Emphyteusis is a contract whereby one of the contracting parties grants to the other, in perpetuity or for a time, a tenement for a stated yearly rent or ground-rent that the latter binds himself to pay to the former, either in money or in kind, as an acknowledgment of the tenure.
Originating in Roman Law, the contract of emphyteusis is a contract by which a grant of a right is made either in perpetuity or for a time to the possession and enjoyment of land, originally agricultural, subject to the keeping of the land in cultivation and the payment of a fixed annual rent, and/or other conditions.
Really, one would think there is no immediate connection to either playing fields or yachts alike.
And yet a contract of emphyteusis, actually two contracts of emphyteusis, were the subject of the judgment of First Hall, Civil Court of September 15 in the names ‘Malta Playing Fields Association vs Royal Malta Yacht Club u b’digriet tat-2 ta’ Ġunju 2016 ġew kjamati in kawża l-Awtorità tal-Artijiet (gia Kummissarju tal-Artijiet) u Sport Malta (gia l-Kunsill Malti għall-Isport)’.
The court here acceded to the claim proposed by the plaintiff association, thereby declaring that the Royal Malta Yacht Club held no valid title at law to occupy the premises in Ta’ Xbiex consisting of the lido in Triq ix-Xatt. It consequently ordered its eviction therefrom within a two-month period from when the judgment becomes res judicata, that is, finally adjudicated without the possibility of being pursued further by the parties.
The facts of the case where the following.
By a contract dated August 29, 2002, the government of Malta granted unto the plaintiff association the portion of land in question, that is the lido, by title of temporary empytheusis for a period of 49 years.
However, subsequently in 2008, and by presidential declaration, the same portion of land was expropriated, with the expropriation order citing public purpose.
Under local law, specifically under the Land Acquisition (Public Purposes) Ordinance, the President may declare any land to be required for a public purpose. Public purpose is widely defined as any purpose connected with exclusive government use or general public use, or connected with the public interest or utility (whether the land is for use by the government or otherwise).
By presidential declaration, the same portion of land was expropriated with the expropriation order citing public purpose
The validity of the said expropriation was soon, and successfully, contested by the plaintiff in proceedings separate to those being reported here. The aforesaid expropriation order was struck down by the Constitutional Court with same being declared in violation of Article 37 of the Constitution of Malta (protection from deprivation of property without compensation) and of Article 1 of the First Protocol to the European Convention on Human Rights and Fundamental Freedoms (protection of property) and, therefore, null and void.
Let us for the moment remember that ‘null and void’ here basically means unenforceable from the moment it was created.
As the proceedings before the Courts of Constitutional Jurisdiction progressed, by contract dated September 23, 2009, the then Commissioner of Lands (today the Lands Authority) and the then Kunsill Malti għall-Isport (today Sport Malta), granted unto the defendant club a larger parcel of land comprising the lido, equally by title of temporary empytheusis and equally for a period of 49 years!
Complicated? Not quite yet.
The main argument proferred by the Royal Malta Yacht Club was that, despite the decision of the Constitutional Court, ‘its’ contract of September 23, 2009, had never been rescinded or declared void. Contrarily, the plaintiff association argued that once the expropriation order was nullified and, therefore, unenforcable from the moment it was created, then any act subsequent thereto was similarly null and void.
Tasked with all this complexity, the court noted that, in view of the decision of the Constitutional Court, the contract dated August 29, 2002, between the government and the plaintiff association was still, to date, a valid contract, in virtue of which the government could not be considered as being absolute owner of the lido. The government’s rights were now limited to the receipt of payment of the yearly rent or ground rent and to the exercise of any residual rights thereon. The government had, after all, granted the lido to the plaintiff association.
Hence, and again in view of the judgment of the Constitutional Court and its retroactive effect, the government could not (subsequently on the contract of September 23, 2009) legally grant the defendant club a temporary empytheusis on the lido as, simplistically placed, it was not the absolute owner of the land.
Given that the remedy which a court of law grants must necessarily be limited to the interest which forms the basis of the suit, the court brushed aside a number of matters raised by the defendants, such as, whether the plaintiff association had effectively abided by the contractual terms originally imposed upon it in 2002, and whether or not the plaintiff was still managing local playing fields, as well as any matters relating to the plaintiff’s statute.
The pleas raised by the Lands Authority (arguing that none of the claims were directly directed at it) and Sport Malta (arguing that it has no power to determine the defendant club’s rights over the lido) as to them being non-suited, were described by the court as frivolous, particularly given the fact that they were parties to the 2009 contract.
The judgment is subject to appeal.
Parting question: what happens now to all the rent or ground rent paid by the Royal Malta Yacht Club in virtue of the contract dated September 23, 2009? One guesses that rather than playing or boating, it’s going to be more long-drawn litigation.
Keith Borg is a partner at Azzopardi, Borg & Abela Advocates.