A Constitutional Court has increased to almost €500,000 the compensation awarded to the co-owners of a St Julian’s seafront palazzo over a consistent breach of their right to the enjoyment of their property.
The owners of the property, where the St Julian’s Band Club now stands, had earlier this year been awarded €300,000 in moral and pecuniary damages, but they appealed, arguing that the compensation was too little. The Attorney General, on the other hand, appealed the judgment saying the award was hefty.
But the Constitutional Court, president over by Mr Justice Giannino Caruana Demajo, Mr Justice Tonio Mallia and Mr Justice Noel Cuschieri upheld their argument, ruling they not only received lower rent than they were due but the fact it was rented out for such an amount had also affected the value of their property.
The seafront property was leased to the band club 90 years ago and was at the centre of a 19-year court saga sparked off by one of the owners, Anna Galea, and taken up by her successors in title, the Galea Salomone family, together with Mercury Investments Ltd.
The owners successfully argued that their fundamental right to the full enjoyment of their property had been breached.
The premises situated along St George’s Road had been rented by the original owner Antonio Ellul to the St Julian’s band club in February 1927 against an annual rent of Lm43, equivalent to €100.
Owners deprived of their right to the full enjoyment of the property
Part of the premises was eventually sub-let to third parties to be run as a bar and restaurant, prompting Mr Ellul’s successors in title to attempt to put an end to the situation, which was effectively depriving them of their right to the full enjoyment of the property.
As from March 2000, they refused to accept payment of the rent, while filing proceedings before the Rent Regulation Board seeking termination of the lease on the grounds that both the sub-lease and the change of use of the tenement had been effected without their consent.
In 2005, the board rejected the claim, a decision confirmed a year later when the court of appeal threw out the landlords’ appeal.
The landlords instituted constitutional proceedings against the Attorney General in February 2013, claiming the fact that they were barred at law from terminating the lease or revising the rent payable amounted to a breach of their property rights as safeguarded under the European Convention.
The landlords argued that amendments to letting laws had not improved the conditions of owners of leased commercial premises who were still bound to renew the lease and could not change letting conditions unless authorised by the board.
In this case, not only had the board and the Appeals Court rejected their claim, but the band club’s decision to sub-let the property as a bar and restaurant to third parties had been allowed to stand, thereby allowing the tenants to reap considerable benefits at the expense of the landlords, who received a pittance.
The court noted that, according to a private architect, the current market value of the property stood at €2.6 million, while its rental value as a commercial premises in 2010 was calculated at some €152,000 a year.
The court therefore increased the compensation to €492,000, including €12,000 in moral damages “to make good for the frustration and state of uncertainty placed upon them.”
Lawyer Paul Cachia assisted the applicants.