FIRST SECTION

FINAL DECISION

AS TO THE ADMISSIBILITY OF

Application no. 32957/96 by Franz, Elisabeth and Georg KÖTTERL and Barbara SCHITTILY against Austria

The European Court of Human Rights (First Section), sitting on 9 January 2003 as a Chamber composed of

Mr C.L. Rozakis , President , Mrs F. Tulkens , Mr G. Bonello , Mr E. Levits , Mrs S. Botoucharova , Mr A. Kovler , Mrs E. Steiner , judges ,

and Mr S. Nielsen , Deputy Section Registrar ,

Having regard to the above application lodged with the European Commission of Human Rights on 12 March 1996,

Having regard to Article 5 § 2 of Protocol No. 11 to the Convention, by which the competence to examine the application was transferred to the Court,

Having regard to the partial decision of 5 September 2000,

Having regard to the observations submitted by the respondent Government and the observations in reply submitted by the applicant,

Having deliberated, decides as follows:

THE FACTS

The applicants, Franz, Elisabeth and Georg Kötterl and Barbara Schittily are German nationals, born in 1953, 1923, 1956 and 1958 respectively, and live in Germany. They were represented before the Court by Mr A. Feichtner , a lawyer practising in Kitzbühel (Austria).

A. The circumstances of the case

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

On 28 September 1973 the applicants’ father or husband, respectively, concluded a “tenancy, option to purchase and mortgage agreement” ( Miet -, Options- und Pfandbestellungsvertrag ) with the owner of an apartment in Jochberg (Tyrol). According to this agreement its duration was to be 100 years, the rent was ten Austrian schilling per year and was considered as having already been paid as part of the contribution to the costs of construction. The tenancy contract automatically extended to future heirs. The owner would accept any successor named by the other party or its heirs as tenant. Furthermore, the owner granted him a right to pre-emption and an option to purchase the apartment to which he was bound for the duration of the contract. The price was fixed and in case of purchase would be set off against the contribution to the construction costs. Subsequently this agreement was entered in the Land Register ( Grundbuch ).

In 1993 the Real Property Transactions Officer filed an action with the Innsbruck Regional Court ( Landesgericht ) against the applicants, the heirs to their father or husband who had died in the meantime, requesting the court to declare void ( Feststellung der Nichtigkeit ) the “tenancy, option to purchase and mortgage agreement” of 1973.

On 4 August 1994 the Regional Court declared the agreement void. It found that the intention of the parties when concluding the contract of 1973 had been to transfer a status tantamount to that of an owner on the applicants’ father, as was apparent from the conditions set out in the contract although it had the form of a tenancy agreement. In view of the number of foreign land owners in Jochberg , the real property transaction authorities would not have given their consent to a sales contract. The contract of 1973 was therefore a sham and had to be declared void under Section 879 of the Civil Code, which provides that a contract concluded in violation of a prohibition established by law is void.

Upon the applicants’ appeal, on 28 February 1995, the Innsbruck Court of Appeal ( Oberlandesgericht ) confirmed the Regional Court’s judgment. On 10 April 1995 the applicants filed a further appeal on points of law ( Revision ) with the Supreme Court ( Oberster Gerichtshof ) in which they argued that the power of the Real Property Transaction Officer to request the courts to declare void contracts which had been concluded many years ago violated their rights under Article 1 of Protocol No. 1 as the declaration by the Regional Court constituted a disproportionate interference with a legal position they had enjoyed over many years. Furthermore, they argued that the 1991 amendment to the Real Property Transaction Act had not been properly published and was therefore unconstitutional.

On 27 June 1995 the Supreme Court dismissed the applicants’ further appeal. It found that the 1991 amendment had been properly published and that there was no reason for applying to the Constitutional Court ( Verfassungsgerichtshof ) for a review of the constitutionality of that amendment. It also had no doubts about the constitutionality of Section 16a of the Real Property Transactions Act as nobody could expect that a status acquired by an unlawful act could become one protected by the law in the future. The fact that the Real Property Transaction Officer could file actions against sham contracts which had been concluded long ago did not interfere with acquired rights ( wohlerworbenen Rechten ), the only limit being prescription after thirty years.

On 20 September 1995, after the Supreme Court had given its above decision, another chamber of that court decided that the right of the Real Property Transactions Officer to request a declaratory decision applied only to transactions that were effected after 1988. If this right extended to previous transactions, that provision would be unconstitutional. On 10 December 1996 the Constitutional Court declared unconstitutional the 1991 amendment to the Real Property Transactions Act, which established the Real Property Transactions Officer’s powers, because it considered that this amendment had not been published as required by the relevant law.

