Case No. 16/06-69/06-10/07
THE CONSTITUTIONAL COURT OF THE REPUBLIC OF LITHUANIA
RULING
ON THE COMPLIANCE OF PARAGRAPH 2 OF ARTICLE 4.96 OF THE
CIVIL CODE OF THE REPUBLIC OF LITHUANIA WITH THE
CONSTITUTION OF THE REPUBLIC OF LITHUANIA
30 October 2008
Vilnius
The Constitutional Court of the Republic of Lithuania,
composed of the Justices of the Constitutional Court Armanas
Abramavičius, Toma Birmontienė, Pranas Kuconis, Kęstutis
Lapinskas, Zenonas Namavičius, Ramutė Ruškytė, Egidijus Šileikis,
Algirdas Taminskas and Romualdas Kęstutis Urbaitis,
with the secretary of the hearingDaiva Pitrėnaitė,
pursuant to Articles 102 and 105 of the Constitution of the
Republic of Lithuania and Article 1 of the Law on the
Constitutional Court of the Republic of Lithuania, in its public
hearing on 15 October 2008 heard constitutional justice case No.
16/06-69/06-10/07 subsequent to the following:
(1) the petition of a group of Members of the Seimas,
consisting of Bronius Bradauskas, Juozas Palionis, Gintautas
Mikolaitis, Vytautas Saulis, Algirdas Butkevičius, Algimantas
Salamakinas, Jonas Juozapaitis, Edvardas Žakaris, Bronius Pauža,
Vytautas Kamblevičius, Virginijus Domarkas, Saulius Bucevičius,
Zenonas Mikutis, Valentinas Bukauskas, Vytautas Sigitas
Draugelis, Saulius Girdauskas, Antanas Bosas, Loreta Graužinienė,
Vydas Gedvilas, Rimantas Bašys, Petras Baguška, Kęstutis
Glaveckas, Valentinas Mazuronis, Remigijus Ačas, Vytautas
Galvonas, Raimundas Palaitis, Jonas Čekuolis, Liudvikas Sabutis,
Eligijus Masiulis, Andrius Endzinas and Milda Petrauskienė, a
petitioner, requesting to investigate whether Paragraph 2 of
Article 4.96 of the Civil Code of the Republic of Lithuania is
not in conflict with Article 23 and Paragraph 1 of Article 29 of
the Constitution of the Republic of Lithuania and with the
principle of a state under the rule of law which, according to
the petitioner, is enshrined in the Preamble to the Constitution
of the Republic of Lithuania (petition No. 1B-14/2006);
(2) the petition of the Vilnius Regional Court, a
petitioner, requesting to investigate whether Paragraph 2 of
Article 4.96 of the Civil Code of the Republic of Lithuania, to
the extent that the state is allowed to retrieve the immovable
property from an acquirer in good faith which has been lost due
to a crime committed by a state servant is not in conflict with
Article 23 and Paragraph 1 of Article 29 of the Constitution of
the Republic of Lithuania and with the principle of a state under
the rule of law which, according to the petitioner, is enshrined
in the Preamble to the Constitution of the Republic of Lithuania
(petition No. 1B-76/2006);
(3) the petition of the Court of Appeal of Lithuania, a
petitioner, requesting to investigate whether Paragraph 2 of
Article 4.96 of the Civil Code of the Republic of Lithuania is
not in conflict with Article 23 and Paragraph 1 of Article 29 of
the Constitution of the Republic of Lithuania and with the
constitutional principle of a state under the rule of law which,
according to the petitioner, is enshrined in the Preamble to the
Constitution of the Republic of Lithuania (petition No. 1B-11/
2007).
By the Constitutional Court decision of 18 September 2007
these petitions were joined into one case and it was given
reference No. 16/06-69/06-10/07.
The Constitutional Court
has established:
I
1. A group of Members of the Seimas, the petitioner, applied
to the Constitutional Court with a petition requesting to
investigate whether Paragraph 2 of Article 4.96 of the Civil Code
is not in conflict with Article 23 and Paragraph 1 of Article 29
of the Constitution and with the principle of a state under the
rule of law which, according to the petitioner, is enshrined in
the Preamble to the Constitution (petition No. 1B-14/2006).
2. The Vilnius Regional Court, the petitioner, was
investigating a civil case. By its ruling, the said court
suspended the consideration of the case and applied to the
Constitutional Court with the petition requesting to investigate
whether Paragraph 2 of Article 4.96 of the Civil Code, to the
extent that the state is allowed to retrieve the immovable
property from an acquirer in good faith which has been lost due
to a crime committed by a state servant, is not in conflict with
Article 23 and Paragraph 1 of Article 29 of the Constitution and
with the principle of a state under the rule of law which,
according to the petitioner, is enshrined in the Preamble to the
Constitution (petition No. 1B-76/2006).
3. The Court of Appeal of Lithuania, a petitioner, was
investigating a civil case. By its ruling, the said court
suspended the consideration of the case and applied to the
Constitutional Court with the petition requesting to investigate
whether Paragraph 2 of Article 4.96 of the Civil Code is not in
conflict with Article 23 and Paragraph 1 of Article 29 of the
Constitution and with the constitutional principle of a state
under the rule of law which, according to the petitioner, is
enshrined in the Preamble to the Constitution (petition No. 1B-
11/2007).
II
The petitions of the petitioners are based on the following
arguments.
1. By the disputed legal regulation, the rights of the owner
who lost an item due to a crime committed by a person are
defended more than of the acquirer in good faith who, according
to the petitioners, also becomes an "equal" owner of this item.
