1.Case law Survey:

Ilic v. Croatia, App. no. 00042389/98, Judgment 19 September 2000. (Involving a claim that the Government of Croatia violated Article 1 of Protocol No. 1 by not allowing Petitioner, a citizen of Yugoslavia, to reside in Croatia where she owned a house. The Court found the claim to be inadmissible.)

Brumarescu v. Romania, App. no. 00028342/95, Judgment 28 October 1999. (Involving housing restitution with respect to a house expropriated by the Government of Romania in 1950. The Court held that there had been a violation of Article 1 of Protocol No. 1.)

Kopecky v. Slovakia, App. no. 00044912/98, Judgment 28 October 1999. (Involving claim for property restitution and violations of Article 6(1) of the Convention, guaranteeing the right to a fair trial, and Article 1 of Protocol No. 1.)
Iatridis v. Greece, App. no. 00031107/96, Judgment 25 March 1999. (Involving the expropriation of land by the Government of Greece in 1966 and the eviction of its occupant in 1989. The Court held that there had been a violation of Article 1 of Protocol No. 1.)

Larkos v. Cyprus, App. no. 00029515/95, Judgment 18 February 1999. (Involving an attempt by the Government of Cyprus to evict the Petitioner in 1987. The Court held that there had been a violation of Article 8 of the Convention in conjunction with Article 14, which prohibits discrimination.)

Mentes & Others v. Turkey, App. no. 00023186/94, Judgment 28 November 1997. (Involving the destruction of housing by the Government of Turkey. The Court held that there had been a violation of Article 8 of the Convention and ordered Turkey to pay compensation to the Petitioners.)

Akkus v. Turkey, App. no. 00019263/92, Judgment 24 June 1997. (Involving the expropriation of land and mass evictions by the Government of Turkey in order to construct a dam. The Court held that there had been a violation of Article 1 of Protocol No. 1 and ordered the Government of Turkey to pay compensation.)

Loizidou v. Turkey, App. no. 00015318/89, Judgment 18 December 1996. (Involving the occupation of land and housing by the Government of Turkey in northern Cyprus. The Court held that there had been no violation of Article 8 of the Convention but that there had been a violation of Article 1 of Protocol No. 1 and ordered the Government of Turkey to pay compensation.)

Prötsch v. Austria, App. no. 00015508/89, Judgment 22 October 1996. (Involving a claim of unjust expropriation of land. The Court held that there had been no violation of Article 1 of Protocol No. 1.)

June Buckley v. United Kingdom, App. no. 00020348/92, Judgment 25 September 1996. (Involving a Roma British citizen who lived in a caravan parked on land she owns. Petitioner was denied a permit to establish the caravan on her land and ordered to move. The European Commission on Human Rights found a violation of Article 8 of the Convention but on appeal the Court held that there had been no such violation.)

Akdivar and Others v. Turkey, App. no. 00021893/93, Judgment 16 September 1996. (Involving large-scale evictions, forced relocation and demolition of villages by the Government of Turkey. The Court held that there had been a violation of both Article 8 of the Convention and Article 1 of Protocol No. 1 and ordered the Government of Turkey to pay compensation.)

Zubani v. Italy, App. no. 00014025/88, Judgment 7 August 1996. (Involving the taking of a farm and eviction of its occupants by a municipal government in order that the land could be used for the construction of low-cost and social housing. The Court held that there had been a violation of Article 1 of Protocol No. 1 and ordered the Government of Italy to pay compensation.)

Phocas v. France, App. no. 00017869/91, Judgment 23 April 1996. (Involving the expropriation of land for the improvement of a public road. The Court held that there had not been a violation of Article 1 of Protocol No. 1.)

Spadea and Sclabrino v. Italy, App. no. 00012868/87, Judgment 28 September 1995. (Involved a Petitioners'/Landlords' claims that the Government of Italy unjustly interfered with their property rights through the use of statutory extensions of leases as a means of postponing or suspending evictions. The Court held that there had not been a violation of Article 1 of Protocol No. 1.)

López Ostra v. Spain, App. no. 00016798/90, 9 December 1994. (Involving a petition alleging interference by a public authority with the right to respect the home due to a municipal government's failure to regulate a polluting industry which eventually impacted the health and safety of those living nearby. The Court held that there had been a violation of Article 8 of the Convention and awarded compensation.)

Case of the Holy Monasteries v. Greece, App. nos. 00013092/87 and 00013984/88, Judgment 9 December 1994. (Involving the expropriation of church land by the Government of Greece for distribution to destitute farmers. The Court held that there had not been a violation of Article 1 of Protocol No. 1.)

Papamichalopoulos and Others v. Greece, App. no. 00014556/89, Judgment 24 June 1993. (Involving the expropriation of agricultural land by the Government of Greece for construction of a Naval base. The Court held that there was a violation of Article 1 of Protocol No. 1 and ordered restitution of the land or payment of compensation.)

Powell and Rayner v. United Kingdom, App. no. 00009310/81, Judgment 24 January 1990. (Involving a nuisance claim by Petitioners due to the noise associated with Heathrow Airport. The European Commission of Human Rights found a violation of Article 8 of the Convention and Article 13 of the Convention, requiring an effective remedy for a violation of the Convention. The Petitioners alleged that the United Kingdom violated Article 13 with respect to other claims, including Article 1 of Protocol No. 1. The Court held that there was no violation of Article 13 with respect to other claims.)

Håkansson and Sturesson v. Sweden, App. no. 00011855/85, Judgment 21 February 1990. (Regarding the expropriation of farmland bought at auction. The Court held that there was a violation of Article 6(1) of the Convention which guarantees the right to a fair trial.)

Mellacher and Others v. Austria, App. nos. 00010522/83, 00011011/84, and 00011070/84, Judgment 19 December 1989. (Involving a challenge to a Rent Act which reduced the amount of rent due on Petitioner's property. The Court held that there had not been a violation of Article 1 of Protocol No. 1.)

Allan Jacobsson v. Sweden (No. 1), App. no. 00010842/84, Judgment 25 October 1989. (The Court held that there was a violation of Article 6(1) of the Convention, which guarantees the right to a fair trial, because the Petitioner lacked access to the courts in order to challenge regulations affecting the use of this property.)

Inze v. Austria, App. no. 00008695/79, Judgment 25 September 1987. (Involving inheritance laws which discriminated with respect to out-of-wedlock births. The Court held that there had been a violation of Article 1 of Protocol No. 1 in conjunction with Article 14 of the Convention which prohibits discrimination.)

Gillow v. United Kingdom, App. no. 00009063/80, Judgment 24 November 1986. (Involving a challenge to legislation requiring a license to reside in housing owned by the Petitioner in the town of Guernsey. The Court held that there was a violation of Article 8 of the Convention.)

James and Others v. United Kingdom, App. no. 00008793/79, Judgment 1984. (Involving a challenge to the Leasehold Reform Act of 1967 which allowed long-term tenants to acquire a freehold estate. The Court held that there was no violation of Article 1 of Protocol No. 1.)

Sporrong and Lönnroth v. Sweden, App. nos. 00007151/75 and 00007172/75, Judgment 29 June 1982. (Involving long-term expropriation of property permits, for 23 and 8 years respectively, and the prohibition of construction on the properties in question. The Court held that there had been a violation of Article 1 of Protocol No. 1 due to the long duration in which the property was under threat of expropriation, and therefore construction by the owners was prohibited, even though the expropriation did not take place. The Court adjusted the amount of compensation to be paid to the Petitioners.)

Cyprus v. Turkey, App. no. 00025781/94, Judgment 10 May 2001. (Regarding Greek Cypriots displaced from northern Cyprus. The Court held that there are continuing violations by the Government of Turkey of Article 8 of the Convention and Article 1 of Protocol No. 1.)

2.Summaries:

Sporrong and Lönnroth v. Sweden, judgment of 23 Sept. 1982, Series A, No. 52; (1983) 5 EHRR 35.
full case here

The case concerned some very valuable properties (buildings and land) in central Stockholm in Sweden. The County Administrative Board decided that the properties were needed for development, and so imposed two different kinds of measures: expropriation permits (which meant that the property might in the future be expropriated) and prohibitions on construction (which prevented any construction of any kind). The expropriation permits and prohibitions on construction on the affected land had hung over them for many years without being implemented. One of the properties was subject to an expropriation permit for a total of 23 years and to a prohibition on construction for 25 years. Another property was subject to an expropriation permit for 8 years and to a prohibition on construction for 12 years. During the time when these measures were in place, it obviously became much more difficult to sell the properties. The measures were eventually lifted due to a change in planning policy. The owners of the properties complained to the European Court of Human Rights under Article 1 of Protocol No. 1. They had received no compensation for the time when their properties were affected by the relevant measures.

