CASE OF ALENTSEVA v. RUSSIA

FIRST SECTION

CASE OF ALENTSEVA v. RUSSIA

(Application no. 31788/06)

JUDGMENT

STRASBOURG

17 November 2016

FINAL

24/04/2017

This judgment has become final under Article 44 § 2 of the Convention. It may be subject to editorial revision.

In the case of Alentseva and others v. Russia,

The European Court of Human Rights (First Section), sitting as a Chamber composed of:

András Sajó, President,
Mirjana Lazarova Trajkovska,
Khanlar Hajiyev,
Paulo Pinto de Albuquerque,
Linos-Alexandre Sicilianos,
Erik Møse,
Dmitry Dedov, judges,
and Abel Campos, Section Registrar,

Having deliberated in private on 13 October 2015, 6 September 2016 and 11 October 2016,

Delivers the following judgment, which was adopted on that last mentioned date:

PROCEDURE

1. The case originated in an application (no. 31788/06) against the Russian Federation lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (“the Convention”) by a Russian national, Ms Svetlana Aleksandrovna Alentseva (“the applicant”), on 24 May 2006.

2. The applicant was represented by Mr A. Akopov, a lawyer practising in Moscow. The Russian Government (“the Government”) were represented by Mr G. Matyushkin, Representative of the Russian Federation to the European Court of Human Rights.

3. The applicant alleged, in particular, that she had been deprived of her flat in contravention of Article 1 of Protocol No. 1 to the Convention and that her eviction had amounted to a violation of Article 8 of the Convention.

4. On 7 January 2014 the President of the First Section decided to grant the application priority under Rule 41 of the Rules of the Court and to give the Government notice of the complaints under Article 1 of Protocol No. 1 to the Convention and Article 8 of the Convention. The remainder of the application was declared inadmissible.

THE FACTS

I. THE CIRCUMSTANCES OF THE CASE

5. The applicant was born in 1974 and lives in Moscow.

A. Transactions in respect of the flat later purchased by the applicant

6. Prior to its privatisation, the flat at 10-3-34 Bolshoy Rogozhskiy Pereulok, Moscow, had been owned by the City of Moscow. R. had resided there as a tenant under the social housing agreement with the City. On 31 May 1993 the title to the flat was transferred to R. under a privatisation scheme.

7. On 12 August 1996 R. died.

8. In October 1999 Yar. applied to a notary seeking recognition as R.’s heir. In support of his application, Yar. submitted a will allegedly signed by R. on 9 February 1996.

9. On 2 June 2000 the notary granted the request and issued a certificate confirming, inter alia, that Yar. had inherited R.’s flat.

10. On 20 June 2000 the Moscow City Committee for Registration of Real Estate Transactions (the “City Registration Committee”) registered the certificate, confirming Yar.’s title to the flat.

11. On 13 July 2000 Yar. sold the flat to the applicant. On an unspecified date the City Registration Committee registered the transaction and issued the relevant deed, confirming the applicant’s title to the flat. The applicant moved in and resided in the flat. After the birth of her daughter in 2004, she resided there with her daughter.

B. Criminal proceedings against Yar.

12. On an unspecified date the authorities opened a criminal investigation concerning the forgery of the will issued on behalf of R.

13. On 6 June 2001 the Taganskiy District Court of Moscow found Yar. guilty of fraud and sentenced him to five years’ imprisonment and confiscation of property. In particular, the court established that Yar., acting in concert with other persons, whose identity was not known, had fraudulently acquired R.’s flat and sold it to the applicant on the basis of a forged will. The judgment became final on 25 July 2001.

C. Termination of the applicant’s title to the flat and eviction proceedings

14. On 5 March 2002 the prosecutor brought a civil claim on behalf of the Department for Housing of the City of Moscow (the “Housing Department”) seeking (1) the annulment of R.’s will and of the applicant’s title to the flat; (2) the applicant’s eviction; (3) restitution of the flat to the City of Moscow; and (4) annulment of the purchase agreement between Yar. and the applicant, and the reimbursement by Yar. of the amount the applicant had paid for the flat.

15. On 16 December 2003 the District Court examined the case in the applicant’s absence and granted the prosecutor’s claims in full. The applicant appealed.

16. On 16 June 2004 the Moscow City Court held that the District Court had failed to duly inform the applicant of the date and time of the hearing. It quashed the judgment of 16 December 2003 and remitted the case for fresh consideration.

17. In the new set of proceedings the applicant brought a counterclaim against the City of Moscow, seeking to be recognised as a bona fide purchaser of the flat.

18. On 14 November 2005 the District Court invalidated R.’s will and Yar.’s title to the flat. The court established that the property was escheat and ordered its restitution to the City of Moscow. It also ordered the applicant’s eviction. The court dismissed the remainder of the prosecutor’s claims concerning the annulment of the sale contract concluded by Yar. and the applicant, and the former’s obligation to return the sum paid by the applicant to her. As regards the applicant’s counterclaim, the court recognised that she had bought the flat in good faith. However, it found that because Yar. had acquired R.’s flat fraudulently, he had, in fact, stolen it from the City of Moscow and the latter had the right to reclaim the flat from the applicant, despite the fact that she was a bona fide purchaser.

