Violation of Article 1 of Protocol No. 1 - Protection of property (Article 1 para. 2 of Protocol No. 1 - Control of the use of property);Respondent State to take measures of a general character (Article 46 - General measures;Article 46-2 - Measures of a general character);Pecuniary damage - award;Pecuniary damage - claim dismissed

Lech Garlicki;Ledi Bianku;Nicolas Bratza;Päivi Hirvelä;Sverre Erik Jebens;Vincent A. De Gaetano;Zdravka Kalaydjieva

The applicants are :

CARDINAL ) PERSON , born in DATE , who lives in GPE ;

CARDINAL ) Mr PERSON , born in DATE , who lives in ORG ;

DATE ) The spouses PERSON and Mr PERSON , born in DATE and DATE , who live in ORG ;

CARDINAL ) PERSON , born in DATE , who lives in PERSON ; and

CARDINAL ) Mr PERSON , born in DATE , who lives in ORG .

The applicants are landowners and lessors who concluded ground lease contracts regarding their plots of lands for permanent homes or holiday homes prior to DATE . On DATE , upon the entry into force of LAW DATE ( GPE ) , for the first time under NORP law , the rental or leasing of plots of land for permanent homes and holiday homes became the subject of special statutory regulation .

Prior to CARDINAL DATE such agreements were governed by the general rules ( statutory and other ) on contracts . Ordinarily such contracts were concluded for DATE and often contained clauses giving the lessee a right to extension of the contract upon expiry . According to legal doctrine , where such clauses had not expressly been set out in the contract , there was a custom or implicit assumption that the lessee had a right to extension of the contract unless the lessor had an objective ground for refusing renewal . Some lease contracts contained clauses which gave the lessor a right to increase the rent at intervals , in order to compensate for inflation . However , pursuant to CARDINAL ORG judgments of DATE , such a right was granted even in the absence of any explicit contract clause to that effect .

In DATE a new LAW was enacted with effect from DATE .

NORP Under both LAW and LAW the lessee was entitled to have the ground lease contract extended but the lessor had the right to introduce new conditions into the contract .

With effect from DATE LAW was amended anew ; inter alia , from that date its section CARDINAL granted all lessees of plots for permanent homes and holiday homes the right to claim extension of their lease on the same conditions as previously and without limitation in time , when the agreed term of lease between the parties expired . The reason was a strongly felt concern across ORG ( ORG ) , with CARDINAL exception – ORG ( PERSON ) , that lessees who were not able to afford the price of redemption would need the legislator ’s protection in order to be able to extend the lease . The introduction of the disputed provision of section CARDINAL of LAW was essentially motivated by social policy considerations ( see paragraphs CARDINAL - CARDINAL below ) .

NORP In order better to understand the rationale behind this amendment , it is important to bear in mind the underlying socio - economic factors in GPE . In the post - war area , limited resources for the purchase of real estate was CARDINAL factor that made ground lease arrangements attractive for people who wanted to own a permanent home or a holiday home . For property owners , it was an expedient way of obtaining a steady income from their land without making any investments and an attractive alternative to selling the land , in a country with a small population on a vast territory and with moderate price levels . This might explain why such arrangements became so popular . There exist CARDINAL ground lease contracts ( PERCENT for permanent homes and PERCENT for holiday homes ) in a population of CARDINAL people , the majority of contracts being for private homes ( Proposal No . CARDINAL to the PERSON ( DATE ) , p. CARDINAL ) .

DATE until DATE the price level of the real - estate market developed more or less at a similar pace to general price inflation . However , this began to change around DATE , when real - estate prices started soaring . This was especially the case from DATE for property around the larger cities and in popular areas for recreation , but prices have continued to rise , in all parts of the country . A number of lessors then used the opportunity under the law to demand redemption , which resulted in many lessees being put in a difficult financial position ( paragraph CARDINAL of ORG judgment of DATE in the leading case referred to at paragraph CARDINAL below ) . Because of the dramatic increase in pressure on real - estate prices the legislator thought it necessary to intervene to protect the GPE interests . This was done in DATE by regulating the level of possible rent increases so that they could only reflect general inflation , not the rising cost of land .

In consequence thereof a lessor , who is not one of the applicants , lodged civil proceedings before ORG ( tingrett ) against CARDINAL lessees who had leased plots of land for permanent homes , claiming that the amended section CARDINAL of LAW contravened Articles CARDINAL or CARDINAL of the LAW , concerning respectively the prohibition of retroactive laws and the right to full compensation in case of expropriation , or LAW No . CARDINAL to the Convention .

On DATE , ORG passed judgment in favour of the lessor , finding that section CARDINAL of LAW contravened both LAW and LAW .

On appeal , the case was brought directly before ORG ( PERSON ) , which by judgment of CARDINAL DATE ( HR CARDINAL-P , case no . CARDINAL/CARDINAL ) found against the lessor . It considered that section QUANTITY of LAW should be examined exclusively in the light of LAW of the LAW , with which it was compatible , and that there was no infringement of LAW No . CARDINAL to the Convention . In his reasoning , approved in the main by the other six Justices sitting in the case , the first voting judge , PERSON Justice Matningsdal , stated in so far as relevant :

“ ( CARDINAL ) The lessee ’s submission that the right to extension of the lease ‘ on the same terms as ORG represents a restriction can in my opinion not succeed . Ever since the judgment in the LAW case in ORG law reports ( PERSON R.t . ” ) DATE I p. CARDINAL , ORG has taken as its point of departure that if , as stated by Assessor Siewers in GPE . DATE p. CARDINAL , there is ‘ a ceding on the part of the owner and an acquisition on the part of the ORG which wholly or in part transfers the owner ’s disposal of the property to the ORG or others for further enjoyment for the same or other purposes’ , it will follow from Article CARDINAL that full compensation must be paid . Conversely , there will be a restriction on the use of property if ‘ there is no ceding and acquisition but rather provisions that for the promotion of public interest considerations and in the interest of society aim to regulate the owner ’s disposal of the property , without any transfer to third parties’ .

( CARDINAL ) The right to extension provided for in section CARDINAL must clearly be distinguished from a regulation of the owner ’s disposal of the property . Section CARDINAL grants the lessee a right to lease the plot for a longer period than provided for in the agreement . In other words , there is a transfer of rights in the property beyond the agreed period of time - which viewed in isolation could indicate that the situation is directly regulated by Article CARDINAL . In this context , I should note that the requirement as to ‘ full compensation’ in Article CARDINAL also applies in the case of expropriation of limited rights ...

( CARDINAL ) Although section CARDINAL of LAW entails a transfer of the owner ’s disposal of the property , I nevertheless have no doubt that the constitutionality of the right to an extension on unchanged conditions must be assessed in relation to LAW , rather than LAW . This was also the view of the legislators , see Proposal No . CARDINAL to the PERSON ( DATE ) , p. CARDINAL , quoted above , which assumes that the question of constitutionality must be decided by reference to LAW . A central point in this context is that the rules on extension intervene with a regulatory effect in a situation created by the parties themselves through the contract of ground lease . The agreement makes it necessary for the lessees to be permitted to maintain their buildings on the plot for a very long period of time after the agreed term of lease has expired . The statutory provision represents a regulation – with retroactive effect – related directly to the agreement , or , more precisely , to the restrictions contained in the agreement . In our legal tradition a subsequent regulation of this nature relating to a contractual relationship between the parties is assessed in relation to LAW , not in relation to LAW . This is the case even where a regulation has resulted in a transfer of rights and obligations between the parties . This view must also be applicable in a case such as ours , even though the intervention in the agreement entails a transfer of disposal.’

( CARDINAL ) The concrete assessment in relation to LAW

( CARDINAL ) ... An assessment must be made in full of the consequences of the act . In this assessment , on the CARDINAL side weight must be accorded to the considerations of the lessees . The latter must be balanced against the act ’s consequences for the lessors , and how protection - worthy their interests are .

( CARDINAL ) When it comes to a ground lease it is fundamental that one is confronted with a conflict of interests between CARDINAL parties . The landowner owns the land , while the lessee owns the building or buildings which have been erected on the land . When balancing , it is of central importance that almost without exception the lessee ’s economic interest is greater . Even if the example is not representative for buildings constructed for individual habitation or for holiday purposes , I note nevertheless that in the sales project regarding the CARDINAL apartments in the present case , the prices were set at between ORG CARDINAL and ORG CARDINAL depending on size and position . The price for CARDINAL of the most expensive apartments was thus higher than the price paid DATE previously for the whole plot of land . But also as regards buildings constructed for individual habitation and for holiday purposes , normally the lessee has paid the more significant financial contribution .

( CARDINAL ) In respect of a lease for permanent homes , the lessee ’s essential right to housing for himself and his family must be protected DATE which was the principal reason behind the amendment of the act . In addition , for the majority of lessees it concerns their single largest investment . They have a well - founded expectation that the legislators will protect their factual situation . Moreover , this is illustrated by the fact that besides the area of ground leasing , we have several examples where the legislators have found it justified to protect rights of this kind , even when such interference may mean a certain form of transfer of rights :

( CARDINAL ) Firstly LAW of DATE no . CARDINAL ...

( ORG ) Secondly I note LAW of DATE concerning rent ...

( CARDINAL ) The regulation of rent is a third example , which illustrates the legislation ’s endeavour to protect the right to housing ...

( CARDINAL ) The right to continue the lease contract on ‘ the same terms as before’ has first and foremost significance for the lessor ’s possibility to increase the rent . The examination above [ CARDINAL - CARDINAL ] shows that for a long time considerable legislative efforts have been made to protect the right to housing . This area of law has been strongly legislated , and the market mechanisms have to a large extent not been the deciding factor . Already , therefore , lessors must have been prepared for the law makers to follow developments closely and if necessary intervene in the ongoing lease relations in order to safeguard the lessee ’s need to protect his home and his investments .

