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Budva avoids millions in damages

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Budva Sidesteps Millions in Damages

The Supreme Court has dismissed the appeal from the National Bank of Serbia regarding the High Court’s ruling, meaning the Municipality of Budva is not at risk for the millions in damages claimed by the leading financial institution of the neighboring country concerning the former Villa Medin in the heart of the Old Town.

“The plaintiff’s appeal is deemed unfounded,” states the verdict accessed by “Vijesti.”

It is important to note that the Higher Court in Podgorica’s judgment from May 14, 2024, rejected the National Bank of Serbia’s appeal, affirming the decision made by the Basic Court in Kotor.

The Basic Court in Kotor previously rejected the claim where the National Bank of Serbia contended that, as the legal successor of the Social Accounting Service in the SR Serbia – Head Office in Belgrade, it was entitled to compensation for real estate expropriated based on the Municipality of Budva’s Expropriation Decision dated November 5, 1988.

“The claim requiring the Municipality of Budva to pay the National Bank of Serbia the sum of 5 euros, plus statutory default interest from November 1988, amounting to 705,608.00 euros for expropriated property, is rejected. Additionally, the claim for 172,208.00 euros, with statutory default interest from November 28, 2013, for expropriated city construction land is also rejected,” the ruling specifies.

The National Bank has asserted that it filed a review against the judgment, citing significant violations in civil procedure and incorrect application of substantive law, requesting that the Supreme Court of Montenegro annul the contested ruling and return the case for reconsideration.

“Upon reviewing the case file, this court assessed the contested judgment according to Article 401 of the Civil Procedure Law (CPL) and found the appeal to be unfounded. There were no significant procedural violations in the proceedings of the first and second instances, which the appellate court must monitor ex officio. The noted procedural violations indicated in the review do not apply, as the second instance judgment is clear and consistent with provided reasoning,” states the Supreme Court’s judgment.

“Vijesti” previously reported that the dispute’s value was 1,648,483.64 euros.

The Municipality of Budva has been represented throughout the prolonged dispute by the Secretariat for Property Protection.

During the proceedings, the National Bank of Serbia declared that following the expropriation decision favoring the “Stari grad” Labor Organization in early November 1988, the SDK in Serbia filed an objection, which was dismissed in April 1989. A lawsuit challenging this decision was also rejected in June 1990, rendering the expropriation final and binding.

“After the expropriation ruling became legally binding, RO ‘Stari grad’ was registered as the holder of management and usage rights. Post-liquidation of RO ‘Stari grad’, these rights were transferred to the Municipality of Budva. According to Clause 6 of the expropriation ruling, the Municipal Department for Urbanism and related bodies were responsible for processing compensation for the expropriated property, which they never did. Consequently, the National Bank pursued non-litigious proceedings to determine compensation. However, as the Municipality contested this, the Basic Court terminated the non-litigious proceedings in April 2013, directing the National Bank to seek relief through litigation,” was noted during the proceedings.

The Secretariat for the Protection of Municipal Property objected to the active legitimacy claiming, based on an examination of land records, that the National Bank of Serbia’s legal predecessor never owned the contested property, which is public property acquired through nationalization.

A Turbulent History and Heirs Seeking the Mansion

The former Villa Medin was constructed in 1939 as a modern resort featuring 22 rooms and 38 beds, situated in the most luxurious building in the Old Town. Following World War II, Yugoslavia nationalized the property from the Medin family of Stari Budva. Subsequently, it became the property of the National Bank of Yugoslavia, which converted it into a resort for its employees.

The resort sustained significant damage during a devastating earthquake in 1979, leading to the reconstruction of Old Town, including the villa.

Another wave of nationalization occurred in 1988 when the Municipality of Budva assumed control of the building, appointing the “Stari Grad” Labor Organization as its manager.

Although situated in the thriving center of Stari Rad, the building has remained unused for years. One side overlooks Brijeg od Budve beach, while the other faces Poet’s Square.

The narrative surrounding Villa Medin, a pioneering hotel in Budva that boosted elite tourism in the region, reflects the state’s attitude towards its citizens and the ongoing battles heirs of the Old Town family face to reclaim valuable property seized nearly eight decades ago.

As previously reported by “Vijesti,” heirs have permitted the villa to undergo cleaning, but have barred renovation work, asserting that it remains subject to restitution and must be returned to rightful owners.

“The Medin family has historical roots in Budva dating back to 1705, when our ancestor Christopher Medin moved from Kastel Lastva (Petrovac) to Old Town. Past generations resided in a family building at Njegoševa 2, where they operated a shop on the ground floor. With tourism’s rise in Budva, some families, including ours, began investing in hotel and guesthouse construction. My grandfather, Ivo Medin, alongside my grandmother, was amongst those investors, initiating hotel construction in the mid-1930s,” stated Ivan Vukovic, one of the heirs, who resides in Veli Lošinj, Croatia.

He elaborated that after the death of his grandmother Olga in 1938, their six children became co-owners of the hotel alongside Ivo. The hotel commenced operations in early 1939 as it completed its construction and furnishing.

“The hotel functioned until the April 6, 1941 attack on Yugoslavia,” he recounted.

“Following the attack, the hotel was shuttered, and my grandfather, his brother Nikola, and our parents were relocated. Subsequently, nationalization processes commenced, resulting in the erasure of ownership rights of previous owners, including Ivo Medin and his children, and transferring management rights to the Municipality of Budva. Our family was forced back to the old house, while the Villa Medin fell into the hands of SDK Yugoslavia. Although the villa withstood the 1979 earthquake, its destruction was ultimately brought upon by the authorities,” Vuković remarked.

Plans for Cultural Center Adaptation and Conversion

The President of the Municipality of Budva, Nikola Jovanović, declared an intention to adapt and transform Villa Medin into a Cultural Center.

“Through careful adaptation, Villa Medin will initiate our endeavor towards a future cultural center which aims to be a hub for all cultural entities in the city,” Jovanović previously shared with RTV Budva.

The adaptation plan will establish a unique environment where local cultural institutions can present their activities, host events, and collaborate effectively.

“The Old Town deserves a distinguished cultural venue that will celebrate the contributions of our institutions and artists,” Jovanović emphasized.

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