicant
- There
is no information in the case file as to whether the Pension Fund
instituted civil proceedings against the fourth applicant.
II. RELEVANT DOMESTIC LAW AND PRACTICE
A. Constitutional Charter of the State Union of Serbia
and Montenegro (Ustavna povelja drZavne zajednice Srbija i Crna Gora,
published in the Official Gazette of Serbia and Montenegro no. 1/03)
- Article
9 § 1 of the Constitutional Charter provided that both member
States shall regulate, safeguard and protect human rights in its
territory.
B. Pension and Disability Insurance Act 2003 (Zakon o
penzijskom i invalidskom osiguranju, published in the Official
Gazette of the Republic of Montenegro - OG RM - no. 54/03)
- Section
112 paragraph 1 provided that a person’s pension shall be
suspended should he or she resume working or establish a private
practice, for as long as this activity continues.
- Section
193 paragraph 1 provided that beneficiaries of, inter alia,
old-age pension (starosna penzija) and disability pension
(invalidska penzija), who obtained these rights in accordance
with the relevant legislation in force before this Act entered into
force, shall preserve these rights afterwards at the same level (u
istom obimu) with appropriate adjustments [on the basis of living
expenses and average salaries].
- Section
222 provided that this Act would enter into force on 1 January
2004.
C. Amendments to the Pension and Disability Insurance
Act 2003 (Zakon o izmjenama i dopunama zakona o penzijskom i
invalidskom osiguranju, published in the Official Gazette of
Montenegro - OGM - no. 79/08)
- Section
6 repealed section 112 paragraph 1 of the Pension Act 2003. These
Amendments entered into force on 1 January 2009.
D. Decision of the Federal Constitutional Court
published in the Official Gazette of the Federal Republic of
Yugoslavia no. 39/2002
- On
12 July 2002 the Federal Constitutional Court of Yugoslavia,
Yugoslavia being comprised of Montenegro and Serbia at the time, held
that section 32 of the Federal Pension and Disability Insurance Act,
which essentially corresponded to section 112 paragraph 1 of the
Pension Act 2003, was in breach of the Constitution of the Federal
Republic of Yugoslavia. In particular, once pension entitlements had
been acquired they could not be repealed or restricted by subsequent
measures. Further, there was a lack of proportionality between the
public interest, protection of which was allegedly the intention of
the provisions in question on the one hand and the interests of
individuals in respect of their property rights on the other. Lastly,
the court held that the section in question was indeed retroactive in
nature, since it had also been applied to pensioners who had resumed
professional activities before its entry into force.
E. Decision of the Constitutional Court of the Republic
of Montenegro U br. 7/04, 11/04, 30/04, 60/04 and 101/04
- On
10 November 2004 the Constitutional Court of the Republic of
Montenegro rejected an initiative to assess the constitutionality of
section 112 paragraph 1 of the Pension Act 2003. In so doing, it
held, inter alia, that it was a matter of legislative judgment
whether or not to allow a person to simultaneously receive pension
and resume working, and that therefore this matter fell outside the
jurisdiction of the Constitutional Court. It further held:
“According to the ...Constitutional Court, Article
112 § 1 of the 2003 Act does not have retroactive effect, as it
does not apply to situations which came into existence before its
entry into force, but only as regards those ... which have arisen ...
[thereafter] ...”.
F. Administrative Dispute Act (Zakon o upravnom sporu,
published in OG RM no. 60/03 and OGM no. 32/11)
- Articles
40-46 provide details concerning a request for judicial review
(zahtjev za vanredno preispitivanje sudske odluke).
- In
particular, Articles 40-42 provide that parties may file a request
for judicial review with the Supreme Court. They may do so within a
period of 30 days following receipt of a final decision rendered by
the Administrative Court, and only if the relevant legislation,
procedural or substantive, has been breached by the lower court.
- In
accordance with Article 46, the Supreme Court shall, should it accept
a request for judicial review lodged by one of the parties concerned,
have the power to overturn the impugned judgment or quash it and
order a re-trial before the Administrative Court.
THE LAW
I. JOINDER OF THE APPLICATIONS
- The
Court notes that the applications under examination concern the same
issue. It is therefore appropriate to join them, in accordance with
Rule 42 § 1 of the Rules of Court.
