CASE OF GHIGO v. MALTA
Violation of P1-1;Damage - question reserved;Costs and expenses award - domestic and Convention proceedings
Nicolas Bratza
4. The applicant was born in 1928 and lives in Tarxien (Malta). 5. Before 1973 the applicant bought a house in Malta, which he had planned to use as a home for himself and his family. In order to purchase this building, he had incurred debts. Subsequently, in 1973 he acquired by donation full ownership of another house, in Paola. The applicant alleged that he then changed his plans and wanted to sell the former house in order to pay off his debts and to move into the house in Paola with his family. 6. On 31 March 1984 the house in Paola was seized by the Government under a requisition order issued by the Director of Social Housing under the Housing Act (Chapter 125 of the Laws of Malta). 7. On 23 August 1984 the applicant was informed that possession of the house in Paola had been given to a certain Mr G. 8. In September 1984 the applicant introduced a judicial protest against the relevant government department. He alleged that the issuing of the requisition order and the allocation of his property to a third party was causing him hardship. In a judicial letter of 8 November 1984, the Director of Social Housing asked the applicant, in his capacity as owner of the house in Paola, to recognise Mr. G. as the tenant of the premises (section 8 of the Housing Act). 9. According to the Housing Act, the applicant was entitled to receive a requisition rent for the use of his property. However the applicant alleged that no rent had ever been fixed or offered to him and since the date of the requisition he had received no compensation. 10. The applicant subsequently introduced a claim before the Civil Court (First Hall). He alleged that the requisition order and the allocation of his property to a third party was in violation of Article 1 of Protocol No.1, as incorporated into Maltese law by Act XIV of 1987 (European Convention Act). The applicant has not produced the documents pertaining to these proceedings and has not informed the Court about their outcome. 11. On 12 October 1990, while the first proceedings were still pending, the applicant introduced a second claim before the Civil Court (First Hall), alleging a breach of his right to the enjoyment of his property. He requested the Civil Court to issue the orders and directions needed to redress the violation of his fundamental rights, including, if necessary, a declaration that the relevant sections of the Housing Act had been abrogated by the European Convention Act. 12. In a judgment of 30 October 1995, the Civil Court declared the applicant's claim incompatible ratione temporis with the provisions of the European Convention Act, as the facts complained of had occurred before its entry into force on 30 April 1987. The requisition had been effected in accordance with the law which was in force at the time, and no violation of the applicant's fundamental rights could be established. 13. The applicant appealed to the Constitutional Court. 14. In a judgment of 28 February 2005, the Constitutional Court rejected the applicant's claim. 15. It considered that the situation complained of was a continuing one and the applicant was accordingly affected by it after 30 April 1987. Therefore, the facts of the case fell within the competence of the domestic courts. 16. As to the merits of the applicant's claim, the Constitutional Court noted that the only evidence produced by the applicant was a report of his architect, which stated that the rental value of the house was 120 Maltese Liras (MLT) (approximately 288 euros (EUR)) per year at the time of the requisition, and MLT 250 (approximately EUR 600) per year at the date of the report (28 October 1993). However, when the defendant declared that the rental value as fixed by the Land Valuation Officer was MLT 23 (approximately EUR 55) per year, the applicant did not produce any new evidence in rebuttal. According to the Constitutional Court, this constituted a manifest fault on the applicant's part. Furthermore, he never initiated proceedings before the Rent Regulation Board for the determination of a fair rent for his house. 17. The Constitutional Court also noted that in the implementation of policies of a socio-economic nature the margin of appreciation of the State was very wide. It quoted the case of Connie Zammit v. Malta (no. 16756/90, Commission's report of 12 January 1991) and an excerpt from van Dijk's and van Hoof's book “Theory and Practice of the European Convention” concerning the interpretation of the notion of “general interest”. In the light of the above, the Constitutional Court held that the applicant had proved neither the hardship he alleged nor a violation of Article 1 of Protocol No.1. 18. According to section 2 of the Housing Act requisition means: “to take possession of a building or require the building to be placed at the disposal of the requisitioning authority.” 19. Until 1989 the Housing Secretary could issue a requisition order if he was satisfied that such a step was necessary in the public interest for providing living accommodation to certain persons or for ensuring a fair distribution of living accommodation. As in force at the time of the requisition of the applicant's house, section 3(1) of the Housing Act read as follows: “The Secretary, if it appears to him to be necessary or expedient to do so in the public interest or for providing living accommodation to persons or for ensuring a fair distribution of living accommodation, may requisition any building, and may give such directions as appear to him to be necessary or expedient in order that the requisition may be put into effect or complied with.” 20. After 1989 the authority to issue requisition orders was given to the Director of Social Housing. 