FIRST SECTION
\nDECISION
\nApplication no. 67998\/13
\nMila BULI\u0106 and Dragica BULI\u0106
\nagainst Croatia<\/p>\n
The European Court of Human Rights (First Section), sitting on 3 March 2020 as a Committee composed of:<\/p>\n
Krzysztof Wojtyczek, President,
\nArmen Harutyunyan,
\nPere Pastor Vilanova, judges,
\nand Renata Degener, Deputy Section Registrar,<\/p>\n
Having regard to the above application lodged on 21 October 2013,<\/p>\n
Having regard to the observations submitted by the respondent Government and the observations in reply submitted by the applicant,<\/p>\n
Having deliberated, decides as follows:<\/p>\n
THE FACTS<\/strong><\/p>\n 1. The applicants, Ms Mila Buli\u0107 (\u201cthe first applicant\u201d) and Ms Dragica Buli\u0107 (\u201cthe second applicant\u201d) are Croatian nationals who were born in 1972 and 1952 respectively and live in Metkovi\u0107. They were represented before the Court by Mr\u00a0S.\u00a0Cvitanovi\u0107, a lawyer practising in Metkovi\u0107.<\/p>\n 2. The Croatian Government (\u201cthe Government\u201d) were represented by their Agent, Ms \u0160. Sta\u017enik.<\/p>\n I. The circumstances of the case<\/p>\n 3. The facts of the case, as submitted by the parties, may be summarised as follows.<\/p>\n A. Background of the case<\/strong><\/p>\n 4. In a decision of 8 September 1970 the first applicant\u2019s father and the second applicant\u2019s husband, I.B. (hereinafter \u201cthe applicants\u2019 predecessor\u201d) was awarded a flat in Metkovi\u0107 with a surface area of 57.44 square metres by his employer, a socially-owned company, PIK Neretva. The decision referred to the applicants\u2019 predecessor as the holder of the specially protected tenancy, and indicated that he had to conclude a contract for use of the flat (ugovor o kori\u0161tenju stana) with the company\u2019s unit in charge of its housing fund. There is no evidence that he ever concluded such a contract.<\/p>\n 5. On 1 May 1991 the Transformation of Socially-Owned Companies Act entered into force. It provided that all socially-owned companies had to transform into commercial companies, in particular into either limited\u2011liability companies or joint-stock companies. The companies were allowed to include the flats they managed in their share capital. The companies which had done so had thereby became the owners of those flats. The companies that did not include such flats in their share capital had to transfer their management rights in respect of those flats to municipal housing and communal funds, which became providers of those flats within the meaning of relevant legislation.<\/p>\n 6. On 19 June 1991 the Specially Protected Tenancies (Sale to Occupier) Act (hereinafter \u201cthe Sale to Occupier Act\u201d) entered into force. It entitled holders of specially protected tenancies of flats in social and State ownership to purchase them from the providers of such flats under favourable conditions.<\/p>\n 7. On 22 February 1993 the applicants\u2019 predecessor submitted a request to purchase the flat in question to the Housing and Communal Fund of the Municipality of Metkovi\u0107 (Fond u stambenom i komunalnom gospodarstvu Op\u0107ine Metkovi\u0107). He relied on the Sale to Occupier Act.<\/p>\n 8. By a letter of 3 March 1993 the said housing fund informed the applicants\u2019 predecessor that it could not sell him the flat he occupied because it belonged to the public water-management company Neretvanski Sliv and because it was located in a commercial building (see paragraph 28 below).<\/p>\n 1. Civil proceedings for the purchase of the flat and surrounding circumstances<\/em><\/p>\n 9. On 1 June 1994 the applicants\u2019 predecessor brought a civil action in the Metkovi\u0107 Municipal Court (Op\u0107inski sud u Metkovi\u0107u) with a view to obtaining a judgment in lieu of the sale contract. Initially, he directed his action against the above mentioned housing and communal fund but subsequently, once such funds had been abolished, he named the Municipality of Metkovi\u0107 (which later on became the Metkovi\u0107 Township (Grad Metkovi\u0107 \u2013 hereinafter \u201cthe local authorities\u201d)) as the defendant instead.<\/p>\n 10. On 23 February 1995 the company Neretvanski Slivjoined the proceedings as an intervener on the side of the defendant, claiming that the building in which the flat was located belonged to it. Following the changes in water-management legislation that company was on 12\u00a0August 1998 superseded as the intervener by the national public water-management company Hrvatske Vode.