AS TO THE ADMISSIBILITY OF

                      Application No. 35223/97

                      by Ingeborg PELTZER and Barbara von WERDER

                      against Germany

     The European Commission of Human Rights (First Chamber) sitting

in private on 21 May 1998, the following members being present:

           MM    M.P. PELLONPÄÄ, President

                 N. BRATZA

                 E. BUSUTTIL

                 A. WEITZEL

                 C.L. ROZAKIS

           Mrs   J. LIDDY

           MM    L. LOUCAIDES

                 B. MARXER

                 B. CONFORTI

                 I. BÉKÉS

                 G. RESS

                 A. PERENIC

                 C. BÎRSAN

                 K. HERNDL

                 M. VILA AMIGÓ

           Mrs   M. HION

           Mr    R. NICOLINI

           Mrs   M.F. BUQUICCHIO, Secretary to the Chamber

     Having regard to Article 25 of the Convention for the Protection

of Human Rights and Fundamental Freedoms;

     Having regard to the application introduced on 19 February 1997

by Ingeborg PELTZER and Barbara von WERDER against Germany and

registered on 10 March 1997 under file No. 35223/97;

     Having regard to the report provided for in Rule 47 of the Rules

of Procedure of the Commission;

     Having deliberated;

     Decides as follows:

THE FACTS

     The first applicant, born in 1939, is a German national. She is

resident in Frankfurt/Main. The second applicant is her only sister

Barbara von Werder, a German national born in 1936, resident in Mollie-

Margot (Switzerland). In the proceedings before the Commission, they

are represented by Mr. M. Peltzer, the first applicant's husband, and

Mr. K. Müller, both lawyers practising in Frankfurt/Main.

     The facts of the case, as submitted by the applicants, may be

summarised as follows.

A.   Particular circumstances of the case

     The applicants' late parents were owners of the manorial estate

"Karnitz", Rügen. Their property was expropriated in connection with

the land reform carried out between 1945 and 1949 in the former Soviet-

occupied zone of Germany. The expropriation also extended to movable

property on the premises such as household effects. Both applicants

claim to be the only legal successors of their late parents.

     On 13 November 1992 the Schwerin Regional Office for the

Regulation of Unresolved Property Questions (Landesamt zur Regelung

offener Vermögensfragen) rejected the first applicant's request for

full restitution of the estate on her own behalf.

           The decision was based on S. 1 para. 8 (a) of the Act

Regulating Unresolved Property Questions (Gesetz zur Regelung offener

Vermögensfragen), excluding the restitution of property expropriated

under Soviet occupation law or power between 1945 and 1949. This

provision was considered to be applicable to the real property in

question which had been expropriated by operation of law by a 1945 land

reform decree (Verordnung Nr. 19 der Landesverwaltung Mecklenburg über

die Bodenreform im Lande Mecklenburg vom 5.9.1945) applying to all

estates of more than 100 hectares.

     On 5 October 1993 the Greifswald Administrative Court

(Verwaltungsgericht) dismissed the first applicant's suit against this

decision.

     In its decision, the Administrative Court observed at the outset

that the first applicant had only submitted proof as to her legal

succession after her late mother who had initially owned an ideal share

of two thirds of the estate. The mere contention that the remaining one

third, initially owned by her late father, had upon his death passed

on to her mother and thus, upon the death of the mother, to the first

applicant, was not sufficient.

     However, the Court found that this matter could be left open

because the expropriation had occurred under the authority of the

Soviet occupation power and S. 1 para. 8 (a) of the Act Regulating

Unresolved Property Questions excluded the restitution of such

property.

     The Administrative Court, referring to two decisions of the

Federal Constitutional Court (Bundesverfassungsgericht) of

23 April 1991 and 15 April 1993, found that the exclusion from

restitution of this group of expropriations did not amount to a

violation of fundamental rights. As regards the first applicant's

argument that recent revelations had shown that the Soviet Union had

never regarded the non-restitution of property expropriated under its

occupation as a precondition for the German unification, the

Administrative Court, relying on the Federal Constitutional Court's

decision of 15 April 1993, considered that it was only competent to

review whether the Federal Government, at the time of the negotiations,

had arbitrarily misinterpreted the position of the Soviet Union. In

this respect, there was no indication of a violation of fundamental

rights on account of Article 41 para. 1 of the Unification Treaty.  As

for the rest, the political discretion of the decision-making bodies

was not subject to judicial control.

