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Housing and Human Rights – lessons from Strasbourg (1)

[2007] JHL 55


The Human Rights Act 1998 provided for the direct incorporation of the European Convention for the Protection of Human Rights (ECHR) into English and Welsh law.  It came into force on 2 October 2000.  At that time, the general view was that housing issues had not figured greatly in the deliberations of the European Court of Human Rights (ECtHR) in Strasbourg . There was little Strasbourg jurisprudence on housing law or procedure.  In 2000, a search for the word “tenant” on the ECHR web site[1] revealed fewer than a dozen housing cases.  The word “homeless” did not then appear in any judgment on the web site.  Those cases which had been decided were of little direct relevance in a British context.  Many commentators thought that direct incorporation would have a more significant impact on housing law in this country than judgments in Strasbourg .[2]


In fact the opposite has happened. Direct incorporation has not, so far, had a significant effect on English and Welsh housing law.  However, the increase in the number of countries which have adopted the ECHR and which allow their citizens to make applications to the ECtHR has significantly affected Strasbourg housing jurisprudence.  Word searches may be a crude tool, but the word “tenant” has appeared in 40 ECtHR cases in the last two years and over 100 cases in the last five years.  The word “homeless” has featured in 15 cases in the last five years. 


Many of these cases have originated in countries which were part of the former Soviet Union or Eastern Europe .  They provide a fascinating insight into housing law and procedure in such countries.  Although some of the problems are very different to those faced by tenants and homeless people in this country, some legal principles which are relevant can be extracted from these cases.



Article 1 of Protocol No. 1

Article 1 of Protocol No. 1 provides

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.


In James v  United Kingdom [3] the ECtHR stated that


[Article 1 of Protocol No. 1. comprises] "three distinct rules": the first rule, set out in the first sentence of the first paragraph, is of a general nature and enunciates the principle of the peaceful enjoyment of property; the second rule, contained in the second sentence of the first paragraph, covers deprivation of possessions and subjects it to certain conditions; the third rule, stated in the second paragraph, recognises that the Contracting States are entitled, amongst other things, to control the use of property in accordance with the general interest.    The three rules are not, however, "distinct" in the sense of being unconnected. The second and third rules are concerned with particular instances of interference with the right to peaceful enjoyment of property and should therefore be construed in the light of the general principle enunciated in the first rule.[4] 


Control of use of property

Article 1 of Protocol No. 1 does not 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.  Almost twenty years ago the ECtHR decided that an Austrian law limiting rents to a particular amount per square metre did not breach Article 1[5]. Rent regulation is control of property, not deprivation.   In Spadea and Scalabino v Italy [6] the Court held that Italian laws staggering or delaying the operation of possession orders were not a breach of Article 1.  It noted that

The second paragraph reserves to States the right to enact such laws as they deem necessary to control the use of property in accordance with the general interest. . . . . . Such laws are especially common in the field of housing, which in our modern societies, is a central concern of social and economic policies. . . . . In order to implement such policies, the legislature must have a wide margin of appreciation . . . .The Court will respect the legislature’s judgment as to what is in the general interest unless that judgment is manifestly without reasonable foundation. . . . .  an interference 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. . . . There must be a reasonable relationship of proportionality between the means employed and the aim pursued.[7]


In Scollo v Italy[8] the ECtHR confirmed that the temporary laws suspending evictions were neither a transfer of property nor a de facto appropriation.  The control of property provided for by those laws was in the general interest. 


In Velosa Barretto v Portugal ,[9] the ECtHR considered a law giving tenants security of tenure, subject to various grounds for possession – e.g. “landlord needs property in order to live there or to build his home there”.  The landlord was refused a possession order because he and his family could continue living with relatives.  The landlord complained unsuccessfully that there was a breach of Article 8 and the second paragraph of Article 1 of Protocol No. 1.  The Court stated



Like the Commission, the Court considers that the legislation applied in this case pursues a legitimate aim, namely the social protection of tenants, and that it thus tends to promote the economic well-being of the country and the protection of the rights of others.


