EUROPEAN COMMISSION OF HUMAN RIGHTS
Application No. 14807/89
Agrotexim Hellas S.A. and Others
against
Greece
REPORT OF THE COMMISSION
(adopted on 10 March 1994)
TABLE OF CONTENTS
Page
I. INTRODUCTION
(paras. 1 - 16). . . . . . . . . . . . . . . . . . . . .1
A. The application
(paras. 2 - 4). . . . . . . . . . . . . . . . . . .1
B. The proceedings
(paras. 5 - 11) . . . . . . . . . . . . . . . . . .1
C. The present Report
(paras. 12 - 16). . . . . . . . . . . . . . . . . .2
II. ESTABLISHMENT OF THE FACTS
(paras. 17 - 46) . . . . . . . . . . . . . . . . . . . .4
A. The particular circumstances of the case
(paras. 17 - 41). . . . . . . . . . . . . . . . . .4
B. Relevant domestic law
(paras. 42 - 46). . . . . . . . . . . . . . . . . .7
III. OPINION OF THE COMMISSION
(paras. 47 - 93) . . . . . . . . . . . . . . . . . . . 10
A. Complaints declared admissible
(para. 47). . . . . . . . . . . . . . . . . . . . 10
B. Points at issue
(para. 48). . . . . . . . . . . . . . . . . . . . 10
C. As regards Article 1 of Protocol No 1
to the Convention
(paras. 49 - 80). . . . . . . . . . . . . . . . . 10
D. As regards Article 6 para. 1 of
the Convention
(paras. 81 - 89). . . . . . . . . . . . . . . . . 16
E. As regards Article 13 of the Convention
(paras. 90 - 92). . . . . . . . . . . . . . . . . 17
F. Recapitulation
(para. 93). . . . . . . . . . . . . . . . . . . . 18
SEPARATE OPINION OF MR. H. DANELIUS
JOINED BY MR. M. PELLONPÄÄ. . . . . . . . . . . . . . . . . 19
PARTIALLY CONCURRING AND PARTIALLY DISSENTING OPINION
OF MRS. G.H. THUNE (AND MR. J.A. FROWEIN) . . . . . . . . . 20
DISSENTING OPINION OF SIR BASIL HALL. . . . . . . . . . . . 21
PARTIALLY DISSENTING OPINION OF MR. L. LOUCAIDES
JOINED BY MM. F. ERMACORA, J.-C. SOYER,
AND C.L. ROZAKIS. . . . . . . . . . . . . . . . . . . . . . 24
APPENDIX I : HISTORY OF THE PROCEEDINGS . . . . . . . 25
APPENDIX II : DECISION ON THE ADMISSIBILITY
OF THE APPLICATION . . . . . . . . . . . 27
I. INTRODUCTION
1. The following is an outline of the case as submitted to the
European Commission of Human Rights, and of the procedure before the
Commission.
A. The application
2. The application was introduced by Agrotexim S.A., Biotex S.A.,
Hymofix S.A., Kykladiki S.A. Mepex S.A. and Texema S.A., companies
registered under Greek law. The applicant companies are shareholders
of the "Karolos Fix Brewery S.A.", a company registered in Athens,
currently under liquidation. In the proceedings before the Commission
the applicants were represented initially by Mr. Prodromos Dagtoglou,
Attorney at Law, and later by Mr. Panayiotis Bernitsas, Attorney at
Law.
3. The application is directed against Greece. The respondent
Government were initially represented by Mr. Constantinos Economides,
Head of the Special Legal Department of the Ministry of Foreign
Affairs. They are now represented by Mr. Georgios Sgouritsas, President
of the Legal Council of State, Agent of the Government.
4. The case concerns various measures taken by the Municipality of
Athens since 1979 with a view to expropriate two plots of land owned
by the Karolos Fix Brewery S.A, while no formal expropriation procedure
was initiated. The applicants invoke Articles 6 and 13 of the
Convention and Article 1 of Protocol No 1.
B. The proceedings
5. The application was introduced on 29 November 1988 and registered
on 21 March 1989.
6. On 13 February 1990, the Commission decided, pursuant to
Rule 48 para. 2 (b) of its Rules of Procedure, to give notice of the
application to the respondent Government and to invite the parties to
submit written observations on its admissibility and merits.
7. The Government's observations were submitted on 16 May 1990. The
applicants replied on 4 July 1990.
8. On 8 July 1991, the Commission decided to hold a hearing of the
parties. The hearing was held on 12 February 1992. The applicants
were represented by Mr. Panayiotis Bernitsas, their representative,
Mrs. Domna Mirasyesi, Attorney at Law, and Mr. Georgios Tsironis,
former Director General of the Karolos Fix Brewery S.A., Counsel. The
Government were represented by Mr. Fokion Georgakopoulos, Assistant
Legal Adviser of the Legal Council of State, acting Agent of the
Government, and by Mr. Vassilios Kontolaimos, Assistant Legal Adviser
of the Legal Council of State, Counsel.
9. On 12 February 1992, the Commission declared the application
admissible.
10. The text of the Commission's decision on admissibility was sent
to the parties on 22 April 1992 and they were invited to submit such
further information or observations on the merits as they wished. The
Government submitted observations on 25 June 1992, to which the
applicants replied on 28 September 1992. On 19 February 1993, the
Government submitted written comments on the applicants' reply.
11. After declaring the case admissible, the Commission, acting in
accordance with Article 28 para. 1 (b) of the Convention, also placed
itself at the disposal of the parties with a view to securing a
friendly settlement. Consultations with the parties took place between
22 April 1992 and 5 April 1993. In the light of the parties' reaction,
the Commission now finds that there is no basis on which such a
settlement can be effected.
