Lack of signature of one spouse does not annul an agreement

This was decided by Mr Justice Anthony Ellul on 18 May, 2015 in Kelly Yilmaz -v- Hasan Yilmaz, Carmel sive Charlot Pisani and Colleen Pisani.

The plaintiff, Kelly Yilmaz, in her application to the court of 31 January, 2014 held that she has been married to the defendant Hasan Yilmaz since 2006. On 18 March, 2011, her husband signed a lease agreement where he rented a shop in Birkirkara for 14 years from the other defendants Pisani. The plaintiff explained that she never gave her consent for her husband to sign and in fact he signed on his own. She claimed that according to Article 1326 of the Civil Code, she had to sign this agreement and therefore, asked the court to declare that her signature was needed and that this fell under the requisites of Article 1326. She also asked the Court to declare that the lease agreement was invalid and not enforceable.

The Pisanis pleaded that the plaintiff was well aware of what was going on and that the lease agreement was still valid at law.

The Court pointed out that according to Article 322(g) of the Civil Code, a lease of immoveable property is an act of extraordinary administration of the community of acquests and as such required the signature of both parties. Article 1326(1) of the Civil Code states: 

“(1) Acts which require the consent of both spouses but which are performed by one spouse without the consent of the other spouse may be annulled at the request of the latter spouse where such acts relate to the alienation or constitution of a real or personal right over immovable property; and where such acts relate to movable property they may only be annulled where the rights over them have been conferred by gratuitous title.”

According to Article 1326(2) the action has to take place within three years when the spouse is aware of the act. Evidence showed that the plaintiff was aware of this sublease a short time after it was signed. Since the lease was signed in March 2011 and the action was instituted in January 2014, these three years elapsed. Then Article 1326(3) of the Civil Code states:

(3) Notwithstanding the provisions of subarticle (2), the right given by subarticle (1) to a spouse to request the annulment of an act shall lapse at the expiration of three months from the day on which notice of the act shall have been given to such spouse by means of a judicial act, unless within such time of three months such spouse shall have instituted an action for such annulment.”

In this case there is no evidence to show that the agreement was notified to the plaintiff by means of judicial act and therefore, it is not sufficient to prove that she knew of this agreement. 

The court held that the action under Article 1326 may be made when one spouse transfers a real or personal right of an immoveable property of the community of acquests. According to Article 1329 of the Civil Code, a debt may be incurred by one of the spouses without the signature of the other, however, this debt would not form part of the community of acquests. 

From the evidence produced the plaintiff had explained to the court that she did not seek legal advice immediately because she was under the impression that nothing could be done. The Court believed that the husband had shown the agreement to his wife shortly after it was signed, but the fact remains that she was not a signatory to the agreement.

The Court quoted Maria Stella Farrugia -v- HSBC Bank Malta plc, decided on 1 February, 2008, which dealt with a personal guarantee that did not have the wife’s consent, which held that the personal guarantee was not null, but it does not impinge on the assets of the community of acquests. If a spouse signed a document that requires the consent of the other spouse then those obligations binds one spouse but not the other.

Spouses are not excluded from entering into personal obligations, since they still retain their independent judicial personality. In fact Article 1328 distinguishes between parafernal debts and those of the community of acquests. In this case, although it was shown that the plaintiff did help occasionally in the shop, it does not mean that she assumed the obligations found in the agreement of 18 March, 2011. 

The Court did not uphold the plaintiff’s requests however, held that the obligations of the 2011 agreement, such as the rent, are not debts of the community of acquests.

Malcolm Mifsud, Partner, Mifsud & Mifsud Advocates