Last Updated on November 5, 2019 by LawEuro
THIRD SECTION
CASE OF TITOVA AND OTHERS v. RUSSIA
(Applications nos. 4919/16 and 2 others – see appended list)
JUDGMENT
STRASBOURG
15 May 2018
This judgment is final but it may be subject to editorial revision.
In the case of Titova and Others v. Russia,
The European Court of Human Rights (Third Section), sitting as a Committee composed of:
Alena Poláčková, President,
Dmitry Dedov,
Jolien Schukking, judges,
and Fatoş Aracı, Deputy Section Registrar,
Having deliberated in private on 10 April 2018,
Delivers the following judgment, which was adopted on that date:
PROCEDURE
1. The case originated in three applications (nos. 4919/16, 16430/16 and 39274/16) against the Russian Federation lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (“the Convention”).Their details appear in Appendix I below.
2. The applicants were represented by Ms A. Maralyan, a lawyer admitted to practise in Armenia. The Russian Government (“the Government”) were represented initially by Mr G. Matyushkin, former Representative of the Russian Federation to the European Court of Human Rights, and then by his successor in that office, Mr M. Galperin.
3. On 23 and 28 November 2016 complaints under Article 8 of the Convention and Article 1 of Protocol No. 1 to the Convention were communicated to the Government and the remainder of the applicationswere declared inadmissible pursuant to Rule 54 § 3 of the Rules of Court.
THE FACTS
THE CIRCUMSTANCES OF THE CASE
4. The applicants are Russian nationals. They were owners of flats in Moscow. The municipal authorities reclaimed the flats, and the applicants’ title to the real property in question was annulled.
A. Transactions in respect of the flats later purchased by the applicants
5. In 1977 a number of flats in a residential building located at 15-3 Ulitsa Tsyurupy, Moscow,were assigned by the City of Moscow to the Ministry of Communications. The flats were used as temporary housing for foreign specialists seconded to the Ministry. In 1991 the flats were transferred to the Rostelekom Open Joint Stock Company, the Ministry’s successor.On 18 February 2009 the flats were transferred from Rostelekom to the City of Moscow. It appears that the flats remained vacant.
6. In 2008-2009 a group of people, including a police officer, a lawyer, a notary and several Rostelekom employees, forged documents pertaining to three flats located at 15-3 Ulitsa Tsyurupy, Moscow, showing that the flats were owned by private individuals and, following their deaths, were inherited by their “heirs”. The relevant property deeds were forged by notary K. and then registered by the City Registration Department. Then the “heirs” sold the flats to private parties. Subsequently the flats were bought by the applicants. Each transaction with the flats was reviewed and approved by theCity Registration Department.
B. Criminal proceedings on the fraud charges
7. On 8 August 2012 a criminal investigation was opened into the City’s loss of title to the flats.
8. On 7 December 2012 the Housing Department of the City of Moscow (the “Housing Department”) was recognised as a victim of the crime.
9. On 9 December 2013 the Perovskiy District Court of Moscow found nine defendants, including several Rostelekom employees, guilty of fraud. The court established, inter alia, that the defendants had forged the documents and had had unlawfully registered the flats as private property to the detriment of the City of Moscow. Notary K. was questioned as a witness.
10. On 11 March 2014 the Moscow City Court upheld the judgment of 9 December 2013 on appeal.
11. According to the Government, notary K. was also found guilty of fraud and sentenced to a term of imprisonment.
C. Termination of the applicants’ title to the flats
12. In 2014 the Housing Department brought civil actions seeking restitution of the flats.
13. The Cheremushkinskiy District Court of Moscow granted the Housing Department’s claims. The court invalidated the transactions in respect of the flats and the applicants’ title to the flats and ordered their eviction. The court applied the domestic law provisions which allowed the owner to recover its property from a bona fide purchaser if the said property left the owner’s possession against its will. The court considered that the City of Moscow had not had intent to divest itself of the flats and had a right to recover the stolen flats from the applicants.
