B. Compliance with Article 1 of Protocol No. 1
1. Applicable rules in Article 1 of Protocol No. 1
157. 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, inter alia, 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 D. Meyer (see, among other authorities, James and Others v. the United Kingdom , 21 February 1986, §37, Series A no. 98, which reiterates in part the principles laid down by the Court in Sporrong and Lönnroth v. Sweden , 23 September 1982, §61, Series A no. 52; see also Broniowski v. Poland [GC], no. 31443/96, § 134, ECHR 2004-V).
2. The parties’ submissions
158. The applicant relied on the arguments that she had submitted to the Chamber. In her view, the impugned restrictions had gone beyond what could be considered mere “control of the use of property”. Their continued application for many years had resulted in essential elements of her right of property being practically extinguished. In fact, she had been an owner only “on paper”. She did not have the possibility to decide who would live in her house and for how long. The lease of the flats had been imposed on her by unlawful administrative decisions but, despite that fact, she could not terminate the lease agreements and regain possession of her house because the statutory conditions attached to the termination of leases, including the duty to provide a tenant with substitute accommodation, made it impossible in practice to do so.
The applicant further stressed that she had had no influence whatsoever on the amount of rent paid by her tenants. Indeed, under the contested laws the levels of rent were fixed without any reasonable relationship to the costs of maintaining property in good condition. This had resulted in a significant depreciation in the value and condition of her own house. In her submission, the cumulative effect of all those factors had brought about a situation similar to expropriation.
159. The Government disagreed and asked the Court to uphold the Chamber’s finding that the alleged interference had amounted to the control of the use of property within the meaning of the second paragraph of Article 1 of Protocol No. 1. They pointed out that the applicant had never lost her right to the “peaceful enjoyment” of her property. Since 25 October 1990, when the Gdynia District Court had entered her title in the relevant land register, she had enjoyed all the attributes of a property owner. She had a right to use, to dispose of, to pledge, to lend and even to destroy her property. The measures adopted, in particular the limitations on the level of rent chargeable, had therefore only amounted to a control of the use of the applicant’s property.
3. The Court’s conclusion
160. The Chamber shared the Government’s point of view (see paragraph 145 of the Chamber judgment).
It noted that, while it was true that the applicant could not exercise her right of use in terms of physical possession as the house had been occupied by tenants and that her rights in respect of letting the flats, including her right to receive rent and to terminate leases, had been subject to a number of legal restrictions, she had 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 opinion, those issues concerned the degree of the State’s interference, and not its nature. All the measures taken, whose aim was to subject the applicant’s house to continued tenancy and not to take it away from her permanently, could not be considered a formal or even de facto expropriation but constituted a means of State control of the use of her property.
The Chamber therefore concluded that the case should be examined under the second paragraph of Article 1 of Protocol No. 1 (see Mellacher and Others v. Austria, 19 December 1989, § 44, Series A no. 169, and Immobiliare Saffi v. Italy [GC], no. 22774/93, § 46, ECHR 1999-V).
161. The Grand Chamber fully agrees with the Chamber’s assessment.
4. General principles deriving from the Court’s case-law
162. The Court will consider the case in the light of the following principles.
(a) Principle of lawfulness
163. The first and most important requirement of Article 1 of Protocol No. 1 is that any interference by a public authority with the peaceful enjoyment of possessions should be lawful. In particular, the second paragraph of Article 1, while recognising that States have the right to control the use of property, subjects their right to the condition that it be exercised by enforcing “laws”. Moreover, the principle of lawfulness presupposes that the applicable provisions of domestic law are sufficiently accessible, precise and foreseeable in their application (see, mutatis mutandis, Broniowski, cited above, § 147, with further references).
60. The Court is unable to accept this argument.
Although the expropriation permits left intact in law the owners’ right to use and dispose of their possessions, they nevertheless in practice significantly reduced the possibility of its exercise. They also affected the very substance of ownership in that they recognised before the event that any expropriation would be lawful and authorised the City of Stockholm to expropriate whenever it found it expedient to do so. The applicants’ right of property thus became precarious and defeasible.
The prohibitions on construction, for their part, undoubtedly restricted the applicants’ right to use their possessions.
The Court also considers that the permits and prohibitions should in principle be examined together, except to the extent that analysis of the case may require a distinction to be drawn between them. This is because, even though there was not necessarily a legal connection between the measures (see paragraph 35 above) and even though they had different periods of validity, they were complementary and had the single objective of facilitating the development of the city in accordance with the successive plans prepared for this purpose.
There was therefore an interference with the applicants’ right of property and, as the Commission rightly pointed out, the consequences of that interference were undoubtedly rendered more serious by the combined use, over a long period of time, of expropriation permits and prohibitions on construction.
2. The justification for the interference with the applicants’ right of property
61. It remains to be ascertained whether or not the interference found by the Court violated Article 1 (P1-1).
That Article (P1-1) comprises three distinct rules. The first rule, which is of a general nature, enounces the principle of peaceful enjoyment of property; it is set out in the first sentence of the first paragraph. The second rule covers deprivation of possessions and subjects it to certain conditions; it appears in the second sentence of the same paragraph. The third rule recognises that the States are entitled, amongst other things, to control the use of property in accordance with the general interest, by enforcing such laws as they deem necessary for the purpose; it is contained in the second paragraph.
The Court must determine, before considering whether the first rule was complied with, whether the last two are applicable.
(a) The applicability of the second sentence of the first paragraph
62. It should be recalled first of all that the Swedish authorities did not proceed to an expropriation of the applicants’ properties. The applicants were therefore not formally "deprived of their possessions" at any time: they were entitled to use, sell, devise, donate or mortgage their properties.
63. In the absence of a formal expropriation, that is to say a transfer of ownership, the Court considers that it must look behind the appearances and investigate the realities of the situation complained of (see, mutatis mutandis, the Van Droogenbroeck judgment of 24 June 1982, Series A no. 50, p. 20, par. 38). Since the Convention is intended to guarantee rights that are "practical and effective" (see the Airey judgment of 9 October 1979, Series A no. 32, p. 12, par. 24), it has to be ascertained whether that situation amounted to a de facto expropriation, as was argued by the applicants.
38. Be that as it may, one must look beyond the appearances and the language used and concentrate on the realities of the situation (see notably, mutatis mutandis, the Deweer judgment of 27 February 1980, Series A no. 35, p. 23, par. 44).
This is a matter in which the Government enjoy a wide measure of discretion. Case-law and practice certainly confirm the meaning suggested by the text of section 25 of the 1964 Act ("if necessary") and the actual phrase "placing at disposal". In a judgment of 4 April 1978, the Belgian Court of Cassation observed that "execution of the penalty" in question "is to a large extent a matter for the discretion" of the Minister of Justice (Pasicrisie 1978, I, p. 861). One finds that far less fetters are imposed on Ministerial decisions by a court’s decision to apply the Social Protection Act than in the analogous area of the system of placing vagrants "at the Government’s disposal" (Act of 27 November 1891; see the De Wilde, Ooms and Versyp judgment of 18 June 1971, Series A no. 12, pp. 24-25, par. 37, and pp. 33-34, par. 61). In short, to adopt the language used by the Commission’s Delegate, "the court decision does not order the detention" of recidivists and habitual offenders: it "authorises" it.
44. However, the prominent place held in a democratic society by the right to a fair trial (see especially the above-mentioned Airey judgment, pp. 12-13, par. 24) prompts the Court to prefer a "substantive", rather than a "formal", conception of the "charge" contemplated by Article 6 par. 1 (art. 6-1). The Court is compelled to look behind the appearances and investigate the realities of the procedure in question.