19. On 24 January 2006 the City Court upheld the judgment of 14 November 2005 on appeal.

20. On 23 March 2006 the district bailiff’s service instituted enforcement proceedings in respect of the judgment of 14 November 2005.

21. On 2 April 2008 the applicant and her daughter were evicted from the flat. According to the applicant, they had to move in with her parents and her brother and his family.

22. According to the Government, on 9 April 2010 the flat was reassigned to Sh., who had been on the social housing waiting list for twenty-five years.

D. Recognition of the City’s title to the flat

23. On 12 May 2011 the District Court recognised the City’s title to the flat. In particular, the court established that R. had died intestate and without heirs and that her flat should have been transferred to the State as escheat property. The court also terminated the applicant’s title to the flat.

24. On 22 September 2011 the City Court upheld the judgment of 12 May 2011 on appeal.

II. RELEVANT DOMESTIC LAW AND PRACTICE

A. Federal Law on State registration of titles to, and transactions in respect of, real property

25. Pursuant to the Federal Law On State registration of titles to, and transactions in respect of, real property, adopted on 21 July 1997 (as amended), the State confirms the acquisition, transfer or termination of the title to real property by means of state registration (Article 2). Once the state registration authorities receive the application for state registration of the title to real property, they are under obligation to conduct an expert review as regards the lawfulness of the transactions underlying the acquisition, transfer or termination of the title. They are further required to establish that there are no conflicting interests in respect of such property and verify whether the application should be accepted (Article 13 § 1). When applying for state registration, the parties to the transaction underlying the acquisition, transfer or termination of the title to real property should present a valid ID. If the application is lodged by the parties’ representative(s), he or she should submit a duly notarised authority form (power of attorney) (Article 16 §§ 1 and 2).

B. Civil Code of the Russian Federation

26. The relevant provisions of the Civil Code of the Russian Federation provide as follows:

Article 167. General provisions on the consequences of declaring
a transaction invalid

“1. The invalidation of a transaction shall have no legal consequences except for those connected with the invalidation, and the transaction shall be considered invalid from the date of the transaction.

2. If a transaction has been declared invalid, each of the parties shall return to the other the consideration it has received under the transaction, and if the return is impossible in kind (including where the transaction concerns the use of property, work performed or services rendered), its cost shall be reimbursed in the form of money - unless other consequences of the invalidity of the transactions have been stipulated by law.

3. If it follows from the content of the disputed transaction that it may not be terminated until a future date, the court, while declaring the transaction invalid, shall fix a future date for its termination.”

Article 301. Reclaiming property from a person’s unlawful possession

“An owner has the right to recover his or her property from the unlawful possession of a thirty party.”

Article 302. Reclaiming property from a bona fide purchaser

“1. If a property has been purchased from a person who had no right to sell it, and the purchaser is unaware and could not have been aware [of this fact] (the bona fide purchaser), the owner shall have the right to reclaim this property from the purchaser, if the said property was lost by the owner or by the person into whose possession the owner has conveyed the property, or if it was stolen from either of them, or if it left their possession in another way against their will.

2. If the property has been acquired gratuitously from a person who had no right to convey it, the owner shall have the right to reclaim the property in all cases.

3. Money and bearer securities shall not be reclaimed from a bona fide purchaser.”

Article 1151. Inheritance of escheat property

“1. If there are no [legal or testamentary heirs], or if none of the heirs has a right to inherit, or if all are disinherited, or if all have refused the inheritance and none has indicated that he or she has refused it in favour of another heir, the property is considered escheat.

2. ... If [escheat property consisting of residential premises] is located in ... the City of Moscow ..., title shall be transferred by operation of the law to [the City of Moscow. The premises shall form part of the residential social housing stock.

3. The procedure for the succession and registration of escheat property that has reverted by operation of the law to the Russian Federation, and its transfer to the constituent entities of the Russian Federation and municipalities, shall be governed by law.”

Article 1152. Acceptance of inheritance

“1. In order to acquire rights in respect of inheritance, an heir should accept the inheritance.

2. In order to acquire rights in respect of escheat property, acceptance of inheritance is not required.”

Article 1154: Time-limit for claiming inheritance

“1. Inheritance must be claimed within six months of the date of [the death of the person] ...

3. Persons whose inheritance rights arise only by virtue of [no claim being submitted] by other heirs may claim the inheritance within three months of the expiry of the time-limit set forth in paragraph 1.”

C. Ruling of the Constitutional Court of the Russian Federation concerning reclaiming of property from a bona fide purchaser

27. By its ruling of 21 April 2003, 6-P, the Constitutional Court of the Russian Federation interpreted Article 167 of the Code as not allowing the original owner to reclaim his property from a bona fide purchaser unless there was a special legislative provision to that effect. Instead, a claim vindicating prior rights (виндикационный иск) could be lodged under Article 302 of the Code if the conditions indicated in paragraphs 1 and 2 were met, in particular if the property had left the owner’s possession without his or her intention to divest himself of it, or if the property had been acquired gratuitously.