     On 1 September 1994 the Federal Administrative Court

(Bundesverwaltungsgericht) dismissed the first applicant's request for

leave to appeal on points of law (Nichtzulassungsbeschwerde).

     On 22 August 1996 the Federal Constitutional Court refused to

entertain the first applicant's constitutional complaint

(Verfassungsbeschwerde). It referred to its previous case-law according

to which Article 143 para. 3 of the Basic Law and S. 1 para. 8 (a) of

the Act Regulating Unresolved Property Questions, both excluding the

restitution of property expropriated on the basis of Soviet

occupational power between 1945 and 1949, did not violate any

constitutional rights.

B.   Relevant law

     According to the Joint Declaration on outstanding property issues

(Gemeinsame Erklärung zur Regelung offener Vermögensfragen) made on

15 June 1990 by the Governments of the Federal Republic of Germany and

the German Democratic Republic, which is a constituent part of the

Treaty on German Unification of 31 August 1990 (Einigungsvertrag),

"expropriations carried out on the basis of occupation law or the

authority resulting from occupational power (1945 and 1949)"

("Enteignungen auf besatzungsrechtlicher bzw. besatzungshoheitlicher

Grundlage (1945-1949)") shall not be reversed.

     The international matters concerning German unification were

agreed upon in negotiations between the two German States and the four

Allied Powers.   In the Treaty of 12 September 1990 on the Final

Settlement with respect to Germany, the sovereignty of a united Germany

was recognised.  In connection with the signing of this Treaty the

Ministers for Foreign Affairs of the former German Democratic Republic

and of the Federal Republic of Germany addressed a Joint Letter

(Gemeinsamer Brief) to the Foreign Ministers of the Four Powers

confirming the property regulation reached in the Joint Declaration of

15 June 1990 and aimed at being incorporated in the Unification Treaty.

     The Act Regulating Unresolved Property Questions (Gesetz zur

Regelung offener Vermögensfragen) of 12 September 1990, as amended in

particular in March 1991, December 1994 and August 1997, reaffirms the

principle that there should be no restitution of property expropriated

on the basis of occupation law or the authority resulting from

occupational power in S. 1 para. 8 (a).  With regard to other

expropriations effected in the German Democratic Republic without

compensation, this Act provides, in principle, for the return of

confiscated property, including businesses, where this is still

possible and does not violate user rights acquired in good faith.  If

a return is excluded compensation has to be paid in accordance with

SS. 6(7) and SS. 9 et seq., while for certain cases mentioned in

S. 4(1) and (2) new legislation was envisaged.

     On 27 September 1994 the Federal German Parliament adopted two

laws regulating the legal consequences of expropriations in the

territory of the former German Democratic Republic in respect of which

the restitution of property was excluded.  Both laws entered into force

on 1 December 1994.  They are the Compensation Act (Entschädigungs-

gesetz) concerning expropriations effected in the German Democratic

Republic after 1949 in respect of which the 1990 Act regulating

unresolved property questions had reserved further legislation; and the

Equalisation Act (Entschädigungs- und Ausgleichsleistungsgesetz)

providing for equalisation payments to natural persons who had been

expropriated on the basis of occupation law or the authority resulting

from occupational power between 1945 and 1949.

     The Federal Constitutional Court, in leading decisions of

23 April 1991 and 18 April 1996, respectively, held that the amendments

to the German Basic Law on the basis of the German Unification Treaty,

including the Joint Declaration, excluding restitution of property

expropriated on the basis of occupation law or the authority resulting

from occupational power, were compatible with Article 79 para. 3 of the

Basic Law concerning the limits to permissible amendments to the Basic

Law.

