Couple wins €374,000 from rogue developer who sold them land he did not own

A 13-year long saga is nearing its end, after the Maltese courts ordered a developer to pay back over €374,000 to the young couple who bought a maisonette on land that was not even the developer’s to sell.

Elton and Cheryll Penza acquired their Tal-Ibragg maisonette overlooking the Mejxu valley, for Lm35,000 in 2002 – only to realise that the land it was built on was government-owned and did not belong to them.

The family was thrown in disarray at news that, less than a year after acquiring their house, it turned out that the formerly Church-owned land had been transferred to the government.

Years in court and extensive research on land titles would however reveal how the uncertain provenance of the land was kept hidden from the buyers: a land transfer whose dubiousness was pointed out by Mr Justice Mark Chetcuti.

First libels, then the truth

When MaltaToday first reported the case, it had already revealed a previous case of collusion in 2004 between Gozitan businessman Domenico Savio Spiteri, of Spiteri Holdings, and Raymond Aquilina of Terra Mediterranea – the latter company being the seller of the land to the Penza couple. The two companies had been accused of having trespassed on the land in the area known as Ta’ Giakondu, in the Swieqi-Madliena area, in a civil case filed by the landowner, the marquis Marcus Marshall.

When MaltaToday reported both this and the Penza case, Spiteri and Aquilina filed five libel suits against the newspaper. By 2006, the two men themselves had fallen out, with Spiteri demanding that Aquilina vacates land he owned, for not having paid him in full.

But the tragedy of the story in 2004 was the fact that the Penza couple were then facing eviction from their own home. “We cannot see how or where we got it wrong,” they had told MaltaToday back then. “But wrong it is as towards the end of last year we were given the fright of our lives when we were officially informed by the Lands Department that the maisonette we ‘purchased’ from Terra Mediterranea was built upon Government land and that therefore ‘our’ maisonette was ours no longer but was the property of the Government of Malta.”

It was through Spiteri Holdings that Aquilina, of Terra Mediterranean, had acquired the land at Triq Wied Mejxu, which he later developed and then sold to the Penza couple.

In court, the evidence presented by the Penza couple confirmed reports first published in MaltaToday.

No ‘peaceful possession’

Originally, the land in question had been transferred as part of the 1992 Church-State agreement to the Joint Office, which administers the lands transferred from the Church to government. But the land itself was only finally registered – a process through which the Joint Office finally registers the Church land as government property – in 2003.

Terra Mediterranea, which sold the maisonette to the Penzas, however insisted that the land had been acquired from Spiteri Holdings in 2002, and that its ownership originally came from Spiteri’s acquisition of the 1826 inheritance of the priest Paolo Xuereb.

This inheritance, bequeathed to the Balzan parish church to administer it, was the source of much trouble for the Penzas.

In 1995, the priest Renato Valente – a former rector of Mount Carmel College and the principal of an English-language school in Kappara – was appointed as the testamentary executor of the Xuereb will, replacing the sickly Fr Rafel Gauci, who had been entrusted with executing the will.

The sale of the inheritance to Spiteri Holdings had to be first be cleared by a court of law, especially since the lands in question had been left abandoned and an inventory of assets was also missing.

Fr Valente himself told the court that Domenico Savio Spiteri was aware of the problems concerning the disputed land, and that Spiteri was ready to absolve the seller of the guarantee of “peaceful possession” – a requirement guaranteeing the land being sold is not contested by other third parties.

On 10 July 1996, Valente told the court he only had a “simple indication” of where the lands mentioned in the will were, through an attached map of the area that was included with the will.

But he also declared that he had “no documents as to whether there was a legal title on these lands”, and that Spiteri had insisted he would exempt him from any legal obligations should he find no legal title.

Valente also presented a draft contract to the court, indicating that the sale of land would be exempted from the guarantee of peaceful possession.

The court-appointed architect, Rene Buttigieg, basing himself on the dated map attached to the will, valued the lands at Lm7,000 (€16,310).

When the court authorised the sale on 2 August 1996, three days later the transfer of the land took place, in a deed signed by notary Anthony Abela – today a Nationalist MP.

Notarial contract contradicts court decree

But Mr Justice Chetcuti noted that, in reading the 1996 contract, “it [was] evident that the qualifications putting in doubt the origins and consistency of the inheritance’s assets, which were indeed written down in a draft contract presented to the court, were not included. Additionally, the guarantee of peaceful possession, which had been expressly excluded from the draft contract, was included in the sale contract.”

