Court must assure that all co-owners receive a fair price in forced sale of property

When the majority of co-owners request the sale of the property, the Court has to see whether the sale will cause serious prejudice to the minority. This was held in a judgment delivered by Magistrate Simone Grech presiding over the Magistrates’ Court in Gozo in its superior jurisdiction. The case is Mary sive Miriam Borg vs Carmel Pace noe, decided on 20 December 2024.

In their application, the Applicants explained that they entered into a promise of sale agreement in November 2022 to sell land in Rabat, Gozo. All the sellers were in agreement to sell the property, however, one of the sellers, Lawrence Pace suffers from a medical condition that prohibits him from giving a power of attorney.

He has one third of one sixteenth of the property. The applicants believe that the selling price is a just one and asked that the court in fact declare that the price is just and so are the conditions. They asked the court authorise the sale of the property.

Carmel Pace did reply to the case by saying that he did not oppose the sale of the property. The case became necessary because he was appointed a curator of Lawrence Pace, but the Court of Voluntary Jurisdiction rejected a request for him to sign in Lawrence Pace’s stead.

The Court held that the application article of law is Article 495A of the Civil Code, which allows the Court of authorise the sale of a property when the majority of the co-owners want to sell the property and the minority refuse the sell the property capriciously.

The Court quoted from another judgment Aloysius Farrugia et vs Dr Josette Sultana et noe decided on 31 May 2017 by the First Hall of the Civil Court. The Court held that the 10-year period mentioned in this article of law starts from when the co-ownership starts. Article 495A(5) allows the dissenting co-owners to object to the sale of the property by proving that the sale will cause grave prejudice. If the sale goes through, all the co-owners must receive a fair price. Sub-article 3 provides for appointing a curator.

In another judgment David Abela noe vs Dr Simon Micallef Stafrace noe decided on 30 June 2011 by the First Hall of the Civil Court, held that this article allows for a forced sale, but parameters are placed in order to avoid any abuse.

The Court in this case held that it went through the documents it received including the extensions of the promise of sale agreements and the root of tile. The Defendant had given his consent for the property to be sold. The selling price according to the promise of sale agreement is €287,500. The applicant’s architect’s report valued the property at €290,000 in 2022. In fact, it was declared that the Applicants were prepared to acquire the Defendant’s share on the basis of the €290,000 valuation. The other conditions of the promise of sale were standard conditions.

The Court then moved to uphold the Applicant’s request and ordered that the Defendant receive €16,111 as Lawrence Pace’s share. Therefore, the Court ordered that the sale take place and also appointed a curator in case the Defendant does not appear for the final contract and orders that she deposit the share of the price in court.