C. The present Report
12. The present Report has been drawn up by the Commission in
pursuance of Article 31 of the Convention and after deliberations and
votes, the following members being present:
MM. C.A. NØRGAARD, President
J.A. FROWEIN
F. ERMACORA
G. JÖRUNDSSON
A.S. GÖZÜBÜYÜK
J.-C. SOYER
H.G. SCHERMERS
H. DANELIUS
Mrs. G. H. THUNE
Sir Basil HALL
MM. F. MARTINEZ RUIZ
C.L. ROZAKIS
Mrs. J. LIDDY
MM. L. LOUCAIDES
M.P. PELLONPÄÄ
13. The text of this Report was adopted on 10 March 1994 and is now
transmitted to the Committee of Ministers of the Council of Europe, in
accordance with Article 31 para. 2 of the Convention.
14. The purpose of the Report, pursuant to Article 31 of the
Convention, is:
i) to establish the facts, and
ii) to state an opinion as to whether the facts found disclose
a breach by the State concerned of its obligations under the
Convention.
15. A schedule setting out the history of the proceedings before the
Commission is attached hereto as Appendix I and the Commission's
decision on the admissibility of the application as Appendix II.
16. The full text of the parties' submissions, together with the
documents lodged as exhibits, are held in the archives of the
Commission.
II. ESTABLISHMENT OF THE FACTS
A. The particular circumstances of the case
17. The applicant companies are shareholders of the company "Karolos
Fix Brewery S.A." registered in Athens. They own 295,783 of the total
576,000 shares of the said company, i.e. 51.35 %.
18. It appears from a report issued in October 1983 by the
"Organisation for the Redressment of Undertakings" ("Organismos
Anasyngrotissis Epicheirisseon" - O.A.E.) that since 1975 the Karolos
Fix Brewery S.A. has presented a decreasing course which created
important debts. In 1976 the Karolos Fix Brewery S.A. decided to
negotiate development projects for two of its properties in Syngrou
Avenue and Patission Road in Athens, where two of its factories were
situated. The company expected these projects to enable it to overcome
its financial difficulties. The negotiations concerned in particular
a project for building a complex of offices and shops on the Syngrou
Avenue plot, which project appeared to be supported by the National
Bank of Greece, a State controlled bank and the main creditor of the
company.
19. In 1976 the company's factory in Syngrou Avenue ceased to
operate. The functioning of the malt factory in Patission Road was
strongly criticised as causing important environmental nuisances; the
factory also ceased to operate later in the same year. In 1979, the
company obtained from the Athens Urbanism Office of the Ministry of
Urbanism, Housing and Environment a permit for building a complex of
offices and stores in its Syngrou Avenue property (building permit
2128/79).
20. On 9 September 1979 the Municipal Council of the City of Athens
(Dioikitiko Symvoulio Dimou Athineon), by its decision (praxi) 595/1979
concerning town planning, designated the property in Patission Road as
an area to be used as a youth centre and a public park. This decision
was confirmed in 1980 (praxi 201/17.3.1980). However, these decisions
were not submitted for approval to the competent Minister and to the
Prefecture of Athens (Nomarchia Athinon), although such approval was
necessary for the implementation of the plan.
21. A similar decision was issued on 28 April 1980 (No. 355/1980)
with regard to the property in Syngrou Avenue. The Municipal Council
adopted a town plan in which the Syngrou Avenue plot was designated as
area to be turned into a public park. On 30 June 1980, the Municipal
Council rejected an appeal against the town plan and confirmed its
previous decision (praxi 602/30.6.1980).
22. The applicants submit that as a result of the above the
enterprises negotiating with the company retracted. Moreover, the
National Bank of Greece stopped the financing of the company's
projects.
23. On 22 February 1981 the Municipality of Athens planted trees in
a part of the site in Syngrou Avenue over which ownership was disputed
between the State and the company. Upon request by the latter, the
Prosecutor of the Athens Court of Appeal (Eisageleas ton en Athinais
Efeton), ruling provisionally on the occupation of the Syngrou Avenue
plot, ordered, on 3 November 1981, the Municipality of Athens and any
other third party to cease the occupation of the litigious site. The
applicants state that employees of the Municipality of Athens
continuously look after the plants and have turned a part of the plot
into a public park.
24. At the same time signposts were erected with the words "Area to
be expropriated". Similar signposts were placed later on the site in
Patission Road. The company protested in vain requesting that the
signposts be removed. The Mayor of Athens declared in speeches and to
the press that the said signposts emphasised the will of the City of
Athens to acquire the land.
25. As the company's commercial operations went on declining, the
General Meeting of the Shareholders decided, on 10 August 1983, to wind
up the company and appointed a liquidator.
26. On 8 August and 9 November 1983 the company, through its
liquidator appointed by the General Meeting of the Shareholders, lodged
with the First Instance Civil Court of Athens (Polymeles Protodikeio)
two actions against the Greek State, the Municipality of Athens and the
Mayor of Athens personally. It claimed compensation for the damage it
had suffered from the activities and declarations of the Municipality
and of the Mayor.
27. Upon request of the Greek State, in its capacity of creditor of
the Karolos Fix Brewery S.A., the Minister of National Economy ordered
on 8 November 1983 by Decree No. 1802/1983 the winding up of the
company under the provisions of Articles 7 para. 3 and 9 of the Law
1386/1983 on "ailing" companies.
28. On 21 November 1983 the Municipal Council of the City of Athens
decided (praxi 1107/21.11.1983) to maintain its projects on the
company's plots. However, no expropriation proceedings were started.
29. On 28 June 1984 two liquidators were appointed by decision
(No. 6552/1984) of the Athens Court of Appeal (Efeteio Athinon) which
replaced the liquidator appointed by the General Meeting of the
Shareholders. The Court of Athens found in particular that, having
regard to the importance of the company's property and of the amount
of its debts, the appointment of two liquidators, one on the side of
the National Bank of Greece - the main creditor of the company - and
one on the side of the company itself, was required. The Court of
Appeal ruled that the liquidators should act in common.
30. On 13 July 1984 the First Instance Court (Polymeles Protodikeio)
of Athens gave two judgments (Nos 10848/1984 and 10849/1984) concerning
the two civil actions lodged by the company in August and
November 1983. The court found that the various actions complained of
could not be regarded as final administrative acts capable of causing
damage to the company's property rights.
