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LIBERALISM, SOCIAL DEMOCRACY AND THE VALUE OF PROPERTY UNDER THE EUROPEAN CONVENTION ON HUMAN RIGHTS

Published online by Cambridge University Press:  11 November 2010

Tom Allen
Affiliation:
Professor of Law, University of Durham. Email: Thomas.Allen@durham.ac.uk.

Extract

In most of Europe, expropriation must comply with the standards set under European human rights law. Article 1 of the First Protocol (‘P1-1’) to the European Convention on Human Rights declares that ‘every natural or legal person is entitled to the peaceful enjoyment of his possessions.’ The European Court of Human Rights has stated that the right would be ‘largely illusory and ineffective’ if it did not guarantee full compensation in all but exceptional circumstances.1 It is quite clear, however, that this was not the belief of at least some of the States that had signed it when it came into force in 1954. P1-1 makes no reference to compensation. An interference must be lawful, and in the public or general interest, but there is nothing that expressly requires compensation. Nevertheless, the Court has declared that any interference with the right to the peaceful enjoyment of possessions must strike a ‘‘fair balance’ between the demands of the general interest of the community and the requirements of the protection of the individual's fundamental rights’,2 and this means that expropriation without compensation that is reasonably related to the value of the property would normally violate the owner's rights under P1-1.3

Type
Shorter Articles
Copyright
Copyright © 2010 British Institute of International and Comparative Law

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References

1 James v United Kingdom (App No 8793/79) (1986) Series A No 98 [54]; Lithgow v United Kingdom (App No 9006/80; 9262/81; 9263/81; 9265/81; 9266/81; 9313/81; 9405/81) (1986) Series A No 102 [120].

2 Sporrong and Lönnroth v Sweden (App No 7151/75; 7152/75) (1982) Series A No 52 [69].

3 James (n 1) [36]; Lithgow (n 1) [50]–[51].

4 Sporrong (n 2).

5 Lithgow (n 1).

6 James (n 1).

7 For a modern expression of liberal property theory, see RA Epstein, Takings: Private Property and the Power of Eminent Domain (Harvard University Press, Cambridge, USA 1985); cf Grey, TCThe Malthusian Constitution’ (1986) 41 U Miami LR 21.Google Scholar

8 Arguably, subjective values should be taken into account as well: see Allen, T, ‘Compensation for Property under the European Convention on Human Rights’ (2007) 28 Michigan JIL 287Google Scholar.

9 The balance need not be struck by the judicial branch: in other words, a constitution may frame a property right in terms that leave the judiciary with no clear power to balance interests. Nevertheless, the balance has still been struck, but by the drafters of the constitution.

10 Rose, CM, ‘Privatization—The Road to Democracy?’ (2006) 50 Saint Louis Uni LJ 691Google Scholar, 700–701.

11 485 US 1, 22–23 (1988).

12 ibid.

13 Council of Europe, Collected edition of the ‘travaux préparatoires’ of the European Convention on Human Rights: Recueil des travaux préparatoires de la Convention européenne des droits de l'homme (M Nijhoff, The Hague, 1975–1985) vol 2, 52.

14 ibid 54–56; see also 80 (Elmgren, Sweden).

15 Art 3 also declares that states that subsequently wished to join the Council of Europe would be expected to accept ‘the principles of the rule of law and of the enjoyment by all persons within its jurisdiction of human rights and fundamental freedoms’.

16 S Berman, The Primacy of Politics: Social Democracy and the Making of Europe's Twentieth Century (CUP, New York, 2006); J Callaghan, The Retreat of Social Democracy (Manchester University Press, Manchester, 2000) 1–25.

17 W Blackstone, Commentaries on the Laws of England 1 (Oxford, Clarendon Press, 1765) 135.

18 Michelman, FIProperty, Utility, and Fairness: Comments on the Ethical Foundations of ‘Just Compensation’ Law' (1967) 80 Harvard LR 1165CrossRefGoogle Scholar; Blume, L and Rubinfeld, DCompensation for Takings: An Economic Analysis’ (1984) 72 Calif LR 569CrossRefGoogle Scholar.

19 Crompton, G ‘‘A very poor bag of assets’: the railway compensation issue 1921–47’ (1996) 6 Accounting, Business and Financial History 73CrossRefGoogle Scholar. On the development of economic and nationalization policies in post-War Britain, see Jones, TLabour Revisionism and Public Ownership, 1951–63’ (1991) 5 Contemporary British History 432Google Scholar; Brooke, SRevisionists and Fundamentalists: The Labour Party and Economic Policy during the Second World War’ (1989) 32 The Historical Journal 157CrossRefGoogle Scholar.