Although the restriction on the landlord's right to terminate his tenant's lease constituted control of the use of property within the meaning of the second paragraph, that restriction pursued a legitimate social policy aim.  It struck 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.  That theme of a wide margin of appreciation[10] permitted to modern social democratic governments runs though most of the recent Strasbourg housing cases.  It was clearly explained in James[11] where the ECtHR said

 


Because of their direct knowledge of their society and its needs, the national authorities are in principle better placed than the international judge to appreciate what is "in the public interest". Under the system of protection established by the Convention, it is thus for the national authorities to make the initial assessment both of the existence of a problem of public concern warranting measures of deprivation of property and of the remedial action to be taken.  … More especially, modern societies consider housing of the population to be a prime social need, the regulation of which cannot entirely be left to the play of market forces. The margin of appreciation is wide enough to cover legislation aimed at securing greater social justice in the sphere of people’s homes, even where such legislation interferes with existing contractual relations between private parties and confers no direct benefit on the State or the community at large.


However in Schirmer v Poland [12] the ECtHR held that the refusal of a court to order the eviction of a tenant because the alternative accommodation offered was subject merely to “a cooperative right” and not the landlord's own property in the civil law sense of the term, amounted a violation of Article 1 of Protocol No. 1.  In accordance with the provisions of the Polish Law on the Lease of Dwellings and Housing Allowances (1994), the tenant was permitted to remain in the apartment owned by the landlord paying a controlled rent, while the landlord could not live in it. The ECtHR found that there had been control of the use of property.  Any such interference with the peaceful enjoyment of possessions must strike a fair balance between the demands of the general interests of the community and the requirements of the protection of the individual's fundamental rights.  In other words, there must be a reasonable relationship of proportionality between the means employed and the aim sought to be realised.[13]   As to the proportionality of the interference, the ECtHR  accepted that the guiding principle behind the provision of the Law on the Lease of Dwellings was to secure the rights of a tenant in alternative accommodation.  Such consideration were legitimate, in particular in situations of housing shortage. The Court recognised that difficult legal and social issues may arise in connection with balancing the rights of owners against those of tenants.  These difficulties constituted part of the process of transition from a socialist legal order and its property regime to one compatible with the rule of law and the market economy, a process which was “fraught with difficulties”. It was not in dispute that the landlord possessed a co-operative right in relation to the alternative accommodation and that it was a quasi-proprietorial right in rem, which could be sold and bequeathed. It was also not in dispute that the co-operative had agreed that the tenant could occupy that apartment.  The ECtHR found that the landlord’s co-operative right to the alternative apartment was sufficiently similar to ownership to serve one of the aims of the 1994 Law, i.e. to secure a stable position of the relocated tenant in the alternative apartment.  The Court concluded that the landlord's rights were not given sufficient attention and that, more generally, the drafters of the 1994 Law put too much emphasis on the rights of tenants, overlooking those of landlords.   As a result, the landlord had to bear an individual and excessive burden that upset the fair balance that must be maintained between the demands of the general interest and protection of the right to the peaceful enjoyment of possessions.


State use of private property

The extent of the margin of appreciation is demonstrated by Hutten-Czapska v Poland [14], where, even though a family had been deprived of the use of their home for almost fifty years, the ECtHR only found that there was a breach of Article 1 of Protocol No. 1 because the rent received from the state was so low. The house in Gdynia, Poland , which Mrs Hutten-Czapska’s parents owned, was appropriated by the Nazis during the Second World War, and later occupied by soldiers of the Red Army.  During the Polish Communist era, it became subject to state management and was administered by the Gdynia City Council Housing Department, which let it to tenants. At one time it was occupied by the Head of the Housing Department as his personal residence.  Rent control provisions drastically restricted the amount of rent chargeable.  In the 1990s, Mrs Hutten-Czapska unsuccessfully tried to recover the property, but claims for possession against the tenants were dismissed.  The rent control provisions did not change significantly after the end of communist rule in 1989.  Indeed, by the 1990s the state-controlled rent, which also applied to privately owned buildings, covered merely 30% of the actual cost of maintenance of buildings.  In the ECtHR, Mrs Hutten-Czapska alleged that the implementation of laws imposing restrictions in rent increases and the termination of leases amounted to a violation of Article 1 of Protocol No. 1.