The liquidators appointed on 28 June 1984 did not pursue any
remedies against the above judgments of the First Instance Court.
31. In an interview published on 11 November 1985 the Mayor of Athens
confirmed that the placement and maintenance of the signposts indicated
the City's will to acquire these properties. The Mayor mentioned that
representatives of foreign companies had negotiated projects for the
building of a multi-purpose commercial centre and asked for building
permits. He had refused and the Fix company had sued him personally
claiming compensation for the damage it had suffered.
32. On 18 July 1986 two of the applicant shareholders, namely Texema
S.A. and Kykladiki S.A., summoned the liquidators to take action in
order to safeguard the value of the properties.
33. On 1 March 1988 a building prohibition concerning the company's
property was enacted by the Municipal Council and published on
24 March 1988 in the Official Gazette (FEK 254/td/24.3.88). The
building prohibition was decided in order to permit the competent town
planning department of the Municipality to study possible amendments
of the town plan.
34. On 8 June 1988 the liquidators requested the City to remove the
signposts.
By letter of 5 October 1988 the Mayor answered as follows:
"The Municipality of Athens has aimed for years at acquiring the
areas of the old factories in order to give them to the public
use for the benefit of the city and its inhabitants. For this
reason the Municipal Council has passed since 1979 a series of
resolutions.
...
In view of the above, the desire of the Municipality of Athens
to acquire and develop the areas is apparent and it is this very
desire that is indicated by the signposts which have been
placed."
35. On 19 July 1988 the Division of town planning of the Municipality
of Athens proposed an amendment of the town plan concerning the plot
on the Syngrou Avenue. The area of the factory was designated as
"exhibition, commercial and cultural centre". The proposal aimed at
maintaining the skeleton of the existing factory building. The
amendment was submitted to the Municipal Council, which, in accordance
with the provisions of the Presidential Decree of 29 December 1986
(entered into force on 21 February 1987), was entrusted with approving
amendments of the town plan.
The Karolos Fix Brewery filed an appeal against this proposal but
this was dismissed on 7 October 1988, by the above mentioned Division.
On 4 May 1989 the Municipal Council adopted the proposal and its
decision was published in the Official Gazette, on 12 June 1989.
36. On 8 December 1988 the Division of town planning of the
Municipality of Athens elaborated an amendment of the town planning
concerning inter alia the Patission Road Plot. The Karolos Fix Brewery
filed an appeal against the proposal but this appeal was rejected, on
8 May 1989, by the above mentioned Division.
37. The Municipal Council adopted the proposed amendment by its
decision 1772/23.10.1989. This decision was published in the Official
Gazette on 5 December 1989.
38. On 8 April 1989 public work services of the Municipality of
Athens entered the company's plot in Patission Road and demolished the
surrounding walls of the old factory building. The Government state
that this operation took place because the factory yard was used as a
garbage storing place.
39. The liquidators requested the Prosecutor of the Athens Court to
order provisional measures against the occupation of the plot by the
Municipality of Athens. On 9 May 1989 the Prosecutor ordered the
Municipality of Athens to restore the previous status of the site and
prohibited any future disturbance. This order was confirmed by the
Prosecutor of the Court of Appeal on 22 November 1989. However the
situation remained unchanged.
40. As regards the Syngrou Avenue property the Municipality decided
on 23 August 1989 (Praxi 1480/23.8.1989) to expropriate that land. This
decision was published in the Official Gazette on 9 November 1989. The
company appealed, through its liquidators, to the Council of State
against the decisions relating to the property in Syngrou Avenue. No
appeal was lodged against the decision concerning the Patission Road
land.
41. On 21 October 1991, upon request by the National Bank of Greece,
the Court of Appeal replaced the two liquidators by the liquidator
proposed by the Bank.
B. Relevant domestic law
Constitutional protection of the right to property
42. Article 17 of the Constitution provides:
"1. Property is protected by the State; however, the rights
deriving from it cannot be exercised contrary to public
interest.
2. No one may be deprived of his property except for public
benefit duly proved, when and in the way provided by law
and always subject to full compensation corresponding to
the value of the expropriated estate..."
Legislation concerning town plans
43. The issuing and amendment of town plans is governed by the
Legislative Decree of 17.7/16.8.1923. As regards the authority which
is competent for issuing town plans, Article 3 para. 2 provides:
"Town plans with explanatory reports and memoranda shall be
approved by Presidential Decree issued following proposal
by the Minister of Transport and after the Municipal
Council concerned and the Board of public works have been
consulted. The opinion of the Municipal Council is
advisory and the Minister may in any case dismiss or amend
the town plans proposed by the Municipal Councils."
Article 8 para. 1 of the above-mentioned Legislative Decree
provides:
"In order to initiate the procedure for the implementation
of a new town plan, it is permitted to impose by
Presidential Decree for a maximum period of one year an
absolute building prohibition in all or in some of the
areas of the city or the community affected by the town
plan. The same decree may define the conditions under
which building operations may be conducted. The period of
one year may be extended for two further years if it is
proved that the studies concerning the new town plan have
substantially progressed. The above limitations and
prohibitions may create in favour of any injured party
rights to compensation by the State or the municipality."
44. Proposals for the amendment of a town plan can be made by any
natural person or legal entity of private or public law.
Municipalities may also submit such proposals in accordance with
Article 21 paras. 1, 2 and 3 of the Decree 3/22.4.1929 as modified by
the Presidential Decree 25-6/21.8.1943, which read as follows:
"1. The town plans or amendments of such plans submitted by
the municipalities for approval by the competent minister
shall be accompanied by all objections raised by the
citizens and the respective comments of the
municipalities...
2. No amendment of a town plan shall be submitted to the
minister if it does not serve public interest... Persons
whose property is affected by the proposed amendment shall
be notified the amendment. The municipality shall duly
certify such notifications.
3. Apart from the above individual notifications, a notice
should be placed in all central points of the city...
and... the proposed amendment shall be published in local
newspapers..."