D.  Ruling of the Plenary of the Supreme Court and the Plenary of the High Commercial Court of the Russian Federation concerning reclaiming of property from a bona fide purchaser

28. Further interpretation of Article 302 of the Civil Code was provided by the Plenary of the Supreme Court of the Russian Federation and the Plenary of the High Commercial Court of the Russian Federation. Their joint ruling of 29 April 2010, no. 10/22 “On certain questions arising in judicial practice in respect of resolution of disputes connected with the protection of property rights and other real rights” stated as follows:

“39. Article 302 § 1 of the Civil Code of the Russian Federation provides that the owner may reclaim his property ... regardless of the respondent party’s claim that he or she is a bona fide purchaser, if he proves that the property has left his possession ... against his will.

The fact that the transaction ... has been declared invalid does not by itself signify that the property left the [owner’s] possession against his or her will. It is incumbent on the court to establish whether the owner expressed his or her will to convey [the property] to another person.”

29. In its ruling no. 188‑O‑O of 27 January 2011, the Constitutional Court relied on the interpretation of Article 302 provided by the Plenaries when verifying the said Article’s compliance with the Constitution.

E. Ruling of the Plenary of the Supreme Court concerning inheritance

30. On 29 May 2012 the Plenary of the Supreme Court of the Russian Federation adopted Ruling no. 9 on Judicial Practice Concerning Inheritance. As regards escheated property, the Plenary noted as follows:

“50. Escheat property in the form of housing located [in the City of Moscow] ... . as of the date of [the death of the property’s owner] shall be transferred to ... the City of Moscow ... .

A certificate confirming the inheritance of title to escheat property shall be issued to ... the City of Moscow ... in accordance with the procedure applicable to other heirs, without a separate judgment recognising such property as escheat.”

F. Consideration by the domestic courts of disputes concerning escheat housing and bona fide purchasers

31. When deciding whether the City of Moscow could reclaim escheat housing from a bona fide purchaser, the courts have consistently found that, when a property owner died intestate and without heirs, the property should be considered escheat and title transferred to the City of Moscow as of the date of death of the property owner. Escheat property fraudulently acquired by a third party was considered to have been stolen from the City of Moscow. A statutory exception set out in Article 302 of the Russian Civil Code (see paragraph 25 above) allowed the City of Moscow to reclaim such property from bona fide purchasers. The following are examples of the courts’ practice on the matter.

1. Dismissal of the City’s claims against a bona fide purchaser

32. I. died without leaving any heirs. On an unspecified date, L. acquired title to a flat belonging to I. as I.’s heir.

33. On 24 December 2001 L. sold the flat to K.V. On 6 March 2002 K.V. sold the flat to B. On 9 July 2002 B. sold the flat to K.N., who moved in and resided in the flat with his daughter and her son, who was a minor.

34. On 20 November 2009 the Timiryazevskiy District Court of Moscow found L. guilty of fraud. The court established that L. had fraudulently inherited the flat from I. by forging the latter’s will.

35. On an unspecified date the Housing Department brought a civil action seeking, inter alia, recognition of the City’s title to the flat and the eviction of K.N. and his family.

36. On 2 August 2011 the Timiryazevskiy District Court of Moscow dismissed the claims against K.N. and his family. The court recognised K.N. as a bona fide purchaser of the flat and took into account that K.N. and his family had been living in the flat for eight years and had nowhere else to live. The court also noted that, in such circumstances, the family’s eviction would amount to a violation of human rights protected by the Constitution. Lastly, the court ruled that the Housing Department had missed the statutory deadline for its vindication claim against K.N.

37. On 24 October 2011 the Moscow City Court upheld the judgment of 2 August 2011 on appeal.

2. Recovery of an escheat flat by the City of Moscow from a bona fide purchaser

38. The flat at issue belonged to L., who died on 3 November 2003 without leaving any heirs. B. and G. forged a contract dated 10 October 2003, according to which L. had sold the flat to B.

39. On 4 October 2004 the City Registration Committee registered the said contract.

40. On 14 February 2008 the Savelovskiy District Court of Moscow found B. and G. guilty of fraud.

41. On an unspecified date the Housing Department brought a civil claim against B., seeking to recover the escheat flat from B.

42. On 18 August 2012 B. sold the flat to A. On 3 September 2012 the City Registration Committee registered the transaction and A.’s title to the flat.

43. It appears that, in the course of the civil proceedings concerning the recovery of the flat, the Housing Department brought an action against A. seeking not only the recovery of the flat but also A.’s eviction.