The first question for the Court was whether there was any interference with property at all, within the meaning of Article 1. The Swedish Government argued that the expropriation permits and prohibitions on construction were simply an intrinsic part of town planning, and did not impair the right to peaceful enjoyment of possessions at all. But the Court was quick to reject this argument. It noted that although legally the owners' title to their property (i.e. ownership) remained intact, in practice the possibility of exercising the right to property was significantly reduced. The Court observed that, by virtue of the expropriation permits, the applicants' right to property became "precarious and defeasible". The Court had no difficulty in viewing the expropriation permits and prohibitions on construction as `affecting the very substance of ownership' because of the limitations they placed on the exercise of the rights of an owner. There was an interference with the applicants' right of property; the Court went on to determine whether the interference constituted a violation of Article 1. It then set out its analysis of Article 1 as comprising three rules:

That Article [Article 1 of Protocol No. 1] comprises three distinct rules. The first rule, which is of a general nature, enounces the principle of peaceful enjoyment of property; it is set out in the first sentence of the first paragraph. The second rule covers deprivation of possessions and subjects it to certain conditions; it appears in the second sentence of the same paragraph. The third rule recognises that the States are entitled, amongst other things, to control the use of property in accordance with the general interest, by enforcing such laws as they deem necessary for the purpose; it is contained in the second paragraph. (para. 61).

The Court began by considering whether the applicants could be said to have been deprived of their possessions (second rule), which would have brought the second sentence of the first paragraph into play. All the effects complained of fell well short of complaints of deprivation. The Court held that there was no expropriation, or deprivation of property. The applicants were at all times entitled, as a matter of law, to use, sell, donate and otherwise deal with the properties. Although it had become more difficult to sell the properties because of the measures in question, it was still possible for the applicants to do so. Therefore, the second sentence of the first paragraph (i.e. the second rule) did not apply.

Since there was no deprivation, there could be no application of the second sentence of the first paragraph. The Court moved on to consider the applicability of the second paragraph (i.e. the third rule). The Court held that this applied to the prohibitions on construction, which involved the control of use of the property. However, the Court concluded that the expropriation permits were not intended to limit or control the use of the property, they had to be considered under the first sentence of the first paragraph (i.e. the first rule), because they were not deprivations of property, nor were they intended to control the use of property. It held:

The fact that the permits fell within the ambit neither of the second sentence of the first paragraph nor of the second paragraph does not mean that the interference with the said right violated the rule contained in the first sentence of the first paragraph. For the purposes of the latter provision, the Court must determine whether a fair balance was struck between the demands of the general interest of the community and the requirements of the protection of the individual's fundamental rights. . . . The search for this balance is inherent in the whole of the Convention and is also reflected in the structure of Article 1. Ibid., para. 69 of judgment. See also Wiesinger v. Austria, judgment of 30 Oct. 1991, Series A, No. 213; (1993) 16 EHRR 258, and Holy Monasteries v. Greece, Judgment of 9 Dec. 1994, Series A, No. 301-A.

The Court also made the following important statement of principle concerning the justification of an interference:

…the Court must determine whether a fair balance was struck between the demands of the general interests of the community and the requirements of the protection of the individual's fundamental rights… The search for this balance is inherent in the whole of the Convention and is also reflected in the structure of Article 1 [of Protocol No. 1]. (para. 69) (emphasis added)

Applying this test, the Court found that the fair balance had been upset in that case. In another significant statement of principle, quoted again and again in its later judgments, the Court stated:

Being combined in this way, the two series of measures created a situation which upset the fair balance which should be struck between the protection of the right to property and the requirement of the general interest: the Sporrong Estate and Mrs Lönnroth bore an individual and excessive burden which could have been rendered legitimate only if they had had the possibility of seeking a reduction of the time-limits or of claiming compensation. Yet at the relevant time Swedish law excluded the possibilities and it still excludes the second of them. (para. 73) (emphasis added)

So it is necessary to consider whether any interference with property strikes a fair balance between the protection of the right to property and the requirement of the general interest. Such a fair balance will not have been struck where the individual property owner is made to bear "an individual and excessive burden". (para. 73).

Bramelid and Malmström v. Sweden (1982), Applications Nos. 8588/79 and 8589/79.
full case here

The case concerned two private individuals who owned shares in a large well-known department store in Stockholm, Sweden. In 1977 a new Company Act was passed, which had the effect that any company which owned more than 90% of the shares and voting rights in another company was entitled to compel the remaining minority of shareholders to sell their shares to it, at the same price as would have been paid if it had purchased the shares through a public offer, or otherwise at a price fixed by arbitrators. The minority shareholders complained to the Commission about the application of the new law to them. They argued that they had had to surrender their shares to the majority shareholders at less than market value. (The price had been fixed by arbitrators).

The Commission first considered whether the shares amounted to "possessions" within the meaning of Article 1 of Protocol No. 1. They considered what a complex thing a share was: a certificate that promises the holder a share in the company, together with corresponding rights (especially voting rights). It also involved an indirect claim on company assets. There was no doubt in this case that the shares had economic value. The Commission therefore considered that the shares were "possessions".

On the question of which of the three rules of Article 1 applied, the Commission considered that the application of the Company Act to the shares of the minority shareholders did not fall within the second, "deprivation", rule as the applicants had argued. The Commission observed that although there was no express reference to "expropriation" in Article 1, its wording showed clearly that the second rule was intended to refer to expropriation, i.e. the action whereby the State lays hands - or authorises a third party to lay hands - on a particular piece of property for a purpose which is to serve the public interest. This interpretation was confirmed by the travaux préparatoires to Article 1. The Commission considered that the legislation complained of was something completely different. It concerned relations between private individuals. So the second sentence did not apply.

The Commission then noted that in all the States Parties to the Convention, the legislation governing private law relations between individuals includes rules which determine the effects of these legal relations with respect to property and, in some cases, compel a person to surrender a possession to another. Examples include the division of inherited property, especially agricultural, the division of matrimonial estates and in particular the seizure and sale of property in the course of execution. The Commission considered that this type of rule, which is essential in liberal society, cannot in principle be contrary to Article 1 of Protocol No. 1. But the Commission nevertheless had to make sure that, in determining the effects on property of legal relations between individuals, the law did not create such inequality that one person could be arbitrarily and unjustly deprived of property in favour of another. In the case before it, it found no such inequality.

Bramelid and Malmström v. Sweden is significant not only because it recognises that share ownership falls within the protection of Article 1 of Protocol No. 1, but also because it makes clear that this Article is capable of applying to legislation which affects legal relations between private individuals.

S v. France, 17 May 1990, (1990) App. 13728/88, 65 DR 250
full case here

The applicants complained that the construction of a nuclear power station on the banks of the Loire opposite their eighteenth century house violated Article 1.. . The complaint was based both on the destruction of the rural setting of their home and the noise and industrial style lighting at the site. The Commission decided that Article I does not `guarantee the right to enjoy ... possessions in a pleasant environment', Ibid., 261 but that noise nuisance of particular severity in both intensity and frequency may seriously affect the value of the property and so constitute an interference with possessions. As in App. 9310/81, Baggs v. United Kingdom 16 Oct. 1985, (1985) 44 DR 13, and see for friendly settlement, 8 July 1987, (1987) 52 DR 29.

But applying the fair balance test to the facts of the case, the Commission decided that the application was manifestly ill-founded.

X v. United Kingdom, App. 4288/69, 17 Mar. 1970, (1970)
full case here

The applicant complained that she did not receive a widow's pension to which she claimed she was entitled by virtue of her own and her late husband's contributions. The Commission recognized that a question might arise under Article 1 if contributions made many years before to a compulsory contributory pensions scheme, which had subsequently been replaced by a comprehensive National Insurance system, could be regarded as creating a vested interest in a pension which might be described as `possessions' within the meaning of Article 1.

The Commission found, however, after examining the legislation in force at the time, that the applicant had not acquired any such vested interest. A widow's pension was payable under that legislation only in respect of her late husband's contributions; and at the relevant period the applicant had not been married.

The Commission also left open the question whether even contributions to a general national insurance system might give rise to acquired rights capable of coming within Article 1. The better view probably is that while Article 1 may protect rights arising out of compulsory contributory pension schemes, where the amount of the pension is directly related to the amount of contributions, it has no application to general social security systems where there is no direct correlation of contribution and benefit.

Pressos Compania Naviera SA v. Belgium (A332 (1995)
full case here

Here the applicants were ship owners whose ships were involved in collisions in the territorial waters of Belgium. They considered that the collisions were due to the negligence of Belgian pilots (for whom the State was responsible according to Belgian law), and brought proceedings against the State. However, after the damage had been suffered, the Belgium passed legislation (Act of 30 August 1988) to remove the right to compensation in the applicable circumstances. The ship owners complained under Article 1 of Protocol No. 1, arguing that their right to property had been violated. The State disputed that the applicants had any "possessions", and argued that they had had no recognised claims which had been determined by a judicial decision having final effect.