45. As regards the Municipality of Athens the Presidential Decree of
29 December 1986, which came into force on 21 January 1987, provides
that the Municipal Council is entrusted with the approval of amendments
of the town plan and is empowered to issue building prohibitions in
accordance with Article 8 of the Decree 17.7/16.8.1923. In particular
Article 1 of the Presidential Decree provides:
"In the Municipality of Athens the amendment of the town
plan shall be effected by the decision of the Municipal
Council..."
Law 2190/1920 on limited companies
46. Article 18 para. 1 of Law 2190/1920 on limited companies
(anonymos etaireia) provides that "a limited company is represented
before courts by its board of directors, acting in common". Moreover,
in accordance with Article 22 para. 1 of the above Law, the board of
directors has competence to decide on all matters concerning the
administration of the company and the management of its property. The
members of the board of directors are accountable to the company for
any fault committed in the administration of the company's affairs.
According to Article 22-b of the above Law, the shareholders' general
assembly can decide, by absolute majority, that an action against a
member of the board of directors shall be brought before the courts.
Shareholders which hold one third of the shares may ask the board of
directors to sue a member of the board.
III. OPINION OF THE COMMISSION
A. Complaints declared admissible
47. The Commission declared admissible the applicants' complaints
that the various measures taken by the Municipality of Athens
constitute an unjustified interference with their right to peaceful
enjoyment of their possessions and that the Greek legal order prevents
them from having access to a court to seek judicial protection in their
capacity as shareholders of the Karolos Fix Brewery S.A.
B. Points at issue
48. The points at issue in the present case are:
- whether there has been a violation of Article 1 of
Protocol No 1 (P1-1) to the Convention ;
- whether there has been a violation of Article 6 para. 1
(Art. 6-1) of the Convention ;
- whether there has been a violation of Article 13
(Art. 13) of the Convention.
C. As regards Article 1 of Protocol No 1 (P1-1)
to the Convention
49. The applicant companies complain, in their capacity of
shareholders of the Karolos Fix Brewery S.A., that the various measures
taken by the Municipality of Athens constitute an interference with
their right to peaceful enjoyment of their possessions contrary to
Article 1 of Protocol No 1 (P1-1) which reads as follows:
"1. Every natural or legal person is entitled to the
peaceful enjoyment of his possessions. No one shall be
deprived of his possessions except in the public interest
and subject to the conditions provided for by law and by
the general principles of international law.
2. The preceding provisions shall not, however, in any way
impair the right of a State to enforce such laws as it
deems necessary to control the use of property in
accordance with the general interest or to secure the
payment of taxes or other contributions or penalties."
50. They allege that the measures complained of constitute serious
hindrances in the exercise of their right to peaceful enjoyment of
their possessions amounting to a de facto expropriation. In their view,
these measures are not in the public interest, they have no legal basis
in Greek or international law and they are, in any event,
disproportionate to the possible aims pursued. The applicants conclude
that their rights under Article 1 of Protocol No 1 (P1-1) have been
violated.
51. The Government find that the facts of the case do not disclose
any interference with the company's property rights other than those
resulting from recent building prohibitions which are manifestly lawful
and obviously in the public interest.
i. The existence of an interference with the applicants' rights
under Article 1 of Protocol No 1 (P1-1)
52. The applicants submit that the activities of the Municipality of
Athens in the last thirteen years prevent them from exercising their
right to peaceful enjoyment of their possessions as shareholders of the
Karolos Fix Brewery S.A. In this respect they criticise the placement
of signposts with the words "Area to be expropriated" on the company's
properties and the repeated declarations of the Mayor of Athens that
the municipality would acquire the company's land. This prejudicial
situation as regards the financial interests of the company and its
shareholders was further aggravated by the occupation of the Syngrou
Avenue property in 1981 and of the Patission Road property in 1989.
53. The applicants allege that as a result of these facts the company
has been prevented from making an effective use of its properties
while, at the same time, no formal expropriation procedures were
initiated.
54. They submit that as a result of the fact that they could not make
an effective use of the company's property in the last ten years, its
debt increased.
55. The Government underline the fact that, despite the placement of
the signposts, no formal proceedings were initiated and no restrictions
as to the use of the properties were imposed other than those already
existing because of mortgages or confiscation requests due to the
important debts of the company. Moreover, the town planning decisions
taken by the Municipal Council in 1979 and 1981 were obviously not
pursued since no further action with a view to the expropriation was
taken. The question of expropriation was raised again later, namely in
1988, when the Municipal Council decided to initiate procedures aiming
at expropriating both properties in question. Under these
circumstances, no continuing situation can be found.
56. Furthermore, in the Government's view, neither the placement of
signposts nor the various declarations to the press can be regarded as
executory administrative acts capable of affecting the company's
rights. Furthermore, the planting of trees in the Syngrou Avenue plot
cannot be regarded as an interference with the company's property
rights, since such rights are not established, the ownership over the
planted area being in dispute. As regards the alleged occupation of the
Patission Road plot, the Government point out that the Municipality of
Athens intervened, without challenging the company's ownership, for the
sole purpose of cleaning the area of the discontinued factory from
garbage left there.
57. The Government submit that the only measure which could have
affected the company's rights on its asset on Patission Road is the
Municipal Council's decision of 23 October 1989 (Decision
1772/23.10.89) to amend the town planning. As from its publication in
the Official Gazette on 5 December 1989, this decision restricted the
company's right to freely dispose of its asset. However, before that
date, no restrictions whatsoever were imposed and these measures were
taken after the introduction of the application. The company's
property rights over the Syngrou Avenue plot were not affected until
the provisional building prohibition decided in March 1988 and the
expropriation decision taken by the Municipality of Athens on
23 August 1989 and published in the Official Gazette on
9 November 1989. The Government submit that these acts are lawful and
manifestly in the public interest, since they obviously aim at
rehabilitating the discontinued factories of the Karolos Fix Brewery
S.A. by creating public recreation areas and cultural centres, and that
until termination of the expropriation procedures the property of the
land remains with the company.