( CARDINAL ) Furthermore , as regards long - term agreements , like ground lease contracts , the parties must be prepared for developments to take a direction which increases the legislator ’s need to intervene with legislation to secure a proper balance between the parties . This has not only benefited the lessees : the enactment of section CARDINAL of LAW in DATE gave lessors the possibility to adjust the lease upwards in contracts which did not contain a regulation clause , and where the rent had become unreasonably low because of a significant decrease in the value of money ...

( CARDINAL ) [ The lessors ] have emphasised that as the contracts were entered into during a period of index linkage , they anticipated that price regulation would be lifted [ at the expiry of the contract ] and that , when extending the contract , they would be able to charge a rent which reflected the real value of the land . I note in this connection that it is questionable how strong this anticipation could have been . ... I refer to [ a ORG judgment , ORG . DATE p.CARDINAL , in which the court stated among other things about the parties’ expectations ] ... ‘ [ the lessors ] have attached great weight to the fact that a clause was inserted in the contract stipulating that disputes as to the regulation of ground rent were to be decided in the light of an expert opinion . They maintain that the insertion of such a clause would have been unnecessary had they anticipated that price regulation would follow index linkage . In my view , however , much weight can not be attached thereto . In DATE it was difficult to predict that the prices of plots of land for holiday houses would increase considerably more than general inflation would indicate . It is most likely that when entering into the contract , the parties did not have any clear conception of what the material basis for regulating the ground rent should CARDINAL

( CARDINAL ) In addition to the quotation above , I note that in so far as the lessors had anticipated that price regulation would be lifted , they could not have had any legitimate anticipation that the legislator would accept an increase in ground rent which deviated significantly from the general price trend . Had the legislator not intervened , the price increase in DATE would almost have amounted to an ‘ accidental profit’ – see PERSON ( DATE ) p. CARDINAL , second column . Accordingly , it was not realistic to anticipate that the legislators would not intervene in the price increases we have had in DATE .

( CARDINAL ) Moreover , I observe that the present case concerns long - term contracts under which the landowner has received contractual ground rent for DATE . This also has its importance under LAW .

( CARDINAL ) The lessors have maintained that it is unreasonable that at the expiry of the contracts they will be in a [ worse ] position than lessors who enter new leasing contracts . In these situations , it follows that under LAW of LAW the freedom of agreement is significant in that the agreed ground rent is valid as long as it is not ‘ unreasonably high in relation to what is customarily paid in the locality on new leases on similar plots on similar contractual terms’ . In my view , however , there is a crucial difference between the CARDINAL situations : I refer to the elements already emphasised . In this connection , I especially note that concerning ground leases , such as those in question , where the life span of the building clearly exceeds the duration of the ground lease contract , the lessor has all along been aware that the extension of the contract would become an issue . When negotiating the terms of the extension of the contract , a lot would be at stake financially for the lessee . Despite the authority to expropriate in LAW , there was a risk , as also indicated in Ot.prpr . no . CARDINAL ( DATE ) , p. CARDINAL , second column , that the lessor would impose some quite oppressive conditions on the lessee . In such cases the lessors could not expect the legislator to refrain from price regulation when renewing ground lease contracts . I recall that when the ground lease contracts at issue were entered into , the establishment of ground lease contracts was price - regulated , and an increase in the ground rent required approval from ORG [ prisnemnda ] .

( CARDINAL ) Taking the [ above circumstances into consideration , ] there is a strong case for concluding that the provision which gives lessees the right to continue the ground lease on the same terms as before is not affected by the prohibition of retroactive laws set out in LAW . It is true that the provision means that the entire increase in the value of the land – to the extent that it exceeds increases in the consumer price index – can be said to accrue to the lessees after the extension of the lease . In other words , there is no apportioning of the increase in value that led to the legislative amendment . Nevertheless , I find that , given the situation which existed , it must lie within the freedom granted to the legislator under LAW to regulate matters in this way .

( CARDINAL ) When assessing [ compliance with the constitution ] the question arises whether the retroactive provision safeguards objective considerations of equality . [ ... ]

( CARDINAL ) It is section CARDINAL on the adjustment of the ground lease rent which in particular raises the question of whether considerations of equality have been sufficiently preserved . As a result of this provision the former provision on adjustment of the ground lease rent was repealed . LAW ( CARDINAL ) provides :

( CARDINAL ) With regard to the CARDINAL - off adjustment upon the entry into force of the LAW , section CARDINAL ( CARDINAL ) provides :

( CARDINAL ) LAW of LAW thus provided for a possibility to factor into the calculation of the ground lease rent an increase in the value of the plot beyond the general inflation rate . But the possibility is limited to instances where such adjustments have ‘ ORG been agreed to , and the requirement that the agreement be clear is particularly strict – see PERSON ‘ R.t.’ DATE , at p. DATE . In view of this requirement as to clarity , and of the information available about adjustment clauses in ground lease contracts in general , a minority of contracts is covered by this provision . There are in addition important limitations also on the situations which are covered by the right under section CARDINAL ( CARDINAL)(CARDINAL ) to include in the calculation an increase in values as mentioned . There is only provision for a CARDINAL - off adjustment and there are limitations as to the amount .

( CARDINAL ) In my view , even though LAW hardly requires the exception provided for in section CARDINAL(CARDINAL)(CARDINAL ) , there is arguably an objective ground for giving these ground lease agreements a special status with regard to the possibility to adjust the ground lease rent . The basis for so doing is precisely that adjustment in accordance with the ground value here has been directly expressed and has therefore created a safer and closer expectation about adjustment on that ground . In the light of that I can not see that the provision in section CARDINAL(CARDINAL)(CARDINAL ) infringes the condition of equality and thus provides a ground for setting the section CARDINAL right aside as being incompatible with LAW .

( CARDINAL ) I add that the fact that the redemption rules can offer a better financial result for the lessor than those on extension of the lease on unaltered conditions is not a ground for holding that section CARDINAL is incompatible with LAW Redemption is left to the lessee ’s choice . The legislator should be free to decide that if the lessee wishes to avail himself or herself of this right , he or she will have to pay compensation beyond the constitutional minimum .

( CARDINAL ) Hereafter my conclusion is that LAW of LAW does not contravene LAW . The provision is justified by weighty housing / social considerations . There was a clear need to protect a number of lessees and the lessors had no justified expectation to profit from the quite extraordinary increase of the value of plots of land for leasing .

( CARDINAL ) Finally , it is necessary to assess whether section CARDINAL leads to results that contravene LAW No . CARDINAL to the Convention ...

( CARDINAL ) The question is whether the fact that in the event of an extension the lessor does not have the right to regulate the ground lease upwards to an amount that reflects the actual land value means that the arrangement contravenes this LAW provision .

( CARDINAL ) The central decision in this context is the judgment by ORG in Plenary Session of DATE in PERSON and Others v. the GPE , DATE , Series A no . CARDINAL . The case was occasioned by the enactment by ORG of a statute ‘ LAW CARDINAL’ which granted residents the right to redeem contracts for ‘ building ORG and ‘ premium ORG . The former types of agreement had major similarities with NORP ground leases , the difference being that under these contracts , the house too belonged to the landowner . However , the residents had defrayed the cost of erection and paid a charge for the plot to the landowner . The new act provided that in the event of redemption , the residents should pay only for the value of the land . The plot would not be valued as a plot where a right of title to the house and land were grouped , but rather on the basis of what the landowner could be expected to sell it for with the encumbrance of a leasehold of DATE duration , should anyone else purchase the plot . This amount was far lower than the market value of a released plot , and the plaintiffs claimed that they suffered a loss in the region of ORG CARDINAL.CARDINAL.CARDINAL on individual conveyances . ORG did not find for the applicants .

( CARDINAL ) The applicants contended firstly that the ‘ public interest’ test was satisfied only if the property had been taken ‘ for a public purpose of benefit to the community generally’ ( see PERSON and Others , cited above , paragraph DATE ) . This argument did not succeed ( ibidem , paragraph CARDINAL ) :

‘ For these reasons , the ORG comes to the same conclusion as the ORG : a taking of property effected in pursuance of legitimate social , economic or other policies may be ‘ in the public interest’ , even if the community at large has no direct use or enjoyment of the property taken . The leasehold reform legislation is not therefore ipso facto an infringement of LAW ( PCARDINAL - CARDINAL ) on this ground . Accordingly , it is necessary to inquire whether in other respects the legislation satisfied the ‘ public interest’ test and the remaining requirements laid down in the second sentence of LAW ( PCARDINAL - CARDINAL).’

( CARDINAL ) In paragraph CARDINAL the ORG further underlines that the national courts ‘ are in principle better placed than the international judge to appreciate what is ‘ in the public interest’ . The national authorities accordingly enjoy ‘ a certain margin of appreciation’ .

( CARDINAL ) The ORG then discussed whether the aims sought to be pursued by ORG were legitimate . In this regard , the ORG held , inter alia ( ibidem , paragraph CARDINAL ) :

‘ Eliminating what are judged to be social injustices is an example of the functions of a democratic legislature . More especially , modern societies consider housing of the population to be a prime social need , the regulation of which can not entirely be left to the play of market forces . The margin of appreciation is wide enough to cover legislation aimed at securing greater social justice in the sphere of people ’s homes , even where such legislation interferes with existing contractual relations between private parties and confers no direct benefit on the ORG or the community at large . In principle , therefore , the aim pursued by the leasehold reform legislation is a legitimate one.’