<\/p>\n 11. Throughout the proceedings the defendant and the intervener(s) argued that the building in which the flat was located was owned by the intervener(s) and that thus the defendant was not entitled to sell the flat and, consequently, that the defendant had no standing to be sued. In addition, the defendant and the intervener(s) also claimed that the flat was located in a commercial building and thus was not susceptible to sale (see paragraph 8 above and paragraph 28 below). Lastly, the defendant and the intervener(s) argued that the applicants\u2019 predecessor could not have acquired the specially protected tenancy. In the defendant\u2019s opinion that was so because the premises he occupied with his family were business premises rather than a flat. In the opinion of the successive interveners those premises had been allocated to him in 1970 as basic (nu\u017eni smje\u0161taj) or temporary accommodation (privremeni smje\u0161taj) in respect of which a specially protected tenancy could not have been awarded under the legislation then in force.<\/p>\n 12. During the proceedings the applicants\u2019 predecessor argued that the flat at issue belonged to the company PIK Neretva and subsequently to its legal successors, first the company Neretva Poljoprivreda and then to the company Neretva. During the transformation from a socially-owned company into a commercial company (see paragraph 5 above) in 1995, the Neretva company had not included the flat in its share capital. This meant that under the relevant legislation (see paragraph 5 above) the flat had been transferred to the Housing and Communal Fund of the Municipality of Metkovi\u0107 which, as the provider of the flat, was bound to sell it to him pursuant to the Sale to Occupier Act (see paragraph 29 below).<\/p>\n 13. While the proceedings instituted by the applicants\u2019 predecessor were pending, the company Hrvatske Vode brought a civil action before the same municipal court against the local authorities with a view to being declared the owner of the building in which the flat was located. The defendant did not contest the claim and a judgment to that effect was adopted on 20\u00a0December 1999. On the basis of that judgment Hrvatske Vode was later on registered as the owner of the building in the land register.<\/p>\n 14. In the proceedings instituted by the applicants\u2019 predecessor, the Metkovi\u0107 Municipal Court four times adopted judgments in his favour. However, each time those judgments were quashed by the Dubrovnik County Court (\u017dupanijski sud u Dubrovniku) following appeals lodged by the defendant and the intervener Hrvatske Vode, and the case was remitted for a fresh examination.<\/p>\n 15. Eventually, by a judgment of 28August 2012 the Municipal Court dismissed the applicants\u2019 predecessor\u2019s action finding that the local authorities did not have standing to be sued. On 12\u00a0December 2012 the Dubrovnik County Court dismissed an appeal by the applicants\u2019 predecessor and upheld the first-instance judgment.<\/p>\n 16. Specifically, the Municipal Court and the County Court established that:<\/p>\n – the flat in question was indeed located in a commercial building constructed in 1959 by a local water-management company as a storehouse for spare equipment for flood management;<\/p>\n – the building had been used by that company in the 1960s;<\/p>\n – sometime at the end of the 1960s the building had been taken over by PIK Neretva and had belonged to the company at the time the flat had been awarded to the plaintiff;<\/p>\n – over time the character of the building had changed and by the time the flat had been allocated to the plaintiff the building had already been in residential use;<\/p>\n – the premises awarded to the plaintiff constituted a flat and not business premises or basic or temporary accommodation (see paragraph 11 above);<\/p>\n – in 1985 PIK Neretva company had split into two companies which had divided the former company\u2019s assets so that company Neretva Poljoprivreda had taken over the part of the building where the flat was located whereas company Neretva Gra\u0111evinarstvo had taken over the part of the building consisting of the storage space;<\/p>\n – during NeretvaPoljoprivreda\u2019s transformation from a socially-owned company into a commercial company Neretva d.d. on 17\u00a0March 1995, the flat had not been included in its share capital (see paragraphs 5 and 12 above);<\/p>\n – on 10 September 1999 bankruptcy proceedings had been opened against the company Neretva d.d.[1]<\/p>\n 17. However, the Municipal Court also held that the applicants\u2019 predecessor had not proved that at the time he had submitted his purchase request (see paragraph 7 above) the flat had still belonged to Neretva company, as PIK Neretva\u2019s legal successor. The court could thus not accept his argument that, if the flat had not been included in the company\u2019s share capital during transformation, it had to be considered to have been transferred to the Housing and Communal Fund of the Municipality of Metkovi\u0107 (see paragraph 12 above). Rather, the court reasoned that the absence of a decision including the flat in the company\u2019s share capital or a decision transferring it to the said housing fund, suggested that at the time of the company\u2019s transformation the flat had no longer belonged to the company.