II. ALLEGED VIOLATION OF ARTICLE 1 OF PROTOCOL NO. 1 TO
THE CONVENTION
- The
applicants complained about the suspension of
their pensions.
- The
Court considers that their complaints naturally fall to be examined
under Article 1 of Protocol No. 1 only (see, mutatis mutandis,
Janković v. Croatia (dec.), no. 43440/98, ECHR 2000 X;
Skórkiewicz v. Poland (dec.), no 39860/98, 1 June 1999;
and Domalewski v. Poland (dec.), no. 34610/97, 15 June 1999),
which reads as follows:
“Every natural or legal person is entitled to the
peaceful enjoyment of his possessions. No one shall be deprived of
his possessions except in the public interest and subject to the
conditions provided for by law and by the general principles of
international law.
The preceding provisions shall not, however, in any way
impair the right of a State to enforce such laws as it deems
necessary to control the use of property in accordance with the
general interest or to secure the payment of taxes or other
contributions or penalties.”
Admissibility
1. Compatibility ratione personae
(a) As regards the applicants
- The
Government maintained that the applicants had lost their victim
status when the Amendments to the Pension Act entered into force on
1 January 2009, as of that moment payment of their pensions was
resumed (see paragraphs 26 and 14 above).
- The
first, second and third applicants contested this claim. The fourth
applicant made no comment in this respect. In particular, the first
applicant maintained that her victim status persisted, as she had
never obtained any compensation for the pension she had not received
for the period between 1 March 2004 and 31 December 2008, and was
thus still deprived of her property.
- The
Court reiterates that an individual can no longer claim to be a
victim of a violation of the Convention when the national authorities
have acknowledged, either expressly or in substance, a breach of the
Convention and have provided redress (see Eckle v. Germany, 15
July 1982, § 66, Series A no. 51). Accordingly, in principle,
where domestic proceedings are settled and include an admission of
the breach by the national authorities and the payment of a sum of
money amounting to redress, the dual requirements established in
Eckle are satisfied, and the applicant can no longer claim to
be a victim of a violation of the Convention.
- The
Court notes that in the present case the national authorities have
never acknowledged, either expressly or in substance, a breach of the
Convention, nor did they provide any redress for the suspension of
pensions which the applicants allege constituted a violation of the
Convention. On the contrary, the Government explicitly stated that
the suspension of the pensions was not in breach of the Convention,
and the domestic courts refused to award any compensation in this
respect (see paragraph 57 below and paragraphs 15-17 above).
- In
view of the above, without prejudging the merits of the case, the
Court considers that the applicants’ status as “victims”
within the meaning of Article 34 of the Convention is unaffected.
Accordingly, the Government’s objection in this regard must be
dismissed.
(b) As regards the respondent States
- The
first and third applicants made complaints against both Montenegro
and Serbia.
- The
Court notes that each member State of the then State Union of Serbia
and Montenegro was responsible for the protection of human rights in
its own territory (see paragraph 22 above). Given the fact that the
entire proceedings have been conducted solely within the competence
of the Montenegrin authorities, which also had the exclusive
competence to deal with the subject matter, the Court, without
prejudging the merits of the case, finds the applicants’
complaints in respect of Montenegro compatible ratione personae
with the provisions of the Convention and Protocol No. 1 thereto.
For the same reason, however, the first and third applicants’
complaint in respect of Serbia is incompatible ratione personae
within the meaning of Article 35 § 3, and must be
rejected pursuant to Article 35 § 4 of the Convention (see
Bijelić v. Montenegro and Serbia, no. 11890/05, § 70,
28 April 2009, and Šabanović v. Montenegro and
Serbia, no. 5995/06, § 28, 31 May 2011).
2. Compatibility ratione temporis
- Even
though the Government did not raise any objection in this regard, the
Court has to satisfy itself that it has jurisdiction in any case
brought before it (see, mutatis mutandis, Blečić v.
Croatia [GC], no. 59532/00, § 67, ECHR 2006-III, as
well as Kavaja and Miljanić v. Montenegro (dec.),
nos. 43562/02 and 37454/08, § 30, 23
November 2010).
- The
Court notes that the relevant domestic legislation providing for the
suspension of the applicants’ pensions had entered into force
on 1 January 2004, which was before the respondent State’s
ratification of Protocol No. 1 to the Convention on 3 March 2004.
