FIFTH SECTION
DECISION
Applications nos. 49646/10 and 3365/11
Hans LESSING against Germany
and Hans REICHELT against Germany
The European Court of Human Rights (Fifth Section), sitting on 16 October 2012 as a Committee composed of:
Boštjan M. Zupančič, President,
Ann Power-Forde,
Angelika Nußberger, judges,
and Stephen Phillips, Deputy Section Registrar,
Having regard to the above applications lodged on 24 August 2010 and on 24 December 2010,
Having deliberated, decides as follows:
THE FACTS
The two applicants are German nationals and represented before the Court by Mr K. H. Christoph and Ms I. Christoph, lawyers practising in Berlin.
A. The circumstances of the case
1. The facts of the case, as submitted by the applicants, may be summarised as follows.
1. The applicant Lessing
(a) Professional career
2. The applicant was born in 1934. He started his professional career in the German Democratic Republic (GDR) in 1955 as an engineer. From 1 August 1970 until 31 July 1983 he was Deputy Minister of the Ministry of Light Industry (Minsterium der Leichtindustrie) and of the Ministry for District-directed Industry (Ministerium für bezirksgeleitete Industrie). From 1 August 1983 until 30 June 1990 he was the intendant of the Berlin Concert House. He became eligible for a retirement pension on 1 May 1999.
3. From 1 November 1968 the applicant was affiliated to the optional pension system of the technical elite (freiwillige Zusatzversicherung der technischen Intelligenz) and from 1 March 1981 to the voluntary supplementary pension scheme of the state’s highest public servants (freiwillige zusätzliche Altersversorgung für hauptamtliche Mitarbeiter des Staatsapparats). He now receives a monthly retirement pension of about 1,424.46 euros (EUR).
(b) Proceedings at issue
4. On 22 July 1999 the applicant challenged the calculation of his pension, in particular the application of section 6 § 2 no. 4 of the German Pension Transfer Law, before the Nordhausen Social Court.
5. On 31 May 2002 the Social Court dismissed his claim as it had no constitutional concern about the constitutionality of section 6 § 2 no. 4 of the German Pension Transfer Law.
6. On 25 February 2008 the Thuringia State Social Court partly stayed the proceedings insofar as the constitutionality of section 6 § 2 of the German Pension Transfer Law was in question, and referred the question for decision to the Federal Constitutional Court as it regarded the provision unconstitutional. The question was relevant for the case as, if the applicant’s pension was calculated without applying the said provision, his pension would increase by EUR 160. In all other regards the Thuringia State Social Court dismissed the appeal.
7. On 6 July 2010 the Federal Constitutional Court decided in joint proceedings on the merits of the referrals concerning both applicants. It held that section 6 § 2 of the German Pension Transfer Law complied with the Basic Law. Recalling its landmark decisions of 28 April 1999 on the Pension Transfer Law – see below under Relevant domestic law – the Constitutional Court reiterated that the pension claims of GDR citizens arising from additional or supplementary pensions schemes fell within the ambit of the constitutional protection of property. However, the legislator enjoyed an exceptionally large margin of appreciation in the field of re‑organisation of pension claims after German reunification. In particular, the legislator was allowed to modify pension claims to adjust former unjustified or excessive benefits. The Federal Constitutional Court held that the approach of the legislator to follow the distinctions the first democratic GDR legislator had made in June 1990 by capping the maximum pensions payable to high state officials was reasonable. It emphasised that the pension claims of the applicants enjoyed the protection of property only in this restricted sense. It further argued that section 6 § 2 no. 4 of the law in question included only very exposed, highly political functions in the GDR. The legislative assumption that persons in these functions had benefitted from a system of unjustified privileges was sound and in parts even obvious. The Federal Constitutional Court considered that the pension calculation by replacing the actual earnings of the applicants with the average GDR earning was also proportionate. This method of calculation was applied only for the months the applicants had held office as ministers or deputy ministers. The court noted that the pensions of the applicants nevertheless exceeded significantly the average GDR pension and were well above the level of recipients of social aid.
