If such land plot withdrawal for state use takes place does any legislative mechanism exist today to assure fair and sufficient compensation?

I.M.: We do have such a mechanism today. On February 2nd last year the Head of the State signed Edict No.58 determining the loss compensation procedure for individuals in case of land plot withdrawal for state use. The procedure is regulated in details; individuals have right to get the living quarters of typical consumer characteristics  depending on the number of residing persons, as well as financial compensation of backhouses, green planting, trees, bushes. The entire procedure has been explained in the above Edict.

If a person is dissatisfied with the compensation offered by the executive committee, what is the procedure of complaining from the law viewpoint? Which body to apply in case of complaint?

I.M.: It is obvious that you should appeal to a court against the compensation amount, this is the most civilized and legal form. You might also lodge an appeal to the prosecutor’s office but what can prosecution do in such a case? Its purpose is to supervise the precise and uniform application of the law. In other words, if the procedure has been duly observed then the grounds for taking measures might be missing. Our court is not only bound by the law, it also relies on its inner conviction: while making its assessment it can consider the issue on the form and on the amount of compensation. If the individual is dissatisfied with the form and the amount of what is being offered to him instead of the lost property, he should better apply to the court. 

Does the so called “speculation” in land plots exist in our country today, in other words, do we have illegal entrepreneurial activities in the field of land turnover? Have you registered such facts? If yes, then what are the prerequisites for occurrence of such situations, what is their origin?

I.M.: There is such a problem which is connected with the acquisition of land plots aimed not at direct housing improvement or housing construction, but at follow-up resale. It is caused by the whole range of factors. We have quite a liberal legislation in relation to the land plots grant. It’s quite simple to acquire a land plot; actually the problem lies in the queuing system. In the regions where the demand is quite low, and the supply exceeds the number of the volunteers, one could acquire the land plot in a day. The problem of land plots resale is more typical for Minsk region, but other regions of the republic also face it. As an example we may give a case when an individual has acquired almost 30 land plots. Materially the law suggests that he could acquire them for his own consumption, for housing improvement, for construction of a house. But he did acquire all these land plots exclusively for speculation purposes, for the follow-up resale. During two years he has sold about 15 land plots. Naturally, we have detected the essential elements of illegal entrepreneurial activities in this individual’s actions and initiated a criminal case which is now being in the process of pre-trial investigation.  

You are saying that the individual has managed to get thirty land plots. But as far as the forum users are writing, most of the village councils have the only response: “There are no free land plots available”. Then the question is arising: are there any facts of hiding land plots or any corruption elements while granting or non-granting of them?

I.M.: This issue is also a topical one, such facts do take place: some land plots are being hold back, and are not granted by the executive committees. Just from my recent practice I had a case when an individual was denied to get a land plot allegedly on the ground of unavailability, but later on an official who addressed the executive committee got the land plot.   Proper measures were taken and the land plot was recaptured to the state and then was submitted for its further redistribution.

In general, if you believe that the land plots are being hold back from you, apply to the executive committee in writing. Official appeal for the purpose of granting a land plot and official denial are the grounds of cassation. If you have just called the executive committee and asked whether there were any land plots available and got the “No” answer, but later on you see in the Internet that there are some of them available, so it is not serious. Submit to the executive committee a proper application request on granting a land plot and wait for the response in writing; in case of disagreement with the response you can appeal against it. 

What responsibilities do officials of executive committees actually bear for violations in the sphere of granting land plots?

I.M.: There is rather strict and fundamental land law compliance supervision today, and the entire facts of law violation by the officials do not remain without proper response. During 2009 and the beginning of 2010 about 350 officials of executive committees and land use planning organizations were brought to disciplinary responsibility on the initiative of the Prosecutor’s Office. This is quite an essential amount for the republic. Apart from that such facts are even appraised as criminal ones if there are legal grounds for that. I won’t reveal a secret if I say that a number of the village executive committee chairmen in Minsk district are hold criminally liable, convicted and serve their sentence for illegal granting of land plots, forgery and some other delicts. We keep on working in that direction. We try to keep close watch on the situation and not to overlook any single fact.

What are the ways for legal entities to struggle against the illegal decisions or nonfeasance of local authorities in relation to land issues? What is the appeal procedure against the decision or nonfeasance of local authorities in relation to land issues?

E.M. (Eduard Maximovich): This kind of disputes like challenge against the non-normative legal act and appeal against the actions (nonfeasance) of state authorities is stipulated by the Economic procedure Code of the Republic of Belarus. For the economic court of Minsk region “the land issue” is one of the most important and this kind of disputes is very widespread in our court comparing to other economic courts of the republic. If the case is about the executive committee decision on denial of land plot granting or on land plot withdrawal, the economic entity is authorized to appeal to court with challenge against the non-normative legal act. Subject of the appeal may also be nonfeasance of the local state authority which fails to make the decision on granting a land plot within the terms of its reference. In such a case the economic entity is authorized to appeal to the economic court with the request to recognize the state body action as illegal and to compel this body to execute actions which are within the terms of its reference.

