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	European Court of Human Rights
You are here: BAILII >> Databases >> European Court of Human Rights >> PINE VALLEY DEVELOPMENTS LTD AND OTHERS v. IRELAND (ARTICLE 50) - 12742/87 [1993] ECHR 2 (9 February 1993) URL: http://www.bailii.org/eu/cases/ECHR/1993/2.html Cite as: [1993] ECHR 2, (1993) 16 EHRR 379, 16 EHRR 379

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In the case of Pine Valley Developments Ltd and Others v.

Ireland*,

The European Court of Human Rights, sitting, in accordance

with Article 43 (art. 43) of the Convention for the Protection

of Human Rights and Fundamental Freedoms ("the Convention")** and

the relevant provisions of the Rules of Court, as a Chamber

composed of the following judges:

Mrs D. Bindschedler-Robert, President,

Mr L.-E. Pettiti,

Mr C. Russo,

Mr J. De Meyer,

Mr S.K. Martens,

Mrs E. Palm,

Mr I. Foighel,

Mr R. Pekkanen,

Mr J. Blayney, ad hoc judge,

and also of Mr M.-A. Eissen, Registrar,

Having deliberated in private on 23 September 1992 and

1 February 1993,

Delivers the following judgment, which was adopted on the

last-mentioned date:

_______________

Notes by the Registrar

* The case is numbered 43/1990/234/300. The first number is the

case's position on the list of cases referred to the Court in the

relevant year (second number). The last two numbers indicate the

case's position on the list of cases referred to the Court since

its creation and on the list of the corresponding originating

applications to the Commission.

** As amended by Article 11 of Protocol No. 8 (P8-11), which came

into force on 1 January 1990.

_______________

PROCEDURE AND FACTS

1. The case was referred to the Court by the European

Commission of Human Rights ("the Commission") and by the

Government of Ireland ("the Government") on 11 July and

11 September 1990, respectively. It originated in an application

(no. 12742/87) against Ireland lodged with the Commission in 1987

by two companies registered in that State, Pine Valley

Developments Ltd ("Pine Valley") and Healy Holdings Ltd ("Healy

Holdings"), and an Irish national, Mr Daniel Healy.

2. By judgment of 29 November 1991 ("the principal judgment"),

the Court held, inter alia, that Healy Holdings and Mr Healy

(hereinafter together referred to as "the applicants") had been

victims of discrimination contrary to Article 14 of the

Convention, taken in conjunction with Article 1 of

Protocol No. 1 (art. 14+P1-1), in that section 6 of the Local

Government (Planning and Development) Act 1982 ("the 1982 Act")

had retrospectively validated all planning permissions in the

relevant category other than theirs (Series A no. 222,

paragraphs 61-64 of the reasons and point 6 of the operative

provisions, pp. 26-27 and 29).

The only outstanding matter to be settled is the question

of the application of Article 50 (art. 50). As regards the

facts, reference should be made to paragraphs 8-34 of the

principal judgment (ibid., pp. 8-17).

3. At the Court's hearing on 21 May 1991, counsel for the

Government and the Delegate of the Commission both reserved their

position on the claims for just satisfaction advanced by the

applicants.

In the principal judgment, the Court therefore reserved the

whole of this question and invited the Government and the

applicants to submit, within the next three months, their written

comments thereon and, in particular, to notify the Court of any

agreement reached between them (paragraphs 67-68 of the reasons

and point 8 of the operative provisions, pp. 28-29).

4. Following the failure of settlement negotiations and in

accordance with the foregoing invitation and the President's

directions, submissions and observations relating to the claims

under Article 50 (art. 50) were filed by the applicants on

28 February, 19 March, 20 and 22 April and 30 June 1992, by the

Government on 27 March, 10 April and 15 June 1992 and by the

Delegate of the Commission on 10 April 1992. The materials

furnished to the Court included valuations by chartered surveyors

of the land owned by Healy Holdings, to which outline planning

permission had initially been attached ("the Clondalkin site").