14. The Moscow City Court upheld the judgmentsof the District Court on appeal. As regards Ms Titova (application nos. 4919/16), the City Court discerned no evidence in the material of the case file that would substantiate her claim that she had bought the flat in good faith. The City Court took into account that she had bought the flat a month and a half after the previous transaction and that the purchase price of the flat had been obviously lower than its market value. In the City Court’s view, Ms Titova, if having acted with due care and diligence, should have had doubts as to the legitimacy of seller’s title and sale of the flat.
15. Subsequently, the City Court refused to grant the applicants leave to bring a cassation appeal against the judgments in their respective cases.
16. According to the Government, the applicants were not evicted and continue to reside in the flats.
17. The details pertaining to each case are summed up in Appendix II below.
THE LAW
I. JOINDER OF THE APPLICATIONS
18. In accordance with Rule 42 § 1 of the Rules of the Court, the Court decides to join the applications, given their similar factual and legal background.
II. ALLEGED VIOLATION OF ARTICLE 1 OF PROTOCOL No. 1 TO THE CONVENTION
19. The applicants complained that they had been deprived of their possessions in violation of Article 1 of Protocol No. 1 to the Convention, which provides, in so far as relevant, as follows:
“Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law.
The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties.”
A. Admissibility
1. Compatibility ratione personae
20. The Government considered that the applicants had lost their property as a result of the unlawful actions of a private notary and, accordingly, the State could not be held responsible for their loss.
21. The applicant argued that, as established by the Russian legislation, a notary performed the notarial acts, in the name of the Russian Federation and therefore, the State should be held responsible for the unlawful actions in their case.
22. The Court observes that that the applicants’ complaint is directed against the City of Moscow, a municipality for whose actions the Russian Federation may be held responsible. It was the action lodged by the City that led to the forfeiture of the property title by the applicants and its transfer to the City. The fact that the City had earlier lost its possession as a result of fraudulent actions of third parties, including the notary, has no bearing on the respondent State’s standing. Accordingly, the Court dismisses the Government’s objection as regards the compatibility of the applicants’ complaint ratione personae.
2. Compatibility ratione materiae
23. The Government submitted that the complaints lodged by Ms Ivanova, Ms Andriyakhina and Ms K. Demina should be dismissed as incompatible ratione materiae with the Convention provisions. At no time had they held a title to the flats.
24. The applicants did not comment.
25. The Court observes that, as pointed out by the Government, Ms Ivanova, Ms Andriyakhina and Ms K. Demina were not owners of the flats. They presumably resided there only as members of the flat owner’s family. Nor does the Court discern any information in the materials submitted by those applicants that would allow it to conclude that their occupancy right constituted a “possession” within the meaning of Article 1 of Protocol No. 1 to the Convention. It follows that their complaint is incompatible ratione materiae with the provisions of the Convention within the meaning of Article 35 § 3 and must be rejected pursuant to Article 35 § 4 (compare, Pchelintseva and Others v. Russia, nos. 47724/07 and 4 others, §§ 77-79, 17 November 2016).
3. Exhaustion of domestic remedies
26. The Government considered that the complaint should be dismissed for the applicants’ failure to bring an action for damages against the persons who had been found guilty of fraud in respect of the flats later purchased by the applicants. Alternatively, the applicants could have sued the persons who had sold the flats to them. The Government cited the cases ofUniya OOO and Belcourt Trading Companyv. Russia(nos. 4437/03 and 13290/03, §§ 285 and 353, 19 June 2014, where the State paid the damages to the applicant company and the latter was found to have lost its victim status), and Beverley v. Hungary((dec.), no. 59403/13, ECHR 11 February 2014; where the applicant’s flat was fraudulently acquired by a private party). The Government further suggested that the applicants could have brought an action for damages against notary K. who had forged property deeds. In that respect the Government cited national cases in which a private party had been successful in suing the notary for damages.
27. The applicants submitted that, by lodging an appeal against the judgment recalling the first applicant’s title to the flat, they have exhausted effective domestic remedies in respect of their complaint.
