Communicated on 19 October 2020
Published on 9 November 2020
FIRST SECTION
Applications nos. 39942/18 and 41347/18
Helena SAK against Poland
and Kazimierz GIEBUŁTOWICZ against Poland
both lodged on 14 August 2018
STATEMENT OF FACTS
1. A list of the applicants is set out in the appendix.The circumstances of the case
2. The facts of the case, as submitted by the applicants, may be summarised as follows.Background
3. The applicants are siblings whose father owned property in the so‑called territories beyond the Bug River. The property in question comprised forty-six hectares of land, a brick one-storey house and two farm buildings.
4. As a result of boundary changes following the Second World War, those territories no longer formed part of Poland and the applicants’ father was “repatriated” elsewhere. After the war the Polish State undertook to compensate persons such as the applicants’ father, in respect of property which they had been forced to abandon. Such persons were entitled to have the value of the abandoned property deducted from the price of immovable property purchased from the State (Broniowski v. Poland [GC], no. 31443/96, § 10-12, ECHR 2004‑V).
5. In 1989 the value of the property in question was estimated, according to an official valuation, to be the current equivalent[1] of 2,234.40 Polish zlotys (PLN, today’s equivalent of 558.60 euros, EUR).
6. In 1990 each applicant inherited one third of their late father’s Bug River compensation entitlement.
7. For the purposes of compensation, on 10 August 1998 the Katowice District Office (Urząd Rejonowy) issued a certificate stating that the value of the abandoned property was fixed at 8,095,908 Polish zlotys (PLN, equivalent of EUR 2,023,977), that is 17 PLN per square metre. The certificate in question was based on the valuation made in 1997 by a professional property appraiser (biegły).
8. The applicants then purchased – jointly with their brother, who is not an applicant in the present case – six properties from the State. They paid for each of them by signing off the necessary amounts against the value of the abandoned property as certified in 1998. The total amount of these transactions was PLN 3,130,208 (the equivalent of EUR 782,552).
9. In addition to the above-mentioned transactions, on 4 March 2002 the applicants and their brother purchased a recreation centre from the State Forests, a governmental organisation that manages state-owned Polish forests on behalf of the State Treasury. The property in question comprised, among others, 1,165 hectares of land. The property was sold for PLN 1,400,000 (the equivalent of EUR 350,000) and that amount was signed off against the applicants’ remaining Bug River compensation entitlement.
10. On 19 March 2002 the three siblings sold this property for PLN 450,000 (the equivalent of EUR 87,500).
11. In 2004 an audit that was carried out at the local branch of the State Forests by the Supreme Audit Office (Najwyższa Izba Kontroli) revealed that the value of the Bug River property belonging to the applicants’ father, as certified in 1998, had been disproportionately high in comparison to the market value of similar properties. The Supreme Audit Office thus established that the real value of that property could in fact be a maximum of PLN 287,320 (the equivalent of EUR 71,830).
12. In 2005 the professional property appraiser who had prepared the 1997 valuation of the Bug River property belonging to the applicants’ father was criminally convicted for perjury. His line of defence was that he had mistakenly omitted to place a dot in between the numbers, writing 17 instead of 1.7 PLN per square metre (see paragraph 7 above).
As established by the domestic court in the course of the civil proceedings described below, according to the valuation drawn up in 2005, the property in question was in fact worth PLN 364,000 (approximately EUR 91,000).
13. On 24 February 2009 the Governor of Śląski Region (Wojewoda) declared the certificate of 10 August 1998 null and void because the value of the property in question had been incorrectly valuated. On 25 August 2009 the Minister for State Treasury (Minister Skarbu Państwa) quashed that decision, holding that although the impugned certificate had been issued in flagrant violation of the law, it could not be declared null and void because it had produced irreversible legal consequences.Action for payment against the applicants
14. On 28 February 2012 the State Treasury brought a civil action against the applicants, seeking payment for the sum of PLN 1,360,000 (approximately EUR 340,000) under the head of the return of unjust gain at the expense of the State Treasury.
15. This action was based on section 1(1) of the Act of 21 June 1990 on the return of benefits unjustly made at the detriment of the State Treasury (Ustawa o zwrocie korzyści uzyskanych niesłusznie kosztem Skarbu Państwa lub innych państwowych osób prawnych, “the 1990 Act”, see paragraphs 36 and 37 below).
16. On 29 July 2013 the Katowice Regional Court (Sąd Okręgowy) dismissed the action.
17. On 23 January 2014 the Katowice Court of Appeal (Sąd Apelacyjny) dismissed the appeal lodged by the State Treasury. On 23 October 2015 the Supreme Court (Sąd Najwyższy), upon the State Treasury’s cassation appeal, quashed the latter judgment and remitted the case to the Katowice Court of Appeal.
18. On 16 February 2017 the Katowice Court of Appeal found partly in the plaintiff’s favour and ordered each applicant to return PLN 115,357 (approximately EUR 28,840), plus interest. Each applicant was also charged various court fees and costs, adding up to the total of PLN 16,233 (approximately EUR 4,058).
19. On 14 February 2018 the Supreme Court dismissed the applicants’ cassation appeal.
20. The domestic court estimated the actual value of the Bug River property belonging to the applicants’ father based on the three valuations obtained in 1989, 1994 and 1995 (see paragraphs 5, 11 and 12 above). These official valuations had not been contested by the applicants before the civil court. The applicants had also not provided any proof of a different valuation. The court thus observed that at best the property in question had been worth PLN 364,000 (approximately EUR 91,000 paragraph 12 above).
21. The court then established that the applicants had sold the estates that they had purchased prior to 4 March 2002 (see paragraph 8 above) for the total amount of PLN 375,702 (approximately EUR 94,000). The outstanding amount of that disproportionately overvalued compensation equivalent had thus been unjustly created.