44. On 21 June 2013 the District Court dismissed the claims against A., recognising A. as a bona fide purchaser.

45. On 14 November 2013 the Moscow City Court quashed, in part, the judgment of 21 June 2013 on appeal. The court found, in particular, that the flat was the property of the City and could be reclaimed from A., albeit a bona fide purchaser. The court terminated A.’s title to the flat and ordered A.’s eviction.

46. On 29 January 2014 the City Court dismissed A.’s application for cassation review of the matter. The court held that the flat had been stolen and had left the City’s possession against its will. Accordingly it could be reclaimed from the bona fide purchaser, A.

G. Fundamental Principles of Notarial Legislation

47. Under Article 1 of the Fundamental Principles of Notarial Legislation 1993, amended in 2014, notaries are responsible for protecting the rights and lawful interests of individuals and legal entities in accordance with the Constitution of the Russian Federation and applicable legislation by means of carrying out notarial acts on behalf of the Russian Federation.

H. Regulation on Moscow City Committee for Registration of Real Estate Transactions (in force at the relevant time)

48. Under Article 8.4 of the Moscow Real Estate Committee Regulations, adopted by Decision of the Mayor of Moscow no. 341-RM of 8 April 1998, the responsibilities of the City Registration Committee include legal expert examination of documents submitted for registration of rights to real property in order to ensure their compliance with the legislation of the Russian Federation and the lawfulness of the transaction.

THE LAW

I. ALLEGED VIOLATION OF ARTICLE 1 OF PROTOCOL NO. 1

49. The applicant complained that she had been deprived of her flat in violation of Article 1 of Protocol No. 1 to the Convention, which reads as follows:

“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.

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.”

A. Admissibility

1. The parties’ submissions

50. The Government considered that the applicant had not made recourse to existing effective domestic remedies. It had been open to her to bring a civil action for damages against the person who had sold the flat to her with fraudulent intent. The Government cited actions brought by Pch. and P., who had successfully sued their counterparts for damages resulting from void transactions.

51. The applicant challenged the Government’s objection. Referring to the judgment delivered in the criminal proceedings against Yar. (who de facto had sold the flat to her), the applicant claimed that Yar. had been “just a straw man” and that the real perpetrators who had received the applicant’s money had not been identified. Accordingly, in her opinion, lodging an action for damages against Yar. would have been futile and offered no prospect of success. As regards the cases cited by the Government, she noted that in neither of them had the claimants sued the person who had committed fraud in respect of the flats. Pch. had brought an action against a large property company and P. had sued a previous bona fide owner of the flat.

2. The Court’s assessment

52. The Court notes that it has already examined the issue of exhaustion of effective domestic remedies in a case where the applicant had been deprived of her housing as a result of the revocation of her title to a flat by a final and enforceable judgment (see Gladysheva v. Russia, no. 7097/10, §§ 60-62 and 89, 6 December 2011). The Court concluded that, under Russian law, there was no further recourse against that judgment that might potentially lead to reinstatement of the applicant’s title to the flat. It further noted that the possibility of bringing an action for damages, in those circumstances, could not deprive the applicant of victim status for the purpose of complaints under Article 1 of Protocol No. 1 to the Convention. Nor could doing so be regarded as necessary for compliance with the rule of exhaustion of domestic remedies within the meaning of Article 35 § 1 of the Convention. Lastly, the Court considered that any damages that the applicant might have been able to recover against the seller of the flat might only be taken into account for the purposes of assessing the proportionality of the interference and, calculation of pecuniary damage if a violation of Article 1 of Protocol No. 1 to the Convention was found by the Court, and if just satisfaction was awarded under Article 41 of the Convention (ibid., § 62).

53. The Court considers that those findings hold true in the context of the present case. The Government have not put forward any fact or argument capable of persuading it to reach a different conclusion. Accordingly, it was not incumbent on the applicant to pursue the civil remedies referred to by the Government. The Government’s objection in this regard is, therefore, dismissed.

54. The Court notes that the complaint is not manifestly ill-founded within the meaning of Article 35 § 3 (a) of the Convention. It further notes that it is not inadmissible on any other grounds. It must therefore be declared admissible.

B. Merits

1. General principles

55. The general principles concerning protection of property are well established in the Court’s case-law and have been summarised as follows (see Gladysheva, cited above):

“64. The Court refers to its established case-law on the structure of Article 1 of Protocol No. 1 and the manner in which the three rules contained in that provision are to be applied (see, among many other authorities, J.A. Pye (Oxford) Ltd and J.A. Pye (Oxford) Land Ltd v. the United Kingdom [GC], no. 44302/02, § 52, ECHR 2007‑III; Bruncrona v. Finland, no. 41673/98, §§ 65-69, 16 November 2004; and Broniowski v. Poland [GC], no. 31443/96, § 134, ECHR 2004‑V).

65. It reiterates that in order to be compatible with the general rule of Article 1 of Protocol No. 1, an interference must comply with the principle of lawfulness and pursue a legitimate aim by means reasonably proportionate to the aim sought to be realised (see, for example, Beyeler v. Italy [GC], no. 33202/96, §§ 108-14, ECHR 2000‑I).

