Remuneration for non-contractual use of real estate vs. abuse of right

Experience / 07.04.2023

The Law Firm’s lawyers successfully concluded a long-standing litigation in a case for payment of remuneration for non-contractual use of real estate owned by the municipality, which was partially seized in connection with trespassing of land boundaries during the construction of one of the largest shopping malls in the Sub Carpathian region.

The situational background of the case was as follows. The Client purchased by bailiff auction land property developed with a building with a commercial function (trading and service mall), which was under construction. As it later turned out, during the period of construction of the building by the previous investor, there was a seizure of part of the municipal land as a result of trespassing on the property. In order to regulate the legal status, the Client filed a lawsuit against the municipality to transfer ownership of the property against payment of appropriate compensation. The case resulted in a court settlement, based on which the municipality undertook to transfer the disputed land to the Client against payment of the agreed remuneration.

The municipality did not execute the court settlement within the agreed term, but initiated a number of lawsuits against the Client, including a lawsuit for revocation of the enforceability of the enforcement title, which was the court settlement, and a lawsuit for payment of remuneration for non-contractual use of the property for the period falling after the date on which the ownership of the property, according to the court settlement, should have already been vested in the Client.

In the litigation, the Law Firm’s lawyers argued that in connection with the acquisition of the property with the construction that had begun through a bailiff’s auction, the Client had taken possession of the land in good faith. In addition, they argued that the municipality’s actions of entering into a court settlement in which the municipality undertook to transfer ownership of the property to the Client and the municipality’s numerous declarations that it would fulfill this obligation, in the context of a delay of more than six years in fulfilling the assumed obligation, resulting in the failure to regulate the legal status within the timeframe stipulated in the settlement agreement, and bringing an action for payment of remuneration for the non-contractual use of the real estate for the period in which the ownership of the plots of land should have already been vested in the Client, constituted an abuse of subjective right, as an action contrary to the principles of social intercourse.

The Court of Appeals in Rzeszow agreed with the argumentation of the Law Firm’s lawyers related to the allegation of abuse of subjective right by the municipality, finding that its actions remained contrary to the socio-economic purpose of the right and the principles of social coexistence, and thus did not deserve legal protection. The municipality’s claim was dismissed in its entirety.

The verdict in the case is of particular importance for the interests of the Client, as the dispute in which the verdict was reached concerned only a certain part of the claims asserted by the municipality under the same title.