"Real Estate and Investments. Legal Regulation", the journal

Issue 1 (2), 2000

Some Issues of Public Property Delimitation in the Russian Federation

Shpacheva T.V., judge of the Federal Arbitrary Court of the North-West district. Podvalny I.O., counselor of the first vice-chairman of the Federal Arbitrary Court of the North-West district

According to the article 212 of the Civil Code of Russian Federation (further - CC Russian Federation) private, state, municipal and other patterns of property are recognized in Russian Federation, and according to the article 214 CC Russian Federation state property is divided on federal, i.e. owned by Russian Federation, and one that belongs to the subjects of Russian Federation - republics, krays, areas, cities of federal value, autonomous region, autonomous areas. The division of the public property on state and municipal was established already by Law of RSFSR "On the property in RSFSR ", coming into force from 01.01.91 (is recognized invalid since 01.01.95 by federal Act " On putting into force of CC Russian Federation part one"). However in view of Bases of the civil legislation, acting along with to this law, the property was not differentiated into state and municipal, and practicing lawyers and judges working on arbitration cases became not at once comprehend that the municipal property is not the state property.

The differentiation of property on state and municipal even now causes many problems. It is explained, first of all, by common public and legislative status of the subjects of the state and municipal property they both have special power authorities permitting to pass normative acts, which regulate the procedure of realizing their property rights, and also realization of their property rights in public interests and the lack of appropriate normative base regulating these relations.

Besides, the state property right and the municipal property right are characterized by plurality of the subjects. As subjects of a state property - Russian Federation as a whole and its subjects - republic, kray, area etc. act, but not their authorities of power or control (clause 3 of article 214 CC Russian Federation). The latter act in the property turnover for state formation and according to its competency just realize one or another legal power of the public owner. Urban and rural settlements and other municipal formations as a whole are subjects of the municipal property law. One or another body can realize the legal power on behalf of them in the civil circulation according to the competency (article 125 CC Russian Federation).

Different types of real estate, including land lots, firms and other property complexes, housing fund and uninhabited premises, building and building of industrial and non-productive assigning, various factors of production and subjects of domestic, consumer character are units of state and municipal property. Public property includes securities, owned by public and legislative formations, in particular shares of the privatized firms which have become joint-stock companies, deposits in credit institutions, foreign currency and currency values, and also different historical and cultural monuments.

The units of public property are distributed between Russian Federation, its subjects and municipal formations. The order of reference of the state property to the federal property and to the property of the subjects of Russian Federation should be established by the special law (article 214 CC Russian Federation). Without it the decree of the Supreme Council of Russian Federation " On differentiation of state property in Russian Federation on federal property, state property of republics in Russian Federation, krays, areas, autonomous regions, autonomous areas, cities of Moscow and St.-Petersburg and municipal property " of 27.12.91 3020-I (further referred to as - Decree SC Russian Federation of 27.12.91 3020-I) remains valid which now continues to remain the basic normative act regulating problems of the public property differentiation.

The decree SC Russian Federation of 27.12.91 3020-I contains three supplements:

supplement 1 "Units referring exclusively to the federal property";

supplement 2 "Units referring to the federal property, which can be transferred to state property of republics of Russian Federation, krays, areas, autonomous regions, autonomous areas, cities of Moscow and St.-Petersburg";

supplement 3 "Units referring to the municipal property".

The decree SC Russian Federation of 27.12.91 3020-I stipulates a possibility of the transfer of units of state property of republics of Russian Federation, krays, areas, autonomous regions, autonomous areas, cities of Moscow and St.-Petersburg, in the municipal property in the order established by the Government of Russian Federation. Such order is established by the Regulation on definition of the object composition of the federal, state and municipal property and order of official registration of the property rights approved by the order of the President of Russian Federation of 18.03.92 114-o.p. According to the stated Regulation the Council of the People's Deputies of city approves the list of units transferred to the municipal property, which are registered in the committee on control of the area property. Units which are not eliminated from the list are considered transferred to the municipal property of city from the moment when the Council of the People's Deputies of the area takes the decision about their transferring or on expiration of 2-month's period from the moment of official registration of the list, if the appropriate decision was not made. Thus, to refer a unit to the municipal property it is necessary to keep to a certain order established by the Regulation stated above.

At the same time quite often there were situations, when the due order was broken to some extent, for example, at keeping of the fixed dates.

In the judicial practice of arbitration courts of Russian Federation there were problems: how to react to violation of the given order? Whether it is necessary thus to valuate , how serious those violations are, or to be strictly formal - if the order is broken, a unit is no longer a unit of the municipal property?