66. An interference with the peaceful enjoyment of possessions must therefore strike a “fair balance” between the demands of the public or general interest of the community and the requirements of the protection of the individual’s fundamental rights. The concern to achieve this balance is reflected in the structure of Article 1 as a whole, which is to be read in the light of the general principle enunciated in the first sentence. In particular, there must be a reasonable relationship of proportionality between the means employed and the aim sought to be realised by any measure depriving a person of his possessions or controlling their use. Compensation terms under the relevant legislation are material to the assessment of whether the contested measure respects the requisite fair balance, and, notably, whether it imposes a disproportionate burden on the applicant (see Former King of Greece and Others v. Greece [GC], no. 25701/94, § 89, ECHR 2000-XII).

67. In this connection, the taking of property without payment of an amount reasonably related to its value will normally constitute a disproportionate interference that cannot be justified under Article 1 of Protocol No. 1. This provision does not, however, guarantee a right to full compensation in all circumstances, since legitimate “public interest” objectives may call for reimbursement of less than the full market value (see, among other authorities, Papachelas v. Greece [GC], no. 31423/96, § 48, ECHR 1999-II).

68. Although Article 1 of Protocol No. 1 contains no explicit procedural requirements, the proceedings at issue must also afford the individual a reasonable opportunity to put his or her case to the responsible authorities for the purpose of effectively challenging the measures interfering with the rights guaranteed by this provision. In ascertaining whether this condition has been satisfied, a comprehensive view must be taken of the applicable procedures (see, among other authorities, Jokela v. Finland, no. 28856/95, § 45, ECHR 2002-IV). ”

2. Application of these principles in the present case

(a) Whether there was an interference

(i) The parties’ submissions

56. The applicant did not submit comments on this issue.

57. The Government did not challenge the fact that the flat bought by the applicant constituted her “possession”. They conceded that the reversion of the flat to the State had amounted to an interference with her rights set out in Article 1 of Protocol No. 1 to the Convention.

(ii) The Court’s assessment

58. The Court accepts that the flat constituted the applicant’s possession for the purposes of Article 1 of Protocol No. 1 to the Convention and that the revocation of her title to the flat amounted to an interference with her rights set out in Article 1 of Protocol No. 1.

59. As to the nature of the interference, the Court notes that because of the complexity of the factual and legal position in the present case, the interference does not fall into any of the categories covered by the second sentence of the first paragraph or by the second paragraph of Article 1 of Protocol No. 1 to the Convention (see Beyeler v. Italy [GC], no. 33202/96, § 98, ECHR 2000‑I). The Court therefore considers that it should examine the situation complained of in the light of the general rule set forth in the first sentence of the first paragraph of Article 1 of Protocol No. 1 (compare Gladysheva, cited above, § 71).

(b) Compliance with the principle of lawfulness

(i) The parties’ submissions

60. The applicant argued that there was no legal basis for the flat reverting to the City of Moscow, since the City had not accepted succession after R.’s death.

61. The Government considered that the interference with the applicants’ property rights had been “in accordance with the law”. R., the owner of the flat, had died without leaving any heirs. Pursuant to the applicable provisions of the Russian Civil Code, the flat was considered escheat property and title to it should have reverted to the State. However, Yar. had fraudulently acquired title to the flat. His actions had resulted in the loss of title to the flat by the City of Moscow against the latter’s will. Accordingly, even though the applicant had been a bona fide purchaser of the flat, the law allowed the City to recover the property from the applicant.

(ii) The Court’s assessment

62. The Court observes that Article 302 § 1 of the Russian Civil Code allows property to be reclaimed from a bona fide purchaser on condition that it left the possession of its owner, or holder, without that person having the intention to divest himself or herself of it. In particular, when the property was stolen from its owner.

63. The Court further observes that the domestic courts established that after the death of the owner, the flat had become escheat property. However, the reversion of the property to the City of Moscow had been prevented by Yar.’s fraudulent actions, which the courts considered as loss of the flat by the City against its will.

64. In this connection, the Court reiterates that it has limited power to review compliance with domestic law (see Beyeler, cited above, § 108, with further references), especially as nothing in the instant case leads it to conclude that the Russian authorities applied the legal provisions in question manifestly erroneously or so as to reach arbitrary conclusions (ibid.). The Court also observes that the applicant’s argument that the City did not accept succession after R.’s death and could not therefore claim title to the flat is contrary to the relevant provisions of the Russian Civil Code, which expressly provide that there is no need for the State to claim succession in similar circumstances. Escheat property automatically reverts to the State, as set forth in Articles 1151 and 1152 of the Russian Civil Code.

65. The Court observes that in certain respects the relevant legal provisions lack clarity, particularly in that they do not require the State to take any express action as regards the repossession of escheat property and leave open the time-limit for such an exercise. However, in the Court’s view, that factor alone cannot lead to the conclusion that the interference in question was unforeseeable or arbitrary and therefore incompatible with the principle of lawfulness.