Under Article 4.96 of the Civil Code, a person, who did not know
and could not know that the item was acquired upon payment from a
person who had no right to transfer this property shall be
considered as an acquirer in good faith. Good faith is a
fundamental principle of private law. The analysis of the
disputed provision of the Civil Code permits stating that even
though the acquirer of the immovable property who has acquired
the item by transaction also becomes its owner, the rights of the
initial owner, according to the existing legal regulation, are in
such case assessed by priority. Neither the owner of the item nor
the acquirer in good faith is equally responsible for the crime
due to which the owner has lost the item. The item may be
demanded and obtained from the acquirer in good faith regardless
of his legitimate expectations, possible improvements of the
item, etc. Thus, the situation of two "equal" owners is different
and by such legal regulation the constitutional principle of
equal rights of all persons is violated.
2. While demanding and obtaining the immovable items from
the acquirer in good faith under Paragraph 2 of Article 4.96 of
the Civil Code, the needs of society are not satisfied and the
acquirer in good faith is not justly compensated for. Under
Article 23 of the Constitution, property shall be inviolable and
may be taken over only for the needs of society according to the
procedure established by law and shall be justly compensated for,
thus, by the disputed legal regulation, one violates the rights
of ownership of a person.
3. In addition, the Vilnius Regional Court, the petitioner,
requesting to investigate whether Paragraph 2 of Article 4.96 of
the Civil Code to the extent that the state is allowed to
retrieve the immovable property from an acquirer in good faith
which has been lost due to a crime committed by a state servant
is not in conflict with the Constitution is additionally grounded
on the fact that a state servant is a person authorised by the
state, therefore, if the state has lost an immovable item due to
criminal actions committed by its authorised persona state
servantthe rights of the state as the owner may not be defended
more than the rights of the acquirer in good faith of this item.
III
In the course of the preparation of the case for the
Constitutional Court hearing, written explanations from Gediminas
Sagatys, the representative of the Seimas, the party concerned,
were received in which it is stated that Paragraph 2 of Article
4.96 of the Civil Code is not in conflict with the Constitution.
The position of the Seimas, the party concerned, is based on the
following arguments.
1. When one construes the legal regulation enshrined (inter
alia disputed) in Article 4.96 of the Civil Code in a systemic
manner, it is to be assessed as detailing the provisions of
Articles 23 and 46 of the Constitution regarding the duty of the
state to ensure the inviolability of property and to regulate the
economic activity so that it would serve the general welfare of
the Nation. Under the Constitution, the state is not obliged to
recognise and defend the right of ownership to the property which
was acquired (which was gained possession of) by a person without
a clearly expressed will (consent) of the owner of this property.
Transferring of the right of ownership without the consent of the
owner is possible only in the exceptional cases provided for in
Article 23 of the Constitution.
2. A person may acquire the right of ownership only
lawfully. What is acquired unlawfully and in violation of the
rights of other persons and legal norms may not be defended. One
may not defend a violation of law. While grounding his position
that the disputed legal regulation is not in conflict with
Paragraph 1 of Article 29 of the Constitution, the representative
of the Seimas, the party concerned, refers to the official
constitutional doctrine set forth in the Constitutional Court
ruling of 5 July 2000 whereby the Constitution guarantees the
protection of property; property acquired unlawfully does not
become property of the person who has acquired it, therefore,
such a person does not acquire the rights of ownership which are
protected by the Constitution. Thus, under the Constitution, "the
collision of the rights of two lawful owners in good faith of one
item is impossible". The right of ownership of the owner to the
immovable item does not disappear if he loses the possibility to
own this item in reality due to the crime committed by other
persons, it may not be transferred and it does not devolve to
other persons irrespective of their subjective characteristics
(regardless of whether they are in good faith or not in good
faith) or kinds of the transaction (payable or non-payable). The
acquirer, to whom such item was transferred, acquires not the
right of ownership, but only the right to own the item. Such
interpretation of the legal regulation allows one to avoid the
problem of dualism of the owners of the same item.
3. The representative of the Seimas, the party concerned,
also specified the provision linked to the legal regulation
enshrined in Article 143 of the Civil Code of 7 July 1964 which
was valid until 1 July 2001 (under which, if the property has
been acquired upon payment from a person who had no right to
transfer from a person and the acquirer did not know that and
could not know that (acquirer in good faith), the owner shall
have the right to demand and obtain this property from the
acquirer only in the case when the property has been lost by a
person, to whom the owner transferred it to own or from whom it
was seized or stopped being owned by them irrespective of their
will) of the Constitutional Court ruling of 8 April 1997 in
which, according to the representative of the petitioner, the
essentially analogous situation is construed. In the said ruling
it was held that the mere fact that owner has the right to demand
and obtain the property from its acquirer in good faith providing
the owner or another person to whom the owner has transferred it
for possession has been lost or seized from either of them or
otherwise ceased to be possessed irrespective of their will is "a
universally recognised rule of protection of the right of
ownership".
IV
In the course of the preparation of the case for the
Constitutional Court hearing, written explanations from Paulius
Koverovas, State Secretary of the Ministry of Justice of the
Republic of Lithuania, and Algimantas Čepas, Director of the
Institute of Law, were received.
The Constitutional Court
holds that:
I
1. Paragraph 2 of Article 4.96 of the Civil Code provides:
"Immovable item may not be demanded and obtained from an acquirer
in good faith with the exception of cases when the owner has lost
such item due to a crime committed by other persons."
