The right hand of the public official should know what his left hand does

The authorities of the capital in 2009 filed with the Court of Arbitration of the city of Moscow a claim to demolish the hotel and business center at the crossroads of the Sakharov Avenue and Sadovo-Spasskaya Street for being an unlicensed construction object (the case А40-125218/2009). The city authorities believed that they were acting within the time limit needed for filing the claim, because the claimant – the Government of Moscow – became formally aware of the non-permitted construction only in 2009, when it received from the subordinate Mosstroynadzor structure a letter informing that the developer had no construction permission. The respondents – Business Park and InterStroy development companies – did not argue that the foundation and parking were erected without construction permission but insisted that the limitation period had expired, because in 2006 the relevant municipal body registered the property title to the contested objects with the investor, who rented the land plot where those were located.

The courts’ opinions on the matter diverged. The first instance took the position that the unlicensed construction object should be demolished. The court of appeal revoked that judgment. However, the Federal Court of Arbitration of the Moscow District ruled that the CACM position had been correct. Yuly Tay, managing partner of the Bartolius advocates’ bureau, was indignant: “One body knew of the violated right, and it should thus be considered that the Government of Moscow should have known that too. Otherwise there is an effect of collective irresponsibility of a supreme executive body of a unit of the Federation”.

He also said that the unlicensed construction institution, which is extraordinary in nature, is only applicable in the cases of the direst breaches of property titles to land plots and when the erected objects pose an actual threat to the life and health of people. The speech of the attorney of Business Park that currently owns the buildings was similar to his. He said at the session of the Board of the HCA, which considered the company’s supervision complaint yesterday, that the disputed object was erected at the land plot specially allotted for construction, that it poses no threat to life and health, and that the city construction norms were not breached.

The Business Park attorney said: “Only the construction permission is lacking, which is not a motive to rule the construction unlicensed. The contested object is a part of the construction. The cassation instance court abused its powers, when it ruled to demolish everything. We request that the claim be dismissed”.

He also reminded about the expired periods for filing the claim as the property title to the incomplete construction object was registered in 2006. The attorney of Business Park believes: “The passive conduct by the lessor [the municipal authorities] cannot be a motive for the demolition”. The co-respondent, the attorney of InterStroy development, added that the control body was perfectly aware of the fact that an unpermitted construction had been underway at the object. The attorney of Sadovo-Spasskoe CJSC, the initial lessee of the land plot, also requested that the judgment by the FCA of the Moscow district be revoked.

Their opponent, Anastasia Vazhina, attorney of the claimant – Department of municipal property – spoke briefly. She requested that the cassation decision be left unchanged, and the limitation period, according to her, should be calculated from the moment of notification of the superior public authority by the subordinate body. But the HCA did not agree with her, revoked the judgment by the FCA of the Moscow district and confirmed the judgment by the Ninth court of arbitration.

The experts believe that this is correct. Advocate Artem Kukin, Partner of the Law Firm "YUST", Doctor at Law, told Pravo.Ru: “The HCA is extremely reluctant to take up the limitation period problems. But the example of this case shows that the incorrect application of the limitation periods could bring direst consequences to the civil circulation participants and was so evident that the three judges of the HCA of Russia simply could not leave the case without its attention”.

According to A.Kukin, the logic of the cassation instance is essentially that the risk of absence of a normal communication between various bodies of the Moscow government was imposed on the developer. He says: “The fact that some Moscow officials were not informed of the actions by other Moscow officials was the main argument for non-application of the limitation period. I believe that the Board of the HCA justly and correctly ruled similar argumentation unfounded and protected the weaker side of the legal relations”.

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