How will bona fide purchasers of apartments be protected? The problem of bona fide home buyers: the long-awaited position of the RF Armed Forces - How this happens in practice
Capital Ombudsman - “MK”: “Courts do not use mechanisms to protect bona fide purchasers”
Do not buy apartments on the secondary housing market - this is the appeal made by the Commissioner for Human Rights in Moscow, Alexander Muzykantsky, to the residents of the capital at a hearing in the Public Chamber dedicated to the protection of the rights of bona fide purchasers (see MK dated May 16, 2014). According to the capital's ombudsman, today this is the only way to protect yourself from ending up on the street. After all, the fabulous cost of Moscow square meters has given rise to fraudulent schemes from which ordinary people suffer. In an interview with MK, Muzykantsky explains: all legal mechanisms are in place to protect bona fide purchasers, but the courts and city authorities are in no hurry to interpret the provisions of the law in favor of ordinary citizens.
— Alexander Ilyich, is a market boycott not too drastic a measure?
“There is simply no other way out: stop buying apartments until they put things in order on the secondary market, otherwise citizens are at risk, because the government shifts all risks onto citizens.
— How does this happen in practice?
— The scheme consists of several steps. At the first stage, the apartment is privatized. This is done by the Department of Housing, then registration occurs - a federal official is involved, who certifies the documents and issues a certificate of ownership. Then the owner sells the apartment. Then he sells it again. After several transactions, it ends up with an unsuspecting buyer. And after 3-5 years it turns out that the privatization is fraudulent. Let’s say it was carried out under a power of attorney, which was issued a year after the person’s death. Or according to a marriage certificate, which was issued a year after death, and death is also very interesting - fell from the ninth floor, for example. The claim is filed against the last owner, the court recognizes him as a bona fide purchaser, that is, he did not know and could not know that he was buying an apartment from someone from whom he was not allowed.
- Stop! If he is conscientious, does that mean his rights are protected?
— Here’s the thing: seizure from a bona fide purchaser is possible only if the disposal from the original owner occurred without his will. However, the court can easily decide that, they say, the Moscow government did not express its will to confiscate this apartment from him at the time of privatization. But the question is: how did it not express it if an official of the Moscow government himself signed the papers?
“Nowadays, advertisements for the sale of real estate indicate: “More than three years of ownership.” Many believe that this provides some kind of guarantee: since the deal has not been challenged in three years, then the deadline has passed...
- Does not provide any guarantee. Owned for more than three years, this means you don’t have to pay income tax; the contract specifies the full amount of the transaction without any tricks. But for reclaiming an apartment if the privatization is recognized as fraudulent, this does not play any role. We have examples where people were evicted 18 years after the transaction! They lived in an apartment almost their whole life, gave birth to a child, the child had already finished school - and then the court decided that they were being evicted.
- How can this be, there is a statute of limitations...
— So the chairman of the Moscow City Court, when we discussed this topic, asked me: how did the trial take place 18 years later, taking into account the statute of limitations? I myself would like to find out how the courts accept such statements and calculate this limitation period!
— Are the rights of a bona fide purchaser not protected at all?
— I have a response from Deputy Mayor of Moscow Sergunina to my report “On the problem of protecting the rights of bona fide purchasers.” It says: if citizens are recognized as bona fide purchasers... if the absence of intent is proven... if this is the only housing....
-...then it won’t be confiscated.
- But no: “It is possible to secure the right to use the specified premises on the basis of a rental agreement or social tenancy”! And it is believed that in this way the rights of conscientious citizens are “fully protected.” In my opinion, this is a banal confiscation of property.
— Maybe we can regulate these issues legislatively?
— No legislative changes are required, that’s the point. We have court decisions that say: the Moscow government participated in privatization, which means it expressed its will not to evict anyone. But there are 2-3 such decisions per year. However, they were adopted on the basis of the same legislation. This is a matter of enforcement. The European Court of Human Rights reviewed our legislation, this is the case of Svetlana Gladysheva, who suffered from apartment fraud and reached Strasbourg. A decision was made: the state must bear the risks, since its official makes a decision on the issue of privatization. But our officials are not responsible for anything.
— What can be done to change the situation?