The group of Members of the Seimas and the Court of Appeal
of Lithuania, petitioners, request to investigate whether
Paragraph 2 of Article 4.96 of the Civil Code, and the Vilnius
Administrative Court, a petitioner, request to investigate
whether Paragraph 2 of Article 4.96 of the Civil Code, to the
extent that the state is allowed to retrieve the immovable
property from an acquirer in good faith which has been lost due
to a crime committed by a state servant, are not in conflict with
the Constitution.
It needs to be held that Paragraph 2 of Article 4.96 of the
Civil Code, the investigation of the compliance of which with the
Constitution is requested by the group of Members of the Seimas
and the Court of Appeal of Lithuania, petitioners, includes
Paragraph 2 of Article 4.96 of the Civil Code to that extent that
the state is allowed to retrieve the immovable property from an
acquirer in good faith which has been lost due to a crime
committed by a state servant, the investigation of the compliance
of which with the Constitution is requested by the Vilnius
Regional Court, a petitioner. Therefore, in all the said
petitions to the Constitutional Court, one requests to
investigate the compliance of the same legal regulationParagraph
2 of Article 4.96 of the Civil Codewith the Constitution.
2. The petitioners request to investigate whether the
disputed legal regulation is not in conflict inter alia with the
principle of a state under the rule of law which, according to
them, is enshrined in the Preamble to the Constitution. The
Constitutional Court has held in its acts more than once that it
is impossible to identify the constitutional principle of a state
under the rule of law only as one which is enshrined in the
Preamble to the Constitution, that the constitutional principle
of a state under the rule of law integrates various values
consolidated in and protected and defended by the Constitution
and includes many interrelated imperatives. Therefore, the
request of the petitioners to investigate the compliance of the
disputed legal regulation inter alia with the principle of a
state under the rule of law which, according to them, is
enshrined in the Preamble to the Constitution, is to be
considered as the request to investigate the compliance of the
disputed legal regulation inter alia with the constitutional
principle of a state under the rule of law.
3. Thus, in this constitutional justice case, the
Constitutional Court will investigate whether Paragraph 2 of
Article 4.96 of the Civil Code is not in conflict with Article 23
and Paragraph 1 of Article 29 of the Constitution and with the
constitutional principle of a state under the rule of law.
II
1. The legal regulation disputed by the petitioner is
designed to regulate the relations linked to the defence of
rights of the owner who lost an item due to a crime committed by
other persons, as well as interaction (conflict) of the rights
and interests of the owner and the acquirer (of his property) in
good faith.
Thus, in this constitutional justice case the investigation
of the compliance of the disputed provision with the Constitution
implies that one must elucidate, on the one hand, what
requirements which stem from the Constitution must be heeded
while regulating the relations of property linked to defence of
the rights of the owner by legal acts, inter alia when the owner
loses his property due to a crime committed by other persons,
and, on the other hand, whether according to the Constitution,
one may demand and obtain the property from the acquirer in good
faith which was lost by the owner due to a crime committed by
other persons and, in case one may do so, what guarantees of the
rights of the acquirer in good faith stem from the Constitution.
2. It has been mentioned that the Constitutional Court is
requested to investigate the compliance of Paragraph 2 of Article
4.96 of the Civil Code with Article 23 and Paragraph 1 of Article
29 of the Constitution and with the constitutional principle of a
state under the rule of law.
3. Article 23 of the Constitution provides:
"Property shall be inviolable.
The rights of ownership shall be protected by laws.
Property may be taken over only for the needs of society
according to the procedure established by law and shall be justly
compensated for".
3.1. The provisions of Article 23 of the Constitution, which
constitute a whole, reveal the essence of the protection of the
rights of ownership (Constitutional Court ruling of 27 May 2002).
The Constitutional Court has held in its acts more than once that
Article 23 of the Constitution enshrines the principle of
inviolability of property. Under the Constitution, the owner has
the right to perform any actions in regard of his property, save
those prohibited by the law, as well as to use his property and
determine its future in any way, which does not violate the
rights and freedoms of other persons (Constitutional Court
rulings of 14 March 2006 and 20 May 2008). On the other hand, the
Constitutional Court, while construing the provisions of Article
23 of the Constitution, has more than once held that ownership
includes obligations. When using his property, the owner must
behave responsibly and carefully.
Under the Constitution, other persons must not violate these
rights of the owner, while the state is under obligation to
defend and protect property against unlawful encroachment upon it
and from other violations. Nobody may seize property arbitrarily
and on other than legal basis. The right to demand that other
persons do not violate his right of ownership and that the state
ensures the protection of his ownership rights is guaranteed by
the Constitution to the subject of ownership-the owner
(Constitutional Court ruling of 8 July 2005).
3.2. In the context of the constitutional justice case at
issue, it needs to be noted that the constitutional principle of
inviolability of property would be denied also if after the owner
has lost his property due to a crime committed by another person
(other persons), the rights of ownership of the owner would not
be defended. In this context it needs to be noted that when the
owner loses his property due to a crime committed by another
person (other persons), it does not mean that he loses the rights
of ownership and it does not mean that a person, who acquired
such property, becomes the owner of such property. As the
Constitutional Court has held, the duty arises for the legislator
from Article 23 of the Constitution, inter alia Paragraph 2
thereof, to regulate the ownership relations so that the rights
of ownership would be protected and defended and that the
inviolability of property would be ensured (Constitutional Court
ruling of 23 August 2005); the state is under obligation to issue
respective laws protecting the rights of ownership and to protect
ownership on their basis (Constitutional Court ruling of 14 March
2006). Under the Constitution, the owner shall have the right to
retrieve his property when he lost such property due to a crime
committed by another person (other persons); such his right is an
important constitutional guarantee of protection of the rights of
ownership. It implies the duty of the legislator to establish
such legal regulation which would ensure defence of the rights of
ownership of the owner who has lost property due to a crime
committed by another person (other persons). While establishing
it, the legislator must establish how the defence of the rights
of ownership of the owner must be ensured, inter alia when such
property cannot be returned due to objective reasons and there
are no possibilities to return it in kind.