66. The Court is, nonetheless, required to verify that the manner in which domestic law is interpreted and applied – even where the requirements have been complied with – does not entail consequences at variance with the Convention standards. From that stance, the element of uncertainty in the statute and the considerable latitude it affords the authorities are material considerations to be taken into account in determining whether the measure complained of struck a fair balance (see Beyeler, cited above, § 110).

(c) The aim of the interference

(i) The parties’ submissions

67. The applicant argued that she could not discern any pressing social need to transfer the flat to the City. She pointed out that, following R.’s death in 1996, the City authorities had neglected their duty for years and had done virtually nothing to assign R.’s flat to a person in need of social housing. Furthermore, after her eviction in 2010, the flat had remained empty for another two years. The Housing Department had not assigned it to another family until 2012.

68. The Government submitted that the recovery of the flat from the applicant had pursued the legitimate aim of protecting the interests of others, notably of persons in need of housing. The reversion of property to the State should not be viewed as carried out in the State’s interests only. The City of Moscow was responsible for providing affordable housing to people on low incomes. Accordingly, the City had reclaimed property in the interests of those people.

(ii) The Court’s assessment

69. As to the legitimate aim of the impugned measure, the Court takes note of the Government’s argument and reiterates that because of their direct knowledge of their society and its needs, the national authorities are in principle better placed than the international judge to appreciate what is “in the public interest”. Under the system of protection established by the Convention, it is thus for the national authorities to make the initial assessment as to the existence of a matter of public concern warranting measures of deprivation of property. Here, as in other fields to which the safeguards of the Convention extend, the national authorities accordingly enjoy a certain margin of appreciation (see Stolyarova v. Russia, no. 15711/13, § 46, 29 January 2015, with further references). With this in mind, the Court accepts that the revocation of the applicant’s title to the flat pursued the public interest, in that it catered for the needs of those on the waiting list for social housing.

(d) Whether there was a fair balance

(i) The parties’ submissions

70. Referring to the Court’s findings in the case of Gladysheva (see Gladysheva, cited above, §§ 77-83), the applicant claimed that the loss of her real property had amounted to a disproportionate interference with her rights set out in Article 1 of Protocol No. 1 to the Convention. The authorities had placed an excessive burden on her. They had failed to ensure a fair balance between their decision to reclaim the property from her, and her interests as the bone fide owner. She further argued that the State bore responsibility for the fraudulent transactions in respect of the real property she later purchased. It had been incumbent on the authorities to verify the compliance of those transactions with the applicable laws. However, they had failed to do so in a timely and diligent manner and had managed to reclaim the property from the bona fide owner only by flagrantly disregarding the latter’s interests. As regards the Government’s argument that it was still open to her to bring a civil action for damages against Yar., the applicant submitted that the criminal investigation into the situation had established that Yar. had acted in concert with others whom the investigators had failed to identify.

71. According to the Government, the interference with the applicant’s rights in the present case was proportionate to the legitimate aim pursued. The repossessed flat had been assigned to Sh. and her family, who had been on the housing waiting list for twenty-five years. They further conceded that the applicant had sustained a certain financial loss as a result of the State’s actions. However, her loss had been caused by the fraudulent acts of other individuals and the applicant could recover the damage by bringing a civil action against them. In the Government’s opinion, the loss of the real property in such circumstances did not amount to a disproportionate burden for the applicant. Unlike in the case of Gladysheva, where the fraud was discovered with four years’ delay, the authorities had reacted promptly to the fraud committed by Yar. The criminal proceedings instituted against him had resulted in his conviction only eleven months after the applicant had bought the flat. Lastly, the Government pointed out that, should the applicant consider herself in need of social housing, she could lodge a relevant application with the authorities, which she had not yet done.

(ii) The Court’s assessment

72. The Court observes that the applicant forfeited title to the flat after it was established, in the course of criminal proceedings, that Yar., who had sold the flat to the applicant, had acquired it on the basis of a forged will.

73. In this connection, the Court observes that there were at least two levels of safeguards in place to ensure that the flat passed to Yar. as R.’s heir in accordance with the domestic law. Firstly, it was the responsibility of a notary to make sure that the transfer of title to the flat to Yar. was carried out in accordance with the law (see paragraph 47 above) when considering and granting Yar.’s application to be recognised as R.’s heir. Secondly, the City Registration Committee (see paragraph 48 above) examined the documents submitted by Yar. for the registration of his title to the flat, in order to ensure their compliance with the relevant legislation and the lawfulness of the transaction, and issued a title deed to Yar.

74. The Court notes that the Government did not proffer any explanation as regards the failure on the part of the notary or the City Registration Committee to discover Yar.’s fraud.