“I proposed to the Moscow government a set of simple measures. Firstly, make claims for damages not to the final bona fide purchaser, but to the fraudster who illegally privatized the housing in his own name. Secondly, carry out internal audits into cases of fraudulent privatization. And thirdly, make changes to the privatization procedure in order to establish control over officials. After all, there are plenty of cases when privatization documents are issued by the department on the same day when the application for privatization is received. What kind of verification is there? This is simply a conspiracy or fraud. But there was no reaction to these proposals. We have a criminal secondary housing market - something needs to be done about it. Today I don’t see any other way to protect the rights of buyers other than to urge them to leave the secondary market.
HELP "MK"
Practice shows: when the courts examine the case in detail, the current legislation is quite sufficient to protect the bona fide purchaser.
Example No. 1 - the decision of the Nagatinsky District Court in the Pestins case (2012). The apartment purchased by this family was privatized six months earlier by the swindler U. using a forged power of attorney on behalf of an elderly Muscovite who died two months after privatization. The court declared this privatization agreement void. However, I drew attention to the fact that this agreement was concluded on the same day when the application for privatization was submitted. That is, the Department of Housing Policy and Housing Fund did not even check anything! Therefore, the court decided that DZhPiZhF “voluntarily transferred the disputed residential premises into the ownership of U.” “Satisfaction of the claim [of the city authorities]... will mean full protection of the interests of the city of Moscow without taking into account the provisions of the Basic Law of the Russian Federation on the duty of the state to protect people,” the text of the decision says. The Pestins left the apartment.
Example No. 2 - the decision of the same court in the case of K.M.V. There, the privatization of the disputed apartment took place in the same way on the same day as the filing of the application for privatization - December 24, 2004. The court took into account that the statute of limitations for void and invalid transactions is 3 years (clause 3 of Article 166 of the Civil Code) from the day when the person bringing the claim learned about the start of execution of the transaction. But if DZhPiZhF registered the apartment privatization agreement on the same day when the application was received, then he could not have been unaware of the execution of the transaction. This means that the statute of limitations has long expired.
Now, if all courts applied the same logic, then there would be no need to call for a boycott of the market.
As Gazeta.Ru learned, the Ministry of Economic Development is preparing amendments that will allow citizens to keep their housing, even if it is revealed that it was illegally privatized. Now such housing can be confiscated in favor of the state even from a bona fide buyer. In addition, it is planned to introduce compensation for owners of apartments lost under this scheme.
The practice of confiscating illegally privatized apartments may stop. The Ministry of Economic Development prepared the corresponding amendments in Art. 302 part 1 of the Civil Code of Russia and Art. 3 of the Housing Code of Russia. They are planned to come into force in December this year.
“The bill is aimed at creating an additional measure to protect citizens from the loss of their only home. To achieve this, it is proposed to enshrine in legislation the rule that previously privatized residential premises cannot be reclaimed from a bona fide purchaser - a citizen for whom it is the only premises suitable for permanent residence. The possibility of extending this rule to other categories of citizens in need of special social protection will also be explored,” the ministry told Gazeta.Ru.
We are talking about apartments that were once illegally privatized. Years later, the forgery may be revealed, and the housing will be confiscated. Since it is impossible to verify the legality of privatization, no one is insured against the loss of an apartment purchased on the secondary market.
“The apartment is being privatized for someone who has no right to it. For example, the owner of the property died, and a year later he suddenly has “legal” heirs who privatize the apartment for themselves and sell it. Registration of illegal privatization, as a rule, occurs with the participation of representatives of local authorities. This apartment may then change through a number of owners. Years later, it is purchased on the secondary market by a law-abiding buyer. He will check it in the Unified State Register, where he will be told that the apartment is registered as a property and there are no restrictions on it. Makes a purchase, takes the contract to Rosreestr, where they check and register the transaction again. And five years later it suddenly turns out that the first owner illegally privatized it.
The property department participated in the falsification of documents, which files a claim and returns the housing to municipal ownership,” Alexander Muzykantsky, the Commissioner for Human Rights in Moscow, describes the scheme. As a result, now throughout Russia, citizens who have not committed any illegal actions may lose their housing. Judicial statistics are not disclosed anywhere, but the number of citizens deprived of apartments under this scheme runs into the thousands, Muzykantsky is sure.
