Information Note on the Court’s case-law 208

June 2017

Stefanetti and Others v. Italy (just satisfaction) - 21838/10, 21849/10, 21852/10 et al.

Judgment 1.6.2017 [Section I]

Article 41

Just satisfaction

Loss of two-thirds of old-age pension as a result of introduction of legislation effectively deciding outcome of pending litigation against the State: assessment of pecuniary damage

Facts – The app licants brought court proceedings contesting the method of calculation used by the National Social Security Agency (INPS) to determine their old-age pension entitlement. However, the courts dismissed their claims following the introduction during the proce edings of interpretative legislation – a provision of the Finance Act 2007 (Law no. 296/2006) – endorsing the position of the INPS. As a result, the applicants lost approximately two-thirds of the pension which they could have expected to receive on the ba sis of the domestic courts’ case-law.

In a judgment of 15 April 2014 (“the principal judgment”, Information Note 173 ), the Court found a violation of Article 6 § 1 of the Convention and Article 1 of Protocol No. 1 on account of the lack of any compelling reasons of public interest and the disproportionate consequences of the legislative intervention in question. It awarded the applicants EUR 12,000 each in respect of non-pecuniary damage and reserved the question of pecuniary damage.

Law – Article 41 ( pecuniary damage ): The Court determined the damage in two stages.

(a) Calculation of the difference between the sums actually received and those which the applicants would have obtained in the absence o f the impugned legislation

(i) Reference period – The period to be taken into account started on the date of the applicants’ retirement. As to the finishing point, the Court did not accept:

– either that the period should end with the entry into force of the legislation in question (the Government’s argument), as the violation of Article 6 of the Convention and of Article 1 of Protocol No. 1 was not linked exclusively to the retrospective nature of the legislation;

– or that it should run to the end of t he applicants’ remaining life expectancy (the applicants’ argument), as just satisfaction had to relate to the violations found. With regard to the period subsequent to the principal judgment (delivered in 2014), the damage sustained was to be determined a nd dealt with by the national authorities in the context of the procedure for execution of the principal judgment. That damage resulted solely from the fact that the impugned legislation was still in force; under Article 46 §§ 1 and 2 of the Convention, in the context of the execution of judgments, States were under an obligation to put an end to the violation found and erase its consequences. The Court referred in this regard to Resolution CM/ResDH (2013)91 of the Committee of Ministers of 29 May 2013 on the execution of the judgment in Lakićević and Others v. Montenegro and Serbia (27458/06 et al., 13 December 2011, Information Note 14 7 ).

In sum, the Court decided to base its calculations on the pension arrears as established in 2014.

(ii) Figures submitted by the parties – As the sums claimed by the applicants incorrectly took into account various contributions that were not relevant, the Court decided to base its calculation on the amounts indicated by the Government, established on the basis of the INPS tables. As to the period after the date at which the Government figures stopped (2012), the Court based its assessment on the applicants’ figures.

(b) Determination of the damage on this basis, in view of the nature of the violation found – The damage sustained in the pre sent case went beyond mere “loss of opportunity”, as there had been a violation not just of Article 6 § 1 of the Convention but also of Article 1 of Protocol No. 1.

Nevertheless, the Court would not have made the same finding of a violation had the reducti on in the applicants’ pension entitlement remained reasonable and proportionate. The Court had previously found that a reduction of less than half was not unreasonable (see Maggio and Others v. Italy , 46286/09 et al., 31 May 2011, Information Note 141 ).

Hence, the damage for which compensation was due did not amount to the full difference between the sums received by the applicants and the sums they would have obtained had the legislation not been pass ed. In view of the nature of the dispute in question, the Court found it reasonable to set the amount of pecuniary damage at the difference between the sums received and 55% of the sums the applicants would have obtained in the absence of the legislation.

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Following these calculations, the Court awarded each of the applicants an amount of between EUR 14,786 and EUR 167,601, depending on the case. The Court specified that the amounts in question did not give rise to any special exemption from income tax o n the pension arrears.

© Council of Europe/European Court of Human Rights This summary by the Registry does not bind the Court.

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