Communicated on 18 October 2017

FOURTH SECTION

Application no. 18054/12 Lilija VASILEVSKA and Tadeu Å¡ BARTOSEVIC against Lithuania lodged on 25 January 2012

STATEMENT OF FACTS

The applicants, Ms Lilija Vasilevska and Mr Tadeuš Bartoševič , are Lithuanian nationals who were born in 1960 and 1959 respectively and live in Vilnius. They are represented before the Court by Ms Eva Jankovska , a lawyer practising in Vilnius.

A. The circumstances of the case

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

In 1991 P.S. asked the Lithuanian authorities to restore to him his ancestors ’ land, which had been nationalised in the 1940s.

By a decision of 28 September 2004, the Vilnius County Administration restored the property rights of P.S. to 1.27 hectares of land in Vilnius County. P.S. registered his title to that plot of land in the real estate register and thus, under Lithuanian law, became its owner.

On 30 June 2005 P.S. sold the entire plot of land for 275,000 Lithuanian litas (LTL – approximately 79,645 euros (EUR)) to a private person, Ž.J ., who took out a mortgage from a bank to buy the plot. Later that year P.S. died. The applicants are the heirs of P.S.

In 2008 the forestry service of the Ministry of the Environment established that 0.87 hectares of Ž.J . ’ s plot of land was covered by forests which fell within the territory of the city of Vilnius. This meant that the forests were of State importance, and therefore could be owned only by the State. By a letter of 17 June 2008 the Ministry of the Environment informed the public prosecutor ’ s office (“the prosecutor”) of its findings. The prosecutor received that letter the following day.

On 14 November 2008 the public prosecutor lodged a civil claim with the Vilnius Regional Court, asking it to quash the property-restoration decision of 28 September 2004 and the property sale agreement of 30 June 2005 on the grounds that part of the plot in question (measuring 0.87 hectares) constituted a forest of State importance, which meant that it could only belong to the State.

Ž .J., who was a defendant in those civil proceedings, contested the prosecutor ’ s arguments and submitted that she had obtained the plot in good faith, because when acquiring the plot of land she had had no reason to believe that the land could not be held as private property. The applicants, who were also defendants in those civil proceedings – as well as the notary who had certified the sale transaction – concurred with Ž .J. ’ s arguments. The Vilnius County Administration, which was also a defendant in the proceedings, also contested the prosecutor ’ s civil claim. According to the Vilnius County Administration, in 2004 P.S. had become the owner of the plot of land in question lawfully, because at that time the plot in question had not fallen within the territory of the city of Vilnius. The bank that had granted a mortgage in respect of the disputed plot also asked the court to dismiss the prosecutor ’ s claim.

The applicants, as well as the other defendants in the case, also argued that the prosecutor had lodged the civil claim only after the statutory time ‑ limit for lodging such a claim, thirty days, had expired.

On 8 March 2010 the Vilnius Regional Court acknowledged that the prosecutor ’ s civil claim had been lodged outside the statutory time-limit, but nevertheless decided to restore that time-limit. The court ruled that if the statutory time-limit could not be restored, this would mean that the administrative act in question – that is to say the Vilnius County Administration ’ s 28 September 2004 decision on the restoration of property to P.S. – would remain valid, and that act had been against the law.

The court then quashed the property restoration decision in so far as it concerned the 0.87-hectare section of the applicants ’ land that was covered by forest. The court noted that, pursuant to the domestic law, forests situated in cities belonged exclusively to the State (see the “Relevant domestic law” part below). Notwithstanding the assertion made by the Vilnius County Administration that in 2004 it had acted in accordance with the law, the court noted the argument advanced by the Ministry of the Environment that as early as on 18 February 2003 it had notified the Vilnius County Administration of a Government resolution of 20 December 2002 whereby the city limits of Vilnius had been expanded. Accordingly, the 0.87-hectare plot in question had already been designated as forests lying within the boundary of the city of Vilnius before the 28 September 2004 decision on the restoration of property rights to P.S. had been issued. It followed that the latter decision had to be quashed. The first-instance court also considered that Ž .J. had not acquired the plot of land honestly, because, according to her testimony, she had known that the plot of land she intended to buy had contained forests, which in the court ’ s view meant that she should have made enquiries at the State institutions regarding the legal status of that forest. As a consequence, the sale agreement of 30 June 2005 was also annulled. The applicants, as the heirs of P.S., were ordered to pay Ž .J. the sum of LTL 188,728 (EUR 54,660) in total, or EUR 27,330 each, which was an amount proportionate to that which in 2005 Ž .J. had paid to P.S. for the part of the plot that was covered by the forest. For her part, Ž .J. was to return that plot to the State ’ s ownership.

The applicants appealed. They argued, inter alia , that there had been a breach of the right to inviolability of property under Article 23 of the Constitution. They asseverated that they had accepted their inheritance from P.S. lawfully.

The above-mentioned court decision was upheld by the Court of Appeal on 12 July 2011. The appellate court firstly held that the statutory time-limit had been missed by the prosecutor for important reasons, since it had been necessary to collect supplementary information after receiving the Ministry of the Environment ’ s letter of 17 June 2008. Therefore, the time-limit had to be restored.

