THIRD SECTION
Application no. 61907/11
Miroslav BALÁŽ
against Slovakia
lodged on 30 September 2011
STATEMENT OF FACTS
The applicant, Mr Miroslav Baláž, is a Slovak national, who was born in 1960 and lives in Trenčianske Teplice. He is represented before the Court by Mr D. Chlapík, a lawyer practising in Žilina.
A. The circumstances of the case
The facts of the case, as submitted by the applicant, may be summarised as follows.
The applicant ran a business with real estates.
On 19 July 1997 the Trenčín Tax Office imposed an additional income tax on the applicant amounting to 112,637 euros (EUR). That sum was increased by 100% as a sanction. Accordingly, the applicant owed the overall sum of EUR 225,274.
On 6 February 1998 the Trenčín Tax Office decided to secure the claim by prohibiting the applicant from selling or otherwise disposing of his entire real property. The value of that property was EUR 5,486,000. The applicant unsuccessfully appealed against the decision to secure the claim.
The applicant also appealed against the decision of 19 July 1997 on additional tax. Following several tax controls the Tax Office, on 18 March 2002, established that the outstanding tax owed by the applicant amounted to EUR 2,982 instead of EUR 112,637.
On 7 May 2004 the Tax Office modified its decision on securing that claim in that the applicant was prohibited from availing himself of his property only in respect of one real estate.
On 2 June 2004 the applicant paid the outstanding sum of EUR 2,982. On that ground the Tax Office, on 8 June 2004, cancelled in its entirety its decision of 6 February 1998 to secure the claim.
Subsequently the applicant claimed compensation for damage from the State represented by the Ministry of Finance under the State Liability Act 1969. He argued that he had been prevented, for more than six years, from selling or otherwise availing himself of his property. That interference had been prompted by the above decision to secure the payment of his alleged tax debt the amount of which had been determined erroneously.
On 15 October 2008 the Trenčín District Court dismissed the action. It established that the decision of 6 February 1998 had not been quashed as being unlawful. Thus the requirement set out in section 4 of the State Liability Act 1969 had not been met and the applicant’s claim could not be granted. Additionally, the District Court held that the applicant had sufficiently shown neither the existence of the damage claimed nor any causal link between the alleged damage and the decision in issue. Furthermore, it had been open to the applicant to ask for leave to avail himself of his property with the authorisation of the tax authority. At the relevant time the major part of the applicant’s property had been the subject-matter of enforcement proceedings. The applicant had therefore anyway been prevented from availing himself of it.
On 21 October 2009 the Trenčín Regional Court upheld the first-instance judgment. It held that the decision of 6 February 1998 to secure the claim had not been quashed as being unlawful. The Tax Office had first modified that decision by reducing the amount to be secured. On 8 June 2004 that authority quashed the decision of 6 February 1998 in its entirety of its own initiative after the applicant had paid the sum due.
In those circumstances, the statuory requirement that the decision should be quashed as being unlawful was not met. The remaining arguments put forward by the District Court were superfluous.
On 30 November 2010 the Supreme Court dismissed the appeal on points of law in which the applicant argued that the lower instances had erred from the procedural point of view.
On 13 April 2011 the Constitutional Court dismissed the complaint in which the applicant alleged a breach of Article 6 § 1 of the Convention and of Article 1 of Protocol No. 1 in the above proceedings. It held that there was nothing to show that the ordinary courts had dealt with the case in an unfair manner or that their decisions were arbitrary. As to the alleged breach of the applicant’s right to peaceful enjoyment of his possessions, the Constitutional Court considered that it would be entitled to examine that complaint only if the ordinary courts had breached the applicant’s rights under Article 6 § 1 of the Convention or its constitutional equivalent.
B. Relevant domestic law
Section 1 of Act No. 58/1969 on the liability of the State for damage caused by a State organ’s decision or by its erroneous official action (“the State Liability Act 1969”) provides that the State is liable for damage caused by unlawful decisions delivered by a public authority in the context of, inter alia, administrative proceedings.
Pursuant to section 3, except where it is justified by special circumstances, a claim for damages in respect of an unlawful decision may be granted only after the party concerned has used the remedy available against such decision.
Pursuant to section 4(1), a claim for damages can only be lodged after the decision by which damage was caused has been quashed by the competent authority as being unlawful. Section 4(2) provides for an exception in that a claim for damages may be lodged in respect of a decision which can be enforced irrespective of its final effect where such decision was quashed or modified as a result of a remedy lodged against it.
COMPLAINT
The applicant complains under Article 1 of Protocol No. 1 that he suffered considerable pecuniary damage in that he had been prohibited from availing himself of his property for more than six years, and that the State failed to compensate him for that restriction which was based on an erroneous determination of his tax debt. The interference was unlawful and disproportionate in the circumstances.
QUESTIONS TO THE PARTIES
1. Has there been an interference with the applicant’s right to peaceful enjoyment of possessions, within the meaning of Article 1 of Protocol No. 1 as a result of the order prohibiting him from availing himself of his real property and the dismissal of the claim for damages which the applicant lodged after it had been established that the tax authority had erred in the assessment of his tax debt?
2. If so, was that interference necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or penalties?
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