28. The Court notes that it has already examined the issue of exhaustion of effective domestic remedies in a case where the applicant was deprived of her housing as a result of the revocation of her title to a flat by a final and enforceable judgment (see Gladysheva v. Russia, no. 7097/10, §§ 60-62 and 89, 6 December 2011). The Court concluded that, under Russian law, there was no further recourse against that judgment that might potentially lead to reinstatement of the applicant’s title to the flat. It further noted that the possibility of bringing an action for damages, in those circumstances, could not deprive the applicant of victim status for the purpose of complaints under Article 1 of Protocol No. 1 to the Convention. Nor could doing so be regarded as necessary for compliance with the rule of exhaustion of domestic remedies within the meaning of Article 35 § 1 of the Convention. Lastly, the Court considered that any damages that the applicant might have been able to recover against the seller of the flat might only be taken into account for the purposes of assessing the proportionality of the interference and, calculation of pecuniary damage if a violation of Article 1 of Protocol No. 1 to the Convention was found by the Court, and if just satisfaction was awarded under Article 41 of the Convention (ibid., § 62).
29. The Court considers that those findings hold true in the context of the present case. The Government have not put forward any fact or argument capable of persuading it to reach a different conclusion. Accordingly, it was not incumbent on the applicants to pursue the civil remedies referred to by the Government. The Government’s objection in this regard is, therefore, dismissed.
4. Conclusion
30. The Court notes that the complaint introduced by Ms T. Titova, Mr M. Andriyakhin and MsO. Deminais not manifestly ill-founded within the meaning of Article 35 § 3 (a) of the Convention. It further notes that it is not inadmissible on any other grounds. It must therefore be declared admissible.
B. Merits
1. The parties’ submissions
31. The applicants submitted that their cases bore close resemblance to the case of Gladysheva (cited above), in which the Court had found that the transfer of the flat acquired by the applicant in good faith to the municipality had not been proportionate to the legitimate aim pursued and had placed an excessive burden on her. They also doubted that the interference with their rights had not been in accordance with law or that it had pursued a legitimate aim.
32. The Government submitted that there had been no interference with the applicants’ possessions. In their view, the judgments delivered by the national courts concerned the issues of private law and should not be construed as unjustified interference with the applicants’ property rights. The flats purchased by the applicants and later recovered by the City of Moscow were not the applicants’ “possessions” within the meaning of Article 1 of Protocol No. 1 to the Convention. When considering the disputes between the City and the applicants, the national courts had applied the law correctly. The flats owned by the City had been misappropriated as a result of fraudulent actions and the City had a right to reclaim them. The applicants could not be recognised as bona fide purchasers of the flats given that they had bought them for a price significantly lower than the flats’ market value. In addition, Ms Titova had bought the flat only a month a half after the previous transaction. The applicants had done nothing to minimise their losses. They had not asked the city authorities for provision of social housing. They had not sued the persons who had sold them the flats to them to recover the lost money or the perpetrators who had been found guilty of having fraudulently acquired the City’s property or the insurance company which had insured notary K.’s professional responsibility. Lastly, the Government argued that the interference with the applicants’ rights had been proportionate to the legitimate aim pursued.
2. The Court’s assessment
33. The Court has, on a number of previous occasions, examined cases in which the Russian State or municipal authorities, being the original owners of housing, have been successful in reclaiming it from bona fide owners once it had been established that one of the prior transactions in respect of such property had been fraudulent (see Gladysheva, cited above, §§ 77-83; Stolyarova v. Russia, no. 15711/13, §§ 47-51, 29 January 2015; Andrey Medvedevv. Russia, no. 75737/13, §§ 42-47, 13 September 2016; Kirillova v. Russia, no. 50775/13, §§ 33-40, 13 September 2016; Anna Popovav. Russia, no. 59391/12, §§ 33-39, 4 October 2016; Alentsevav. Russia, no. 31788/06, §§ 55-77, 17 November 2016; Pchelintseva and Others, cited above, §§ 90-101; and Ponyayeva and Others v. Russia, no. 63508/11, §§ 45-57, 17 November 2016). Having examined the specific conditions and procedures under which the State had alienated its assets to private individuals, the Court noted that they were within the State’s exclusive competence and held that the defects in those procedures resulting in the loss by the State of its real property should not have been remedied at the expense of bona fide owners. The Court further reasoned that such restitution of property to the State or municipality, in the absence of any compensation paid to the bona fide owner, imposed an individual and excessive burden on the latter and failed to strike a fair balance between the demands of the public interest on the one hand and the applicants’ right to the peaceful enjoyment of their possessions on the other.