“Within a week after we raised this problem, we received hundreds of requests from all over Russia, and this concerns not only apartments, but also land plots, buildings and non-residential real estate, which are fraudulently privatized with the help of the administration.
The problem exists and lies in the fact that people who have not committed any guilty actions are deprived of their housing, while scammers and those who worked in bad faith get away with it.
Even if someone was imprisoned, no sanctions in terms of return of property or compensation for damage are applied,” he said.
The Ministry of Economic Development, in turn, stated that, based on the decisions of the Presidium of the Supreme Court of the Russian Federation, the judicial authorities are currently focused on the priority of protecting the rights of bona fide purchasers of previously privatized residential premises and studying all the circumstances of the acquisition of housing.
Losses will be compensated
In addition, the Housing Code may be supplemented with a provision on compensation for damage caused to bona fide purchasers as a result of court decisions on claims of state bodies and local governments, at the expense of the budget of the authority that initiated the claim. The Ministry of Economic Development clarified that it is planned to introduce compensation in the amount of the market value of housing at the time of alienation.
“The condition for a one-time payment of compensation may be the clearly established status of good faith of a particular acquirer. The conscientiousness of the acquisition of residential premises must be proven in court. Before changes are made to Russian legislation, the already existing mechanism of one-time compensation from the federal budget must be applied. The criterion for paying compensation will, of course, be checking the integrity of such a citizen. At the same time, the citizen retains the right to return the seized property in court,” the department said.
However, lawyers have concerns that the bona fide purchase will not be easy to prove. Pavel Gerasimov, partner of the Padva and Epstein law office, noted that conscientiousness is an individual and evaluative criterion.
“Judicial practice has also developed criteria for determining good faith - depending on the number of transactions for the alienation of an object; the terms of ownership of the property by each owner; prices of the property specified in the transactions; and so on. At the same time, there are often cases of deliberate creation of the “illusion” of a bona fide acquisition,” the lawyer noted.
It is also not entirely clear the proposal to pay compensation from the budget to the person whose apartment was returned to the budget and claimed.
“In this case, it is easier for such a person to leave the apartment. After all, compensation clearly must be equal to the market value of the apartment, otherwise there is little point in such compensation. Otherwise, such cases can lead to understandable abuses,” Gerasimov noted.
As the lawyer recalled, as a general rule, a person from whom property has been demanded can demand recovery of the purchase price paid from the person who sold him this property. In this way, the rights of the former buyer can be restored.
“Of course, there are often cases when the decision to collect has been made, but it is impossible to obtain the money itself from the former seller. In this case, it would be fair, subject to certain criteria, to support the injured person, but subject to increased responsibility for the perpetrators. If we are talking about the illegality of privatization and the “reclamation” of an apartment from the first purchaser of the apartment, then when establishing his good faith, the question should not be about reclaiming the apartment from such a buyer, but about collecting damages from the official himself, if it was his fault that the illegal privatization was allowed.” , says Gerasimov.
Dmitry Shevchenko, partner at the Zamoskvorechye law office, noted that these amendments are unfair to all other bona fide purchasers.
“It turns out that all other bona fide purchasers remain disadvantaged if the property they acquired left the owner’s possession against his will. Why they want to make exceptions only in relation to illegally privatized property (removed from the owner’s possession during the privatization process against the owner’s will), in this regard, is not very clear to me. How disposal against the will of the owner in the privatization process differs from disposal against the will of the owner in other cases also does not seem very clear to me,” he believes.
12:31 — REGNUM Despite the fact that Russian President Vladimir Putin unequivocally stated that it is unacceptable to confiscate real estate from those who acquired it legally, and the state that made mistakes itself must correct them, his call was not heeded by officials, the deputy noted Secretary of the Public Chamber of the Russian Federation Alexander Muzykantsky. He stated this during the round table “Confiscation of residential premises from bona fide purchasers on claims of state representatives. Practice of the Supreme Court of the Russian Federation and the European Court of Human Rights (2011 - 2016),” the correspondent reports on March 16 IA REGNUM.