( CARDINAL ) Thereafter , the ORG emphasised that it would not be sufficient that the legislation pursue a ‘ legitimate aim’ but ‘ there must also be a reasonable relationship of proportionality between the means employed and the aim sought to be realised’ ( ibidem , paragraph CARDINAL ) . On the proportionality assessment in the concrete case , the ORG stated ( paragraph CARDINAL ) :

‘ According to the applicants , the security of tenure that tenants already had under the law in force ... provided an adequate response and the draconian nature of the means devised to give effect to the alleged moral entitlement , namely deprivation of property , went too far . This was said to be confirmed by the absence of any true equivalent to LAW in the municipal legislation of the other GPE and , indeed , generally in democratic societies . It is , so the applicants argued , only if there was no other less drastic remedy for the perceived injustice that the extreme remedy of expropriation could satisfy the requirements of LAW PCARDINAL - CARDINAL ) .

This amounts to reading a test of strict necessity into the LAW , an interpretation which the ORG does not find warranted . The availability of alternative solutions does not in itself render the leasehold reform legislation unjustified ; it constitutes CARDINAL factor , along with others , relevant for determining whether the means chosen could be regarded as reasonable and suited to achieving the legitimate aim being pursued , having regard to the need to strike a ‘ fair GPE . Provided the legislature remained within these bounds , it is not for ORG to say whether the legislation represented the best solution for dealing with the problem or whether the legislative discretion should have been exercised in another way ... .

The occupying leaseholder was considered by ORG to have a ‘ moral entitlement’ to ownership of the house , of which inadequate account was taken under the existing law ... . The concern of the legislature was not simply to regulate more fairly the relationship of landlord and tenant but to right a perceived injustice that went to the very issue of ownership . Allowing a mechanism for the compulsory transfer of the freehold interest in the house and the land to the tenant , with financial compensation to the landlord , can not in itself be qualified in the circumstances as an inappropriate or disproportionate method for readjusting the law so as to meet that ORG

( CARDINAL ) As to whether it is permissible to adopt legislation which does not guarantee full compensation , the ORG held in paragraph CARDINAL :

‘ The ORG further accepts the ORG ’s conclusion as to the standard of compensation : the taking of property without payment of an amount reasonably related to its value would normally constitute a disproportionate interference which could not be considered justifiable under LAW ( PCARDINAL - CARDINAL ) . LAW PCARDINAL - CARDINAL ) does not , however , guarantee a right to full compensation in all circumstances . Legitimate objectives of ‘ public interest’ , such as pursued in measures of economic reform or measures designed to achieve greater social justice , may call for less than reimbursement of the full market value . Furthermore , the ORG ’s power of review is limited to ascertaining whether the choice of compensation terms falls outside the ORG ’s wide margin of appreciation in this domain ... .’

section CARDINAL of LAW does not contravene GPE ’s obligations under international law . ”

The first applicant , PERSON , owned agricultural property and had leased CARDINAL plots of land for holiday home purposes , all of which had been built upon . CARDINAL of the leasing contracts was signed in DATE with the original ground rent amounting to ORG CARDINAL . The lease provided for adjustment of the ground rent in accordance with the Consumer Price Index DATE . The lease had a term of DATE and accordingly expired in DATE . At the time of lodging the application the ground lease rent amounted to CARDINAL NORP Krone ( ORG ) ( MONEY ( ORG ) ) per year . Since the applicant and the lessees could not reach an agreement as to an extension of the lease pursuant to section CARDINAL of LAW , the first applicant brought the case before ORG claiming that in the event of an extension of the lease , she should have the right to require the ground rent to be adjusted to the lawful market price . By a judgment of DATE , ORG found in favour of the lessees .

The first applicant appealed against the judgment , and the case was brought directly before ORG , which heard it together with the leading case mentioned above . By a judgment of DATE ORG found against the first applicant . In his reasoning , approved in the main by the CARDINAL Justices sitting in the case , the first voting judge , PERSON Justice Utgård , stated in so far as relevant :

“ ( CARDINAL ) I have arrived at the conclusion that the appeal can not succeed on the grounds given in the [ leading judgment ] DATE .

( CARDINAL ) It is true that this case concerns a holiday home property , whereas the case decided earlier DATE concerned leases for permanent home purposes . On some points , LAW the past have made distinctions between these purposes . The current section CARDINAL does not distinguish between plots for permanent homes and plots for holiday homes . It must accordingly be assumed that the legislators intended that extensions of leases should be treated equally , irrespective of which of these purposes the plots were used for . This must carry considerable weight in our assessment here . Reference is made to the first voting judge ’s comments [ the leading judgment above ] on the weighing of the political considerations by ORG . I would nevertheless add that , although it is probably the case that social considerations would be of particular importance to permanent homes , having a holiday home also has considerable benefits in terms of well - being and welfare . It is illustrative of the assessment on this issue that counsel in the case has not attached noteworthy weight to distinctions regarding purpose . ”

The second applicant , PERSON , owns agricultural property , of which the outlying fields have been parcelled out as plots . CARDINAL plot was leased out for housing purposes for DATE , from DATE to DATE . On DATE the DATE ground rent amounted to ORG CARDINAL ( approximately EUR CARDINAL ) . The contract did not provide for a right to claim an extension of the lease and was silent on the question of future adjustments of the ground lease rent . The leased plot is located in an area containing several housing properties and is CARDINAL dekar in size . The plot has a shoreline adjoining LOC . It appears that the lessee resides outside GPE and uses the property as a holiday home . Originally she claimed the right to redeem the plot with effect from the expiry of the agreed term of lease . For the purpose of determining the amount payable in redemption , the parties agreed that they should each appoint an assessor . Based on the values determined by these assessors , the amount payable in redemption would be fixed at MONEY of the undeveloped plot value , as provided for in section QUANTITY of LAW .

Each of the parties accordingly arranged for the plot to be valued . On DATE the assessor appointed by the lessor estimated the market value of the undeveloped plot to be ORG CARDINAL ( approximately EUR CARDINAL ) , whereas the assessor appointed by the lessee on DATE estimated the market value of the undeveloped plot to be ORG CARDINAL,CARDINAL,CARDINAL ( approximately EUR CARDINAL ) .

Subsequent to ORG passing judgments in the leading case and the case involving the first applicant on DATE , the lessee informed counsel for the second applicant that she was no longer in favour of redemption at MONEY of the market value of the undeveloped plot . Instead , redemption was offered in an amount equal to the capitalised value of the ground rent based on a QUANTITY cent rate of interest on capitalisation , in other words compensation for redemption equal to CARDINAL times the ground rent , rounded off to a total of ORG CARDINAL ( approximately ORG CARDINAL,CARDINAL ) . On DATE the lessee gave notice claiming an extension of the lease on the same conditions as previously , pursuant to section CARDINAL of LAW . In a letter of CARDINAL DATE , the second applicant disputed the claim , referring to his intentions to bring the case before the ORG .

The third and fourth applicants , PERSON and PERSON , own an agricultural property with few agricultural resources . The property has no fields and the outlying areas make up a total of CARDINAL dekar , of which most consists of forest with little or no productivity . On CARDINAL DATE , the applicant spouses concluded a ground lease contract for DATE in respect of a plot of land consisting of CARDINAL sq . m , which had its own shoreline . It contained no clause regulating the future adjustment of the ground lease rent . The lessee built a holiday home on the plot . When the contract expired on DATE , the DATE ground rent amounted to ORG CARDINAL ( approximately EUR CARDINAL ) .

It appears that the rent was the main regular source of income on the property . The third applicant receives a disability pension .

NORP The contract contained no right to extension of the lease , but referring to the amended section CARDINAL of LAW , the lessee claimed an extension of the lease on unchanged conditions . Since the applicants objected , the lessee brought civil proceedings against them before ORG on DATE , which on DATE stayed the proceedings pending the outcome of the leading case before ORG .

By a judgment of DATE , ORG upheld the lessee ’s claim that she was entitled to extend the ground lease contract on the same terms as before . It observed inter alia :

“ The question whether section CARDINAL of LAW must be considered to lead to results which violate LAW was decided by ORG in GPE . CARDINAL . ORG held that section CARDINAL of LAW does not violate the LAW with regard to permanent homes . Further , ORG in GPE . DATE established that the same applied with respect to holiday homes .

Subordinate courts must rely on the interpretations made by ORG and ORG can not therefore uphold the [ third and fourth applicants’ ] submission . ”

On DATE ORG ( lagmannsrett ) found it clear that the third and fourth ORG appeal would not succeed and that it should therefore not be admitted for examination ( section CARDINAL ( CARDINAL ) of LAW ( tvisteloven ) .

In the meantime , on DATE the applicant spouses had arranged for a valuation of the undeveloped plot , which was found to have an estimated value of ORG ( approximately ORG CARDINAL,CARDINAL ) .

The fifth applicant , PERSON , is the landowner and lessor of CARDINAL plots for permanent housing which were leased out with effect from DATE . The plots are located in one of the most expensive areas in GPE . By way of illustration , she stated that in DATE a permanent home and the lease on CARDINAL of the plots of land had been sold for ORG MONEY ( approximately EUR CARDINAL ) . The agreed term of lease is DATE with a right for the lessees to claim an extension for DATE on new conditions . Pursuant to the amended section CARDINAL of LAW , however , all lessees have claimed extensions of their leases on unchanged conditions and unlimited in time .