58. The Government conclude that in these circumstances no
interference with the applicants' rights can be found.
59. The Commission notes that the applicant's rights at issue are
their rights as majority shareholders in the company Karolos Fix
Brewery S.A. The measures complained of were directed against the
company but also indirectly affected the applicant's rights.
Consequently, insofar as there has been an interference with the
company's property rights, this interference must be considered to
extend to the applicants' property rights as well.
60. As regards the Government's contention that no continuing
situation can be found, the Commission recalls that in its decision on
the admissibility of the application it considered that the applicants'
complaint referred to a continuing situation which originated in 1979
and 1981 but persisted after 20 November 1985, the date on which the
right of individual petition took effect.
61. The Commission finds, contrary to the Government's submission,
that the subject matter of the complaint is not a specific isolated
administrative act, but the prolonged and continuing situation created
by the activities and acts of the Municipality of Athens by which,
without introducing a formal expropriation procedure, this authority
conveyed to the public its intention to expropriate the company's land.
Originating in the decisions of the Municipal Council in 1979 and 1980
to designate the company's properties as areas to be expropriated, this
continuing threat of imminent expropriation was further manifested and
aggravated by the placement of signposts with the words "Area to be
expropriated" and by the Mayor's relevant public declarations. The
planting of the trees in the disputed part of the Syngrou Avenue plot
in 1981 and the Municipality's intervention on 8 April 1989 which led
to the demolition of the factory's walls are also to be regarded as
elements of the situation complained of. As to the latter event the
Commission recalls that facts which occur after the introduction of the
application and even after the Commission's decision on the
admissibility of the application can be taken into account, in so far
as they constitute a continuation of facts underlying the complaints
declared admissible (cf. Eur. Court H.R., Rieme judgment of
22 April 1992, Series A No 226-B, p. 67, para. 51).
62. The Commission considers that the situation as described above
should in principle be examined as a whole. This is because, even
though the various measures are not of the same nature and are not
necessarily legally connected, they were supplementary to each other,
they form part of the same operation and they all appear to have the
same purpose, namely to inform the public and any interested person of
the planned expropriation of the properties at issue.
63. As regards the decision to amend the town planning concerning the
property in Patission Road in October 1989 and the formal decision to
expropriate the Syngrou Avenue plot in August 1989 the Commission finds
that they should also be taken into account when assessing the
situation. However, the Commission notes that the applicants did not
appeal against these decisions.
64. The Commission has also examined the Government's argument that
in the absence of enforceable administrative decisions the company's
property rights remain intact and that, therefore, no interference with
such rights can be established. It finds that, in the present case, the
repeated declarations of officials of the administration that the
Municipality of Athens will acquire the company's land and, above all,
the placement and maintenance of signposts indicating that the area
would be expropriated even though they left intact in law the company's
property rights could in practice affect substantially the
possibilities to exercise these rights.
65. Although the applicants have not proved that the devaluation of
their shares was the direct result of the situation described above,
it is, in the Commission's view, established that these measures must
have affected the company's capacity to negotiate development projects
for its properties. Notwithstanding the absence of formal expropriation
proceedings until 1989 the impression was created that the Municipality
of Athens would proceed to the expropriation whenever it found it
expedient to do so. Therefore, the Commission finds that the situation
created by the placement of the signposts and the repeated declarations
of the Municipality's intention to acquire the company's land amounts
to an interference with the applicants' right to peaceful enjoyment of
their possessions.
ii. The justification of the interference with the applicants'
rights under Article 1 of Protocol No 1 (P1-1)
66. Article 1 of Protocol No 1 (P1-1) comprises three distinct rules:
the first rule, set out in the first sentence of the first paragraph,
is of a general nature and enunciates the principle of the peaceful
enjoyment of property; the second rule, contained in the second
sentence of the first paragraph, covers deprivation of possessions and
subjects it to certain conditions; the third rule, stated in the second
paragraph, is concerned, amongst other things, with a right of the
State to control the use of property (Eur. Court H.R., Sporrong and
Lönnroth judgment of 23 September 1982, Series A no. 52, p. 24,
para. 61).
67. These rules are not "distinct" in the sense of being unconnected:
the second and third rules are concerned with particular instances of
interference with the right to peaceful enjoyment of property and
should therefore be construed in the light of the general principle
enunciated in the first rule (Eur. Court H.R., James and Others
judgment of 21 February 1986, Series A no. 98, p. 30, para. 37 in
fine).
68. The applicants have alleged that the situation they complain of
amounts to a de facto expropriation.
69. The Commission does not overlook the fact that the threat of an
imminent expropriation reduced substantially the possibilities of
disposing effectively of the properties concerned and could have
negative consequences on their value. However, it is clear that the
company's property rights did not disappear and that the company did
not lose all ability to dispose of the land at issue (cf. mutatis
mutandis Eur. Court H.R. Papamichalopoulos and Others judgment of
24 June 1993, Series A no. 260-B, para. 45). Therefore, there was no
de facto expropriation in the present case.
70. Furthermore, the situation created by the manifestation of the
Municipality's intention to acquire the land had no purpose to control
the use of the company's property. The Commission finds that the
situation complained of cannot, therefore, be regarded as a measure to
control the use of property.
71. The fact that the situation complained of does not fall within
the ambit either of the second sentence of the first paragraph or of
the second paragraph does not mean that the interference with the said
right did not violate the rule contained in the first sentence of the
first paragraph. For the purposes of the latter provision, the
Commission must determine whether a fair balance was struck between the
demands of the general interest of the community and the requirements
of the protection of the individual's fundamental rights. The
requirement of this balance is inherent in the whole of the Convention
and is also reflected in the structure of Article 1 (cf. Eur.Court
H.R., above mentioned Sporrong and Lönnroth judgment, p. 26, para. 69)
72. The applicants submit that the situation complained of is not in
the public interest, it has no legal basis in Greek or international
law and is, in any event, disproportionate to the possible aims
pursued.
