THIRD SECTION

DECISION

AS TO THE ADMISSIBILITY OF

Application no. 77207/01 by Rolf SENKPIEL against Germany

The European Court of Human Rights (Third Section), sitting on 12 January 2006 as a Chamber composed of:

Mr B.M. Zupančič , President , Mr J. Hedigan , Mr L. Caflisch , Mr C. Bîrsan , Mr V. Zagrebelsky , Mrs A. Gyulumyan , Ms I. Ziemele, judges , and Mr V. Berger , Section Registrar ,

Having regard to the above application lodged on 25 October 2001 ,

Having deliberated, decides as follows:

THE FACTS

The applicant, Mr Rolf Senkpiel , is a German national who was born in 1929 and lives in Berlin . He was represented before the Court by Mr Lothar Rilinger, a lawyer practising in Hannover .

A. The circumstances of the case

The facts of the case, as submitted by the applicant, may be summarised as follows.

1. Background to the case

After German reunification, the German Parliament sought to achieve a fair balancing of interests between former owners of land in the GDR who had been expropriated and those who had subsequently used and purchased these lands. Purchase agreements which were concluded prior to German reunification were very often not executed (so-called hängende Kaufverträ g e ) and the purchasers were consequently never registered in the land register. In many instances, this was not their fault, as the failure to register such purchasers was due to the land registries being overburdened.

In order to resolve conflicts in a socially acceptable way and to achieve an enduring legal order in Germany, the German Parliament decided in principle to restore the property to the former owners in accordance with the Resolution of Outstanding Property Issues Act/Property Act ( Gesetz über die Regelung offener Vermögensfragen / Vermögensgesetz ) of 23 September 1990. For those who ha d rented the property before 18 October 1989 and continued to live there on 1 October 1994 and who had purchased the property before 15 June 1990 , the German legislator introduced Section 121 § 2 Law of Property Revision Act ( Sachenrechtsbereinigungsgesetz ). This provision entitles the user and purchaser to buy the property in question. If the owner refuses to sell the restored land, the user is entitled to compel him to make an offer for sale. In this instance, the content of such an offer is laid down in the Law of Property Revision Act. The German legislator chose 15 June 1990 as the end of the period for the entitlement of users of land: on the above date, the two German Governments issued a j oint declaration on the determination of unresolved property issues ( Gemeinsam Erklärung der Bundesrepublik Deutschland und der deutschen Demokratischen Republik zur Regelung offener Vermögensfragen ).

2. Proceedings before the domestic courts

The applicant had owned a plot of land with a one-family house which was situated in the State Brandenburg , on the terr itory of the German Democratic R epublic (GDR). When he left the GDR in 1953, the land was seized and became State-owned property.

A couple, Mr and Mrs Sprenger, rented one of the flats in the house in 1963, and, in 1991, rented the whole building. On 1 June 1990 , the couple concluded a purchase agreement regarding the land with the Potsdam County Assembly. The contract was not executed and the couple was never registered in the land register. In 1993, the ownership of the land was restored to the applicant who was registered as the owner in the land register on 12 June 1996 in accordance with the Resolution of Outstanding Property Issues Act/Property Act of 23 September 1990 .

The couple subsequently sued the applicant for a declaration that they were entitled as users and purchasers of the plot of land in accordance with the Law of Property Revision Act. The applicant filed a counter-claim regarding the rent for the building.

In a declaratory j udgment of 28 August 1996 , the Potsdam Regional Court allowed the couple ’ s claim and dismissed the applicant ’ s counter-claim. The court found that Section 121 § 2 of the Law of Property Revision Act did not violate the applicant ’ s right to property. Even though there had been an interference with that right, the legal situation did not amount to an expropriation. It merely constituted a measure of control of the use of property which served a legitimate aim, namely the balancing of competing interests of the former owners of land and of its subsequent users, and it was proportionate. Moreover, the German Parliament had not overstepped its margin of appreciation in this respect. The Potsdam Regional Court acknowledged that for ordinary citizens the domestic law might be difficult to comprehend but that that circumstance did not lead to the unconstitutionality of the provision concerned: whereas the Resolution of Outstanding Property Issues Act/Property Act served as a compensation for in j ustices which occurred prior to German reunification, the Law of Property Revision Act fulfilled the complex task to find an appropriate balance of competing interests between former owners and subsequent users of land.