However, the Court also observes that the applicants continued to
receive their pensions until well after 3 March 2004. The suspension,
therefore, did not automatically take place on the basis of the
legislation alone, but only after the Pension Fund had rendered
specific decisions to that effect, all of which were issued after the
respondent State’s ratification of the Convention and Protocol
No. 1 thereto.
- In
view of this, the Court considers that the impugned interference
falls within this Court’s competence ratione temporis
(see, mutatis mutandis, Blečić, cited above, §
83-84; as well as Zana v. Turkey, 25 November 1997, §
42, Reports of Judgments and Decisions 1997 VII).
3. Exhaustion of domestic remedies
(a) As regards the first applicant
- The
Government maintained that the first applicant had not exhausted all
effective domestic remedies. In particular, she did not seek a
Supreme Court judicial review.
- The
first applicant contested the effectiveness of this remedy,
especially in view of the decisions given in respect of the other
three applicants, and in view of the fact that the Supreme Court had,
in any case, ruled against her in the civil proceedings (see
paragraphs 12, 15 and 16 above).
- The
Court reiterates that, according to its established case-law, the
purpose of the domestic remedies rule contained in Article 35
§ 1 of the Convention is to afford the Contracting States the
opportunity of preventing or putting right the violations alleged
before they are submitted to the Court. However, the only remedies to
be exhausted are those which are effective.
- It is incumbent on the Government claiming
non-exhaustion to satisfy the Court that the remedy was an effective
one, available in theory and in practice at the relevant time, that
is to say, that it was accessible, was one which was capable of
providing redress in respect of the applicant’s complaints and
which offered reasonable prospects of success. However, once this
burden of proof has been satisfied, it falls to the applicant to
establish that the remedy advanced by the Government was in fact used
or was for some reason inadequate and ineffective in the particular
circumstances of the case, or that there existed special
circumstances absolving him or her from the requirement (see Akdivar
and Others v. Turkey, 16 September 1996, § 65,
Reports of Judgments and Decisions 1996-IV).
- The
application of this rule must make due allowance for the context.
Accordingly, it has recognised that Article 35 § 1 must be
applied with some degree of flexibility and without excessive
formalism (see Akdivar and Others, cited above, § 69).
- The
Court recalls that it has already established that an appeal on
points of law in civil proceedings (revizija) and an appeal on
points of law in criminal proceedings (zahtjev za ispitivanje
zakonitosti pravosnaZne presude), are, in principle, effective
domestic remedies within the meaning of Article 35 § 1 of the
Convention (see, mutatis mutandis, Rakić and Others v.
Serbia, nos. 47460/07 et seq., §§ 37 and 27, 5 October
2010, and the authorities cited therein; Debelić v.
Croatia, no. 2448/03, §§ 20 and 21, 26 May
2005; and Mamudovski v. the former Yugoslav Republic of Macedonia
(dec.), no. 49619/06, 10 March 2009). As the request for judicial
review in the administrative dispute, even if described as
“extraordinary” in the Administrative Dispute Act
(zahtjev za vanredno preispitivanje sudske odluke) corresponds
to the said remedies in civil and criminal proceedings, the Court
considers that, given its nature, it must also, in principle and
whenever available in accordance with the relevant rules on
procedure, be considered an effective domestic remedy within the
meaning of Article 35 § 1 of the Convention (compare and
contrast the analysis in Kolu v. Finland (dec.), no. 56463/10,
ECHR 3 May 2011).
- Turning
to the present case, the Court notes that the first applicant indeed
failed to submit a request for judicial review with the Supreme
Court. It also notes that the Supreme Court ruled against the other
three applicants upon their requests for judicial review, whose
claims were identical to the claim of the first applicant, and, in
doing so, it essentially endorsed the reasons given previously by the
Administrative Court (see paragraph 12 above). In addition, the
Supreme Court had indeed had a chance to rule in respect of the first
applicant, albeit in civil proceedings, and it ruled against her (see
paragraph 16 above). As there is nothing in the case file to suggest
that the Supreme Court would have ruled any differently in respect of
the first applicant, the Court considers that requiring her to use
this remedy in such circumstances, would amount to excessive
formalism and that therefore she did not have to exhaust this
particular avenue of redress (see, mutatis mutandis, Uljar
and Others v. Croatia, no. 32668/02, § 32 in fine,
8 March 2007). The Government’s objection in this regard must
therefore be dismissed.