73. The Government submit that the transparency of the discussions
which take place within the framework of a collective institution
representing the people and aiming at satisfying the interests of the
community, such as the Municipal Council, is an essential element of
a democratic society. Through the mass media, the discussions,
intentions and even thoughts formulated are rapidly disseminated and
become known to the public in general as well as to any specifically
interested person. It cannot be excluded that, on the basis of the
information thus disseminated, citizens may evaluate the existing
perspectives of city planning and determine accordingly their attitude
in particular as regards development projects in a given area, but such
consequences should not be imputed to the authorities.
74. The Commission recalls that, in an area as complex and difficult
as the development of large cities, State authorities enjoy a wide
margin of appreciation in order to implement their town planning
policy. Nevertheless, the Convention organs must determine whether the
requisite balance was maintained in a manner consonant with the
individuals' right to peaceful enjoyment of their possessions (Eur.
Court H.R., above mentioned Sporrong and Lönnroth judgment, ibid.)
75. In the present case, the fact that the Municipality of Athens
made public its firm intention to proceed to the expropriation of the
company's properties can be regarded as being in the public interest,
to the extent that disseminating this information could contribute to
the public debate concerning the town planning of the City of Athens.
However, the dissemination of this information may, as in the present
case, affect the financial interests of individuals preventing them
from effectively exercising their rights.
76. In the Commission's view, the decisive feature in the applicants'
case is the fact that the threat of expropriation, as manifested
through various concrete preparatory acts and other actions of the
administration, was prolonged for almost ten years. The applicants were
left during the whole of this period in complete uncertainty as to the
fate of their properties since, on the one hand, no formal
expropriation proceedings had started and, on the other hand, the
envisaged expropriation discouraged in practice any potential
investors.
77. In addition, the Commission has regard to the fact that the
Municipality disregarded the orders of the Prosecutor of the Athens
Court of Appeal ruling provisionally on the occupation of the disputed
part of the Syngrou Avenue plot (see above para. 23) and ordering to
restore the previous status of the site of the Patission Road property
(see above para. 39).
78. Therefore, the Commission finds that the company bore an
individual and excessive burden which could have been legitimate only
if expropriation proceedings had been initiated within a reasonable
time enabling the company to obtain either the withdrawal of the
expropriation or a compensation in accordance with the relevant
provisions of domestic law.
79. As this did not occur in the present case, the fair balance
required under Article 1 of Protocol No 1 (P1-1) was upset.
Conclusion
80. The Commission concludes, by thirteen votes to two, that in the
present case there has been a violation of Article 1 of Protocol No 1
(P1-1) to the Convention.
D. As regards Article 6 para. 1 (Art. 6-1) of the Convention
81. The applicants allege that the Greek legal order prevents them
from having access to a court in order to seek judicial protection of
their rights in their capacity as shareholders. They invoke Article 6
para. 1 (Art. 6-1) of the Convention which, in so far as relevant,
reads as follows:
"In the determination of his civil rights and obligations
..., everyone is entitled to a fair ... hearing ... by a
... tribunal".
82. The applicants note that pursuant to the constant case-law of the
Court of Cassation (Areios Pagos) the constitutional protection of
property under Greek law is confined to rights in rem, excluding the
rights of shareholders. They submit that a complaint to the Greek
courts that their property rights as shareholders are violated by the
situation created by the activities of the Municipality of Athens would
be futile.
83. The Government submit that the question which arises under
Article 6 para. 1 (Art. 6-1) is not whether the rights of the
shareholders are protected as constitutional rights but whether they
are at all protected. They note in this respect that it is open to the
applicants to claim compensation for any damage suffered by them as a
result of the measures taken by the Municipality of Athens invoking
Article 20 of the Constitution and Article 105 of the Law introducing
the Civil Code.
84. The Commission first finds that Article 6 para. 1 (Art. 6-1) of
the Convention cannot be interpreted as requiring that rights of
shareholders should be granted specific constitutional protection in
the domestic legal order. Consequently, the alleged lack of
constitutional protection does not infringe the provision invoked.
85. The Commission further recalls that Article 6 para. 1 (Art. 6-1)
embodies the "right to a court", of which the right of access, that is
the right to institute proceedings before courts in civil matters,
constitutes one aspect (Eur. Court H.R., Golder judgment of
21 February 1975, Series A no. 18, p. 17, para. 36 ; Philis judgment
of 27 August 1991, Series A No 209, p. 20, para. 59).
86. It notes that in the present case the various acts and measures
taken by the Municipality of Athens, which constitute the subject
matter of the application, did not directly affect the applicant
shareholders but the company itself. It recalls that the applicant's
rights were indirectly affected by the challenged measures (see
para. 59 above).
87. Admittedly, Article 6 para. 1 (Art. 6-1) of the Convention
applies to all proceedings "the result of which is decisive for private
rights and obligations" (cf. Ringeisen judgment of 16 July 1971, series
A No 13, p. 39, para. 94). However, as regards the right of access to
court, Article 6 para. 1 (Art. 6-1) secures such a right only to
persons whose civil rights and obligations are directly affected and
constitute the subject matter of the dispute. As stated by the Court
in the abovementioned Golder judgment (ibidem), Article 6 para. 1
(Art. 6-1) secures to everyone the right to have any claim relating to
his civil rights and obligations brought before a court. A tenuous
connection or indirect consequences or repercussions do not suffice for
Article 6 para. 1 (Art. 6-1) (cf. mutatis mutandis Eur. Court H.R. Le
Compte, Van Leuven and De Meyere judgment of 23 June 1981, Series A
No 43, p. 21, para. 47).
88. Therefore, the fact that the applicants could not, in their
capacity as shareholders, bring before the domestic courts the claims
of the Karolos Fix Brewery S.A. against the Municipality of Athens
does not constitute a deprivation of the right of access to court.
Conclusion
89. The Commission concludes, by eleven votes to four, that in the
present case there has been no violation of Article 6 para. 1
(Art. 6-1) of the Convention.