Those problems were not solved, despite the Decree of the President of Russian Federation " On warranties of local government in Russian Federation " of 22.12.93 2265, according to which the local authorities have received the right to approve themselves the lists of objects (assets) constituting the municipal property, according to the Supplement 3 to the Decree SC Russian Federation of 27.12.91. 3020-I.

These are some examples from practice of Supreme Arbitration court of Russian Federation.

1. Considering the protest of the vice-president of Supreme Arbitration court of Russian Federation on the judicial acts, which satisfied the claims of the Prosecutor General of Russian Federation about annulment of the order of State Committee of Property of Russian Federation of 06.01.93 15- in the part of including in the share capital of joint-stock company of open type "Primsnabcontract" of a building located: Vladivostok, Soukhanov street, 3, the Presidium of Supreme Arbitration court of Russian Federation states keeping to the established order of transferring of the building to the municipal property, and refusing the protest, in the decree of 26.05.98 7530/97 bases on the fact that this order is not broken and there is an act, which referred the disputable unit of real estate to the municipal property.

2. Similarly is considered the protest of the vice-president of Supreme Arbitration court of Russian Federation on the decisions of appellate and cassation committees which disaffirmed the decision of the Kemerovo area Arbitration court about the refusal in sufficing the claim of Committee on control of the state property of the Kemerovo area to Committee on control of property of Kemerovo city on the application of consequences of invalidity of the void contracts on sale of an uninhabited premise by the defendant (decree of Presidium SAC Russian Federation of 03.06.97 1349/97). Satisfying the protest, abrogating the judicial acts of appellate and cassation committees and leaving in force decisions of court of the first instance, the Presidium of Supreme Arbitration court refers to the fact that the claimant has not returned directed to him by the defendant the list of built and attached premises subject to transferring to the municipal property of Kemerovo city, that is the given list is considered to be accepted to the registration, and the disputable unit refers to a level of the municipal property in violation of the article 9 of the Regulation on definition of object composition of the federal, state and municipal property and order of official registration of the property laws.

3. At the same time it is possible to give an example, when keeping to the above-stated order of the property transfer is not the fact defining the result of a case.

Limited liability partnership " the Nataly Cafe" has appealed to Arbitration court of Omsk area with the claim to Committee on control of property of the city of Omsk about compulsion to conclude a contract of purchase of a rented uninhabited premise. This demand was based on the local law on privatization, and at the decision making the court had first of all to find out whether the redeemed uninhabited premise is the municipal property. By the decision of the court the claims were refused because the disputable uninhabited premise is not the municipal property. The solution of the court was explained with the fact that according to the article 2 of the Decree SC Russian Federation of 27.12.91 3030-I and article 9 of the Regulation on definition of the object composition of the federal, state and municipal property and order of official registration of the property rights the Council of the People's Deputies of city approves the lists of units transferred to the municipal property. These lists are registered in the Committee on control of the area property. The units, not eliminated from them, are considered transferred to the municipal property of city from the moment Council of the People's Deputies of area makes the decision about their transferring or on expiration of 2-month's period from the moment of registration of the list, if the appropriate decision was not made. The parties have not acknowledged documentary such decision. In the registry of units of the municipal property of Committee on control of property of the city of Omsk the disputable uninhabited premise located on the at stated address, is not registered. Abrogating a decision of the court of first instance, the Presidium of Supreme Arbitration court of Russian Federation in the decree of 07.07.98 80/98 has referred to the Decree of the President of Russian Federation of 22.12.93 2265 " On warranties of local self-government in Russian Federation ", thus being based on the fact that the lack of the approved list of units of the municipal property does not testify that the given units are not units of the municipal property. It should be considered as a unit of the municipal property on the basis of the Supplement 3 to the Decree SC Russian Federation of 27.12.91 3020-I.

The article 3 of the Decree provides that Russian Federation, the appropriate subjects of Russian Federation, municipal formations on the asset, transmitted to their property, in the order established by the decree of the Supreme Council of Russian Federation of 27.12.91 3020-I are the subjects of law of the federal, state and municipal property. The document confirming the property right of the subjects of law of the federal, state and municipal property on particular units, is the appropriate registry of the federal, state and municipal property. Up to the moment of registration of a unit in the appropriate registry the enumeration of plants constituted according to the Decree of the President of Russian Federation from 22.12.93 2265 " On warranties of local self-government in Russian Federation " and the Regulation on definition of the object composition of the federal, state and municipal property and the order of official registration of the property rights, approved by the order of the President of Russian Federation of 18.03.92 114-op is such document. In cases on the property law concerning the units which are not registered or which registration in an indicated registry or list is invalid, the Arbitration court, when referring them to an appropriate subject of the property rights, is guided by the supplements 1, 2, 3 to the decree SC Russian Federation of 27.12.91 3020-1.

