DIMITROVI v. BULGARIA - 12655/09 (Judgment (Just Satisfaction) : Court (Fifth Section)) [2016] ECHR 683 (21 July 2016)

In the case of Dimitrovi v. Bulgaria,

The European Court of Human Rights (Fifth Section), sitting as a Chamber composed of:

          Angelika Nußberger, President,
          Ganna Yudkivska,
          Faris Vehabović,
          Síofra O’Leary,
          Carlo Ranzoni,
          Mārtiņš Mits, judges,
          Pavlina Panova, ad hoc judge,
and Claudia Westerdiek, Section Registrar,

Having deliberated in private on 28 June 2016,

Delivers the following judgment, which was adopted on that date:

PROCEDURE

1. The case originated in an application (no. 12655/09) against the Republic of Bulgaria lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (“the Convention”) by two Bulgarian nationals, Ms Angelina Nedyalkova Dimitrova and Mr Konstantin Konstantinov Dimitrov (“the applicants”), on 23 January 2009.

2. The applicants were represented by Mr L. Angelov, a lawyer practising in Sofia. The Bulgarian Government (“the Government”) were represented by their Agent, Ms M. Dimova, of the Ministry of Justice.

3. In a judgment delivered on 3 March 2015 (“the principal judgment”), the Court held that the respondent State had unfairly forfeited the applicants’ property, in breach of Article 1 of Protocol No. 1. It found in particular that the taking of the applicants’ property had failed to meet the requirement of lawfulness, as the legislation it had been based on, dating back to 1973 and repealed in the meantime, did not provide a sufficient measure of legal protection against arbitrariness, and its consequences were not foreseeable. The Court found furthermore that the interference with the applicants’ rights had not been shown to pursue any legitimate aim (see Dimitrovi v. Bulgaria, no. 12655/09, §§ 44-55, 3 March 2015).

4. Under Article 41 of the Convention the applicants sought just satisfaction. However, judging that the question of the application of Article 41 was not ready for decision as regards pecuniary damage, the Court reserved it and invited the Government and the applicants to submit, within four months of its judgment’s entry into force, written observations on the matter, and in particular to notify it of any agreement they might reach (ibid., § 60, and point 3 of the operative provisions).

5. The applicants and the Government each submitted observations.

6. On 12 April 2015 Mr Yonko Grozev, the judge elected in respect of Bulgaria, withdrew from sitting in the case (Rule 28 § 3 of the Rules of Court). Accordingly, on 4 May 2016 the President of the Section selected Ms Pavlina Panova as an ad hoc judge from the list of five persons designated by the Republic of Bulgaria as eligible to serve as such a judge (Article 26 § 4 of the Convention and Rule 29 § 1 (a) of the Rules of Court).

THE LAW

7. 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

8. In § 17 of the principal judgment the Court noted that the following properties had been forfeited from the applicants: a flat in Varna, and a flat, an office, a garage and a share of a plot of land in Sofia. In addition, the applicants had been ordered by the national courts to pay to the State the monetary value of a holiday house in the Borovets resort and a car, as both had in the meantime been transferred to private parties.

1. Submissions from the parties

9. In the proceedings preceding the principal judgment (see § 58 of that judgment), the applicants claimed, first, the current value of their forfeited properties. They presented the reports of an expert appointed in the domestic judicial proceedings whereby the forfeiture had been ordered, assessing, as of 2005 when the reports had been drawn up, the value of the flat in Varna at 71,800 Bulgarian levs (BGN), the equivalent of approximately 36,820 euros (EUR), and the value of the flat, the office and the garage in Sofia at BGN 601,400 in total, the equivalent of EUR 308,410. The applicants claimed those amounts. They have consistently stated that they did not wish to recover the properties at issue, because the ones in Sofia in particular had not been maintained and were in a bad state of repair.

10. The applicants also claimed the amount they had been ordered to pay for the holiday house and the car (see paragraph 8 above). They submitted evidence showing that in 2010 they had paid the State BGN 178,815, the equivalent of EUR 91,230, on that account, which had also included BGN 14,019.34, the equivalent of EUR 7,150, for court fees and other expenses (see § 20 of the principal judgment). The latter amount was awarded to the applicants by the Court under the head of costs and expenses (see § 69 of the principal judgment).

11. The applicants did not claim any pecuniary damage as regards the share of a plot of land which had also been forfeited from them, nor did they cite lost profit for having been prevented from using their properties.

12. Following the principal judgment, the applicants confirmed their claims for pecuniary damage.

13. The Government contested the applicants’ claims, considering them unjustified and unsubstantiated. They were of the view that the finding of a violation of the applicants’ rights did not imply an automatic and mandatory award of compensation. If the Court found compensation to be necessary, the Government called for a minimal amount.

14. The Government pointed out in addition that following the principal judgment it had been open to the applicants to seek the reopening of the domestic judicial proceedings in which the courts had ordered the forfeiture of their property.

