Careful with seizing an automobile as security
On 21 December 2021, the European Court of Human Rights issued a judgment in Stołkowski v Poland (application no. 58795/15) holding that Poland had violated the applicant’s property rights. The case involved the long impoundment of the applicant’s car as security in a criminal case pending against him, which resulted in decimation of the vehicle’s value. Relying on principles of property rights, the court decided when impoundment of a car may be disproportionate, despite the existing public interest and legal basis for application of such a measure.
A car rusting away in a police parking lot
Criminal proceedings for robbery and fraud allegedly committed as part of an organised criminal group were brought against the applicant. In February 2005, the prosecutor’s office secured the applicant’s car, worth at that time about PLN 14,000. The purpose was to secure enforcement of a potential fine, compensation for injury, and court costs against the applicant in the criminal proceedings.
In 2010, hearing the applicant’s case, the Polish court ordered the car to be sold at public auction. The proceeds from the sale were to be held in an escrow account pending final resolution of the case. However, the auction was unsuccessful due to a lack of interested bidders.
In 2011, the court sentenced the applicant to five years in custody and ordered him to pay damages and court costs totalling PLN 7,400. Since the car had not been sold, the applicant could collect it from impoundment.
In 2012, the applicant sued the Polish State Treasury for damages of PLN 15,000 for failing to properly secure the vehicle, which was held by law enforcement authorities for the duration of the criminal proceedings. In the proceedings initiated by the applicant, an appraiser estimated the current value of the car at PLN 1,300. In the appraiser’s opinion, the decrease in value was due to the failure to protect the car from corrosion, replace operating fluids and charge the battery.
The Polish court ultimately denied the applicant’s claim in 2015, finding that the applicant failed to prove that the injury was caused by flagrant breach of the law by law enforcement agencies and the court responsible for seizing the vehicle. Additionally, the court explained that the value of the car would have declined over time whether or not it had been seized. Besides, the car was stored with due care, i.e. placed in a secured parking lot, and was not mechanically damaged.
Private property must be respected
The applicant sought relief from the European Court of Human Rights in Strasbourg. According to the ECtHR, seizure of property for security in criminal proceedings, i.e. a temporary measure interfering with the right to property, lies in the public interest. Nevertheless, the court reiterated that to be compatible with the European Convention on Human Rights, the interference with the right to property must be based not only on the public interest, but also on applicable provisions of law. It must also be proportionate, or in this case, “strike a fair balance” between public and private interests.
The actual damage should not be greater than the inevitable damage
The court found that law enforcement authorities and the court did not act arbitrarily in seizing the applicant’s car for security. The legal basis for their action was Art. 291 of the Criminal Procedure Code. Moreover, their action was in the public interest, as it was intended to ensure the orderly conduct of the proceedings. The court also explained that the fact that the seizure of the property did not ultimately serve its original purpose did not automatically render the measure unjustified in protecting the public interest. While the impoundment was protracted, it was warranted throughout the criminal proceedings.
However, the court had doubts about the diligence with which the law enforcement authorities had stored the applicant’s car. It pointed out that although seizure of property involves some harm, it should be no greater than is unavoidable.
The court stressed that, according to the findings of the court-appointed appraiser in Poland, the value of the car dropped to a tenth of what it was over the duration of the impoundment. The car had been stored for a long time without protection from corrosion, and without changing the operating fluids or charging the battery. The court also observed that performing this type of maintenance is not a common practice for law enforcement agencies, whose exercise of surveillance of seized vehicles is limited to storing vehicles in secured parking lots.
According to the court, although the legal framework does not impose any specific obligations regarding the storage of seized movable property, the persons exercising surveillance are bound by a general obligation to act with due diligence so that the value of the property does not decrease. In its opinion, and above all in accordance with common sense, law enforcement agencies overseeing the seized property should have kept it in appropriate conditions (e.g. indoors). According to the court, such a requirement does not pose an impossible or disproportionate burden. But even if that were the case, the ECtHR observed that the law enforcement agencies or the national court could always make a timely decision to sell the vehicle at public auction. Here, the car was stored for many years in an open parking lot, which could not be considered due diligence. Accordingly, the harm suffered by the applicant was greater than what was inevitable.
The principle of fair balance
The court reiterated that merely suffering an injury through the method in which a vehicle is stored does not justify compensation. Nevertheless, it found that the applicant had been unduly burdened and that the “fair balance” had been upset. Why did the ECtHR reach this conclusion when it had previously found that the national authorities acted in the public interest and on the basis of the law? Answering this question requires a look at the principles of fair balance and the body of case law from the ECtHR.
The principle of fair balance refers to weighing the competing values (individual interest vs public interest) and the need to decide which of them to give higher protection.
In the case under discussion, the ECtHR found that the national courts had failed to strike a fair balance between the competing interests of the public and the applicant, as, having regard to the circumstances of the case, the courts refused to award damages. It is clear from the case law from the Strasbourg court that it is left to the national authorities to weigh up the competing interests (e.g. Chapman v UK, application no. 27238/95). However, the final verification of the fulfilment of these criteria is, in principle, reserved to the ECtHR under its supervisory competence (e.g. Dudgeon v UK, application no. 7525/76).
Practical significance of the judgment
The judgment of the European Court of Human Rights should have a significant impact on the practice of Polish prosecutors’ offices and courts applying a wide range of security measures against property, i.e. to secure payment of future claims adjudicated in criminal proceedings in the form of a fine, damages or court costs, as the case sets certain standards applicable to seizure of vehicles.
The public authorities should take into account the possible decrease in value of vehicles during impoundment, as vehicles are perishable items. In addition, they should consider whether the defendant has any other property that can be attached to ensure the eventual enforcement of the adjudicated claims. But if the authorities decide to seize a vehicle, they should act with due diligence, i.e. take actions that, in accordance with common sense, will not reduce its value, or should allow it to be sold in due time (e.g. if they find that they do not have appropriate storage conditions for the vehicle or that the criminal proceedings will take a long time).
As evidenced by the Stołkowski case, failure to follow these standards may result in the state’s liability for damages.
Artur Pietryka, attorney-at-law, Angelika Bednarz, Business Crime practice, Wardyński & Partners