Could you give any actual example of nonfeasance of the local authority which, contrary to the law, failed to make a decision on land plot granting and such nonfeasance was challenged against in the Economic Court?

E.M.: Yes, there is such a case, and it is not the single one. A private unitary enterprise has appealed to the district executive committee with request to allot it a land plot for exercising entrepreneurial activities. Such a land plot was put up for auction. But the auction failed to take place due to the reason that the unitary enterprise was the only participant who claimed to make a land lease agreement.  The executive committee has decided to call for a new tender. According to the legal requirements, in case the tender failed to take place because of the only participant wishing to make a lease agreement, the executive committee is obliged to make the agreement with this participant within 10 day period. But the executive committee stood idle und failed to make a decision on granting a land plot on leasehold basis. The case came to trial. The claim was filed to the economic court; the unitary enterprise requested to compel the executive committee to sign a lease agreement. The economic court considered the case, weighed the pros and the cons and met the claim of the unitary enterprise. It compelled the executive committee to execute the actions which fall under its competence, i.e. to make the decision on this issue.

I would like to draw your attention to the point that the economic court in itself cannot substitute any other state authority and make the decision on land plot granting or denial. Such a decision shall be made by the authority authorized to make such decisions. 

What facts of violation of land laws by the legal persons would you point out as widespread today?

I.M.: Violation of land laws by the legal entities and individuals in effect do not differ much from each other.  Among the most widespread facts are unauthorized land plot occupations, unauthorized use of the land plot and land pollution.
We have had a case of unauthorized occupation of the land plot in Minsk recently. “Torgoviy dom “Zhdanovichi” OJSC (ОАО «Торговый дом «Ждановичи») has occupied several land plots on an unauthorized basis for the purpose of marketplace territorial expansion and location of the parking lot on this land. After intervention of law enforcement agencies the local authorities assumed the land vacation measures. Unfortunately, not everything has been put in order by now, certain violations have not been corrected, but in general, the breach has been cured. The above company has also admitted some land pollution cases.

There were a lot of unauthorized land use facts revealed in the course of the hunt and fishing inspection last year, when the land plots granted to the natural persons for the house maintenance purpose were used by organizations, entrepreneurs and companies for the purpose of arrangement of the so called ecotourism. A lot of such facts have been revealed in Vitebsk region. Among considerable amount of such violations is nonpayment of land cost, which is also a major violation and may result in land plot withdrawal.

Have there any facts of unlawful granting of land plots been revealed by the local authorities?

Igor Matskevich

I.M.: Unfortunately, such facts did take place, and we cannot make sure that we don’t have them today. A number of factors infect the situation. The episodes of land plot granting without auction in cases when the auction should have been conducted, are also not excluded. Basically there is a land law regulation which is effective from May 2, 2006, in accordance with which only the necessitous persons may be granted the land plots without auction. There also have been cases when the materials of preliminary approval of objects’ location were missing and it is still happening today.

It should be noted that the person interested in land plot acquisition shall be also interested in the compliance with the whole procedure. Naturally, there is the following position: I have written an application and I don’t care anymore, the executive committee is making decision and is taking on the responsibility. It is actually so to some extent, but not in all situations. The experience shows that taking such unlawful decisions sometimes results from the corrupt practices.

According to this year’s new version of the article 223 of the Civil Code, the  construction shall be deemed as unauthorized and is subject to demolition, if it has been carried out on the land plot granted by the state authorities on unlawful basis, for instance, if the auction should have been conducted as to the law. In other words, if a state authority has violated the land plot granting procedure, the developer who had no least idea about that is considered to be a person carrying out unauthorized construction. Then the question is arising: what to do? According to the above article, the structure should be demolished and there is no alternative. But there is also an interesting saving clause: by the decision of the court the ownership title to the unauthorized construction may be recognized for the person possessing the land on the lifetime heritage or ownership basis. As we know only individuals may possess the land on this basis. What shall legal person do in such a case? Having suffered from state body violations the legal entity is not empowered to take legal action for the declaration of land title, is it?

E.M.: I would like to draw your attention to the fact that the right of court exists at all times. The   point is what result of consideration of the dispute in court will be. I leave open the possibility that the economic entity may go to the economic court with the claim of declaration of land title to the construction built. This remedy tool is stipulated by the law. We may not talk on practical consideration of such cases in the context of the latest amendments to the Civil Code. The economic court of Minsk region has not experienced such cases yet. It cannot be ruled out that such claims to the economic court are possible without forejudging the results of the dispute consideration. Recognizing the land ownership title, the further decision on allotting the land plot is very up-and-coming. 

I.M.: We have not experienced such cases for the three months, but basically, if the court shall recognize the land ownership title and the legal entity combines it with the claim to force the executive committee to allot certain land plots required for the maintenance of that building, then it can be the issue of trial and further decision making.  