The Grand Chamber of the ECtHR noted that, although Mrs Hutten-Czapska could not exercise her right of use in terms of physical possession as the house had been occupied by tenants, and that her right to let the flats, including her right to receive rent and to terminate leases, had been subject to a number of statutory limitations, she never lost her right to sell her property. Nor had the authorities applied any measures resulting in the transfer of her ownership. In the Chamber’s judgment, those issues concerned the degree of the State’s interference, and not its nature. The aim of all the measures taken was to subject the applicant’s house to continued tenancies, and not to take it away from her permanently.  They could not be considered a formal or even de facto expropriation but constituted a means of State control of the use of her property.  Accordingly, the case fell to be examined under the second paragraph of Article 1 of Protocol No. 1.  It is for national authorities to make the initial assessment as to the existence of a problem of public concern warranting measures to be applied in the sphere of the exercise of the right of property, and, in doing so, they enjoy a wide margin of appreciation.  The Grand Chamber accepted that the interference respected the principle of lawfulness.  It also agreed that the rent-control scheme in Poland originated in the continued shortage of dwellings, the low supply of flats for rent on the lease market and the high costs of acquiring a flat. It was implemented with a view to securing the social protection of tenants and ensuring the gradual transition from State controlled rent to a fully negotiated contractual rent during the fundamental reform of the country following the collapse of the communist regime.  The court accepted that in the social and economic circumstances of the case, the impugned legislation had a legitimate aim in the general interest, as required by the second paragraph of Article 1.  However, after noting that the rent which she received was very low, the Court held that the legislation “impaired the very essence of her right of property” and individual landlords had been “deprived even of the slightest substance of their property rights”.   Their “right to derive profit from property, ... an important element of the right of property ha[d] been destroyed and ... the[ir] right to dispose of one’s property ha[d] been stripped of its substance.” The legislation “unduly restricted [Mrs Hutten-Czapaska’s] property rights and placed a disproportionate burden on her, which [could] not be justified in terms of the legitimate aim pursued by the authorities in implementing the relevant remedial housing legislation.”  The ECtHR accordingly found that there had been a violation of Article 1 of Protocol No. 1.  The Court reserved the question of compensation for pecuniary damage because it was not ready for decision, but made an award for non-pecuniary damage of EUR 30,000.


The ECtHR applied similar principles and arrived at similar conclusions in Ghigo v Malta,[15]  Edwards v Malta[16] and Fleri Soler and Camilleri v Malta [17]. In all three cases property owned by the applicants, or their family, was seized by the government under requisition orders issued under the Maltese Housing Act in order to house homeless people.  Proceedings in the local courts seeking to set aside the requisition orders and to recover use of the properties were unsuccessful. In Ghigo, the ECtHR noted that by requisitioning and assigning property to others, the government prevented the owner from exercising his right to use the property. Also, his right to receive a market rent and to terminate leases had been substantially affected. However, he never lost his right to sell his property, nor had the authorities applied any measures resulting in the transfer of his ownership of the property.  It followed that the interference was not a formal or even de facto expropriation, but constituted a means of State control of the use of property and that the case fell to be examined under the second paragraph of Article 1 of Protocol No. 1.  It was not disputed that the requisition of the house had been carried out in accordance with the provisions of the Maltese Housing Act.  It was, therefore, “lawful” within the meaning of Article 1.  Having regard to the wide margin of appreciation available to the legislature in implementing social and economic policies, the court accepted the government's argument that requisition and rent control were aimed at ensuring the just distribution and use of housing resources in a country where land available for construction could not meet the demand and with a view to securing the social protection of tenants and preventing homelessness, as well as at protecting the dignity of poorly-off tenants.  The legislation therefore had a legitimate aim in the general interest.  However, the rent received by Mr Ghigo – less than EUR 5 per month – was extremely low and could hardly be seen as fair compensation for the use of a house.  The court was not convinced that the interests of landlords, "including their entitlement to derive profits from their property" were met by restricting the rent to this level.  The court found that, having regard to the extremely low rent fixed by the Land Valuation Officer, and to the fact that the applicant's premises had been requisitioned for more than twenty-two years, a disproportionate and excessive burden had been imposed on Mr Ghigo.  He had been requested to bear most of the social and financial costs of supplying housing accommodation to the family living in the house.  There was accordingly a violation of Article 1 of Protocol No. 1.  The Court reserved the question of compensation for pecuniary damage and/or non-pecuniary damage because it was not ready for decision.