The European Court of Human Rights stated that although the concept of "possession" is autonomous, it was relevant to consider the position as a matter of domestic (Belgian) law. It noted that under Belgian law claims for compensation for torts came into existence as soon as damage occurred. Such a claim constituted "an asset" and therefore amounted to a "possession", within the meaning of Article 1 of Protocol No. 1. In addition, based on judicial determinations prior to the passing of the 1988 Act, the applicants could argue that they had a legitimate expectation that their claims could be determined in accordance with the general law of tort. The 1988 Act was held to amount to an interference with the right to property, as it prevented the applicants from enjoying the rights they had had before the Act.

The State also pointed to the need to protect its financial interests, the need to re-establish legal certainty in the field of tort, and the need to bring the position in Belgium into line with that in neighbouring countries, notably the Netherlands. The Court noted that under the Convention system it is for the national authorities to make the initial assessment both of the existence of a problem of public concern warranting measures of deprivation of property and of the remedial action to be taken. The notion of public interest was necessarily extensive. The State therefore had a wide margin of appreciation.

As for proportionality, the Court referred to the fair balance test, and noted that compensation terms under the relevant legislation were relevant to that question. It also made the point that the taking of property without the payment of an amount reasonably related to its value will normally be justifiable only in exceptional circumstances. In this case the 1988 Act extinguished with retrospective effect and without compensation very high claims for damages that the victims of the accidents could otherwise have pursued against the Belgian State. In some cases proceedings were already pending. The State referred to the huge potential claims that would have resulted if the Act had not been passed (3 500 million BEF). The Court concluded that this concern, and the concern to bring the law into line with neighbouring countries, would warrant prospective legislation to alter the law of tort, but these considerations could not justify legislating with retrospective effect with the aim and consequence of depriving the applicants of their claims for compensation. Such a fundamental interference was inconsistent with the fair balance, and Article 1 of Protocol No. 1 had accordingly been violated.

Stran Greek Refineries and Stratis Andreadis v. Greece, A301-B (1994)
full case here

In this case, concerning an arbitration award that had been rendered void and unenforceable by legislation, the Court decided that the interference was neither an expropriation nor a control of use, and had to be dealt with under the first sentence of Article 1.

By a contract made in 1972, Mr Andreadis contracted with the State (then under the control of a military dictatorship) for the construction of a crude oil refinery near Athens in Greece by a company owned by him ("Stran"). The cost was to be about US$ 76 million. The State ratified the contract by legislative decree, but subsequently failed to fulfil its part of the bargain. Once democracy had been restored in Greece, the State considered that the contract was contrary to the national economy and terminated it. Stran had incurred large costs before the contract was terminated. A dispute arose, and Stran brought legal proceedings against the State in Athens. The State argued that the Athens court lacked jurisdiction and that the case should go to arbitration. It proceeded to appoint an arbitration tribunal and requested it to find all the legal claims of Stran unfounded. But instead the arbitration court found in favour of Stran, ordering the payment by the State to Stran of over US$16 million. The State then applied to the court to set aside the award, on the basis that the arbitration court lacked jurisdiction. The State lost in the court of appeal. While the case was subsequently pending in the court of cassation, the State in 1987 enacted a new law, which had the effect of rendering the arbitration award in Stran's favour void and unenforceable. Stran and Mr Andreadis complained to the Strasbourg organs, inter alia, under Article 1 of Protocol No. 1 to the Convention.

Much of the case before the European Court of Human Rights was concerned with Article 6 of the Convention. In relation to Article 1 of Protocol No. 1, the State argued that no "possession" had been interfered with. They contended that an arbitration award could not be equated with the right which might be recognised by such an award. The Court observed that it had to decide whether the award had given rise to a debt in Stran's favour which was sufficiently established to be enforceable. It concluded that it had. The award was on its face final and binding. It did not require any further enforcement measure, and there was no ordinary or special appeal against it. Stran therefore had a property right which fell within the scope of Article 1 of Protocol No. 1 at the time when the annulling law was passed in 1987. The European Court of Human Rights thus held that an arbitration award was a "possession" for the purposes of Article 1 of Protocol No. 1.

The Court then went on to determine whether the requisite fair balance had been struck. The State argued that the measure in question was part of a body of measures designed to cleanse public life of the disrepute attaching to the military regime and to proclaim the power and will of the Greek people to defend the democratic institutions. The applicants' rights were said to derive from a preferential contract prejudicial to the national economy, which had helped to sustain the dictatorship. The applicants argued that it would be unjust for every legal relationship entered into with a dictatorial regime to be invalidated when the regime came to an end.

The Court did not doubt the State's power to terminate a contract which it considered prejudicial to the economic interests of the State. Indeed this was well-established in public international law: a State has sovereign power to terminate a contract concluded with private individuals, provided it pays compensation. This did not, however, extend to certain essential clauses of the contract, such as an arbitration clause. Otherwise it would be possible for a party to evade jurisdiction in a dispute in respect of which arbitration had been agreed. The Court also noted that the State had itself opted for the arbitration procedure whose consequences it then sought to evade. Therefore, by annulling the arbitration award, the legislature had upset the requisite fair balance. Accordingly, there was a violation of Article 1 of Protocol No. 1.

Pine Valley Developments Ltd v. Ireland, (A 222 (1991)
full case here

The applicant Pine Valley Developments Ltd (P V), bought a plot of land in 1978, relying on an existing grant of outline planning permission for industrial development. Subsequently, in 1982, the Irish Supreme Court held that the original grant of outline planning permission was ultra vires and a nullity ab initio, since it was contrary to the relevant legislation. The applicant claimed that the decision of the Supreme Court was contrary to his right to property guaranteed by Article 1 of Protocol No. 1.

The Court asked itself first whether the applicant ever enjoyed any right to develop the land which could be the subject of an interference under Article 1, given the ruling of the Supreme Court, which meant that as a matter of Irish law he enjoyed no such right. The Court held that he did, because when he bought the land he did so in reliance on a permission duly recorded in a public register, which he was entitled to assume was valid. The Court said that in these circumstances it would be "unduly formalistic" to hold that the decision of the Supreme Court did not constitute an interference with the applicant's property.(para. 51). Until that decision was given, the applicant had at least a legitimate expectation that he could carry out the proposed development, and this had to be regarded for the purposes of Article 1 of Protocol No. 1 as a component of the property (i.e. the land) in question.

Van Marle v. the Netherlands, (A101 (1986)
full case here

The applicants had practised as accountants for some years, when in 1972 a new statute was adopted which required them to seek registration by a Board of Admission if they wanted to continue to practise. They applied for registration and this was refused in 1977. An appeal to the Board of Appeal was unsuccessful, after the applicants had been interviewed. The Board took the view that they had provided some unsatisfactory answers and had not shown sufficient professional competence. The applicants claimed that the decision of the Board was contrary to Article 1 of Protocol No. 1 because as a result of it their income and the value of the goodwill of their accountancy practices had diminished. They argued that the decision amounted to an interference with the peaceful enjoyment of their possessions, and that they had been partially deprived of their possessions without compensation.

The State argued that the applicants had no "possessions" for the purposes of Article 1, but the Court disagreed. It held that the right they relied on "may be likened to the right of property" embodied in Article 1. By dint of their own work, the Applicants had built up a clientele; this in many respects had the nature of a private right and constituted an asset and, hence, a "possession".

Further, the refusal to register the applicants radically affected the conditions of their professional activities and the scope of those activities was reduced. Their income fell, as did the value of their clientele and, more generally, their business. Consequently, there was an interference with their right to the peaceful enjoyment of their possessions.

Iatridis v. Greece [GC], no. 31107/96, ECHR 1999-II, (25 March 1999)
full case here

Here, a Mr K.N. had inherited an estate in Greece, on which he decided to build an open air cinema (having obtained the necessary permit from the authorities). There was subsequently a dispute as to ownership of the land on which the cinema was built, and the State claimed it. Notwithstanding this, the State also claimed inheritance tax from K.N.'s heirs in respect of it (in 1976). The dispute as to ownership continued, and in 1978, K.N.'s heirs leased the cinema to the applicant, who restored it. In 1989, the authorities ordered the applicant to be evicted. The eviction order was then forcibly executed, and the cinema given to the local town council.

On the question of whether the applicant had any "possession" within the meaning of Article 1 of Protocol No. 1, the Court reiterated that the concept of "possession" in Article 1 has an autonomous meaning which was certainly not limited to the ownership of physical goods; certain other rights and interests constituting assets could also be regarded as "property rights", and thus as "possessions" for the purposes of Article 1. (para. 54). The Court made it clear that it could not determine the dispute under domestic law as to who owned the land, but noted that before the applicant was evicted he had been responsible for the operation of the cinema under a lease which was formally valid, without any interference from the authorities, as a result of which he had built up a clientele which constituted an asset.

The Court then recited the three rules of Article 1. Since the applicant held a lease of the premises, there was neither an expropriation nor an instance of control of use, but an interference within the first rule of Article 1.