On DATE the fifth applicant initiated a conciliation complaint before ORG , claiming that the lessees in question did not have the right to enjoy the same conditions as previously after extension of their leases . She submitted valuations of the undeveloped value of the various leased plots made on DATE , an overview of ground rents at the time of extension , as well as details of plot sizes , valuation amounts and ground rents as a percentage of the value of the individual plots . The values of the various undeveloped plots ranged from ORG CARDINAL ( approximately EUR CARDINAL ) for the lowest to ORG CARDINAL ( approximately EUR CARDINAL ) for the highest . The ground rents range from ORG CARDINAL ( approximately EUR CARDINAL ) per year to ORG MONEY ( approximately EUR CARDINAL ) per year .

On DATE ORG ruled that the dispute should be referred to ORG .

By a judgment of DATE ORG found in favour of the lessees and against the fifth applicant and , on DATE , ORG refused to admit her appeal for examination , for similar reasons to ORG and ORG in their respective judgment and decision mentioned above ( see paragraphs CARDINAL and CARDINAL above )

The sixth applicant , PERSON , owns agricultural property of which the outlying fields have been parcelled into plots for several permanent homes and holiday homes . They are situated close to Oslo Fjord , over which they have a view .

The lessees of CARDINAL plots for holiday homes and CARDINAL plots for permanent homes , with contracts entered into in DATE which were about to expire , initiated proceedings against the applicant before ORG claiming extension of the lease on the same conditions as previously and with no limitation in time , pursuant to LAW of LAW . All the ground lease contracts in question had been entered into in DATE for a term of DATE . CARDINAL of the contracts contained a provision for indexed regulation of the ground lease rent .

The values of the undeveloped plots ranged from ORG CARDINAL ( approximately EUR CARDINAL ) to ORG CARDINAL , ( approximately EUR CARDINAL ) . The ground rents ranged from ORG CARDINAL ( approximately ORG CARDINAL ) per year to ORG CARDINAL,CARDINAL ( approximately EUR CARDINAL ) per year .

The applicant maintained that the real market value of the CARDINAL plots of land was ORG CARDINAL ( approximately EUR CARDINAL ) and that as a consequence of section CARDINAL of LAW , the total economic value of his legal position related to the CARDINAL plots in question would be ORG CARDINAL ( approximately ORG MONEY ) , which is the capitalised present value of the unchanged total ground rent of ORG CARDINAL ( approximately EUR CARDINAL ) .

Against this background , the applicant disputed the ORG claim and submitted that section CARDINAL of LAW contravened LAW .

By a judgment of DATE ORG found in favour of the lessee and against the sixth applicant and , on DATE , ORG refused to admit his appeal for examination , for similar reasons to ORG and ORG in their respective judgment and decisions mentioned above ( see paragraphs CARDINAL and CARDINAL above )

The conclusion of ground lease contracts and the contractual relationship between the landowner / lessor and the lessee was regulated for the first time in a statute from DATE , which entered into force on DATE .

A new LAW was enacted in DATE and entered into force on DATE . Its section CARDINAL contained rules on the regulation of rent for ground lease which were mainly based on changes in the consumer price index but allowed increases based on other parameters in some situations ( see paragraph CARDINAL below ) . The new LAW also contained provisions granting the lessee the right to claim an extension when the agreed term of the lease expired ( former section CARDINAL for lessees of plots used for permanent homes and former section CARDINAL for lessees of plots used for holiday homes ) , and the lessor the right to introduce new conditions into the extended contract of lease .

NORP In its amended version as applicable at the material time , the DATE LAW read in so far as relevant :

Section CARDINAL

“ A ground rent that is unreasonably high in relation to what is customarily paid in the locality on new leases on similar plots on similar contractual terms can not be agreed or demanded . ”

Section CARDINAL

“ In a ground lease agreement concerning a main residence or DATE home each party may require that the rent be adjusted in accordance with changes in the general price level [ pengeverdien ] since the conclusion of the agreement . If the rent has been adjusted , it is the rent that has been lawfully charged since the last adjustment that may be adjusted in accordance with the changes in prices that have occurred since that time . If the parties unequivocally agreed that the rent should remain unchanged , or agreed to a lower adjustment than that suggested by changes in the general price level , this agreement shall apply instead .

If a ground lease contract concerning a plot of land to be used for a main residence home or a holiday home was concluded before DATE , the following provisions apply for the first adjustment after DATE :

If the adjustment is to be made in accordance with changes in the general price level , the lessor may require that it be made in accordance with changes that have occurred since the ground lease contract was concluded , even if the rent has been adjusted before .

The lessor may require that the rent be adjusted in accordance with what has unequivocally been agreed upon . Nonetheless , if the lease contract was concluded on or before CARDINAL DATE , the lessor may not require that the DATE rent be adjusted upwards beyond a maximum amount per dekar of ground or to an amount corresponding to inflation . The maximum amount according to the second sentence is ORG CARDINAL,CARDINAL , adjusted every turn of the year after DATE in accordance with inflation . This maximum also applies if the size of the plot is smaller than CARDINAL dekar .

“ In the case of leases on plots for permanent homes and holiday homes , the lessee has the same physical enjoyment of the leased plot as an owner for use within the purposes of the lease , unless otherwise stipulated in what has been agreed between the parties . ... ”

“ The lessee has the right to transfer the right to lease the plot to a third party unless otherwise stipulated in the agreement or the purpose of the lease . ”

“ The lessee has the right to mortgage the lease and the buildings existing now or in the future on the plot , unless otherwise stipulated by statute or under an agreement limiting the right to transfer . The mortgage must apply both to the right to lease the plot and to present and future buildings . ”

“ The lessee may establish any specific rights of disposal of the plot for third parties that with regard to type of use , scope and limitations in time lie within the lessee ’s own right of disposal , save as otherwise agreed . ”

“ The lessee may claim redemption of a plot for a permanent home or for a holiday home when DATE of lease have passed , unless a shorter time has been agreed upon , or when the term of the lease expires . After DATE of lease have passed , the lessee may then claim redemption of a plot for a permanent home at DATE intervals , and redemption of a plot for a holiday home at DATE intervals .

On expiry of the lease for such a plot that has been leased for the life of the lessee , the following may claim redemption :

a ) the spouse of the lessee , b ) heirs to the lessee , c ) a foster child who has the same position as an heir , d ) someone who for DATE has shared the same home as the lessee . ... ”

“ Instead of claiming redemption of a plot for a permanent home or a holiday home pursuant to section DATE when the term of the lease expires , the lessee , or those encompassed by section TIME paragraph , may claim an extension of the lease on the same conditions as previously . In the case of leases thus extended , section CARDINAL , first paragraph , concerning the term of the lease , shall apply . ”

[ The reference to section CARDINAL , first paragraph , on the term of the lease , entails that an extension of the lease on the same conditions as previously will be without restrictions in terms of time . ]

“ Upon redemption of a plot for a permanent home or a holiday home , the payment should be set at CARDINAL times the yearly ground rent at the time of redemption , unless a lesser amount has been agreed upon . If nothing else has been agreed upon , the parties may nevertheless claim that the redemption sum should amount to MONEY of the sales value of the undeveloped plot at the time of redemption , after deduction of any increase in value brought about by the lessee or others . The value of the plot must not be set higher than the price for which the land could have been sold , had it been permitted exclusively to erect the house or houses already erected on it .... “

At ORG ’s request to the Government , an assessment of LAW DATE was carried out , notably its section CARDINAL , DATE after its entry into force on DATE . ORG received various submissions from private individuals who had experienced , or had been notified of , considerable increases in the annual rent payable . There had also been media coverage of rent increases following the entry into force of the LAW . In the public review processes various organisations had pointed to the fact that a large number of plots were leased for a very low rent . A number of organisations had noted that the LAW was difficult to understand and generated a high level of conflict . The need for a simpler legal regime was highlighted .

In DATE ORG collected statistical material , the findings of which were summarised in the PERSON ( PERSON . nr . CARDINAL ( DATE ) p.CARDINAL ) , and carried out a survey aimed at lessees and lessors to establish sufficient facts for the proposed legal amendment ( to section CARDINAL ) . The following findings were highlighted as being some of the most important :

“ The ground lease rent is adjusted according to changes in the consumer price index in the majority of ground lease contracts .

CARDINAL CARDINAL per cent of the ground leases for permanent homes and CARDINAL of the holiday home ground leases contain clauses providing for other means of rent adjustment . In most cases this involves adjustment according to changes in the value of land . The figures provided by ORG show that MONEY of permanent home leases and MONEY of holiday home leases are subject to adjustment in other ways than by linkage to changes in the consumer price index .

Section CARDINAL has resulted in a dramatic increase in rent in contracts with ground value clauses . The average DATE level of rent in permanent home lease contracts containing such clauses , revised after the LAW came into force , has increased from ORG CARDINAL to around ORG QUANTITY per ground lease contract . For holiday home ground leases the average increase is somewhere between ORG CARDINAL,CARDINAL and ORG CARDINAL per contract ( the figures provided by lessors and lessees are inconsistent ) . The figures provided by ORG show an increase from approximately ORG to ORG CARDINAL per plot leased for holiday home purposes .

Somewhat more than CARDINAL per cent of permanent home leases are subject to an DATE rent below ORG CARDINAL,CARDINAL , while CARDINAL to MONEY are around ORG CARDINAL , and CARDINAL to CARDINAL per cent are between ORG CARDINAL,CARDINAL and ORG CARDINAL,CARDINAL . CARDINAL MONEY pay DATE rent in excess of ORG CARDINAL per dekar [ CARDINAL ORG ] . The figures from ORG are incomplete in this regard , yet they suggest that MONEY of ground leases are subject to DATE rent of less than ORG CARDINAL,CARDINAL . The average level of rent must , however , be seen in the light of the fact that a large number of contracts with ground value clauses are due to be adjusted in DATE ( adjustment , as a rule , occurring DATE ) .