2. The applicant Reichelt
(a) Professional career
8. The applicant was born in 1925. From 1951 the applicant was a member of the German Democratic Farmers’ Party’s (Demokratische Bauernpartei Deutschlands) executive committee. From 1953 until 1963 he served as the Minister of Agriculture in the GDR, from 1963 until July 1967 he was a Deputy Minister and a member of the Council of Ministers, from 1967 until 1972 he held office as a State Secretary in the Ministry of Agriculture and from March 1972 until January 1990 he was Minister of Environmental Protection and Water Economy. On 1 March 1990 the applicant retired.
9. From 1971 until 1990 the applicant was affiliated to the voluntarily supplementary pension scheme of state’s highest public servants. From July 1990 until October 1990 he received a reduced pension under the then effective GDR provisions. He now receives a monthly pension of around EUR 1,179.
(b) Proceedings at issue
10. On 11 December 1997 the applicant applied for judicial review at the Berlin Social Court, objecting to the calculation of his pension and claiming a higher pension. He argued that his earnings as a minister had not been excessive and that the pension transfer scheme was arbitrary.
11. The Berlin Social Court stayed the proceedings several times in order to wait for the outcome of various proceedings before the Federal Constitutional Court in 1999 and in 2004 and later for the enactment of the subsequent legislative amendments which influenced the second applicant’s pension. In the meantime, the applicant’s pension was recalculated in 2000, in 2002 and 2005 which lead to a payment of arrears of altogether about EUR 4,500.
12. On 9 June 2006 the Berlin Social Court again stayed the proceedings and referred the question of the constitutionality of the amended section 6 § 2 of the German Pension Transfer Law to the Federal Constitutional Court. The court had established that the applicant’s monthly pension would increase by EUR 650 if his pension was calculated on his real annual income and not on the average GDR income according to section 6 § 2 of the aforementioned law. The court was convinced that the provision was unconstitutional after it had heard witnesses on the legislative procedures how the legislator had established which occupations benefited from privileges in the GDR. It came to the conclusion that the method lacked rationality if the standards of the 1999 Federal Constitutional judgment were applied. According to the court the occupations which were subject to a pension reduction had been arbitrarily chosen.
13. On 6 July 2010 the Federal Constitutional Court held the provision compatible with the Basic Law (see above under 1 (b)).
(c) Subsequent developments
14. On 7 December 2011 the Government informed the Court that in response to the pilot judgment Rumpf v. Germany (no. 46344/06, 2 September 2010) an Act against Protracted Court Proceedings and Criminal Investigations (Gesetz über den Rechtsschutz bei überlangen Gerichtsverfahren und strafrechtlichen Ermittlungsverfahren) had been published in the Federal Law Gazette and had entered into force on 3 December 2011.
15. In December 2011 the Court informed the second applicant in the present case of the enactment of the new domestic remedy and drew his attention to the interim provision of that Act. Referring to the case Brusco v. Italy ((dec.), no. 69789/01, ECHR 2001‑IX) the Court invited the second applicant to inform the Court whether he intended to make use of the new remedy within the time-limit set by the transitional provision of that Act.
16. The second applicant informed the Court in response that he did not intend to make use of the new remedy.
B. Relevant domestic law and practice
17. The pension system of the GDR comprised the general pension scheme, which was composed of the compulsory social insurance fund (Sozialpflichtversicherung) and the optional supplementary pension fund (freiwillige Zusatzrentenversicherung), and a host of additional pension schemes (Zusatzversorgungssysteme).
18. Article 20 § 2 of the State Treaty of 18 May 1990 between the Federal Republic of Germany (FRG) and the GDR on the Creation of Monetary, Economic and Social Union (Staatsvertrag über die Schaffung einer Währungs-, Wirtschafts- und Sozialunion zwischen der Bundesrepublik Deutschland und der Deutschen Demokratischen Republik) is worded as follows:
“... Acquired rights and future rights shall be transferred to the [FRG] pension scheme, but the benefits payable under the special provisions shall be re-examined with a view to eliminating unjustified benefits and reducing excessive benefits ...”
