FOURTH SECTION

Application no. 14796/11 Maria Theresa DEGUARA CARUANA GATTO and others against Malta lodged on 4 March 2011

STATEMENT OF FACTS

The applicants, Ms Maria Theresa Deguara Caruana Gatto , Ms Maria Theresa Gera, Ms Victoria Amato Gauci , Mr An drew Amato Gauci , Mr Philip Amato Gauci , Mr Louis Ama to Gauci , Ms Giovanna Soler , Mr Nicholas Jensen, Ms Irene Bach, Ms Agnes Gera de Petri, Ms Caren Preziosi , Mr Alfred Gera de Petri (in his capacity of testamentary executor of the inheritance of Alfio Testa Ferrata Bonici Ghaxaq ), Ms Anna Maria Spiteri Debono , Maltese nationals a nd Ms Francesca Amato Gauci , Ms Tanya O ’ Brien, Mr Joseph Gerard Amato Gauci , Ms Mariella Reimer, Ms Christianne Huber, Canadian nationals, who were born in 1923, 1937, 1940, 1979, 1981, 1967, 1944, 1954, 1950, 1949, 1952, 1944, 1961 1979, 1974, 1968, 1964, 1965 respectively. They were represented before the Court by Dr I. Refalo , a lawyer practising in Valletta .

A. The circumstances of the case

The facts of the case, as submitted by the applicants, may be summarised as follows.

1. Background of the case

The applicants and/or their predecessors were owners of properties numbers 223, 224, 225, 226 and 227 Marina Street Msida , Malta .

On 31 August 1990 the President of Malta declared that the said properties were to be expropriated.

The owners were notified with a Notice to Treat dated 22 May 1991 by virtue of which they were informed that the amount being offered in compensation for the said property was 129,000 Maltese liras (MTL), approximately 300,500 euros (EUR).

By means of a judicial letter dated 29 May 1991, the owners (except for the last two applicants) declared that they would not accept the compensation offered and that they considered MTL 380,000 (approximately EUR 885,150) to be just compensation. The last two applicants also contested the compensation offered by means of a judicial letter of 14 June 1991 in which they stated that they considered MTL 250,000 (approximately EUR 582,350) to be just compensation.

On 21 October 1993 the Commissioner of Lands (“ CoL ”) deposited the sum of MTL 129,000 in court by means of a schedule of deposit (in accordance with Article 22 (4) of Chapter 88 of the Laws of Malta).

On 25 January 1994 the CoL initiated proceedings before the Land Arbitration Board (“LAB”) to establish the compensation due for the above-mentioned property. The two court-appointed architects (F.V. and J.M.) estimated the total value of the property together with other tenements (numbers 2, 3 and 4 Qrejten Street , Msida ) at MTL 205,500 (approximately EUR 478,700).

By a judgment of 10 October 1996 the LAB found that the compensation payable for all the properties was MTL 205,500.

The applicants alleged that tenements numbers 2, 3 and 4 Qrejten Street , Msida , were the subject of another court case that has never been decided.

2. Retrial proceedings

On 10 January 1997 the CoL lodged an application for the judgment of 10 October 1996 (case 2/94) to be retried, on the basis that the judgment had covered other property which was not the subject of the case and that it had not taken account of the amount already deposited in court. He subsequently maintained that if the application for retrial was upheld the same two architects originally appointed should be retained.

In a hearing of 4 June 2002 the applicants did not object to the case being retried. The LAB appointed architects R.L. and J.J. and adjourned the case for judgment.

By means of an application dated 4 October 2002 the CoL requested the LAB to revoke its previous decision to appoint architects R.L. and J.J. since it had not given a separate judgment authorising the retrial, and because there had been no reason to replace the architects. He requested the LAB to order a retrial.

On 8 April 2003 the LAB revoked the judgment of 10 October 1996 and ordered the retrial be started on the same day. In another decision of 8 April 2003 it considered the CoL ’ s application contesting the architects ’ appointment. Considering that it could not have appointed architects before it had decided the request for retrial, the LAB revoked its decision of 4 June 2002. The minutes of the hearing read that application no. 1/97 had been decided in part; however, since the LAB as constituted did not have competence to hear the case, it suspended the case sine die , for a different board to be composed.

Subsequently the parties requested that the proceedings be resumed, both of them citing case no. 1/97, and the new chairmen of the LAB, not having noticed the error, rescheduled case no. 1/97. The parties made submissions regarding the appointment of the architects and the case regarding the compensation due was adjourned to 20 October 2003.

In the meantime Act XVII of 2004 (“the Act”) was promulgated, inter alia , amending Article 25 (1) of Chapter 88 (see relevant domestic law) by adding a proviso to the effect that compensation awarded should not exceed the higher amount of compensation proposed by any of the parties. The Act came into force on 23 December 2004 and according to its Article 4 (2) the above provision had retrospective effect (see relevant domestic law).

