The owners of a Fgura warehouse rented out to the same tenant for the past 45 years have been awarded almost €250,000 in compensation after a judge found their right to the enjoyment of their property was breached by the old rent laws.

The owners were deprived of their fundamental right to enjoy their property when they were forced to accept the paltry sum of €698.81 a year for the rental of their property, the court established.

The decision by the First Hall of the Civil Court, in its constitutional jurisdiction, was the latest in a long line of judgments declaring that the legal regime regulating pre-1979 leases placed a disproportionate burden on landlords and made it.

There is an equally long list of decisions by the European Court of Human Rights, which ordered the government to stop violating property rights.

Tailored in light of the social reality that prevailed in 1979, the Housing (Decontrol) Ordinance amendments had been introduced to ensure that people did not end up homeless. In doing so, however, it effectively kept the landlords from regaining their properties.

Over the years, legal amendments were done for the amount of payable rent to increase but this was still low when compared to the value of the property. However, Madam Justice Miriam Hayman found that even the amendments introduced in 2009 did not do justice with the Pace family who could not regain possession of their warehouse.

The court heard how the warehouse was rented out to Frank Borg since 1976 to store merchandise as well as a boat and his personal cars. It said the owners were forced into a landlord-tenant relationship and had suffered a disproportionate burden due to the only rent law regime.

In its considerations, the court said the country adopted the European Convention of Human Rights in 1987 so the breach was considered to have started then.

The judge quoted case law, both local and those delivered by the European Court of Human Rights, which defined the human right to the enjoyment of one’s property.

Disproportionate burden on landlords

This right comprised three distinct rules: the first is of a general nature and enunciates the principle of the peaceful enjoyment of property; the second rule, contained in the second sentence of the first paragraph, covers deprivation of possessions and subjects it to certain conditions; while the third rule, stated in the second paragraph, recognises that the contracting states are entitled to control the use of property in accordance with the general interest.

However, in this case, the court found that the laws and subsequent amendments failed to strike a balance of proportionality.

The judge said that the state had the right and the obligation to enact the laws it deems appropriate to control the use of the property according to the general interest.

However, in the exercise of this discretion to create a mechanism that protects a category of persons (tenants), it could not disproportionately trample over the rights of a category of other persons (property owners).

Failing that, it is the state that must bear responsibility for this imbalance.

Although the amendments made in 2009 brought substantial improvements, this was not considered sufficient to achieve the balance and proportionality that the state has the duty to reach between the rights of the tenants and the owners since an increase in the amount of the rent does not reflect the country’s economic and social reality.

The judge, therefore, ordered the state advocate to pay the property owners €247,700 in compensation, including €12,000 in moral damages.

Landlords must file separate proceedings before the rent regulation tribunal to be awarded an eviction order against their tenant.

The judge also ordered that a copy of the judgment is sent to the speaker of the house of representatives.


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