§ 4 Lands under the Agricultural Land Ownership and Use Act (ALOUA) – Specific Features and Practical Issues

1. What are “§ 4 lands”?

Generally speaking, these are agricultural lands that were formerly allocated by the State to individuals for use, most commonly as small plots for personal farming, gardening or as villa plots, without the users thereby becoming the owners of the land. Following the restoration of private property rights, the law had to regulate the relationship between two groups of persons – on the one hand, the former owners of the land and their heirs, and on the other, the individuals to whom the State had allocated the same land for use. It is precisely for such cases that the Agricultural Land Ownership and Use Act (ALOUA) establishes the special regime under § 4 and the following provisions. With the adoption of ALOUA, the rights of use previously granted were, as a general rule, terminated. However, the Act allows some users, subject to certain conditions, to acquire ownership of the land. Thus, the rights and interests of the former owner and those of the user may compete in respect of the same land. For this reason, in the case of § 4 lands, it is not sufficient simply to establish who uses or cultivates the property. It is necessary to trace the legal basis on which the land was originally allocated for use, the rights of the former owner, and the procedure carried out under ALOUA.

2. Specific features of ownership of § 4 lands

ALOUA provides for different possibilities depending on the particular circumstances of the property and the user. One of the most important is that under § 4a. Where a building was constructed by the user on land allocated for use by 1 March 1991, and the other statutory requirements are met, the user may acquire ownership of the land. An important issue is what qualifies as a “building”, since not every structure is sufficient for this purpose. On this point, the Supreme Court of Cassation has held that the structure must meet the specific legal definition of a building under the Regulations for the Implementation of ALOUA and must be permanently attached to the land. It is not necessary to establish separately that the building complied with the construction rules and standards applicable at the time when it was built. In the case of undeveloped land, § 4b allows the user to acquire ownership only in certain cases expressly provided for by law and subject to additional conditions. The Act also limits the area that may be acquired – up to 600 sq. m under § 4a and up to 1,000 sq. m under § 4b, while the special rules of § 4z apply to any area exceeding those limits. Where the user is not entitled to acquire the land, ownership is restored to the former owner or his or her heirs. Where restitution in kind is impossible, the Act provides for compensation. Where the land is acquired by the user, the determination of the price and its payment within the statutory period are of particular importance. Once the Plan of Newly Formed Properties has entered into force and the necessary conditions have been fulfilled, the mayor issues an order for the acquisition or restoration of ownership of the particular newly formed property. In the case of § 4 lands, long-term use of the property, the existence of a fence or a building, an issued cadastral sketch, or the registration of a particular person in the cadastral records do not, by themselves, prove ownership. To establish who the owner is, it is necessary to trace the legal basis on which the property was acquired or restored and to determine whether the procedure prescribed by law has been completed.

3. The Auxiliary Plan and the Plan of Newly Formed Properties

The Auxiliary Plan and the Plan of Newly Formed Properties (PNFP) are of particular importance for § 4 lands. They perform different functions and should not be confused. The Auxiliary Plan is primarily intended to establish the original situation. It brings together and compares information concerning the properties that existed before the establishment of the former collective and state agricultural farms (TKZS and DZS) and the properties that were subsequently allocated for use. Where the former boundaries cannot be established from the current cadastral records, old cadastral, land-consolidation and land-management plans, aerial photographs, photoplans and other graphic materials may be used. Where necessary, a geodetic survey and the inquiry procedure provided for in the implementing regulations may also be used. The Auxiliary Plan contains the boundaries and numbers of both the former and the existing properties, as well as information on the owners, title documents and existing development. The PNFP is prepared on the basis of this information. It determines the specific newly formed properties – which parts are to be acquired by eligible users and which are to be restored to the former owners. Existing buildings, structures and permanent plantations are taken into account when determining the properties, and access to a street or road must be provided. The PNFP is subject to a procedure for acceptance, public notification and consideration of objections submitted by interested parties, after which it is approved by an order of the Regional Governor. Once the plan has entered into force, the procedure for the individual properties continues with valuation and payment, where required, and with the issuance of the mayor’s order for the acquisition or restoration of ownership. The PNFP may also be amended after it has entered into force, but only on the grounds provided for by law and in accordance with the prescribed procedure. The mere fact that the actual use of the land differs from the boundaries shown in the plan is not, in itself, sufficient grounds for amending the plan.

4. The most common problems with § 4 lands

The practical problems associated with these properties arise mainly from the long period during which different rights, plans and physical boundaries have overlapped. It is often difficult to identify the former property; its boundaries may overlap with land subsequently allocated for use; or the area actually occupied by the user may be larger than the area that the law allows the user to acquire. In other cases, an approved PNFP exists, but the procedure for the particular property has not been completed – for example, there may be no final valuation, no evidence of payment or no mayor’s order. Disputes may also arise as to whether an existing structure satisfies the requirements of § 4a. There are also cases in which the former owner or the user has died and the procedure is continued by his or her heirs. Case law highlights another important practical point: administrative steps taken to identify the property and the issuance of the necessary sketches and certificates do not, by themselves, resolve a dispute over ownership. Their purpose is to enable the restitution procedure to be completed. Where there is a dispute concerning the substantive right of ownership, that dispute may need to be resolved separately by the court. Therefore, when purchasing, selling or inheriting a § 4 property, it is not sufficient to examine only the title deed and the current cadastral sketch. The entire history of the property should be traced – the former owner, the legal basis on which the land was allocated for use, the decision of the Municipal Agriculture Office, the Auxiliary Plan, the PNFP, the valuation and payment, the order concerning the particular newly formed property, any subsequent transactions and any court proceedings. For § 4 lands in particular, the answer to the question “Who is the owner?” is often found not in a single document, but in the entire sequence of documents and procedures relating to the property.