The Court then noted that the order to evict the applicant from the cinema had actually been quashed by the Greek court (despite the fact that the lawfulness of the applicant's interest in the land had never been accepted). That had happened two years earlier, and yet the applicant had not had the land returned. In these circumstances, the Court took the opportunity to make an emphatic statement abut the crucial need for States to comply with the principle of legality, or legal certainty. As the Court noted, if that requirement was not satisfied, there was no need to go further and consider the legitimacy of the State's objective or the question of proportionality. The Court observed that:

The Court reiterates that the first and most important requirement of Article 1 of Protocol No. 1 is that any interference by a public authority with the peaceful enjoyment of possessions should be lawful: the second sentence of the first paragraph authorises a deprivation of possessions only "subject to the conditions provided for by law" and the second paragraph recognises that the States have the right to control the use of property by enforcing "laws". Moreover, the rule of law, one of the fundamental principles of a democratic society, is inherent in all the Articles of the Convention…and entails a duty on the part of the State or other public authority to comply with judicial orders or decisions against it…It follows that the issue of whether a fair balance has been struck between the demands of the general interest of the community and the requirements of the protection of the individual's fundamental rights … becomes relevant only once it has been established that the interference in question satisfied the requirement of lawfulness and was not arbitrary. (para. 58)

The failure to return the land to applicant was "manifestly" in breach of Greek law, and so in clear violation of Article 1 of Protocol No. 1, without looking at any other issue.

Papamichalopoulos and others v. Greece, judgment of 24 June 1993, Series A, No. 260-B; (1993) 16 EHRR 440.
full case here

The applicants were owners of a large area of valuable land in Greece. The land included a beach, and in 1963 the applicants had obtained permission from the Greek Office of Tourism to construct a hotel complex on the site. But thereafter a military dictatorship assumed control in Greece, and in August 1967 the applicants' land (including the beach) was transferred to the Navy. The applicants sought, not surprisingly, to recover the land, but failed. The Navy proceed to construct a naval base on the land and a holiday resort for officers. Despite various court actions in Greece, and some suggestions on behalf of the State that the applicants should get some other land by way of exchange, no redress at all had been made available by the early 1990s, when the applicants applied to the Commission in Strasbourg.

When the case came before the European Court of Human Rights, the Court began by noting that the interference had to be regarded as a continuing violation since 1967. The Court noted that the interference here was not for the purpose of controlling use of property, and so the third rule of Article 1 did not apply. As regards the second rule, the land was never formally expropriated, in the sense that title was not transferred. But since the Convention was intended to safeguard rights that were "practical and effective", it had to be ascertained whether the situation complained of nevertheless amounted to a de facto expropriation.

The Court noted that the Navy Fund actually physically took the applicants' property from them and built on the land. From that date, the applicants were unable to make use of their property or to sell, bequeath, mortgage or make a gift of it. The Court held that the loss of all ability to dispose of the land, taken together with the failure to remedy the situation, entailed sufficiently serious consequences for the applicants' land de facto to have been expropriated.

Comment: Although the saga began during the military dictatorship, governments thereafter sought to maintain the advantage accruing from the occupying the land concerned and there could be no objection to treating this as a continuing situation covered by Greece's relatively recent re-ratification of the ECHR and declaration under Art 25. The attempt to block the complaint on technicalities at a late stage was rightly resisted and the finding about the effect of the occupation was irresistible. It is perhaps surprising that, given the delays besetting attempts to remedy the situation, it was not also argued that there had also been a violation of Art 6(1).

Brumarescu v. Romania, No. 28342/95 (October 28, 1999)
full case here

In this case, the applicant's parents had built a house in Bucharest in 1939. In 1950, the house was nationalised pursuant to a legislation decree without payment of compensation. In 1974, the house was sold by the State to two brothers, who had previously lived in a flat in the house as tenants. In 1993, the applicant brought an action in the Romanian court to establish that the nationalisation was null and void, because his parents fell within an exemption provided for in the decree, as they were unemployed. The court at first instance agreed, and ordered the administrative authorities to transfer the house to the applicant. The applicant went to live in the house, and paid land tax in respect of it. But the Procurator-General, acting on behalf of the brothers to whom the property had previously been transferred, then brought an application on their behalf in the Supreme Court to have the judgment of 1993 quashed. The Supreme Court quashed the judgment of the first instance court on the ground that the house had passed into State ownership under a legislative instrument and that the manner in which such an instrument was applied could not be reviewed by the courts, that being a matter for the executive or the legislature. Thereupon, the tax authorities informed the applicant that the house would be reclassified as State property with effect from 2 April 1996.

When the case came before the European Court of Human Rights, it held, first, that the applicant had a possession in the form of the judgment of the first instance court that the property had never been lawfully nationalised. It then found that the decision of the Supreme Court had been an interference with the right recognised by that judgment. The Court then reiterated that, in determining whether there has been a deprivation of possessions within the second rule, it is necessary to look behind the appearances and investigate the realities of the situation complained of, and held that he had, i.e. the second rule applied. The Court found that the interference fell under the second sentence of the first paragraph of Article 1 of Protocol No. 1. The effect of the Supreme Court of Justice's judgment had been to deprive the applicant of the rights of ownership of the house vested in him by the final judgment in his favour at first instance.

A taking of property within this second rule could be justified only if it was shown, inter alia, to be "in the public interest" and "subject to the conditions provided for by law". Moreover, any interference with the property had also to satisfy the requirement of proportionality. The Court observed that no justification had been offered for the situation brought about by the judgment of the Supreme Court of Justice. In particular no plausible argument had been advanced to show that the deprivation of property had been justified "in the public interest". Further, as at the date of the judgment the applicant had been deprived of ownership of the property for more than four years without the payment of compensation reflecting its true value and his efforts to recover ownership had proved unsuccessful. The Court found that in those circumstances, even assuming that the taking could be shown to serve some public interest, the requisite fair balance had been upset since the applicant had borne and continued to bear an individual and excessive burden. There had accordingly been, and continued to be, a violation of Article 1 of Protocol No. 1 to the Convention.

Tre Traktörer Aktiebolag v. Sweden judgment of 7 July 1989,
Series A no. 159.
full case here

The applicant was a Swedish limited company. It took over the management of a restaurant called "Le Cardinal" (in 1980). The restaurant had previously been granted a licence to serve alcohol. Concerns arose as to the lady who was behind the applicant company, as to her tax affairs and generally as to her ability to manage the restaurant. In July 1983, the County Administrative Board decided to revoke the licence with immediate effect. The company argued that as a result, the restaurant had to be closed the very next day (although this was disputed on behalf of the State). An appeal to a further administrative authority was rejected, as was a claim addressed to the Government for compensation as a result of the withdrawal of the licence.

The applicants complained to the European Court of Human Rights under Article 6 as well as under Article 1 of Protocol No. 1 to the Convention. As to the latter, the State argued that a licence to serve alcohol could not constitute a "possession" for the purposes of Article 1. But the Court, like the Commission, considered that the "economic interests connected with" the running of the restaurant were "possessions" for these purposes. The maintenance of the licence was one of the principal conditions for the carrying on of the applicant company's business, and its withdrawal had adverse effects on the goodwill and value of the restaurant. Such withdrawal constituted an interference with the peaceful enjoyment of possessions.

The Court then recited the three rules of Article 1. It said that, severe though it might be, the interference did not fall within the ambit of the second sentence of the first paragraph. The applicant company, although it could no longer operate "Le Cardinal" as a restaurant, kept some economic interests represented by the leasing of the premises and the property assets contained therein, which it finally sold in 1984. There was therefore no deprivation of property within the second rule. The withdrawal of the licence was therefore a measure for the control of use of property, under the second paragraph of Article 1.

Mellacher v. Austria, (A169 (1989)
full case here

The Court had to consider an interference with a landlord's contractual entitlement to rent (see also S. v. the UK). The applicants jointly owned a large building in Graz in Austria comprising a number of flats leased to tenants. A system of rent control had existed in Austria since World War I. But this did not apply to houses constructed after 1917 or to certain other flats. In 1981 a new Rent Act was introduced after heated debate, to bring about overall reform. It had the effect for the applicants of vastly reducing the rents they were entitled to under existing tenancy agreements. They complained that the legislation interfered with their freedom of contract and entitlement to future rent. The existing rents had been contractually agreed under the old law.

It was not disputed that the reduction in rent made pursuant to the 1981 Act constituted an interference with the applicants' enjoyment of their rights as owners of the building. The applicants claimed that this was a de facto expropriation of their property (the building), and that they had in any event been deprived of their contractual right to receive rent. The Court held that there had been no de facto expropriation of property, as there had been no transfer of the applicants' property, nor had they been deprived of their right to use, let or sell it. Admittedly the effect of the Act was to deprive them of part of their income from the property. This amounted in the circumstances to a control of use of property within the second, control of use, rule.