CARDINAL MONEY of holiday home ground leases are subject to annual rent of less than ORG CARDINAL,CARDINAL , while PERCENT are between ORG CARDINAL,CARDINAL and ORG CARDINAL . Somewhat less than ten per cent are between ORG CARDINAL,CARDINAL and ORG CARDINAL , and MONEY between ORG CARDINAL,CARDINAL and ORG CARDINAL,CARDINAL . CARDINAL per cent of lessees pay more than ORG CARDINAL,CARDINAL per dekar . In the main bulk of contracts reported to ORG the rent lies between ORG CARDINAL and ORG CARDINAL,CARDINAL . Here , too , the figures must be read in light of the fact that a great number of contracts with ground value clauses are due to be adjusted in DATE .

CARDINAL per cent of permanent home leases and MONEY of holiday ground leases were entered into DATE . This has particular impact on the rules of redemption , as the conditions for redemption are linked to the time when the contract was entered into .

CARDINAL LOC impressions from the assessment

CARDINAL households in GPE lease ground for permanent or holiday home purposes . MONEY of permanent home leases are found in cities or other densely populated areas . These leases , and the holiday home leases in popular coastal areas , are increasingly marred by conflicts between lessees and landowners . A lot of the contracts are old and were entered into at a time when ground lease was a viable alternative for those individuals who were unable to finance the purchase of property , and prior to social development that forced real - estate prices in densely populated areas to unforeseen levels . DATE leased plots must be considered as permanently restructured due to the GPE work on the land and their considerable investment in housing on the plot . Lessors comprise traditional lessors , for instance in agriculture , but ground is also leased by professional real - estate investors , who own a number of leased plots .

The Ministry is of the opinion that the assessment has shown , importantly , a clear need for making the rules of redemption simpler . ... ”

Former section CARDINAL , which entered into force on DATE , contained a main rule enabling upward rent adjustment in accordance with changes in the consumer price index and an exception where it had unequivocally been agreed that there should be no adjustment of the rent , or where rent was to be adjusted by other means than by reference to the consumer price index . In such cases adjustment was to be done on the basis of the terms of the agreement in question . This applied in full for contracts entered into after CARDINAL DATE . For contracts entered into prior to CARDINAL DATE the new rule was subject to the modification that a rent “ ceiling ” of ORG CARDINAL per dekar was introduced for upward adjustment based on other parameters than correspondence with the consumer price index .

In the context of the revision of section CARDINAL , ORG considered CARDINAL alternative options , including whether to re - introduce a mandatory consumer - price - index - regulated adjustment system for ground lease contracts for permanent and holiday home purposes . There were several arguments in favour of this . After the former rent control system was repealed on DATE , many lessees had been faced with dramatic unexpected rent increases . Although the contracts had initially been entered into on the basis of possible upward adjustment of the ground lease rent to reflect increases in the value of the property , the long period with a system for public rent control in force had led to a situation where lessees were used to a gradual increase in rent in accordance with the consumer price index . The increasing discrepancy between ground lease rents subject to rent control and those indexed to the increase in property prices made dramatic inroads into the household budgets of numerous families and single people , subject to the regime introduced on DATE . This price trend was also seen in the rental market , but in the rental market the increase was more gradual , and there was at any rate a difference between the ordinary rental market and the ground lease market in that the lessee had built his or her own house upon the ground in question for his or her own use .

It was further observed that a minority of the contracts provided for adjustment by reference to factors other than the consumer price index and were concerned by this problem . For most of the contracts covered by the survey the rent level could be said to be high . Then the report went on to consider the arguments for and against introducing mandatory all - round rent control based on the consumer price index ( PERSON . nr . CARDINAL ( DATE ) pp . CARDINAL ) :

“ What first and foremost militates against a compulsory scheme for rent adjustment in correspondence with the consumer price index is the principle of the freedom of contract . Limitations to the freedom of contract principle will be more noticeable in those older contracts containing ground value clauses . In most such contracts , which have been the subject of public regulation since the entry into force of the new LAW DATE , the aforementioned proposed amendment to the act will entail downward adjustment of payable ground rent , bringing the rent back to its level at the time of the rent control scheme prior to DATE . A downward adjustment would undoubtedly be noticeable for lessors who have already adjusted the rent upwards to reflect the increase in property prices and also made arrangements accordingly . It should also be part of the overall consideration that section CARDINAL of LAW has enabled more lessors to make profit on property that for DATE has accrued very low income in terms of ground lease rent because of the previous rent control scheme . ORG would also like to add that the survey undertaken in DATE shows that the average level of rent charged , including rent subject to adjustment after DATE , corresponds to what was foreseen when section CARDINAL was amended in DATE . ORG will therefore not support the introduction of a mandatory adjustment scheme linked to the consumer price index for older contracts on the basis of the rent charged at the time the contract was entered into .

At the same time the assessment of LAW demonstrates that clauses linking rent adjustment to the increase in property prices are often conducive to disputes , and they may have ramifications unforeseen by the parties when the contract was entered into . Since LAW entered into force a number of disputes have arisen regarding the interpretation of adjustment provisions in ground lease contracts . Part of the problem seems to be that many contracts were entered into without any party having envisaged the possibility of the dramatic increase in property prices that has been seen in DATE , and its consequences for rent levels . In older contracts entered into by non - professional parties in particular , the wording of the contracts appears often to be haphazard and imprecise and thus of little use in determining questions that were not anticipated at the time . Such cases can naturally be left to the decision of the judiciary , but from the perspective of social economics it seems unfortunate to allocate such substantial resources to the settlement of such disputes , in terms of free legal aid and the workload on the courts . As the cases concern a significant social asset , namely the permanent or holiday homes of the lessees , considerable uncertainty may also be a source of unnecessary personal strain .

In the ORG ’s opinion , the third option mentioned in the letter carrying the proposal submitted for public review ( consumer price index regulation only in cases after the last adjustment has been made ) covers aspects related to foreseeability and the avoidance of legal disputes . [ ... ] Such random effects can be avoided by introducing a provision that entitles the lessor to adjust the rent upwards once in accordance with the original contract and subject to limitations already in force under LAW , before the consumer price index adjustment scheme comes into effect . In this way the rent charged in the transition period is brought , by way of a CARDINAL - off operation , to a level higher than that established under the prior rent control scheme repealed when LAW entered into force DATE . For more recently agreed ground lease contracts it will still be possible to agree upon a rent that reflects the value and appreciation of the land , but rent adjustment will subsequently be linked to changes in the consumer price index . Such a provision for older contracts will respect what has been agreed upon , while at the same time helping to achieve a uniform system of rent adjustment based on the consumer price index over time . This , it must be assumed , will result in fewer legal disputes and not give rise to unforeseen radical upward adjustments of ground rent .

The ORG proposes , then , this solution for ground lease contracts for permanent and holiday home purposes . The main rule of the proposal is a system of rent control linked to changes in prices . For the older contracts mentioned above , however , the ORG proposes introducing a CARDINAL - off operation in which what has been agreed upon between the parties will represent CARDINAL factor . Any subsequent adjustment after this CARDINAL - off operation should reflect price trends .

This solution does not , however , address the fact that ground lease rent has risen and will continue to rise in some ground lease contracts containing ground value clauses . This must be seen in context . ORG proposes the expansion and simplification of the rules of redemption . It is suggested that the price to be paid for redemption should be calculated having regard to the ground lease rent . A balancing of the interests of the lessors and the lessees suggests in the ORG ’s opinion that there should be no intervention in rent adjustment clauses in existing contracts more than what will follow from this proposal . ” [ Emphasis added . ]

Chapter CARDINAL , on the “ Calculation of the compensation for redemption ” , included the following observations ( PERSON . nr . CARDINAL ( DATE ) p. CARDINAL ) :

“ ORG considers that the provision on calculating compensation upon redemption must be seen in the light of the provisions on rent adjustment , the general conditions for redemption and the right to extend the lease . ORG assumes at the outset that these provisions , seen as a whole , must not substantially alter the present balance of interests in ground lease contracts . Several instances that have taken part in the public review process have also stressed this . In section CARDINAL the ORG proposes a considerable simplification of the conditions for redemption . At the same time , the ORG favors the introduction of a CARDINAL - off upward adjustment operation for contracts with ground value clauses , followed by the introduction of an adjustment scheme linked the consumer price index ( see section CARDINAL ) . This gives due regard to what has been agreed between the parties . With this point of departure in mind , the Ministry considers that it is possible to introduce a balanced provision for the calculation of compensation for redemption . ” [ Emphasis added . ]

The proposal for the existing section CARDINAL concerning the right for the lessee to claim an extension on the same conditions as previously without limitations in time was presented by ORG and ORG ( PERSON Justis- og DATE hereinafter referred to as ORG ) in DATE ( Ot.prpr . nr . CARDINAL ( CARDINAL ) - proposal no . CARDINAL to the PERSON , which is the larger division of ORG ) , stating inter alia ( at p. CARDINAL ) :

“ The ORG draws attention to the fact that the main aim of the proposal is to make it easier for more people to acquire ownership of the leased plots . In certain cases redemption would be such a heavy financial burden that the lessee should have other alternatives than terminating the lease agreement . Lessees who are not able to redeem the plot should , in the ORG ’s view , be secured a lasting right to dispose of the plot . This issue has not been of great interest until now , but this can be expected to change in DATE to come as more lease contracts expire . In the absence of absolute rules , the lessors will be faced with the choice between redemption , termination or continuation [ of the ground lease contract ] . As ORG sees it , this is an untenable legal situation and it is therefore proposed that the lessee should have a right to prolong the ground lease agreement . ORG has considered whether the landowner should have a right to set new conditions in the agreement , but has found that the lessee should be able to continue the lease agreement on the same terms . According to the ORG ’s assessment , social policy considerations on the side of the lessee should be decisive . If the lessor were to have the possibility to adjust the ground lease rent up to the market level , the lessees would in principle find themselves in the same financial straits as in the event of redemption where the costs of a loan exceed the DATE ground lease rent . ”