B. Relevant domestic law

Under the Tyrol Real Property Transactions Act 1970 ( Grundverkehrsgesetz ), a contract concerning the transfer of ownership over real property was subject to approval by the Real Property Transaction Commission if agricultural and forestry land was concerned or if the purchaser did not possess Austrian nationality (Section 1 and 3). Such a contract could only take effect if it was approved by the real property transaction authorities (Sections 3 and 16). The purchaser of land was obliged to seek approval of the contract within two months (Section 15 § 1). If approval was withheld, the acquisition was null and void (Section 16 § 1). The conclusion of a tenancy did not require such consent, neither did an acquisition under a will.

According to an amendment to the Real Property Transactions Act of 28 November 1973, Regional Law Gazette No. 6 of 1974, which entered into force on 1 January 1994, tenancy agreements concluded with a foreigner could only be entered in the Land Register after the Real Property Transaction Commission had given its consent.

A further amendment to the Real Property Transactions Act of 3 July 1991 enabled the Real Property Transactions Officer to request a court decision declaring void a contract which constituted a circumvention of the requirement of consent under that Act (Section 16a). This right of the Real Property Transaction Officer also related to transactions which had been concluded before that amendment entered into force (Article II § 4).

COMPLAINTS

The applicants complain under Article 1 of Protocol No. 1 that the decisions of the Austrian courts declaring void the 1973 tenancy contract violated their right to property. The decisions at issue amounted to an expropriation which was not justified by any public interest, was disproportionate and arbitrary.

The applicants also complain that the provisions of the Tyrol Real Property Transaction Act violated the right to equal treatment as it made an unfair distinction between Austrian citizens and foreigners. They invoke Article 14 of the Convention.

THE LAW

1 . The applicants complain under Article 1 of Protocol No. 1 that the decisions of the Austrian courts declaring void the “tenancy, option to purchase and mortgage agreement” of 1973 violated their right to property.

The relevant part of Article 1 of Protocol No. 1 provides 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 Government submit that the applicants did not have a possession within the meaning of Article 1 Protocol No. 1. The “tenancy, option to purchase and mortgage agreement” of 1973 was a contract which had been concluded with the intention to circumvent the applicable laws on real estate transactions. Such a contract was invalid and had therefore been declared void by the Austrian courts. It cannot, therefore be considered a “possession” within the meaning of Article 1 Protocol No. 1.

But even considering the 1973 agreement a “possession” within the meaning of that provision, the interference with that position by the Austrian courts was justified. The interference was in accordance with the conditions provided for by law, namely the relevant provisions of the Real Estate Transaction Act, and it struck a fair balance between the applicants’ interest in having a holiday apartment in Tyrol and the public interest in allocating efficiently the scarce building land which exists in that region.

This is disputed by the applicants. They submit that their predecessor, who had concluded the contract at issue, had no intention to circumvent the provisions of Austrian law on the acquisition of real property but merely had chosen a legal solution which was in accordance with the law at the time the contract had been concluded. Thus, on the basis of that contract, they were the lawful holders of a possession within the meaning of Article 1 Protocol No. 1. The decisions by the Austrian courts which declared that contract void violated their right to peaceful enjoyment of their possession. It was not in accordance with the conditions provided for by law as the courts wrongly considered the 1973 agreement a sham transaction and the scarcity of building land in the Tyrol was also not a persuasive argument as the apartment at issue and the other apartments in the same building were holiday homes.

As the Court has stated on a number of occasions, Article 1 of Protocol No. 1 comprises three distinct rules: “the first rule, set out in the first sentence of the first paragraph, is of a general nature and enunciates the principle of the peaceful enjoyment of property; the second rule, contained in the second sentence of the first paragraph, covers deprivation of possessions and subjects it to certain conditions; the third rule, stated in the second paragraph, recognises that the Contracting States are entitled, amongst other things, to control the use of property in accordance with the general interest. The three rules are not, however, ‘distinct’ in the sense of being unconnected. The second and third rules are concerned with particular instances of interference with the right to peaceful enjoyment of property and should therefore be construed in the light of the general principle enunciated in the first rule” ( Beyeler v. Italy [GC], no. 33202/96, ECHR 2000-I, § 98).