75. The Court further observes that the Government’s submissions made no mention of when and how the fraud had been discovered or when the criminal investigation into Yar.’s actions had been opened. Given that Yar. was found guilty of fraud on 6 June 2001 and his conviction was preceded by an investigation into the matter and a trial, it appears that the criminal proceedings concerning the fraudulent acquisition of R.’s flat by Yar. practically overlapped with his recognition as R.’s heir and the registration of the transactions concerning the flat, which took place in June 2000. The fact that the authorities investigated Yar.’s actions and, at the same time, condoned his selling the flat to the applicant is a matter of concern for the Court.

76. Lastly, the Court notes that the first applicant was stripped of her title to the flat without compensation, and that she was not offered replacement housing by the State. As regards the Government’s argument that the applicant’s loss could be mitigated if she sued the seller of the flat for damages, the Court accepts that such opportunity was, indeed open to her. However, in the particular circumstances, of the case, such action would be devoid of any prospect of success given that (1) the person who had sold the flat to the applicant had been sentenced to a term of imprisonment and all his property had been confiscated by the State and (2) the authorities have not established to date the identity of all perpetrators involved in the fraudulent acquisition of the flat in 2001 (see paragraph 13 above).

77. Having regard to all the foregoing factors, the Court considers the state authorities have failed to ensure a proper expert review as regards the lawfulness of the real-property transactions. However, it was not for the first applicant to assume the risk of the title to the flat being revoked on account of the said omissions on the part of the authorities in procedures especially designed to prevent fraud in real-property transactions. The Court reiterates that mistakes or errors on the part of State authorities should serve to benefit the persons affected. In other words, the consequences of any mistake made by a State authority must be borne by the State and errors must not be remedied at the expense of the individual concerned (see Stolyarova v. Russia, no. 15711/13, § 49, 29 January 2015, with further references). The Court therefore concludes that the forfeiture of the title to the flat by the first applicant and its transfer to the City of Moscow, in the circumstances of the case, placed a disproportionate and excessive burden on her (compare, Gladysheva, cited, above, §§ 77-83). There has therefore been a violation of Article 1 of Protocol No. 1.

II. ALLEGED VIOLATION OF ARTICLE 8 OF THE CONVENTION

78. The applicant complained that her eviction had amounted to a violation of her right to respect for home. She relied on Article 8 of the Convention, which reads as follows:

“1. Everyone has the right to respect for his private and family life, his home and his correspondence.

2. There shall be no interference by a public authority with the exercise of this right except such as is in accordance with the law and is necessary in a democratic society in the interests of national security, public safety or the economic well-being of the country, for the prevention of disorder or crime, for the protection of health or morals, or for the protection of the rights and freedoms of others.”

79. The Government admitted that the national courts’ decisions to order the applicant’s eviction had constituted an inference with her rights set out in Article 8 of the Convention. They considered, however, that such interference had been lawful, had pursued the legitimate aim of protecting the rights of persons eligible to social housing and had been proportionate to that aim. They further pointed out that the applicant had resided in the flat for only eleven months. Such a brief period could not have resulted in the applicant establishing close ties with the flat as her home. Lastly, the Government argued that the applicant had a place to live.

80. The applicant maintained her complaint.

81. The Court notes that this complaint is linked to the one examined above and must therefore likewise be declared admissible. However, having regard to the findings relating to Article 1 of Protocol No. 1 to the Convention (see paragraphs 58-77 above), the Court considers that it is not necessary also to examine the same facts from the standpoint of Article 8 of the Convention (see, mutatis mutandis, Akhverdiyev v. Azerbaijan, no. 76254/11, § 101-05, 29 January 2015).

III. APPLICATION OF ARTICLE 41 OF THE CONVENTION

82. Article 41 of the Convention provides:

“If the Court finds that there has been a violation of the Convention or the Protocols thereto, and if the internal law of the High Contracting Party concerned allows only partial reparation to be made, the Court shall, if necessary, afford just satisfaction to the injured party.”

A. Damage

83. The applicant claimed 10,426,983 roubles (RUB) in respect of pecuniary damage and 100,000 euros (EUR) in respect of non-pecuniary damage.

84. The Government contested those sums as excessive, unsubstantiated and unreasonable.

85. The Court takes into account that in the present case it has found a violation of the applicant’s rights guaranteed by Article 1 of Protocol No. 1. It considers that there is a clear link between the violations found and the damage caused to the applicant.

86. The Court reiterates that, normally, the priority under Article 41 of the Convention is restitutio in integrum, as the respondent State is expected to make all feasible reparation for the consequences of the violation in such a manner as to restore as far as possible the situation existing before the breach (see, among other authorities, Piersack v. Belgium (Article 50), 26 October 1984, § 12, Series A no. 85; Tchitchinadze v. Georgia, no. 18156/05, § 69, 27 May 2010; Fener Rum Patrikliği (Ecumenical Patriarchy) v. Turkey (just satisfaction), no. 14340/05, § 35, 15 June 2010, § 198; and Stoycheva v. Bulgaria, no. 43590/04, 19 July 2011). Consequently, having due regard to its findings in the instant case and to the fact that the applicant did not receive any compensation for loss of title to the flat in the domestic proceedings, the Court considers that the most appropriate form of redress would be to restore the applicant’s title to the flat and to reverse the order for her eviction. Thus, the applicant would be put as far as possible in a situation equivalent to the one in which she would have been had there not been a breach of Article 1 of Protocol No. 1 (compare, Gladysheva, cited above, § 106). In the alternative, if the Government no longer own the flat, or if it has been otherwise alienated, they should ensure that the applicant receives an equivalent flat.

