Shortfalls in appraisement of property do not result in the suspension of a judicial sale by auction

The said provision of the law states that in the valuation of immovable property the experts shall include a description of the property stating the burdens, leases and other rights whether real or personal, if any, to which the property is subject, as well as the last transfer of such property.

This was decided by the First Hall Civil Court as presided by Honourable Judge Jacqueline Padovani Grima in its judgement dated the 30th July 2018 in the names of Bank of Valletta p.l.c. v Pauline Bugeja.

On the 11th July 2018 Pauline Bugeja filed an application before the First Hall Civil Court where she requested the Court to suspend the proceedings of a Judicial Sale by Auction related to the sale of her property, since the architect’s valuation as redacted in his Report and which was presented in the acts of the said Judicial Sale by Auction, did not meet the requirements set out under Article 310 (1) of the Code of Organisation and Civil Procedure.

The said provision of the law states that in the valuation of immovable property the experts shall include a description of the property stating the burdens, leases and other rights whether real or personal, if any, to which the property is subject, as well as the last transfer of such property.

The said description must include (a) an indication of the area and height of the property subject to judicial sale; (b) a plan or a sketch which shows the number of rooms constituting the property and their size; (c) a report as to whether the property is built in line with building permits and sanitary rules; (d) a copy of the deed of acquisition; and (e) a declaration as to whether the place is inhabited or occupied by third parties, and under which title it is so occupied.

In her application, Pauline Bugeja contended that the valuation report in this case did not list the burdens that the property that was being sold by means of this judicial sale by auction was subjected to, did not mention the last transfer of the property and did not include the report confirming whether the property had been built in accordance with building permits and sanitary regulations.

Moreover it was claimed that the report did not include the deed of acquisition and it erroneously stated that the owners of the property were William and Pauline spouses Bugeja, but the property was exclusively owned by Pauline Bugeja.

Bank of Valletta p.l.c. in their reply held that as per article 308 (4) of the Code of Organisation and Civil Procedure the architect’s valuation report could not be attacked but an application could be filed requesting that the said appraisement is amended.

Moreover Bank of Valletta p.l.c. held that in actual fact the valuation report did make reference to the necessary building permits and although the burdens and the last transfer were not included in the appraisement they had been duly indicated in the application of the Judicial Sale by Auction and a deed of acquisition was also presented together with the said application and from which deed resulted the title of ownership of the property.

Whilst considering the facts of the case, the Honourable First Hall Civil Court found that the appraisement prepared by the architect did, in fact, lack the documents that Pauline Bugeja had mentioned in her application and erroneously indicated that the property belonged to spouses Bugeja rather than being solely owned by Pauline Bugeja.

With regards to the building permit, the Court held that although the expert had mentioned that the property could not be further developed since it had already been over-developed, there was no indication as to whether the tenement was indeed covered with the necessary building permit.

The Court further held that although the deed of acquisition had been annexed to the application of the Judicial Sale by Auction, the law as per its provisions in Article 310 of the Code of Organisation and Civil Procedure still requires the deed to be attached to the appraisement prepared by the architect.

Notwithstanding this, the Court upheld Bank of Valletta p.l.c.’s plea that such shortfalls in the appraisement do not bring about the suspension of the proceedings of the Judicial Sale by Auction but only lead to the amendment of the report so that it would include all the information in accordance to law.

In view of this, whilst rejecting Pauline Bugeja’s request to suspend the judicial sale by auction, it ordered the expert that had prepared the report to carry out the necessary amendments as required in terms of Article 310 (1) of the Code of Organisation and Civil Procedure.

Dr Catherine Mifsud is an associate at Mifsud & Mifsud Advocates

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