The Court recalls further that the concept of “possessions” in the first part of Article 1 has an autonomous meaning which is independent from the formal classification in domestic law ( Beyeler v. Italy [GC], op.cit . § 100). The issue that needs to be examined is whether the circumstances of the case, considered as a whole, conferred on the applicants title to a substantive interest protected by Article 1 of Protocol No. 1 ( Former King of Greece and Others v. Greece , no. 25701/94, ECHR 2000-XII, § 60; Zwierzynski v. Poland, no 34049/96, § 63, 19 June 2001). In this respect the Court recalls that Article 1 of Protocol No. 1 aims at securing the peaceful enjoyment of existing possessions and that it does not guarantee a right to acquire property nor a right to restitution of property ( Futro v. Poland ( dec ), no. 51832/99, 12. December 2000 with further references).

The applicants emphasise that they were lawful possessors of the apartment at issue under the 1973 “tenancy, option to purchase and mortgage agreement” and that their predecessor had no intention whatsoever to circumvent the provisions of Austrian law on the acquisition of real property. The Court observes, however, that this contract was declared void by the Austrian courts as they considered that it had been concluded with the intention to circumvent the relevant provisions of the Real Property Transaction Act as in force at the time. Having regard to the fact that the Court in its partial decision on admissibility of 5 September 2000, declared inadmissible as being manifestly ill-founded the applicants’ complaint under Article 6 of the Convention about the alleged unfairness of the proceedings before the Austrian courts, the Court considers that the findings of the Austrian courts according to which the 1973 agreement was void, must be the basis of its assessment of the relevant facts.

Thus, the Court finds that such a contract which by the domestic authorities in proceedings which satisfy the requirements of Article 6 § 1 of the Convention has been considered as a circumvention of the law in force, does not confer on the applicants a position which can be considered a possession within the meaning of Article 1 § 1 of the Convention and, thereby, attracts protection by that provision. In this context the Court also observes that the result of the Austrian courts’ decision to annul the 1973 agreement was not that they lost automatically all expenses made by their predecessor in the context of the conclusion of the agreement but that each party to that agreement was entitled to claim back all what had been transferred to the other contracting party.

The Court concludes that the applicants have not shown that they had a “possession” within the meaning of Article 1 of Protocol No. 1.

It follows that this part of the application is incompatible ratione materiae with the provisions of the Convention within the meaning of Article 35 § 3 and must be rejected in accordance with Article 35 § 4.

2. The applicants further complain that the provisions of the Tyrol Real Property Transaction Act violated the right to equal treatment as it made an unfair distinction between Austrian citizens and foreigners. They invoke Article 14 of the Convention which reads as follows:

“The enjoyment of the rights and freedoms set forth in [the] Convention shall be secured without discrimination on any ground such as sex, race, colour, language, religion, political or other opinion, national or social origin, association with a national minority, property, birth or other status.”

The Government submit in the first place that the applicants had not been subject to difference in treatment on account of their nationality. The only measure which had actually affected them was the decision of the Austrian courts to declare void the contract of 1973. A request for declaration of invalidity of a sham contract may be filed in all cases where an approval by the Real Estate Transaction Authorities is required irrespective of the nationality of the persons involved in the transaction. The existence of a sham transaction and not nationality is therefore the decisive criterion.

In any event, even considering the substantive provisions of the 1970 Real Property Transaction Act, the difference in treatment between Austrian nationals and foreigners on acquisition of real property are not discriminatory as the difference in treatment has an objective and reasonable justification, as it pursues a legitimate aim, namely to protect the interests of the local population seeking housing accommodation.

The Court recalls that Article 14 complements the other substantive provisions of the Convention and its Protocols. It has no independent existence since it has effect solely in relation to “the enjoyment of the rights and freedoms” safeguarded by those provisions. Although the application of Article 14 does not presuppose a breach of those provisions – and to this extent it is autonomous –, there can be no room for its application unless the facts at issue fall within the ambit of one or more of the latter ( Karlheinz Schmidt v. Germany judgment of 18 July 1994, Series A no. 291-B, p. 32, § 22).

Having regard to its above finding that the applicants did not have a possession within the meaning of Article 1 Protocol No. 1, the Court finds that this provision is inapplicable in the present case. Accordingly, Article 14 cannot apply in the instant case.

It follows that the complaint under Article 1 of Protocol No. 1 taken together with Article 14 is incompatible ratione materiae with the provisions of the Convention within the meaning of Article 35 § 3 and must be rejected in accordance with Article 35 § 4.

For these reasons, the Court unanimously

Declares the remainder of the application inadmissible.

Søren Nielsen Christos Rozakis              Deputy Registrar President