On appeal by the applicant, the j udgment of the Potsdam Regional Court of 28 August 1996 was quashed on 24 July 1997 by the Brandenburg Court of Appeal, and the couple ’ s claim was dismissed. The Brandenburg Court of Appeal allowed the applicant ’ s counter-claim. It did however not rule upon the question of whether or not Section 121 § 2 of the Law of Property Revision Act was constitutional. It quashed the j udgment because one of the prerequisites of Section 121 § 2, a valid purchasing agreement with a GDR authority, had not been met by the couple. The court found that on 1 June 1990 , at the time of the conclusion of the purchase agreement, the other contracting party -the Potsdam County Assembly-, had ceased to exist due to the introduction of a new constitution for the local authorities on 17 May 1990 . The newly-founded local authority could not be considered as the legal successor to the Potsdam County Assembly.

On appeal on points of law by the plaintiffs, the Federal Court of Justice on 26 March 1999 quashed the j udgment of the Brandenburg Court of Appeal on 24 July 1997 and dismissed the applicant ’ s appeal. Even though the Federal Court of Justice found that the Potsdam County Assembly had ceased to exist and that the newly-founded local authority could not be considered as its legal successor, it held that the contract was binding on the newly-founded local authority in accordance with the relevant provisions of the Introductory Act to the German Civil Code ( Einführungsgesetz zum Bürgerlichen Gesetzbuche ). Moreover, the Federal Court of Justice found that Section 121 § 2 of the Law of Property Revision Act was constitutional.

The Federal Constitutional Court , after having considered statements by the Federal Ministry of Justice, the Brandenburg Ministry of Justice and European Affairs and the Saxonian Ministry of Justice, refused to admit the applicant ’ s constitutional complaint on 16 May 2001 . It found that Section 121 § 2 of the Law of Property Revision Act was constitutional and did not amount to a violation of the applicant ’ s right to property under Article 14 of the German Basic Law ( Grundgesetz ). The Federal Constitutional Court reasoned that Section 121 § 2 of the Law of Property Revision Act did not constitute an expropriation but an admissible measure of control imposed on the use of property which served a legitimate aim, namely to avoid hardship for the users and purchasers of the plots of land which in principle were to be restored to their former owners. By finding a socially acceptable balance between competing interests, and while taking into account the need for legal certainty and clarity and for furthering equal economic opportunities after the German reunification, the Federal Constitutional Court stated that the relevant provisions did not only serve the interest of a few individuals, but that of the public in general. The Federal Constitutional Court also found that the German Parliament had en j oyed a margin of appreciation in solving the conflict of interests between former owners and users of the plots of land. This margin had not been overstepped by the relevant provisions of the Law of Property Revision Act. Moreover, the applicant, whose property had been restored prior to the entry into force of the Law of Property Revision Act, was not protected by confidence in the present case. The German legislator had included in 1992 a moratorium in the Introductory Act to the German Civil Code which concerned users who had bought buildings but whose purchase agreements had not been executed. Whether or not the applicant ’ s case would come within the moratorium was for the ordinary courts to decide, but the Federal Constitutional Court held that, in view of this moratorium, the applicant should have been aware at the time of his entry into the land register in 1996 that his position as owner was likely to be affected by future regulations. The outstanding public demand for legal certainty and clarity regarding the issue would have in any case outweighed any such confidence.

As to date, the applicant remains the owner of the plot of land and is still registered as such. However, he is currently negotiating the purchase price of the land with the couple.

B. Relevant domestic law

With regard to tenancies concluded in the former GDR for houses or buildings which after German reunification were returned to their former owners pursuant to the Resolution of Outstanding Property Issues Act/Property Act, the Law of Property Revision Act provides as follows:

According to Section 121 § 2 in con j unction with Sections 15, 19, 61, 65-74 and 121 § 1 of the Law of Property Revision Act, a person who had bought a house or building before 14 June 1990 through a valid purchasing agreement with an authority of the GDR, provided he/she had previously rented the building before 18 October 1989 and continued to live there on 1 October 1994, he/she is entitled to certain rights under the Act. As relevant in the present context, the person is entitled to buy the plot of land. If the owner refuses to sell it, Section 61 of the Act entitles the user to sue the owner to make an offer for sale. The content of such an offer is laid down in Sections 65 to 74 of the Act. According to Section 68 § 1 of the Act, the purchase price amounts in general to half of the value of the plot of land.

