Legality of issuing a new compulsory acquisition order

The Supreme Constitutional Court seems to have definitively untied a difficult legal issue by interpreting Article 23.4 of the Constitution, regarding whether a compulsory acquisition order whose purpose has been achieved, is legal.

The issue raised in the third and final instance was whether the issuance of a compulsory acquisition order, the purpose of which has already been achieved and which resulted in the legalisation ex post, of an unlawfully carried out and already completed intervention in private property is not permitted.

The facts are set out in the judgment of the Supreme Constitutional Court in application No. 2/2024, dated October 30, following an appeal by the attorney-general against a decision of the Administrative Court, where the court posed the above questions for answer.

First-instance decision

Specifically, there was compulsory acquisition of a property but then an annulment decision followed, so the acquisition order was revoked. A new acquisition order was subsequently issued, against the legality of which a relevant appeal was filed with the Administrative Court. In this regard, the court raised the question of whether an acquisition order whose purpose was achieved before its issuance, is legal.

Interpreting article 23.5 of the Constitution, it ruled that the execution of the purpose follows the acquisition and emphasised that it is not acceptable for the administration to intervene in private immovable property, without a legal compulsory acquisition having preceded it. The court said anything else amounts to an abuse of power and annulled the compulsory acquisition order.

The appeal

The Republic of Cyprus filed an appeal but the Court of Appeal, in its decision, rejected it and upheld the first-instance decision, noting that an unlawfully carried out intervention in private property cannot be legitimised retrospectively, by a compulsory acquisition order. Such a thing would constitute a direct violation of the provisions of Article 23.5 of the Constitution.

Supreme Constitutional Court decision

The Supreme Constitutional Court, referring to relevant case law, ruled that the Constitutional Legislator clearly defined the conditions under which the State and/or the administration exercises the power to compulsorily acquire immovable property, which consist of serving a purpose to benefit the public, which is specified in a reasoned decision of the acquiring authority and with the payment in advance of fair and reasonable compensation.

Therefore, it held that the conclusion of the Court of Appeal in an absolute manner constitutes an additional condition preventing the issuance of a compulsory acquisition order, which is not provided for by article 23.4 of the Constitution. Furthermore, it did not agree with the conclusion of the Court of Appeal that the issuance of the compulsory acquisition order constitutes a direct violation of the provisions of article 23.5 of the Constitution.

Interpreting article 23.4 of the Constitution, it concluded that the fact that previous compulsory acquisition orders were annulled, as well as that the project had already been carried out, did not prevent the administration from issuing a new compulsory acquisition order.

It stressed that this did not imply ex post facto legalisation and that what is legal depends in each case on the facts surrounding it. The owner’s right to fair and reasonable compensation, as well as for any illegal intervention, is a given, in order to fully restore his rights within the framework of civil proceedings.

On the claim raised regarding the disregard of a previous annulment decision with the issuance of the new compulsory acquisition order, the Supreme Constitutional Court adopted the case law in the case of Ioannou and others v Republic (2006) 3AAD 161, where it was decided that “it is true that the compulsory acquisition of the property was annulled by the Supreme Court, but this does not make the construction of the buildings prior to the annulment illegal. Immediately after the annulment of the previous compulsory acquisition, the administration proceeded to a new acquisition of the property. We would arrive at absurd results if we essentially decided that a property whose compulsory acquisition was annulled for any reason by the Supreme Court cannot be compulsory acquired again, if buildings were already legally erected on it.

“We do not agree that in order to comply actively, the buildings should be demolished and rebuilt after the new compulsory acquisition. If the owners considered that the existing buildings on the property violated the Law, they could file a lawsuit in the District Court for illegal intervention. The new compulsory acquisition does not constitute an attempt to cover up the illegality, but a legal way out that the administration had after the annulment of the previous compulsory acquisition.”

This is why it set aside the decision of the Court of Appeal that upheld the first-instance decision.

George Coucounis is a lawyer specialising in Immovable Property Law, based in Larnaca. E-mail: coucounis.law@cytanet.com.cy, tel: 24818288