Resolution CM/ResDH(2013)87 Four cases against the Slovak Republic

(Urbarska Obec Trencianske Biskupice, Jenisova, Salus and Sefcikova)

Execution of the judgments of the European Court of Human Rights

(Application No. 74258/01, judgment of 27/11/2007, final on 02/06/2008 & 27/01/2009, final on 27/04/2009

Application No. 58764/00, judgment of 3/11/2009, final on 3/02/2010

Application No. 28697/03, judgment of 3/11/2009, final on 3/02/2010

Application No. 6284/02, judgment of 3/11/2009, final on 3/02/2010)

(Adopted by the Committee of Ministers on 7 May 2013 at the 1170th meeting of the Ministers ’ Deputies)

The Committee of Ministers, under the terms of Article 46, paragraph 2, of the Convention for the Protection of Human Rights and Fundamental Freedoms, which provides that the Committee supervises the execution of final judgments of the European Court of Human Rights (hereinafter “the Convention” and “the Court”),

Having regard to the final judgments transmitted by the Court to the Committee in the above cases and to the violations established;

Recalling the respondent State ’ s obligation under Article 46, paragraph 1, of the Convention to abide by all final judgments in cases to which it is party and that this obligation entails, over and above the payment of any sums awarded by the Court, the adoption by the authorities of the respondent State, where required:

- of individual measures to put an end to violations established and erase their consequences so as to achieve as far as possible restitutio in integrum ; and

- of general measures preventing similar violations;

Having invited the government of the respondent State to inform the Committee of the measures taken to comply with its above mentioned obligation;

Having examined the action report provided by the government indicating the measures adopted in order to give effect to the judgments, including the information provided regarding the payment of the just satisfaction awarded by the Court (in particular in the case of Urbarska Obec Trencianske Biskupice, under the terms of an Article 41 judgment) (see document DH-DD(2012)335E );

Having satisfied itself that all the measures required by Article 46, paragraph 1, have been adopted,

DECLARES that it has exercised its functions under Article 46, paragraph 2, of the Convention in these cases and

DECIDES to close the examination thereof.

Action report

Four cases concerning the compulsory letting of the applicants ’ land and

the subsequent transfer of ownership to their tenants

Introductory cases summary

The case of Urbárska Obec Trenčianske Biskupice concerns violations of the right to the peaceful enjoyment of possessions of the applicant, a registered association of landowners (violation of Article 1 of Protocol No. 1).

Under the communist regime, the land owned by the predecessors of the members of the applicant association was put at the disposal of an agricultural co-operative, which later rented it to the members of the Union of Gardeners. The owners ’ formal right to the land remained unaffected, but they had no possibility of using it.

In July 1998, the gardeners initiated consolidation of ownership proceedings with the view to having the ownership of the land transferred to them. The proceedings were based on the provisions of Act 64/1997 Coll., according to which such land could be acquired by the tenants using the land without the consent of the land owner, who was entitled to receive either a different plot of land or pecuniary compensation. As a consequence, in October 2002, the applicant association was offered land to compensate for their loss of ownership at a disproportionately low rate (less than 3% of the current market value of the lost land) and, in February 2003, the ownership of the relevant plots passed formally to the tenants. Pending the outcome of the consolidation proceedings, the provisions of Act 64/1997 Coll. was applicable and required the tenants to pay rent to the applicant association until the proceedings were resolved. Under the Act, the rent payable by the tenants to the applicant association was set at ten per cent of its value and was lower than the real property tax payable in respect of the land.

The European Court found that the transfer of ownership of the applicants ’ land to the tenants amounted to a disproportionate deprivation of possessions. In the European Court ’ s opinion, the public interest in pursuing proceedings under Act 64/1997 Coll. was not sufficiently broad and compelling to justify the substantial difference between the real value of the applicant ’ s land and that of the land which it obtained in compensation. Thus the effects produced by application of Act 64/1997 failed to obtain a fair balance between the interests at stake, i.e. those of the individual gardeners using the land in garden allotments and those of the owners. Moreover, concerning the compulsory letting of the land, the European Court noted that the general interest did not justify such a low level of rent which bore no relation to the actual value of land. Thus the compulsory letting of the land on the basis of the rental terms set out in the applicable statutory provisions amounted to a disproportionate control of use of the applicant ’ s property.

The Jenisov á , Salus and Å ef č ikov á cases also concern violations of the right to the peaceful enjoyment of possessions of the applicants due to the compulsory letting of their land and scheduled or envisaged transfer to tenants (violations of Article 1 of Protocol No. 1).