20 See Crompton ibid 87.

21 See Tichelar, MThe Conflict over Property Rights in the Second World War: The Labour Party's Abandonment of Land Nationalization’ (2003) 14 Twentieth Century British History 165CrossRefGoogle Scholar ; AW Cox, Adversary Politics and Land: The Conflict over Land and Property Rights in Post-war Britain (Cambridge, 1984) 40–50.

22 Cox ibid 27–28.

23 Uthwatt Committee on Compensation and Betterment, Final Report (Cmd 6386, 1942).

24 For a contemporary analysis, see Robinson, A, ‘The Scott and Uthwatt Reports on Land Utilisation’ (1943) 53 The Economic Journal 28, 34CrossRefGoogle Scholar. Fogg, AS, ‘Development Value and the Law: The United Kingdom and Australian Experience’ (1978) 27 ICLQ 794CrossRefGoogle Scholar, 798 compares it to a lottery, as the aggregate amount paid for tickets can far exceed the prize money.

25 Clark, KC, ‘The British Labor Government's Town and Country Planning Act: A Study in Conflicting Liberalisms’ (1951) 66 Political Science Quarterly 87CrossRefGoogle Scholar; M Grant, ‘Compensation and Betterment’ in B Cullingworth (ed), British Planning: 50 Years of Planning and Regional Policy (Athlone Press, London, 1999).

26 Waters v Welsh Development Agency [2004] UKHL 19; Spirerose Ltd v Transport for London [2009] UKHL 44; Law Commission of England and Wales, Towards a Compulsory Purchase Code: (1) Compensation (Law Com No 286, 2003) (for a review of the history, see 151–221).

27 See AWB Simpson, Human Rights and the End of Empire: Britain and the Genesis of the European Convention (Oxford, OUP 2001) ch 15.

28 Berman (n 16) 177–199.

29 Art 36.

30 Art 38.

31 Art 42; see also art 44(1) (‘For the purpose of ensuring rational utilization of land and establishing equitable social relations, the law imposes obligations on and limitations to private ownership of land, defines its limits depending on the regions and the various agricultural areas, encourages and imposes land cultivation, transformation of large estates, and the reorganization of productive units; it assists small and medium sized farms.’)

32 Art 43.

33 Judgment No 5 of 1980, as quoted in Judgment No 348 of 2007 [5.1] (the translation is from the official website, at www.cortecostituzionale.it/versioni_in_lingua/eng/attivitacorte/pronunceemassime/recent_judgments_2007.asp).

34 Pollicino, O, ‘Constitutional Court at the crossroads between constitutional parochialism and co-operative constitutionalism. Judgments No. 348 and 349 of 22 and 24 October 2007’ (2008) 4 European Constitutional LR 363Google Scholar.

35 JM Kelly, The Irish Constitution (Butterworths, London, 1994) 1061–1091.

36 Report of the Committee on the Price of Building Land (Prl. 3632, 1973) 47.

37 ibid 45; cf Kelly (n 35) 1085–86, who notes that the recommendation was not implemented.

38 The All-Party Oireachtas Committee on the Constitution, Ninth progress report: private property (Dublin: Stationery Office, 2004) 39; see also Dreher v Irish Land Commission [1984] ILRM 94; O'Callaghan v The Commissioners of Public Works (1995) ILRM 364.

39 Alexander, GSProperty as a Fundamental Constitutional Right? The German Example’ (2003) 88 Cornell LR 733Google Scholar; AJ Van der Walt, Constitutional Property Clauses: A Comparative Analysis (Cape Town, Juta, 1999) 121–63.

40 BVerfGE 24, 367, 421 (1968) (‘Hamburg Flood Control Case’), in R Youngs (trans), English, French And German Comparative Law (Routledge-Cavendish, London, 1998) 24.

41 Council of Europe (n 13) vol 6, 6–10; see also vol 6, 52ff, 130–140.

42 ibid vol 6, 48, 54 and 60.

43 ibid vol 7, 208.

44 ibid vol 7, 206–208.

45 ibid vol 7, 194.

46 ibid vol 7, 222–24, 230.

47 The reference to ‘general principles of international law’ is concerned with the customary rule requiring a State to compensate aliens for the expropriation of their property. See Fabri, HR, ‘The Approach Taken by the European Court of Human Rights to the Assessment of Compensation for ‘Regulatory Expropriations’ of the Property of Foreign Investors' (2002) 11 New York University Environmental LJ 148Google Scholar. It has been argued that P1-1 should be interpreted so as to extend the obligation to non-nationals to a State's own nationals, but the Court rejected this argument in Lithgow (n 1) [111]–[119]; Schwelb, E, ‘The Protection of the Right to Property of Nationals under the First Protocol to the European Convention on Human Rights’ (1964) 13 American J Comparative L 518CrossRefGoogle Scholar.