E. As regards Article 13 (Art. 13) of the Convention
90. The applicants have further invoked Article 13 (Art. 13) of the
Convention which reads as follows:
"Everyone whose rights and freedoms as set forth in this
Convention are violated shall have an effective remedy before a
national authority notwithstanding that the violation has been
committed by persons acting in an official capacity."
91. The Commission found that Article 6 para. 1 (Art. 6-1) of the
Convention does not require that the present applicants be enabled, in
their capacity as shareholders, to exercise before domestic courts the
rights of the Karolos Fix Brewery S.A. against the Municipality of
Athens. In the Commission's view, Article 13 (Art. 13) of the
Convention, whose requirements are less strict than those of Article 6
para. 1 (Art. 6-1) (cf. Eur.Court H.R., above mentioned Philis
judgment, p. 23, par. 67), cannot be interpreted as requiring that
shareholders be allowed to pursue before national authorities remedies
against State measures which only indirectly affect their own rights.
Conclusion
92. The Commission concludes by nine votes to six, that there has
been no violation of Article 13 (Art. 13) of the Convention.
F. Recapitulation
93. The Commission concludes:
- by thirteen votes to two, that in the present case there has
been a violation of Article 1 of Protocol No 1 (P1-1) to the
Convention;
- by eleven votes to four, that in the present case there has
been no violation of Article 6 para. 1 (Art. 6-1) of the
Convention;
- by nine votes to six, that there has been no violation of
Article 13 (Art. 13) of the Convention.
Secretary to the Commission President of the Commission
(H.C. KRÜGER) (C.A. NØRGAARD)
(Or. English)
SEPARATE OPINION OF MR. H. DANELIUS
JOINED BY MM. C.A. NØRGAARD AND M. PELLONPÄÄ
While I agree with the Commission in concluding that neither
Article 6 nor Article 13 of the Convention has been violated in the
present case, I base my conclusions in regard to these Articles on the
following considerations.
When individuals choose to conduct certain activities through a
legal person, it follows that in some respects these individuals
transfer competence to act to the organs of that legal person, which
means that each individual can no longer act separately in these
respects. Thus, an individual who acquires shares in a company can be
considered thereby to have accepted that he must rely on the organs of
the company as regards the taking of measures to protect the economic
interests of the company, although such measures also indirectly affect
the property rights of the shareholders. The extent of such dependence
on the organs of the company may vary according to the applicable
domestic laws. However, it is a frequent feature of company laws that,
to a large extent, only the legal person through its competent organs,
and not the shareholders, has access to the courts in order to obtain
a determination of the civil rights of the company. Such a limitation
of the shareholders' access to the courts should be seen as a
consequence of the fact that, when becoming shareholders, the
individuals concerned agreed to act, as regards the affairs of the
company, through the organs of the company.
For these reasons, I take the view that Article 6 para. 1 of the
Convention has not been violated in the present case.
I consider that the same reasoning applies, mutatis mutandis, to
the complaint under Article 13 of the Convention, and I therefore find
no violation of that Article either.
(Or. English)
PARTIALLY CONCURRING AND PARTIALLY DISSENTING
OPINION OF MRS. G.H. THUNE (JOINED BY MR. J.A. FROWEIN)
While I agree with the Commission that there has been violation
of Article 1 of Protocol No. 1 and no violation of Article 6 in the
present case I am unable to share the Commission's opinion that
Article 13 has not been violated.
It is true that Article 6 para. 1 of the Convention cannot be
interpreted as requiring that shareholders be allowed to bring before
the domestic civil courts the claims of their company against third
persons. However, when the shareholders' property rights guaranteed
by Article 1 of Protocol No. 1 are - indirectly but necessarily -
affected by measures taken against the company and the company as such
is unable to react, Article 13 of the Convention requires that the
domestic legal order grants to the shareholders an effective remedy for
the protection of their rights.
As no such effective remedy existed in the present case (c.f.
Commission's Decision on the admissibility of this application)
Article 13 of the Convention has been violated.
(Or. English)
DISSENTING OPINION OF SIR BASIL HALL
JOINED BY MRS. J. LIDDY
1. With regret I do not share the opinion of the majority of the
Commission that there was a violation of the rights of the applicants
under Article 1 of Protocol No. 1 to the Convention in this case.
2. I agree that measures taken by the municipality of Athens in
relation to the immoveable property of the Karolos Fix Brewery S.A. may
well have constituted violations of that Company's entitlement under
Article 1 of Protocol No. 1 to the Convention to the peaceful enjoyment
of its possessions.
3. The Company, which was unable to meet its obligations was on
10 August 1983 put into liquidation at a General Meeting of its
shareholders. On 30 August 1983 liquidators were appointed by the
company in General Meeting. On 8 November 1983 Law 1386/83 was applied
which made special provision for liquidation. Liquidators (replacing
those appointed in General Meeting) were appointed by the Court, one
to protect the shareholders' interests and one to protect the interests
of the creditors, and in particular the principal creditor, the Bank
of Greece. From the 21 October 1991 there has been one liquidator only
appointed, on the proposal of the Bank of Greece.
4. Whether appointed by the Company in General Meeting or appointed
under Law 1386/83 the basic duties of liquidators are to get in the
assets, dispose of them to best advantage, and then, out of the
proceeds, to pay the administrative costs, to pay the Company's debts
to the extent that the funds realised allow, and if there is a surplus
to distribute it amongst the shareholders. In order to dispose of the
assets to best advantage they may continue to carry on the Company's
business.
5. The three applicant companies are shareholders in Karolos Fix
Brewery S.A. None is majority shareholder. Their shareholdings, added
together, amount to just over one-half of the total shareholding. They
complain that the measures taken by the Municipality of Athens
constitute a violation of their entitlement to the peaceful enjoyment
of their possessions, given by Article 1 of Protocol 1 to the
Convention.