Thus, the arbitration courts have received the official recommendations of Supreme Arbitration court of Russian Federation at the solution of problems about a level of the property - to apply directly the decree SC Russian Federation of 27.12.91 3020-I.

Criticizing from the very beginning this position of Supreme Arbitration court of Russian Federation, the Ministry of the state property of Russian Federation now has obviously agreed with it, as in the Interpretations of the application of the local law on privatization and normative legal acts regulating the order of the property differentiation in Russian Federation on federal property, property of the subjects of Russian Federation and municipal property introduced by the order of the Ministry of the state property of Russia of 23.04.99 592-, is underlined the reference of units enumerated in the supplement 3 to the Decree SC Russian Federation of 27.12.91 3020-I, to the municipal property (article 8).

Using in practice the decree SC Russian Federation of 27.12.91 3020-I, it is necessary to mark certain difficulties connected with explanation of its particular clauses.

In particular, the article 3 of the supplement 1 to the stated Decree objects of historical, cultural, natural, and art values, departments of culture of the all-Russian value located on the territory of Russian Federation refer to the units of only federal property.

A question arose: the words " of the all-Russian value " refers only to departments of culture or to the whole sentence?

If to agree with the first supposition, we should consider all units of historical, cultural, natural and art values referring to the federal property, as neither in the supplement 2, nor in the supplement 3 monuments of history and culture are separately mentioned.

If to agree to the second idea, only the monuments of history and culture of the all-Russian value refer to units of the only federal property. But how to define them, if by the moment of adoption of the Decree SC Russian Federation of 27.12.91 3020-I by the local law on the protection of monuments (Law of RSFSR " On protection and usage of monuments of history and culture " of 15.12.78 with further modifications and supplements, Regulation on protection of usage of monuments of history and culture passed by the decree of the Council of Ministers USSR of 16.09.82 885, Instruction on creation of zones of protection of immovable monuments of history and culture adopted by the order of the Ministry of culture USSR of 24.01.86 33, Instruction on the order of the registration, safety ensuring, maintenance, usage and restoration of immovable monuments of history and culture passed by the order of the Ministry of culture of USSR of 13.05.86 203) monuments of a history and culture were divided according to their historical, scientific, art or other cultural value into monuments of all-union, republican and local value, and the Decree of the President of Russian Federation 176, approving the list of monuments of history and culture of federal value, is published only 20.02.95?

Questions of what is level of property of the monuments of history and culture which were not included in the above stated Decree and whether they can be the municipal property, have been staying without a precise answer in the practice of arbitration courts for a long time. Position of representatives of state authorities on protections of monuments, including Ministries of culture of Russian Federation, based on the interpretation of the subarticle 3 of the article 1 of the Supplement 1 to the Decree SC Russian Federation of 27.12.91 3020-I, who insisted on the fact that the monuments of local value refer to the federal property, played a certain role.

It is necessary to note, that some decrees of Presidium of Supreme Arbitration court of Russian Federation are now passed, concerning historical and cultural monuments of local value, in connection with particular cases.

The committee on control of the state property of Omsk area has appealed to Arbitration court of Omsk area with the claim about annulment of a decision of Omsk municipal council of 20.05.98 25 " On including buildings - monuments of history and culture of local value into the municipal property of the city of Omsk ". A claimant motivated the claim on declaring the named decision invalid by the fact that it breaks the property law of Russian Federation concerning monuments of history and culture of local value. As the named units are not included in any of the supplements to the decree SC Russian Federation of 27.12.91 2030-I, up to the moment of definition of the appropriate owner of the indicated units they refer to the federal property. Claims are satisfied by the decision of the court.

By the decree of appellate court the decree of the court was abolished and the claims were refused.