COMPLAINTS

     The applicants complain that the refusal of the German

authorities, after German unification, to return to them their

unlawfully confiscated property amounts to a breach of Article 1 of

Protocol No. 1 to the Convention. They criticize in particular the

case-law of the Commission, which, even in case of unlawful

expropriation, does not protect the former property rights if they had

not been susceptible of effective exercise for a long period of time.

THE LAW

     The applicants complain that the non-restitution of their

property expropriated on the basis of the authority resulting from

Soviet occupational power between 1945 and 1949 violates their right

to peaceful enjoyment of their possessions under Article 1 of Protocol

No. 1 (P1-1) to the Convention.

     This provision reads as follows:

     "1.   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.

     2.    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 to secure the payment of taxes or other

     contributions or penalties."

     The applicants criticize the Commission's decision of

4 March 1996 concerning Applications Nos. 18890/91, 19048/91, 19049/91,

19342/92 and 19549/92 (D.R. 85-A, p. 5), where similar complaints under

Article 1 of Protocol No. 1 (P1-1) were declared inadmissible.

     The relevant passages of the decision of 4 March 1996 in respect

of the incompatibility ratione personae and ratione temporis of these

complaints read as follows:

     "a)   The Commission first notes that the original deprivation of

     the applicants' property occurred at the instance of the Soviet

     occupying forces in Germany, more than forty years ago, at a time

     when the Federal Republic of Germany did not even exist. Even if

     it is true that, as the Federal Constitutional Court observed in

     its decision of 23 April 1991, the authorities of both German

     States subsequently recognized the validity of the expropriations

     in question, the German authorities can in no way be held

     responsible for the deprivation of property as such, which is not

     imputable to them. In this respect the Commission lacks

     competence, ratione personae, to examine the circumstances in

     which the expropriations were carried out.

     b)    The Commission further observes that the expropriations

     took place before the entry into force of the Convention

     (3 September 1953) and before the ratification of Protocol No. 1

     by the Federal Republic of Germany (13 February 1957). It is true

     that they continued to produce effect after the above dates and

     also after 3 October 1990, when the Unification Treaty entered

     into force and when the territory where the property concerned

     was situated became part of the Federal Republic of Germany to

     which the Convention and its Protocols are applicable. However,

     the Commission recalls its constant case-law according to which

     a deprivation of ownership or other rights in rem is in principle

     an instantaneous act and does not produce a continuing situation

     of 'deprivation of right' (cf. No. 7742/76, Dec. 4.7.78, D.R. 14,

     p. 146)."

     The Commission, in the light of the Court's Loizidou v. Turkey

(Merits) judgment of 18 December 1996 (Reports of Judgments and

Decisions 1996, p. 2215, para. 41) which concerned a continuous denial

of access to property in northern Cyprus, further developed this

reasoning in a subsequent case concerning a similar expropriation. The

relevant part of this decision (No. 19918/92, Dec. 24.2.97,

unpublished) reads as follows:

           "In the case of Loizidou v. Turkey, there was, from the

     outset, an interference with property rights in breach of

     Article 1 of Protocol No. 1 (P1-1), engaging the responsibility

     of Turkey, which also was held responsible for a continuing

     violation of the said provision on account of the complete

     negation of Mrs Loizidou's property rights in the form of a total

     and continuous denial of access and a purported expropriation

     without compensation (cf. Loizidou (Merits) judgment, op. cit.,

     paras. 48-64).

           In the present case, the deprivation of the applicant's

     property occurred at the instance of the Soviet occupying forces

     in Germany at a time when the Federal Republic of Germany had not

     yet been established and the Convention as well as Protocol No. 1

     had not yet entered into force. Between 1945 and 1949 there could

     not be any interference with property rights in breach of

     Article 1 of Protocol No. 1 (P1-1) which could entail the

     responsibility of the Federal Republic of Germany and give rise

     to a continuing violation."

     As regards the incompatibility ratione materiae of the

above-mentioned complaints, the relevant passages of the decision of

4 March 1996, as confirmed in the decision of 24  February 1997, read

as follows:

     "c)   The applicants claim that the regulations of the

     Unification Treaty interfered with their rights under Article 1

     of Protocol No. 1 (P1-1) because in their submission they

     retained an entitlement to the property in question, the

     expropriations carried out between 1945 and 1949 having allegedly

     been effected contrary to the rules of public international law.

