Property is deemed to be commercial if complementary to the principal business

The board commented that in this case the discontinued conversion took place 12 years before the applicants filed their action in court

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Malcolm Mifsud
15 July 2016, 7:34am
The Rent Regulation Board presided by Magistrate Monica Vella held that a property which is complementary to the principal place of business cannot be deemed to be not in use. This was decided on 16 June, 2016 in Adelaide Ellul et -v- Alfred and Josephine Cassar.

The applicants had asked the court to take back in possession a property in Marsa, since it was not being used as an insurance agency.

The defendants reacted by filing a statement of defence, stating that the property in question was never used as an insurance agency, but is used as a workshop, and opened regularly.

The board noticed that in the application, this had mentioned erroneously that the defendants held the shop. Another error was that the property was never used as an insurance agency. A witness from the Malta Financial Services Authority testified that the Authority did not issue a licence for the property to be used as an insurance agency. It is true that an application was made before MEPA, but it is not conclusive evidence that the property was ever used as an insurance agency. Furthermore, the evidence showed that the property was being used as an engineering workshop. As such this is not a simple shop where products are sold.

Magistrate Vella held that if one were to consult a dictionary and look up the word shop, it is described as a place where products are sold and bought. The definition of workshop in a dictionary is where products are made and fixed. Therefore, there is a difference between the two and the aims for renting the premises is different. What applies to a shop, does not necessarily apply to a workshop. 

The board pointed out that the principle of non-use of a premises must result from the evidence produced and therefore it was bound to analyse the evidence. The opening hours of a workshop may be different from those of a shop. In this particular case the workshop complements another shop that the defendants run, which is a minute’s walk away.

The premises are used for repairs and therefore, cannot be open regularly. The board commented that this version is credible. Furthermore, the property was used as a workshop/store from the beginning of the lease, 37 years ago. Around 14 years ago the defendants asked the applicants if they could convert the premises into an insurance agency. They carried out the works to convert the building into an office, but the defendants stopped and continued to use the same premises as a workshop. The board commented that this took place 12 years before the applicants filed their action in court. This meant that for 10 years they had accepted the situation and did not take any action. 

Malcolm Mifsud, Partner, Mifsud & Mifsud Advocates

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Malcolm Mifsud is a partner at Mifsud & Associates.