Background
Four Italian companies owned land in Sesto San Giovanni that was designated for a social-housing plan in 1963. The authorities took possession in 1972 and issued an expropriation order in 1975. A 1972 planning amendment had reduced the land’s building potential.
Domestic proceedings over compensation began in 1986 and ended in 2015. The Court of Cassation held that the reduced building potential had to be considered in valuing the land, and limited inflation adjustment to the period after the companies challenged the compensation offer. The companies complained that the prolonged official and judicial delays made the award inadequate.
The Court’s Holding
The Court declared the complaint by Immobiliare Bergamella Prima inadmissible ratione personae because it was not the addressee of the expropriation order and was not a party to the domestic proceedings. It declared the complaints by the other three companies admissible.
Unanimously, the Court found a violation of Article 1 of Protocol No. 1. It did not consider the planning-related reduction in building potential arbitrary or manifestly unreasonable. But the compensation failed to account for the companies’ inability to use the land between the 1963 expropriation restraint and the 1972 occupation, and for inflation between the 1975 expropriation order and the 1986 proceedings. Those delays were attributable to the authorities and imposed a disproportionate burden. The Court awarded the three companies jointly EUR 3,593,213 in pecuniary damage, EUR 10,000 in non-pecuniary damage, and EUR 50,000 in costs.
Key Takeaways
- Lawful expropriation compensation must remain proportionate despite lengthy administrative and judicial delays.
- Where no effective remedy exists against official inaction, the State may bear responsibility for inflation loss before an owner initiates proceedings.
- The Court distinguished a valid general planning restraint from uncompensated loss caused by delay in the expropriation process.
Why It Matters
The judgment reinforces that expropriation awards cannot be assessed only by their nominal domestic amount. States must account for delay-related losses, including lost use during prolonged restraints and inflation that erodes compensation before an owner can effectively obtain redress.