That is to say that regardless of the above article, even the legal entity which does not possess the land plot on ownership basis may apply to court, isn’t it?

I.M.: There is a general rule of the Civil Code which says that the rights shall be defended in court. This law form does not conflict with the other regulations of the Civil Code. The legal entity is empowered to claim the declaration of ownership title to its real estate.

E.M.: We may talk about the general rule but there are some nuances of this or that situation which may occur in practice and they should be taken into account while considering the case. 

It is not infrequent that some legal entities file an application on declaring the decisions of local authorities on withdrawal of land plots invalid. Were there any cases when a legal entity was filing an application on declaring the decision on allotting the land plot to it invalid?

E.M.: We have had a case recently with rather an unusual situation.  The executive committee has made a decision in accordance with which a limited liability company was allotted a land plot on leasehold basis. The company itself has appealed against this decision. The issue was on the land plot located not far from Minsk, which was being put up for auction for the purpose of construction of a servicing station. In the course of considering the case it turned out that it was impossible to locate the servicing station on the major part of that plot. The economic entity could not use all the area. Moreover, wile holding an auction the executive committee committed a number of different violations. Apparently, having cleared up what the company was granted, it rejected to appear at the auction at the last moment, although it proceeded with the application. It turned out to be the most substantial violation of the auction procedure and the ground for declaring the decision on granting of the land plot invalid by the court.  Default in appearance of the participant at the auction is recognized by the court as refusal to participate, and in the existing circumstances (absence of other participants) such an auction shall be recognized as not having taken place.

The decision of the executive committee has been recognized as invalid, and the court relied not upon the economic feasibility of the applicant, but upon the number of violations committed by the executive committee in the course of holding the auction for granting a land plot.

Eduard Maximovich

If in the course of the court proceeding you see that there are some facts that may witness of the violations coming under certain articles of the Criminal Code from the part of the local authorities, what can the reaction of the Economic Court be in view of the fact that it is out of its sphere to deal with such issues?   In what way do you interact with the other authorities?

E.M.: Making the decision on declaring the non-normative legal act invalid or satisfying the claim on recognizing the nonfeasance of the state authority illegal, the economic court shall oblige the competent authority to execute actions within its reference or to correct the committed violations. The court decision on these issues shall contain such a regulation.

If while considering the issue the economic court detects a violation of the law, the assessment of which is within the terms of reference of other authorities, the economic court may response by way of notifying the state authority, prosecutor’s office or by way of sending the interlocutory judgment which also requires correcting the committed law violations. 

The users address the prosecutor’s office a lot of questions. On the whole, the questions may be reduced to the following: “We got a land plot for the purpose of individual house construction. We don’t carry out construction at the moment. Is there any time period settled by the law by which the building should be constructed or get registered or the construction should have been started? The issue is whether the land plot is subject to withdrawal due to the failure to carry out construction. What does the failure of carrying out construction mean?

I.M.: There are plenty of such situations today because a great number of people have exercised their right and got the land plots. The law provides two obligations of the individual: firstly, to apply for the state registration of the land title within two months and secondly, to start land plot development within a year. In the event the individual has started arranging the internal networks, it shall be deemed as the beginning of development.

The previously effective rule providing that during three years from the issue of the title certificate it is required to put the construction in operation is now being suspended. There is no any time-frame settled today for the individual during which the construction shall be completed.   

Does this mean that one may dig up a ditch and the letter of the law has been observed?

I.M.: Due to the letter of the law it is required to develop the land plot and its use for a specified purpose. Two ditches differ. Firstly, the individual shall obtain the documents permitting the construction, i.e. the owner certificate.   He shall also make a type design adjustment of the facility under construction to the site. In the event all further actions including the foundation are matched with these documents, this will be considered as use for a specific purpose and development of the land plot. 

Is it legal to withdraw the land plot without notifying the person it was granted to?

I.M.: If it is actually possible, certainly, this is a law violation, because land plot withdrawal is allowed only after notifying the person with the consent of the land user, or without his consent but after proper notification.

Let’s touch upon the townhouse construction. There is a very widespread situation when a townhouse is being built using own resources on rather a small land plot located in Minsk in someone’s private ownership. A townhouse is a blocked residential building which afterwards is being sold out in parts or in separate flats. Are there any problem issues in such an activity from the law viewpoint?

I.M.: It’s rather a complicated issue. Such actions may be estimated as illegal entrepreneurial activity in the event it is proved that the land plot granted to the individual for the maintenance of the house was being used by him for the commercial purposes aimed at deriving revenue. If the individual entrepreneur carries out such an activity then there are some questions from the law angle: an individual entrepreneur may get a land plot for the commercial purposes only on leasehold basis and may not use such a land plot in his possession like a natural person.

E.M.: While assessing such an activity it is required to come from the definition of entrepreneurial activity: an activity aimed at systematic profit-making from the property use or sale of goods. Such an activity irrespective of being sold for the purpose of deriving revenue shall be deemed as entrepreneurial.