In Radanovic v Croatia[18] the ECtHR considered the Croatian Temporary Takeover and Managing of Certain Property Act which provided that property belonging to people who left Croatia after October 1990 was to be taken into the care of, and controlled, by the State. It also authorised local authorities temporarily to accommodate other persons in such property. Mrs Radanovic left the flat which she owned in 1991 to join her son in Germany .  When she eventually regained possession in January 2004, she found that it had been looted and rendered uninhabitable.  The ECtHR found that there had indisputably been an interference with her right to property as her flat was allocated for use to another person and she was unable to use it for a prolonged period of time.  It further noted that she was not deprived of her title and so the interference complained of constituted a control of use of property within the meaning of Article 1 of Protocol No. 1, para 2.  Assuming that the interference complained of was lawful and in the general interest, it had to consider whether it struck the requisite fair balance between the demands of the general interest of the public and the requirements of the protection of the individual's fundamental rights, and whether it imposed a disproportionate and excessive burden on the applicant.  The Court recognised that the Croatian authorities faced an exceptionally difficult task in having to balance the rights of owners against those of temporary occupants in the context of the return of refugees and displaced persons, as this involved dealing with socially sensitive issues. Those authorities had to secure the protection of property and social rights. The Court therefore accepted that a wide margin of appreciation should be accorded to the State.  However, in this case, Mrs Radanovic was forced to bear the burden of providing the temporary occupant with a place to stay for more than six years.  This burden should have been borne by the State.  Notwithstanding the State's margin of appreciation, the Court considered that the Croatian authorities failed to strike the requisite fair balance between the general interest of the community and the protection of Mrs Radanovic's right to property. As a result, she had to bear an excessive individual burden.  The interference with her right to property could not be considered proportionate to the legitimate aim pursued.  There was accordingly a breach of Article 1 of Protocol No. 1.  The Court also concluded that Mrs Radanovic had no effective remedy for the protection of her ECHR right to property and that there had been a breach of Article 13.  The Court awarded EUR 6,000 on account of the loss of rent and EUR 2,500 in respect of non-pecuniary damage.


Adverse possession

Against this background of case law, the decision in JA Pye (Oxford) Ltd v United Kingdom[19] that the provisions of Limitation Act 1980 s15(1) which allowed trespassers to obtain possessory title by twelve years adverse possession, without any provision of compensation to land owners, was a violation of Article 1 of Protocol No.1, is perhaps not surprising.  In that case, the ECtHR repeated that any interference with the peaceful enjoyment of possessions must strike a “fair balance” between the demands of the public interest and the protection of individuals’ fundamental rights.  There must be a reasonable relationship of proportionality between the means employed and the aim sought to be realised by any measure depriving people of their possessions or controlling their use. Compensation terms are material to the assessment of whether the law respects the requisite fair balance.  The taking of property without payment of an amount reasonably related to its value will normally constitute a disproportionate interference that cannot be justified under Article 1 of Protocol No. 1. This provision does not, however, guarantee a right to full compensation in all circumstances.  The Limitation Act 1980 did more than merely preclude Pye from invoking the assistance of the courts to recover possession of the property concerned.  It deprived Pye of their substantive property rights as well as precluding them from lawfully repossessing the land. It was the legislative provisions alone (and not the acts of the trespassers) which deprived Pye of their title.  Article 1 of Protocol No. 1 was accordingly engaged and the operation of the Limitation Act 1980 constituted an interference by the State with Pye’s ECHR rights. The ECtHR rejected the government’s claim that the law of adverse possession served a continuing public interest.  The UK Government’s appeal to the Grand Chamber has been heard and judgment is awaited.


Forfeiture of leases

It is also interesting to speculate whether the English and Welsh law of forfeiture, which allows for the termination of long leases, which are often highly valuable assets, without compensation, is fully compliant with Article 1 of Protocol No. 1.  For example, in the 1970s, Margarita Di Palma[20] bought a 99 year lease of a flat in Chiswick.  She unsuccessfully disputed service charges of £299 demanded by the freeholder and in 1981 an order for forfeiture was made, providing for payment of the arrears within two months.  That sum was not paid and Ms Di Palma was evicted.  Her subsequent application to the ECtHR was declared inadmissible.[21]   Referring to the alleged violation of Article 1 of Protocol No. 1, the ECtHR said

           

“It would not appear that the mere fact that an individual was the unsuccessful party to private litigation concerning his tenancy arrangements with a private landlord could be sufficient to make the state responsible for an alleged violation of Prot. 1 Art 1.”