“The president said and now everyone, from the presidential administration (AP) to the regional authorities, must try to fulfill the president’s instructions as best as possible. But the practice continued and it turned out that the Supreme Court of the Russian Federation (SC), the prosecutor’s office, parliament, the AP - those on whom the implementation of the president’s instructions depends, are blocking them,” Muzykantsky emphasized.
In modern Russia, citizens have the opportunity to freely purchase real estate, land, and apartments. But along with the opportunity to solve their housing problems, citizens are faced - first of all, with regard to the secondary housing market - with a large number of fraudulent schemes. With the connivance, and sometimes even with the direct participation of government officials, apartments are fraudulently removed from state ownership and sold to unsuspecting bona fide purchasers. In the country as a whole, the number of affected citizens already numbers in the thousands, but this problem is most acute in Moscow, where the number of victims has already reached several hundred people.
The essence of the problem comes down to the fact that a citizen, planning to purchase an apartment, applies to the unified state register of rights to real estate and transactions with it (USRP) to make sure that the property being purchased is registered in the name of the seller and there are no encumbrances on it. Next, having made sure of the legal purity of the property, he buys an apartment, draws up the necessary documents and ultimately receives a certificate of state registration of ownership from Rosreestr. And years later, he suddenly finds out that the purchased apartment, it turns out, was illegally removed from state ownership.
(In cases with other property, it may turn out that the purchased dacha plot ended up in the technical zone of an oil or gas pipeline. Or, as in cases with apartment buildings, when at a certain point the municipal authorities recognize the construction as illegal and require the building to be demolished, there are similar problems for those owners who unexpectedly fell into the zone of expansion of the monument protection zone, approx. IA REGNUM).
At a certain point, having found out that property was illegally confiscated from the state, or other changes similar to those described above have occurred, civil servants go to the courts demanding that the lost property be returned to the state. For obvious reasons, law-abiding citizens who have fulfilled all the regulations in force at the time of the transaction suffer. It is typical that officials do not even try to understand the situation, much less admit the guilt of the authorities. Experts explain such actions by the legal nihilism of government officials and the imperfection of legislation caused by the fact that in modern Russia the institution of property has never been able to form.
The result was massive complaints to the courts of the Russian Federation from affected citizens, dozens of which reached the European Court of Human Rights. In 2015, the RF OP prepared a special report devoted to the unlawful, in the opinion of human rights activists, actions of authorities who, through the courts, seek the return to the state of property acquired by citizens. At the plenary meeting of the OP, held in the same year 2105, President Vladimir Putin agreed with the experts’ conclusions and gave a number of instructions to the authorities to prepare changes to legislation and law enforcement practice.
However, as noted by the Commissioner for Human Rights in Moscow, Alexander Muzykantsky, the Public Chamber was excluded from participation in the preparation of legislative changes. “This situation lasted for years, and no one saw it as a problem, neither the RF Armed Forces, nor the government, nor the regional administrations. Finally, the president said that there was a problem, and this is how it should be solved. And everyone started fussing, but the president said that on the recommendation of the Public Chamber, and the OP was removed from any further participation in this matter,” the social activist clarified.
Then the legislative and executive authorities began to carry out the president’s instructions, and in the way that was understood in one or another department. Thus, the RF Armed Forces, in response, issued a review of law enforcement practice for 2015. Before this, in 2014, under public pressure, the RF Armed Forces had already issued a similar review after the release of the second review in 2015, which on a number of issues turned out to be directly opposite to the 2014 document. Not one of the documents has been canceled, due to which a practice has developed in which in courts for the seizure of property from bona fide purchasers, authorities, depending on their interests, use the review that suits them best in a given situation.
The Supreme Court also does not trust the data of the Unified State Register, apparently confused in its own reviews, in each of which the rights and obligations of the participants in the process are understood in the opposite way. The Supreme Court came up with a “Solomon” decision, which ultimately placed the responsibility of checking the cleanliness of real estate on citizens, those same bona fide purchasers. That is, people should, replacing the authorities, check the purity of transactions in addition to the Unified State Register.
“That is, the buyer is also assigned the responsibility that seems to have been assigned to the registrar. After all, the registrar must check the purity of the transaction. But you see how the Supreme Court acts, it requires from the buyer what the legislator does not even require from the state registrar,” explained Muzykantsky, and added in conclusion: “As a result, the only effective protection for home buyers today is the refusal to purchase real estate on a secondary market. market."