6. As I have remarked above there may well have been violations of
the rights of Karolos Fix Brewery S.A. under that provision. The
question is whether the measures taken by the Municipality of Athens -
essentially the threat of acquisition and the interference with land
and buildings - also constituted a violation of the applicants' rights.
It does not appear that there was any interference with the applicants'
shareholding. Nor is it established that as a result of the measures
taken by the Municipality of Athens there was a diminution in the value
of their shares. There is indeed no indication that, after realisation
of the Company's assets, there is likely to be a surplus for
distribution to shareholders. The question is then whether the
applicants have suffered a violation of Article 1 para. 1 by reason of
interference by the Authorities with possessions which are under
National Law not possessions of the applicants, but possessions of a
Company in which the applicants hold shares.
7. In my opinion as a matter of general principle Article 1 gives
rights only to the natural or legal person whose possessions have been
interfered with. It does not give rights to others indirectly
affected, such as the shareholders of a Company to which the
possessions in question belong, or indeed the creditors of such a
company in liquidation who might well be more directly affected than
the shareholders.
8.8. The Commission in its admissibility decision placed much weight
in considering whether the veil of the Company's legal personality
should be lifted on the argument that the Company "has been essentially
under effective state control"and "cannot therefore be expected to
lodge an application with the Commission". Here I would only comment
that I have noted the observation of the Government that the Company
was not being administered by the Organisation for Redressment of
Undertakings acting under Article 8 of Law 1386/83 but by liquidators
appointed by the Court under Articles 7 and 9. The liquidators' duties
in such a special liquidation are, it is stated, not substantially
different from those in an ordinary liquidation.
I can see nothing which would have prevented the Company through
its liquidators lodging an application under Article 25 of the
Convention had it been considered that the course would have
contributed to the effective liquidation of the Company.
9. I conclude that none of the applicant companies has established
that there has been an interference with the peaceful enjoyment of any
of its possessions.
10. The three applicant companies also complain that the Greek legal
order prevents them from having access to a Court to seek judicial
protection in their capacity as shareholders in the Karolos Fix Brewery
S.A. in violation of Article 6 para. 1 of the Convention.
11. The contention of the applicants is, as I understand it, that
they should have been able to institute proceedings in the National
Courts to assert the rights of Karolos Fix Brewery S.A. if the company
refused through its liquidators to take such action. In my view
neither Article 6 nor Article 13 requires a member state to give such
a remedy.
If I misunderstand their contention, and it is rather that the
Greek legal order as a generality gave insufficient protection to them
as shareholders, it is not the function of the Convention organs to
make a general examination of the national law. In the particular
circumstances of the case I do not discern any lack of access for
determination of a civil right nor any lack of a remedy for an arguable
violation of the Convention.
12. I therefore too conclude that there was no violation of Article 6
or Article 13 of the Convention.
(Or. English)
PARTIALLY DISSENTING OPINION BY MR. L. LOUCAIDES
JOINED BY MM. F. ERMACORA, J.-C. SOYER AND C.L. ROZAKIS
I regret that I cannot share the Commission's opinion that there
has been no violation of Articles 6 and 13 of the Convention in the
present case.
It is of course reasonable, in principle, to exclude the
individual shareholders from acting on behalf of the legal person of
their company. However, where the company is unable or unwilling to
take the necessary steps before the competent judicial authorities to
protect its own interest, it must be possible to an individual or to
a group of individuals who hold a substantial shareholding and whose
rights are indirectly, though necessarily, affected to exercise the
company's rights. This should be in particular the case, where the
company is under the effective control of the State and the measure
allegedly affecting its rights are taken by State organs.
The Government submitted that the applicants, in their capacity
of shareholders could still, notwithstanding the winding up process
under the law on "ailing enterprises", exercise an effective control
on the liquidators, by taking appropriate action against them before
the courts. However, the winding up of the company was effected under
the supervision of the O.A.E., which is the State agency responsible
for the "ailing companies". The "Karolos Fix Brewery S.A." was thus in
liquidation and under the effective control of the State.
Under these circumstances, Article 6 para. 1 requires that the
applicant shareholders be entitled, by lifting the veil of the
company's legal personality, to bring effectively before the courts the
company's claims against the Municipality of Athens. This possibility
was not offered to the applicants shareholders under domestic law.
In this respect it is useful to refer also to the decision on the
admissibility whereby it was found that no effective remedies were
available to the applicants in respect of the interference with their
rights under Article 1 of Protocol No. 1 complained of in this case.
I believe that so long as the Commission found it established that
there has been a viuolation in respect of such complaint a finding of
a violation of the right to have access to court under Article 6 of the
Convention should, in the circumstances of this case, as explained
above, follow as a corollary of the first finding.
For these reasons I conclude that in the present case there has
been a violation of Article 6 para. 1 of the Convention.
Having regard to this conclusion, I take the view that it is not
necessary to examine the case under Article 13 as its requirements are
less strict and are absorbed by those of Article 6.
APPENDIX I
HISTORY OF THE PROCEEDINGS
Date Item
_________________________________________________________________
29 November 1988 Introduction of application
21 March 1989 Registration of application
Examination of admissibility
13 February 1990 Commission decision to communicate
the case to the respondent Government
and to invite the parties to submit
observations on admissibility and
merits
16 May 1990 Government's observations
4 July 1990 Applicant's observations in reply
8 July 1991 Commission's decision to hold a
hearing
12 February 1992 Hearing on admissibility and
merits. Commission's decision to
declare application admissible
Examination of the merits
22 April 1992 Decision on admissibility
communicated to parties. Invitation
to parties to submit further
observations on the merits
25 June 1992 Government's observations
4 July 1992 Commission's consideration of state
of proceedings
28 September 1992 Applicant's observations
17 October 1992, Commission's consideration
13 February 1993 of state of proceedings
19 February 1993 Government's comments
3 July 1993 Commission's consideration
15 January 1994 of state of proceedings
10 March 1994 Commission's deliberations on the
merits, final vote and consideration
of text of the Report
10 March 1994 Adoption of Report
Full & Egal Universal Law Academy