In the light of recent decisions, would Ms Di Palma’s application still be declared inadmissible? There is no doubt that the modern law of forfeiture is in accordance with the law and serves the legitimate purpose of allowing landlords to recover possession where there are arrears of rent or some other breach of covenant, but isn’t a law which allows a landlord to recover possession of a valuable asset as a result of relatively small arrears of rent, without paying compensation, a disproportionate interference that cannot be justified under Article 1 of Protocol No. 1?  To some extent the question has been side stepped by recent legislation[22] which has made it increasingly difficult for landlords to forfeit residential premises held on long leases purchased for a premium, but should the government be considering legislation obliging landlords to pay compensation when the value of forfeited premises is wholly disproportionate to, say, the arrears?[23]



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[1] http://cmiskp.echr.coe.int/tkp197/search.asp?skin=hudoc-en

[2] For what was in retrospect an overly optimistic (or depending on one’s views, pessimistic) assessment of the likely impact of the Human Rights Act, see Possession Proceedings and Human Rights [2001] JHL 3, 21 See too Luba, Possession day in the county court, (2000) New Law Journal, October 6, 1456, Luba, Housing Law and Human Rights Act September 2000 Legal Action 27 and Henderson Possession Proceedings and the HRA (2000) Solicitors Journal October 6, 906. 

[3] Application no. 8793/79; 21 February 1986.

[4] See too  Sporrong and Lönnroth, (Series A no. 52, p. 24, para. 61, Housing Association of War Disabled and Victims of War of Attica v Greece Application no. 35829/02; 13 July 2006, para 32. Iatridis v. Greece [GC], no. 31107/96, § 55, ECHR 1999-II; Immobiliare Saffi v. Italy [GC], no. 22774/93, § 44, ECHR 1999-V; James and Others v. the United Kingdom,  21 February 1986, Series A no. 98, pp. 29-30, § 37, Beyeler v. Italy [GC], no. 33202/96, § 98, ECHR 2000-I, and Saliba v. Malta, no. 4251/02, § 31, 8 November 2005).  Schirmer v Poland   Application no. 68880/01;  21 September 2004

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[5] Mellacher v Austria (1989) 12 EHRR 391.  See too Spath Holme Ltd v UK Application No. 78031/01, where a claim that the Rent Acts (Maximum Fair Rent) Order 1999 SI No 6, which capped increases in fair rents to a level between 5% and 7.5% above inflation, breached landlords’ ECHR rights was held inadmissible.

[6] (1995) 21 EHRR 482.   See too Immobiliare Saffi v Italy [GC], no. 22774/93, §§ 18-35, ECHR 1999-V and A.O. v Italy 22534/93, 4 October 2000.

[7] In the more recent case of Sorrentino Prota v Italy 40465/98; 29 January 2004, when considering Article 1, the ECtHR stated that “there must be a reasonable relationship of proportionality between the means employed and the aim pursued.”

[8] [1996] 22 EHRR 514

[9] [1996] EHRLR 212      

[10] “margin of appreciation” is a mis-translation of the French “pouvoir d’appreciation.

[11] Application no. 8793/79; 21 February 1986.

[12] Application no. 68880/01;  21 September 2004

[13]  James v United Kingdom   Application no. 8793/79; 21 February 1986.

[14] Application no. 35014/97; [2006] ECHR 628; 19 June 2006.  See too Beshiri v Albania Application no. 7352/03; 22 August 2006

[15] Application no. 31122/05; [2006] ECHR 808; 26 September 2006. 

[16] Application no. 17647/04; [2006] ECHR 887; 24 October 2006

[17] Application no. 35349/05; 26 September 2006 where premises were requisitioned for almost sixty-five years and the compensation paid was EUR 213 for the years 1941-1988 and EUR 817 from 1989 onwards.

[18] Application no. 9056/02; 21 December 2006.  See too Kunic v Croatia Application no. 22344/02; 11 January 2007

[19]  Application no. 44302/02; 15 November 2005; [2005] 49 E.G. 90;  (2005) Times November 23.  For Grand Chamber, see J.A. Pye ( Oxford ) Ltd v The United Kingdom 30 August 2007; (2007) Times, October 1

[20] See [1985] 2 All ER 676.  The particular injustice of this case, the words “barred from all relief” contained in County Courts Act 1959 s191(1)(c), which prevented Ms Di Palma’s subsequent application for relief, was cured by Administration of Justice Act 1985 s55 which added subsections (9A) to (9C) to County Courts Act 1984 s136

[21] Di Palma v UK (1988) 10 EHRR 149

[22] e.g. Landlord and Tenant Act 1985 ss 19 to 30, Landlord and Tenant Act 1987 Sched 2, Housing Act 1996 s81 and 82 and Commonhold and Leasehold Reform Act 2002 ss151 to 155 and Scheds 9 and 10.

[23] It is interesting to note that although the Law Commission in its report Termination of Tenancies for Tenant Default October 2006 CM 6946 considered the compatibility of its proposals with the ECHR, the Report makes no reference to the possible incompatibility of the existing law with Article 1 of the Protocol No. 1.