(b) As regards the other applicants
- The
Government maintained that the applicants had not exhausted all
effective domestic remedies. In particular, they had not instituted
civil proceedings in order to obtain compensation.
- The
first applicant submitted that she had instituted civil proceedings,
but to no avail, as the domestic courts had ruled against her. The
second and third applicants contested the effectiveness of civil
proceedings, claiming that the domestic courts had never awarded any
damages in such cases, and inviting the Government to submit any
domestic case-law to the contrary. The fourth applicant made no
comment in this respect.
- The
Court notes that the first applicant did institute civil proceedings
for compensation, but that the domestic courts ruled against her (see
paragraphs 15-17 above). The Court also observes that the Government
failed to submit any other domestic case-law in support of their
claim that the applicants could have obtained compensation in civil
proceedings.
- In
view of the above, the Court is of the opinion that the civil
proceedings cannot be considered as an effective domestic remedy in
the particular circumstances of the case, thus absolving the second,
third and fourth applicants of the requirement to make use of this
remedy. The Government’s objection in this regard must
therefore also be dismissed.
4. Conclusion
- The
Court notes that the applicants’ complaints are not manifestly
ill-founded within the meaning of Article 35 § 3 (a) of the
Convention. It further notes that they are not inadmissible on any
other grounds. They must therefore be declared admissible.
Merits
1. The parties’ submissions
- The
Government maintained that there was no general obligation on the
State to allow pensioners to work, and that thus it was within the
State’s discretion as to how to regulate it. In particular, it
was not in the public interest for people to enjoy the benefits of
both a pension and work at the same time. In this respect the
Government noted that the domestic authorities were better placed to
assess what was in the public interest, and had a wide margin of
appreciation in that regard. Therefore, the impugned provision of the
Pension Act 2003 was a legitimate measure in the public interest,
proportionate to the legitimate aim of preserving the budgetary
stability of the State and improving social policy. As everybody
could choose which right they preferred to use, a fair balance was
achieved between the private interests of the applicants on the one
hand and the public interest on the other. Therefore, there was no
violation of Article 1 of Protocol No. 1.
- The
first, second and third applicants contested these
claims. In particular, the first applicant referred to section
193 of the Pension Act 2003 (see paragraph 24 above), arguing that it
confirmed that this Act did not have retroactive effect but that it
should have been applied only to pensioners who re-established their
private practice after this Act had entered into force. She held that
this was further confirmed by the Constitutional Court of Montenegro
(see paragraph 28 above), as well as, eventually, by the State itself
when it abolished the relevant part of the relevant section (see
paragraph 26 above). The second applicant, in
particular, maintained that the State had proved the unlawfulness of
the relevant part of the provision concerned by abolishing it by
means of the Amendments to the Pension Act. The fourth applicant made
no comment in this respect.
2. The Court’s assessment
- The
principles which apply generally in cases under Article 1 of Protocol
No. 1 are equally relevant when it comes to pensions (see Andrejeva
v. Latvia [GC], no. 55707/00, § 77, 18 February 2009, and,
more recently, Stummer v. Austria [GC], no. 37452/02,
§ 82, 7 July 2011). Thus, that provision does not
guarantee the right to acquire property (see, among other
authorities, Van der Mussele v. Belgium, 23 November 1983, §
48, Series A no. 70; Slivenko v. Latvia (dec.) [GC], no.
48321/99, § 121, ECHR 2002 II; and Kopecký v.
Slovakia [GC], no. 44912/98, § 35 (b), ECHR 2004 IX).
Nor does it guarantee, as such, any right to a pension of a
particular amount (see, among other authorities, Müller v.
Austria, no. 5849/72, Commission’s report of 1 October
1975, Decisions and Reports (DR) 3, p. 25; T. v. Sweden, no.