48 Emphasis added.

49 Art 2 of the First Protocol does provide a right to education, but it is stated in negative terms (“No person shall be denied the right to education.”). As such, it is more concerned with discrimination and with parental choice than minimum standards regarding the quality or availability of education.

50 Handyside v United Kingdom (App No 5493/72) (1976) Series A No 24.

51 ibid [62].

52 In addition, that the confiscation was not discriminatory; the applicant maintained that art 14 discrimination was involved, on the basis of his political views [65]–[66].

53 Sporrong (n 2) [69].

54 Arguably, Marckx v Belgium (App No 6833/74) (1977) Series A No 31 [63] foreshadowed Sporrong, as the Court declared that the ‘peaceful enjoyment of possessions’ did not apply solely to the enjoyment of possessions, but it expressed a general right of property, and therefore protected all rights associated with property. Hence, ‘the right to dispose of one's property constitutes a traditional and fundamental aspect of the right of property’. In doing so, it applied the classic liberal conception of ownership as full dominion over the object of property.

55 ibid [73].

56 James (n 1) [54]; Lithgow (n 1) [120].

57 James ibid; Lithgow ibid [121].

58 Sporrong and Lönnroth v Sweden (App No 7151/75; 7152/75) (1980) [123] (EComHR).

59 See also the recommendations of the Irish Committee on the Price of Building Land, discussed above, text accompanying (n 36).

60 In Sporrong (n 2) [69], after stating the fair balance principle, the Court stated that the ‘Agent of the Government recognised the need for such a balance.’ However, the Court went on to say that ‘At the hearing on the morning of 23 February 1982, he pointed out that, under the Expropriation Act, an expropriation permit must not be issued if the public purpose in question can be achieved in a different way; when this is being assessed, full weight must be given both to the interests of the individual and to the public interest.’ This falls far short of a general concession that the fair balance must apply in every case, especially in respect of substantive elements.

61 ibid [69].

62 ibid [61].

63 There were references to Marckx, but only in connection with the meaning of ‘possessions’ (ibid [57]) and actual loss (ibid [73]).

64 James (n 1) [54]; Lithgow (n 1) [120].

65 James, ibid; Lithgow, ibid [122].

66 James, ibid; Lithgow, ibid [121].

67 James, ibid; Lithgow, ibid [120]: ‘the Court observes that under the legal systems of the Contracting States, the taking of property in the public interest without payment of compensation is treated as justifiable only in exceptional circumstances not relevant for present purposes.’ The Court does not explain why this is relevant, or even explain whether it is referring to a general practice or a justiciable constitutional principle: see generally Allen (n 8) 301–302.

68 Pennell (n 11) and accompanying text.

69 Scordino v Italy (App No 36813/97) ECHR 2006-V.

70 ibid [60].

71 ibid [90]; see text accompanying (n 33) and (n 34).

72 ibid [257].

73 ibid [102], [132].

74 Mendelson, MThe United Kingdom Nationalization Cases and the European Convention on Human Rights’ (1986) 57 BYIL 33Google Scholar.

75 Compare the French Conseil d'État's decisions regarding similar issues over the valuation of shares in nationalised industries in the early 1980s, as discussed in Mendelson, MHInternational Law and the Valuation of Nationalised Shares: Two French Decisions’ (1985) 34 ICLQ 284CrossRefGoogle Scholar.

76 R (on the application of SRM Global Master Fund LP) v Treasury Commissioner [2009] EWCA Civ 788; Calamita, NJ, ‘The British Bank Nationalizations: An International Law Perspective’ (2009) 58 ICLQ 119CrossRefGoogle Scholar.

77 Banking (Special Provisions) Act 2008, s 5(4); Northern Rock plc Compensation Scheme Order 2008, para 3(2) and 6.

78 As amended by the Housing Act 1969, the Housing Act 1974, the Leasehold Reform Act 1979, the Housing Act 1980 and the Housing and Building Control Act 1984.

79 James (n 1) [57].

80 Lithgow (n 1) [121]; cf Broniowski v Poland (App No 31443/96) ECHR 2004-V 1 (GC), about the unconstitutional cancellation of claims to be given property. The scale of the problem justified cancellation at less than the face value of the claims.

