Recovery of sums for the use of a plot of land in municipal ownership without a concluded lease agreement is governed by civil, not tax, legislation – SC CommCC

The legal relationship arising from the actual use of a municipally owned land plot by the owner of real property situated thereon without an executed lease agreement is condictional in nature (i.e. based on the principles of unjust enrichment under Civil Law) and is governed by Chapter 83 of the Civil Code of Ukraine, rather than by tax legislation. The limitation period prescribed by Article 102 of the Tax Code of Ukraine for the determination by a controlling authority of the amount of a taxpayer’s monetary obligations does not apply to claims for the recovery of sums unjustly retained in the form of rent under Article 1212 of the Civil Code of Ukraine, since such legal relations arise not between a taxpayer and a controlling authority but between the owner of the land and the actual user.

This conclusion was reached by the Commercial Cassation Court within the Supreme Court.

The city council sought recovery from a company of sums unjustly retained for the use of land: the company had acquired the immovable property on a plot of municipal ownership in July 2018, yet concluded a lease agreement only in December 2021. In its cassation appeal the company contended that the sums had been calculated as a tax payment (land tax), and therefore could be assessed only within the 1,095-day period provided for by the Tax Code of Ukraine; beyond that period it was free from any monetary obligation.

The Commercial Cassation Court of the Supreme Court observed that an actual user who, without a sufficient legal basis, has retained sums that he ought to have paid for the use of the plot is obliged to return them to the landowner under part 1 of Article 1212 of the Civil Code of Ukraine. At the same time, paragraph 102.1 of Article 102 of the Tax Code of Ukraine prescribes the period within which a controlling authority may itself determine the amount of a taxpayer’s monetary obligations. The disputed legal relations are not of a tax nature; consequently, limitation periods in respect of them are governed by civil legislation.

The company’s cassation appeal was dismissed and the judgment of the commercial court of appeal was left unchanged.

Judgment of the Commercial Cassation Court of the Supreme Court of 15 September 2026 in case No. 908/3774/23 – https://reyestr.court.gov.ua/Review/140064187.

This and other legal opinions of the Supreme Court are available in the Database of Legal Positions of the Supreme Court - https://lpd.court.gov.ua.