CEDH · CASELAW;DECISIONS;DECCOMMISSION;ENG — 10 septembre 1996

.sDD6737AE { font-size:11pt } .s211D6B00 { margin-top:0pt; margin-bottom:0pt; line-height:normal; widows:0; orphans:0; font-size:8.5pt } .sBB9EE52A { font-family:Arial }                          AS TO THE ADMISSIBILITY OF                         Application No. 26347/95                       by V.S. and T.H.                       against the Czech Republic        The European Commission of Human Rights (Second Chamber) sitting in private on 10 September 1996, the following members being present:              Mrs.   G.H. THUNE, President            MM.    J.-C. GEUS                  G. JÖRUNDSSON                  A. GÖZÜBÜYÜK                  J.-C. SOYER                  H. DANELIUS                  F. MARTINEZ                  L. LOUCAIDES                  M.A. NOWICKI                  I. CABRAL BARRETO                  J. MUCHA                  D. SVÁBY                  P. LORENZEN                  E. BIELIUNAS                  E.A. ALKEMA                  M. VILA AMIGÓ              Ms.    M.-T. SCHOEPFER, Secretary to the Chamber        Having regard to Article 25 of the Convention for the Protection of Human Rights and Fundamental Freedoms;        Having regard to the application introduced on 16 September 1994 by V.S. and T.H. against the Czech Republic and registered on 27 January 1996 under file No. 26347/95;        Having regard to :   -     the reports provided for in Rule 47 of the Rules of Procedure of      the Commission;   -     the Commission's decision of 11 April 1996 to declare the      application inadmissible;   -     the observations submitted by the applicants on 11 July 1996;        Having deliberated;        Decides as follows:   THE FACTS        The applicants are two Czech citizens born in 1933 and 1931 respectively.   They reside in Prague.   Before the Commission, they are represented by Mrs. E. Schramm, a lawyer practising in Bielefeld and Prague.        The facts of the case, as submitted by the applicants, may be summarised as follows.     A.    The particular circumstances of the case        The applicants jointly own a house in Prague 10 comprising three apartments.   The applicants occupy two apartments, the third one (consisting of five rooms and a kitchen with a total surface area of 126m²) was leased to Mr. B. on 1 September 1988 by the Prague 10 District Office which, under the former legislation, had the right to dispose of apartments in private houses.   The rent was set at 294.00 crowns, with maintenance contributions 400.00 crowns, pursuant to the Decree No. 60/1964.        On 4 April 1991 the applicants informed Mr. B. of an increase in the rent and maintenance contributions.   They claimed a monthly rent of 12,600.00 crowns (i.e. 100.00 crowns per square metre) and maintenance contributions of 1,300.00 crowns as from 1 May 1991.   They considered that the existing rent plus maintenance contributions did not cover their actual costs.   At the same time, they gave notice to Mr. B. asking him to leave the apartment.        The tenant refused, following which the applicants brought proceedings against him before the Prague 10 District Court (Obvodní soud pro Prahu 10) asking that the lease be terminated and that Mr. B. be ordered to leave the apartment.   They also sought orders modifying the rent and the maintenance contributions to the effect that Mr. B. would have to pay the above sums as from 1 May 1991.        The Prague 10 District Court found against the applicants on 5 November 1991.   The Court stated that:   [Translation]        "[Mr. B.] uses the apartment on the basis of an exchange of      apartments [made with a former tenant], which was approved      by the Prague 10 District Office ...        The rent and maintenance contributions are governed by      Regulation   No. 60/1964 ...   The applicants' proposal to      increase the rent to 12,600.00 crowns is unjustified      because according to this Regulation, the rent is fixed at      294.00 crowns ... The court also rejects the applicants'      proposal to increase the maintenance contributions as they      have not proved the actual costs."        The applicants' appeal against this decision was dismissed by the Prague Municipal Court (Mestsky soud v Praze) on 22 April 1992.   The Court found:   [Translation]        "... on the basis of an approved exchange of apartments of      17 August 1988, ... Mr. B. became entitled to make an      agreement about taking over an apartment [with the owners      of the house].   The right to use the apartment was      established only after the agreement had been made.   The      former legislation did not require a written form for such      an agreement, but it was also possible to conclude an oral      or even an implied contract.        ... the agreement between the applicants and [Mr. B.] was      made tacitly. ... although the applicants and [Mr. B.] did      not express their will to conclude an agreement about      surrendering and taking over the apartment, it was obvious      that they intended to do so ... the applicants expressed      their consent to [Mr. B]'s moving into the apartment ...      This conclusion is not affected by the fact that the      applicants, under the former legislation, did not have the      right to consent to the exchange of apartments.        ... it follows that from 1 September 1988 [Mr. B.] had the      right to use the apartment in question.   As from      1 January 1992 this legal relationship was transformed to      a lease contract (Article 871 para. 1 of the Civil Code).      If the applicants prove that they need the apartment for      themselves, ..., they may terminate the lease with the      court's consent.        ... Until 31 December 1991 the rent and maintenance      contributions were governed by Regulation No. 60/1964 ...      which excluded unilateral rent increases.   The maintenance      contributions were determined by Article 13 of the above      Decree.   This regulation was amended and the new Regulation      No. 15/1992 entered into force on 1 January 1992.   In the      present case, the rent and maintenance contributions should      be agreed between the owner and tenant under Article 16.      A unilateral rent increase is possible only if the actual      amount of a rent does not reach the level set out in      Article 5; ... this [is not the problem in the present      case.]"        On 26 August 1993 the applicants lodged a constitutional appeal. They referred to the Charter of Fundamental Rights and Freedoms and alleged that the relevant legislation, in particular Article 871 para. 1 of the Civil Code, constitutes an illegal interference with their right to property, respect for their dignity, equality in treatment, and that they are thereby obliged to provide free services to their tenant which amounts to forced labour.   They also complained about the unfairness of the proceedings at first and second instance as the courts had rejected their request for increased maintenance contributions.   The applicants further requested that Article 871 para. 1 of the Civil Code be quashed as unconstitutional.        On 22 March 1994 the Assembly of the Constitutional Court rejected the applicants' constitutional appeal as to the alleged unconstitutionality of Article 871 para. 1 of the Civil Code and declared that this provision was compatible with the Charter of Fundamental Rights and Freedoms.   The Court considered that:   [Translation]        "... the right to use an apartment was based on an      administrative decision about the surrender and taking over      of the apartment, often without the owner's consent.      However, the Court must take into account the conflict      between the owners' interests in disposing of their      apartments and the tenants' interests in protecting their      rights.   Article 871 para. 1 of the Civil Code is a      regulation about transformation of rights.   Its purpose is      to ensure protection of tenants and to create legal      certainty with regard to relationships between owners and      tenants.   This legal provision is in conformity with ...      the Constitution ... and, in this respect, it cannot be      considered as unconstitutional."        On 7 July 1994 the Chamber of the Constitutional Court dismissed the remainder of the applicants' constitutional appeal as unsubstantiated.   The Court stated that:   [Translation]        "The applicants allege a violation of their right to be      protected by a court under Article 38 para. 1 of the      Charter of Fundamental Rights and Freedoms because the      courts found against them. ... they criticised the      appreciation of evidence by the courts as they considered      that the agreement about the surrendering and taking over      of the apartment was concluded tacitly. ... [T]he      Constitutional Court is not a further level of jurisdiction      and it thus generally has no power to reexamine the      activities of those courts; it has such a right only in      those cases where the constitutional principles have been      breached. However, the fact that the applicants' claim was      unsuccessful does not in itself constitute a violation of      the right to be protected by a court ...        [The] ordinary courts found that ... the tenant's right to      the use of the apartment was established per facta      concludentia ... Following the judicial practice, [an      implied contract] also exists where one party begins to      execute obligations resulting from a contract even without      expressly accepting its text.   According to the courts'      findings, the applicants have done this. ... In view of the      above the user of the apartment gained the right to its use      [which was] transformed into a lease pursuant to      Article 871 para. 1 of the Civil Code.   