COMPLAIN T

The applicant complained under Article 1 of Protocol No. 1 that Section 121 § 2 of the Law of Property Revision Act infringed his right to the peaceful en j oyment of his possessions. He states that the above provision amounts to an expropriation and not merely a measure to control the use of property. Under the applicable law, the owner of the land could be compelled by its user to sell it. The provision did not serve the public interest as it merely furthered the interests of a few private individuals, i.e. the users of the plots of land. After the applicant had acquired full ownership of the land by means of the 1990 Resolution of Outstanding Property Issues Act/Property Act, he could not foresee that he would later be compelled to give up his ownership by means of the 1994 Law of Property Revision Act.

THE LAW

The applicant complained that Section 121 § 2 (read in con j unction with Sections 15, 19, 61, 65-74 and 121 § 1) of the Law of Property Revision Act infringed his right of property, as guaranteed by Article 1 of Protocol No. 1, which provides:

“Every natural or legal person is entitled to the peaceful en j oyment of his possessions. No one shall be deprived of his possessions except in the public interest and sub j ect 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.”

The Court recalls that Article 1 of Protocol No. 1, which guarantees in substance the right of property, comprises three distinct rules (see James and Others v. the United Kingdom , j udgment of 21 February 1986, Series A no. 98, pp. 29-30, § 37). The first, which is expressed in the first sentence of the first paragraph and is of a general nature, lays down the principle of peaceful en j oyment of property. The second rule, in the second sentence of the same paragraph, covers deprivation of possessions and sub j ects it to certain conditions. The third, contained in the second paragraph, recognises that the Contract ing States are entitled, among other things, to control the use of property in accordance with the general interest. The second and third rules, which are concerned with particular instances of interference with the right to peaceful en j oyment of property, must be construed in the light of the general principle laid down in the first rule (see, among other authorities, Iatridis v. Greece [GC], no. 31107/96, § 55, ECHR 1999-II).

1. Whether there was interference

As to whether there was interference, the Court notes that the applicant is the owner of the plot of land since his entry into the land register in 1996. Accordingly, it considers that the present dispute should be examined under the first sentence of Article 1 of Protocol No. 1 (see, mutatis mutandis , Wittek v . Germany , j udgment of 12 December 2002, Judgments and Decisions 2002-X, § 44; Českomoravská myslivecká j ednota v. the Czech Republic (dec.), no. 33091/96, 23 March 1999, and Teuschler v. Germany (dec.), no. 47636/99, 4 October 2001). In its declaratory j udgment of 28 August 1996, the Potsdam Regional Court held that the couple who had been living in the one-family house on the land since 1963 was entitled under Section 121 § 2 the Law of Property Revision Act, inter alia , to ask the applicant to sell the land by purchase agreement. If the applicant refused to do so, the content of the offer was laid down in Sections 65 to 74 of the Act. The above declaratory j udgment was confirmed by the Federal Court of Justice and the Federal Constitutional Court and is inalterable. Even though the applicant has remained the owner of the plot as to date, he was compelled by the applicable law and the above court decisions to give up his possession and sell the land to third persons. Consequently, there has been an interference with the applicant ’ s right to the peaceful en j oyment of his possessions.

2. Justification of the interference

As to whether the interference was prescribed by and in accordance with the national law, the Court notes that it was based on the provisions of the Law of Property Revision Act, which are precise and accessible to all.

Furthermore, the deprivation must be in the public interest. To meet this requirement, a measure depriving a person of his property must not only pursue, on the facts as well as in principle, a legitimate aim “in the public interest”, but there must also be a reasonable relationship of proportionality between the means employed and the aim sought to be realised (see James and Others , cited above, § 50).

As regards the purpose of the interference, the Court considers that a deprivation of property effected for no reason other than to confer a private benefit on a private party cannot be “in the public interest”. Nonetheless, the compulsory transfer of property from one individual to another may, depending on the circumstances, constitute a legitimate means for promoting the public interest (see the case of James and O thers cited above , § 40). The Court finds that a taking of property effected in pursuance of legitimate social, economic or other policies may be “in the public interest”, even if the community at large has no direct use or en j oyment of the property taken ( James and O thers cited above , § 45). Section 121 § 2 of the Law of Property Revision Act, which was intended to resolve property disputes following German reunification between the former owners and the users of plots of land which were sub j ect to redistribution in accordance with the Resolution of Outstanding Property Issues Act/Property Act, pursued an aim that was in the general interest. Given that the German legislator introduced the relevant provisions in the Law of Property Revision Act in order to promote legal certainty and clarity after the German reunification, it cannot be said that those provisions did only serve the interest of a few individuals. The Court finds that these provisions serve the public interest in general.

