Damages Caused by Forced Alienation of Property in Connection with Epizootics Are Subject to Compensation from the State Budget

By the judgment of the Commercial Court of Zaporizhzhia Oblast, upheld by the ruling of the Central Commercial Court of Appeal, the claim of LLC "Leader" against the state represented by the Zaporizhzhia District State Administration of Zaporizhzhia Oblast was partially satisfied. The damages caused by the emergency and the adoption of decisions by the State Emergency Anti-Epizootic Commission under the Novomykolaiv District State Administration on the introduction of quarantine and removal of agricultural animals infected with the causative agent of African swine fever were also recovered from the state budget of Ukraine in favour of the plaintiff.

The court decisions are motivated by the fact that the provisions of Art. 353 of the Civil Code of Ukraine are to be applied to contentious legal relations, since the case file confirms the existence of an emergency in the form of epizootic and, as a result, forced alienation of property from the owner on the basis of and in accordance with the procedure established by law, that is, requisition. According to Art. 49 of the Law of Ukraine On Veterinary Medicine, property damage (losses) caused by the introduction of quarantine (quarantine restrictions) of animals or in connection with procedures and works on the elimination and prevention of quarantine diseases, is subject to compensation from the state budget of Ukraine.

The Commercial Cassation Court within the Supreme Court dismissed the cassation appeal of the Deputy Head of the Zaporizhzhia Oblast Prosecutor's Office, and upheld the appealed court decisions.

The court of cassation concurred with the finding of the courts of previous instances that there were legal and factual grounds for recovery of the plaintiff's damages and pointed to the fact that paragraphs 6, 11 of the Procedure for the Use of the Budget Reserve Fund approved by the Cabinet of Ministers of Ukraine dated March 29, 2002, No. 415, which established compensation for damages on a reversible basis, contradicted Art. 22 and part 1 of Art. 353 of the Civil Code of Ukraine, according to which damages must be reimbursed in full. Neither Art. 353 of the Civil Code of Ukraine nor Art. 49 of the Law of Ukraine On Veterinary Medicine provide that such damages are reimbursed on a reversible basis.

Therefore, in accordance with part 4 of Art. 4 of the Civil Code of Ukraine, paragraph 11 of this Procedure may not be applied to the contentious legal relations. The legal relations on compensation for damage from losses of livestock, raw materials, materials and semi-finished products due to the introduction of quarantine (quarantine restrictions), which consists in eliminating the outbreak of African swine fever virus by completely destroying the entire pig population, are subject to Art. 353 of the Civil Code of Ukraine.

In addition, compensation for damages on the terms of return would be contrary to Art. 13 of the Convention for the Protection of Human Rights and Fundamental Freedoms, as this would result in ineffective legal protection of violated rights. Such protection would be illusory.

The text of the resolution of the Commercial Cassation Court within the Supreme Court of December 14, 2021, in case No. 908/2587/20 can be found at the following link - https://reyestr.court.gov.ua/Review/102147578.

This and other legal positions of the Supreme Court can be found in the Database of Legal Positions of the Supreme Court - lpd.court.gov.ua/login.