Olha Stupak and Yevhen Petrov Spoke About the Cases of Compensation for Damaged Property in Eastern Ukraine

Judges of the Civil Cassation Court within the Supreme Court Olha Stupak and Yevhen Petrov took part in the IV Judicial Forum "The Administration of Justice in the Context of Armed Conflict in Eastern Ukraine". The event, which took place on September 16, 2021, both offline and online, was organized with the support of the United Nations Development Program (UNDP) in Ukraine.

Olha Stupak noted that the problems citizens currently faced with the protection of their rights violated as a result of the armed conflict in eastern Ukraine could not be resolved by courts alone. The situation requires active action by the legislative and executive authorities as well.

But the judiciary is the first to respond to these challenges. One of the main problems is compensation by the state for the damage caused by the destruction of citizens' homes in connection with the Anti-Terrorist Operation (ATO) / Joint Forces Operation (JFO). And the complexity of this problem is not the difficulty of determining the amount of compensation, but the lack of legal regulation of such relations.

The speaker cited normative legal acts on the legal regime of ATO / JFO and noted that the court, resolving certain disputes, must first establish the nature of legal relations. In accordance with the current regulatory framework, the plaintiffs in the cases over compensation of damage referred to Art. 19 of the Law of Ukraine "On Combating Terrorism" and the provisions of the Code of Civil Protection of Ukraine, since a resolution of the Cabinet of Ministers of Ukraine introduced an emergency state in the conflict territory.

Olha Stupak drew attention to the resolution of the Grand Chamber of the Supreme Court of September 4, 2019 in case No. 265/6582/16-ц (proceedings No. 14-17цс19) which reached a legal conclusion on the absence of a real mechanism and procedure for compensation for damaged property due to armed conflict in eastern Ukraine. However, the Grand Chamber of the Supreme Court noted that it did not prevent a person who believed that a certain positive obligation had not been fulfilled in relation to his/her ownership of such property from demanding compensation from the state for this non-compliance under Art. 1 of the First Protocol to the Convention for the Protection of Human Rights and Fundamental Freedoms.

Following the adoption of this decision, the Civil Cassation Court within the Supreme Court considered all similar cases in which it concluded that since the state had not fulfilled its positive obligation to create a mechanism for compensation of relevant damages, it should pay compensation to the plaintiffs.

The judge also focused on the resolution of the Civil Cassation Court within the Supreme Court of March 4, 2020 in case No. 237/557/18-ц, in which the court ruled a special decision. This resolution recommends that the Cabinet of Ministers of Ukraine should develop a special procedure for compensation for property damaged as a result of a terrorist act, a procedure for payment of such compensation, and clear conditions necessary for claiming such compensation from the state.

By resolution of September 2, 2020 No. 767 the Cabinet of Ministers of Ukraine reworded the resolution of the Cabinet of Ministers of Ukraine of December 18, 2013 No. 947 “On Approving the Procedure for Granting and Determining the Amount of the Monetary Assistance or Compensation” and defined this procedure. "We were pleased that the government did not remain indifferent to a special decision of the Supreme Court," said Olha Stupak.

In addition, the speaker thanked the judges of the first and appellate instances who work in the east of Ukraine in difficult conditions and ensure high-quality court proceedings. The judge noted that the armed conflict had caused a lot of procedural problems for the courts. In particular, there was the issue of notifying the participants in the process on the territory uncontrolled by Ukraine, involving the body of guardianship and custody in the consideration of family disputes concerning children who are in this territory, and so on. The courts have resolved these issues and are considering the relevant cases.

The courts have also had to consider new categories of cases that did not exist before: the establishment of the facts of birth and death, forced displacement from the temporarily occupied territory, termination of employment, and so on. Olha Stupak cited Supreme Court resolutions on such cases (see presentation).

Yevhen Petrov said that so far the Supreme Court had adopted more than 40 decisions in cases involving claims for compensation for property damaged as a result of the armed conflict in eastern Ukraine. The amount of compensation in each of them is different - from 40 to 120 thousand UAH. In general, the amount of compensation awarded is UAH 1,520,000. The speaker explained that the different amounts of compensation were due to the different circumstances of the cases.

The judge drew attention to the fact that in all these cases the claim was precisely for compensation for property damaged. But in accordance with Art. 1166 of the Civil Code of Ukraine to obtain such compensation, the plaintiff must prove the tort. However, the Supreme Court, after finding that there was no real effective mechanism for compensating for the damage caused by the armed conflict, concluded that it was necessary to recover compensation for the state's failure to fulfill its positive obligation to protect property.

Yevhen Petrov also noted that sometimes the courts were criticized for the fact that the compensation awarded did not fully cover the damage caused by the destruction of property. But the Court notes that it is a matter of awarding compensation from the state. This does not preclude a person from seeking compensation for the damage caused in the future.  

Responding to questions about the possibility of receiving non-pecuniary damage for the destroyed property, the speaker noted that, in his opinion, the compensation covered the moral suffering of the person who had received it. "It was precisely for the purpose of obtaining compensation for the failure of the state to comply with its positive obligations that the individual received a certain satisfaction from the state which included both a material aspect and a moral one", the judge noted.

The Programme Director of the Ukrainian Institute for Human Rights, Valeriya Lutkovska, asked the judges whether it was possible to obtain compensation if the damaged property had not been privately owned by a person and he/she had had a warrant for the right to use the apartment. Accordingly, in terms of the Convention and the case law of the European Court of Human Rights it is property, but in terms of our legislation it is not. Yevhen Petrov noted that the Supreme Court applied the concept of property within the meaning of Art. 1 of the First Protocol to the Convention, applying the case law of the European Court of Human Rights, which allowed the said persons to apply to the court with such claims.

After a speech by Volodymyr Khorbaladze, the Coordinator of Housing, Land and Property Issues of the Norwegian Refugee Council, Olha Stupak asked him if the prospect of land plots on which the objects destroyed as a result of the armed conflict were located was discussed at working meetings with government officials, parliament representatives. She explained that in case a person received compensation for destroyed property, the Code of Civil Protection of Ukraine provided for the waiver of such property in favor of the state. "But the prospect of the land plot in such cases is unknown. This issue is relevant given that the opening of the land market will affect the value of such land plots," the judge said.

Volodymyr Khorbaladze replied that the organization he represented had asked the executive to resolve the issue. However, today the government's priority is to further improve the mechanism of compensation for damaged housing. 

Olha Stupak noted that the issue would soon arise before the executive, the legislature and the judiciary. "It is better for it to be resolved before the relevant disputes reach the Supreme Court which will be forced to resolve them in the absence of legal regulation," the judge said and drew attention to the case law on the unity of the legal prospect of the land plot and real estate located on it.

Photo: Andriy Kriepkykh / UNDP in Ukraine