Decision no. 210
of 8 April 2014
on the exception of unconstitutionality of the second sentence of Article 4 compared to
Article 1 (2) of Law no. 165/2013 on measures to finalise the process of restitution, in kind
or by equivalent, of property wrongfully confiscated under the Communist regime in
Romania, in the wording prior to the amendment of these provisions by Law no. 368/2013
amending and supplementing Law no. 165/2013
published in the Official Gazette of Romania, Part I, no. 418 of 5 June 2014
Summary
I. As grounds for the exception of unconstitutionality, the author argues that the
provisions of Law no. 165/2013 cannot be applied retroactively and cannot be relevant in cases
which are pending on the date of entry into force of the law, as they are be finalised under the
law in force on the date the civil action was lodged, i.e. under Law no. 10/2001 on the rules
governing immovable property wrongfully acquired by the State between 6 March 1945 and
22 December 1989. The author also submits that, under the rules in force on the date of the
proceedings in first instance, he obtained ownership of an immovable property in compensation
for the one abusively taken from his ancestor during the Communist regime. The new law (Law
no. 165/2013) “brings serious changes for the whole restitution process”, particularly on how
to grant the corrective measurs, which is restricted to compensation by points.
II. The Court found the compliance with the conditions for admissibility laid down in
Article 29 (1) to (3) of Law no. 47/1992, having regard to Decision no. 766 of 15 June 2011,
published in the Official Gazette of Romania Part I, no. 549 of 3 August 2011, whereby the
Constitutional Court held that the phrase “in force”, contained in the provisions of Article 29
(1) and Article 31 (1) of Law no. 47/1992, was constitutional in so far as it was construed as
meaning that laws or ordinances or provisions thereof that continued to produce legal effects
even after they were not longer in force were subject to constitutional review. Therefore,
although the legal provisions under examination are no longer a part of the active legislation,
the Court ruled on the constitutionality thereof, given that the legal relationship between the
parties is governed by the provisions of Law no. 165/2013 in the version in force at the time
the exception of unconstitutionality was invoked, which describes the situation of the author of
the exception as a facta pendentia.
III. Having examined the exception of unconstitutionality, the Court held that Law
no. 10/2001 on the rules governing immovable property wrongfully acquired by the State
between 6 March 1945 and 22 December 1989, republished in the Official Gazette of Romania,
Part I, no. 798 of 2 September 2005, provided in Article 1 (2) that “In cases where restitution
in kind is not possible, redress by equivalent shall be establised. Redress by equivalent shall
consist of compensation with other goods or services offered in equivalent by the entity
entrusted under this law with the settlement of the notification, with the consent of the person
entitled, or compensation arrangements under the specific provisions on the establishment and
payment of compensation for property wrongfully taken by the State”. Furthermore, under
Article 26 (1) of the same law, “If restitution in kind is not possible, the holder of the immovable
property or, where applicable, the entity entrusted under this law with the settlement of the
notification, is required, by decision or, where appropriate, a reasoned order, within the
deadline referred to in Article 25 (1), to grant the person entitled other goods or services in
compensation or to propose compensation under the special law on the establishment and
payment of compensation for property wrongfully taken by the State, in situations where the
measure of compensation is not possible or it is not accepted by the person entitled.”
The Court noted that, according to Article 1 (2) of Law no. 165/2013, as in force
between 20 May and 24 December 2013, “Where restitution in kind of the immovable property
wrongfully confiscated during the Communist regime is no longer possible, the only redress by
equivalent to be granted is compensation by points set out Chapter III.”
Law no. 368/2013 amending and supplementing Law no. 165/2013 on measures to
finalise the process of restitution, in kind or by equivalent, of property wrongfully confiscated
under the Communist regime in Romania, published in the Official Gazette of Romania, Part I,
no. 819 of 21 December 2013, provides in Article 1 the amendment of Article 1 (2) in the sense
that, “Where restitution in kind of property wrongfully confiscated under the Communist
regime is no longer possible, the corrective measures by equivalent that may be granted consist
of compensation with goods offered as equivalent by the entity called upon to settle the claim
made under Law no. 10/2001 on the rules governing immovable property wrongfully acquired
by the State between 6 March 1945 and 22 December 1989, republished, as subsequently
amended and supplemented, the measures provided for by the Land Fund Law no. 18/1991,
republished, as subsequently amended and supplemented, and Law no. 1/2000 for restoring
ownership of agricultural and forest land, requested in accordance with the provisions of Land
Fund Law no. 18/1991 and of Law no. 169/1997, as subsequently amended and supplemented,
and of compensation by points, as provided for in Chapter III.”
Thus, the Court found that: a) until 20 May 2013 (the date of entry into force of Law
no. 165/2013), when restitution in kind was not possible, the person entitled obtained redress
by equivalent, consisting of compensation with other goods or services offered in equivalent
and compensation granted under the conditions laid down in the special provisions governing
the establishment and payment of compensation for immovable property wrongfully
confiscated; b) between 20 May 2013 and 24 December 2013 (the date of entry into force of
Law no. 368/2013), where restitution in kind of immovable property wrongfully confiscated
under the Communist regime was no longer possible, the person entitled received one
corrective measure by equivalent – compensation by points; c) after 24 December 2013, where
restitution in kind of property wrongfully confiscated was no longer possible, the corrective
measures by equivalent that could be granted were equivalent goods provided as compensation
and compensation by points.
