5.  The applicant was born on 30 August 1949 and lives in Nicosia.
6.  The applicant was employed at the Department of Lands and Surveys on 1 December 1971. On 1 January 1996 he was promoted to the position of assistant officer and on 2 February 1998 he was authorised by the director of the department to sign payment orders as authorising officer. On 13 May 2002 a complaint was made by the director following an irregularity in a compulsory acquisition case. It emerged from the investigation that a series of cheques had been issued as alleged compensation to owners of land that had been compulsorily acquired, but that the cheques had never reached the payees named on them.
7.  A number of criminal proceedings were brought against the applicant and an accomplice. It also appears that a third person was charged but those proceedings were terminated following the filing of a nolle prosequi by the Attorney‑General. The proceedings against the applicant involved a total of 223 criminal charges.
8.  On 18 January 2005 the applicant received concurrent sentences ranging from two to five years’ imprisonment from the Nicosia Assize Court (no. 18115/02) on a plea of guilty, following a plea bargain to twenty-
four charges concerning a number of offences. These included, inter alia, obtaining the amount of 225,643.67 Cyprus pounds (CYP) (approximately 390,000 euros) by false pretences, issuing false documents, forging cheques, abuse of office, and concealment. Part of the agreement reached between the parties was that the applicant would repay the sum of CYP 150,000 (approximately 255,000 euros), and a confiscation order for that sum was issued in respect of his property. In imposing the sentences the Assize Court also took into consideration another eight cases pending against the applicant before it as well as the District Court of Nicosia.
9.  The applicant lodged an appeal with the Supreme Court against his sentence (criminal appeal no. 22/05).
10.  Following the applicant’s conviction, and having received the Attorney-General’s advisory opinion that the offences committed involved dishonesty or moral turpitude, the PSC instituted disciplinary proceedings against the applicant. Similar proceedings were also instituted against his accomplice, on whom the PSC imposed compulsory retirement pursuant to section 79(1)(i) of the Public Service Law of 1990 (Law 1/1990; hereinafter “the Public Service Law”; see paragraph 43 below).
11.  By a letter dated 13 April 2005 the PSC informed the applicant of the Attorney-General’s opinion and invited him to appear before it on 17 May 2005 and to make representations before proceeding with the imposition of a disciplinary penalty.
12.  The PSC convened on 17 May 2005. The applicant’s lawyer requested a month to prepare his pleadings, as he had only recently been appointed and in view of the special nature of the case. The PSC granted the request.
13.  On 13 June 2005, the applicant, who was represented by a lawyer, was heard by the PSC. He put forward a number of mitigating factors, which included his dire financial situation following suspension from his duties, the fact that he had paid off most of the sum agreed upon with the authorities, the conviction and sentence he had received from the Assize Court, his significant years of service, and the less severe punishment imposed on his accomplice. He also submitted a socio-economic report by the Department of Social Welfare Services.
14.  On 13 June 2005 the PSC decided to dismiss the applicant. In its decision the PSC observed that this case had been one of the most serious cases it had been faced with. The conception and planning of the crimes committed showed a well-set-up fraud which had dealt a blow to the prestige and credibility of the procedures of the Department of Lands and Surveys and also to the image of the Public Service in general. The PSC noted that the offences of which the applicant had been convicted included some of the most serious offences against property, as well as abuse of office and concealment. The gravity of the offences was evident from the severity of the sentences applicable under the law, the substantial sum the applicant had secured through his unlawful actions, and the fact that eight more cases pending against him concerning similar offences had been taken into account by the Nicosia Assize Court when imposing sentence. The PSC also pointed out that the applicant had faced 223 charges in total, which was unprecedented for Cyprus and which disclosed the seriousness and the magnitude of the case.
