\nCASE OF KOV\u00c1CS v. HUNGARY<\/strong>
\n(Application no. 25294\/15)<\/em>
\nJUDGMENT
\nSTRASBOURG
\n7 October 2021<\/p>\n
This judgment is final but it may be subject to editorial revision.<\/p>\n
In the case of Kov\u00e1cs v. Hungary,<\/strong><\/p>\n The European Court of Human Rights (First Section), sitting as a Committee composed of:<\/p>\n Alena Pol\u00e1\u010dkov\u00e1, President, Having regard to:<\/p>\n the application (no.\u00a025294\/15) against Hungary lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (\u201cthe Convention\u201d) by a Hungarian national, Ms\u00a0Endr\u00e9n\u00e9 Kov\u00e1cs (\u201cthe applicant\u201d), on 13 March 2013;<\/p>\n the decision to give notice of the application to the Hungarian Government (\u201cthe Government\u201d);<\/p>\n the parties\u2019 observations;<\/p>\n Having deliberated in private on 14 September 2021,<\/p>\n Delivers the following judgment, which was adopted on that date:<\/p>\n 1. The application concerns a substantial reduction of the applicant\u2019s disability benefit.<\/p>\n THE FACTS<\/strong><\/p>\n 2. The applicant was born in 1958 and lives in Szeged. She was represented by Mr D.A. Karsai, a lawyer practising in Budapest.<\/p>\n 3. The Government were represented by their Agent, Mr Z. Tall\u00f3di, of the Ministry of Justice.<\/p>\n 4. The facts of the case, as submitted by the parties, may be summarised as follows.<\/p>\n 5. The applicant was continuously entitled to various disability benefits from 2005 onwards. On 1 January 2012 she was in receipt of a rehabilitation allowance (rehabilit\u00e1ci\u00f3s j\u00e1rad\u00e9k), in application of section 10(1)-(2) of Act no.\u00a0LXXXIV of 2007. Its monthly amount was 165,515 Hungarian forints (HUF) (approximately 550 euros (EUR)). Under the law as it stood then, this benefit was available for a maximum of three years which in the applicant\u2019s case expired in July 2012.<\/p>\n 6. The applicant filed an application for a benefit for persons with reduced work capacity, which request was determined under Act no. CXCI of 2011 (in force as of 1 January 2012 – \u201cthe Reduced Work Capacity Act\u201d). In the ensuing procedure, the applicant\u2019s health status was medically assessed at 47% with no recommendation of rehabilitation. As of 1 August 2012, disability allowance (rokkants\u00e1gi ell\u00e1t\u00e1s) in the monthly amount of HUF\u00a055,800 (EUR 190) was put in place, in application of the then relevant calculation rules.<\/p>\n 7. In pursuit of intervening amendments to the Reduced Work Capacity Act, the applicant\u2019s monthly allowance was increased, as of 1 January 2014, to HUF 159,100 (EUR 530). This benefit appears to have been in place ever since.<\/p>\n THE LAW<\/strong><\/p>\n I. ALLEGED VIOLATION OF ARTICLE 1 of PROTOCOL NO. 1 TO THE CONVENTION<\/p>\n 8. The applicant complained of the substantial reduction of her benefit, in particular in the period August 2012 to January 2014. She relied on Article 1 of Protocol No. 1 and Articles\u00a06, 8, 13 and 14 of the Convention. The Court, being the master of the characterisation to be given in law to the facts of a case (see Radomilja and\u00a0Others v. Croatia [GC], nos.\u00a037685\/10 and\u00a022768\/12, \u00a7\u00a7 114 and 126, 20\u00a0March 2018), considers that this complaint falls to be examined under Article 1 of Protocol No. 1 alone, 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 A. Admissibility<\/strong><\/p>\n 9. The Government argued that the applicant had not exhausted domestic remedies because she had not pursued the case (in which the 47% score had been established, see paragraph 6 above) in court; a court action would have been adequate to challenge the medical assessment underlying the score. Moreover, the applicant\u2019s complaint is, in their view, incompatible ratione materiae with the provisions of the Convention because, once the three-year fix-term period of rehabilitation allowance had expired, the applicant had no legitimate expectation of continued payment of an allowance of comparable amount. Lastly, for the Government, the applicant had lost her victim status, because the law had remedied her situation as of 1 January 2014.<\/p>\n 10. The applicant disagreed, emphasising in particular that a court action would have been futile, since her complaint concerned the legal context rather than the medical assessment.<\/p>\n 11. The Court notes that there is no indication in the case file \u2013 or submission from any of the parties \u2013 to the effect that the applicant\u2019s health status changed in the material period. In these circumstances, it accepts the applicant\u2019s argument according to which the crux of the matter is the legal context itself, which is why a court action challenging merely the medical assessment score was not an adequate remedy. The Government\u2019s objection of domestic remedies must therefore be rejected.<\/p>\n 12. Furthermore, as regards the victim status, the Court notes that the legislative developments solved the applicant\u2019s problem only as of 1\u00a0January 2014. In these circumstances, it cannot be said that she has no victim status in regard to the period 1 August 2012 to 1 January 2014. This objection must therefore likewise be rejected.