     In this respect the question arises whether the international

     instruments governing the behaviour of belligerent States, such

     as the Hague Convention on the Laws and Customs of War, can be

     invoked by individuals with reference to acts performed

     subsequent to the end of hostilities. Doubts also exist in regard

     to the question whether an act allegedly performed in violation

     of the Hague Convention must be deemed null and void, or whether

     it merely obliges the State responsible to pay compensation where

     appropriate.

           However that may be, in any event the applicants could not

     claim to be victims of a violation of their rights under

     Article 1 of Protocol No. 1 (P1-1) unless the measure complained

     of affected their 'possessions' or their 'property' within the

     meaning of this provision. A person complaining of an

     interference with his property must show that such right existed

     (No. 7694/76, Dec. 14.10.77, D.R. 12, p. 131).

           In this respect, the Commission recalls the constant case-

     law of the Convention organs according to which "possessions" may

     be either 'existing possessions' (cf. Eur. Court HR, Van der

     Mussele v. Belgium judgment of 23 November 1983, Series A no. 70,

     p. 23, para. 48) or valuable assets, including claims, in respect

     of which the applicant can argue that he has at least a

     "legitimate expectation" that they will realise (cf. Eur. Court

     HR, Pine Valley Developments Ltd and Others v. Ireland judgment

     of 29 November 1991, Series A no. 222, p. 23, para. 51, and

     Pressos Compania Naviera S.A. and Others v. Belgium judgment of

     20 November 1995, Series A no. 332, p. 21, para. 31). By

     contrast, the hope of recognition of the survival of a former

     property right which has not been susceptible of effective

     exercise for a long period (Nos. 7655-7657/76, Dec. 4.10.77,

     D.R. 12, p. 111) or a conditional claim which has lapsed as a

     result of the non-fulfilment of the condition (No. 7775/77,

     Dec. 5.10.78, D.R. 15, p. 143) are not to be considered as

     'possessions' within the meaning of Article 1 of Protocol No. 1

     (P1-1).

           It is clear that the present case does not concern any

     'existing possessions' of the applicants. The applicants'

     properties were expropriated a long time ago and the applicants

     have been unable for decades to exercise any owners' rights in

     respect of the property concerned. Despite the applicants' claim

     that the expropriations were contrary to international law and

     thus unlawful, it appears that in the German legal order these

     expropriations were being considered as legally valid even before

     the conclusion of the Unification Treaty. The provisions of the

     Treaty cannot therefore be seen as legalising the deprivation of

     the applicants' property and thereby as being the source of the

     deprivation for the purposes of German law.

           It remains to be examined whether the applicants could have

     any 'legitimate expectation' to realise claims, either based on

     a right to compensation for the loss of their property which

     continued to exist until the entry into force of the Unification

     Treaty and was affected thereby, or created by the fact that

     public-law bodies of the Federal Republic of Germany acquired

     part of the expropriated estates by virtue of the unification.

           As regards any possible compensation claim generated by the

     loss of the property, the Commission refers to its constant

     jurisprudence according to which it is not competent ratione

     temporis and ratione materiae to examine complaints relating to

     the refusal or denial of compensation claims based on facts that

     occurred prior to the entry into force of the Convention with

     respect to the State concerned (cf. No. 7694/76, Dec. 14.10.77,

     D.R. 12, p. 131; No. 7742/76, Dec. 4.7.78, D.R. 14, p. 146). The

     Commission would add with regard to the particular facts of the

     present case that the Federal Republic of Germany was not

     responsible for the expropriations in question and that therefore

     any compensation claims which might have existed prior to the

     Unification Treaty would not have been directed against that

     State.