The ordinary court      applied this legal provision and the Constitutional Court      does not find its application to be in contradiction with      Article 11 of the Charter.        [Finally], the courts' decision to dismiss the claim      concerning the maintenance contribution is not a decision      which would violate the applicants' fundamental rights or      freedoms. ... It is an ordinary civil matter which cannot      be considered by the Constitutional Court."     B.    Relevant domestic law        According to Chapter III of the (former) Civil Code, the District Office had the right to dispose of apartments in private houses.   It also assigned apartments and approved exchanges between tenants.   On the basis of such approval, tenants became entitled to conclude (in writing, orally or tacitly) agreements with owners about the surrendering and taking over of an apartment which created a right to use an apartment.   Owners did not have the right to consent to the exchange of their apartments; if they refused, the courts could give their approval.        By an amendment to the Civil Code (Article 871 para. 1) which entered into force on 1 January 1992, the right to use an apartment (created between the administrative authority and the tenant) was transformed into a lease contract between the tenant and the owner.        Until 31 December 1991 rent and maintenance contributions were governed by Regulation No. 60/1964 on Compensation for the Use of an Apartment and for the Maintenance Contributions Related to that Use (Vyhláska o úhrade za uzívání bytu a za sluzby spojené s uzíváním bytu).   This Regulation was amended by Regulation No. 15/1992 which entered into force on 1 January 1992.   Pursuant to Article 5 para. 2 of this Regulation, the rent of apartments was increased by about 100% with effect from 1 July 1992.        Pursuant to Article 72 para. 1a) of Law No. 182/1993 on the Constitutional Court (Zákon o Ústavním soudu), as amended, a constitutional appeal can be lodged by a physical or legal person alleging a violation, by a final decision in proceedings to which that person was a party or by any other interference by an organ of the public authorities, of that person's fundamental rights or freedoms as guaranteed by a constitutional statute or an international treaty to which the Czech Republic is a party.     COMPLAINTS        The applicants originally complained that, by the application of Article 871 para. 1 of the Civil Code, which converted the right to use the apartment created between the State administrative authority and the tenant into a lease contract between the owners and the tenant, they were subjected to an unjustified interference with their right to the peaceful enjoyment of their possessions, in violation of Article 1 of Protocol No. 1.   They also complained that they were required to provide free services to their tenant, in violation of Article 4 para. 2 of the Convention.     PROCEDURE BEFORE THE COMMISSION        On 11 April 1996 the Commission (Second Chamber) declared the application inadmissible in part (the complaint under Article 1 of Protocol No. 1 to the Convention) for non-exhaustion of domestic remedies and in part (the complaint under Article 4 of the Convention) as manifestly ill-founded.        On 11 July 1996 the applicants' representative wrote to the Secretary to the Commission, claiming that the non-exhaustion reasoning followed by the Commission was inappropriate, as the complaint under Article 1 of Protocol No. 1 related not to the levels of rent which the applicants could receive, but to the transformation as a result of Article 871 para. 1 of the Civil Code of the right to use the apartment created between the State administrative authority and the tenant into a lease contract between the owners and the tenant.     THE LAW   1.    The applicants repeat their complaint that, by the application of Article 871 para. 1 of the Civil Code, they were subjected to an unjustified interference with their right to the peaceful enjoyment of their possessions, contrary to Article 1 of Protocol No. 1 (P1-1).        Whilst it is true, as the Commission indicated in its decision of 11 April 1996, that the applicants did not submit to the courts and, ultimately, to the Constitutional Court, a complaint concerning the new rent regulations, it is also true, as the applicants point out, that the applicants did make before the Constitutional Court an allegation that the transformation by Article 871 para. 1 of the Civil Code of the right to use the apartment created between the State administrative authority and the tenant into a lease contract between the owners and the tenant breached Article 1 of Protocol No. 1 (P1-1) to the Convention.        