5. On 23 September 1992 the Court decided that there was no

need to hold a hearing.

6. At the deliberations on 1 February 1993 Mr R. Ryssdal and

Mr J. Pinheiro Farinha, who had sat to consider the merits of the

case but were unable to be present on that date, were replaced

by Mrs D. Bindschedler-Robert, who sat as President of the

Chamber, and Mr S.K. Martens, substitute judge, respectively;

Mrs Bindschedler-Robert in her turn was replaced by Mr R.

Pekkanen, also a substitute judge (Rules 21 para. 5, 22 para. 1,

24 para. 1 and 54 para. 2).

AS TO THE LAW

7. Under Article 50 (art. 50) of the Convention,

"If the Court finds that a decision or a measure taken by

a legal authority or any other authority of a High

Contracting Party is completely or partially in conflict

with the obligations arising from the ... Convention, and

if the internal law of the said Party allows only partial

reparation to be made for the consequences of this decision

or measure, the decision of the Court shall, if necessary,

afford just satisfaction to the injured party."

The applicants claimed under this provision compensation for

pecuniary damage and reimbursement of costs and expenses,

together with interest. Mr Healy also sought compensation for

non-pecuniary damage.

A. Pecuniary damage

8. The applicants claimed compensation for the pecuniary damage

they had sustained by reason of the fact that the 1982 Act had

not retrospectively validated the outline planning permission

which had been granted in 1977 in respect of the Clondalkin site

and had been declared by the Supreme Court in 1982 to be a

nullity.

9. It was common ground between the applicants, the Government

and the Delegate of the Commission that this was a proper case

for an award of compensation for pecuniary damage. The

applicants stated that they were not seeking to recoup the

profits which they would have earned had they been able to

develop the site; their claim was formulated on the basis that

the loss to be made good to them was the difference between the

values, on the relevant date, of the site with and without the

outline planning permission. It was also common ground between

the applicants and the Government that the relevant date in this

connection was 28 July 1982, being the date on which the 1982 Act

had entered into force. Whilst the Delegate of the Commission

expressed reservations about the use of that date, the Court

considers that it is not an inappropriate one for the present

purposes.

10. The principal point of contention on this part of the case

was the value which the Clondalkin site would have had in July

1982 if the outline planning permission granted in 1977 had still

been in force. Relying on valuation reports by chartered

surveyors, the applicants and the Government advanced in this

connection figures of IR£2,200,000 and IR£550,000, respectively.

11. Faced with a difference of this magnitude, the Court has

sought in the first place to extract from the material before it

elements in respect of which there is no, or a lesser degree of,

dispute. In doing so, it has noted the following.

(a) Pine Valley purchased the 22-acre - or, according to

the Government, 21.5-acre - Clondalkin site in November 1978, in

an arms-length transaction, for IR£550,000, that is to say at a

price of approximately IR£25,000 per acre.

(b) A site of 4.5 acres, considered by the Government to

be comparable to that of the applicants, was sold at public

auction in June 1981 for IR£200,000, that is IR£44,444 per acre.

Whilst a calculation cannot be made on a simple per acre basis,

this example demonstrates that the period from 1978 to 1981

witnessed an increase in the value of properties for development.

Since it was not disputed that the applicants' land was a prime

development site, there is no reason to suppose that by July 1982

its market value, with outline planning permission, would not

have increased beyond the IR£550,000 obtaining in 1978. Indeed,

the Government themselves estimated that if it had been capable

of immediate development and if no abnormal costs had been

involved (as to which points, see the next two sub-paragraphs),

it would have been worth IR£1,600,000 in July 1982, that is

approximately IR£73,000 per acre.

(c) The Government laid great stress on what they described

as the "inherent defects" of the Clondalkin site, namely that it

had an awkward shape, that access to it was by a narrow road over

which the applicants had only a right of way and that it was not

equipped with public water and sewage services. The applicants

did not maintain that these points were factually incorrect, nor

did they contest the quantum of the deductions which the

Government suggested had to be made in order to arrive at an

open-market value which took these drawbacks into account

(IR£535,000); they pointed out rather, as regards the second and

third of the defects, that the outline planning permission

attaching to the land was not subject to any conditions as to the

improvement of the access or the installation of public services.