As for the issue of justification, the applicants contended that the 1981 Rent Act did not serve a legitimate aim. They said it was not calculated to redress a social injustice, but to bring about a redistribution of property. They accepted that this was something which could in principle be done, but argued that there was no problem in existence which required State intervention. They referred to an economic boom which Austria had been experiencing. They put forward statistics showing that accommodation was in fact available, and they claimed that the Act did not have the support of two of the three political parties representing the majority of the population. They argued that it was a measure of a socialist government intended to satisfy a section of the electorate. So it was not a measure, they said, which was in the general interest.

The European Court of Human Rights looked at the explanatory memorandum submitted to the Austrian Parliament by the government when the legislation was introduced. This referred to the need to reduce disparities between the rents payable for equivalent flats. The Act was aimed at making accommodation more easily available at reasonable prices. The Court found that these explanations could not be characterised as manifestly unreasonable. The Act therefore had a legitimate aim in the general interest.

As for the requirement of proportionality, the Court reiterated the fair balance test. The applicants argued that the Act constituted a statutory inducement not to comply with the terms of validly concluded contracts and therefore violated the principle of freedom of contract. The Court observed, however, that in remedial social legislation, and in particular in the field of rent control, it must be open to the legislature to take measures affecting the further execution of previously concluded contracts in order to attain the aim of the policy adopted. The Court further stated that the possible existence of alternative solutions did not of itself render the contested legislation unjustified. Provided that the legislature remained within the bounds of its margin of appreciation, it was not for the Court to say whether the legislation represented the best solution for dealing with the problem or whether the legislative discretion should have been exercised some other way.

The applicants referred to the fact that the effect of the 1981 Act was to reduce their rents by as much as 80% in two cases, and 22% in another. The Commission had found that degree of interference unjustifiable. The State argued that even at a reduced level, the rents compared reasonably with rent that could be charged for other buildings. The Court found that the requisite fair balance had been struck. It took into account, inter alia, that owners were still able to pass on various expenses to tenants, such as insurance cost, and could require the tenants to pay a contribution towards maintenance works. The Act also made transitional provision which meant that landlords were allowed to recover under existing contracts a rent 50% higher than what they would be allowed to obtain under a new lease. There was, therefore, no violation of Article 1 of Protocol No. 1.

Hakancson and Sturesson v. Sweden, judgment of 21 Feb.
1990, Series A, No. 171; (1991) 13 EHRR 1.
full case here

It concerned the right to retain land purchased for 240,000 Swedish kroner at a compulsory sale by auction in order to meet debts of the owners to certain banks. In these circumstances, it was necessary under Swedish law to obtain a permit to retain the land, but the public authorities decided that the land should be used for consolidation with neighbouring properties and refused requests for the permits. The applicants had known of this risk when the property was bought, but relied on verbal assurances that the permits would be issued speedily. As a result of the consolidation proposals, a second compulsory auction of the land was held and the applicants had received 172,000 Swedish kroner less the costs of the valuation and auction.

The Court looked first at the lawfulness and purpose of the interference. This was the rationalization of agriculture, which was considered `undoubtedly' to be a legitimate public interest, which was provided by law. The Court noted that there was a further requirement that `there be a reasonable relationship of proportionality between the means employed and the aim sought to be realised'." The applicants argued that the difference between the price paid by them and the sum received following the second compulsory auction violated the principle of proportionality. Both the Commission and the Court disagreed; there was nothing in the price differential to show that the sum the applicants received was not reasonably related to the value of the estate. There was no violation of Article 1.

Müller v. Austria (1975), Application No. 5849/72.
full case here

Mr Müller had worked as a locksmith in Austria and Luxembourg for many years, making compulsory and voluntary contributions to a State-run old-age insurance scheme. As a result of a treaty entered into between Austria and Luxembourg, part of his contributions could no longer count towards his main pension, but only towards a supplementary pension. This meant that when Mr Müller came to retire in 1970, he did not get as much by way of pension benefit as he had expected.

He argued that the application of the treaty to him involved a violation of his right to property under Article 1 of Protocol No. 1. When considering his argument, the Commission made it clear that the right to an old-age pension is not included as such among the Convention rights. But it decided that the making of compulsory contributions to a pension fund might create a property right in a portion of such a fund and that such a right might be affected by the way the fund was distributed. The Commission was also prepared to assume, without deciding, that voluntary pension contributions could equally give rise to a right safeguarded by Article 1 of Protocol No. 1.

Ultimately, the Commission rejected Mr Müller's claim, on the basis that although Article 1 might guarantee a person the right to derive benefit, it cannot be interpreted as entitling that person to a particular amount. But the decision is important in that it shows that pension rights based on contributions to a fund may fall within the protection of Article 1. This does not of course mean that Article 1 of Protocol No. 1 guarantees entitlement to pension or social security benefits where there is no basis for such benefits as a matter of domestic law.

Lithgow and others v. United Kingdom, Judgment of 8 July 1986, Series A, No. 102; (1986) 8 EHRR 329.
full case here

The applicants were shipbuilding and aircraft building companies, whose interests were nationalised. They did not contest that the State had a legitimate objective for the taking, but argued that the compensation paid was grossly inadequate. The British Government had decided on a system of compensation whereby the applicants' shares (which were nationalised) were valued by reference to their value some three years before the date of transfer of the shares. The Government's case was that this was done in order to avoid a value which was artificially affected by the knowledge that there would be a nationalisation. The applicants argued that the relevant date should be closer to the date of transfer, because the value of the shares had actually gone up. The applicants pointed to the fact that in general international law, in similar cases, it is the date of taking, or transfer, which is taken as the date of assessment.

The Court agreed with the Commission that: the taking of property without an amount reasonably related to its value would normally constitute a disproportionate interference which could not be considered justifiable under Article 1. Article 1 does not, however, guarantee a right to full compensation in all circumstances, since legitimate objectives of "public interest", such as pursued in measures of economic reform or measures designed to achieve greater social justice, may call for less than reimbursement of the full market value. (para. 121).

Significantly, the Court also stated that the standard of compensation may vary depending on the nature of the property and the circumstances of the taking. The standard of compensation required in a nationalisation case may be different from that required in regard to other takings of property, e.g. the compulsory acquisition of land for public purposes (para. 121).

The Court held (rejecting the applicants' argument) that the "margin of appreciation" applied not only to the question of whether the nationalisation was in the public interest, but also to the choice of compensation terms. The Court observed that:

…the Court's power of review in the present case is limited to ascertaining whether the decision regarding compensation fell outside the United Kingdom's wide margin of appreciation; it will respect the legislature's judgment in this connection unless that judgment was manifestly without reasonable foundation. (para. 122)

The applicants had also relied on the require- ment in the second sentence of Article 1 that a deprivation of property be subject to the conditions provided for "by the general principles of international law." They had argued that this requirement meant that the compensation payable to them had to be "adequate, prompt and effective" as required by the general principles of international law. But the Court rejected this argument. It noted that under the general principles of international law themselves, this requirement only applies to non-nationals. Looking at the travaux préparatoires to Article 1, it was clear that the States intended this phrase to apply only to non-nationals.

Chassagnou and Others v. France Applications nos. 25088/94, 28331/95 and 28443/95, Judgement 29 April 1999.
full case here

In this case the applicants were landowners who, under French law, had the exclusive right to hunt on their land. This right was an aspect of the ownership of the land. But the French authorities considered that it could be beneficial to make smaller landowners get together and form an association granting mutual hunting rights to all concerned. They made it compulsory for landowners like the applicants to become members of the association and to give up their exclusive hunting rights to other members of the association to hunt on their land. The applicants (who were animal welfare activists and anti-hunting) claimed that the compulsory transfer of hunting rights was contrary to Article 1 of Protocol No. 1.

It was agreed before the Court that the third, control of use, rule applied. As to public interest, the applicants argued that the law was only for benefit of hunters, and so not in the public interest. The Court rejected that argument. It held that the French authorities were entitled to conclude that it was in the general interest to avoid unregulated hunting.

As to proportionality, the Court held that it upset the fair balance for the applicants to be compelled to transfer their hunting rights to enable others to hunt on their land when they had ethical and moral objections to hunting. In particular, the Court noted the absence of any compensation. (The Government had intended that the ability for landowners such as the applicants to hunt on land belonging to others would be sufficient compensation, but this did not assist the applicants, who did not want to hunt.) In the circumstances, the applicants' right to property as guaranteed by Article 1 of Protocol No. 1 had been violated.

The Court noted that in the present case the applicants did not wish to hunt on their land and objected to the fact that others could come onto their land to hunt. However, although opposed to hunting on ethical grounds, they were obliged to tolerate the presence of armed men and gun dogs on their land every year. This restriction on the free exercise of the right of use undoubtedly constituted an interference with the applicants' enjoyment of their rights as the owners of property. As far as the aim of that interference was concerned, the Court considered that it was undoubtedly in the general interest to avoid unregulated hunting and encourage the rational management of game stocks.

