Published on 19 September 2022

FIRST SECTION

Application no. 38114/21 Mark PACE and Others against Malta lodged on 23 July 2021 communicated on 29 August 2022

SUBJECT MATTER OF THE CASE

The application concerns an imposed commercial lease on the applicants’ property, consisting of part of the British Hotel, Valletta, as a result of the application of Chapter 69 of the Laws of Malta whereby the tenants were paying annually approximately 1,634 euros (EUR), increased according to inflation every three years as of 2009. The applicants acquired the various share of the property via a number of inheritances which devolved onto them from 1986 to 2015.

The applicants lodged constitutional redress proceedings complaining, inter alia , of a breach of Article 1 of Protocol No. 1 in their respect.

According to the court-appointed expert, bearing in mind its development potential, including changes such as transforming the cellar into a commercial wine bar, and other changes allowing for the addition of further catering outlets and hotel rooms, the property’s sale value in 2018 was EUR 5,200,000 and its annual rental value EUR 249,600. Using yields varying from 3.5 % to 4.8 %, she considered that the estimated annual rental value in the period 1967-1972 as being EUR 4,025, that in 1973-78 EUR 4,550, that in 1979 ‑ 1984 EUR 5,750, that in 1985-1990 EUR 5,775, that in 1991-1996 EUR 9,800, that in 1997-2002 EUR 16,975, that in 2003-2008 EUR 29,750, and that in 2009-2014 EUR 108,000. Another architect estimated the sale value as being EUR 4,000,000 bearing in mind the improvements made by the tenants and EUR 3,470,000 without such improvements.

By a judgment of 17 June 2020 the Civil Court First Hall in its constitutional competence found a violation of Article 1 of Protocol No. 1 and, bearing in mind relevant factors, awarded EUR 510,000 in compensation for the period 1987 to 2018, which included EUR 10,000 in non-pecuniary damage. It refused to evict the tenant but ordered that the tenant may no longer rely on the impugned law to maintain title to the property.

The defendants appealed but by a judgment of 28 January 2021 the Constitutional Court confirmed the first instance judgment, altering solely the order of costs. It considered, inter alia , that it was too late at that stage to challenge the court appointed expert’s opinion as to the estimates made. However, it was relevant that the tenants had made extensive improvements to the property in the tune of EUR 380,000 which would be to the benefit of the applicants once the property was returned to them (according to law in 2028), and which had an impact on the rental values calculated as used to estimate their losses. However, on the assumption that the owners were in favour of such changes (otherwise they could have evicted the tenants earlier) the applicants could also ask for repayment of those expenses once the lease expires.

The applicants complain under Article 1 of Protocol No. 1 alone and in conjunction with Article 13 of the Convention that they are still victims of the violation found, the constitutional jurisdictions having failed to award appropriate redress and evict the tenants.

QUESTIONS TO THE PARTIES

1. Are the applicants still victims of the violation of Article 1 of Protocol No. 1 to the Convention upheld by the domestic courts? In particular, have the applicants been awarded appropriate redress? The parties should update the Court in respect of any eviction proceedings undertaken against the tenants or any agreement reached in respect of the rent payable.

2. Has there been a violation of Article 1 of Protocol No. 1 to the Convention?

3. Did the applicants have at their disposal an effective domestic remedy for their complaint under Article 1 of Protocol No. 1 to the Convention, as required by Article 13 of the Convention?

APPENDIX

No.

Applicant’s Name

Year of birth

Nationality

Place of residence

1.Mark PACE

1950Maltese

St. Julian’s

2.Maria ARRIGO

1949Maltese

Siggiewi

3.Maria Pia GALEA

1956Maltese

St. Julian’s

4.John PACE

1964Maltese

Lija

5.Alessandra RADMILLI

1948Maltese

Sliema

6.Paul RADMILLI

1976Maltese

Lija

7.Rachel RADMILLI

1972Maltese

St. Julian’s

8.Louis Joseph SANT CASSIA

2021Maltese

Wardija