3.3. The Constitution, while guaranteeing the protection of
ownership, establishes the constitutional right to acquisition of
property too, and guarantees protection of this right
(Constitutional Court ruling of 14 March 2002). Under the
Constitution, the ways of acquisition of the right of ownership
may be varied ones, however, they may not be in conflict with the
requirements which stem from the Constitution, inter alia the
principles of justice and good faith.
The legislator, while heeding the norms and principles of
the Constitution, must establish the ways and grounds for
acquisition of the right of ownership. It implies the requirement
of lawfulness of the acquisition of property. Under the
Constitution, one of the essential conditions of lawfulness of
transferring the object of ownership (property) to ownership of
another person (other persons) is the expression of the resolve
(consent) of the owner regarding such transferring of the object
of ownership (property) to ownership of other person (other
persons). When the property is transferred to another person
without the expression of the resolve (consent) of the owner,
such transferring of property is considered as unlawful and the
transferred propertyas property acquired unlawfully by another
person, unless the transferring of property to ownership of
another person (other persons) without the expression of the
resolve (consent) of the owner of this property would be
constitutionally justified.
Property acquired unlawfully does not become property of the
person who has acquired it. Thus such a person does not acquire
the rights of ownership which are protected by the Constitution
(Constitutional Court ruling of 5 July 2000).
3.4. In this context, it needs to be noted that such
situation is possible, where a person acquired property knowing
or having to know that the person from whom such property is
acquired does not have the right to transfer that property to
ownership. Such acquisition of property does not create the
rights of ownership to its acquirer. Taking account of the said
fact, it needs to be noted that the Constitution does not defend
also the rights of such person, who acquires property which has
been lost by the owner due to a crime committed by another person
(other persons), and he knows or has to know about it, i.e. he
acquires the property while behaving not in good faith and
unlawfully.
Also such situation is possible, where a person, who seeks
to acquire property lawfully, acquires the property which has
been lost by the owner due to a crime committed by another person
(other persons) while the person, when acquiring it, did not know
that and could not know that. In the context of the
constitutional justice case at issue, it needs to be noted that
even in such case when a person acquires property without knowing
or without being able to know that the owner lost it due to a
crime committed by another person (other persons), the
acquisition of such property may not be treated in itself as
creating the rights of ownership to the acquirer of the property.
As the Constitutional Court has held more than once, no right can
appear on the grounds of unlawfulness.
3.5. While regulating the protection of the rights of
ownership, the legislator must ensure the balance of values
defended in and protected by the Constitution. The fact that the
rights of ownership of the owner who has lost his property due to
a crime committed by another person (other persons) must be
defended does not mean that one does not have to defend the
rights of also such a person who sought to acquire property
lawfully and in good faith but who acquired it without knowing
that the owner had lost that property due to a crime committed by
another person (other persons). The requirement to defend the
rights of such person stems from the Constitution, inter alia the
constitutional principle of a state under the rule of law and the
constitutional principle of compensation for damage which is
enshrined in Article 30 of the Constitution. This constitutional
principle is inseparable from the principle of justice entrenched
in the Constitution: all the necessary legal preconditions must
be created by laws in order to justly compensate for the
inflicted damage (Constitutional Court ruling of 19 August 2006).
The requirement to defend the rights of a person, who
acquired property in good faith which had been lost by the owner
due to a crime committed by another person (other persons) stems
from Article 46 of the Constitution, inter alia Paragraph 1
thereof, which also enshrines freedom of individual economic
activity and initiative which imply freedom of concluding
agreements.
3.6. Under Paragraph 3 of Article 23 of the Constitution,
property may be taken over from the owner only when it is
necessary for the needs of society and when it is justly
compensated for; the property can be taken over for the needs of
society where it is justly compensated for only according to the
procedure established by law. As the Constitutional Court has
held, Paragraph 3 of Article 23 of the Constitution indicates the
needs of society, for which property may be seized according to
the procedure established by law and must be adequately
compensated for. The said needs are interests of either the whole
or part of society. The state, while implementing its functions,
is constitutionally obligated to secure and satisfy such
interests. When property is seized for the needs of society, one
must strive for the balance between various legitimate interests
of society and its members. The needs of society, for which
property is seized, are always particular and clearly expressed
needs of society for a concrete object of property. It is
permitted to seize property (by adequately compensating for) only
for such public needs which would not be objectively met if a
certain concrete object of property were not seized. The person
whose property is being seized for the needs of society has the
right to demand that the established compensation be equivalent
in value for the property seized (Constitutional Court rulings of
2 April 2001, 4 March 2003 and 20 May 2008).
In the context of the constitutional justice case at issue
it needs to be noted that the imperatives which stem from
Paragraph 3 of Article 23 of the Constitution are not applied for
seizing of property from its owner in such cases when the owner
retrieves the property lost due to a crime committed by another
person (other persons).