<\/p>\n 13. The Government also argued that the application was incompatible ratione materiae with the provisions of the Convention. They emphasised that the application concerned the discontinuation of a fixed-term benefit which, on its expiry, did not create any \u201cassertable right\u201d or \u201clegitimate expectation\u201d enabling the applicant to avail himself of Article 1 of Protocol No.\u00a01 in order to challenge the reduced benefit granted to the applicant in the period complained of.<\/p>\n 14. The Court considers that this objection of the Government is so closely linked to the substance of the applicant\u2019s complaint that it should be joined to the merits (compare B\u00e9l\u00e1n\u00e9 Nagy v.\u00a0Hungary [GC], no.\u00a053080\/13, \u00a7\u00a071, 13 December 2016). It further notes that the application is not inadmissible on any other grounds. It must therefore be declared admissible.<\/p>\n B. Merits<\/strong><\/p>\n 1. The parties\u2019 submissions<\/em><\/p>\n 15. As to the applicability of Article 1 of Protocol No. 1, the applicant submitted that, given that her state of health was permanently impaired, she legitimately expected to receive, continuously, an adequate benefit from the State, notwithstanding the fact that the statutory time-frame for rehabilitation was a fixed-term one.<\/p>\n 16. As to compliance with Article 1 of Protocol No. 1, the applicant was of the view that the interference she had suffered was disproportionate in that about two-thirds of her benefit had been removed for a period of nearly one and a half years, notably from 1 August 2012 until 1\u00a0January 2014.<\/p>\n 17. The Government submitted that even if Article 1 of Protocol No.\u00a01 were applicable, the applicant had not sustained any interference with her rights under that provision, since there was no basis in domestic law for her to claim the continuous payment of an unchanged benefit no matter how the circumstances evolved. Moreover, even assuming the existence of an interference, the measures applied in the applicant\u2019s case pursued the general interest of rationalising the system of disability benefits and were not disproportionate, having been in place for only a limited period in time and followed by a compensatory increase of the benefit.<\/p>\n 2. The Court\u2019s assessment<\/em><\/p>\n 18. The Court has summarised its position on the applicability of Article\u00a01 of Protocol No. 1 in cases similar to the present one in paragraphs\u00a072 to 110 of the B\u00e9l\u00e1n\u00e9 Nagy judgment (cited above). It sees no reason to depart from those considerations.<\/p>\n 19. In particular, the Court reiterates that, in the field of social-security benefits, \u201cfor the recognition of a possession consisting in a legitimate expectation, the applicant must have an assertable right which … may not fall short of a sufficiently established, substantive proprietary interest under the national law\u201d (see B\u00e9l\u00e1n\u00e9 Nagy, cited above, \u00a7 79).<\/p>\n 20. It transpires from the facts of the present application that, since 2005, the applicant has been continuously entitled, under one legal regime or another, to receive disability benefits from the State. It has not been argued that her health status changed significantly during that time. For the Court, these elements gain particular significance when dealing with the Government\u2019s argument pointing to the fixed-term character of the rehabilitation allowance.<\/p>\n 21. The Court is therefore satisfied that the applicant\u2019s claim for disability benefit during the seventeen-month period in issue (from 1\u00a0August 2012 until 1 January 2014) constituted a \u201csufficiently established, substantive proprietary interest under the national law\u201d, just as it had in the preceding or subsequent periods. This holds true irrespective of whether the benefit in a given period was granted for a definite or an indefinite duration, since the underlying medical condition remained constant.<\/p>\n 22. It follows that Article 1 of Protocol No. 1 is applicable and the Government\u2019s preliminary objection of incompatibility ratione materiae must be dismissed (see Bacz\u00far v. Hungary, no. 8263\/15, \u00a7 25, 7\u00a0March 2017).<\/p>\n 23. Moreover, the Court cannot but emphasise that, as of 1\u00a0August 2012, the applicant\u2019s benefit had been reduced to approximately one-third of its previous value \u2013 a situation which lasted seventeen months. It must therefore be concluded that her right to receive social-security benefits on account of her ailments was interfered with. It remains to be ascertained whether the interference was justified.<\/p>\n 24. A synopsis of the Court\u2019s position on compliance with Article 1 of Protocol No. 1 in this field can be found in paragraphs 112 to 118 of the B\u00e9l\u00e1n\u00e9 Nagy judgment (cited above). Those considerations are also valid in the present case.<\/p>\n 25. The Court notes at the outset that the measure complained of had undisputedly a basis in national law; and it accepts that it corresponded to the general interest attached to the rationalisation of the social-security system. At this juncture, the Court reiterates that \u201cthe fact that a person has entered into and forms part of a State social-security system (even if a compulsory one, as in the instant case) does not necessarily mean that that system cannot be changed, either as to the conditions of eligibility of payment or as to the quantum of the benefit or pension (see, mutatis mutandis, Carson and Others v. the United Kingdom [GC], no.