<\/p>\n 18. By a decision of 6 June 2013 the Constitutional Court (Ustavni sud Republike Hrvatske) dismissed the constitutional complaint by the applicants\u2019 predecessor and served its decision on his representative on 8\u00a0July 2013.<\/p>\n 19. On 9 August 2013 the applicants\u2019 predecessor died. The decision of 12 November 2013 issued by a notary public in Metkovi\u0107 listed various items of property (including the alleged ownership of the flat in question) as the estate of the deceased, and identified his wife (the second applicant) as well as his son and two daughters (including the first applicant) as his statutory heirs. The decision also stated that all the children of the deceased had renounced their share in the estate in favour of their mother, the second applicant. Consequently, the second applicant was declared her husband\u2019s sole heir by the said decision.<\/p>\n 2. Other relevant proceedings<\/em><\/p>\n 20. Meanwhile, on 31 January 2013 the applicants\u2019 predecessor brought a civil action in the Metkovi\u0107 Municipal Court against the national public water-management company Hrvatske Vode, seeking a declaration of his ownership of the flat in question and registration in his name in the land register. He submitted that the courts\u2019 findings in the above civil proceedings for the purchase of the flat (see paragraphs 9-18) suggested that PIK Neretva had not been entitled to award him the flat in 1970. This however, at the same time, meant that he had been in exclusive and uninterrupted possession of the flat since 1970 and thereby had become its owner because the statutory period for acquiring ownership by adverse possession had elapsed.<\/p>\n 21. On 20 May 2013 the defendant submitted a counterclaim, seeking the applicants\u2019 and their predecessor\u2019s eviction from the flat at issue. It argued that they occupied the flat without a title and that the applicants\u2019 predecessor could not have become the owner of the flat because he had not possessed it in good faith.<\/p>\n 22. On 18 September 2015 the applicants\u2019 predecessor\u2019s representative informed the court that the plaintiff had died (see paragraph 19 above) and asked it to stay the proceedings until his heirs could take over.<\/p>\n 23. By a decision of 28 September 2015 the Municipal Court stayed the proceedings.<\/p>\n 24. On 13 January 2017 the defendant suggested that the court invite the plaintiff\u2019s heirs to take over the proceedings. On 19 August 2019 the court did so whereupon on 29 August 2019 the second applicant took over the proceedings in her husband\u2019s stead. The proceedings are still pending.<\/p>\n B. Relevant domestic law<\/strong><\/p>\n 1. Housing legislation<\/em><\/p>\n 25. Successive Housing Acts of 1962, 1974 and 1985 each provided that when a person acquired a specially protected tenancy of a flat, his or her spouse ex lege became a co-holder of that tenancy.<\/p>\n 26. Other relevant provisions of that and other legislation regarding valid acquisition of a specially protected tenancy, as well as related case-law of the domestic courts, are summarised in Petolas v. Croatia ((dec.), no.\u00a074936\/12, \u00a7\u00a7 40-43 and 46, 22 March 2016).<\/p>\n 2. Specially Protected Tenancies (Sale to Occupier) Act<\/em><\/p>\n 27. The Specially Protected Tenancies (Sale to Occupier) Act (Zakon o prodaji stanova na kojima postoji stanarsko pravo, Official Gazette no.\u00a027\/91 with subsequent amendments), which entered into force on\u00a019\u00a0June 1991, entitled holders of specially protected tenancies of flats in social or State ownership to purchase the flats in respect of which they held such tenancy under favourable conditions.<\/p>\n 28. Section 3 of the Sale to Occupier Act provided that the Act did not apply, inter alia, to flats (a) located in structures or in areas under special protection of the State, the sale of which was prohibited by special legislation; and (b) located in commercial buildings used for the purposes of State administration, healthcare, education, culture, energy production, transport and communications and in structures of State interest. Section\u00a08 provided that if the flat was located in a commercial building, the provider of the flat had to offer the tenant by 30 June 2003 another empty flat to buy. Upon the expiry of that time-limit the tenant had the right to purchase the flat of which he or she held a specially protected tenancy regardless of whether the flat was located in a commercial building.