10671/83, Commission decision of 4 March 1985, DR 42, p. 229;
Janković v. Croatia (dec.), no. 43440/98, ECHR 2000 X;
Kuna v. Germany (dec.), no. 52449/99, ECHR 2001 V
(extracts); Lenz v. Germany (dec.), no. 40862/98, ECHR 2001 X;
Kjartan Ásmundsson v. Iceland, no. 60669/00, § 39,
ECHR 2004 IX; Apostolakis v. Greece, no. 39574/07, §
36, 22 October 2009; Wieczorek v. Poland, no. 18176/05, §
57, 8 December 2009; Poulain v. France (dec.), no. 52273/08,
8 February 2011; and Maggio and Others v. Italy,
nos. 46286/09, 52851/08, 53727/08, 54486/08 and 56001/08,
§ 55, 31 May 2011). However, where a
Contracting State has in force legislation providing for the payment
as of right of a pension – whether or not conditional on the
prior payment of contributions – that legislation has to be
regarded as generating a proprietary interest falling within the
ambit of Article 1 of Protocol No. 1 for persons satisfying its
requirements (see Carson and Others v. the United Kingdom [GC],
no. 42184/05, § 64, ECHR 2010 ...). The reduction or
the discontinuance of a pension may therefore constitute interference
with possessions that needs to be justified (see Kjartan
Ásmundsson, cited above, § 40; Rasmussen v.
Poland, no. 38886/05, § 71, 28 April 2009; and
Wieczorek, cited above, § 57).
- The
first and most important requirement of Article 1 of Protocol No. 1
is that any interference by a public authority with the peaceful
enjoyment of possessions should be lawful (see The Former
King of Greece and Others v. Greece [GC], no. 25701/94, §§
79 and 82, ECHR 2000-XII) and that it should pursue a legitimate aim
“in the public interest”.
- According
to the Court’s case law, the national authorities, because
of their direct knowledge of their society and its needs, are in
principle better placed than the international judge to decide what
is “in the public interest”. Under the Convention system,
it is thus for those authorities to make the initial assessment as to
the existence of a problem of public concern warranting measures
interfering with the peaceful enjoyment of possessions. Moreover, the
notion of “public interest” is necessarily extensive. In
particular, the decision to enact laws concerning pensions or welfare
benefits involves consideration of various economic and social
issues. The Court accepts that in the area of social legislation
including in the area of pensions States enjoy a wide margin of
appreciation, which in the interests of social justice and economic
well-being may legitimately lead them to adjust, cap or even reduce
the amount of pensions normally payable to the qualifying population
including, like in the instant case, by means of rules on
incompatibility between the receipt of a pension and paid employment.
However, any such measures must be implemented in a
non-discriminatory manner and comply with the requirements of
proportionality. Therefore, the margin of appreciation available to
the legislature in implementing such policies should be a wide one,
and its judgment as to what is “in the public interest”
should be respected unless that judgment is manifestly without
reasonable foundation (see, for example, Carson and Others v. the
United Kingdom [GC], no. 42184/05, § 61, 16 March 2010;
Andrejeva v. Latvia [GC], no. 55707/00, § 83, 18 February
2009; as well as Moskal v. Poland, no. 10373/05, § 61, 15
September 2009).
- Any
interference must also be reasonably proportionate to the aim sought
to be realised. In other words, a “fair balance” must be
struck between the demands of the general interest of the community
and the requirements of the protection of the individual’s
fundamental rights. The requisite balance will not be found if the
person or persons concerned have had to bear an individual and
excessive burden (see James and Others v. the United Kingdom,
21 February 1986, § 50, Series A no. 98; and Wieczorek,
cited above, §§ 59 60, with further references).
- While
it must not be overlooked that Article 1 of Protocol No. 1 does not
restrict a State’s freedom to choose the type or amount of
benefits that it provides under a social security scheme (see Stec
and Others, cited above § 54; Stec and Others v. the
United Kingdom [GC], no. 65731/01, § 53, ECHR 2006 VI;
and Wieczorek, cited above, § 66 in limine), it is
also important to verify whether an applicant’s right to derive
benefits from the social security scheme in question has been
infringed in a manner resulting in the impairment of the essence of
his pension rights (see Domalewski, cited above; Kjartan
Ásmundsson, cited above, § 39 in fine; and
Wieczorek, cited above, § 57 in fine).
- Turning
to the present case, the Court considers that the applicants’
pension entitlements constituted a possession within the meaning of
Article 1 of Protocol No. 1 to the Convention. Further, the Pension
Fund’s suspension of payment of the applicants’ pensions
clearly amounted to an interference with the peaceful enjoyment of
their possessions (see paragraph 59 above).