19. In the second of four judgments on the constitutionality of the transfer scheme of GDR pensions on 28 April 1999 the Federal Constitutional Court – 1 BvL 22/95 and 1 BvL 34/95 held section 6 §§ 2 and 3 of the German Pension Transfer Law (Gesetz zur Überführung der Ansprüche und Anwartschaften aus Zusatz- und Sonderversorgungs-systemen des Beitrittsgebiets) unconstitutional. It found the aim of the legislator to limit the accrued pension of those who had enjoyed unjustified and excessive benefits in principle legitimate and reasonable. However, the regulations in question were arbitrary as certain groups of persons were disadvantaged solely because they were affiliated to a certain type of additional pension scheme and their salary exceeded a certain amount. Although both criteria were in theory suitable for describing a benefit as “unjustified”, they were not sufficient. The legislator did not in concreto rely on a sufficient factual basis for the classification. The legislator had to investigate in which professional areas the high‑ranking officials had received unjustified benefits.
20. The subsequently amended version of section 6 of the German Pension Transfer Law was again declared unconstitutional as discriminatory by decision of the Federal Constitutional Court on 23 June 2004. The legislator was given until 30 June 2005 to amend the provision further, otherwise it would become void.
21. On 21 June 2005 the German legislator amended the German Pension Transfer Law. The amended section 6 § 2 entered into force retroactively as from 1 June 1993 and is – insofar as relevant – worded as follows:
(version in German)
(2) Für Zeiten der Zugehörigkeit zu einem Versorgungssystem nach Anlage 1 oder Anlage 2 Nr. 1 bis 3 bis zum 17. März 1990, in denen eine Beschäftigung oder Tätigkeit ausgeübt wurde als
(...)
4. Minister, stellvertretender Minister oder stimmberechtigtes Mitglied von Staats‑oder Ministerrat oder als ihre jeweiligen Stellvertreter,
(...)
ist den Pflichtbeitragszeiten als Verdienst höchstens der jeweilige Betrag der Anlage 5 zugrunde zu legen.
(version in English)
(2) For periods of affiliation to a pension scheme which is listed in Appendix 1 or Appendix 2 no. 1 to 3 until 17 March 1990, in which an occupation or office was held as
(...)
4. minister, deputy minister, member of Council of State or Council of Ministers with voting rights or their deputies,
(...)
the maximum earnings falling in the compulsory contribution period may not exceed those listed in Appendix 5.
COMPLAINTS
22. The applicants complained before the Court of an infringement of their right to peaceful enjoyment of their possessions and of discriminatory legislation on pension calculation, contrary to Article 14 of the Convention taken in conjunction with Article 1 of Protocol No. 1. They also invoked Article 7 of the Convention as they considered the pension reduction to have a retroactive punitive effect. They further invoked Article 6 §§ 1 and 2 of the Convention for the alleged unfairness of the proceedings and a breach of the presumption of innocence as well as a violation of Article 1 Protocol No. 12. In addition, the second applicant complained about the length of proceedings of 12 years for two levels of jurisdiction.
THE LAW
A. Complaint under Article 1 of Protocol no. 1 read in conjunction with Article 14 of the Convention
23. The applicants complained of an infringement of their right to peaceful enjoyment of their possessions and of a discriminatory policy, contrary to Article 14 of the Convention taken in conjunction with Article 1 of Protocol No. 1.
Article 14 of the Convention provides:
“The enjoyment of the rights and freedoms set forth in [the] Convention shall be secured without discrimination on any ground such as sex, race, colour, language, religion, political or other opinion, national or social origin, association with a national minority, property, birth or other status.”
Article 1 of Protocol No. 1 provides:
“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.”