<\/p>\n 29. Section 4(1) provided that every holder of a specially protected tenancy (the tenant) could make a written request for purchase of the flat to the seller, who had to sell it to the tenant. The seller was either (a) the entity with the right of disposal of the flat, or (b) its owner which acquired the ownership of the flat in the process of transformation of socially-owned property (for example, the company which became the owner of the flat by including it in its share capital during the transformation from socially\u2011owned company into a commercial company, see paragraph\u00a05 above).<\/p>\n 30. Section 5 provided that the local authorities (municipalities and townships) were selling their own flats and those transferred to their housing and communal funds (see paragraph 5 above) as well as those flats the seller of which was unknown.<\/p>\n 31. Section 6(2) provided that when the spouses were co-holders of the specially protected tenancy (see paragraph 25 above) they could buy the flat either jointly or so that one of them buys it with the consent of the other.<\/p>\n COMPLAINT<\/strong><\/p>\n 32. The applicants complained under Article 1 of Protocol No. 1 to the Convention of the domestic courts\u2019 dismissal of their predecessor\u2019s claim for purchase of the flat awarded to him by his employer in 1970 (see\u00a0paragraph 4 above).<\/p>\n THE LAW<\/strong><\/p>\n 33. The applicants complained that the domestic courts\u2019 refusal to grant their predecessor\u2019s claim for purchase of the flat, in which they had been living since it had been allocated to him in 1970, had been in breach of their right to the peaceful enjoyment of their possessions. They relied on Article\u00a01 of Protocol No. 1 to the Convention, which reads as follows:<\/p>\n \u201cEvery 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.<\/p>\n 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.\u201d<\/p>\n 34. The Government disputed the admissibility of this complaint on three grounds. They argued that the applicants had failed to exhaust properly domestic remedies, that the complaint was incompatible ratione temporis with the provisions of the Convention and that it was, in any event, manifestly ill-founded.<\/p>\n 35. The Court does not find it necessary to examine all the inadmissibility objections raised by the Government or to reproduce all the parties\u2019 arguments related thereto, as the present complaint in any event inadmissible for the following reasons.<\/p>\n A. As regards the first applicant<\/strong><\/p>\n 36. The Government did not explicitly raise an objection concerning the first applicant\u2019s victim status. However, they did argue that the applicants\u2019 complaint was manifestly ill-founded as regards the first applicant because, inter alia, she was not her father\u2019s heir given that she had renounced her share in the estate in favour of her mother, the second applicant (see\u00a0paragraph 19 above). The applicants did not comment on this issue.<\/p>\n 37. The Court reiterates that the issue of whether an applicant can claim to be a victim of the violation complained of is a matter which goes to the Court\u2019s jurisdiction, and which the Court must thus examine of its own motion (see Buzadji v. the Republic of Moldova [GC], no. 23755\/07, \u00a7\u00a070, ECHR 2016 (extracts)).<\/p>\n 38. The Court notes that in a decision of 12 November 2013 issued by a notary public following the death in August 2013 of I.B., who was the first applicant\u2019s father and the second applicant\u2019s husband, the second applicant was declared his sole heir (see paragraph 19 above). This means that the first applicant cannot claim to be a victim of the alleged violation of Article\u00a01 of Protocol No. 1 to the Convention.<\/p>\n 39. It follows that this complaint, in so far as it concerns the first applicant, is inadmissible for lack of victim status and must be rejected pursuant to Article 34 and Article 35 \u00a7\u00a7 3 (a) and 4 of the Convention.<\/p>\n B. As regards the second applicant<\/strong><\/p>\n 1. The parties\u2019 arguments<\/em><\/p>\n 40. The Government submitted that neither the applicants nor their predecessor had ever brought a civil action against a legal entity which was entitled to sell the flat in question. In this connection they pointed out that the reason why the domestic courts had dismissed the civil action by the applicants\u2019 predecessor in the civil proceedings complained of was the finding by those courts that the local authorities were not the legal entity from which he had been entitled to seek the sale of the said flat (see\u00a0paragraph 17 above).<\/p>\n 41. Had the applicants or their predecessor sued the correct defendant, that would have afforded the domestic courts an opportunity to address all relevant legal issues related to their legal status under domestic law in respect of the disputed flat, notably, whether the applicants\u2019 predecessor had had a specially protected tenancy of the flat and, if so, whether he had had the right to purchase it. Owing to that omission on the part of the applicants and their predecessor, the domestic courts never had a chance to address those issues which were relevant for examining the admissibility and merits of the applicants\u2019 complaint before the Court.