FOURTH SECTION

Application no . 26860/11 Maria KRA SNODĘBSKA - KAZIKOWSKA and Hanna Ł UNIEWSKA against Poland lodged on 21 April 2011

STATEMENT OF FACTS

THE FACTS

The applicants, Ms Maria Krasnodębska - Kazikowska and Ms Hanna Łuniewska , are Polish nationals, who were born in 1942 and 1943 respectively and live in Warszawa. They are represented before the Court by Ms E. Słotwińska , a lawyer practising in Warszawa.

A. The circumstances of the case

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

1. The applicants ’ efforts to obtain compensation for damage caused by the expropriation decision

The applicants are legal successors of former owners of land in the vicinity of Warsaw , called Willa Janówka , composed of a number of plots owned by several persons.

In 1971 the then owners of the property, E.P. and other persons, were obliged by an administrative decision to transfer their land to the State Treasury without compensation within the framework of a larger expropriation scheme.

On 30 December 2005 the Local Self-Government Board of Appeal ( Samorządowe Kolegium Odwoławcze w Warszawie ) gave a decision concerning the applicant and three other persons, legal successors of the other former owners expropriated by the 1971 decision. It declared that the 1971 decision had been issued in flagrant breach of law in force at the material time. The parties were further informed that the corrective decision gave rise to a compensation claim on their part for damage caused by the original unlawful decision.

On 28 August 2006 the applicants sought compensation for damage caused by the unlawful decision given in 1971.

On 15 May 2009 the Warsaw Regional Court allowed the applicants ’ claim and awarded PLN 64,487 to each of them. It held that the conditions determining liability in tort, namely an event amounting to a tort which caused damage and the establishment of a causal link between the event and the damage, were met in the case. In respect of a tort caused by unlawful administrative decisions compensation could be sought only after a subsequent decision declared that the original administrative decision was unlawful. Such a corrective decision ( decyzja nadzorcza ) had been given in the applicants ’ case in 2005.

It was necessary to determine which provisions of substantive law were applicable in the circumstances of the case and how they determined the beginning and length of the prescription period. The court noted that the original administrative decision was given before 1 September 2004. On that date the Law of 17 June 2004 amending the Civil Code had entered into force. This law had fundamentally changed the legal framework concerning civil liability of the State Treasury. It abrogated, inter alia , Article 160 of the Code of Administrative Procedure and enacted Article 417 1 of the Civil Code (see Relevant domestic law). The court was of the view that it was the latter provision which should be applied to the circumstances of the case. Under this provision, read together with the provisions of the Civil Code on liability in tort, the prescription period had started to r un only when the decision of 30 December 2005, confirming the unlawfulness of the original expropriation decision, became final. The prescription period of three years had not therefore expired.

The defendant State Treasury, represented by the Warsaw Mayor, appealed.

On 26 November 2009 the Warsaw Court of Appeal examined the appeal and dismissed the applicants ’ claim. It shared the findings of fact made by the lower court as to the existence of damage and the causal link between the 1971 decision and that damage. However, it was of the view that the provisions concerning the State ’ s civil liability in tort should have been interpreted differently by the first-instance court, in particular as to the determination of the prescription period. It observed that under the communist regime it was practically impossible for political reasons to vindicate claims originating in unlawful administrative decisions or to seek compensation from the State Treasury for damage in tort caused by such decisions. The earliest possibility fo r doing so had arisen as from 4 June 1989 when the first partially free parliamentary elections were held. It was from that date that the prescription period of ten years provided for by Article 442 of the Civil Code had started to run. The applicants should have availed themselves of the available remedy, i .e. they should have obtained a decision declaring the original expropriation decision unlawful and had instituted compensation proceedings prior to 4 June 1999 when the ten ‑ year prescription period had come to an end.

The applicant appealed. She argued, in particular, that the contested judgment was in breach of Article 77 of the 1997 Constitution in so far as it guaranteed the right to compensation for damage caused by the State. She further submitted that the case raised a significant legal issue in so far as there were divergent strands of case-law regarding the interpretation of legal provisions governing the State ’ s civil liability for administrative decisions given prior to 1 September 2004 which were declared unlawful after that date.

On 21 October 2010 the Supreme Court refused to entertain the applicants ’ cassation appeal, holding that it did not raise any significant legal issue.

2. The efforts of other persons affected by the original expropriation decision to obtain compensation

Parallel to the applicants ’ case, A.C., a successor of another owner expropriated by the same administrative decision given in 1971 and covered by the same corrective decision of 30 December 2005, sought compensation in civil proceedings. She lodged her claim with the Warsaw Regional Court on 30 August 2006.

By a judgment of 30 September 2010 the Warsaw Regional Court allowed her claim and awarded her compensation in the amount of PLN 110,187. It recounted briefly the different views expressed by different courts, including the Supreme Court , as to the manner in which the provisions concerning the State ’ s liability in tort for unlawful administrative decisions given in the past were interpreted. It disagreed with the view expressed by the Supreme Court in one of these decisions where the Supreme Court had held that the ten-year prescription period had started to run on the date when the unlawful decision become lawful, but its running was subsequently stayed until 5 June 1989. The Regional Court was of the view that in the case under examination, the three ‑ year prescription period had started to run when the decision of 30 December 2005 declaring the 1971 decision unlawful had become final.

