Gaffarena loses Old Mint Street appeal, court orders rescission of expropriation

The government had paid €1.65 million in 2015 for the expropriation of Gaffarena’s part-ownership of the Old Mint Street palazzo, purchased for a fraction of the price just weeks earlier

Mark Gaffarena
Mark Gaffarena

The Court of Appeal has confirmed the 2018 judgement rescinding two contracts through which businessman Mark Gaffarena and his wife Josielle had received around €1.65 million through an irregular expropriation of their share of the part-ownership of a Valletta property.

As a result of the contracts, the government had paid €1.65 million in 2015 for the expropriation of Gaffarena’s part-ownership of the Old Mint Street palazzo that he had bought for a fraction of the price just weeks earlier, in a deal denounced as corrupt by the Opposition and which had led to the resignation of parliamentary secretary Michael Falzon.

The original case requesting the cancellation of the contracts had been filed by Joseph Muscat, at the time the Prime Minister, in 2016, after news stories reporting the deal led to public outcry. A final decision, declaring the property transfers to have been concluded illegally, was handed down in March 2018.

The courts had rescinded the expropriation, ruling that the Commissioner for Lands should have compensated each of the owners pro-rata and that the government had “effectively acquired part of the property belonging to all its owners and only paid one owner for it.”

The Gaffarenas had subsequently filed an appeal, a decision in which case was handed down today by judges Giannino Caruana Demajo, Tonio Mallia and Anthony Ellul.

The appeal was rejected, with the court observing that, “it is precisely because a share of every party’s share that the compensation should not have been given in its entirety to the appellants,” said the court, adding that “this is so obvious that it is hard to understand how the appellants can honestly interpret it in any other way, and how they can seriously say that when a divided share is acquired, the compensation is divided between everyone and when an undivided share is acquired the compensation is not divided.”

The fact that Joseph Muscat had filed the cases as an MP using his official title of Prime Minister did not mean that the case had been filed in the name of the government, said the judges, pointing out that the law gave the right to file such a case only to the Attorney General and members of Parliament. Therefore the conflict in Muscat’s role as plaintiff, as alleged by the Gaffarenas, did not subsist, said the court.

The only changes made by the court to the original judgement were related to the costs of the original case, in that the Gaffarenas were no longer expected to pay the costs relating to the intervenors in the lawsuit.

The court ordered that the period for the publication of the contract of rescission start from today.

READ MORE: Controversial Gaffarena land deals were all rescinded by law courts in 2018