Moreover, the Court has to consider whether the interference was proportionate. There must be a reasonable relationship of proportionality between the means employed and the aim sought to be realised by any measure depriving a person of his possessions. The Court must examine in particular whether the contested measure strikes the requisite fair balance between the demands of the general interest of the public and the requirements of the protection of the individual ’ s fundamental rights, and whether it imposes a disproportionate and excessive burden on the applicant (see, among other authorities, Jahn and O thers v . Germany [GC], j udgment of 30 June 2005, § 93, ECHR 2005-). Taking into account the historical context in which the present conflict arose, the Court recognises that the German legislator faced an exceptionally difficult exercise in having to balance the gains and losses of the persons affected by the process of transforming the former GDR ’ s economy and legal system after reunification. Under these circumstances, a wide margin of appreciation should be accorded to the respondent State, even though the exercise of the State ’ s discretion cannot entail consequences which are at variance with Convention standards (see, mutatis mutandis , Broniowski v . Poland , j udgment of 22 June 2004, § 182, Judgments and Decisions 2004-V).

In the present case, the Court notes that the German legislator sought to establish a fair balance between two competing interests: on the one hand the interest of former owners of plots of land who had been unlawfully expropriated in the former GDR and whose property was restored after German reunification, and, on the other hand, the users of the land who had bought the land prior to German reunification but who had never been registered in the land register because the purchase agreement had never been executed. Through the introduction of Section 68 § 1 into the Law of Property Revision Act the German Parliament ensured that the purchase price of the plot of land would amount to half of the value of the plot. Section 68 § 1 of the Law of Property Revision Act was therefore a safeguard for a purchase price that would be at least reasonably related to the market value of the land and a guarantee for not placing an excessive burden on the owner of the land. The Court finds that, in situations such as that of the present case, the choice of measures for the legislator may necessarily have involved decisions restricting compensation for the taking or restitution of property to a level below its market value (see, mutatis mutandis , Broniowski v . Poland , cited above, § 182). By not giving full priority to either side, the German legislator eventually granted each side one half of the market value of the land.

The Court considers that the Potsdam Regional Court elaborated in detail on the fact that the applicant was at first restored only to be subsequently compelled by law to sell his property to third persons. It explained that this was due to interactions between two complex laws which served different purposes. The Resolution of Outstanding Property Issues Act/Property Act provided in principle for the compensation of in j ustices which occurred prior to German reunification, while the Law of Property Revision Act served the complex task to reconcile the competing interests between former owners and the subsequent users of the land. The Court notes that the German legislator opted for an interaction between these two laws in order to avoid an “all or nothing”-situation for either group concerned.

After reunification, the German legislator was forced to decide who of the two sides should be given priority as owner of the land, while the other would receive the agreed or legally prescribed and mandatory purchase price as compensation. Taking this element into account, it cannot be said that the German legislator struck an unfair and unreasonable balance by giving priority to those who had used the lands and in many cases maintained the buildings upon them for a considerable amount of time. The Court finds that the present case, in which the applicant had left the GDR in 1953 and in which the couple had been renting at least parts of the house on the land in question for more than four decades since 1963, eloquently illustrates this point. The Court also notes that, in most instances, the users who had purchased the lands were not registered in the land register for reasons which were generally not attributable to them.

Moreover, it is not for the Court to say whether the legislation under consideration was the best solution for dealing with the problem or whether the legislative discretion should have been exercised in another way, as long as the legislator has remained within the bounds of the legitimate aim pursued and of the need to strike a fair balance (see, mutatis mutandis , James and O thers cited above, § 45 ). Having regard to the above considerations and , in particular, to the unique context of German reunification, the Court considers that the respondent State has not overstepped its margin of appreciation and, in view of the legitimate aim pursued, has sought to strike a “fair balance” between the applicant ’ s interest and the general interest of German socie ty in a way that cannot be characterised as manifestly unreasonable. Accordingly, the applicant cannot be regarded as having borne a “disproportionate burden”.

There has therefore been no violation of Article 1 of Protocol No. 1.

For these reasons, the Court unanimously

Declares the application inadmissible.

Vincent Berger Bošt j an M. ZupanČ i Č Registrar President