After noting that none of the options mentioned by the Government (possibility for the applicants to enclose their land, or apply for it to be designated as game reserves or nature reserves) would in practice have been capable of absolving the applicants from the statutory obligation to transfer hunting rights over their land to ACCAs, the Court expressed the view that the various forms of statutory consideration mentioned by the Government could not be considered to represent fair compensation for loss of the right of use. It was clear that it was intended in the Loi Verdeille of 1964 for each landowner subject to compulsory transfer to be compensated for deprivation of the exclusive right to hunt on his land by the concomitant right to hunt throughout those parts of the municipality's territory under ACCA control. However, that compensation was valuable only in so far as all the landowners concerned were hunters or accepted hunting. But the 1964 Act did not contemplate any measure of compensation for landowners opposed to hunting, who, by definition, did not wish to derive any advantage or profit from a right to hunt which they refused to exercise.

The Court noted that compulsory transfer of the right to hunt, which in French law was one of the attributes of the right of property, derogated from the principle laid down by Article L. 222-1 of the Countryside Code, according to which no one may hunt on land belonging to another without the owner's consent. The Court further observed that, following the adoption in 1964 of the Loi Verdeille, which had excluded from the outset the départements of Bas-Rhin, Haut-Rhin and Moselle, only 29 of the 93 départements concerned in metropolitan France had been made subject to the regime of compulsory creation of ACCAs, that ACCAs had been voluntarily set up in only 851 municipalities and that the Law applied only to small landholdings, to the exclusion of both large private estates and State land.

In conclusion, notwithstanding the legitimate aims of the Loi Verdeille when it was adopted in 1964, the Court considered that the result of the compulsory-transfer system which it laid down had been to place the applicants in a situation which upset the fair balance to be struck between protection of the right of property and the requirements of the general interest. Compelling small landowners to transfer hunting rights over their land so that others could make use of them in a way which was totally incompatible with their beliefs imposed a disproportionate burden which was not justified under the second paragraph of Article 1 of Protocol No. 1. There had therefore been a violation of that provision.

S. v. the United Kingdom (1986), Application No. 11716/85.
full case here

A woman had lived "as man and wife" for many years with another woman. The other woman was a tenant of the local authority, but the applicant had no legal right in the property or the tenancy. When her partner - the tenant - died, the applicant applied to the English court for the tenancy to vest in her, as surviving partner of the tenant. But the English court held that the law did not allow this: only the surviving spouse of a heterosexual couple that had married could claim a tenancy. Before the European Commission of Human Rights, the applicant relied primarily on Article 8, but also on Article 1 of Protocol No. 1. The Commission rejected the claim. It noted that the applicant had no contractual right, and the mere fact that she had been living in the house did not mean that she had any "possession" for the purposes of Article 1 of Protocol No. 1. Thus, according to the Commission the occupation of property without a legal right was not protected under Article 1 of Protocol No. 1.

James and others v. United Kingdom, judgment of 21 Feb. 1986, Series A, No. 98; (1986) 8 EHRR 123
full case here

The applicants in this case were trustees of the estate of the Duke of Westminster, who owned 2000 houses in a highly desirable part of London. The applicants complained that the estate had lost a very large amount of money as a result of the implementation of a statute, the Leasehold Reform Act 1967, which gave long leaseholders (tenants) the right to buy the freehold (ownership) at less than market value. The 1967 Act applied only to long leaseholds, i.e. to leases of 21 years or more. They also had to be leaseholds granted at a low rent. As a result of being forced to sell the freehold under the Act to some 80 tenants in London who exercised their right to buy, or to "enfranchise", the Duke's estate lost around £2 million, as compared to the market value.

When considering the complaint under Article 1 of Protocol No. 1, the European Court of Human Rights first referred to the "three rules" analysis in Sporrong and Lönnroth v. Sweden. The Court considered that the applicants had been deprived of their properties within the second rule (although the transfer of ownership was not to the State but to other private individuals).

On the question of whether the taking of the properties could be justified by the State, the applicants argued that the relevant legislation could not be in the public interest, because the properties were not taken for the benefit of the community generally. The applicants contended that the transfer of property from one person to another could not, as a matter of principle, be "in the public interest". The Court addressed the question of whether the public interest could be served by a compulsory transfer of ownership from one private individual to another.

The Court added that the taking of property pursuant to a policy calculated to enhance social justice within the community could properly be described as being in the public interest. In so deciding the Court recognised that it was not following the approach of the domestic law of a number of contracting States in relation to expropriation. It then made an important and oft-quoted statement of principle about the State's "margin of appreciation". This statement forms the basis, together with the dicta in Sporrong and Lönnroth v. Sweden, for any consideration of what is a justified interference with property to this day:

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 both of the existence of a problem of public concern warranting measures of deprivation of property and of the remedial action to be taken… Here as in other fields to which the safeguards of the Convention extend, the national authorities accordingly enjoy a certain margin of appreciation.

Furthermore, the notion of "public interest" is necessarily extensive. In particular, as the Commission noted, the decision to enact laws expropriating property will commonly involve consideration of political, economic and social issues on which opinions within a democratic society may differ widely. The Court agreed with the Commission that the references to the `public interest' in the English text and `utilite publique' in the French text are capable of bearing a wide meaning which includes the `implementation of policies calculated to enhance social justice'."

The Court, finding it natural that the margin of appreciation available to the legislature in implementing social and economic policies should be a wide one, will respect the legislature's judgment as to what is "in the public interest" unless that judgment is manifestly without reasonable foundation. In other words, although the Court cannot substitute its own assessment for that of the national authorities it is bound to review the contested measures under Article 1 of Protocol No. 1 and, in so doing, to make an inquiry into the facts with reference to which the national authorities acted. (para. 46) (emphasis added)

The Court went on to find that the aim of the Leasehold Reform Act 1967 - greater social justice in the sphere of housing - was a legitimate aim in the public interest.

The Court then referred to the requirement of proportionality, citing Sporrong and Lönnroth v. Sweden and the test of whether a fair balance had been struck between the demands of the general interest of the community and the requirements of the protection of the individual's fundamental rights. The applicants relied on the fact that other States apparently did not have similarly draconian measures. They argued that in order to be proportionate the measure had to be necessary, in the sense that there was no other alternative. But the Court rejected this submission: it was not for the Court to judge whether the Leasehold Reform Act 1967 constituted the best solution to the problem.

The Court also considered the question of compensation and agreed with the Commission that Article 1, although it is silent on the point, generally requires compensation for a taking of property. The Court noted that in the legal systems of contracting States, the taking of property without any compensation would be justifiable only in exceptional circumstances: otherwise the right to property would be largely "illusory and ineffective". As to the standard of compensation, the Court said that a taking of property without an amount of compensation reasonably related to its value would normally be disproportionate. But Article 1 does not guarantee a right to full compensation in all circumstances:

Legitimate objectives of 'public interest', such as are pursued in measures of economic reform or measures designed to achieve greater social justice, may call for less than reimbursement of the full market value.

The Court went on to find that the requisite fair balance had been struck in this case, although the estate of the Duke of Westminster did not receive the full market value on the transfer of ownership to the tenants. The Court noted that the tenant paid approximately the site value, but nothing for the buildings on the site. This clearly favoured the tenants, but because of the money he (or his predecessors) had paid for the lease (a capital sum) and money spent over the years on repairs, maintenance and improvements, the tenant or his predecessor in title had in effect already paid for the property. Accordingly, there had been no violation of Article 1 of Protocol No. 1.

Scollo v. Italy judgment of 28 September 1995, Series A no. 315-C, p. 56
full case here

In this case, the applicant bought a residential flat in Rome in June 1982 that was occupied by a tenant. The applicant sought eviction of the tenant in March 1983, on the grounds, inter alia, that he (the applicant) was 71 per cent disabled, unemployed, diabetic and needed the flat, and that the tenant had ceased to pay his rent. The applicant was first granted an eviction order by the magistrate in April 1983. However, in accordance with the Italian Government policy of postponing, suspending or staggering the enforcement of eviction orders against residential tenants, the eviction order was suspended on four separate occasions pursuant to a Legislative
Decree (adopted because of a housing shortage) which suspended evictions until 30 June 1985. Eventually, the tenant left the flat of his own accord in January 1995, eleven years and ten months after the applicant first began proceedings for his eviction.

The applicant complained of a violation of his right to property. When the issue came before the European Court of Human Rights, it first considered the application of the three rules of article 1. It noted that there was neither a transfer of property nor, contrary to the applicant's submissions, a de facto expropriation. At all times the applicant retained the possibility of alienating the property, and he received rent - in full until October 1987, and in part between November 1987 and February 1990. As the implementation of the measures in question meant that the tenant continued to occupy the flat, they undoubtedly amounted to control of the use of possessions. Accordingly, the second paragraph of Article 1 of Protocol No. 1 applied.