The Court, however, considers that these are matters which are

relevant to an assessment of the open-market value of the site:

a prospective purchaser would doubtless have taken into account

any abnormal costs which he would have to incur in order to

provide the development with appropriate facilities, such as

access and services, even if the outline permission imposed no

conditions to that effect.

(d) Although this was questioned by the applicants, the

Government also relied on the fact that there would have been

considerable delay in obtaining the requisite full planning

approval and bye-law approval for the development of the site.

The Court does not consider that those approvals could have been

secured as rapidly as the applicants appear to suggest, since a

purchaser would have had to decide on the precise type of

development he wanted, have detailed plans prepared giving effect

to such decision and finally have those plans approved by the

planning authority. Furthermore, neither the Government nor the

applicants referred in this context to the fact that the

applicants' outline planning permission, had it been

retrospectively validated by the 1982 Act, would have expired on

10 March 1984 and could not have been extended unless substantial

works had already been carried out before that date (see the

principal judgment, p. 10, para. 16). The resultant need for

speedy action on the part of a developer was likely, in the

Court's opinion, to have limited the circle of potential

purchasers and, in consequence, the market value of the land.

(e) The applicants initially asserted that the July 1982

value of their site without the outline planning permission was

IR£50,000, being the sum for which it was sold on the open market

in 1988. However, they subsequently accepted the Government's

proposition that its value in July 1982 for agricultural or

amenity purposes was IR£65,000.

(f) The applicants themselves admitted that, in assessing

compensation on the basis suggested by them, a deduction of

IR£13,500 should be made to cover the potential rental income

from the property in the period from 1982 to 1988.

12. The Court finds itself unable to accept the arguments

advanced by the Government on the following points.

(a) It does not consider that, in quantifying the damage

sustained by the applicants, allowance should be made for the

capital gains tax to which they would have been liable on a sale

of the site or for the stamp duty which such a transaction would

have attracted. This is because what has to be assessed, having

regard to the manner in which the applicants' claim was

formulated, is the value of the land in their hands, rather than

the net proceeds which they would have received had they disposed

of it.

(b) The Court is not satisfied that the Government have

established grounds for the making of the deduction referred to

in their final submission as "Defer for 4 years at 15% per annum:

IR£590,000".

(c) The Court agrees with the Delegate of the Commission

that no reduction should be made to reflect the fact that, in the

principal judgment, it held that there had been no breach of

Article 1 of Protocol No. 1 (P1-1) to the Convention: that is a

matter that had no influence on the quantum of the damage flowing

from the discrimination of which the Court found that the

applicants had been victims.

13. The applicants submitted that the Court's award should

include interest from the date of the violation of the

Convention, namely 28 July 1982, on the ground that if

compensation had been paid to them on that date, it would have

earned interest since then.

14. The Court agrees with the Delegate of the Commission that

interest should be paid. Since the applicants' claim is not

based on loss of development profits, it is not persuaded by the

Government's argument that to award interest would amount to

providing compensation for property speculators. Nor does it

share the Government's view that the applicants are estopped from

claiming interest by reason of their failure to do so in the

domestic proceedings, since it would have been open to the court

of its own motion to award interest in those proceedings.

In connection with the claim for interest, the Court

considers that it should have regard to the rates applicable to

Irish court judgments; the commercial rates cited by the

applicants appear to be more appropriate to a claim based on lost

development profits.

15. Having regard to the foregoing and making an assessment on

an equitable basis, the Court concludes that the applicants

should be awarded a global sum, including interest, of

IR£1,200,000 under this head.