- As
regards the requirement of lawfulness, the Court notes that the
payment of pensions was suspended on the basis of section 112 of the
Pension Act 2003, which seems to imply that it was in accordance with
the law. Certainly, the interpretation of this provision given by the
domestic courts favours such a conclusion (see paragraph 16 above).
- The
Court considers that such an interpretation of the domestic courts
raises some doubts in view of Section 193 of the Pension Act 2003, as
well as in view of the decision of the Constitutional Court of
Montenegro, and the ruling of the Federal Constitutional Court in
respect of an essentially identical provision of the Federal Pension
and Disability Insurance Act, both Montenegro and Serbia being part
of one legal system at the time (see paragraphs 24, 28 and 27 above).
- In
any event, even assuming that it was in accordance with law, it
remains to be resolved whether the said interference pursued a
legitimate aim and if there was a reasonable relationship of
proportionality between the means employed and the aim sought to be
realised.
- Even
though the Government submitted no supporting documents as to the
benefits of this measure, the Court may accept that the aims pursued
were social justice and the State’s economic well-being, both
of which are legitimate.
- As
regard the issue of proportionality the Court notes that the
initial decisions issued by the Pension Fund conferred on the
applicants the entitlement to receive their respective pensions. In
doing so, the Pension Fund agreed that the applicants had satisfied
all the statutory conditions and qualified for the pensions. Under
the rules in force at the time, gainful employment was not
incompatible with a Fund member’s receipt of a full pension, as
long as the employment was on a part-time basis (see paragraph 8
above). After meeting the legal criteria for retirement, and
encouraged by the pension system to which they had contributed over a
number of years, the applicants reopened their private practices on a
part-time basis whilst at the same time receiving their pensions
(see, mutatis mutandis, Kjartan Ásmundsson, cited
above, § 44, ECHR 2004 IX).
- The
Court further notes that, when the applicants’ pensions were
suspended by the relevant Pension Fund decisions in 2004 and 2005,
this was not due to any changes in their own circumstances, but to
changes in the law. This particularly affected the applicants, as it
entirely suspended the payment of the pensions they had been
receiving for a number of years, taking no account of the amount of
revenue generated by their part-time work (see, mutatis mutandis,
Kjartan Ásmundsson, cited above, § 44, as well as,
in contrast, among many authorities, Domalewski and
Skórkiewicz, both cited above, where the applicants
were deprived only of their special privileged status, while
retaining all the rights attaching to their ordinary pension under
the general social insurance system). Even though the applicants have
submitted no data as to how much exactly they earned in their private
practice, and as the Government have offered no evidence to the
contrary, in view of the fact that they worked on a part-time basis
only the Court considers that the pension still constituted a
considerable part of their gross monthly income (see Kjartan
Ásmundsson, cited above, § 44).
- In
this context, the Court also observes that the Pension Act 2003
affected not only the applicants’ right to receive their
pension in the future but partly also the payments received hitherto,
as the first, second and third applicants were obliged to pay back
the amounts they had received after 1 January 2004 (see
paragraphs 17, 19 and 20 above, as well as, in contrast, mutatis
mutandis, Wieczorek v. Poland, cited above, § 72, and
Hasani v. Croatia (dec.), no. 20844/09, 30 September 2010).
- Against
this background, the Court finds that, as individuals, the applicants
were made to bear an excessive and disproportionate burden. Even
having regard to the wide margin of appreciation enjoyed by the State
in the area of social legislation, the impact of the impugned measure
on the applicants’ rights, even assuming its lawfulness (see
paragraph 66 above), cannot be justified by the legitimate public
interest relied on by the Government. It could have been
otherwise had the applicants been obliged to endure a reasonable and
commensurate reduction rather than the total suspension of their
entitlements (see, among many authorities, Kjartan Ásmundsson,
cited above, § 45; Wieczorek v. Poland, cited above,
§ 67, Maggio and Others v. Italy, cited above, §
62, Banfield v. the United Kingdom (dec.), no. 6223/04,
18 October 2005) or if the legislature had afforded them a
transitional period within which to adjust themselves to the new
scheme. Furthermore, they were required to pay back the pensions they
had received as of 1 January 2004 onwards, which must also be
considered a relevant factor to be weighed in the balance.
- In
view of the above, the Court considers that there has been a
violation of Article 1 of Protocol No. 1.