Following a number of adjournments, by a decision of 12 September 2005 the LAB appointed R.L. and J.J. as architects and fixed a term of two weeks for them to present a report in the light of the amendments. R.L. and J.J. had inspected the property two years earlier, on 4 September 2003, in connection with the proceedings concerning properties nos. 2, 3 and 4 in Qrejten Street , Msida .

Following a number of adjournments, by a judgment of 27 March 2006 the LAB noted that the architects had initially valued the properties at MTL 1,681,895 (approximately EUR 3,032,600) but could not re-evaluate the properties since they had been demolished. However, it further noted that the court could not award more than had been requested, in accordance with the new 2004 law. It awarded compensation of MTL 380,000, that being the highest amount claimed by the parties, of which MTL 129,000 had already been deposited in court.

The applicants appealed (by means of two quasi-identical appeal applications) claiming that compensation should be in accordance with the value established by the architects. They complained that at the time when the proceedings before the LAB commenced, including those for retrial, the compensation due to them was not subject to capping, but was to be based on the value of the property on an open market on the day of the Notice to Treat as established by the architects and the LAB. Thus, the retroactive application of the law affected their right to receive fair compensation, in violation of their property rights, both because their legitimate expectation to be awarded fair compensation had been interfered with, and because the actual amount eventually awarded did not constitute fair compensation. Moreover, the length of the proceedings before the LAB had breached their right to a fair trial within a reasonable time, with further consequences on their property rights – both in respect of the changes to the law and the principle of compensation within a reasonable time.

The CoL also lodged an appeal, on the basis of various aspects regarding the court-appointed architects under the principle of independence and impartiality.

By a decision of 24 January 2007, the Court of Appeal, in its inferior jurisdiction, referred the following issues to the Civil Court (First Hall), in its constitutional jurisdiction: i ) whether there had been a violation of the applicants ’ property rights, and ii) whether there had been a violation of the right to a fair hearing as the CoL complained. No referral was made in respect of the applicants ’ complaint regarding the length of the proceedings.

3. Constitutional Referral

The Civil Court (First Hall), in its constitutional jurisdiction, noted that the applicants raised the following claims i ) the alleged violation of Article 1 of Protocol No. 1 since they were not awarded adequate compensation, it having been limited by a legislative interference; ii) a violation of Article 17 in conjunction with Article 1 of Protocol No. 1 in so far as the legislative interference was planned to eliminate rights deriving from the Convention iii) a violation of Article 6 in that the compensation proceedings were not decided within a reasonable time with the consequence this had on their property rights in view of the amendment, and because of the amendment itself in that it breached the principle of equality of arms.

By a judgment of 27 November 2008, the Civil Court (First Hall), in its constitutional jurisdiction, declared that the 2004 amendment had violated the applicants ’ property rights under Article 1 of Protocol No. 1. It declared the decision of 27 March 2006 null and void and ordered the case to be remitted to the Court of Appeal and that compensation be established in accordance with the law as it had stood before the said amendment. No violation of the right to a fair trial could be upheld vis-à-vis the CoL .

The CoL appealed and the applicants cross-appealed, the latter making submissions about the alleged violation of their rights under Articles 6 and 17 of the Convention.

The Constitutional Court considered that the applicants ’ complaints revolved around two matters: i ) the retroactive application of the new law which allegedly violated their legitimate expectation to compensation as established by the laws in force, thus denying them part of their compensation, and ii) the lack of adequate compensation awarded to them.

By a judgment of 6 September 2010 the Constitutional Court noted that the Court of Appeal in its inferior jurisdiction had not had jurisdiction to hear the merits of the case, it being the competence of the Court of Appeal in its superior jurisdiction. Nevertheless, it considered that the reference made by the Court of Appeal in its inferior jurisdiction, was, in itself, valid, and that it had not included the issues arising under Articles 6 and 17, which therefore could not be entered into, the courts with constitutional jurisdiction being limited to decide only what had been referred by the Court of Appeal. The Constitutional Court reversed the first-instance judgment in part, upholding the part of the judgment in respect of the CoL ’ s complaint and quashing the rest. It considered that before the 2004 Act the LAB could establish compensation higher than that requested by the parties, thus the Act did not concern a clarification of the law but a limitation on the compensation which could be awarded. Nevertheless, the applicants did not have a possession under Article 1 of Protocol No. 1 in that they had had no legitimate expectation to receive an amount higher than MTL 380,000 (as established by their ex parte expert) which they had claimed. Firstly, at the time the amendment was introduced the report of the new architects had not yet been submitted to the case file. Secondly, before the amendment the applicants had not claimed compensation higher than that awarded, and thirdly when architects R.L. and J.J. were appointed the applicants had been aware of the new legislation. Moreover, the applicants had received fair compensation since they had obtained the entire sum they had asked for. Indeed, it was clear that the value given by the court-appointed experts was in stark contrast with that given by earlier experts and that of the ex parte experts; it was therefore arbitrary and disproportionate as no reasons had been given justifying this huge difference. Thus, the amendment had not violated the applicants ’ rights under Article 1 of Protocol No. 1. As to the fact that twenty years had passed before the compensation had been paid, the court considered that part of the monies had already been deposited and could have been withdrawn by the applicants without prejudice to further proceedings. Moreover, the applicants had eventually been awarded triple that which had been offered to them at the time of the expropriation and were still to receive 5% interest on the amount, thus the applicants were not suffering an excessive individual burden. It ordered the case to be remitted to the Court of Appeal in its superior jurisdiction for the continuation of the case.