3.7. The provisions of Article 23 of the Constitution
guarantee the protection of property for all its owners, i.e.
natural persons, legal persons, municipalities and the state
(Constitutional Court ruling of 27 May 2002). Therefore, under
the Constitution, laws have to protect the rights of ownership of
all the owners, inter alia also the right of the state (as the
organisation of the entire society).
Under the Constitution, the state is a subject of the right
of ownership (Constitutional Court rulings of 27 May 2002 and 30
September 2003). The Constitutional Court has held more than once
that the state is the organisation of the entire society. While
discharging its functions, the state must act in the interests of
society (Constitutional Court rulings of 4 March 2003 and 13
December 2004).
The property that belongs to the state by right of ownership
has to be possessed in such a way that it would serve the common
welfare of the nation, and the general interest of the whole
society. The state-owned property is one of the means for
guaranteeing the public interest, and social harmony.
Institutions of state authority and other state institutions
which are empowered to adopt decisions concerning the possession,
use and disposal of the property which belongs to the state by
right of ownership, are not themselves the owners of that
propertyit belongs to the entire state. Therefore all state
institutions which have the powers to adopt decisions concerning
the possession, use and disposal of the property that belongs to
the state by right of ownership, must observe the norms and
principles of the Constitution (Constitutional Court ruling of 30
September 2003).
It needs to be noted that state institutions, while adopting
decisions regarding possession, use and disposal of property
which belongs to the state by right of ownership, must follow the
norms and principles of the Constitution and under no
circumstances may they act ultra vires, i.e. by exceeding their
powers. The acting ultra vires by state institutions or officials
may not be identified, without reservations, with the acting by
the state itself. In the context of the constitutional justice
case at issue it needs to be noted that if state officials, when
acting ultra vires, commit a crime, it does not mean that such
their criminal deed may be identified with action (failure to
act) of the state itself and the state, as the owner, may not
retrieve the property which has been lost due to a crime
committed by a state official.
It also needs to be noted that in the cases when damage was
inflicted upon a person by unlawful actions of the state
institutions or actions of the officials, this person, under the
Constitution, has the right to claim for just compensation for
this damage in court.
As the Constitutional Court held in its ruling of 19 August
2006, if the law, let alone other legal act, established such
legal regulation whereby the state would fully or partially avoid
the duty to justly compensate for material and/or moral damage
inflicted by unlawful actions of state institution or officials,
it would mean not only that the constitutional concept of
compensation for damage is disregarded and that this is not line
with the Constitution (inter alia Paragraph 2 of Article 30
thereof), but it would also undermine the raison d'?tre of the
state itself, as the common good of the whole society.
In this context it needs to be noted that the situations may
occur when the state for certain reasons temporarily in fact
possesses and uses the property which does not belong to it by
right of ownership (Constitutional Court ruling of 30 September
2003). The Constitutional Court has held in its acts more than
once that on the grounds of arbitrary acts of the occupation
government could not appear, nor did appear any lawful state or
public property, since no law (right) can appear on the basis of
unlawfulness, thus the property seized from the people in such
manner is to be regarded only as property which is in fact
possessed by the state. In such a situation, where the state in
fact temporarily possesses and uses the property which does not
belong to it by right of ownership, the said property must also
be possessed and used by heeding the same constitutional
requirements as in the possession and usage of property which
belongs to the state by right of ownership (Constitutional Court
rulings of 30 September 2003 and 5 July 2007). In this case the
guarantees of protection of the right of ownership which stem
from Article 23 of the Constitution are also applied.
4. Paragraph 1 of Article 29 of the Constitution provides:
"All persons shall be equal before the law, the court, and other
State institutions and officials."
The Constitutional Court has held in its acts more than once
that the constitutional principle of equality of persons before
the law enshrines formal equality of all persons, that it obliges
to legally assess equal facts in the same manner and prohibits to
arbitrarily assess essentially the same facts differently, that
it does not permit to discriminate persons or to grant them
privileges, however, it does not deny the possibility to
establish, by means of a law, different (differentiated) legal
regulation with regard to persons of certain categories who are
in different situations. The constitutional principle of equality
of persons does not deny the possibility to treat persons
differently by taking account of their status and situation. The
problem of equality of persons in the laws may not be properly
decided in each situation without assessing whether the
peculiarities of legal regulation are established reasonably with
regard to them (Constitutional Court rulings of 13 November 1997,
23 October 2002 and 30 June 2008).
II
On the compliance of Paragraph 2 of Article 4.96 of the
Civil Code with Article 23 and Paragraph 1 of Article 29 of the
Constitution and with the constitutional principle of a state
under the rule of law.
1. It has been mentioned that the Constitutional Court is
requested to investigate the compliance of Paragraph 2 of Article
4.96 of the Civil Code, in which it is established that the
immovable item may not be demanded and obtained from an acquirer
in good faith with the exception of cases when the owner had lost
such item due to a crime committed by other persons, with Article
23 and Paragraph 1 of Article 29 of the Constitution and with the
constitutional principle of a state under the rule of law.
2. On 18 July 2000, the Seimas adopted the Republic of
Lithuania Law on Confirmation, Entry into Effect and
Implementation of the Civil Code by Article 1 of which it
confirmed a new Civil Code. In Article 2 of this law, it was
established that "the Civil Code shall come into effect as from 1
July 2001 with the exception of those provisions of the Code, the
terms of coming into effect of which are established by this
law." The specified reservation "with the exception of those
provisions of the Code, the terms of coming into effect of which
are established by this law" did not include Article 4.96 of the
Civil Code, inter alia Paragraph 2 thereof disputed by the
petitioners. Thus, the provision of the Civil Code which is
disputed by the petitioners came into effect on 1 July 2001.