15.  In reaching its decision the PSC observed that it had taken into account the circumstances and conditions under which the applicant had committed the offences. He had been authorised to sign payment orders and had been entrusted by the Republic with the important post of promoting cases concerning compulsory acquisition and serving citizens involved in these cases. The applicant, however, did not live up to his responsibilities, exploited his position, and developed his criminal activities with unprecedented effrontery and recklessness. He had been the mastermind, instigator and main executor of the criminal activities.
16.  The PSC also noted that it had taken into consideration what had been said by the applicant’s counsel in mitigation, in particular, the applicant’s personal and family circumstances, as well as the fact that he had undertaken to compensate for the damage and/or part of the damage suffered by the Republic as a consequence of his criminal acts. Further, the PSC pointed out that he had been the main protagonist and this had been stressed by the Assize Court when distinguishing the sentence passed on him from that passed on his co-accused.
17.  Pursuant to section 79(7) of the Public Service Law (see paragraph 43 below), the disciplinary penalty of dismissal resulted in the forfeiture of the entire applicant’s public service retirement benefits (hereinafter “retirement benefits”). This entailed the loss of a retirement lump sum and a monthly pension.
18.  Lastly, the PSC decided that the part of the applicant’s salary that had been withheld during the period of his suspension from service would not be returned to him.
19.  Up to the date of his dismissal the applicant had worked for thirty-three years in the public service.
20.  On 23 March 2006 the applicant withdrew his appeal.
21.  Pursuant to section 79(7) of the Public Service Law (see paragraph 43 below), his wife received a widow’s pension. This amounted to 15,600 euros (EUR) per year.
22.  On 26 August 2005 the applicant brought a recourse before the Supreme Court (revisional jurisdiction) under Article 146 of the Constitution, seeking the annulment of the PSC’s decision to dismiss him from the Public Service and of the consequent forfeiture of his pension rights (recourse no. 994/2005).
23.  The applicant claimed that the forfeiture of his retirement benefits had been in breach of Article 23 of the Constitution and Article 1 of Protocol No. 1 to the Convention. In this respect the applicant argued that his pension rights constituted a “possession”, and that their automatic forfeiture consequent to his dismissal was disproportionate.
24.  On 2 April 2007 the Supreme Court, in an ex tempore decision, held that the recourse was admissible. The court observed that the case concerned the discretion of the PSC in deciding on the dismissal, taking into account all relevant parameters and, in particular, the consequences dismissal would have for the applicant. Therefore, the decision on the penalty and the consequences were very closely linked, bringing to the forefront the principle of proportionality as the main aspect of the PSC’s discretion. It was obvious from the PSC’s decision that in exercising its discretion when choosing the penalty to be imposed it had taken into account the automatic, as it considered, by law, loss of retirement benefits. As a result the court concluded that the extreme severity of the case justified, despite its grave repercussions on the applicant’s retirement rights, the penalty of dismissal. If in the end the court were to accept the applicant’s claims, the setting aside of the penalty of dismissal could not be excluded. The Supreme Court therefore concluded that it could continue to examine the merits of the recourse.
25.  On 7 May 2007 the Supreme Court dismissed the recourse, but did not award costs against the applicant in view of the nature of the legal issues raised.
26.  The Supreme Court, after having ruled that the retirement benefits of a public servant in Cyprus constituted a possession under Article 1 of Protocol No. 1, went on to examine whether or not there had been a violation of the applicant’s rights under this provision. Drawing guidance from the Court’s case-law, and in particular the judgments in the case of Azinas v. Cyprus (no. 56679/00, 20 June 2002, and [GC], no. 56679/00, ECHR 2004‑III), and the decision in the case of Banfield v. the United Kingdom ((dec.), no. 6223/04, ECHR 2005‑XI), the Supreme Court first pointed to those factors which justified the deprivation of the right to property in this case. One such main factor in the court’s view was the gravity of the offences committed. It considered in this respect that the characterisation of the case by the PSC as one of the most serious in its history did not appear to be an exaggeration. The impression given by the offences was such that not only did they entail a well-organised fraud but they also, most importantly, as the PSC asserted, dealt a blow to the prestige and trustworthiness of the administration. The court considered that sentencing the applicant to five years’ imprisonment, as well as dismissing him, did not necessarily exhaust the limits of the discretion of the State to put things right. Besides, as in Azinas, the non-deprivation of pension benefits in the case of a pension plan to which the employee did not make contributions would amount to rewarding the applicant.