3. Further case-law developments

On 8 January 2010 the President of the Supreme Court requested the Civil Chamber of that court to adopt a resolution by a bench composed of seven judges to answer a legal question as to the substantive law governing compensation claims in respect of damage caused by administrative decisions issued before 1 September 200 4 where the unlawfulness of the decisions was declared by way of an administrative decision given after that date. He noted that two strands had developed in the case ‑ law of the Supreme Court and also other courts as to the applicable substantive law against a background of serious difficulties concerning the temporal scope and consequences of the Law of 17 June 2004 which had entered into force on 1 September 2004. These divergences decisively affected the compensation rights arising on the part of persons who had in the past received unlawful administrative decisions. One strand of the case ‑ law supported the view that the prescription period of three years determined by the former Article 160 of the Code of Administrative Procedure started to run when the unlawfulness of the origina l decision was declared after 1 September 2004. The other strand of the case- law stipulated that Article 417 1 of the Civil Code taken together with the provisions of that Code governing the law of tort should be applied, with the ten ‑ year prescription time-limit for the compensation cl aim starting to run either on 4 June 1989 or when the unlawful decision had been given. In addition, there were also judicial decisions which interpreted the applicable provisions differently, in particular as to the date marking the beginning of the prescription period.

On 24 August 2010 the Civil Chamber of the Supreme Court, sitting as a bench of seven judges, requested the full composition of that Chamber to adopt a resolution clarifying the issues raised by the President ’ s request ( III CZP 4/10 ). It noted that the issue had given rise to serious discrepancies in the case-law, including that of the Supreme Court itself. Considering the importance of the issues involved and the fact that previous decisions and resolutions of the Supreme Court had failed to bring uniformity into judicial practice, a resolution by the Civil Chamber of the Court sitting as a full bench was called for.

On 31 March 2011 the Civil Chamber of the Supreme Court, sitting as a full bench, adopted a resolution (III CZP 112/10). It acknowledged that the applicable provisions had given rise to serious difficulties and to divergent interpretations in judicial practice. It held that in situations similar to that of the appellants, former Article 160 of the Code of Administrative Procedure was applicable. The three-year time-limit within which to claim compensation for damage caused by an unlawful administrative decision given prior to 1 September 2004 started to run from the date of the correcting decision.

This decision has no bearing on the applicants ’ case as it is res iudicata .

B. Relevant domestic law and practice

Compensation for damage caused by unlawful administrative decisions

Article 155 of the Code of Administrative Procedure permits the amendment or annulment of any final administrative decision at any time where necessary in the general or individual interest, if this is not prohibited by specific legal provisions. In particular, pursuant to Article 156, a final administrative decision is subject to annulment if it has been issued by an authority which had no jurisdiction, or if it is without a legal basis or contrary to the applicable laws.

Article 160 of the Code of Administrative Proc edure, as applicable prior to 1 September 2004, read in its relevant part:

“A person who has suffered loss on account of the issuing of a decision in a manner contrary to Article 156 § 1 or on account of the annulment of such a decision shall have a claim for compensation for actual damage, unless he has been responsible for the circumstances mentioned in this provision.”

An administrative decision in respect of the compensation claim could be appealed to a civil court.

Article 417 § 1 of the Civil Code provides:

“The State Treasury, or [as the case may be] a self-government entity or other legal person responsible for exercising public authority, shall be liable for any damage ( szkoda ) caused by an unlawful act or omission [committed] in connection with the exercise of public authority.”

Article 417 1 § 2 of the Code, which entered into force on 1 September 2004, provides that when damage had been caused by way of an unlawful and final decision, a compensation claim in respect of damage caused by such a decision can be made after the unlawfulness of such decision has been declared in separate proceedings.

COMPLAINTS

The applicants complain, invoking Article 6 § 1 of the Convention, that the proceedings before the domestic courts had been unfair. The fact that the same set of facts could give rise to differing legal assessments from one court to another was in breach of the principle of legal consistency.

The applicants further ref er to Article 1 of Protocol No. 1 to the Convention and complain that the domestic law created on their part an entitlement to obtain compensation for damage caused by an unlawful administrative decision, arising when the unlawfulness was confirmed by way of a subsequent corrective decision. However, they did not receive anything because the courts interpreted the conflicting and confusing provisions of domestic law in a way which declared their claim prescribed. The applicants were thus deprived of their right to compensation as a result of the bad quality of the law. They emphasise that the bad quality of the law has been highlighted in their case by the fact that a successor of a former owner of land covered by the same administrative decisions received compensation, despite the fact that the circumstances of the case were identical. Even assuming that the interference was lawful, the refusal to award them compensation for damage caused by the manifestly unlawful administrative decision imposed an excessive burden on the applicants.

QUESTIONS TO THE PARTIES

1. Have the applicants had a fair hearing in the determination of their civil rights and obligations, in accordance with Article 6 § 1 of the Convention in so far as similar actions before the courts of appeal, concerning the award of compensation in respect of damage caused by unlawful administ rative decisions given before 1 September 2004, had different outcome s (see, among other authorities, Beian v. Romania (no. 1) , no. 30658/05, ECHR 2007 ‑ XIII (extracts) ; and Iordan Iordanov and Others v. Bulgaria , no. 23530/02 , 2 July 2009 ; Perez Arias v . Spain , no. 32978/03, § 25, 28 June 2007; Beian (no. 1) , cited above , §§ 34 ‑ 40; Åžtefan and Åžtef v. Romania , nos. 24428/03 and 26977/03, §§ 33 ‑ 36, 27 January 2009) ?

Was the principle of legal certainty, as developed in the Court ’ s case ‑ law in the interpretation of Article 6 of the Convention, complied with by the domestic courts?

2. Has there been an interference with the applicants ’ peaceful enjoyment of possessions, within the meani ng of Article 1 of Protocol No. 1? Has that interference complied with the requirements of this provision (see Plechanow v. Poland , no. 22279/04 , 7 July 2009; Norbert Sikorski v. Poland , no. 7599/05 2 2 October 2009)?