YOU ARE HERE: LAT HomeCollections

National Agenda : Germany's Unity Results in a House of Contention : Berlin's 'House of Democracy' is at the center of a legal dispute that reflects the complex property claims in the post-Communist era.


BERLIN — The five-story, 19th-Century office building sits on a prime piece of real estate at the heart of eastern Berlin, and in many ways it symbolizes the democratic spirit that led to the collapse of the Berlin Wall.

Known as "The House of Democracy," the block that once was home to the Berlin Communist Party became a focal point of East German political activity after the country's last Marxist government reluctantly turned it over to the grass-roots groups like New Forum and the Independent Assn. for Women that had led the popular uprising.

The Communists eventually sold the building for a token $40,000 in November, 1990, to a collection of those citizen groups, and the vanguard of the revolution believed it had a secure, convenient, low-cost base from which it could conduct its activities.

Then came the claims. The citizen groups' principal attorney, Bernd Hoffmeister, says he's lost track of the exact number but that dozens of companies or individuals are now claiming ownership of at least part of the House of Democracy and the land on which it sits--property valued at around $30 million.

As legal tangle entwines with legal tangle, the House of Democracy has gradually come to epitomize a seamier side of post-revolutionary Eastern Europe--the fight over who owns property confiscated during the Communist era.

In Germany, no problem has proven more emotionally wrenching, socially divisive or economically draining. The boarded-up doors and provisional lighting in the House of Democracy's foyer reflect a common problem with such disputed property: No one wants to invest in it until ownership is clarified--in this case, a process that will likely take years. Since the fall of the Berlin Wall in November, 1989, the government has received 2,470,000 ownership claims to property in the former East Germany. Severe shortages of judges and clerical courtroom staff in the new eastern states mean that so far, fewer than 5% of these claims have been resolved. And most of those familiar with the problem believe litigation will drag on well into the next century.

The House of Democracy underscores the complexities. Constructed by the Pschorr family of Munich brewers in the late 1880s as a northern regional headquarters, the building remained in the brewery's hands until 1941, when it was taken over by a group of coal producers put together by Adolf Hitler's Luftwaffe chief, Hermann Goering.

Goering, also director of a four-year Nazi economic plan at the time, wanted to coordinate energy resources flowing into the Third Reich, including those from Silesian coal fields of newly conquered Poland. This part of the Nazi war effort--which is said to have provided fuel to Auschwitz and other concentration camps and to have employed slave labor--was administered from the building.

When the Third Reich collapsed in May, 1945, the structure was confiscated by occupying Soviet forces, who eventually passed it on to the East German Communist Party in 1949.

In addition to the Pschorr family, claimants for the property today include:

* The large Hannover-based energy conglomerate Preussag AG, which traces its roots in part back to the Upper Silesian Coal Syndicate, an entity swallowed by Goering.

* A total of 28 other, smaller, private companies that were also part of the same Silesian coal syndicate.

* American relatives of a Jewish woman who argue she was forced to sell her share in the brewery during the 1930s at less than the fair-market value because of Nazi persecution of the Jews.

* Half a dozen dispossessed Prussian counts, whose family coal mines have long since disappeared into postwar Poland but whose headquarters were in the disputed building.

As if that weren't complicated enough, at least one other legal question must be resolved before the multiple claimants fight it out. While normally the legal owner has the right to demand the return of his property rather than being forced to accept compensation, the case of the House of Democracy might not be normal. Wording in the 1990 treaty between the two Germanys and the four victorious World War II Allied powers--a treaty that restored sovereignty to a united Germany--excludes, at Moscow's insistence, the return of any property redistributed during the period of Soviet military occupation. That period ended with the official founding of the East German state in October, 1949.

The House of Democracy was handed over to the Berlin Communists in February, 1949--so the citizen groups now in possession of the property argue that the other claimants are at most entitled to compensation. The claimants, however, say the public listing of the transfer only occurred in November, 1949--a month after the Soviet occupation ended--and that therefore the property must be returned.

Los Angeles Times Articles