34. Turning to the circumstances of the present case, the Court sees no reason to hold otherwise. The Court notes that the flats left the City’s “possession” as a result of the alleged fraud committed by a group of perpetrators. The Court further notes that there were safeguards in place to ensure that the flats changed hands in accordance with the domestic law. The lawfulness of each transaction and title in respect of the flats were subject to control by registration authorities. The Government, however, did not proffer any explanation, as to why those safeguards had not been effective in detecting the fraud and protecting the City’s interests. In particular, neither the domestic judicial authorities nor the Government clarified why it had been possible for the registration authorities to approve the transfer of title to the flats to new owners while the flats had always been the City’s property and the City had not been a party to the relevant transactions. The Government did not proffer any explanation, as to why the state registration authorities had failed to detect the fraud, had accepted the forged judgment as authentic and had approved the transactions with the flat. In such circumstances, the Court concludes that it was the faulty registration procedure that led to the loss of property title by the City in respect of the flats. The registration authorities failed to detect the fraud and protect the City’s interests.
35. The Court also rejects the Government’s argument that the applicants did not buy the flats in good faith. In the Court’s view, the frequency of the transactions with the flats and their low purchase price referred to by the Government are not sufficient to justify such assertion.
36. Lastly, the Court accepts that, as suggested by the Government, it was open to the applicants to recover their losses by bringing an action for damages against the sellers of the flats or the perpetrators who had fraudulently acquired the title to the flats or their insurance companies. As to the action for damages against the sellers of the flats, the Government essentially suggest that the applicants pass their burden on to another bona fideowner, and it is hard for the Court to see how that would improve the balance between the public interest and the need to protect individuals’ rights. As to the action for damages against the perpetrators or their insurance companies, the Court is not convinced that the Government have demonstrated that such an action would have any prospect of success. In this respect, the Court notes that the City of Moscow was recognised as the victim in the course of the criminal proceedings against those persons. However, the City chose not to sue the perpetrators or their insurance companies to recover its own losses.In any event, the Court reiterates that any compensation the applicants might receive would be relevant for the evaluation of their losses, potentially for the purposes of Article 41 of the Convention (see paragraph 28above).
37. Regard being had to the above, the Court considersthat it was not for the applicants to assume the risk of the title to the flats being revoked on account of the omissions on the part of the authorities in procedures specially designed to prevent fraud in real-property transactions. The Court reiterates that mistakes or errors on the part of State authorities should serve to benefit the persons affected. In other words, the consequences of any mistake made by a State authority must be borne by the State and errors must not be remedied at the expense of the individual concerned (see Stolyarova, cited above, § 49). It concludes that the forfeiture of the title to the flats by the applicants and the transfer of the ownership of the flats to the City of Moscow, in the circumstances of the case, placed a disproportionate and excessive burden on them. There has therefore been a violation of Article 1 of Protocol No. 1 to the Convention.
III. ALLEGED VIOLATION OF ARTICLE 8 OF THE CONVENTION
38. The applicants complained that the order for their eviction had amounted to a violation of their right to respect for home. They relied on Article 8 of the Convention, which reads as follows:
“1. Everyone has the right to respect for his private and family life, his home and his correspondence.
2. There shall be no interference by a public authority with the exercise of this right except such as is in accordance with the law and is necessary in a democratic society in the interests of national security, public safety or the economic well-being of the country, for the prevention of disorder or crime, for the protection of health or morals, or for the protection of the rights and freedoms of others.”
39. The Government reiterated their arguments advanced in connection with the applicant’s complaint under Article 1 of Protocol No. 1 to the Convention.