<\/p>\n 42. The applicants contested the Government\u2019s argument that they had sued the wrong defendant. In their view the domestic courts\u2019 finding that the local authorities were not the legal entity from which their predecessor could have sought the sale of the flat in question was wrong as being illogical and had resulted in breach of his and their right to the peaceful enjoyment of their possessions.<\/p>\n 2. The Court\u2019s assessment<\/em><\/p>\n 43. The Court reiterates that an applicant may allege a violation of Article 1 of Protocol No. 1 only in so far as the impugned decisions relate to his or her \u201cpossessions\u201d within the meaning of that provision. \u201cPossessions\u201d can be \u201cexisting possessions\u201d or claims that are sufficiently established to be regarded as \u201cassets\u201d (see, for example, Radomilja and Others v. Croatia [GC], nos. 37685\/10 and 22768\/12, \u00a7 142, 20 March 2018).<\/p>\n 44. Having regard to its case-law (see Ga\u0107e\u0161a v. Croatia (dec.), no.\u00a043389\/02, 1 April 2008, and Trifunovi\u0107 v. Croatia (dec.), no.\u00a034162\/06, 6\u00a0November 2008), the Court considers that the applicants\u2019 predecessor\u2019s and the second applicant\u2019s right to purchase the flat was a \u2018claim\u2019 rather than an \u2018existing possession\u2019.<\/p>\n 45. Where a proprietary interest is in the nature of a claim, it may be regarded as an \u201casset\u201d only if there is a sufficient basis for that interest in national law, that is to say when the claim is sufficiently established as to be enforceable (see, for example, Radomilja and Others, cited above, \u00a7 142). The Court further reiterates that, in principle, it cannot be said that an applicant has a sufficiently established claim amounting to an \u201casset\u201d for the purposes of Article 1 of Protocol No. 1, where the question of whether or not he or she complied with the statutory requirements is to be determined in judicial proceedings (see, for example, Radomilja and Others, cited above, \u00a7 149).<\/p>\n 46. In this connection the Court notes that, under the relevant domestic legislation, socially-owned flats could be sold to their occupants only if they were holders of a specially protected tenancy of the flat they occupied (see\u00a0paragraph 29 above). Whether this most important statutory requirement for buying the flat was satisfied in the present case was highly disputed and extensively debated in the proceedings complained of (see\u00a0paragraphs 11-12 and 15-16 above). The Court notes however that the domestic courts eventually dismissed the applicants\u2019 predecessor\u2019s claim for the purchase of the flat in question on the grounds that the local authorities did not have standing to be sued given that they were not the legal entity from which he could have sought the sale of the flat. This reasoning and the other findings in those proceedings suggest that the issue of whether the applicants\u2019 predecessor (and the second applicant as his wife, see\u00a0paragraph\u00a025 above) had had a specially protected tenancy of the said flat and whether the other statutory requirements for buying the flat were satisfied, remained open.<\/p>\n 47. Those findings therefore do not provide enough elements for the Court to assess whether the applicants\u2019 predecessor\u2019s claim for the purchase of the flat had a sufficient basis in national law. Given that the second applicant has a chance to institute civil proceedings for the purchase of the flat against the company which is the registered owner of the building where the flat is located (see paragraph 13 above), the issue of whether the relevant statutory requirements for purchasing the flat were satisfied could be resolved with binding effect in such a case. The Court therefore considers that it would be premature to take a position on the applicability of Article\u00a01 of Protocol No.\u00a01 to the Convention to the present case or on the substance of the complaint under that Article (see, for example, Gurduli\u0107 and Others v. Croatia (dec.), no. 5076\/09, \u00a7\u00a7 76-77, 8 April 2014).<\/p>\n 48. It follows that this complaint, to the extent that it concerns the second applicant, is inadmissible as premature and must be rejected pursuant to Article 35 \u00a7 4 of the Convention.<\/p>\n For these reasons, the Court, unanimously,<\/p>\n Declares the application inadmissible.<\/p>\n Done in English and notified in writing on 26 March 2020.<\/p>\n Renata Degener \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 Krzysztof Wojtyczek ______________<\/p>\n [1]. The company was eventually struck off from the register of commercial companies on 17\u00a0April 2012.<\/p>\n
\nDeputy Registrar \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 President<\/p>\n