The Court referred to the fact that the second paragraph of Article 1 reserves to the States the right to enact such laws as they deem necessary to control the use of property in accordance with the general interest. Such laws, it noted, are especially common in the field of housing, which in our modern societies is a central concern of social and economic policies. In order to implement such policies, the legislature must have a wide margin of appreciation both with regard to the existence of a problem of public concern warranting measures of control and as to the choice of the detailed rules for the implementation of such measures. The Court reiterated that it will respect the legislature's judgment as to what is in the general interest unless that judgment is manifestly without reasonable foundation.

The applicant argued that the relevant legislative measures had no legitimate aim; in substance, the fact that the State had no effective housing policy had deprived him of his right to dispose of his flat, since the tenant's interests alone had been protected. The Government was not entitled, he argued, to justify the emergency legislation by invoking the general interest.

The Court observed, however, that the legislative provisions suspending evictions during the period 1984 to 1988 were prompted by the need to deal with the large number of leases that expired in 1982 and 1983 and by the concern to enable the tenants affected to find acceptable new homes or obtain subsidised housing. To have enforced all the evictions simultaneously would undoubtedly, said the Court, have led to considerable social tension and would have jeopardised public order. Therefore, the legislative provisions had a legitimate aim in the general interest, as required by Article 1 of Protocol No. 1.

Going on to deal with the requirement of proportionality, the Court observed that any interference with property must strike a fair balance, and that there had to be a reasonable relationship of proportionality between the means employed and the aim pursued.

The applicant argued that the interference in question was disproportionate. He emphasised that he was a small property owner who wanted to occupy his own flat in order to live there with his family. He referred to the fact that he had been obliged to incur debts to buy another flat. The State for its part invoked the exceptional housing shortage in Italy at that time.

The Court noted that housing shortages are an almost universal problem of modern society. In order to see whether the measures were proportionate to the aims sought to be achieved - protecting tenants on low incomes and avoiding the risk of any prejudice to public order - the Court had to ascertain whether the applicant's tenant was treated in such a way that the requisite fair balance was maintained. The Court noted that the applicant had made it clear to the authorities that he needed the flat, that he had no job and that he was disabled. The authorities had taken no action at all in response. The applicant had not been able to recover his property until the tenant left of his own accord, although he had satisfied the conditions for enforcement of eviction during the period when this procedure was suspended. The Court also noted that the applicant had had to buy another flat and to bring an action to recover rent. All in all, the restrictions on the applicant's use of his flat amounted to a breach of the requirement of proportionality and to a violation of Article 1 of Protocol No. 1.

So Scollo v. Italy is an example of it being argued, unsuccessfully, that the measures in question did not serve a legitimate objective in the public interest. But the applicant did succeed on his argument that even if there was a legitimate objective, the means chosen to serve that objective were disproportionate to that aim.

Comment: The Court did not accept that the non-enforcement of the eviction orders amounted to a de facto expropriation, which would almost certainly required compensation to be acceptable. Instead they were categorised as a control over use which had to be judged as to whether it achieved a fair balance between the applicant's interests and those of the community, which might be achieved according to established case law without there being any need to pay compensation. The prospect of large-scale homelessness understandably influenced the Court in reaching the conclusion that control over evictions did have a legitimate social aim. However, when it came to judging the proportionality of the interference it concentrated only on the effect that this had on the applicant given his personal circumstances and not the appropriateness of this as a measure to deal with the problem. He was successful because his case fell within the statutory conditions for enforcement and there was a complete failure to take account of his requests for assistance in bringing about the eviction, the property being recovered because the tenant left of his own accord. The Court did not question the acceptability of not enforcing eviction orders in general and did not call into question its use as part of a series of measures to tackle the housing problem. Although these were described as `emergency' measures, they had been resorted to for over 40 years and a more critical approach to their acceptability might be thought appropriate. Certainly there was no consideration as whether it would have been possible for some alternative course of action to be pursued which did not impact on private rights and there was no reference to the way what the Court described as `an almost universal problem of modern society' was being handled elsewhere.

X v. The Netherlands, App. 4130/69, 20 July 1971, (1972) 38 CD 9
full case here

The case concerns the pension schemes in the Netherlands. After examining the system of financing the schemes, the Commission concluded:

It is therefore clear, both from the manner in which the funds are administered and from the system of distribution adopted, that this branch of the Dutch social insurance legislation is based on the principle of solidarity which reflects the responsibility of the community as a whole to provide a minimum financial basis for its aged members and for survivors. The contributions which the younger members of the community are obliged to make are collected in a revolving fund from which the older or surviving members of the community receive their pension. The distribution of the pension funds takes into account the economic realities of the period concerned to the extent that persons benefiting from this system receive their pension in accordance with the wage index established for the period in which the pension is paid and not according to that established for the periods in which they made contributions. There is, therefore, no relationship between the contributions made and the pension received in the sense that the amounts paid by the insured person are accumulated with a view to covering the pension benefits accruing to him when reaching pensionable age. Consequently, a person does not have, at any given moment, an identifiable share in the fund claimable by him but he has an expectancy of receiving old-age or survivors pension benefits subject to the conditions envisaged by the Acts concerned .(para. 15)

Hence, the benefits accruing under the schemes did not constitute a property right which could be described as `possessions' under Article 1.

Beyeler v. Italy, Application no. 33202/96, 5 January 2000
full case here

This case concerned a painting by Van Gogh, which the applicant, a Swiss national, bought in 1977 for 600 million lire through an intermediary without disclosing his identity to the vendor. As a result, the declaration of sale which the vendor filed with the Italian Ministry of Cultural Heritage (in accordance with the requirements of Law No. 1089 of 1939) did not mention the applicant's name. In December 1983, the ministry learned that the applicant was the real purchaser of the painting. In May 1988, the applicant sold the work to an American corporation for US$8.5 million, but in November 1988 Italy exercised its right of pre-emption, on the basis of its historical and artistic interest and stating that the applicant had omitted to inform the ministry that the painting had been purchased on his behalf, and bought the painting at the 1977 sale price.

The applicant alleged a violation of article 1 of Protocol No. 1, contending, in particular, that the Italian authorities had expropriated the painting.

The Court noted a number of points pertaining to this case:

- It found that the applicant's dealings with the painting over a period of time were such that he must be regarded as having a possession within the meaning of Article 1 of Protocol No. 1. But the Court did not actually rule that he was the owner of the painting.
- The Court then considered the nature of the interference with the applicant's possession and stated that "The complexity of the factual and legal situation prevents its being classified in a precise category" (para. 106). The applicant had argued that the second rule applied, but the Court, noting that the situation envisaged in the second sentence was only a particular instance of interference with the peaceful enjoyment of property as guaranteed by the general rule in the first sentence of Article 1, decided that it should examine the situation complained of in the light of that general rule.
- the measure complained of - that is, the exercise by the Ministry of Cultural Heritage of its right of pre-emption - had undoubtedly amounted to an interference with the applicant's right to the peaceful enjoyment of his possessions;
- for an interference to be deemed compatible with article 1 of Protocol No. 1, it must be in accordance with domestic law; the Court had limited power to review compliance with domestic law in this case, especially since there was nothing to suggest that the Italian authorities had applied Law No. 1089 of 1939 in a manifestly erroneous fashion or in such a way as to produce an arbitrary outcome;
- the principle of lawfulness also presupposed that the applicable provisions of domestic law were sufficiently accessible, precise and foreseeable; in certain respects, the statute lacked clarity, particularly in that it left open the time limit for the exercise of a right of pre-emption in the event of an incomplete declaration, without indicating how such an omission could subsequently be rectified. The Court stated that that factor alone could not lead to the conclusion that the interference in question had been unforeseeable or arbitrary, but noted that the element of uncertainty in the statute and the considerable latitude it afforded the authorities were material considerations to be taken into account in determining whether its application in this case had struck a fair balance.
- The Court considered that the control by the state of the market in works of art was a legitimate aim for the purpose of protecting a country's cultural and artistic heritage. While the issue in this case did not concern the return of a work of art to its country of origin, the Court recognised that, in relation to works of art lawfully on its territory and belonging to the cultural heritage of all nations, it was legitimate for a state to take measures to facilitate wide public access to them, in the general interest of universal culture.
- The Court did not question either the state's right of pre-emption over works of art or its interest in being informed of all the details of a contract, including the identity of the end purchaser in a sale conducted through an agent, in order to decide in the full knowledge of the facts whether or not to exercise the right of pre-emption.
- The Court noted further that the government had failed to give a convincing explanation as to why the authorities had not acted in 1984 in the same manner as they had acted in 1988; taking punitive action against the applicant in 1988 on the ground that he had made an incomplete declaration - a fact of which the authorities had become aware almost five years earlier - hardly seemed justified. The Court stressed that where an issue in the general interest was at stake, it was incumbent on the public authorities to act in good time, in an appropriate manner and with utmost consistency.
- The Court also noted that the Ministry of Cultural Heritage had acquired the painting in 1988 at well below its market value and the authorities had thus derived an unjust enrichment from the uncertainty that existed during the intervening period and to which they had largely contributed. Irrespective of the applicant's nationality, such enrichment was incompatible with the requirement of a "fair balance."
- The applicant stated that he had been discriminated against, in that the authorities had expressly said that his Swiss nationality made the measure all the more justified. The applicant argued that his nationality should not have been a relevant factor.