As regards the issue of constitutionality of the provision in section CARDINAL , the Bill to ORG stated ( p. DATE ) :

“ The PERSON entails some retroactive effect particularly for landowners who concluded ground leases before DATE , when no such right to extension existed . ORG has reasoned that the social considerations on the lessee ’s side weigh heavier than those on the landowner ’s side , and concludes that the proposal is consistent with LAW . The proposal is not considered to be more intrusive than the proposed rules on redemption , and on this point reference is made to LAW and the discussion of the relationship to the LAW in para . CARDINAL . ORG also stresses , inter alia , the social considerations that will apply , and that these are rules that relate to a long - term contractual relationship between the parties . ”

The PERSON proposed that payment upon redemption should be set at CARDINAL times the ground rent at the time of redemption , although the lessor should be able to claim a minimum of ORG CARDINAL , equal to ORG CARDINAL , for the plot ( section CARDINAL ) , which was to apply to all ground lease contracts irrespective of the value of the plot , of when the contract had been concluded , and of whether the contract was limited or unlimited in time . In this connection ORG stated ( p. CARDINAL ) :

“ As noted above , the fundamental purpose of the rules on redemption is already to ensure that lessees of plots for permanent homes and holiday homes are secured a lasting right to use the plot . It is probably the case that many lessees will not be in a position to redeem the plot if the costs of borrowing are significantly higher than the DATE ground rent . As noted above , the PERSON will entail some increase in the expenses of the lessee , depending on the prevailing level of interest rates , but it is estimated that it nevertheless lies within what most lessees with limited economic means should be able to afford . ”

The proposal concerning the minimum compensation of ORG CARDINAL was later amended by ORG to CARDINAL per cent of the sales value of the undeveloped plot at the time of redemption .

As regards the grounds given by ORG in DATE for supporting the proposed section CARDINAL in the PERSON granting the right for lessees to claim an extension on unchanged conditions instead of redemption , the recommendation presented to ORG by ORG ( Recommendation no . CARDINAL to PERSON ) p. CARDINAL ) contained the following :

“ The ORG majority , all except the members from ORG , agree with the ORG that lessees who are unable for financial reasons to purchase their plots under LAW of the new LAW should be secured a lasting right of disposal of the plot . The majority view is that a right of extension should be granted on the same conditions as referred to in the contract of lease . In assessing these matters , the majority has attached considerable weight to considerations of social policy in housing [ boligsosiale hensyn ] . The majority support the ORG ’s assessment of the situation with regard to the LAW on this point as on other points , and also refer to the comments above on the subject of the relationship to LAW . ”

LAW read as follows , in so far as relevant :

“ No law must be given retroactive effect . ”

“ If the welfare of the ORG requires that any person shall surrender his movable or immovable property for public use , he shall receive full compensation from the ORG . ”


Violation of Art. 6-1;Pecuniary damage - claim dismissed;Non-pecuniary damage - finding of violation sufficient;Costs and expenses partial award - Convention proceedings

DATE the applicant was the sole managing director of ORG ( “ ORG ” ) , a company which owned and controlled CARDINAL of the CARDINAL casinos licensed to operate in GPE . ORG was a subsidiary company of ORG plc ( “ ORG ” ) of which the applicant was also managing director . Both companies will hereafter be collectively referred to as GPE Clubs .

NORP In DATE a raid took place at the various premises of ORG . The raid was carried out by the police in the presence of officials of ORG for GPE ( “ the Gaming Board ” ) , a statutory body which inspects and monitors the gaming industry . A large quantity of documents were seized . In DATE ORG lodged objections with the clerk to ORG , with regard to ORG ’s DATE application for renewal of the licences it held in respect of each of its casinos . ORG also made cancellation applications in respect of the existing licences held by ORG .

A meeting was held between ORG and the non - executive directors of ORG and their legal advisors on DATE . As a result of this meeting , the applicant and the other executive directors ( with the exception of the finance director ) resigned with effect from DATE , on the understanding that such resignation was involuntary and constituted dismissal by ORG .

Subsequently an agreement was reached between ORG and ORG , whereby ORG would apply for new licences for the casinos , via re - constituted operating companies , to which application ORG would not object . If the applications were successful and new licences were granted by ORG , ORG would undertake to surrender its existing licences , thereby avoiding the necessity for the applications for cancellation or renewal to be heard .

ORG issued ORG with certificates of consent , which ORG were statutorily obliged to obtain from ORG as a pre - requisite to making an application to ORG for new licences . Objections to the issuing of new licences were made by a rival casino owner . However these objections were rejected and new licences were granted in DATE , after DATE hearing before ORG . ORG was represented at the hearing and expressed to ORG its support for the application of ORG , explaining the grounds on which ORG itself had granted ORG certificates of consent in the following terms :

“ In determining that it should issue certificates of consent ORG took into consideration , amongst other relevant factors , the degree to which ORG had addressed the ORG ’s grave concerns at the matters of complaint referred to above , and in particular had in mind the following :

Those executive directors of ORG and of [ ORG ] who in the ORG ’s view carried the principal responsibility for the matters of complaint ... [ the applicant was named along with CARDINAL others ] have left the company and relinquished their management shares : ( ..... )

ORG viewed the matters raised in their cancellation applications extremely seriously . However they are satisfied that the practices that were unacceptable have now been eradicated and that those individuals responsible for encouraging or tolerating them have been removed . ”

In DATE the Chairman of ORG , PERSON , addressed ORG at their DATE luncheon . Her speech referred to ORG and commented :

“ We [ ORG ] satisfied ourselves that the practices we and the Police had regarded as unacceptable had ceased , that persons regarded by ORG as not fit and proper had been removed ... . ”

As a result of this speech , the applicant ’s legal advisors entered into correspondence with ORG solicitors , on the basis that the speech was defamatory . ORG alleged that the “ persons ” referred to were minority shareholders and no reference to the applicant was intended . The applicant did not accept this explanation , however defamation proceedings were not commenced .

By a letter of CARDINAL DATE , the applicant ’s legal advisors received written notice that ORG was considering whether the applicant personally was a fit and proper person to hold the ORG ’s certificate of approval , as required by LAW DATE , in order to hold a management position in the gaming industry . By a letter dated DATE , ORG informed the applicant formally that it was “ minded to revoke ” the applicant ’s LAW certificates and that the applicant would be given the opportunity to state his case against revocation either in writing or orally at an interview before ORG ( “ a LAW hearing ” ) .

The letter detailed the matters which ORG wished to discuss with the applicant and also referred to the particulars of ORG complaints in the application for cancellation of ORG ’s licences ( the hearing of which had , in fact , never taken place ) . The complaints , numbered CARDINAL to BCARDINAL , claimed , inter alia , that there had been breaches of LAW of LAW DATE , in that cheques had been accepted without any expectation that they would be met promptly ( CARDINAL ) ; that the applicant had been involved in granting cheque cashing facilities to members without proper investigation of their creditworthiness ( BCARDINAL ) ; that cheques had been accepted which exceeded the ORG cheque cashing facility ( BCARDINAL ) ; that third party cheques had been accepted in a way which would permit circumvention of DATE Guidelines of ORG ( BCARDINAL ) ; that NORP players had been assisted in breaching NORP exchange control regulations ( BCARDINAL ) ; that gifts or hospitality had been made to substantial players in breach of further DATE LAW BCARDINAL ) ; and that the method for computing the “ cash drop ” in casinos produced inaccuracies , and was open to abuse ( BCARDINAL ) . Examples were given .

The applicant ’s legal advisors objected to ORG presiding over the LAW hearing , suggesting that an independent tribunal be set up as an alternative . The applicant ’s principal objection was based on the fact that ORG had already publicly expressed the view ( at the hearing before ORG ) that the applicant was not a fit and proper person to remain as an executive director of ORG . As such , the applicant contended , ORG could not be considered an impartial tribunal appropriate to consider the issue of whether the applicant ’s LAW certificates should be revoked .

ORG rejected the request for an independent tribunal and a Section CARDINAL hearing commenced on DATE before a panel of CARDINAL , all members of ORG ( “ the Panel ” ) . The hearing was conducted in private and lasted for DATE . The applicant was represented by senior counsel . ORG solicitors , a senior ORG official and a representative of ORG accountants also attended the hearing .

By a letter dated DATE , the applicant was informed that ORG did not consider the applicant to be a fit and proper person to continue to hold the ORG ’s certificates of approval and that , accordingly , ORG would revoke his LAW certificates within DATE of receipt of the letter . This letter detailed the matters which had concerned ORG and the complaints that it deemed were established against the applicant .

The effect of the revocation of the LAW certificates was that the applicant was unable to obtain employment in any sector of the gaming industry in GPE or in any jurisdiction which had a relationship with the GPE gaming authorities .

By an application dated DATE , the applicant sought leave to apply for judicial review of the decision of ORG to revoke his LAW certificates . The decision was challenged on the grounds that the ORG was biased , or had the appearance of bias , and that its findings were vitiated by errors of law and were irrational .