The federal arbitration court of the West Siberia district has abolished the decree of the court of appeal, the decree of the first instance has been left in force. Satisfying the protest of the vice-president of Supreme Arbitration court of Russian Federation on the making a cassation and leaving in force the decree of a court of appeal, the Presidium of Supreme Arbitration court of Russian Federation in the decree of 02.11.99 4660/99 has pointed out the following. Conclusions of the court of the first and cassation instances about the fact that the differentiation of monuments of history and culture of local value on levels of property should be effected by transferring to the property of the subjects of Russian Federation, but not immediately in the municipal property, are erratic. The fact that monuments of local value are not mentioned in the supplements 1, 2, 3 to the Decree SC Russian Federation of 27.12.91 3020-I means, that the differentiation of units referred to monuments of local value, on levels of property is realized basing on the criteria which were put in a basis of making of the above-mentioned lists. The status of a monument of local value, which the appropriate units have, is not taken into account at the reference of it to an appropriate level of property. As it is established by the court property units indicated in disputable decree have been in economic support of municipal firms or operating control of municipal establishments and according to the supplement 3 to the Decree SC Russian Federation of 27.12.91 3020-I are subject to transferring to municipal property.

Conclusion that the units of historic and cultural heritage of local value do not refer to the extremely federal property, contains as well in the decree of Presidium of Supreme Arbitration court of Russian Federation of 02.02.99 4803/98, which abolished the decree of Federal arbitration court of the Volga district on the case of Arbitration court of the Samara area.

Thus, it is possible to speak that the judicial practice of arbitration courts is now formed and according to which only monuments of history and culture, included in the appropriate list refer to the federal property, and the remaining monuments can be property of the subject of Russian Federation, and municipal property.

Certain difficulties, including the difficulties arbitration courts face, represents a problem of including of asset to a former department of housing resources of firms left on their balance at privatization. According to the Regulation on commercialization of state firms with their simultaneous conversion to joint-stock companies, approved by Decree of the President of Russian Federation of 01.07.92 721, units, for which the limitation is stipulated or the special conditions of privatization are established, are not included in the share capital of a joint-stock company, but are transferred in support to a joint-stock company, that is the condition of a state ownership on these units does not change.

In this case it is not necessary to identify the term "support" with concept "economic support ", as the asset, including units of real estate, according to the article 294 CC Russian Federation, and also according to the earlier acting Law "On the property in RSFSR " can not be in economic support of a joint-stock company.

The decree of the President of Russian Federation of 10.01.93 8 "On the usage of units of social, cultural, common and domestic assigning of privatized firms " provides that at the privatization of the firms of federal property, housing resources and the housing, operation, maintenance and building subdividings, which provide for it, before conducting the procedure of the property differentiation remain in the federal property and are in support of management at the location of a privatized firm. The reference of this housing fund to the municipal property, on the basis of the provisions of the article 1 of the Supplement 3 to the decree SC Russian Federation of 27.12.91 2030-I, is unlawful, as in the given item the subject is residential and uninhabited housing resources being in control of the executive boards of local Advices of the People's Deputies (of local management), including buildings and structures, transferred by them before in support (on a balance) of other legal entities, and also about built and attached uninhabited premises which have appeared at the expense of 5- and 7-percent assignments on construction of units of social, cultural and domestic assigning.

The similar situation has developed and with a housing fund of state farms reorganized in joint-stock companies on the basis of the Regulation on the reorganization of collective farms, state farms and privatization of state agricultural firms, approved by the order of the Government of Russian Federation of 04.09.92 708.

In such situation is not necessary to say that the housing fund of the privatized firms is the municipal property, as it becomes municipal property only after the procedure of transferring in the municipal property. The transferring of a housing fund in the municipal property is possible only in the voluntary order without any judicial procedure, as according to the article 22 of the Arbitration code of practice of Russian Federation claims on transfer to municipal property are not in the competence of an arbitration court. Understanding it, but at the same time wishing to achieve a positive solution of a question about transfer to municipal property of the above-stated units in a situation, when, as a rule, nobody wishes to acquire them, the interested persons try to formulate the claims in another way, for example, about obligation to conclude the agreement on transfer of a unit to municipal property. However thus it is not taken into account, that the arbitration court can not satisfy this claim, being based on provisions of the article 421 of the Civil Code of Russian Federation on freedom of agreement, as in this case the acting civil legislation of Russian Federation does not provide of any exceptions from a principle of freedom of agreement.

Thus, with reference to the above-stated it is necessary to say that the attempts to solve a problem of transfer of a unit to municipal property with the help of arbitration court are now unsuccessful.

To conclude it is necessary to admit, that the problem of differentiation of public property can be solved in the future in two ways:

- By perfecting of the normative base (it is necessary, in particular, to adopt the federal act, foreseen by the clause 5 of the article 214 CC Russian Federation);

- By perfecting of the judicial practice by means of achievement of its uniformity and exact correspondence to the legislation.