The Court noted that, after the exception of unconstitutionality was invoked and the
case in which the exception was invoked was settled on the merits, the legislature reconsidered
the legislative solution initially established by Article 1 (2) of Law no. 165/2013, restoring, in
addition to compensation by points, the right of the persons entitled to corrective measures by
equivalent goods provided as compensation. The legislative intervention has been motivated
as follows: “Considering that Law no. 165/2013 established that restitution in kind could take
place only in the case of the lands requested according to the land fund laws and, in practice,
restitution in kind, by compensation, of the goods requested under Law no. 10/2001 is also
requested, the provisions of Article 1 (2) and Article 42 (1) of Law no. 165/2013 need to be
amended and supplemented. These changes are necessary to avoid divergent interpretations of
the legal texts and the delay in the reconstruction of property rights. Also, these changes shall
result in a decreased pressure on the State budget, by reducing the amounts of compensations
payable in cash to the persons entitled.”
Having examined the explanatory memorandum to Law no. 368/2013 amending and
supplementing Law no. 165/2013 on measures to finalise the process of restitution, in kind or
by equivalent, of property wrongfully confiscated under the Communist regime in Romania,
the Court noted that, at the time of the adoption of Law no. 165/2013, the legislature had
omitted the situation, expressly provided for by Law no. 10/2001, concerning the corrective
measures by equivalent aimed at compensating with other goods or services offered in
equivalent by the entity vested/holder of the property with the authorisation of the person
entitled. The purpose of remedying the legislative omission was to “avoid divergencies of
interpretation of legal texts”.
However, by examining the evolution of the legal framework regarding the process of
restitution, in kind or by equivalent, of property wrongfully confiscated under the Communist
regime in Romania, the Court noted that the successive legislative amendments have generated
more than “divergent interpretations of the legal texts”, even different legal regimes applicable
to identical situations. The repeal of the legal provisions representing the legal basis for
establishing the right of the persons entitled to reparation by compensation for the abusively
taken property with other goods provided as equivalent for a period of 7 months, during which
the right holders were obliged to accept the corrective measure of compensation by points as
the sole possibility of valuing their right, followed by the restoration of this right in the form
prescribed by the previous law, demonstrates the arbitrary and unpredictable nature of the rules
adopted by the legislature. The time sequence of the legal provisions is likely to cause
instability in the legal relationships governed by Law no. 165/2013, the lack of consistency and
predictability of the rules adopted for redress by equivalent seriously affecting the principle of
legal certainty, expression of the constitutional principles of the rule of law and the obligation
to observe the Constitution, its supremacy and the laws, as enshrined in Article 1 (3) and (5) of
the Basic Law.
In its case-law, the Constitutional Court held that the essential feature of the State
governed by the rule of law was the supremacy of the Constitution and the obligation to respect
the laws, and that the rule of law ensured the supremacy of the Constitution, linking all laws
and all legislative acts to the Constitution (see in this regard Decision no. 234 of 5 July 2001,
published in the Official Gazette of Romania, Part I, no. 558 of 7 September 2001, and Decision
no. 22 of 27 January 2004, published in the Official Gazette of Romania, Part I, no. 233 of 17
March 2004). The Court also held that the principle of legal certainty was a fundamental
component of the rule of law, as enshrined in Article 1 (3) of the Basic Law (see, in this regard,
Decisions nos. 570 of 29 May 2012 and 615 of 12 June 2012, published in the Official Gazette
of Romania, Part I, no. 404 of 18 June 2012 and no. 454 of 6 July 2012).
On this issue, the European Court of Human Rights held that the principle of legal
certainty resulted implicitly from the Convention for the Protection of Human Rights and
Fundamental Freedoms and was one of the basic elements of the rule of law. In this respect, it
is worth mentioning the judgements of 20 October 2011, 6 December 2007 and 2 November
2010 in the cases of Nejdet Șahin and Perihan Șahin v. Turkey, paragraph 56, Beian v. Romania
(no. 1), paragraph 39, and Ștefănică and Others v. Romania, paragraph 31. Also, by Judgement
of 9 December 2008 in the Case of Viașu v. Romania, paragraph 64, the Court held that, in the
context of several amendments of a legal provision, clarity and forseeability required by the
notion of “legality” have been seriously affected.
Moreover, the case-law of the Court of Justice of the European Union has also implicitly
acknowledged the need to respect the legitimate expectations of citizens covered by a statutory
provision, for example, in the Judgement of 15 July 2004 in Case C-459/02 – Willy Gerekens
Procol and Association agricole pour la promotion de la commercialisation laitière Procola
v. State of the Grand Duchy of Luxembourg, paragraphs 23 and 24, or the Judgement of 29
June 2010 in Case C-550/09 – Criminal proceedings against E. and F., paragraph 59.
The Court subsequently found that the legislative amendments generated discrimination
in terms of the legal treatment applicable to persons in similar legal situations. The mere fact –
the late settlement of the notifications by the entities entrusted by law or the final settlement of
the cases pending before courts covered by the provisions of Article 1 (2) of Law no. 165/2013,
as originally drafted – cannot constitute an argument justifying, objectively and reasonably, a
different legal treatment applied to persons entitled to redress by compensation with another
property offered in equivalent, leading to the breach of Article 16 (1) of the Constitution.
On the other hand, the Court did not accept the plea alleging a breach of the principle
of non-retroactivity of civil law, since the provision has produced legal effects solely during its
time of action (20 May 2013 to 24 December 2013), without generating any changes with
regard to legal relationships consumed/entered under the authority of res judicata before its
entry into force.
IV. For all of these reasons, by a majority vote, the Court upheld the exception of
unconstitutionality and found that the second sentence of Article 4 compared to Article 1 (2)
of Law no. 165/2013 on measures to finalise the process of restitution, in kind or by equivalent,
of property wrongfully confiscated under the Communist regime in Romania, in the wording
prior to the amendment of these provisions by Law no. 368/2013 amending and supplementing
Law no. 165/2013 were unconstitutional.