22. Given these elements, the Supreme Court concluded that the applicants had used up the compensation equivalent prior to the impugned transaction with the State Forests (see paragraph 9 above).
23. Consequently, paying for that transaction with the outstanding amount of the compensation equivalent had generated an “unjust gain” for the applicants and a loss for the State in so far as the property had been paid for with “defective Bug River money”. On that basis the 1990 Act was applicable to the case.
24. The court held that issuing an erroneous compensation equivalent could not deprive the State Treasury of the right to claim the return of an unjust gain. The obligation to return such a gain, resting on the other party to the transaction, was not contrary to the principle of co-existence in society.
25. The ten-fold overvaluation of the property in question, as compared with similar properties in the region, should have raised doubts with the applicants. The applicants’ brother explained before the civil court that he had thought the amount in question to be accurate because the property was very large. He also added that one did not question what one was being offered.
26. The Supreme Court observed that the applicants had acted in good faith, trusting that the administrative authorities had issued a correct compensation certificate (see paragraph 7 above). The fact that, in the course of the subsequent transactions with the State, the impugned valuation had not been reviewed or revoked only reinforced the certificate’s legitimacy. The court accepted that the same conviction about the validity of the impugned certificate had accompanied the applicants when they had sold the property in question.
27. The court therefore concluded that the applicants could not be ordered to refund the State a higher amount than the benefit they had derived.
28. The court calculated that, in view of various notarial and tax expenses bore by the applicants, the gain which they had derived from the transaction was PLN 346,072 (approximately EUR 86,518). The domestic court ordered each applicant to return one third of the above amount (see paragraph 18 above).Constitutional complaint
29. On 12 April 2018 the Constitutional Court (Trybunał Konstytucyjny) refused to examine the applicants’ constitutional complaint on the grounds that the applicants’ lawyer had incorrectly formulated the complaint. On 18 June 2018 the Constitutional Court dismissed an interlocutory appeal against the latter decision.
30. In their constitutional complaint, the applicants had argued that section 1(1) of the 1990 Act was contrary to Article 2 of the Constitution (rule of law and principles of social justice).Relevant domestic law and practice
31. The Constitution of the Republic of Poland of 2 April 1997 reads, in so far as relevant, as follows:
“...
Article 2
The Republic of Poland shall be a democratic state ruled by law and implementing the principles of social justice.
...
Article 32
All persons shall be equal before the law. All persons shall have the right to equal treatment by public authorities. ...”
32. Polish civil law offered at the relevant time, and still does, various remedies for claiming the return of benefits unjustly made by legal or natural persons to the detriment of the State Treasury. Actions can thus be brought for: (i) unjust enrichment (bezpodstawne wzbogacenie) under Article 405 of the Civil Code; (ii) vices of consent (wadliwość oświadczenia woli) under Articles 84-88 of the Civil Code; or (iii) annulment of a legal act contrary to the principles of co-existence with others (nieważność czynności prawnej sprzecznej z zasadami współżycia społecznego) under Article 58 § 2 of the Civil Code.
33. In addition to the above-mentioned provisions of the Civil Code, the Act of 21 June 1990 on the return of benefits unjustly made at the detriment of the State Treasury (Ustawa o zwrocie korzyści uzyskanych niesłusznie kosztem Skarbu Państwa lub innych państwowych osób prawnych, “the 1990 Act”) regulates situations where the State Treasury has suffered loss on account of an “unjust gain” (niesłuszna korzyść) to a legal or natural person which directly results from a legal act or an administrative decision transferring a title to them from a State’s property.
34. Under section 1(1) of the 1990 Act, a court shall order redress or dissolve the contract, deciding on the settlement between the parties.
35. The 1990 Act has been in force, with amendments, since 23 July 1990.
36. On 8 July 2008 the Constitutional Court ruled on the legal question which had arisen in the case concerning a significantly under-priced sale of a State’s insolvent company (case ID: 103/6/A/2008, case no. P 36/07).
37. The Constitutional Court held that section 1(1) of the 1990 Act did not breach Article 2 of the Constitution. Firstly, the judicial practice made the meaning of the “unjust benefit” clause sufficiently precise. Secondly, the regulation was proportionate because it was legitimate to protect State property and the decision to provide for a remedy alternative to those already existing under the Civil Code lay within the legislator’s discretion.
38. The Constitutional Court found that the impugned provision did not breach Article 32 of the Constitution as it could not be said that it placed the State Treasury in a privileged position vis-à-vis legal and natural persons who entered into transactions with the State. Including these parties into the impugned regulation would defeat its whole purpose, which was to eliminate the unwanted phenomenon of legal or natural persons making unjust benefits from State property.
COMPLAINT
39. The applicants complain that their rights guaranteed under Article 1 of Protocol No. 1 to the Convention were breached in so far as they had to bear the excessive negative financial consequences of an error that had been made more than a decade earlier by the State.
In particular, they argue that they had not been responsible for the miscalculation of the amount of their compensation equivalent by the State’s property appraiser. This is why they should not have been ordered to refund the State under the doctrine of “unjust gain”.
QUESTION TO THE PARTIES
Were the applicants deprived of their possessions within the meaning of Article 1 of Protocol No. 1? If so, was this interference justified under this provision. In particular, was it proportionate?
APPENDIX
Application no.
Case
Name
Lodged on
Applicant
Year of Birth
1
39942/18
Sak v. Poland
14/08/2018
Helena Sak
1928
2
41347/18
Giebułtowicz v. Poland
14/08/2018
Kazimierz Giebułtowicz
1935
[1] In 1995 Polish zloty was denominated 10,000 to 1.
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