\u00a042184\/05, \u00a7\u00a7\u00a085-89, ECHR 2010, and Richardson v. the United Kingdom (dec.), no.\u00a026252\/08, \u00a7 17, 10 April 2012). Indeed, the Court has accepted the possibility of amendments to social-security legislation which may be adopted in response to societal changes and evolving views on the categories of persons who need social assistance, and also to the evolution of individual situations (see Wieczorek v. Poland, no. 18176\/05, \u00a7\u00a067, 8\u00a0December 2009, and B\u00e9l\u00e1n\u00e9 Nagy, cited above, \u00a7 88). The Court would stress that, in present-day conditions, these considerations play a primordial role in assessing complaints going to the impairment of social welfare rights; and they undoubtedly provide the State with a wide margin of appreciation in rationalising their social-security systems. Nevertheless, the examination of proportionality of such measures cannot be dispensed with.<\/p>\n 26. In addressing the proportionality of the measure, that is, in considering whether the interference imposed an excessive individual burden on the applicant, the Court will have regard to the particular context in which the issue arose, namely that of a social-security scheme. Such schemes are an expression of a society\u2019s solidarity with its vulnerable members (see B\u00e9l\u00e1n\u00e9 Nagy, cited above, \u00a7 116). An important consideration is whether the applicant\u2019s right to derive benefits from the social-insurance scheme in question has been infringed in a manner resulting in the impairment of the essence of her pension rights (see B\u00e9l\u00e1n\u00e9 Nagy, cited above, \u00a7 118).<\/p>\n For the Court, a two-thirds reduction, as in the present case, falls into this latter category.<\/p>\n 27. The Court notes that although the applicant \u2013 unlike Mrs Nagy \u2013 was not completely deprived of all entitlements, her income was nevertheless abruptly reduced to EUR 190 per month. This element is aggravated by the fact that the applicant apparently had no other significant income on which to subsist and that she belonged to a vulnerable group of disabled persons (see B\u00e9l\u00e1n\u00e9 Nagy, cited above, \u00a7\u00a0123).<\/p>\n 28. The Court thus considers that in the present case the application of the impugned legislation resulted in a situation in which a fair balance was not struck between the interests at stake \u2013 even if that legislation was aimed at protecting the public purse by rationalising the scheme of disability benefits, a matter of legitimate general interest in whose pursuit the State enjoys a wide margin of appreciation. Once again, it must be stressed that the applicant suffered the removal of two-thirds of her benefit, whereas there was no indication that she had failed to act in good faith at all times, to co-operate with the authorities or to make any relevant claims or representations (see B\u00e9l\u00e1n\u00e9 Nagy, cited above, \u00a7\u00a7\u00a0121, 125 and 126).<\/p>\n 29. The Court thus considers that there was no reasonable relation of proportionality between the aim pursued and the restrictions applied to the applicant\u2019s allowance in the period from 1\u00a0August 2012 to 1\u00a0January 2014. It therefore finds that, notwithstanding the State\u2019s wide margin of appreciation in this field, the applicant had to bear, in the period at issue, an excessive individual burden (see Bacz\u00far, cited above, \u00a7\u00a7 27-32). Even though the applicant later benefitted from a further legislative amendment, which resulted in an increase of her disability allowance, that measure only applied from 1 January 2014 onwards.<\/p>\n 30. It follows that there has been a violation of her rights under Article\u00a01 of Protocol No.\u00a01.<\/p>\n II. APPLICATION OF ARTICLE\u00a041 OF THE CONVENTION<\/p>\n 31. Article\u00a041 of the Convention provides:<\/p>\n \u201cIf 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.\u201d<\/p>\n 32. The applicant claimed EUR 6,700 in respect of pecuniary damage (17 months of accrued loss in the monthly allowance in the material period), EUR\u00a010,000 in respect of non-pecuniary damage and EUR\u00a012,192 in respect of costs and expenses incurred before the Court.<\/p>\n 33. The Government contested these claims.<\/p>\n 34. The Court cannot speculate on the amount of disability benefit which would have been disbursed to the applicant had the violation not occurred. It therefore awards her a lump sum of EUR 5,000 in respect of the pecuniary damage sustained (see B\u00e9l\u00e1n\u00e9 Nagy, cited above, \u00a7 131). Moreover, it considers that she must have suffered some non-pecuniary damage on account of the distress suffered and awards her, on the basis of equity, EUR\u00a05,000 under this head. Lastly, according to the Court\u2019s case-law, an applicant is entitled to the reimbursement of costs and expenses only in so far as it has been shown that these have been actually and necessarily incurred and are reasonable as to quantum. In the present case, regard being had to the documents in its possession and the above criteria, the Court considers it reasonable to award the sum of EUR 3,000 covering costs under all heads.<\/p>\n
\nP\u00e9ter Paczolay,
\nGilberto Felici, judges,
\nand Liv Tigerstedt, Deputy Section Registrar,<\/p>\n![\"INTRODUCTION\"](\"https:\/\/laweuro.com\/wp-content\/uploads\/2021\/10\/INTRODUCTION.jpg\")
<\/p>\n