I. Individual measures

Payment of just satisfaction

Urbárska Obec Trenčianske Biskupice

Pecuniary damage

Non-pecuniary damage

Costs and expenses

Total

200 000

12 000

219 000

Paid on 30/06/2009

Jenisov á

Pecuniary damage

Non-pecuniary damage

Costs and expenses

Total

9 000

1 000

300

10 300

Paid on 29/03/2010

Salus

Pecuniary damage

Non-pecuniary damage

Costs and expenses

Total

15 000

2 000

-

17 000

Paid on 29/03/2010

Å ef čí kov á

Pecuniary damage

Non-pecuniary damage

Costs and expenses

Total

8 188

2 000

500

10 688

Paid on 29/03/2010

II. General measures

a. Legislation

In the case of Urbárska Obec Trenčianske Biskupice, the European Court, under Article 46, concluded that the violation arose from the state of the Slovakian legislation, which has affected a number of landowners whose land comes under the regime of Act 64/1997 Coll. Both violations arose from the application of a law to a specific category of citizens. The European Court noted that this case is the first of a number that are pending before the Court and identified a systematic violation. It therefore suggested that Slovakia should take action to address the violation. Therefore two legislative amendments were adopted at national level. On 8 February 2011, the National Council of the Slovak Republic adopted the amendment of the Act 64/1997 Coll. and the Ministry of Justice of the Slovak Republic adopted the amendment of its Regulation No. 492/2004 Coll. on Determining the General Value of Property. As a result of these general measures, the rental terms for the letting of land in garden allotments is able to take into account the actual value of the land and the current market conditions and compensation for the transfer of ownership of land has a reasonable relation to the market value of the property at the time of the transfer (see Annex for more details).

b. Publication

The judgments were translated into the Slovak language and in compliance with the existing practice of publishing of all judgments against the Slovak Republic they were published in the Judicial Revue (Justi č n á Revue) No. 4/2008 and 4/2009 (Urbárska Obec Trenčianske Biskupice, No. 6-7/2008 ( Å ev čí kov á ) and No. 12/2009 (Salus and Jenisov á ).

Ill. Conclusions of the respondent State

The government considers that the measures adopted have fully remedied the consequences for the applicants of the violation of the Convention found by the European Court in these cases, that these measures will prevent similar violations and that the Slovak Republic has thus complied with its obligations under Article 46 § 1 of the Convention.

In Bratislava, 5 March 2012

Marica Piro š ikov á

Agent of the Government

of the Slovak Republic

before the European Court of Human Rights

Information provided by the Government of the Slovak Republic

for the purposes of the examination of the case Urbárska Obec Trenčianske Biskupice

v. Slovak Republic by the Committee of Ministers of the Council of Europe

(General measures)

I. Introduction

On 8 February 2011, the National Council of the Slovak Republic adopted an amendment to the Act No. 64/1997 Coll. on the Use of Land in Garden Allotments and Arrangements of their Ownership as amended (hereafter the “Act”). In addition, the amendment to the Regulation of the Ministry of Justice of the Slovak Republic No. 492/2004 Coll. on Establishing General Value of Property, which is connected with the Act, came into effect on 1 July 2010.

The amendments were submitted to execute the judgment of the European Court of Human Rights in the case of Urbárska Obec Trenčianske Biskupice v. Slovakia of 27 November 2007. They concern mainly (i) the change of the manner of determining the general value of lands and (ii) the change of the manner of establishing the general value of leased land. The amendments change the way of setting the annual rate of the lease for the use of land and also the way of determining financial compensation for plots of land situated in allotments. In addition to the above, the character of land provided in compensation for plots of land situated in allotments is more precisely defined.

The aim of the amendments was to enforce general measures at domestic level, in order (i) to remove any obstacles to the lease of land in garden allotments under conditions at real price of the land and the current market conditions in the location concerned and (ii) to eliminate all obstacles to the transfer of or compensation for ownership rights related to the market price of the property on the day of transfer.

II. Amendments to the Act

II. a measures concerning the letting of land in garden allotments on rental terms which take account of the actual value of the land and current market conditions in the area concerned

According to Article 4 § 1 of the Act, the amount of annual rent for the use of plots of land upon lease pursuant to Article 3, shall be determined by a specific regulation

This specific regulation is the Regulation of the Ministry of Justice of the Slovak Republic No. 492/2004 Coll. on Establishing General Value of Property as amended. This regulation determines the market value of the land. The Slovak law does not use the term “market value” but the term “general value”. According to Section 2 of the regulation, the general value of the property represents a final objectified value of the real property (objectification represents an expert assessment of the general value of the property in the light of the technical state, market influence, economic influences and other specific factors), which is, according to expert assessment, the most likely price of the assessed property on the day of assessment at a given place and time, which the property should reach on the market in the circumstances of free competition, fair sale, when both buyer and seller act as duly informed and vigilant and provided the price is not affected by false motive; the value added tax is generally included.

According to Annex 3 to the regulation, the general value of the real property is an objectified value of real property and buildings, which represents, according to the expert assessment, their most likely price on the day of assessment at a given place and time, which they should reach on the market in circumstances of free competition and fair sale, when both buyer and seller act as duly informed and vigilant and provided the price is not affected by false motive. The general value shall be established by applying the following methods: (i) comparative method; (ii) combined method (to be used in case of buildings from which one can make a profit by renting them); (iii) yield method (to be used in case of lands which are able to obtain the yield); and (iv) method of positional differentiation.

