An Mdina Palazzo the subject of a landmark human rights judgment

Author: Christian Ellul, Trainee Associate

In the case of Mark Pace vs State Advocate et the Civil Court, First Hall (Constitutional Jurisdiction) presided by Mr. Justice Joseph Zammit McKeon, during his last court sitting following an illustrious career on the bench, gave yet another landmark judgment on the 18th of March 2021, awarding the owner of a historic Mdina Palazzo, €1, 017,826 in damages after declaring that the application of Chapter 158 of the Laws of Malta over the said property violated the applicants fundamental rights.

The property subject to the Constitutional proceedings is “Palazzo Gourgion” prominently situated in St. Paul’s Square in Mdina. In 1976 by means of a private writing the predecessors in title of the applicant leased this historic Palazzo to the late husband of the respondent. Although the original rent period was for a period of 10 years, the owners of the Palazzo were caught within the shackles of the legal amendments introduced by Act XXIII of 1979. Through these amendments, Maltese tenants who were at the time residing in ordinary residences subject to ground rent or subject to lease over decontrolled property acquired the right to continue residing in such premises practically indefinitely. The court reasoned that as a result, Chapter 158 gave the respondent lessee the right to continue renewing such lease making it practically impossible for the applicant to take back possession of his property.

The court after making an in-depth analysis of the obtaining jurisprudence emanating both from the Constitutional Court and the European Court of Human Rights upheld the claims of the applicant holding that Chapter 158 of the Laws of Malta, more specifically Article 5 of that act, violated the applicants’ right to property under Article 37 of the Constitution and Article 1 Protocol 1 of the European Convention on Human Rights.

In determining the pecuniary damages to be awarded, the court enunciated several factors to be taken as guide in determining the amount to be liquidated. It held that the starting point is the “maximum lease value”. According to the court appointed expert, this amounted to €2,649,754 for the period between December 1986 up till November 2019 which corresponds to the period during which the lessee enjoyed protection under the aforesaid law. From this amount, the rent already paid was deducted followed by a further 35% deduction attributable to the “legitimate intervention of the state” through such legislation. Finally this amount was subject to an additional 35% deduction attributable to what the court referred to as the passiveness of the applicant in waiting a number of years before taking action.

Through this methodical exercise the court arrived at a final figure of €1,012,826 that was liquidated as pecuniary damages whereas an additional €5,000 were awarded as non-pecuniary (moral) damages, both payable to the applicant by the state. While the court fell short of ordering eviction, obiter dictum, it held that the respondent cannot continue resting on protections granted under Chapter 158 of the Laws of Malta to continue living in this prestigious Palazzo.

The applicant owner was assisted by Dr Edward DeBono, Dr Karl Micallef and Dr Nicholas DeBono

Full article on the Sunday Times of Malta may be read here: