Justice is not kind to landlord who under-declared to taxman

A judge has rejected a landowner’s €400,000 compensation claim, made in a human rights case he filed over a fixed €51.51 annual rural lease which the law prohibited him from increasing, pointing out that the quoted law itself also allowed the parties to enter into agreements which would neutralise the problem. 

But in a stinging judgement handed down by Mr Justice Toni Abela on Thursday, the judge also lashed out at the plaintiff for having evidently under-declared the property’s value to the taxman, whilst at the same time expecting the court to award a much higher sum in compensation. 

The plaintiff had declared the value of the land to be just €95,000 upon inheriting it in 2021. A court appointed expert had subsequently valued the land in question at €330,000. 

“It is said without hesitation, that in cases of this nature, the Court feels obliged to rely on the amounts declared in the causa mortis declaration and without this Court having to explain much as to why it feels this way, as it is evident to whoever has a modicum of intelligence. 

“In such cases, the plaintiffs cannot expect to only take what they want where it suits them, when for the purposes of paying tax they declare one value, whilst in cases like this, they expect much more generous valuations.” 

The judge reminded that the amounts disbursed in compensation awarded by the courts were ultimately paid for by the taxpayer. “While it is true that the problems created by these laws which were never updated throughout the years, are to be answered for by the State, at the end of the day, it is the citizens of Malta who are indirectly making good for these shortcomings.” 

The case in question had been filed by Gerolamo Bonavia on behalf of his brother Paul, over the lease of a 7,493 square metre field at Tal-Barrani in Zejtun. The field originally belonged to Bonavia’s aunt, who passed away in 2019, leaving it to the plaintiff in her will. 

The field had been leased for many years to Anthony Zammit for an annual €51.51 rent, payable every August in arrears, but at one point, Bonavia had refused to accept the rent. 

Bonavia argued that under the Agricultural Leases (Reletting) Act, the price of this rural lease could not be increased, and that he could only take back possession of such a field under several restrictive conditions. 

If even one of these conditions is not met, the lease is automatically renewed and the owner is “forced to accept the indefinite prorogation of the lease, against his will,” the plaintiff argued. 

The landowner claimed that the absence of a legal remedy to this situation had led to him suffering a breach of his fundamental right to the enjoyment of his property. 

The State Advocate countered these arguments, telling the court that Bonavia should not be allowed to claim that he had suffered a breach of his rights during the years before he inherited the field. Such a claim could only be raised by the aunt’s universal heir, argued the State, and not a simple legatee, as Bonavia was later found to be. 

Any compensation awarded should reflect the fact that the plaintiff only became the sole owner of the land in February 2021, having shared the ownership with his seven siblings in the years before that. 

In his decision on this case, the judge observed that no receipt book indicating the payment of the lease had been exhibited and neither was there a clear start date, “besides a very misty indication.” 

Zammit had told the court that he had taken over the lease when he was 20 years old, but it was noted that he never provided a specific start date for the lease, nor evidence of his current age. 

The judge also noted that the plaintiff’s complaint did not fall within the parameters of the articles of the law he quoted, stressing that there was a distinction between the principles regarding the right to a fair hearing and those regarding the absence of an adequate legal remedy and quoting jurisprudence which supported this distinction. 

Mr Justice Abela ruled that what the court was required to do in this case was to establish whether the applicable articles of the Agricultural Leases (Reletting) Act constituted interference with the plaintiff’s rights and whether it allowed for a balance to be struck between the competing interests of the parties. 

The Act maintained a balance between the general interest and that of the owner, preventing the owner from easily taking back possession from the tenant but at the same time, also ensuring that he had a means of receiving fitting compensation for this. 

The tenant could at any time request the Agricultural Leases Board to establish the amount of lease which was fitting in the particular circumstances of the case, said the court. 

“In this case, there is no decision by the Board in respect of the applicant. This is because the same applicant never sought recourse before it as provided by the law.” 

Judge Abela highlighted that there were legal reservations built into this law which while often overlooked were of great importance. “These reservations state that if there is a written agreement between the parties, as a consequence the effects of this law could be neutralised.” 

For these reasons, the court upheld the submissions made by the State Advocate and dismissed Bonavia’s claim.