Constitutional Court confirms unjust nature of band club rental laws, raises compensation sums

The provisions of Article 1531J that stipulate that the laws regulating the rent of band clubs will remain subject to perpetual renewal under Chapter 69 of the Laws of Malta may bring about breaches of the fundamental right to the enjoyment of personal property as guaranteed by the European Convention on Human Rights.

This was confirmed by the Constitutional Court in relation to human rights breaches to the right to the enjoyment of property in the case of Evelyn Montebello et. vs The Attorney General and Maria Mater Gratiae Philarmonic Society on the 13th of July 2018. This case was an appeal by the defendants who held that the decision taken by both the First Hall Civil Court as well as the Court of Appeal contained deficiencies both on the consideration of merits and procedure.

The Court reviewed the facts of the case as originally presented by the plaintiffs who are the owners of a property in Zabbar which was leased in 1926 to the defendants who are a philharmonic society whose band club has engaged in locality events and feasts for more than a century. The plaintiffs, however, argued that due to the emergency rent laws that were enacted during the 20th century, in order to protect tenants of urban properties during the times when housing was scarce post-World War II, they were unable to take back possession of their property. Chapter 69 of the Laws of Malta was enacted in 1931, and granted a right for the extension of a lease after the period stipulated by the contract had extinguished. The rent would have to be extended under the same conditions as the previous tenancy agreement, meaning that rental costs imposed by the landlord could not be raised.

The plaintiffs held that this meant that for a period of around 90 years the landlords of the property could not impose rent higher than the yearly sum of €279.52. They held that this was a grave violation of their fundamental human rights. Both the first and appellate Courts concluded that the application of the laws in Chapter 69 in this case led to a breach of human rights and thus could no longer have effect. They also awarded both pecuniary and non-pecuniary damages, in the sums of €180,000 and €10,000 respectively.

The Constitutional Court heard the appeal lodged by the Attorney General who had four grounds of appeal that the appellate Court should consider. The first regarded the fact that the situation the plaintiffs were in was self-imposed because they chose to rent the property at a time when the laws contemplated such measures. The Court did not entertain this claim, stating that on the contrary, the laws imposed such conditions on the owners of the property who rented the property prior to Chapter 69 being enacted. The Court also denied the second ground of appeal by the defendants who held that the breach of the fundamental human right to the enjoyment of property, as guaranteed by Article 1 of the first Protocol to the Convention, made an exception for when the aim of the Government was to protect a legitimate social interest. It was, however, concluded by the Court that although the band club constituted an important part of the social and cultural local traditions, the breach had occurred because depriving the owners of the property for so many years with a very low rent was not a proportionate action.

The third ground of appeal, was confirmed by the Constitutional Court and was with regards to the order by the first Court ordering the tenants of the property to immediately vacate the property. The Court agreed with the Attorney General that such a decision required factual checks and certain information which only a competent tribunal would be able to affect. This decision was therefore reversed and the Court concluded that the fact that the laws of Chapter 69 would no longer apply to the rental of the property was enough to remedy the situation.

Finally, the Court addressed the ground of appeal of  the Attorney General on the improper quantification of damages. The Court concluded that due to the long-standing denial of their rights, the plaintiffs, in fact, deserved a higher amount of compensation for pecuniary damages. It was ordered that €200,000 should be paid as compensatory damages to the owners of the property and that moral damages should remain at the amount of €10,000. The Court was preceded by the Chief Justice Hon. Joseph Azzopardi, Hon. Judge Giannino Caruana Demajo and Hon. Judge Noel Cuschieri.