Article 4.96 titled "Demanding and Obtaining of an Item from
an Acquirer in Good Faith" of the Civil Code provides:
"1. If a movable item was acquired upon payment from a
person who had no right to transfer this property, and the
acquirer did not and could not know this (acquirer in good
faith), the owner shall have the right to demand and obtain the
item from the acquirer only if the item belongs to the owner or
to a person to whom the owner had given it into possession, if
the item was lost or stolen from one of these, or if it stopped
being in their possession against their will. The owner may claim
these demands within three years from the moment of the loss of
the item.
2. An immovable item may not be demanded and obtained from
an acquirer in good faith with the exception of cases when the
owner has lost such item due to a crime committed by other
persons.
3. If an item was acquired without recompense from a person
who had no right to transfer its ownership, the owner shall have
the right to demand and obtain the item in all cases. This rule
shall apply to movable as well as immovable items.
4. The rules of this article shall not apply when the item
was sold or otherwise transferred in compliance with a procedure
for the enforcement of court decisions."
Even though the Civil Code has been amended and supplemented
more than once, Article 4.96 thereof, inter alia disputed
Paragraph 2 of the same article, has not been amended or
supplemented.
3. The Civil Code, inter alia Article 4.96 thereof,
Paragraph 2 of which is disputed by the petitioners, consolidates
the institute of vindicationthe requirement for the owner who
does not possess his item to return the item which is possessed
unlawfullywhich was known as far back as in Roman Law. Borrowing
the Roman Law, this institute, as one of the institutes of
defence of the rights of the owner, became naturalised also in
the civil law of other states (such as France, Italy, etc.). This
institute was also known in the civil law of the interwar
Lithuania.
4. The legal regulation disputed by the petitioner which is
designed to defend the rights of the owner when he has lost
property due to a crime committed by other persons, is to be
construed, in a systemic manner, in the context of the
corresponding provisions of the Civil Code.
4.1. Article 4.95 of the Civil Code provides that the owner
shall have the right to demand and obtain an item from the
extraneous unlawful possession. Article 4.96 of the Civil Code
establishes the conditions under which the owner has the right to
demand and obtain his item from the extraneous unlawful
possession when the acquirer of such item is in good faith. Under
the legal regulation established in Paragraphs 1 and 2 of this
article which enshrined the institute of limited vindication, an
item (movable and immovable) shall be returned to the owner from
the acquirer in good faith only in certain cases. Under Paragraph
3 of Article 4.96 of the Civil Code, if an item was acquired
without recompense from a person who had no right to transfer its
ownership, the owner shall have the right to demand and obtain
the item in all cases, i.e. this paragraph enshrines unlimited
vindication.
Paragraph 2 of Article 4.96 of the Civil Code, whose
compliance with the Constitution is doubted by the petitioners,
consolidates the institute of limited vindication. Under
Paragraph 2 of Article 4.96 of the Civil Code, an immovable item
may be demanded and obtained from an acquirer in good faith if
the owner had lost such item due to a crime committed by other
persons.
4.2. While construing the disputed legal regulation in the
context of this constitutional justice case, it is important to
reveal the concepts of the owner and the acquirer in good faith
according to the Civil Code.
4.2.1. The concept of the owner may be revealed in various
aspects (the owner as holder of the right of ownership and as
acquirer of the right of ownership) by construing the legal
regulation enshrined in most articles (paragraphs thereof) of the
Civil Code, inter alia Paragraph 1 of Article 4.37, Articles 4.
39, 4.47 and 4.48. When the concept of the owner in the context
of the constitutional justice case at issue is revealed, i.e.
when it is revealed in the aspect of the person who acquires the
right of ownership, a person, who lawfully acquired the right of
ownership on one of the grounds established in the Civil Code or
on the grounds which are not in conflict with this code, is
considered as the owner (Article 4.47 of the Civil Code).
Under Paragraph 1 of Article 4.93 of the Civil Code, the
Republic of Lithuania guarantees equal protection of the rights
for all owners.
4.2.2. The concept of the owner in good faith is in various
aspects revealed in various articles (paragraphs thereof) of the
Civil Code, inter alia Paragraph 3 ("Possession shall be deemed
to be in good faith when the person who takes possession is
convinced that nobody has more rights to the item that he is
taking over than himself") of Article 4.26 of the same code,
Paragraph 1 ("<...> item was acquired upon payment from a person
who had no right to transfer this property, and the acquirer did
not and could not know this (acquirer in good faith) <...>") of
Article 4.96 of the same code.
4.2.3. Natural and legal persons may be subjects of the
right of ownership, inter alia the state which participates in
the civil relations on the same grounds as other participants of
these relations (Article 2.36 of the Civil Code).
4.2.4. The grounds for acquisition of the right of ownership
are specified in Article 4.47 of the Civil Code (these are inter
alia contracts, other grounds established by the law). Under
Paragraph 2 of Article 4.23 of the Civil Code, possession of an
item shall be considered as lawful, when the item is acquired on
the same grounds as the right of ownership.
Under Paragraph 1 of Article 4.48 of the Civil Code, the
right of ownership may be transferred only by the owner or by a
person, who has been authorised to do so by the owner. Therefore,
in those cases when the item is acquired without the resolve of
the owner, save certain cases provided for in the Civil Code
(inter alia when the item has been sold or transferred otherwise
in compliance with the procedure for the enforcement of court
decisions (Paragraph 4 of Article 4.96 of the Civil Code)), the
acquisition of the item does not in itself mean also the
appearance of the right of ownership to that item, i.e. the
person who acquired that item (acquirer) does not become the
owner of that item, but he becomes only the actual possessor of
this item.