21. A requisition order imposes on the owner of the requisitioned premises a landlord-tenant relationship. According to section 8(1) of the Housing Act, the Director of Social Housing may require the owner to recognise the person accommodated in his property as his tenant or sub-tenant. 22. The owner of the premises may seek authorisation for non-compliance with this request in accordance with section 8(2) and (3) of the Housing Act, which, in so far as relevant, provides: “(2) Within thirty days of service on him of a judicial letter under the last preceding sub-section, the requisitionee, by application to the First Hall of the Civil Court in contestation of the Director, may pray for an authorisation of non-compliance with that request ... (3) The court shall not grant the authorisation of non-compliance mentioned in the last preceding sub-section unless the applicant shows to the satisfaction of the court that serious hardship would be caused to him by complying with that request: Provided that the assertion that the requisitionee wishes to take possession of the building for his own use or for the use of any member of his family shall not be considered of itself as a hardship for the purposes of this sub-article.” 23. According to the Housing Act, the owner of the premises has a right to compensation, which is calculated and payable pursuant to the criteria established in section 11, which, in so far as relevant, reads as follows: “(1) Subject as hereinafter provided, the compensation payable in respect of the requisition of a building shall be the aggregate of the following sums, that is to say- (a) a sum equal to the rent which might reasonably be expected to be payable by a tenant in occupation of the building during the period for which possession of the building is retained by virtue of the provisions of this Act, under a letting granted immediately before the beginning of that period: Provided that where the building is used by the Director or by a person accommodated therein after its requisition as a dwelling house within the meaning of the Rent Restriction (Dwelling Houses) Ordinance, the rent shall not exceed the fair rent as defined in article 2 of the aforesaid Ordinance; (b) a sum equal to the cost of making good any damage to the building which may have occurred during the period in which possession thereof under requisition was retained (except in so far as the damage has been made good during that period by the occupant of the requisitioned premises or by a person acting on behalf of the Director), no account being taken of damage which, under the provisions of this Act, is the responsibility of the requisitionee; (c) a sum equal to the amount of expenses reasonably incurred, otherwise than on behalf of the Director, for the purpose of compliance with any directions given by or on behalf of the Director in connection with the taking of possession of the building ...” 24. According to Article 2 of the Rent Restriction (Dwelling Houses) Ordinance, “fair rent” means: “i) in respect of an old house, the rent which might reasonably be expected in respect of an old house, regard being had to the average rents prevalent on the 31st March, 1939, as shown on the registers of the Land Valuation Office in respect of comparable dwelling houses in the same or in comparable localities: Provided that where, after the 31st March, 1939, structural alterations or additions in a house, whether old or new, have been carried out which, in the opinion of the Board, have enhanced the rental value of the house and in respect of which or, as the case may be, of a part of which, no compensation has been paid or is payable under the provisions of the War Damage Ordinance 1943, and no amount has been paid or is payable by way of a grant by the Government of Malta, the rent shall be increased by an amount which, in the opinion of the Board, corresponds to the enhancement of the rental value and which shall in no case exceed a return of three and one quarter per centum a year on the capital outlay on the alterations or additions (excluding any interest on loans or in respect of idle capital) or, as the case may be, on the part thereof in respect of which compensation has not been paid and is not payable under the provisions of the War Damage Ordinance 1943, and no amount has been paid or is payable by way of grant by the Government of Malta, in every case as proven by the landlord to the satisfaction of the Board or, in default, as assessed by the Board; and ii) in respect of a new house, a sum equivalent to a return of three per centum a year on the freehold value of the site and of three and one quarter per centum on the capital outlay on construction (excluding any sum which has been paid or is payable by way of a grant by the Government of Malta and any interest on loans or in respect of idle capital) as proven by the landlord to the satisfaction of the Board or, in default, as assessed by the Board: Provided that where a payment under the War Damage Ordinance 1943, is made by or is due from the war damage account in respect of a former building out of which or on the site of which a new house is erected in whole or in part, for the purpose of computing the fair rent of that new house the return on that part of the capital outlay thus contributed by or due from the war damage account shall in no case exceed one year's fair rent of the former building as on 31st March,1939, or three and one quarter per centum for one year on that part of the capital outlay, whichever is the less; (iii) in respect of a scheme house, an annual sum to be determined by agreement ...”