Kaido Tamberg, the former mayor of Sangaste, who was previously a member of the Social Democratic Party (SDE), was found guilty in the criminal case of, among other things, selling the municipality's stake in the Sangaste Manor limited company in 2017. A few years earlier, Sangaste Municipality had transferred ownership of Sangaste Castle to the limited company.

Tamberg transferred the municipality's stake on unfavorable terms and as a result, the municipality did not receive approximately 80 percent of the contracted sale price. The municipality then filed a claim for damages of €600,000 against Tamberg. Although both the county and circuit courts found the accused guilty of the unlawful transfer of the municipality's assets and penalized Tamberg, they did not award any damages.

The Supreme Court held that some senior officials, including members of the municipality and the city administration, cannot be subject to a provision of the law imposing pecuniary liability on officials. This does not mean, however, that the officials in question are exempt from compensation for the damage caused to the employer.

A municipality or a city is a legal person and can claim damages from a member of its government on the basis of a rule which provides for the liability of a member of the governing body of a legal person.

According to the ruling, Tamberg is required to compensate the municipality for the damage he caused by failing to comply with his obligations. The mayor has, among other things, a duty to have regard for the property interests of the municipality. He is required to act in good faith and in the interests of the municipality and not take unjustified risks on the municipality's behalf.

In addition, he must avoid conflicts of interest and must not put personal interests before the interests of the municipality. Even the approval of the municipal council cannot, in general, justify the actions of a mayor which are manifestly in conflict with the mayor's duties and the property interests of the municipality.

The General Court found that Tamberg had breached his obligations. He sold municipal property to a non-profit association that did not have the money to pay for it, and Tamberg knew this. Tamberg immediately handed over the sold property to the buyer, promising the latter would pay the purchase price only after four years.

At the same time, he did not require the buyer to provide a guarantee that the municipality would receive the sale price. As a result, the municipality was already deprived of its stake in Sangaste Manor in 2017. However, the municipality received only €149,700 of the €749,700 sale price by the end of 2021. The rest of the money remains outstanding.

The Supreme Court agreed with the municipality that the calculation of the amount of damages to be claimed from Tamberg could be based on the sale price of the part of Sangaste Manor LLC that the municipality is unable to recover from the buyer.

At the same time, the General Court found that the courts had infringed procedural rules in determining the circumstances affecting the scope of the claim for damages. In order to correct this error, the Supreme Court sent the case back to the Tartu Circuit Court for a new hearing.

Judges Julia Laffranque, Heili Sepp and Nele Siitam dissented.

Tamberg does not see himself to blame

Kaido Tamberg, the former Mayor of Sangaste municipality, said he disagreed with the courts in relation to both the criminal punishment and the recovery of damages.

"I do not feel guilty. I feel like a victim of a judicial crime," Tamberg said, adding that he planned to appeal against everything he could.

According to Tamberg, the sale of Sangaste Castle was not his decision, but that of the Sangaste Municipality Council, which he complied with.

As for the possible claim for damages, Tamberg said he did not have €600,000 and did not plan to pay it to Otepää Municipality. "We will see with the bailiffs what we will pay or not," Tamberg said.

Tamberg said he had sold all the assets he owned on market terms to cover the legal costs he has incurred in the legal proceedings.

---

Follow ERR News on Facebook and Twitter and never miss an update!