81 See Allen, T, ‘Restitution and Transitional Justice in the European Court of Human Rights’ (2006/7) 13 Columbia JEL 1, 2944Google Scholar.

82 Jahn v Germany (App No 46720/99; 72203/01; 72552/01) ECHR 2005-VI (GC); Deutsch, U, ‘Expropriation without Compensation—The European Court of Human Rights Sanctions German Legislation Expropriating the Heirs of ‘New Farmers’’ (2005) 6 German LJ 1367Google Scholar.

83 Federal Constitutional Court, Judgment of 6 October 2000, 1 BvR 1637/99; passages in the text are from the ECHR translation, ibid [42].

84 Jahn v Germany (App No 46720/99; 72203/01; 72552/01) (2004) (Third Section) [90].

85 ibid [82].

86 In fairness, however, the Court did not say that the fair balance required full compensation on these facts, but only that the applicants should have been ‘adequately compensated.’ ibid [91] (emphasis added).

87 Jahn (n 82) (GC) [116].

88 There was a significant dissenting group in the Grand Chamber, and the Third Section judges were 7–0 in favour of the applicants. As the Grand Chamber went 11–6 against the applicants, and two of the judges sat on both judgments, the split was 11–11.

89 Urbárska Obec Trenčianske Biskupice v Slovakia (App No 74258/01) (2007).

90 ibid [52] and [102].

91 ibid [126].

92 ibid [131].

93 See also Vartu, M, ‘Transition as a Concept of European Human Rights Law’ (2009) 2 EHRLR 2009Google Scholar.

94 Handyside (n 50) [62].

95 Mellacher v Austria (App No 10522/83; 11011/84; 11070/84) (1989) Series A No 169.

96 It is not entirely clear whether the Court accepted this description: ibid [55]–[56].

97 ibid (joint dissenting opinion of Judges Cremona, Bindschedler-Robert, Gölcüklü, Bernhardt and Spielmann).

98 This even applied in cases where tenants were entitled to a judicial modification of a contract that they had apparently entered into without reservation: ibid [56].

99 T Allen, Property and the Human Rights Act 1998 (Hart, Oxford, 2005) 152–153.

100 Hutten-Czapska v Poland (App No 35014/97) ECHR 2006-VIII.

101 The judgment does not indicate whether the property was without value, or even without considerable value. Plainly, it would have been worth more without the rent controls, but in countries that regulate land use (ie virtually all European states), land is worth more in the absence of regulation.

102 T Allen, Property and the Human Rights Act 1998 (Hart, Oxford, 2005) 159–161.

103 However, if that was its primary objective, the effect on the jurisprudence of P1-1 is unfortunate, because it ignores the context of Polish constitutional law. That is, the Polish Constitution guarantees housing and tenancy rights; as it also guarantees property, these rights must be balanced against each other. Under the Convention, art 8 provides a right to respect for the home, and hence it is applicable to evictions; however, it does not provide a positive claim against the State to be provided with a home. The Constitutional Court's judgment raises the importance of the constitutional rights of tenants; by contrast, the Grand Chamber's judgment does not mention art 8. It acknowledges that there is a community interest in protecting tenants, but that puts tenants in a weaker position than they would be under the Polish Constitution.

104 Radovici and Stănescu v Romania (App No 68479/01, 71351/01 and 71352/01) (2006).

105 ibid [88] (emphasis added).

106 Ghigo v Malta (App No 31122/05) (2006); Fleri Soler and Camilleri v Malta (App No 35349/05) (2006); Edwards v Malta (App No 17647/04) (2006); Amato Gauci v Malta (App No 47045/06) (2009); cf Zammit and Others v Malta (App No 16756/90) (1989) 68 DR 312.

107 Ghigo ibid [49], [66]; Fleri Soler ibid [74], [78]; Edwards ibid [75], [78] Amato Gauci ibid [63].

108 Kozacioğlu v Turkey (App No 2334/03) (2009).

109 Taken alone, the depreciation rules might have been challenged: see Katikaridis v Greece (App No 19385/92) ECHR 1996-V 1673; Tsomtsos and Others v Greece (App No 20680/92) ECHR 1996-V 1699; Papachelas v Greece (App No 31423/96) ECHR 1999-II 1.

110 In this case, however, the owner managed to get the valuers to indicate the value of the special features. It was not clear just how they managed to do so. Turkish law was very clear these features were not relevant, and yet the Turkish valuation panel explicitly took them into account. In any case, the Turkish Court of Cassation reviewed the case and refused to allow the re-adjustment for historic value. The final amount of compensation was the depreciated amount.

111 Kozacioğlu (n 108) [64].

112 ibid [70].