In the course of the judicial review proceedings a document entitled “ LOC to Minutes of ORG of ORG for GPE , ” dated DATE , was exhibited to an affidavit sworn by the Chairman of ORG . This document recorded that ORG had taken a decision at its meeting on DATE that it had :

“ sufficient evidence before it to conclude that [ the applicant ] ... was not a fit and proper person to be a director of a casino company . ”

All the members of the Panel who presided over the Section CARDINAL hearing were present at the ORG meeting and were parties to this decision , which was made prior to the hearing itself .

The application for judicial review was dismissed on DATE by Mr Justice PERSON after a hearing lasting over DATE . He delivered CARDINAL separate judgments in respect of the applicant ’s appeal . The first judgment dealt with the scope of the phrase “ a fit and proper person ” in Schedule CARDINAL of LAW DATE . The second judgment considered the applicant ’s claim that he had a “ legitimate expectation ” that ORG would be precluded from taking account of any breaches of its guidelines unless the breaches were unlawful . The third judgment which dealt with “ ORG ” challenges and allegations of bias runs to CARDINAL pages . The judgment of ORG stated that the ambit of judicial review was such that he was not concerned to review findings of fact as on an appeal , but rather to assess whether the findings of the ORG disclosed illegality , irrationality ( referred to as “ ORG unreasonableness ” ) or procedural impropriety .

NORP On CARDINAL of the third judgment , PERSON dealt with the applicant ’s “ ORG ” challenges to the findings in respect of the various complaints made of him .

By way of example , it was accepted that cheques drawn by CARDINAL player , a Mr S , on a NORP and a NORP bank were not cleared within DATE after payment into a NORP bank , as would be the normal course of events . Rather , the average time for clearance was DATE . The ORG found that this practice breached LAW of LAW , which prohibits credit betting save when a cheque is exchanged for tokens . The applicant alleged that the cheques he accepted were not shams , as none of the NORP cheques was ever dishonoured . The judge found that the ORG ’s conclusion - that what took place amounted to an agreement between Mr S and ORG , such that LAW was breached - was a conclusion it was entitled to reach .

CARDINAL pages of the third judgment were devoted to the issue of bias . Jowitt J. described the test of bias under LANGUAGE law in the following terms ( pp . CARDINAL of the judgment ) :

“ [ Counsel for the applicant ] submits that the decision to revoke the applicant ’s LAW certificates of approval should be quashed because the ORG was biased . The grounds on which leave to move for judicial review were granted asserted firstly that the ORG could not and did not approach its decision with objectivity and impartiality . Secondly , it was asserted that whether or not there was actual bias the applicant reasonably believed there was and that the ORG should have had regard to the appearance of bias which had been created by its actions ...

There was no disagreement between the parties as to the approach the court should adopt when bias is alleged . It is a CARDINAL stage test . The applicant has first to show from the evidence that there is an appearance of bias . NORP v. PERSON Coroner Ex parte PERSON [ DATE ] CARDINAL All ER CARDINAL . [ Counsel for ORG ] properly and realistically accepts that in the light of the available evidence the applicant has surmounted this hurdle . Having done so , he has to go on to show that on a proper examination by the court of the evidence before it there is demonstrated a real danger of injustice having occurred as a result of bias ... [ The analysis in that case of ] the decision of ORG in NORP v. PERSON [ DATE ] AC CARDINAL ... illuminates my task in relation to this second stage .

‘ ( CARDINAL ) Any court seized of a challenge on the ground of apparent bias must ascertain the relevant circumstances and consider all the evidence for itself so as to reach its own conclusion on the facts . ...

( CARDINAL ) In reaching its conclusion the court ‘ personifies the reasonable man’ .

( CARDINAL ) The question on which the court must reach its own factual conclusion is this : is there a real danger of injustice having occurred as a result of bias ? By ‘ real’ is meant not without substance . A real danger clearly involves more than a minimal risk , less than a probability . One could , I think , as well speak of a real risk or a real possibility .

( CARDINAL ) Injustice will have occurred as a result of bias if ‘ the decision - maker unfairly regarded with disfavour the case of a party to the issue under consideration by him’ . I take ‘ unfairly regarded with disfavour’ to mean ‘ was pre - disposed or prejudiced against CARDINAL party ’s case for reasons unconnected with the merits of the LOC .

( CARDINAL ) A decision - maker may have unfairly regarded with disfavour one party ’s case either consciously or unconsciously . Where , as here , the applicants expressly disavow any suggestion of actual bias , it seems to me that the court must necessarily be asking itself whether there is a real danger that the decision - maker was unconsciously biased .

( CARDINAL ) ... the court is [ not ] concerned strictly with the appearance of bias but rather with establishing the possibility that there was actual although unconscious bias . …

( CARDINAL ) It is not necessary for the applicant to demonstrate a real possibility that the ... decision would have been different but for the bias ; what must be established is the real danger of bias having affected the decision in the sense of having caused the decision - maker , albeit unconsciously , to weigh the competing contentions , and so decide the merits , unfairly’ . ”

Jowitt J. then applied the test of bias which he had set out to the facts of the case , and concluded that , on the evidence before him , he could not say that the applicant had established that there was a real danger of injustice having occurred as a result of bias . He concluded that there was no unconscious bias on the part of any of the ORG members .

Jowitt J. stated , further , that if , contrary to his finding , there was unconscious bias on the part of the ORG , the “ doctrine of necessity ” fell to be considered . He said :

“ When a body is charged by statute with the power or duty , which can not be delegated , to make a decision in circumstances in which a question of bias arises because :

( i ) in pursuance of that statutory power or duty an initial view has been formed upon a matter affecting the interests of someone in respect of whom the body in the exercise of its statutory power or duty has thereafter to make a decision , or final decision , after receiving and considering representations which he is entitled to make or

( ii ) in the exercise of a statutory power or duty to make a decision a conflict arises between the interests of another or others which have to be taken into account and the body ’s own interests :

the decision will not be liable to be impugned on account of bias provided that :

( i ) if only some of those charged with the power or duty to decide are potentially affected by bias such of them as can lawfully withdraw from the decision making do so and

( ii ) those of the decision makers who are potentially affected by bias but can not lawfully withdraw use their best endeavours to avoid the effect of bias and , consistently with the purpose for which its decision has to be made the body takes what reasonable steps are open to it to minimise the risk of bias affecting them … ”

Jowitt J. indicated that if , contrary to his finding , there was unconscious bias on the part of the ORG , the doctrine of necessity would apply , and the decision of the ORG would stand . Counsel for the applicant submitted before PERSON that the ORG had failed to take the reasonable step of appointing an independent panel to hear evidence and report to the ORG . PERSON rejected the submission , on the grounds that no useful reference could have been made to an independent tribunal which did not involve an impermissible delegation .

In respect of all other allegations brought by the applicant , PERSON concluded that the applicant had failed to establish that the ORG ’s decision was irrational or unreasonable or to make out any sufficient ground for judicial review . PERSON noted that , by trying to frame his allegations in the context of ORG unreasonableness , the applicant was in fact making an impermissible attempt to re - argue the case as though on appeal in order to re - examine the factual merits of the case .

ORG , after an oral hearing on DATE , refused an application for leave to appeal from ORG decision . PERSON ( with whom ORG agreed ) held , on the “ doctrine of necessity , ” as follows :

“ I am prepared to assume in favour of [ the applicant ] that he would have an arguable case sufficient to justify leave to appeal , that there was a real risk that the decision of the ORG had been actuated by bias even though they were not in fact biased against him . That would leave the question of how the doctrine of necessity would be applied to the facts of the case .

[ Counsel for the applicant ] did not seek to suggest that the propositions of law which ORG enunciated , and which I have quoted , were not accurately formulated by him , but he sought to challenge the final conclusion , to which I have just referred , that there could have been a useful reference to an independent ORG which did not involve an impermissible delegation . The question of bias , therefore , depends on the very limited point on whether it is arguable that Jowitt J was wrong in that respect . I am bound to say that , on that limited point , I think he was manifestly right . The decision for ORG was , at DATE , whether or not Mr PERSON was a fit and proper person . That could not be delegated to an independent panel and if they were actuated by bias , apparent or real , then the decision would still have to be made by them . Therefore , on the doctrine of necessity , which is accepted , there could have been no meaningful independent panel and the decision would stand because the decision has to be made by ORG and could not be delegated to the independent tribunal . It seems to me that there is no arguable point , susceptible on this part of the case , which would justify giving leave to appeal . ”

ORG for GPE ( “ the Gaming Board ” ) is a statutory body , established under LAW DATE ( “ the DATE LAW ) to inspect and monitor the gaming industry . In order for any company to obtain the requisite gaming licence for LOC , a certificate must first be issued by ORG consenting to the company applying for such a licence ( Schedule CARDINAL , paragraph CARDINAL ( CARDINAL ) of LAW ) .

Under LAW of the DATE Act ORG issues certificates to individuals in order that they be permitted to hold certain positions in the gaming industry . A certificate , once issued , continues in force unless and until it is revoked . ORG may revoke the certificate at any time if it appears to ORG that the person to whom it relates is not a fit and proper person to perform the specified function or act in the specified capacity ( Schedule CARDINAL , paragraph CARDINAL of LAW ) . CARDINAL days’ written notice of the revocation must be given to the certificate holder . ORG has developed a procedure whereby an individual is sent a letter in which the ORG states that it is minded to revoke his certificate . This is followed by the submission of written representations and/or an oral hearing .