Alexander Muzykantsky was supported by the head of the “Protect your home!” project. Svetlana Gladysheva. She expressed confidence that it is precisely because of the reluctance of the authorities to regulate legislation and its enforcement practice that buying housing on the secondary market is becoming a very unsafe matter. This problem is especially acute in Moscow, where, according to official statistics, 156 claims for repossession of housing were filed between 2013 and 2015. However, these figures, according to her, are too low. In just a few areas of the city over the past few years, over 200 claims have been satisfied.
“At the same time, the real number of claims by government agencies against bona fide purchasers for the recovery and eviction of citizens is almost impossible to establish due to the imperfection of judicial statistics. The problem of housing repossession cannot be called purely Moscow either. Similar statistics come from other regions of the Russian Federation, although in much smaller volumes,” Gladysheva emphasized.
She also noted that the reluctance of the authorities to find acceptable solutions to Russian housing conflicts leads to the fact that Russian citizens are increasingly forced to seek protection in the European Court of Human Rights. Thus, by the beginning of 2017, the ECHR had already made 32 decisions in favor of Russian citizens who suffered from such privatization violations. Of course, the position of the ECHR is not taken into account in any way in the decisions of Russian courts. “In fact, over the entire period, two decisions of the ECHR were implemented - in 2012 and 2015,” the human rights activist concluded.
As previously reported IA REGNUM, who found herself in the situation of a bona fide purchaser, Muscovite Elena Abramova, by decision of the Nagatinsky Court of Moscow, found herself on the street. Despite the presence of two bona fide purchasers, the housing was declared escheat, and according to the claim of the Housing Policy Department, it will be transferred to the city. The injured woman is not entitled to compensation, but she will be obligated to pay off the mortgage loan that she took out to purchase a home.
In October of this year, the Presidium of the RF Armed Forces approved " " (hereinafter referred to as the Review). Contrary to the logic of the title, the document not only examines examples of relevant cases, but also contains direct instructions to lower courts on how they should act in certain situations. Whether the document met the expectations of the experts, and how it relates to the positions of the ECHR and the Constitutional Court of the Russian Federation, we will examine further.
It is worth noting that the problem of government agencies confiscating apartments purchased by citizens on the secondary housing market has existed for many years. One of the main reasons for its occurrence is the illegal privatization or other alienation of apartments on the basis of forged documents and their subsequent resale. When government agencies learn about the fact of fraud, they go to court with claims to reclaim premises from someone else’s illegal possession (). In this case, the defendant, as a rule, is the second or third owner of the apartment and does not even suspect that it was privatized illegally a long time ago (the so-called “bona fide purchaser”).
The situation is complicated by the fact that courts of general jurisdiction have not developed a uniform practice in such cases. The subject of controversy is the law, which allows the seizure of property from a bona fide purchaser only if it was alienated against the will of the owner. This is where the main contradiction arises. On the one hand, privatization occurs through the provision of fake documents by the attacker - that is, by committing fraudulent actions. However, on the other hand, the government agency signs the privatization agreement, that is, it expresses its will to alienate the property. In the future, such transactions and the transfer of ownership of them are also successfully registered in Rosreestr. In this regard, lawyers have long noted the urgent need for clarifications from the RF Armed Forces on this issue.
Good faith of the acquirer
OUR HELP
A bona fide purchaser is understood as a person who acquired property for compensation from another person who did not have the right to alienate it, about which the acquirer did not know and should not have known.
First of all, the Presidium of the RF Supreme Court listed the circumstances that the courts must establish in order to understand whether the acquirer is in good faith:
- the fact of disposal of property from the possession of the owner or from the possession of the person to whom it was transferred by the owner into possession, by or against their will;
- compensation (free of charge) for the acquisition of property;
- whether the acquirer knew or did not know and should not have known that the property was acquired from a person who did not have the right to alienate it.