B. Non-pecuniary damage

16. Mr Healy claimed a "very substantial", but unquantified, sum

for non-pecuniary damage, to compensate him for the effects which

the violation found by the Court had had on his personal

circumstances, namely loss of status, prospects and enjoyment of

life, inability to obtain employment, and bankruptcy. He left

the assessment of the award to the Court's discretion.

The Delegate of the Commission considered that Mr Healy

should receive some compensation under this head. The Government

took the contrary view, on the ground that he had not established

a clear causal connection between the violation and the

deterioration in his circumstances. In the alternative, they

maintained that an award of compensation for pecuniary damage,

coupled with the declaratory relief afforded by the principal

judgment, would suffice to meet the justice of the case.

17. The Court is unable to accept the Government's submissions.

Even assuming that, as they suggested, Mr Healy's personal

difficulties originated in problems encountered with other

development projects with which he was involved, there is no

reason to suppose that the inability to proceed with the

Clondalkin development did not compound and aggravate those

difficulties. The violation of the Convention therefore caused

him non-pecuniary damage and, in the Court's view, the finding

in the principal judgment does not of itself constitute

sufficient just satisfaction therefor.

Making an assessment on an equitable basis, the Court awards

Mr Healy IR£50,000 under this head.

C. Costs and expenses

18. The applicants sought reimbursement of legal costs and

expenses totalling IR£449,415.11, this amount being made up as

follows:

(a) costs incurred in Ireland after 28 July 1982, in

proceedings in the High Court and the Supreme Court, together

with interest: IR£42,655.11;

(b) costs referable to the proceedings in Strasbourg,

including those relating to the application of Article 50

(art. 50): IR£406,760.

The Government disputed this claim, which they saw as

"greatly inflated": in their view, a reasonable sum (inclusive

of value-added tax) for both the domestic and the Strasbourg

proceedings would be IR£80,455.97.

The Delegate of the Commission too found that the amount

claimed was high, but he left it to the Court to assess a

reasonable figure.

19. The Court has examined the matter in the light of the

principles that emerge from its case-law.

It notes, in the first place, that it is not contested that

the costs claimed were actually and necessarily incurred. The

amount sought in respect of the domestic proceedings should, it

finds, be reimbursed in full: the quantum of fees and expenses

cannot be regarded as unreasonable and the addition of interest

is warranted (see, on the latter point, the Observer and Guardian

v. the United Kingdom judgment of 26 November 1991, Series A

no. 216, p. 38, para. 81).

On the other hand, the Court agrees that the claim in

respect of the Strasbourg proceedings is excessive. Taking into

account the amount paid to Mr Healy by the Council of Europe by

way of legal aid in respect of fees and making an assessment on

an equitable basis, the Court awards for this item IR£70,000,

together with any value-added tax that may be due.

D. Interest on the Court's award

20. The applicants also sought interest on the sums awarded (at

least, those for pecuniary damage and for costs) for the period

between the date of the present judgment and the date of payment.

21. Neither the Government nor the Commission adverted to this

claim. The Court does not consider it appropriate to accede to

it in this instance.

FOR THESE REASONS, THE COURT UNANIMOUSLY

1. Holds that Ireland is to pay, within three months:

(a) to Healy Holdings Ltd and Mr Healy jointly the sum of

IR£1,200,000 (one million two hundred thousand Irish

pounds) for pecuniary damage, the sum of IR£42,655.11

(forty-two thousand six hundred and fifty-five Irish pounds

and eleven pence) for domestic costs and expenses and the

sum of IR£70,000 (seventy thousand Irish pounds), together

with any value-added tax that may be due, for Strasbourg

costs and expenses;

(b) to Mr Healy the sum of IR£50,000 (fifty thousand Irish

pounds) for non-pecuniary damage;

2. Dismisses the remainder of the claim for just satisfaction.

Done in English and in French, and notified in writing under

Rule 55 para. 2, second sub-paragraph, of the Rules of Court on

9 February 1993.

Signed: Denise BINDSCHEDLER-ROBERT

President

Signed: Marc-André EISSEN

Registrar