87. In addition, the Court has no doubt that the applicant has suffered distress and frustration on account of the deprivation of her possessions and the eviction from her home. Making its assessment on an equitable basis, the Court awards her EUR 5,000 in respect of non-pecuniary damage.

B. Costs and expenses

88. The applicant also claimed costs and expenses incurred before the domestic courts and before the Court, which are summarised in the table below:

Court fee

Issuance of authority forms

Legal fee

Expert appraisal of the flat

Postal /

Translation costs

Domestic proceedings

Proceedings before the Court

RUB

9,233

RUB 1,100

USD 30,000

EUR 10,000

RUB 3,600

RUB 7,302.43 RUB 10,120

89. The Government asked the Court to reject the applicant’s claims for costs and expenses incurred in connection with the domestic proceedings (legal and court fees), as they considered them irrelevant to the consideration of her complaints before the Court. They pointed out that some of the expenses claimed by the applicant had not been supported by appropriate receipts.

90. According to the Court’s case-law, an applicant is entitled to the reimbursement of costs and expenses only in so far as it has been shown that these have been actually and necessarily incurred and are reasonable as to quantum. Regard being had to the documents in the Court’s possession and the above criteria, the Court considers it reasonable to award the applicant EUR 3,200 in respect of all her claims for costs and expenses.

C. Default interest

91. The Court considers it appropriate that the default interest rate should be based on the marginal lending rate of the European Central Bank, to which should be added three percentage points.

FOR THESE REASONS, THE COURT

1. Declares, unanimously, the application admissible;

2. Holds, by six votes to one, that there has been a violation of Article 1 of Protocol No. 1;

3. Holds, unanimously, that there is no need to examine a complaint under Article 8 of the Convention;

4. Holds, by six votes to one,

(a) that the respondent State shall ensure, by appropriate means, within three months from the date on which the judgment becomes final in accordance with Article 44 § 2 of the Convention, full restitution of the applicant’s title to the flat and the annulment of her eviction order. In the alternative, if the flat is no longer the State’s property, or if it has been otherwise alienated, the respondent State shall ensure that the applicant receives an equivalent flat;

(b) that the respondent State is to pay the applicant, within the same three months from the date on which the judgment becomes final in accordance with Article 44 § 2 of the Convention, the following amounts, to be converted into the currency of the respondent State at the date of settlement:

(i) EUR 5,000 (five thousand euros), plus any tax that may be chargeable, to be converted into Russian roubles at the rate applicable at the date of settlement, in respect of non-pecuniary damage;

(ii) EUR 3,200 (three thousand two hundred euros), plus any tax that may be chargeable to the applicant, in respect of costs and expenses;

(c) that from the expiry of the above-mentioned three months until settlement, simple interest shall be payable on the above amounts at a rate equal to the marginal lending rate of the European Central Bank during the default period plus three percentage points;

5. Dismisses, unanimously, the remainder of the applicant’s claim for just satisfaction.

Done in English, and notified in writing on 17 November 2016, pursuant to Rule 77 §§ 2 and 3 of the Rules of Court.

Abel CamposAndrás Sajó
RegistrarPresident

In accordance with Article 45 § 2 of the Convention and Rule 74 § 2 of the Rules of Court, the separate opinion of Judge Sajó is annexed to this judgment.

A.S.
A.C.

DISSENTING OPINION OF JUDGE SAJÓ

To my regret I have to dissent in this case for the reasons set out in Ponyanyeva and others v. Russia (no. 63508/11). Here again the information regarding the fraud was accessible only after the purchase by applicant. As to the balance among the various interests in the case it is noteworthy that the Court orders full restitution of the applicant’s title, even though a person entitled to social housing has been living there since 2010. The Court does not specify which authorities are to be held responsible, but refers only to “so many authorities having granted clearance to the title to the flat” (see paragraph 53). In fact, the authority issuing passports, the Housing Department and the Registration Service were acting in an official capacity. At one point the notary is also involved (issuing a certificate of inheritance; see paragraph 9). This judgment (though not the “sister” judgments) refers, in the Relevant Domestic Law section, to the Fundamental Principles of Notarial Legislation 1993, which point out that the notary conducts notarial acts on behalf of the Russian Federation (see paragraph 47). The Court considers it sufficient that the notary and the State organisations were involved in the various decisions leading to the situation whereby the embezzled State property was sold to a bona fide third party. We do not know whether any professional mistake was committed by the notary, a private professional. I am concerned that this could lead to the extension of notarial liability all over Europe and also to the extension of State liability under international law for the acts of private professionals.

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