What is the procedure for protection of the owner of farmland within urban boundaries, where the owner is deprived of possession by a third party claiming to be the owner of the same property? What are the remedies available to the third party, where an ownership claim has been filed against him by a restituted heir of a former owner of farmland within urban boundaries? Both parties have the right to remedy against unjustified challenge of their ownership rights due to the absolute nature of rights in rem. The existing remedies follow the general procedure concerning claims, i.e. through the filing of a revindication claim or, where the defendant is not the possessor of the property, through a positive declaratory claim or a negative declaratory claim provided that a legal interest exists therein.
The restitution of farmland within urban boundaries is not excluded from the scope of the Farmland Ownership and Use Act (“the Farmland Act”) as it is envisaged as a derogation provided that the imperative provisions of the law are complied with. Pursuant to Art. 10(7) of the Farmland Act, subject to restitution are the rights of the owners of farmland properties in their patrimony before the establishment of cooperative farms or state-owned farms, regardless of whether those properties had been included in those cooperative or state-owned farms or other farming organizations established on their basis and consolidated into the boundaries of urban territories (settlements) in accordance with a detailed urban development plan or a surrounding polygon, unless third parties had built those properties up in full compliance with the statutory requirements or had been granted building permits and the legitimate works had started as of 1 March 1991.
Pursuant to Article 10ter, paragraph 1 of the Farmland Act, ownership rights are not subject to restitution, where farmland properties in their patrimony before the establishment of cooperative farms or state-owned farms, regardless of whether those properties had been included in those cooperative or state-owned farms or other farming organizations established on their basis and located within or without the boundaries of urban territories (settlements), were built-up or the measures implemented thereon prevent the restitution of the ownership rights. In such cases, the owners or their heirs are entitled to indemnification, at their choice, with equivalent land from the state-owned or municipal land stock and/or registered indemnification bills.
The case law of the Supreme Court of Cassation makes the following distinction in the enforcement of these two legal provisions: Article 10(7) of the Farmland Act refers to the construction of a stand-alone building by a natural person and, in this case, the relevant fact is whether the building has been started or legitimately built by a natural person as of 30 March 1991, whereas Article 10ter, paragraph 1 of the Farmland Act does not refer to individual buildings because it refers to measures or a building-up exercise of a comprehensive nature, covering farmland both within and without the urban boundaries. Unlike Article 10(7) of the Farmland Act, the provision of Article 10ter, paragraph 1 of the said Act does not contain a statutory requirement for legitimacy of works.
The restitution procedure is finalized with a decision of the municipal farming office. This decision, together with the sketch map of the property, is equivalent in its legal effect to a declaratory title deed. If the decision of the municipal farming office is appealed pursuant to the provisions of Article 14(3) of the Farmland Act, the district court at the location of the property or the administrative court acting as a cassation instance may rule to recognize the ownership right of the plaintiff to the specific property. In the latter case, regardless of the common practice of courts to “reinstate” farmland owners, it is necessary to have a subsequent decision of the municipal farming office because the remit of the court is to establish whether the plaintiff is entitled to restitution but not to prescribe the way in which the ownership will be restituted. It is within the exclusive powers of the municipal farming office that will issue a decision, taking into consideration the current condition and status of the property.
A decision of the municipal farming office to reinstate an owner in a farmland property within urban boundaries in its former real location may be subject to appeal in terms of its lawfulness in the course of proceedings where the ownership right is challenged. This is possible because although the decision of the municipal farming office with a sketch map of the property attached thereof is equivalent, in its legal effect, to a declaratory title deed, it is a decision made in the course of an administrative procedure without the participation of the third party. The parties to the restitution procedure are the applicant and the municipal farming office (previously called “the municipal land commission”). The European Court of Human Rights, unlike Bulgarian courts, answers the question whether the participation of the administrative authority excludes a subsequent opportunity for the state to challenge the rights recognized and reinstated in this procedure in the negative. In its judgment of 12 January 2006 in the Case of Kehaya and others v. Bulgaria, the ECHR held that the recognition of the right of the State to file a claim against restituted farmland owners has “the effect of providing a “second chance” for the State to obtain re-examination of a dispute already determined by way of final judgments in contentious proceedings to which another emanation of the State, a specialized administrative authority in charge of restitution – the land commission, – had been a party and had been afforded all procedural means to defend the State interest”.
The right to claim ownership rights against persons to whom a farmland property has been restituted is afforded to any third party other than the State. In these proceedings, it is possible to challenge the substantive lawfulness of the decision of the municipal farming office, as well as the judgments of the district and the administrative courts. The mandatory case law of the Supreme Court of Cassation specifies the admissible objections to an ownership claim based on farmland restitution. For instance, Judgment No. 194 of 21 April 2012 of the Supreme Court of Cassation in Civil Case No. 834 of 2011 reads that “the defendant may not challenge the legitimation of the claimant with the objection that the person to whom the claimant is an heir was not the owner of the contested property as of the time of the collectivization of that property, unless the claimant himself claims ownership rights to the property at the same time”. The defendant may contest the claim only with his own rights which exclude the rights of the claimant.
The main line of defence for the claimant in the contentious ownership proceedings will be as follows: to prove the legitimate restitution procedure of reinstating the person who was deprived of his property in through collectivization or his heirs in the property; to prove that the restituted property is identical to that owned prior to the restitution (in case the owner is reinstated in the real boundaries of the property); to prove the existence of the preconditions for restitution under Article 10(7) of the Farmland Act and the legitimate membership of the municipal farming office in the decision-making process. The case law reveals that courts tend to proclaim a decision of the municipal farming office null and void, where it has not been signed by all its members. Judgment No. 759 of 1 November 2010 of the First Civil Division of the Supreme Court of Cassation in Civil Case No. 1859 of 2009, having analyzed the provisions of Article 60, paragraphs 4 (repealed) and 5 (repealed) of the Farmland Act, comes to the conclusion that the membership of the land commission was established by law but there was no regulation on the membership required for decision-making purposes, whereby the validity of the decision depended on the number of members who had taken part in the decision-making process.
The main line of defence for the defendant in the contentious ownership proceedings will be as follows: to challenge the legitimate lawfulness of the decision of the municipal farming office or the judgment of the district or administrative court, as the case may be; to prove the existence of impediments to the restitution of the ownership rights in the former real boundaries under Article 10(7) or Article 10ter, paragraph 1 of the Farmland Act, i.e. the existence of a legitimate building constructed by a natural person prior to 31 March 1991 or the implementation of a measure by the State; to prove that the decision was made by a non-legitimate membership of the municipal farming office.
The main lines of defence of the two parties outlined above refer to hypothetical contentious proceedings. When it comes to practice, the concrete dispute would be further complicated by other assertions of the parties as to the factual aspects of the case, e.g. the restituted property has not been registered into the land cadaster, it has been included in the capital of a privatized company with equity holdings of the State or the municipality, etc. This would call for further and more diverse lines of defence for the two parties to the proceedings.