40. The applicants maintained their complaint.
41. The Court notes that this complaint is linked to the one examined above and must therefore likewise be declared admissible. However, having regard to the findings relating to Article 1 of Protocol No. 1 to the Convention (see paragraphs33-37 above), the Court considers that it is not necessary to examine separately the admissibility or the merits the complaint under Article 8 of the Convention (see, mutatis mutandis, Güler and Uğur v. Turkey, nos. 31706/10 and 33088/10, §§ 58-59, 2 December 2014).
IV. APPLICATION OF ARTICLE 41 OF THE CONVENTION
42. Article 41 of the Convention provides:
“If the Court finds that there has been a violation of the Convention or the Protocols thereto, and if the internal law of the High Contracting Party concerned allows only partial reparation to be made, the Court shall, if necessary, afford just satisfaction to the injured party.”
A. Damage
43. The applicants’ claims in respect of pecuniary and non-pecuniary damage are summarised in the table below:
| Application no. | Pecuniary damage | Non-pecuniary damage
(euros (EUR))
|
| 4919/16 | 9,340,000 Russian roubles (RUB) | 30,000 to each of the applicants |
| 16430/16 | title to the flat or RUB 8,210,000 | 30,000 to each of the applicants |
| 39274/16 | title to the flat or RUB 9,530,000 | 30,000 to each of the applicants
|
44. The Government contested these sums as excessive, unsubstantiated and unreasonable.
45. The Court takes into account that in the present case it has found a violation of the applicants’ rights guaranteed by Article 1 of Protocol No. 1 to the Convention in respect of the first applicant in each application. It considers that there is a clear link between the violations found and the damage caused to the applicants.
46. The Court reiterates that, normally, the priority under Article 41 of the Convention is restitutio in integrum, as the respondent State is expected to make all feasible reparation for the consequences of the violation in such a manner as to restore as far as possible the situation existing before the breach (see, among other authorities, Piersack v. Belgium (Article 50), 26 October 1984, § 12, Series A no. 85; Tchitchinadze v. Georgia, no. 18156/05, § 69, 27 May 2010; Fener Rum Patrikliği (Ecumenical Patriarchy) v. Turkey (just satisfaction), no. 14340/05, § 35, 15 June 2010, § 198; and Stoycheva v. Bulgaria, no. 43590/04, 19 July 2011). Consequently, having due regard to its findings in the instant case and to the fact that the applicants did not receive compensation for loss of title to the flat in the domestic proceedings, the Court considers that the most appropriate form of redress would be to restore the applicants’ title to the flats. Thus, the applicants would be put as far as possible in a situation equivalent to the one in which they would have been had there not been a breach of Article 1 of Protocol No. 1 to the Convention (compare, Gladysheva, cited above, § 106). In the alternative, if the Government no longer own the flats, or if they have been otherwise alienated, the Government should ensure that the applicants receive equivalent flats.
47. In addition, the Court has no doubt that the applicants have suffered distress and frustration on account of the deprivation of their possessions. Making its assessment on an equitable basis, the Court awards to the first applicant in each application EUR 5,000 in respect of non-pecuniary damage, plus any tax that may be chargeable on that amount.
B. Costs and expenses
48. The applicants also claimed EUR 3,000 for the costs and expenses incurred before the Court in respect of each application.
49. The Government submitted that the applicants’ claims had not been confirmed by appropriate receipts.
50. Regard being had to the documents in its possession and to its case‑law, the Court considers it reasonable to award the sum of EUR 1,000 for costs and expenses in the proceedings before the Court in respect of each application.
C. Default interest
51. The Court considers it appropriate that the default interest rate should be based on the marginal lending rate of the European Central Bank, to which should be added three percentage points.
