Information Note on the Court’s case-law 122

August-September 2009

Perdigão v. Portugal - 24768/06

Judgment 4.8.2009 [Section II]

Article 1 of Protocol No. 1

Article 1 para. 1 of Protocol No. 1

Deprivation of property

Compensation for expropriation wholly absorbed by legal costs: violation

[This case was referred to the Grand Chamber on 10 December 2009]

Facts – The applicants requested over twenty million euro s in compensation to cover the profit they claimed they could have made by exploiting a quarry on land that had previously been theirs but had been expropriated. The court of appeal rejected their claim, taking the view that the potential profits from the quarry should not be taken into account, and set the compensation at around EUR 197,000. However, the legal costs the applicants were required to pay as the losing party in those proceedings exceeded the amount of the award. As a result, not only did the a mount awarded in compensation eventually revert to the State, but the applicants had to pay another EUR 15,000.

Law – Article 1 of Protocol No. 1: The lack of compensation complained of by the applicants had resulted. from the application of the rules conc erning legal costs, which were contributions within the meaning of the second paragraph of Article 1 of Protocol No. 1 and constituted a particular instance of interference with the right to peaceful enjoyment of property. The Court decided to examine the situation complained of in the light of the general rule. The applicants had not contested the lawfulness of the expropriation as such or that of the rules on legal costs which had been applied to them. There was nothing to suggest, either, that the interf erence complained of had been arbitrary, as the applicants had been able, for instance, to submit their arguments to the domestic courts. However, unlike the Government, the Court took the view that the applicants could not be criticised for having endeavo ured to persuade the district court, using the procedural means available to them, to include in the award elements which they deemed to be essential. It was not the Court’s task to conduct an overall examination of the Portuguese system for determining an d fixing legal costs. However, its practical application in the instant case had meant that the applicants received no compensation whatsoever for the deprivation of their property. In the circumstances, the conditions of compensation – or, more precisely, the lack of compensation – had imposed an excessive burden on the applicants, upsetting the fair balance that had to be struck between the general interest of the community and the individual’s fundamental rights.

Conclusion : violation (five votes to two) .

Article 41: EUR 190,000 in respect of pecuniary damage. Finding of a violation constituted sufficient just satisfaction in respect of any non-pecuniary damage.

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

Click here for the Case-Law Information Notes