The Court decided that there had been a violation of article 1 of Protocol No. 1.

Marckx v. Belgium, judgment of 13 June 1979,
Series A, No. 31, (1979-80) 2 EHRR 330
full case here

In this case the applicant and her infant daughter complained of the fact that certain aspects of the illegitimacy laws in Belgium, including the fact that maternal affiliation could only be established by a formal act of recognition, and the existence of limitations on the mother's right to bequeath, as well as limitations on an illegitimate child's right to inherit, constituted interferences with their right to property under Article 1 of Protocol No. 1 (also read together with Article 14). (Other claims were also made, in particular under Article 8).

The European Court of Human Rights held that Article 1 of Protocol No. 1 did not apply at all to the daughter, noting that this article does no more than enshrine the right of everyone to the peaceful enjoyment of "his" possessions, that consequently it applies only to a person's existing possessions and does not guarantee the right to acquire possessions whether on intestacy or through voluntary dispositions.

AGOSI v. the United Kingdom, judgment of 24 October 1986,
Series A no. 108, p. 19.
full case here

The applicant was a German company, AGOSI, in the business of metal smelting, and also dealing in gold and silver coins. One Saturday afternoon, a Mr X and Mr Y visited the company's factory in Germany and asked to make an immediate purchase of 1 500 krugerrands, which were gold coins minted in South Africa. The value of the coins was £120 000. The sale was agreed and the coins were loaded into a car with British number plates. Payment was accepted in the form of a cheque drawn on an English bank. AGOSI sought to cash the cheque, but it was dishonoured. The contract of sale for the gold coins contained a term that ownership of the coins remained with AGOSI until payment in full had been received. Meanwhile, the buyers tried to bring the coins into the United Kingdom hidden in a spare tyre in the car. But the coins were discovered and were seized by the United Kingdom customs authorities. A few months earlier, the importation of gold coins had been prohibited by the Secretary of State for Trade and Industry. The buyers of the coins, Messrs X and Y, were charged with fraudulent evasion of the prohibition on importation of gold coins (smuggling). AGOSI shortly thereafter requested the return of the coins to them, on the basis that they remained their rightful owner, as they had not been paid. The customs authorities declined to restore the coins. Mr X and Mr Y were convicted in the criminal court. Even at that stage the customs authorities refused to return the coins to AGOSI. The company unsuccessfully sued in the English court for their return.

Before the European Court of Human Rights, AGOSI complained, inter alia, of the refusal by the customs authorities to restore the coins. The company argued that it was the lawful owner of the coins and innocent of any wrongdoing, and that it had not been given a proper opportunity of putting its case before the English courts. The Strasbourg Court noted that the retention (forfeiture) of the coins clearly amounted to an interference with peaceful enjoyment of possessions within the first sentence of Article 1: this had not been disputed. But the Court then had to determine whether the material provision was the second sentence of the first paragraph or the second paragraph. It observed that the prohibition on the importation of gold coins clearly constituted a control of the use of property. The seizure and forfeiture of the coins were measures taken for the enforcement of that prohibition. It also noted that the forfeiture of the coins did of course involve a deprivation of property, but in the circumstances the deprivation formed a constituent element of the procedure for the control of the use in the United Kingdom of gold krugerrands. Accordingly, the third, control of use, rule applied.

As to whether the measures could be justified, the Court noted that the prohibition on the importation of krugerrands was undoubtedly compatible with Article 1 of Protocol No. 1. It served a legitimate objective in the public interest. But it was also necessary to consider whether there was a reasonable relationship of proportionality between the means used to enforce the prohibition and the aim sought to be realised. The court had to determine whether the requisite fair balance had been struck. The Court observed that:

The State enjoys a wide margin of appreciation with regard both to choosing the means of enforcement and to ascertaining whether the consequences of enforcement are justified in the general interest for the purpose of achieving the object of the law in question. (para. 52)

The Court noted that under the general principles of law recognised in all contracting States, smuggled goods may as a rule be the object of confiscation. But AGOSI argued (and the Commission had agreed) that this did not apply when the owner was "innocent". The Court noted that the striking of a fair balance depends on many factors, and that the behaviour of the owner of property (in relation to smuggling), including the degree of fault or care which he displayed, is one element in the entirety of circumstances which should be taken into account. (The Court also noted that there was no common practice in contracting States as to whether fault was required for forfeiture.)

Accordingly, although this is not expressly mentioned in Article 1, the Court had to consider whether the applicable procedures were such as to enable reasonable account to be taken of the applicant's degree of fault or care, and also to see whether the applicable procedures afforded the company a reasonable opportunity of putting its case to the responsible authorities. The Court examined the English procedure of judicial review and found that it was sufficient to satisfy Article 1 of Protocol No. 1. Accordingly, there had been no violation of AGOSI's right to property.

Gasus Dosier- und Fordertechnik v. the Netherlands,
1995 Series A no 306-B p 46.
full case here

The applicant, Gasus, was a German company that made an agreement with a Dutch company, Atlas, for the sale to Atlas of a concrete-mixer. Gasus' standard terms and conditions of sale included a "retention of title clause" which meant that they retained ownership in the concrete- mixer until it had been paid for in full. Atlas got into financial difficulties, and the concrete- mixer was seized by the Dutch tax bailiff in respect of Atlas' unpaid tax debts before payment had been received by Gasus. The German seller alleged that the seizure of the goods by the Dutch authorities involved a violation of its right to property under Article 1 of Protocol No. 1. The European Court of Human Rights held that the case fell to be considered under the third rule of Article 1, on the basis that the seizure of the goods was part of the State's machinery for the collection of taxes.

Interestingly, as a first point the State argued that the company did not actually retain ownership in the mixer, but simply had an interest in the nature of security. They said that on this basis Gasus did not have any possession. But the Court was quick to reject that argument. It recalled that "possession" has an "autonomous" meaning for the purposes of Article 1, and was certainly not limited to ownership of physical goods. It was therefore quite immaterial whether Gasus retained ownership or merely had a security interest in the mixer. Either way, they had a protected possession under Article 1 of Protocol No. 1.

As to which of the three rules applied, Gasus argued that they had been deprived of their property under the second rule. But the Court held that the seizure of the mixer was part of the State's machinery for the collection of taxes and so fell to be considered under the second paragraph of Article 1, which enables States to "secure the payment of taxes or other contributions or penalties".

In this context the Court reminded itself that the drafters of the Convention had attached great importance to this aspect of the second paragraph of Article 1: in fact at a stage when this phrase was not yet included, it was already understood by all concerned, said the Court, that States could pass whatever fiscal laws they considered desirable, provided always that they did not amount to "arbitrary confiscation". Here, said the Court, there was no arbitrary confiscation, albeit that the law permitted the tax authorities to seize goods on the tax payer's premises that did not actually belong to it, but to a third party. The Court found support for its view in the fact that this kind of thing was permitted in several legal systems.

The Court then went on to record that the State has a wide margin of appreciation regarding taxing measures, and that its judgment would be respected unless "devoid of reasonable foundation". It cited Sporrong and Lönnroth v. Sweden84 and referred to the requirement of fair balance and proportionality. It also asked itself whether Gasus had been made to bear "an individual and excessive burden".

Applying these tests, the Court found that the seizure of the mixer was compatible with Article 1 of Protocol No. 1. It took into account, in particular: (1) that Gasus was engaged in a commercial venture which by its nature involved risk; (2) that the retention of title clause would provide security against creditors other than the tax authorities; (3) that Gasus could have eliminated the risk altogether by declining to extend credit to Atlas; (4) that it could have obtained additional security, e.g. by insurance; and (5) that Gasus permitted the mixer to be on Atlas' premises.

This case illustrates that, although the Court applies the same test of fair balance to a taxing measure as to other interferences with property, the State is afforded a particularly wide margin of appreciation in cases of this kind.

Comment: Although G did not seek to rely on Prot 1 in the domestic proceedings, those did actually give an opportunity for that issue to be addressed and that was, therefore, enough to satisfy the exhaustion requirement. This may seem a little perverse given G's actual denial that it was applicable but the purpose of the rule is to prevent the State from being prejudiced and it could hardly complain that it was unaware of the issue. The Court's lack of concern about the precise nature of G's interest in the mixer indicates that it is prepared to take an expansive view of the concept of possessions, relying on the French term 'biens' to justify this. Protect