27.  At the same time, the serious consequences of the applicant’s punishment - a sentence of five years’ imprisonment and dismissal - had also to be considered, particularly the financial difficulties arising from the deprivation of the said rights as an additional “punishment” for the applicant and his family. The court observed that this was an important factor to be taken into account, according to the circumstances of each case. If the deprivation had not been automatic but discretionary within the framework of enacted procedures, as in England, it would have been possible to examine whether there should be a deprivation and to what extent. The court noted in this respect that it would indeed be good for the State to consider seriously the prospect of an amendment to the law so as to make the system more flexible and fairer in each case. Moreover, there was also the fact that the applicant had to a great extent returned the money he had embezzled, a fact which, although the PSC had said that it had taken it into account, did not appear to have affected its decision, since the punishment imposed on the applicant was, of the ten forms provided for, the extreme one of dismissal instead of choosing the second most serious form of punishment, that of compulsory retirement, which would not have entailed the loss of retirement rights.
28.  In the end, however, the Supreme Court considered that the fact that the case in question arose and was heard on the basis of a different statutory regime from that in Azinas as regards the consequences of dismissal entailing the loss of pension rights, tilted the scales, albeit slightly, in favour of the Republic. The proviso in section 79(7) that the applicant’s pension from the day of his dismissal would be paid to his wife and dependent children as if he had died on that date reduced for the family the hardship resulting from the dismissal. Despite this, the court observed that it was likely that there would be cases with even more dire consequences for the dismissed employee, such as when there was no wife or dependent children, or their relationship was such that the dismissed employee could not reasonably expect to benefit through them. Nothing, however, had been said to include the present case among those cases, except for the theoretical possibility that his wife could die before the applicant. The court stated that, if matters were otherwise, it was likely that it would have ruled differently.
29.  Finally, the Supreme Court stressed that the competent bodies should seriously study the possibility of amending the statutory framework on the basis of the law in force in England, so that deprivation of retirement rights was not automatic but could be looked at with the help of enacted procedures and with the exercise of discretion in order that the PSC might determine, by means of a reasoned decision, the extent to which it was just to forfeit, if at all, in any particular case, according to the individual’s special circumstances and needs. The Supreme Court considered that both the rule of law and the modern conception of individual justice demanded this.
30.  On 5 June 2007 the applicant lodged an appeal with the Supreme Court (appellate revisional jurisdiction; appeal no. 78/2007). He first challenged the first-instance finding concerning section 79(7) of the Public Service Law. He submitted that this section was contrary to Article 23 of the Cyprus Constitution and Article 1 of Protocol No. 1 to the Convention, as the forfeiture of his retirement benefits had been automatic, without the exercise of any discretionary power. In this respect he argued that the first-instance court had applied the proportionality principle incorrectly during the examination of the penalty imposed by the PSC, and therefore had been wrong when it decided that the measure was proportionate and in line with the Convention. Secondly, the applicant claimed that the finding of the first-instance court that the consequences of this decision were reduced because he was married and thus his wife and dependent children would receive a pension, was discriminatory on the ground of marital status and thus in violation of Article 28 of the Constitution.
31.  On 12 June 2007 the respondent Government also appealed (appeal no. 81/2007) challenging the first-instance findings (a) that in the present case the retirement benefits could be considered a “possession”; (b) that in the disciplinary dismissal of a public servant there was no enacted framework providing for the exercise of discretion as to whether the retirement benefits would be granted; and (c) that the payment of the pension to the applicant’s wife was the only essential factor which tilted the scales in favour of the Republic.