           As regards the existence of any claim based on the fact

     that, in consequence of the unification, part of the property

     concerned passed into the hands of public-law bodies of the

     Federal Republic of Germany, the Commission notes the Federal

     Constitutional Court's finding that despite this fact there

     existed no claim under German law for the restitution of the

     available properties and that this situation was, from the

     viewpoint of constitutional law, unobjectionable. There is

     nothing to show that this finding is arbitrary and incompatible

     with the applicable provisions. In particular it does not appear

     that the Federal Constitutional Court's conclusion was based on

     the Unification Treaty itself and that, without the provisions

     of that Treaty, the situation under German constitutional law

     would have been judged otherwise. Therefore it cannot be said

     that the Treaty interfered with any pre-existing legal position

     of the applicants in this respect either.

           It follows that the applicants had no 'existing

     possessions' nor any legally recognized compensation claims when

     the Unification Treaty came into force. In these circumstances

     it cannot be found that the regulation of property questions in

     the Unification Treaty amounted to an interference with any

     rights of the applicants under Article 1 of Protocol No. 1

     (P1-1)."

     The Commission finds that the arguments advanced by the

applicants in the present case do not justify any other conclusions.

     The applicants mainly submit that the expropriation carried out

between 1945 and 1949 was unlawful both under public international law

and under the law of the Federal Republic of Germany.  They therefore

consider that they retained an entitlement to the property in question

and that the Federal Republic of Germany unlawfully refused restitution

of this property as well as adequate compensation.  In their view, the

Commission's line of reasoning, in its decision of 4 March 1996, namely

that former property which has not been susceptible of effective

exercise for a long period is not covered by the notion of

"possessions", would amount to recognising any unlawful situation on

the basis that it has lasted for a long period.

     The Commission observes that the question of the unlawfulness of

the expropriation measures in 1945 is not within its jurisdiction

ratione temporis.  Having occurred before the entry into force of the

Convention, these measures could not, therefore, give rise to a

continuing breach of the Convention with effect as to the temporal

limitation of the competence of the Convention organs (cf. Eur. Court

HR, Loizidou judgment, op. cit. p. 2230, para. 41; Papamichalopoulos

v. Greece judgment of 24 June 1993, Series A no. 260-B; p. 69,

para. 40).

     The notion of "possessions", pursuant to Article 1 of Protocol

No. 1 (P1-1), refers to "existing possessions" or "legitimate

expectations".

     In the present circumstances, where the Commission is not

competent to examine the lawfulness of the initial expropriation

measures which were regarded as legally valid by the German

authorities, the fact that, for a period of 45 years, the applicants

had no factual possibility to exercise any powers or control regarding

these estates is decisive for the purposes of Article 1 of Protocol

No. 1 (P1-1). In 1990 the expropriated estate did not, therefore, form

part of the applicants' "existing possessions".

     Furthermore, given the facts that the applicants had not been

able to exercise any ownership rights in respect of the property

concerned for more than forty years and did not have any legally

recognised compensation claim at the time of the conlusion of the

German Unification Treaty, they could not have had, at that time, any

"legitimate expectation" of obtaining restitution or full compensation.

As regards the applicants' further submission that the Government of

the Federal Republic of Germany had given an assurance that, in case

of unification of Germany, the expropriated properties would be

restored, the Commission finds that political statements do not create

any "legitimate expectation" of obtaining restitution.  In this

respect, the Commission notes that the German legislator had regard to

other relevant factors such as events which occurred subsequent to the

expropriations, the possible acquisition of vested rights by third

persons, and the public interest.  Moreover, the Greifswald

Administrative Court, in the light of the case-law of the Federal

Constitutional Court, carefully examined the applicants' submissions,

including their contention that Soviet preconditions for German

unification, as invoked by the German Government, had never existed.

The German courts' reasoning does not disclose any appearance of

arbitrariness.

     Therefore, there is no indication of a violation of Article 1 of

Protocol No. 1 (P1-1).

     It follows that the application must be rejected in accordance

with Article 27 para. 2 (Art. 27-2) of the Convention.

     For these reasons, the Commission, by a majority,

     DECLARES THE APPLICATION INADMISSIBLE.

  M.F. BUQUICCHIO                              M.P. PELLONPÄÄ

     Secretary                                    President

to the First Chamber                         of the First Chamber