28 November 2018 Wednesday

Hikmet Kuleci (no. 2018/5145, 28 November 2018)

The Facts

The applicant having served at the Turkish Armed Forces for 31 years retired in 1993. During the period he served for the Turkish Armed Forces, he was covered by the state retirement fund.

He was paid a retirement bonus calculated on the basis of his service period of 30 years pursuant to the provision “in determination of the retirement bonus to be granted, periods over 30-year actual service periods… shall not be taken into account” specified in the Law no. 5434 on the State Retirement Fund.

Upon the annulment of the said provision in 2015 by the Constitutional Court, the applicant relying on the Court’s annulment decision filed a request with the Social Security Institution (SSI) for also receiving a retirement bonus in return for his service period in excess of 30 years.

Having received no reply to his request, the applicant brought an action for annulment against the SSI before the administrative court which then awarded him a retirement bonus for his service period over 30 years plus legal interest to accrue from the application date.

The applicant appealed the administrative court’s decision. However, his appellate request was dismissed. In 2017, the SSI paid, in return for his service period over 30 years, a retirement bonus of 50 Turkish liras (TRY) plus legal interest of TRY 6.55 that were calculated on the basis of the coefficients applicable at the date of his retirement.

The Applicant’s Allegations

The applicant maintained that his right to property had been violated due to the depreciation of the retirement bonus paid for his service period over 30 years.

The Court’s Assessment

The applicant’s unpaid retirement bonus undoubtedly constitutes an asset within the meaning of Article 35 of the Constitution. Payment of this amount after being depreciated as a result of inflation constitutes an interference with his right to property.

With respect to his service period in excess of 30 years, the applicant filed an action for annulment for receiving a retirement bonus by relying on the Court’s annulment decision of 2015. However, pending his proceedings, a new regulation was introduced by the provisional article added to Law no. 5434. In line with this legal arrangement, the applicant was paid the said retirement bonus by the administration in August 2017.

In the present case, the reason for non-payment, to the applicant, of a retirement bonus for his service period over 30 years is the legal provision included in the then applicable Law no. 5434 and annulled by the Court in 2015. However, annulment of this provision does not obviously have a retroactive effect. As the annulment decision rendered by the Court has no retroactive effect, the question whether to introduce a retroactive arrangement in this respect falls within the legislator’s discretionary power. As a requirement of the principles of legal security and certainty, the administration does not naturally make any payment retroactively unless such an arrangement is made.

A provision of law annulled by the Constitutional Court will cease to have effect as from the date when the annulment decision enters into force; however, acts and actions performed according to this provision shall remain in force. Therefore, making of no retroactive payment by the administration on the basis of the annulment decision, which had no retroactive effect, does not lead to violation of the right to property. However, if the judicial authorities order retroactive payment of such receivable, the relevant amount is to be paid within a reasonable time by the date of entitlement specified in the court decision and without being subject to any depreciation.

The legislator introduced an arrangement in 2017 in respect of the applicant and the retirees in the same position as the applicant and accordingly provided for the payment of retirement bonus for the service periods over 30 years. It is accordingly revealed that pursuant to this legal arrangement, the applicant was entitled to this payment not retroactively but as of 27 January 2017, the date when the law took effect.

In the present case, the amount receivable by the applicant within the scope of his right to property was paid to him, without any depreciation, by the date of his entitlement. The interference was therefore found proportionate as no excessive and extraordinary burden was placed on the applicant.

For the reasons explained above, the Court found inadmissible the alleged violation of the right to property safeguarded by Article 35 of the Constitution for being manifestly ill-founded.