32.  On 18 May 2010 the Supreme Court dismissed both appeals without awarding costs, in view of the importance of the matter raised. It agreed with the first-instance court’s finding that the right to a pension and its conditions constituted a possession of the employee. This right was created by the appointment of the employee. The fact that a pension was given to the wife and dependent children suggested that pension benefits were considered as “property” which could be transferred. In this respect the court referred to its judgment in the case of Pavlou v. the Republic (revisional appeal no. 161/2006, (2009) 3 CLR 1402; see paragraph 46 below) and the Court’s judgment in the case of Apostolakis v. Greece (no. 39574/07, 22 October 2009).
33.  The court went on to find, however, that the deprivation of the applicant’s retirement benefits had been justified. In this respect, the court noted that the PSC had chosen the penalty of dismissal under section 79(7) of the Public Service Law, after exercising its discretion and after considering the consequences and the fact that such a penalty was in the public interest. The first-instance court had examined whether the imposition of the penalty of dismissal, which brought about the automatic forfeiture of retirement benefits, was disproportionate. It had examined whether the PSC, when exercising its discretion, had applied the principle of proportionality in deciding on the penalty of dismissal, which itself resulted in the automatic deprivation of retirement rights. In this respect it held that the PSC had exercised its discretion when deciding to impose the penalty of dismissal. The PSC had had a variety of available penalties at its disposal, such as compulsory retirement, which did not bring about the forfeiture of the pension. It decided, however, in view of the offences committed by the applicant, that such deprivation was justified.
34.  The Supreme Court pointed out that the European Court of Human Rights had acknowledged that the administration had wide discretion in deciding on such matters.
35.  It went on to agree with the first-instance court that the deprivation of the applicant’s retirement benefits had been justified in view of the seriousness of the offences, which had dealt a blow to the trustworthiness and credibility of the administration. The relevant domestic law provision was aimed at discouraging public servants from committing serious offences and at protecting the smooth running of the administration. Section 79(7) of the Public Service Law was not contrary to Article 1 of Protocol No. 1, since the deprivation of retirement benefits was not a punishment on its own, but a consequence of the imposition of the penalty of dismissal.
36.  The court went on to distinguish the applicant’s case from that of Apostolakis, in which the forfeiture had been automatic following a criminal conviction and had entailed deprivation of both pension and social security rights and therefore of all means of subsistence. In the present case, although the applicant had been deprived of his retirement benefits as a public servant, he had been entitled to receive benefits from the Social Insurance Fund, which were calculated on the basis of contributions made by the employer and the employee. Referring to the Court’s judgment in the case of Wieczorek v. Poland (no. 18176/05, 8 December 2009), it found that the applicant had not been deprived of all means of subsistence.
37.  As to the question of discrimination due to marital status, raised by the applicant, the Supreme Court held that the first-instance court’s comments on the matter did not support the applicant’s claim of discrimination. The comments in question had been made on a hypothetical basis and did not apply to the present case.
38.  Lastly, the Supreme Court dealt with the remaining grounds of appeal put forward by the Government. It observed that the first-instance decision was to the effect that in the event of dismissal the law did not provide for a procedure concerning the exercise of discretion for forfeiting retirement rights, but it did not say that it was not possible to exercise discretion on the matter, since it recognised that there was a choice between dismissal entailing forfeiture of rights and compulsory retirement, which did not. Finally, it pointed out that the first-instance court had set out in its decision all the facts which it had taken into account in deciding on the proportionality of the forfeiture, and had rightly concluded that the payment of the pension to the wife meant that the deprivation was not disproportionate. The court did not award costs in view of the important issues raised.
39.  The applicant has been receiving a social security pension from the Social Insurance Fund since 31 August 2012, when he reached the age of sixty-three. The pension therefore received by his wife pursuant to section 79(7) of the Public Service Law was then reduced by the complementary sum received by him from the Social Insurance Fund. According to a letter dated 28 November 2012 sent to her by State’s Treasury, her pension was reduced by EUR 854,94 per month.