The Presidium of the RF Supreme Court also raised the issue of what the plaintiff (state or municipal body) and the defendant (purchaser of the apartment) must prove when considering relevant disputes. Thus, the plaintiff must prove his ownership of the disputed property and the fact that the illegal owner has this property. At the same time, the presence of real estate in the register of state or municipal property, as well as the fact that the property is on the plaintiff’s balance sheet, do not in themselves constitute evidence of ownership of this property or legal possession of it. The defendant must prove that the residential premises were acquired by him under a paid transaction, and at the same time he did not know and should not have known that the person from whom he acquired the property did not have the right to alienate it.
OPINION
Elena Nakhimova, lawyer of AK No. 16 "Nakhimova and Partners" of the Moscow City Bar Association:
“From the mentioned provisions of the Review, it follows that the plaintiff is spared the need to prove in court the disposal of his residential premises against his will. This circumstance, as it were, is presumed. Meanwhile, this is perhaps the most painful issue, since all the other circumstances listed by the RF Armed Forces , which the plaintiff must prove, are objective in nature, and “disposal against the will” is a subjective circumstance, based on a judicial assessment.
As is known, in Russian legislation the meaning of the term “disposal against will” is not disclosed. In practice, with rare exceptions, the concept of “disposal against the will of the owner” and “disposal due to dishonest (unprofessional, negligent, etc.) actions of the owner’s officials” are equated. Judicial practice is in dire need of official clarification on the delimitation of these concepts (specifically in relation to the category of disputes under consideration).”
As for the legally significant circumstances that the defendant must prove, it should be recognized that the Supreme Court of the Russian Federation, unfortunately, takes the view that in this category of disputes there is no presumption of the defendant’s good faith - the burden is placed on him to prove his good faith. In my opinion, the question of the presumption of good faith of the defendant is extremely important, since in disputes with state bodies and local governments, citizens are certainly the weaker party and require additional state protection and additional guarantees of their rights and interests protected by law.
In its Review, the Presidium of the RF Armed Forces emphasizes that when ascertaining the good faith of the purchaser, the courts need to take into account not only the presence of an entry in the Unified State Register of Ownership of the seller. It is worth finding out whether the citizen exercised reasonable diligence when concluding the transaction, what measures he took to clarify the rights of the person alienating the apartment, and other facts determined by the specific circumstances of the case. For example, it is established whether there were any encumbrances at the time of alienation, including a seizure, and whether the acquirer inspected the residential premises before purchasing it
The buyer's good faith can be evidenced by his familiarization with all title documents for real estate, as well as clarification of the grounds for the emergence of ownership rights by the seller of real estate. Moreover, if the acquirer knew that at the time of the completion of the compensated transaction there were claims of third parties in relation to the disputed property, and if such claims were subsequently recognized as legitimate, then the court will not be able to recognize him as bona fide.
OPINION
Zinnur Zinnyatullin, lawyer at the Moscow Bar Association "Knyazev and Partners":
“The review does not really contain the position that the courts lack in protecting bona fide purchasers. The system that forces the buyer, when buying an apartment, to thoroughly study all the documents - not only the direct seller, but also the documents of the seller of his seller, and so on - continues to operate. It’s surprising why, "Being a citizen of a legal state, when purchasing real estate you cannot rely solely on Rosreestr data. It would seem logical to get an extract from the Unified State Register, inspect the apartment and be considered a bona fide purchaser on this basis. Alas, the RF Armed Forces takes a different position."
If the acquirer is ultimately recognized as being in good faith, then, as mentioned above, the property can be reclaimed from him only if it was transferred from the owner against his will. What courts should take into account when clarifying this circumstance was also explained by the Presidium of the RF Armed Forces in its Review.
The will of the owner to alienate the apartment
The Presidium of the RF Armed Forces considers two main situations.
1
Property is removed from the owner as a result of the actions of a person who did not have the right to alienate it. At the same time, the authorized body did not enter into an agreement on the alienation of the apartment and did not directly take any actions. For example, property rights were registered as a result of fictitious registration documents being submitted directly to Rosreestr or a subsequently canceled court decision. In this case, the apartment is recognized as having been disposed of against the will of the owner, and can be reclaimed from someone else’s illegal possession, including from a bona fide purchaser.