24. The applicants submitted that they were the victims of discrimination as the calculation of their pension rights accrued during the time they held offices as minster or deputy minister was based on the average GDR salary and not on their de facto salaries according to section 6 § 2 no. 4 of the German Pension Transfer Law. In this way they and other holders of high political functions of the GDR were arbitrarily singled out. The German legislator did not follow a study-based method. They argued in particular that their remuneration as (deputy) ministers was not excessive and corresponded to their abilities and merits. They emphasised that even the Federal Constitutional Court had to acknowledge that the motives of the legislator had been partially erroneous insofar as deputy ministers had no legal or factual right to give orders to the Ministry of State Security. The amount of their pension had, accordingly, dropped to an abnormally low level compared to the pension rights they had accrued in the GDR.
25. According to the Court’s established case-law, the principles which apply generally in cases under Article 1 of Protocol No. 1 are equally relevant when it comes to welfare benefits. In particular, this Article does not create a right to acquire property. It places no restriction on the Contracting State’s freedom to decide whether or not to have in place any form of social security scheme, or to choose the type or amount of benefits to provide under any such scheme. If, however, a Contracting State has in force legislation providing for the payment as of right of a welfare benefit – whether conditional or not on the prior payment of contributions – that legislation must be regarded as generating a proprietary interest falling within the ambit of Article 1 of Protocol No. 1 for persons satisfying its requirements (see Stummer v. Austria [GC], no. 37452/02, § 82, ECHR 2011 and Stec and Others v. the United Kingdom (dec.) [GC], nos. 65731/01 and 65900/01, § 54, ECHR 2005‑X).
26. The Court observes that the Federal Constitutional Court on several occasions treated the GDR pension claims as modified by the State Treaty and the Reunification Treaty in principle as a property interest which falls within the ambit of the protection of property provided by the Basic Law. The Court sees no reason why it should qualify the aforesaid rights differently.
27. Although Article 1 of Protocol No. 1 does not include the right to receive a social security payment of any kind, if a State does decide to create a benefit scheme, it must do so in a manner which is compatible with Article 14 (see Stummer, cited above, § 83 and Andrejeva v. Latvia [GC], no. 55707/00, § 79, ECHR 2009). The Court points out that a difference of treatment is discriminatory for the purposes of Article 14 if it “has no objective and reasonable justification”, that is, if it does not pursue a “legitimate aim” or if there is not a “reasonable relationship of proportionality between the means employed and the aim sought to be realised”. Moreover, the Contracting States enjoy a margin of appreciation in assessing whether and to what extent differences in otherwise similar situations justify a different treatment (see Stummer, cited above, § 88).
28. The Court notes that due to section 6 § 2 no. 4 of the German Pension Transfer Law which applies only to a limited circle of high-profile positions the applicants’ pensions are calculated in a way that results in a significantly lower monthly pension. However, the Court does not find this treatment discriminatory in the sense of Article 14 of the Convention for the following reasons:
29. Firstly, section 6 § 2 of the German Pension Transfer Law serves the legitimate aim of “eliminating unjustified benefits and reducing excessive benefits” as Article 20 § 2 State Treaty provides (see Schwengel v. Germany (dec.), no. 52442/99, 2 March 2000 and Goretzki v. Germany (partial dec.), no. 52447/99, 24 January 2002. Both cases concern a similar pension scheme of high-ranking official of the former Ministry of State Security (STASI) according to section 7 of the German Pension Transfer Law).
30. Secondly, the Court does not find the calculation method disproportionate. The Court reiterates that the Contracting States enjoy a margin of appreciation in assessing “different” or “similar” situations, in particular in the rather unique context of German reunification (see Maltzan and Others v. Germany (dec.) [GC], nos. 71916/01, 71917/01 and 10260/02, § 74 et seq., ECHR 2005‑V). The Court notes in this context that the reasons the Federal Constitutional Court gave in its judgment of 6 July 2010 why the distinction cannot be considered arbitrary and disproportionate are convincing. It goes without saying that positions like those the applicants held were prominent and privileged. Thus, the last GDR legislator capped in June 1990 the pension rights of retired ministers and deputy ministers of the GDR as they were qualified as excessive. The applicants did not submit persuasive arguments to refute the Federal Constitutions Court’s argumentation.