4.2.5. According to Paragraph 1 Article 4.26 of the Civil
Code, possession of an item may be lawful and unlawful. It needs
to be noted that the provision "possession of an item shall be
considered as lawful unless the opposite is proven" of Paragraph
2 of Article 4.23 of the Civil Code means the presumption of
lawfulness of possession. Possession of an item shall be
considered as lawful when the item is acquired on the same
grounds as the right of ownership (Paragraph 2 of Article 4.23 of
the Civil Code); possession of an item which was acquired by
force, in a clandestine manner or otherwise by violating legal
acts shall be considered as unlawful (Paragraph 3 of Article 4.23
of the Civil Code).
4.3. While construing the disputed legal regulation in a
systemic manner in the context of the Civil Code, inter alia in
the context of the aforesaid articles, one is to draw a
conclusion that the owner is considered as a lawful acquirer in
good faith, however, the person, even though he was in good faith
when he acquired the property that had been lost by the owner due
to a crime committed by other persons, is not equated to the
owner of that item. Thus, under the Civil Code, the legal status
of the owner and that of the acquirer in good faith are not the
same.
5. It has been mentioned that, under Paragraph 2 of Article
4.96 of the Civil Code, the immovable item may be demanded and
obtained from an acquirer in good faith if the owner had lost
such item due to a crime committed by other persons.
The disputed legal regulation inter alia is to be construed
also in the context of the legal regulation established in
certain articles (paragraphs thereof) of the Criminal Code of the
Republic of Lithuania.
5.1. On 26 September 2000, the Seimas adopted the Republic
of Lithuania Law on the Confirmation and Entry into Force of the
Criminal Code, by Article 1 of which it approved the Criminal
Code, and under Article 2 of which, the date of coming into force
of the Criminal Code had to be established by a separate law. On
29 October 2002, the Seimas adopted the Republic of Lithuania Law
on the Procedure of Entry into Effect and Implementation of the
Criminal Code as Confirmed by Law No. VIII-1968 of 26 September
2000, the Code of Criminal Procedure, as Confirmed by Law No. IX-
785 of 14 March 2002, and the Code of Execution of Punishments as
Confirmed by Law No. IX-994 of 27 June 2002. Article 1 of this
law established that the new Criminal Code shall become effective
as of 1 May 2003; under Paragraph 1 of Article 47, upon coming
into effect of the new Criminal Code, the Criminal Code which had
been valid until then became null and void.
5.2. Under Article 10 (wording of 26 September 2000) of the
Criminal Code, criminal deeds are divided into crimes and
criminal offences. At the time of adoption and coming into effect
of the Civil Code which includes the provision disputed by the
petitioners, the old Criminal Code was in effect, under which,
criminal deeds were not divided into crimes and criminal
offencesthey were called crimes.
In this context it needs to be noted that, as the
Constitutional Court has held more than once, crimes are
violations of law by which human rights and freedoms as well as
other values protected and defended by the Constitution are
especially grossly violated, negative impact is made on the
living conditions, the subsistence level of people, and by which
the fundamentals of life of the state and society are encroached
upon (Constitutional Court rulings of 8 May 2000, 29 December
2004 and 16 January 2006). It also needs to be noted that the
Constitution does not prevent usage of other words or formulas in
laws and other legal acts than those used in the text of the
Constitution (Constitutional Court ruling of 16 January 2006). In
this context it also needs to be noted that when in laws and
other legal acts one uses the words or formulas to describe the
same phenomena which are different from those used in the text of
the Constitution, it is important not to use them incorrectly
creating preconditions to deny the particularity of the
regulation established in the Constitution.
5.3. Thus, upon coming into effect of the new Criminal Code,
the notion "crime" which is used in Paragraph 2 of Article 4.96
of the Civil Code includes both forms of the criminal deed:
crimes and criminal offences.
5.4. Under the new Criminal Code, subjects of the criminal
liability shall be both natural and legal persons. In this
context it needs to be noted that Paragraph 5 (wording of 5 July
2004) of Article 20 of the Criminal Code inter alia provides that
the state, state and municipal institutions and establishments
shall not be liable under this code.
6. It has been mentioned that the doubts of the petitioners
regarding the compliance of Paragraph 2 of Article 4.96 of the
Civil Code with Article 23 of the Constitution are virtually
substantiated by the fact that the acquirer in good faith, who
has acquired an item which was lost by the owner due to a crime
committed by other persons, according to the petitioners, also
becomes an "equal" owner of this item. According to the
petitioners, by demanding and obtaining the immovable item from
the acquirer in good faith according to Paragraph 2 of Article
4.96 of the Civil Code, the needs of society are not satisfied
and the acquirer in good faith is not justly compensated for,
therefore, the disputed legal regulation violates the rights of
ownership of a person.
7. In this ruling it has been held that Article 23 of the
Constitution enshrines the principle of inviolability of
property. This principle would be denied if the rights of
ownership of the owner would not be defended after the owner lost
his property due to a crime committed by another person (other
persons). When the owner loses his property due to a crime
committed by another person (other persons), it does not mean
that he loses the rights of ownership, and it does not mean that
a person, who acquired such property, becomes its owner. Under
the Constitution, the owner has the right to retrieve his
property which has been lost due to a crime committed by another
person (other persons); such his right is an important
constitutional guarantee of protection of the rights of
ownership. It implies the duty of the legislator to establish
such legal regulation which would ensure the defence of the
rights of ownership of a person which lost his property due to a
crime committed by another person (other persons).