4. The continuation of the case

By a judgment of 25 February 2011 the Court of Appeal in its superior jurisdiction held that the judgment of 27 March 2006 was null and void owing to a procedural defect, namely in so far as the impugned decision had been given within the ambit of case no. 1/97, and not those proceedings on the merits relating to compensation no. 2/94. Indeed the relevant proceedings were never rescheduled following their adjournment in 2003. This had been owing to the parties themselves, both the State and the applicants, who had cited the wrong number when requesting the rescheduling of the case, and to the LAB chairman who had confirmed their error. The Court of Appeal considered that it was not in a position to order the correction of the relevant case numbers. Thus, in the circumstances no appeal could be entertained.

In consequence, there has to date been no judgment establishing the amount due in compensation for the property expropriated more than twenty years ago.

By a judicial letter of 25 March 2011, the applicants asked the CoL to take the relevant measures to determine the amount of compensation payable for the expropriation. No reply was received.

B. Relevant domestic law

Act XVII of 2004 added a proviso to Article 25 (1) of the Land Acquisition (Public Purposes) Ordinance, Chapter 88 of the Laws of Malta, which was changed to read as follows:

“(1) The Board shall be competent –

...

( e ) to assess the amount of compensation payable under any of the provisions of this Ordinance and for that purpose to declare whether any area is a building site or agricultural or waste land;

...

Provided that the amount of compensation to be assessed by the Board in accordance with the provisions of paragraph ( e ), shall not exceed the higher amount of compensation as proposed by any of the parties.”

The transitional provision, Article 4 (2) of Act XVII of 2004, reads as follows:

“The provisions of Articles 25 and 31 of the Ordinance as amended by this Article shall apply to any proceedings relating to any land covered by any declaration issued under Article 3 of the Ordinance even if issued prior to the date of the coming into force of this Article.”

COMPLAINTS

The applicants complain under Article 1 of Protocol No. 1 to the Convention that, as the situation stands at the moment, the offer of compensation amounting to MTL 129,000 does not reflect adequate compensation for the expropriation of their land. Moreover, the inordinate delay in establishing compensation also impinged on their right to obtain compensation within a reasonable time in accordance with Article 1 of Protocol No. 1. Furthermore, the fact that legislative amendments interfered with their rights in the context of pending proceedings resulted in a situation where a lower amount of compensation would be awardable to them. In their view this breached their rights under Article 1 of Protocol No. 1 and Article 17 of the Convention. The applicants also complain that the fact that more than twenty years after the taking of the property the applicants are still pursuing compensation due to them is in violation of their right to a fair trial within a reasonable time. Lastly, invoking Article 13 of the Convention, they considered that the domestic courts had not provided a remedy for their complaints under Articles 6 and 17 of the Convention and Article 1 of Protocol No. 1 alone and in conjunction with Article 6.

QUESTIONS TO THE PARTIES

1. Did the deprivation of property, within the meaning of Article 1 of Protocol No. 1, in the present case impose an excessive individual burden on the applicants, particularly in view of the law as it stands and the delay leading to the lack of compensation to date?

2. Did the applicants have a fair hearing in the determination of their civil rights and obligations, in accordance with Article 6 § 1 of the Convention? In particular, was there interference by the legislature with the administration of justice designed to influence the judicial determination of a dispute? If so, was the interference based on compelling grounds of general interest? Lastly, was the interference compatible with the principles of legal certainty ( Zielinski and Pradal and Gonzalez and Others v. France [GC], nos. 24846/94 and 34165/96 to 34173/96, ECHR 1999-VII, and Scordino v. Italy (no. 1) [GC], no. 36813/97, ECHR 2006-...)?

3. Was the length of the proceedings in the present case in breach of the “reasonable time” requirement of Article 6 § 1 of the Convention?

4. Did the applicants have a fair hearing in the determination of their civil rights and obligations in accordance with Article 6 § 1 of the Convention? In particular, was the domestic court ’ s decision of 25 March 2011 based on a restrictive interpretation of procedural rules such as to undermine the very essence of the applicants ’ right to court (for the determination of their compensation)?