True, in this situation the question arises of how mistakes or unlawful actions of officials not of the owner himself, but of other government bodies (Rosreestr, courts, civil registry office), as well as notary offices, should affect the fate of a bona fide purchaser. Firstly, some of them must ensure the purity of the transaction and the correct execution of the necessary documents - but they do not always fulfill this duty. Secondly, the basis for illegal privatization or other alienation of apartments is often fake powers of attorney, wills, certificates of inheritance, marriage certificates, court decisions, which cannot be made without the participation of relevant officials.
“The issue of disposal of residential premises from state bodies and local self-government bodies due to the fault of officials of other state bodies and local self-government bodies was not reflected in the Review. It seems that clarifications should also be given on such situations, and in favor of citizens, since, only such a conclusion suggests itself from an analysis of the provisions of the Convention for the Protection of Human Rights and Fundamental Freedoms and the practice of the ECtHR on human rights,” comments Elena Nakhimova.
FROM THE RESOLUTION
“With so many regulatory authorities ensuring clear title, neither the applicant nor any other third party purchaser of the apartment should have assessed the risk of termination of title due to defects that should have been remedied through procedures specifically introduced for that purpose. The authorities' omission could not justify subsequent sanctions against the bona fide purchaser of the property.<….>The European Court recalls that mistakes or miscalculations of state bodies must serve the benefit of the interested parties [in the context of the case considered by the ECtHR – apartment buyers. – Red.], especially in the absence of other conflicting interests. In other words, the risk of any error made by a public authority must be borne by the state, and errors should not be corrected at the expense of the person concerned.”
It is worth noting that in the Review under consideration, the Presidium of the RF Supreme Court also once again emphasized that courts of general jurisdiction must take into account the legal positions formulated in the ECHR Rulings made in relation to Russia (based on the Resolution of the Plenum of the RF Supreme Court dated June 27, 2013 No. 21 " ").
2
Property is disposed of from the owner as a result of his own actions. For example, a state or municipal body signed an agreement on the transfer of ownership of an apartment to a citizen, that is, it carried out alienation actions. However, the transaction was made on the basis of forged documents and is invalid by law. However, as noted by the Presidium of the RF Armed Forces, in such a situation the invalidity of a transaction for the alienation of residential premises does not in itself indicate the disposal of real estate against the will of the owner.
Thus, property cannot be reclaimed from a bona fide purchaser if it is established that the authorized body could verify the conformity of the submitted documents with reality, but did not exercise due diligence. In this case, the will of the home owner is expressed by him when issuing the relevant title documents, as well as when registering the contract and ownership of the disputed apartment.
The practice of the RF Supreme Court itself and a number of lower courts confirms this; in particular, they note that document verification is the responsibility of the government agency concluding the privatization agreement. In addition, based on the positions of the courts, we can conclude that the agreement on the alienation of property signed and registered in Rosreestr already indicates the will of the owner. The presence of vices of will (deception, delusion) does not matter in this situation.
The Constitutional Court of the Russian Federation spoke in a similar spirit: according to its position, the legislator must provide for such methods and mechanisms for the implementation of property rights that would provide protection not only to owners, but also to bona fide purchasers as participants in civil transactions. Otherwise, for a wide range of bona fide purchasers, there will be a risk of unlawful loss of property that can be demanded from them through restitution [each party is obliged to return to the other everything received in the transaction. – Ed.] ().
However, as noted in the special report of the Commissioner for Human Rights in Moscow published in 2013 Alexander Muzykantsky(now Deputy Secretary of the RF OP) about the problem of protecting the rights of bona fide purchasers, despite the positions of the ECHR, the RF Supreme Court and the RF Constitutional Court, city courts are still making decisions in similar cases not in favor of bona fide purchasers. At the same time, the percentage of decisions made in the Moscow region in favor of citizens who are bona fide purchasers is insignificant. Particular attention to this problem and its severity in Moscow is not accidental due to the volume of the real estate market, which is more expensive than in the regions. At the same time, according to Alexander Muzykantsky, in other regions of the Russian Federation there is practically no such problem.
OPINION
Alexander Muzykantsky, Deputy Secretary of the Public Chamber of the Russian Federation:
“In many regions there is no judicial practice on the problem of bona fide purchasers of housing, and where there is, it is resolved in the overwhelming majority of cases in favor of the residents. Local executive authorities are denied vindication by the courts [reclamation of property from someone else’s illegal possession – Ed.]. Moreover, they refuse very often with reference to the same decision of the ECHR and the decision of the Supreme Court of the Russian Federation and with reference to simple logic: if you yourself signed the document on privatization, why are you now saying that it is illegal?”
Conditions for applying vindication and invalidating a transaction
The Presidium of the RF Armed Forces also distinguished between the grounds for application and. The first rules regulate the reclaiming of property from someone else’s illegal possession (vindication claim), require clarification of the good faith of the acquirer, the will of the owner to alienate the property, the remuneration of the transaction and do not provide for the recognition of its invalidity. The second norms require recognition of the transaction as invalid, not entailing legal consequences, as well as the return of the transferred property, regardless of the good faith or bad faith of the parties.
If the defendant (acquirer) did not directly enter into an agreement with the plaintiff (state or municipal body) on the transfer of housing, but acquired this property from another person as part of subsequent transactions, then the rules apply. In this case, it does not matter which method of protecting his right the plaintiff chose: a claim for reclaiming residential premises from someone else’s illegal possession () or for invalidating transactions for the alienation of an apartment (), or filing such claims at the same time. If it is established that the acquirer is in good faith, then the claim must be denied.
However, the very first transaction, which was concluded directly between a state or municipal body and the person to whom the apartment was transferred, may be declared invalid on the grounds, for example, for the purpose of subsequent recovery of losses from the fraudster. Previously, a similar position on this issue was also expressed by the Constitutional Court of the Russian Federation (). This position seems extremely important, since in practice, when satisfying claims for reclaiming housing from bona fide purchasers, courts sometimes simultaneously apply and, which, as follows from the positions of the RF Armed Forces and the RF Constitutional Court, have different subject matter of regulation.
Calculation of statute of limitations
The Presidium of the Supreme Court of the Russian Federation noted that the general statute of limitations applies to claims for the recovery of real estate from someone else's illegal possession, which is three years from the moment the owner learned or should have learned about the existence of a corresponding entry in the Unified State Register (;).
However, the mere entry in the Unified State Register of Rights to real estate or its encumbrance does not mean that from the date of its entry in the Unified State Register the person knew or should have known about the violation of the right. Therefore, the moment when the limitation period begins to run for the stated claims can be determined based on the circumstances of a particular case. For example, from the day when the owner learned about the initiation of a criminal case, the commission of investigative actions ().
This position of the RF Armed Forces is of significant importance, since sometimes courts, when considering vindication claims against bona fide purchasers, incorrectly determine not only the moment when the limitation period begins to run, but also the period itself. In particular, they are guided by the provisions on the statute of limitations to protect the rights of the owner from violations not related to deprivation of possession - the so-called negatory claims (). The fact is that the statute of limitations does not apply to negative claims at all ().
As a result, apartments are sometimes reclaimed from bona fide purchasers 10 or more years after the government agency learned of fraudulent actions during its alienation (decision of the Tagansky District Court of Moscow dated September 17, 2013 in case No. 2-1626/2013, decision of Tagansky District Court of Moscow dated December 24, 2013 in case No. 2-2678/2013, decision of the Golovinsky District Court of Moscow dated November 29, 2013 in case No. 2-3931/2013). And . It cannot be said that statutes of limitations do not apply to vindication claims when they do apply.
Thus, on the one hand, the review contains useful information that should play a positive role in solving the problem of repossession of housing from bona fide purchasers. However, some pressing issues of protecting their rights remain unresolved. Plus, certain provisions of the Review itself are also perceived ambiguously.
We should also not forget that the problem of bona fide purchasers lies not only in the sphere of law enforcement, but is also quite obviously connected with the corruption component in government agencies and notary offices. This conclusion, in particular, was reached by the participants of the RF OP held in the summer on this topic.
Not the least role in solving this problem is played by the political will of senior officials, in particular, the city of Moscow, who are not prevented from adjusting the policy of a constituent entity of the Russian Federation in this regard, taking into account the unequivocal positions of the RF Armed Forces, the Constitutional Court of the Russian Federation, the ECHR on the inadmissibility of confiscation of housing from citizens -for the imperfect work of government bodies.