When applying the comparative method, the general value of the real property is determined by being compared to the prices of other, comparable real estates in the given area. It is necessary to use as a basis for the comparison the certificates of transfer or disposal of at least three real estates (contract of purchase, etc) or the offers of estate agencies, and the comparison is made in terms of the economic factors (date of the transfer, method of the transfer, method of the payment, etc), positional factors (place, locality, attractiveness, etc.) and structural and physical factors (infrastructures and a possibility of housing development in case of building sites, land quality and quality of planting in case of other lands, etc.).

The yield method is based on the calculation of capitalisation of the exhaustible resources within a limited period of time. When applying the method of positional differentiation, the general value of the real property is established on the basis of the evaluation of individual factors which can affect the price of real estate. The following factors are usually taken into account: real estate market and purchasing power of the population; location of the real property in the municipality; current state of the real property; type and utilisation of the real property; infrastructures arrangements of the property (adequacy of the underground services in the neighbourhood of the real property and a possibility of directly connecting the property to the underground services in the neighbourhood of the real property through one ’ s own or municipal lands); transport in the neighbourhood of the real property; prevailing housing development in the neighbourhood of the real property; facilities of the real property; working opportunities of the population; composition of the population in the place of the construction; orientation of the real property towards the cardinal points; configuration of the terrain, civil facilities, natural area in the vicinity of the construction; quality of the environment in the vicinity of the real property; possibility of introducing changes in the built-up area (urban development); possibilities of further expansion, making profit from the real estate; opinion of the expert; and other factors such as prospective plans of the use, natural reservations, building barriers, easements, etc.

It is clear from the above that the methods for determining “the general value” of the real property take into account all factors which are relevant for “the market value” of the property.

As to the rent for land in garden allotments before 1 April 2011 (i.e before the Act became effective) and considering the obligation of domestic authorities under Article 154c of the Constitution to preferentially apply the Convention for the Protection of Human Rights and Fundamental Freedoms as interpreted by the judgment Urbárska Obec Trenčianske Biskupice v. Slovakia, individuals may claim before the domestic courts the determination of the amount of rent taking in account the real price of the land and the current market conditions in the given location. Reference should be made to the decision of the Supreme Court of the Slovak Republic, File No. 6S ž o/400/2009 of 26 October 2010, quashing the relevant judgment of the Prešov Regional Court on a matter concerning the approval of a project of land arrangements for the settlement of ownership of land in garden allotments. In its decision, the Supreme Court pointed to the judgment of the European Court of Human Rights in the case of Urbárska Obec Trenčianske Biskupice v. Slovakia and the direct effect of the Convention in the Slovak legislation. The Supreme Court indicated to the Regional Court that when examining the matter it failed to take into account the relevant case law of European Court of Human Rights, pointing out that no requirements of general interests were strong enough to excuse the low amount of compensation for land; including the low rate of rent.

II.b measures concerning the award of compensation for the transfer of ownership of such land in an amount which bears a reasonable relation to the market value of the property at the date of transfer

According to Article 7 § 5 of the Act, after the commencement of the proceedings the Circuit Land Office invites The Slovak Land Fund to propose, within reasonable time, substitute plots of land in the same district, where the majority of the original land is to be found, along with an expert opinion determining the value thereof. This amendment reflects the judgment of the European Court of Human Rights as the substitute land shall be of adequately comparable value to the plot of land transferred.

According to Article 8 § 2, the Circuit Land Office determines the amount of financial compensation for plots of land situated in garden allotments on the basis of an expert opinion in accordance with the specific regulations (Regulation of the Ministry of Justice of the Slovak Republic No. 492/2004 Coll. on Establishing General Value of Property as amended). This amendment reflects the judgment of the European Court of Human Rights as the financial compensation shall respond to the market value of the land.

According to Article 10 § 1, the Circuit Land Office calls the owners to announce within 60 days whether they request substitute lands in the value determined by the expert opinion or financial compensation.

II.c Measures to compensate land owners who had land transferred or compensated for at low levels that did not relate to the market value of the property at the time of transfer, under the scheme in place prior to the European Court ’ s judgment

Article 18a of the Act is followed by Article 18b and 18c providing that the party to the proceedings the rights of which have been finally decided upon by approval of the project on land consolidation until 31 March 2011 shall be entitled to financial compensation for plots of land, namely in the amount corresponding to the difference between the financial compensation pursuant to this Act and financial compensation already provided to the party if the provision thereof was requested by 31 December 2011 at the Circuit Land Office; otherwise such right shall be extinguished. Financial compensation shall be paid by the Slovak Land Fund upon the decision of the Circuit Land Office.

Moreover, if the project was not finally approved by 31 March 2011 or the decision on approval of the project was quashed by a court, the Circuit Land Office shall provide an expert opinion to determine the amount of compensation for plots of land pursuant to the Act. The Circuit Land Office shall replace decisions issued in proceedings before 31 March 2011 by fresh decisions delivered according to this Act.

The Act became effective as of 1 April 2011.