III. APPLICATION OF ARTICLE 41 OF THE CONVENTION
- 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
- The
first applicant claimed EUR 15,769.07 in respect
of pecuniary damage (EUR 15,332.45 on account of suspended pensions
and EUR 436.62 on account of pensions reimbursed to the Pension
Fund) and EUR 9.000 in respect of non-pecuniary damage.
- The
second applicant claimed EUR 12,377.3 in respect of pecuniary damage
(EUR 8,532.86 on account of suspended pensions and EUR 3,844.44
on account of pensions reimbursed to the Pension Fund).
- The
third applicant claimed a total amount of EUR 18,448.8 in respect of
pecuniary damage and EUR 5,000 in respect of non-pecuniary damage.
- The
fourth applicant claimed EUR 10,618.49 in respect of pecuniary
damage. He enclosed a calculation made by the Pension Fund stating
that the unpaid pensions amounted to EUR 8,038.53, as he had been
regularly receiving the pension until 1 May 2005.
- The
Government maintained that the amounts sought by the applicants were
inappropriately high and not in line with the relevant case-law of
the Court.
- The
Court is satisfied that the applicants have suffered pecuniary damage
as a result of the violation found and considers that they should be
awarded compensation in an amount reasonably related to any prejudice
suffered. It cannot award them the full amounts claimed, precisely
because a reasonable and commensurate reduction in their entitlement
could have been compatible with their Convention rights (see
paragraph 72 above). Deciding in the light of the figures available
in the case file, the Court awards the first and third applicants EUR
8,000 each, the second applicant EUR 6,000 and the fourth applicant
EUR 4,000, plus any tax that may be chargeable on those amounts (see,
mutatis mutandis, Kjartan Ásmundsson, cited
above, § 51).
- Even
if not the subject of a specific claim by the second and fourth
applicants, the Court accepts that all the applicants in the present
case have certainly suffered some non-pecuniary damage which cannot
be sufficiently compensated by the sole finding of a violation (see,
mutatis mutandis, Garzičić v. Montenegro, no.
17931/07, § 42, 21 September 2010; as well as
Staroszczyk v. Poland, no. 59519/00, §§
141-143, 22 March 2007). Making its assessment on an equitable
basis, the Court awards each of them the sum of EUR 4,000.
B. Costs and expenses
- The
first applicant claimed EUR 679.8 in total for
the costs and expenses incurred both before the domestic courts and
this Court. The third applicant claimed a lump sum of EUR 400
for the costs of “translation and correspondence”. The
second and the fourth applicants made no claims in this respect.
- The
Government left the decision in this respect to the Court’s
discretion.
- According
to the Court’s case-law, an applicant is entitled to the
reimbursement of costs and expenses only in so far as it has been
shown that these have been actually and necessarily incurred and are
reasonable as to quantum. In the present case, regard being
had to the documents in its possession and the above
criteria, the Court considers it reasonable to award the
entire sum claimed by the first applicant. As the third applicant
failed to submit evidence, such as itemised bills and invoices, that
the expenses sought had actually been incurred, the Court accordingly
rejects that claim. Lastly, the Court considers that there is no call
to award the second and fourth applicants any
sum on this account, as they made no claims in this respect.
C. Default interest
- The
Court considers it appropriate that the default interest 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
- Decides to join the applications;
- Declares the complaints in respect of Montenegro
admissible, and the complaints in respect of Serbia inadmissible;
- Holds that there has been a violation of Article
1 of Protocol No. 1 to the Convention;
- Holds
(a) that
the respondent State is to pay the applicants, within
three months of the date on which the judgment becomes
final in accordance with Article 44 § 2 of the
Convention, the following amounts plus any tax that may be
chargeable:
(i)
the first and third applicants EUR 8,000 (eight thousand euros) each,
the second applicant EUR 6,000 (six thousand euros) and the fourth
applicant EUR 4,000 (four thousand euros), in respect of pecuniary
damage,
(ii)
EUR 4,000 (four thousand euros) each for non-pecuniary damage, and
(iii)
EUR 679.8 (six hundred and seventy-nine euros and eighty cents) to
the first applicant for costs and expenses.
(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 13 December 2011,
pursuant to Rule 77 §§ 2 and 3 of the Rules of Court.
Fatoş Aracı Lech Garlicki Deputy
Registrar President