15. Lastly, the parties informed the Court that no settlement had been reached between them.

2. The Court’s assessment

16. As a preliminary note, in relation to the Government’s argument that the applicants should have sought reopening of the domestic proceedings (see paragraph 14 above), the Court notes that the rule that domestic remedies should be exhausted does not apply to just satisfaction claims submitted to it under Article 41 (see Salah v. the Netherlands, no. 8196/02, § 67, ECHR 2006-IX (extracts)).

17. The Court reiterates that a judgment in which it finds a breach of the Convention imposes on the respondent State a legal obligation to put an end to that breach and make reparation for its consequences in such a way as to restore as far as possible the situation existing before the breach (see Iatridis v. Greece (just satisfaction) [GC], no. 31107/96, § 32, ECHR 2000-XI).

18. The basis on which the Court proceeds as regards pecuniary damage depends on the nature of the breaches found. Illegal and arbitrary dispossessions of property in principle justify restitutio in integrum and, in the event of failure on the part of the respondent State to effectuate this, payment of a sum reflecting the value of the property taken (see Papamichalopoulos and Others v. Greece (Article 50), 31 October 1995, §§ 36-39, Series A no. 330-B; Brumărescu v. Romania (just satisfaction) [GC], no. 28342/95, §§ 21-24, ECHR 2001-I; and Kehaya and Others v. Bulgaria (just satisfaction), nos. 47797/99 and 68698/01, § 19, 14 June 2007).

19. In the present case, the Court found that the interference with the applicants’ property rights failed to meet the requirement of lawfulness under Article 1 of Protocol No. 1 and pursued no legitimate aim (see paragraph 3 above). Accordingly, the respondent State should compensate the applicants fully for the loss of their property (see, for example, in addition to the cases cited in the previous paragraph, the Court’s remarks, albeit obiter, in Former King of Greece and Others v. Greece [GC] (just satisfaction), no. 25701/94, §§ 75-78, 28 November 2002, also Todorova and Others v. Bulgaria (just satisfaction), nos. 48380/99, 51362/99, 60036/00 and 73465/01, §§ 9-11, 24 April 2008).

20. The applicants stated that they did not wish restitutio in integrum, because the properties in Sofia in particular had not been maintained and had lost much of their value (see paragraph 9 above). The Government, for their part, argued for no or minimal compensation (see paragraph 13 above). In addition, for the Court it is significant that the parties have failed to reach a friendly settlement (see paragraph 15 above), by means of which the Government could have proposed at least partial restitution.

21. Accordingly, in the circumstances of the present case, and given that the applicants have not claimed restitutio in integrum, the Court holds that the respondent State is to pay them monetary compensation reasonably related to the market value of their forfeited properties.

22. As to the amount of that compensation, the only valuation of the property at issue at the disposal of the Court is the one presented by the applicants, prepared in 2005 (see paragraph 9 above and § 58 of the principal judgment). In the absence of any alternative provided by the Government, the Court will proceed on the basis of this valuation.

23. Accordingly, the Court holds that, in the absence of any alternative provided by the Government, the latter are to pay the applicants, as per the conclusions of the above-mentioned reports established in the context of the domestic proceedings, EUR 36,820 for the flat in Varna and EUR 308,410 for the properties in Sofia, or EUR 345,230 in total.

24. The Government should also restore to the applicants the additional amount paid by them for the value of the properties which had been transferred to third parties prior to the forfeiture, namely EUR 84,080 (the global amount of EUR 91,230 paid by them, minus the EUR 7,150 awarded by the Court in the principal judgment under the head of costs and expenses - see paragraph 10 above and §§ 17, 58 and 69 of the principal judgment).

25. The global amount awarded by the Court is thus EUR 429,310. To this should be added any tax that might be chargeable.

B. Costs and expenses

26. For the proceedings under Article 41 of the Convention, the applicants claimed EUR 1,500 for the work of the lawyer retained by them, Mr L. Angelov. In support of this claim they presented a contract for legal representation. They requested that any amount awarded under this head be transferred directly into Mr Angelov’s bank account.

27. The Government did not comment.

28. 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.

29. In the present case, regard being had to the documents in its possession and the above criteria, the Court awards the applicants EUR 500 under the present head. As requested by the applicants, this sum is to be paid directly to their legal representative.

C. Default interest

30. 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,

1. Holds

(a) that the Respondent State is to pay the applicants, within three months from the date on which the judgment becomes final in accordance with Article 44 § 2 of the Convention, the following amounts, to be converted into Bulgarian levs at the rate applicable at the date of settlement:

(i) EUR 429,310 (four hundred and twenty-nine thousand three hundred and ten euros), plus any tax that may be chargeable, in respect of pecuniary damage;

(ii) EUR 500 (five hundred euros), plus any tax that may be chargeable to the applicants, in respect of costs and expenses, to be transferred directly into the bank account of the applicants’ legal representative;

(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;

2. Dismisses the remainder of the applicants’ claim for just satisfaction.

Done in English, and notified in writing on 21 July 2016, pursuant to Rule 77 §§ 2 and 3 of the Rules of Court.

Claudia Westerdiek Angelika Nußberger
Registrar President

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