Chetcuti added: “The court cannot but point out the discrepancies resulting from the transfer from the testamentary executor to Spiteri Holdings. The executor himself had no clear clue what the Xuereb inheritance consisted of. But Spiteri Holdings had an interest to buy in full knowledge that he had no guarantee what the inheritance’s assets were.

“The plan presented by the executor does not even show the land registered in favour of the State, but another piece of land. Inexplicably, and despite a court decree saying the land had to be sold without guarantee of peaceful possession, the contract of acquisition by Spiteri Holdings was manifestly in contradiction to the court order.”

Indeed, a court expert showed how the lands indicated in the Xuereb will’s plan were fields in Swieqi known as ‘Ta’ Maima’ or ‘Ta’ Misrah Giuna’: almost a kilometre away from the ‘Ta’ Giakondu’ fields that Spiteri Holdings had sold.

Additionally, in 1912 the Maltese courts already had to examine the alleged assets bequeathed in the Xuereb inheritance, a process fraught with uncertainty as the court-appointed expert of the time, Edmondo Rizzo, was unable to find an inventory of the assets.

While mention was made of land “in the vicinity of St George’s Bay, known as Ta’ Swieqi consisting of…”, the continuation of that description is rudely interrupted by a missing page.

“The fact that Spiteri Holdings acquired an inheritance without a clear proof of the origin of the land in question, does not mean it had a title to the land,” the present court noted.

In its decision, the court ordered the rescission of the contract of sale between Terra Mediterranea and the Penza couple for having misled the buyers.

The court found no proof of collusion between Terra Mediterranea and Spiteri Holdings, but Mr Justice Chetcuti said the same could not be said of Domenico Savio Spiteri in his acquisition of the inheritance from the late Renato Valente.

“Once that contract carried the guarantee of peaceful possession, Terra Mediterranea also acquired that land with that guarantee… no proof was brought of the bad faith implicit in this contract by the plaintiffs.” 

The case is now being appealed by Terra Mediterranea.

Timeline of deceit

May 1996 Fr Renato Valente is appointed testamentary executor by a court, replacing Fr Rafel Gauci, to execute the sale of assets in the 1826 inheritance passed on from siblings Paolo and Tereza Xuereb. 

July 1996 Valente says Gozitan buyer Domenico Savio Spiteri, director of Spiteri Holdings Ltd, will buy the inheritance and exempt him from the guarantee of peaceful possession because he is not aware of the contents of the inheritance.

August 1996 Court expert Architect Rene Buttigieg, basing himself solely on the plan attached to the will, says the two plots of land, each measuring 31 sq.m. at the end of Tal-Franciz Road, Swieqi, are valued at Lm7,000. When Spiteri Holdings signs the contract of acquisition, the deed of purchase does not list the contents of the inheritance, and does not refer to the exemption of peaceful possession ordered by the court.

2002 Spiteri Holdings sells the land at Triq Wied Mejxu – part of the land formerly known as Ta’ Giakondu – located 775 metres away from the Swieqi land indicated in the Xuereb inheritance’s plan. The deed of sale to Terra Mediterranea claims the land originates from the Xuereb inheritance, published by Notary Anthony Abela on the 5 August 1996. Less than ten days after purchasing the land from Spiteri, Terra Mediterranea sells apartments it had already built on the plots, to private individuals. It is evident that Terra Mediterranea had built the flats on the plots before it officially and legally ‘purchased’ the land from Spiteri Holdings.

September 2003 Correspondence from the Joint Office confirms the Wied Mejxu land was transferred to the State in 2003, as part of the 1992 Church-State agreement. The Lands Department takes legal action against Raymond Aquilina, director of Terra Mediterranea and informs homeowners they are standing on land owned by the government. It is now apparent that notaries appointed by the Wied Mejxu residents had not conducted appropriate searches to confirm the legitimacy of the sale of land.

May 2004 The residents take legal action against Terra Mediterranea.

June 2004 In its reports, MaltaToday reports that Terra Mediterranea had been previously found guilty of trespassing land at Tal-Franciz, owned by the Marquis Marcus Marshall. The court proceedings reveal that Spiteri Holdings had directed the Terra Mediterranea to start works on the land. Again Domenico Savio Spiteri, in his evidence, claims he acquired the land through an inheritance. It is clearly proven in Court that the land had been property of the noble Testeferrata and Scicluna families for hundreds of years.