31. The Court notes that the application of section 6 § 2 of the German Pension Transfer Law does not leave the applicants destitute. The Federal Constitutional Court found that current pensions of the applicants exceeded the level of social benefits and was still above the average pension a former GDR citizen received.
32. Consequently, the modified pension calculation of certain persons who held exceptionally high and relevant positions within the political elite of the GDR was not contrary to Article 14 of the Convention taken in conjunction with Article 1 of Protocol No. 1.
33. It follows that this complaint is manifestly ill-founded within the meaning of Article 35 § 3 and 3 (a) of the Convention.
B. Complaint under Article 7
34. The applicants complained of an alleged violation of Article 7 of the Convention. They compare the method of calculating pension rights of former GDR ministers and their deputies to a penalty in the sense of Article 7 of the Convention.
35. Article 7 of the Convention reads as follows:
"1. No one shall be held guilty of any criminal offence on account of any act or omission which did not constitute a criminal offence under national or international law at the time when it was committed. Nor shall a heavier penalty be imposed than the one that was applicable at the time the criminal offence was committed.
2. This Article shall not prejudice the trial and punishment of any person for any act or omission which, at the time when it was committed, was criminal according to the general principles of law recognised by civilised nations."
36. The Court recalls that the concept of “penalty” in Article 7 of the Convention is an autonomous concept: it is for the Court to determine whether any particular measure is a “penalty”. The wording of Article 7 indicates that the starting-point in any assessment of the existence of a “penalty” is whether the measure in question is imposed following conviction for a "criminal offence". Other factors that may be taken into account as relevant in this connection are the nature and purpose of the measure in question; its characterisation under national law; the procedures involved in the making and implementation of the measure; and its severity (see Welch v. the United Kingdom, 9 February 1995, § 26 et seq., Series A no. 307‑A and Adamson v United Kingdom (dec.), no. 42293/98, 26 January 1999).
37. The disadvantageous calculation of pension rights does not fulfil any requirement of a “penalty” in the above sense. The pension is calculated independently of a criminal conviction and in an administrative manner imposed by law without any additional procedure.
38. It follows that this complaint is manifestly ill-founded within the meaning of Article 35 § 3 and 3 (a) of the Convention.
C. Complaint of the second applicant under Article 6 § 1 concerning the length of proceedings
39. The second applicant complained about the length of the proceedings under Article 6 § 1 of the Convention. This provision provides as follows:
“In the determination of /his civil rights and obligations or of/ ... any criminal charge against him everyone is entitled to a ... hearing within a reasonable time by [a] ... tribunal...”
40. The Court held in Taron v. Germany ((dec.), no. 53126/07, §§ 40 et seq., 29 May 2012) – a case that involved an applicant who like the second applicant did not intend to make use of the new domestic remedy – that due to the principle of subsidiarity of an international jurisdiction even applicants who had lodged their application with this Court before the domestic remedy entered into force have to avail themselves to that new remedy.
41. In the present case the Court sees no reasons to come to a different conclusion. It follows that this complaint must be rejected under Article 35 §§ 1 and 4 of the Convention for non-exhaustion of domestic remedies.
D. The remainder of the applicants’ complaints
42. Referring to other articles of the Convention and its Protocols, the applicants complained of further aspects related to the above proceedings.
43. Having regard to all the materials in its possession, and insofar as these complaints fall within its competence, the Court finds that there is no appearance of a violation of the rights and freedoms set out in these provisions in that respect. It follows that this part of the applications must be rejected as being manifestly ill-founded, pursuant to Article 35 §§ 1, 3 (a) and 4 of the Convention.
For these reasons, the Court unanimously
Decides to join the applications;
Declares the applications inadmissible.
Stephen PhillipsBoštjan M. Zupančič
Deputy RegistrarPresident
Full & Egal Universal Law Academy