A legal amendment introduced in 2018 which effectively prevented landlords from evicting band club tenants when they breached lease conditions breaches fundamental rights, Malta’s chief justice has decreed.
The amendment, which is applicable retroactively, was introduced into the Civil Code in July 2018 and effectively blocked any evictions of band clubs when they structurally altered their premises without the landlord’s permission.
Chief Justice Mark Chetcuti has now ruled that there was no “compelling public interest” to justify making the legal amendment applicable retroactively and noted that the state does not have “unlimited power to introduce legislation that impacted the outcome of pending court cases.”
The chief justice delivered his decision in a constitutional reference to the first hall, civil court in a judicial saga concerning the Stella Maris band club in Sliema that kicked off twelve years ago.
Landlords of the site at 7, Annunciation Square had filed proceedings before the rent regulation board, claiming that the band club tenants had carried out structural works at the premises without their consent and without them even being aware that the tenant had applied for planning permits.
The Stella Maris band club, which used the premises under a lease dating back to 1959, rebutted that those works were needed as ordinary maintenance.
The landlords had acquired the premises under a temporary emphyteusis dating back to 1876 and set to expire in 2026. The direct owner of the property was the Joint Office.
The rent regulation board threw out the landlords’ claim in 2017, prompting an appeal.
Yet pending appeal proceedings, the government had introduced the 2018 legal amendment which blocked evictions of band clubs when these undertook structural works without landlords’ consent, provided the works were related to the “philharmonic or social activities…..or activities performed by the band club” or when those works consisted of “improvements to the premises.”
That new law was to apply retroactively.
Just three months later, an appeals court found that while the landlords’ claim deserved to be upheld, it could not approve the non-renewal of the lease.
Landlords had sought and obtained a constitutional reference concerning the matter, since the retroactive application of the 2018 legal amendment could impinge on their rights.
The Stella Maris Band Club and the State Advocate argued that the 2018 amendment had a legitimate aim.
Minister Michael Falzon, who has served as club president since 2006, testified that maintenance works had been carried out at the club’s own expense and said the site was used for philanthropic activities and free music classes.
Another club official testified that structural interventions were needed in 1995 and 2003 to replace old wooden beams and other dangerous structures. An architect further confirmed that the roof had been reconstructed in line with planning permits.
Evidence showed that temporary structures at roof level had been replaced with a larger room and two toilets. Part of the spiral staircase had also been removed.
Chief Justice Chetcuti said that while the retroactive application of new laws was not automatically precluded, it had to be justified by a “compelling public interest”.
While band clubs enriched cultural heritage and helped the economy, no such public interest existed in this case, he found.
The court observed that the 2018 amendment was not designed to protect non-profit organisations from soaring rent values, but rather against those “repercussions brought about through their own conscious failure to abide by the obligations expressly laid down in the lease agreement.”
The wording of the amendment allowing such non-consensual structural alterations, was “too wide,” and the guarantee afforded to landlords would probably hardly mirror the losses incurred.
Not to mention further the uncertainty as to when the landlord could ultimately receive compensation for the contractual failures of his tenant, the court observed further.
In the light of such considerations, the Chief Justice declared that the 2018 amendment breached the landlords’ rights to a fair hearing and peaceful enjoyment of their property and consequently, Stella Maris Band Club could not claim protection in the ongoing dispute before the court of appeal.