It has also been held that when a person acquires property
without knowing or without being able to know that the owner has
lost it due to a crime committed by another person (other
persons), the acquisition of such property may not be treated in
itself as creating the rights of ownership to the acquirer of
property.
It has been mentioned that the imperatives which stem from
Paragraph 3 of Article 23 of the Constitution are not applied for
seizing of property from its owner in such cases when the owner
retrieves the property lost due to a crime committed by another
person (other persons).
Thus, by the legal regulation established in Paragraph 2 of
Article 4.96 of the Civil Code, under which an immovable item may
be obtained from an acquirer in good faith only in the cases when
the owner lost such item due to a crime committed by other
persons, one does not deviate from the imperatives enshrined in
Article 23 of the Constitution.
8. In the context of the constitutional justice case at
issue it needs to be noted that in its ruling of 8 April 1997,
the Constitutional Court held that, in addition to other things,
the fact that Article 143 of the Civil Code prescribes that the
owner has the right to demand and obtain the property from its
acquirer in good faith providing the owner or another person to
whom the owner has transferred it for possession has been lost or
seized from either of them or ceased to be possessed irrespective
of their will is a universally recognised rule of protection of
the right of ownership.
It needs to be noted that the legal regulation established
in Paragraph 1 of Article 143 of the Civil Code which was
effective until 1 July 2001 and the legal regulation established
in Article 4.96 of the Civil Code which includes the provision
disputed by the petitioners are analogous in the aspect that
under certain conditions established in the Civil Code the
property could be demanded and obtained from the acquirer in good
faith.
9. Taking account of the arguments set forth, one is to draw
a conclusion that Paragraph 2 of Article 4.96 of the Civil Code
is not in conflict with Article 23 of the Constitution.
10. It has been mentioned that the doubts of the petitioners
regarding the compliance of the disputed legal regulation with
Paragraph 1 of Article 29 of the Constitution are virtually
substantiated by the fact that the owner of the item and the
acquirer in good faith are equally not liable for the crime due
to which the owner has lost the item; the item may be demanded
and obtained from the acquirer in good faith regardless of his
legitimate expectations, possible improvements of the item, etc.
Therefore, the situation of the two "equal" owners is different,
and by such legal regulation one violates the constitutional
principle of all persons' equality before the law.
11. The Constitutional Court has held in its acts more than
once that the constitutional principles of equality of persons
before the law which is enshrined in Paragraph 1 of Article 29 of
the Constitution establishes formal equality of all persons
before the law, that it obliges to legally assess equal facts in
the same manner and prohibits to arbitrarily assess essentially
the same facts differently, that it does not permit to
discriminate persons or to grant them privileges, however, it
does not deny the possibility to establish, by means of a law,
different (differentiated) legal regulation with regard to
persons of certain categories who are in different situations.
The constitutional principle of equality of persons does not deny
the possibility to treat persons differently by taking account of
their status and situation.
12. Taking account of the fact that the legal status of the
owner and the acquirer in good faith is not the same, and that
they are in different positions, one is to draw a conclusion that
Paragraph 2 of Article 4.96 of the Civil Code is not in conflict
with Paragraph 1 of Article 29 of the Constitution.
13. Having held that Paragraph 2 of Article 4.96 of the
Civil Code is not in conflict with Article 23 and Paragraph 1 of
Article 29 of the Constitution, it needs also to be held that the
legal regulation established in Paragraph 2 of Article 4.96 of
the Civil Code does not violate the legitimate expectations of
the acquirer in good faithone of the essential elements of the
principle of a state under the rule of laweither.
Therefore, while taking account of the arguments set forth,
one is to draw a conclusion that Paragraph 2 of Article 4.96 of
the Civil Code is not in conflict with the constitutional
principle of a state under the rule of law as well.
14. Having held in this constitutional justice case that
Paragraph 2 of Article 4.96 of the Civil Code is not in conflict
with Article 23 and Paragraph 1 of Article 29 of the Constitution
and with the constitutional principle of a state under the rule
of law, one is to note that, under the Constitution, the rights
of also such a person, who sought to acquire property lawfully
and in good faith, but has acquired it without knowing that the
owner had lost that property due to a crime committed by another
person (other persons), must be defended. It has been mentioned
that the requirement to defend the rights of such person stems
from the Constitution, inter alia the constitutional principle of
a state under the rule of law, the constitutional principle of
compensation for damage inflicted upon a person which is
enshrined in Article 30 of the Constitution, and Article 46 of
the Constitution.
Conforming to Articles 102 and 105 of the Constitution of
the Republic of Lithuania and Articles 1, 53, 54, 55 and 56 of
the Law on the Constitutional Court of the Republic of Lithuania,
the Constitutional Court of the Republic of Lithuania has passed
the following
ruling:
To recognise that Paragraph 2 (Official Gazette Valstybės
žinios, 2000, No. 74-2262) of Article 4.96 of the Civil Code of
the Republic of Lithuania is not in conflict with the
Constitution of the Republic of Lithuania.
This ruling of the Constitutional Court is final and not
subject to appeal.
The ruling is promulgated in the name of the Republic of
Lithuania.
Justices of the Constitutional Court: Armanas Abramavičius
Toma Birmontienė
Pranas Kuconis
Kęstutis Lapinskas
Zenonas Namavičius
Ramutė Ruškytė
Egidijus Šileikis
Algirdas Taminskas
Romualdas Kęstutis Urbaitis