The appellate court also upheld the first-instance court ’ s conclusion that P.S., and in turn Ž .J., had had no right to obtain a plot of land which was within the territory of Vilnius city and thus constituted a forest of State importance. Pursuant to Article 47 of the Lithuanian Constitution, such forests could belong only to the State, and this had been more than once emphasised by the Constitutional Court. Given that the decision by the Vilnius County Administration had been in breach of those principles, it had to be annulled. It was also irrelevant whether the applicants had become the owners of the plot of land in question in good faith. The appellate court also considered that even though Ž .J. had later bought that plot of land, such a transaction had been against imperative legal norm – Article 47 of the Constitution. Therefore, the civil law norms protecting an honest acquirer ( sąžiningas įgijėjas ) were not applicable in the instant case. As to the bank, the appellate court considered that, as a credit institution and business entity, it should have verified whether Ž .J. ’ s “business plan” had been viable, but instead had failed to have a look at ( ap žiūrėti ) the plot of land in order to verify its designation.

Neither the first-instance, nor the appellate decisions stipulated what particular form of compensation – such as another plot of land or a sum of money – the applicants, as heirs of P.S., would receive from the State, or when they would receive it.

On 19 September 2011 the Supreme Court refused to accept the applicants ’ appeal on points of law for examination.

B. Relevant domestic law and practice

The Constitution reads that property shall be inviolable, and that rights of ownership shall be protected by law. Property may be taken only for the needs of society, only in accordance with the procedure established by law, and only in return for just compensation (Article 23). The Constitution also stipulates that forests of State importance shall fall under the exclusive ownership of the Republic of Lithuania (Article 47).

The Law on the Restoration of Citizens ’ Ownership Rights to Existing Real Property ( Piliečių nuosavybės teisių į išlikusį nekilnojamąjį turtą atkūrimo įstatymas ), enacted on 1 July 1997 and amended on numerous occasions, provided for two forms of restitution: 1) the return of the property in natura , or 2) compensation for it (by allocating another plot of land or paying pecuniary compensation) if the physical return of the property in question was not possible.

Under Article 6 §§ 2 and 4 and Article 13 §§ 1 (3) of that law, forest that was designated by the Government as falling within the territory of a city was to be bought out by the State and compensated for in accordance with the guidelines set out by the Government.

The Law on Forests reads that forests which were within city boundaries fell into the category of forests of State importance and thus could only be owned exclusively by the State (Article 4 § 4 (2)).

In a ruling of 6 September 2007 the Constitutional Court held that all forests that were located in the cities were of State importance, irrespective of whether they had been designated as such by the Government. Therefore only the State could own them.

The Civil Code reads that any transaction that fails to meet mandatory statutory provisions is null and void. When a transaction is null and void, each party is bound to restore to the other party everything that he or she has received under that transaction. Where it is impossible to restore in kind that which was received, the parties are bound to agree on monetary compensation for what they received from each other, unless the laws provide for other consequences of nullity of the transaction (Article 1.80).

The Civil Code also provides that the State may take away ( išreikalauti ) immovable property from a person who acquired such property in good faith only if the rightful owner lost that property as a result of a crime (Article 4.96 § 2).

COMPLAINTS

The applicants complain under Article 1 of Protocol No. 1 to the Convention that the State deprived them of property without affording them any compensation. The applicants submit that the courts had no legal grounds to annul P.S. ’ s and subsequently Ž .J. ’ s title to the plot of land in question, because that plot of land had not been obtained either by mistake or unlawfully. The applicants also submit that the court decisions to annul the titles to that plot, and to order the applicants to pay compensation to Ž .J., had placed the applicants, who had acted honestly, in a significantly disadvantageous position. They emphasise that they were not parties to the restitution proceedings in which the authority implementing the State ’ s powers – the Vilnius County Administration – restored P.S. ’ s property rights in respect of the plot of land. They only accepted the inheritance, without expecting that later they would have to pay the sum of LTL 188,728 (EUR 54,660) to Ž .J. Even so, it was they and not the institution that restored property rights and which, in the courts ’ view, took the unlawful decision in question, which had to bear the consequences. The applicants also underline that in 2012, when they lodged their application with the Court, the restitution process in Lithuania was coming to an end, and there were no other free plots of land to choose from. They also state that they did not receive a plot of land of equal value to that which was taken away by the court decisions, even though this would have been one of fair solutions in their case.

QUESTIONS TO THE PARTIES

1. Has there been a violation of Article 1 of Protocol No. 1 to the Convention in view of the quashing of the Vilnius County Administ ration decision of 28 September 2004 to restore P.S. ’ s property rights to the plot of land, as well as the subsequent sale of that plot to Ž .J. (see Turgut and Others v. Turkey , no. 1411/03, § 90, 8 July 2008), in particular bearing in mind that the applicants were ordered to compensate Ž .J. for that property (see Lithgow and Others v. the United Kingdom , 8 July 1986, § 120, Series A no. 102; Jahn and Others v. Germany [GC], nos. 46720/99, 72203/01 and 72552/01, § § 93 and 94, ECHR 2005 ‑ VI; Albergas and Arlauskas v. Lithuania, no. 17978/05, §§ 58-61, 68, 69, 73-75, 27 May 2014, and Misiukonis and Others v. Lithuania , no. 49426/09, § 60, 15 November 2016 )?

2. The parties are requested to inform the Court about any further developments in the applicants ’ case regarding payment of compensation to Ž .J. and restitution of land to the applicants ’ , as to the heirs of P.S.