Violation of Art. 6-1 (access);Not necessary to examine Art. 6-1 (publicly);Damage - finding of violation sufficient;Costs and expenses partial award - domestic proceedings;Costs and expenses partial award - Convention proceedings

ORG On DATE Mr PERSON was stopped by the police after he had parked his car at the side of the road with its headlights on and the engine running . He refused to submit to a breath test . In a " sentence order " ( PERSON ) of the same day the GPE district authority ( ORG ) imposed on him a fine of CARDINAL NORP schillings ( ORG ) with TIME imprisonment in default of payment , for an offence under section CARDINAL(CARDINAL)(b ) taken together with section CARDINAL(CARDINAL ) of FAC ( Straßenverkehrsordnung - see paragraphs CARDINAL and CARDINAL below ) .

ORG The applicant appealed against that decision to the PERSON regional government ( PERSON ) , which dismissed the appeal on DATE .

ORG On DATE Mr PERSON applied to ORG ( Verwaltungsgerichtshof ) . He complained , in particular , that the impugned decision was unlawful and that there had been a procedural irregularity .

On DATE ORG quashed the decision of the regional government ( section ORG ) , sub - paragraphs CARDINAL and CARDINAL , of LAW ( Verwaltungsgerichtshofsgesetz ) - see paragraph CARDINAL below ) and referred the case back to it .

ORG The PERSON regional government , giving a second ruling on DATE , upheld the GPE district authority 's decision on the issue of guilt , but reduced the fine to ORG CARDINAL,CARDINAL and the penalty in default to TIME imprisonment .

ORG On DATE the applicant applied to ORG ) . He complained of an infringement of the right of property , of the principle that all citizens are equal before the law and of the right to a " fair procedure " in criminal proceedings under LAW ) of the LAW .

On DATE , at the conclusion of a consideration of the case in private , ORG declined to accept the appeal for adjudication ( Article CARDINAL para . CARDINAL of LAW ( Bundes - Verfassungsgesetz ) - see paragraph CARDINAL below ) , since , in view of GPE 's reservation in respect of LAW , it did not have sufficient prospects of success ; moreover , the case did not lie outside the jurisdiction of ORG .

ORG At Mr PERSON 's request , it referred the application to ORG on DATE .

ORG Reiterating in substance the arguments he had set out before ORG , the applicant complained , in particular , of a faulty assessment of the evidence by the administrative authority concerned .

ORG ruled for the second time and dismissed the appeal , after proceedings that were wholly in writing ; the applicant had not asked it to hold a hearing . It gave the following reasons :

" However , having regard to ORG limited supervisory power in proceedings relating to an application for review of an administrative decision , it is not for the court to ascertain whether the assessment made of the evidence in a given case is correct in the sense , for example , that a statement which incriminates the applicant corresponds to the facts and not the reply ( decision of CARDINAL DATE delivered by a full court , PERSON . CARDINAL/CARDINAL/CARDINAL ) .

Accordingly , the applicant 's complaint that he did not speak to the reporting police officer about a TIME 's drinking session can not be entertained .

The respondent authority was entitled , without disregarding the requirement that the assessment of the evidence has to be conclusive , to draw from the established facts mentioned above the conclusion that objective circumstances - and not merely the subjective belief of the reporting police officer - supported the suspicion that the applicant was under the influence of drink .

As regards the applicant 's complaint that his lawyer was not allowed to examine the witness PERSON in the proceedings before the authority , reference is made to ORG settled case - law , according to which neither the holding of a hearing nor the possibility of examining witnesses is an essential part of lawful administrative criminal proceedings ( see the decision of CARDINAL DATE , PERSON . CARDINAL/CARDINAL/CARDINAL , and the one of CARDINAL DATE , GPE . CARDINAL/CARDINAL/CARDINAL ) .

As to the alleged unconstitutionality of GPE 's reservation in respect of LAW ) of ORG , reference is made to the decision delivered by a full court on DATE , ORG no . CARDINAL

Since the alleged unlawfulness of the impugned decision has not been made out in the application , it falls to be dismissed as unfounded , under section CARDINAL(CARDINAL ) of LAW .

ORG Under LAW DATE it is an offence for any person to drive a vehicle if the proportion of alcohol in his blood or breath is equal to or QUANTITY respectively . The same section also lays down the conditions for the use of breathalysers and blood tests .

ORG In its DATE version , section CARDINAL(CARDINAL ) of the Act provided :

" It shall be an administrative offence ( PERSON ) , punishable with a fine of not CARDINAL and not more than MONEY or , in default of payment , with DATE imprisonment , for any person

( b ) to refuse to submit to a breath test where the conditions laid down in section CARDINAL are satisfied ;

ORG In DATE , at the time when ORG ratified LAW ( see paragraph CARDINAL below ) , section CARDINAL of LAW ( ORG ) provided : " Every driver shall be under a duty to pay reasonable heed to other road users and to display the care and diligence necessary to ensure the maintenance of order , safety and a proper flow of traffic . "

ORG Article CARDINAL para . CARDINAL of LAW ( Bundes - Verfassungsgesetz ) provides :

" Hearings by trial courts in civil and criminal cases shall be oral and public . Exceptions may be prescribed by law . "

ORG By Article CARDINAL para . CARDINAL of LAW , ORG , when an application ( Beschwerde ) is made to it , has to determine whether an administrative decision ( Bescheid ) has infringed a right guaranteed by the LAW or has applied regulations ( Verordnung ) contrary to the law , a law contrary to LAW or an international treaty incompatible with NORP law .

Article CARDINAL para . CARDINAL provides :

" Up to the time of the hearing ORG may by means of a decision ( ORG ) decline to accept a case for adjudication if it does not have sufficient prospects of success or if it can not be expected that the judgment will clarify an issue of constitutional law . The court may not decline to accept for adjudication a case excluded from the jurisdiction of ORG by Article CARDINAL . "

ORG By LAW para . CARDINAL of LAW , ORG has jurisdiction to hear , inter alia , applications alleging that an administrative decision is unlawful .

Section CARDINAL(CARDINAL ) of the Administrative Court Act provides , in particular , that at the end of the preliminary proceedings ( GPE ) ORG must hold a hearing where the applicant makes a request to that effect .

Section CARDINAL(CARDINAL ) reads as follows :

" Notwithstanding a party 's application under subsection ( CARDINAL ) , ORG may decide not to hold a hearing where

ORG the proceedings must be stayed ( section CARDINAL ) or the application dismissed ( section CARDINAL ) ;

ORG the impugned decision must be quashed as unlawful because the respondent authority lacked jurisdiction ( section CARDINAL(CARDINAL)(CARDINAL ) ) ;

ORG the impugned decision must be quashed as unlawful on account of a breach of procedural rules ( section CARDINAL(CARDINAL)(CARDINAL ) ) ;

ORG the impugned decision must be quashed because its content is unlawful according to the established case - law of ORG ;

ORG neither the respondent authority nor any other party before the court has filed pleadings in reply and the impugned decision is to be quashed ;

ORG it is apparent to the court from the pleadings of the parties to the proceedings before it and from the files relating to the earlier administrative proceedings that a hearing is not likely to clarify the case further . "

ORG - paragraphs CARDINAL of section CARDINAL ) were in force in DATE ; sub - paragraphs CARDINAL and CARDINAL were inserted in DATE and sub - paragraph CARDINAL in DATE .

Section CARDINAL(CARDINAL ) of the Administrative Court Act provides :

" In so far as ORG does not find any unlawfulness deriving from the respondent authority 's lack of jurisdiction or from breaches of procedural rules ( section CARDINAL(CARDINAL)(CARDINAL ) and ( CARDINAL ) ) ... , it must examine the impugned decision on the basis of the facts found by the respondent authority and with reference to the complaints put forward ...

If it considers that reasons which have not yet been notified to one of the parties might be decisive for ruling on [ one of these complaints ] ... , it must hear the parties on this point and adjourn the proceedings if necessary . "

Section CARDINAL(CARDINAL ) of the same LAW states that , save as otherwise provided , ORG must either dismiss an application as ill - founded or quash the impugned decision .

By section ORG ) ,

" The Administrative Court shall quash the impugned decision if it is unlawful

ORG by reason of its content , [ or ]

ORG because the respondent authority lacked jurisdiction , [ or ]

ORG on account of a breach of procedural rules , in that

( a ) the respondent authority has made findings of fact which are , in an important respect , contradicted by the case file , or

( b ) the facts require further investigation on an important point , or

( c ) procedural rules have been disregarded , compliance with which could have led to a different decision by the respondent authority . "

ORG If ORG quashes the impugned decision , " the administrative authorities [ are ] under a duty ... to take immediate steps , using the legal means available to them , to bring about in the specific case the legal situation which corresponds to ORG view of the law ( PERSON ) " ( section CARDINAL(CARDINAL ) ) .

ORG In a judgment of CARDINAL DATE ( G CARDINAL/CARDINAL ) ORG held :

" From the fact that it has been necessary to extend the reservation in respect of LAW to cover the procedural safeguards of LAW article CARDINAL ) of the LAW , because of the connection between those CARDINAL provisions ( article CARDINAL , article CARDINAL ) , it follows that , conversely , the limited review ( die ( bloß ) nachprüfende PERSON ) carried out by ORG or ORG is insufficient in respect of criminal penalties within the meaning of the Convention that are not covered by the reservation . "

ORG Pursuant to LAW , administrative courts called " independent administrative tribunals " ( ORG ) were set up in the Länder with effect from DATE . The functions of these tribunals include determining both the factual and the legal issues arising in cases concerning administrative offences ( ORG ) .

ORG The instrument of ratification of the Convention deposited by ORG on DATE contains , inter alia , a reservation worded as follows :

" The provisions of LAW shall be so applied that there shall be no interference with the measures for the deprivation of liberty prescribed in the laws on administrative procedure , BGBl [ ORG ] No . CARDINAL , subject to review by ORG or ORG as provided for in LAW . "