FOR THESE REASONS, THE COURT, UNANIMOUSLY,
1. Decides to join the applications;
2. Declares the complaint lodged under Article 1 of Protocol No. 1 to the Convention by Ms T. Titova, Mr M. Andriyakhin and Ms O. Deminaadmissible and the complaint lodged under the same provision by the remaining applicants inadmissible;
3. Holdsthat there has been a violation of Article 1 of Protocol No. 1 to the Convention;
4. Holdsthat there is no need to examine separately the complaint under Article 8 of the Convention;
5. Holds
(a) that the respondent State shall ensure, by appropriate means, within three months, full restitution of the applicants’ title to the flats and the annulment of their eviction orders;
(b) that the respondent State is to pay the first applicant in each application, within three months, the amounts as indicated in Appendix II, plus any tax that may be chargeable to the applicants, to be converted into the currency of the respondent State at the date of settlement;
(c) that from the expiry of the above-mentioned three months until settlement simple interest shall be payable on the above amounts at a rate equal to the marginal lending rate of the European Central Bank during the default period plus three percentage points;
6. Dismissesthe remainder of the applicants’ claim for just satisfaction.
Done in English, and notified in writing on 15 May 2018, pursuant to Rule 77 §§ 2 and 3 of the Rules of Court.
Fatoş Aracı Alena Poláčková
Deputy Registrar President
APPENDIX I
Details of the applications
| No. | Application no. | Date of introduction | Applicants’ details
(family relations, date of birth, place of residence) |
| 1. | 4919/16 | 18/01/2016 | Tatyana Alekseyevna TITOVA
21/04/1981 Moscow Galina Arkadyevna IVANOVA (first applicant’s mother) 14/09/1954 Moscow |
| 2. | 16430/16 | 21/03/2016 | Mikhail Vladimirovich ANDRIYAKHIN
03/08/1969 Moscow Natalya Yuriyevna ANDRIYAKHINA (first applicant’s wife) 27/05/1970 Moscow |
| 3. | 39274/16 | 04/07/2016 | Olga Yakovlevna DEMINA
26/03/1967 Moscow Klara Aleksandrovna DEMINA (first applicant’s mother) 29/11/1939 Moscow |
APPENDIX II
Facts in respect of each application
| No. | Application no. | Address of the flat in Moscow | Annulment of the applicants’ title to the flat
|
|||
| State registration of the private parties’ title to the flats | Subsequent transactions with the flats | Date of the judgment of the Cheremushkinskiy District Court | Appeal proceedings | |||
| 1. | 4919/16 | 15-3-154 Ulitsa Tsyurupy | On 17 December 2008 the City Registration Department registered Sol.’s title to the flat. | On 1 March 2010 Sol. sold the flat to A.
On 22 April 2010 A. sold the flat to the first applicant.
|
23 December 2014 | On 10 August 2015 the Moscow City Court upheld the judgment of 23 December 2014 on appeal.
On 20 November 2015 the City Court refused to grant the applicants leave to bring a cassation appeal. |
| 2. | 16430/16 | 15-3-159 Ulitsa Tsyurupy | On 9 December 2008 the City Registration Department registered O.’s title to the flat. | On 2 March 2010 S. sold the flat to the first applicant. | 19 December 2014 | On 9 October 2015 the Moscow City Court upheld the judgment of 23 December 2014 on appeal.
On 22 January 2016 the City Court refused to grant the applicants leave to bring a cassation appeal. |
| 3. | 39274/16 | 15-3-158 Ulitsa Tsyurupy | On 25 May 2009 the City Registration Department registered the sale agreement and Kuz.’s title to the flat. | On 16 November 2010 Kuz. sold the flat to the first applicant. | 4 February 2015 | On 22 September 2014 the City Court rejected the applicants’ appeal.
On 18 March 2015 the City Court rejected the applicants’ cassation appeal. On 7 May 2015 the Supreme Court rejected the applicants’ second cassation appeal. |
APPENDIX III
Awards made by the Court under Article 41 of the Convention
| No. | Application number and name of the applicant who receives the award | Non-pecuniary damage | Costs and expenses |
| 1 | 4919/16
MsT. Titova |
EUR 5,000 | EUR 1,000 |
| 2 | 16430/16
Mr M. Andriyakhin |
EUR 5,000 | EUR 1,000 |
| 3 | 39274/16
Ms O.Demina |
EUR 5,000 | EUR 1,000 |
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