The Commission finds it appropriate to re-open this application to the extent necessary to consider the applicants' claim concerning the application of Article 871 para. 1 of the Civil Code.        Article 1 of Protocol No. 1 (P1-1) reads as follows:        "1.    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.        2.     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."        The Commission first notes that the applicants were never deprived of their possessions: their right to use the property was restricted in the past by the former legislation and is now subject to similar restriction by virtue of Article 871 para. 1 of the Civil Code.        The Commission next notes that the former legislation was in force until 31 December 1991, which is before the Convention entered into force in respect of the Czech Republic.   The Commission is therefore not competent ratione temporis to examine the former legislation in the present case.        As regards the new legislation - Article 871 para. 1 of the Civil Code - the Commission finds that the transformation as a result of Article 871 para. 1 of the Civil Code of the right to use the apartment created between the State administrative authority and the tenant into a lease contract between the owners and the tenant may be regarded as a control of the use of property within the meaning of the second paragraph of Article 1 of Protocol No. 1 P1-1).   The Commission must therefore examine whether the control in the present case was lawful, in accordance with the general interest, and whether it pursued a legitimate aim in a proportionate manner (cf. Eur. Court HR, the Tre Traktörer AB v. Sweden judgment of 7 July 1989, Series A no. 159, pp. 22-24, paras. 56-63).        The Commission recalls the case-law of the Convention organs where it is recognised that State intervention in socio-economic matters such as housing is often necessary in securing social justice and public benefit.   In this area, the margin of appreciation available to a legislature in implementing social and economic policies is necessarily a wide one both with regard to the existence of a problem of public concern warranting measures of control and as to the choice of the rules for the implementation of such measures.   The Convention organs will respect the legislature's judgment as to what is in the general interest unless that judgment is manifestly without reasonable foundation (cf. Eur. Court HR, the Mellacher and Others v. Austria judgment of 19 December 1989, Series A no. 169, p. 25, para. 45, and the James and Others v. the United Kingdom judgment of 21 February 1986, Series A no. 98, p. 32, para. 46).        The change in law brought about by Article 871 para. 1 of the Civil Code had the effect of transferring the rights and obligations from the State to an owner of property.   To the extent that the applicants were affected by the provision at all, the changes were beneficial, since the applicants thereby attained a slightly higher degree of control over their apartment than they had previously enjoyed.   Moreover, the aim of Article 871 para. 1 of the Civil Code, which was to ensure that the legal relationship for tenants was a relationship between a tenant and an owner, rather than between a tenant and the State, cannot be considered to be unreasonable.        It is true that the applicants claim that the courts did not examine the real effect of the application of Article 871 para. 1 of the Civil Code on their case and that they did not verify the proportionality between their rights as owners and the rights of the tenant, i.e. the proportionality between the rent and maintenance contribution allowed to the applicants' tenant and the actual costs of the apartment borne by the owners.   However, no such complaint has been submitted to the ordinary courts, nor, at final instance, to the Constitutional Court although it was open to the applicants to do so. In particular, they could have challenged the rent regulations which were then in force, submitting evidence on the difference between the rent and actual costs.        In any event, the Commission finds that, bearing in mind the wide margin of appreciation afforded to States in regulating housing problems, the control of the use of the applicants' property was justified within the meaning of the second paragraph of Article 1 of Protocol No. 1 (P1-1).        It follows that this part of the application is manifestly ill- founded within the meaning Article 27 para. 2 (Art. 27-2) of the Convention.          For these reasons, the Commission, unanimously,        DECIDES TO RE-OPEN the claim relating to the application of      Article 871 para. 1 of the Civil Code to the applicants' case,      and        DECLARES IT INADMISSIBLE.         M.-T. SCHOEPFER                            G.H. THUNE          Secretary                                President     to the Second Chamber                  of the Second Chamber