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FOURTH
SECTION
CASE OF FLERI SOLER AND CAMILLERI v. MALTA
(Application
no. 35349/05)
JUDGMENT
(Just
satisfaction)
STRASBOURG
17
July 2008
This
judgment will become final in the circumstances set out in Article 44
§ 2 of the Convention. It may be subject to editorial
revision.
In the case of Fleri Soler and Camilleri v. Malta,
The
European Court of Human Rights (Fourth Section), sitting as a Chamber
composed of:
Nicolas
Bratza, President
Lech
Garlicki,
Giovanni
Bonello,
Ljiljana
Mijović,
David
Thór Björgvinsson,
Ján
Šikuta,
Päivi
Hirvelä,
judges,
and Lawrence Early, Section
Registrar,
Having
deliberated in private on 26 June 2008,
Delivers
the following judgment, which was adopted on that date:
PROCEDURE
- The
case originated in an application (no. 35349/05) against the Republic
of Malta lodged with the Court under Article 34 of the Convention for
the Protection of Human Rights and Fundamental Freedoms (“the
Convention”) by two Maltese nationals, Mrs Anna Fleri Soler and
Mr Herbert Camilleri (“the applicants”), on 10
September 2005.
- In
a judgment delivered on 26 September 2006 (“the principal
judgment”), the Court held that there had been a violation of
Article 1 of Protocol No. 1 as regards a requisition order which had
been imposed on the applicants for almost sixty-five years and which
created a landlord-tenant relationship under which they received only
a small amount of rent and a minimal profit, so that they had to bear
a disproportionate and excessive burden (see Fleri Soler and
Camilleri v. Malta, no. 35349/05, § 78, ECHR 2006-).
- Under
Article 41 of the Convention the applicant claimed just satisfaction
of MTL 36,378 (approximately EUR 87,307).
- Since
the question of the application of Article 41 of the Convention was
not ready for decision as regards pecuniary damage, the Court
reserved it and invited the Government and the applicant to submit,
within six months from the date on which the judgment became final,
their written observations on that issue and, in particular, to
notify the Court of any agreement they might reach (ibid., §
84, and point 3 of the operative provisions).
- The
applicant and the Government each filed observations on 8 June 2007
and 26 June 2007 respectively.
THE LAW
- Article 41 of the Convention provides:
“If the Court finds that there has been a
violation of the Convention or the Protocols thereto, and if the
internal law of the High Contracting Party concerned allows only
partial reparation to be made, the Court shall, if necessary, afford
just satisfaction to the injured party.”
A. Pecuniary damage
1. The parties’ submissions
- The
applicants submitted that they should recover the rent in respect of
the premises from 1995 onwards based on an annual rental value.
- After
the delivery of the principal judgment the applicants requested an
architect’s valuation, which they submitted to the Court.
According to this valuation, dated 30 October 2006 and carried out in
accordance with the measurement rules and the definition of market
value set out in the ‘Chamber of Architects Valuation Standards
2004’, the annual rental value of the premises at issue, with
vacant possession but continuing its existing use, is in the region
of 20,800 Maltese liras (MTL – approximately 48,294 euros
(EUR)). Once vacant possession of the premises was returned to the
applicants, the property was sold at a price of EUR 1,770,323.78, as
evidenced by the deed of transfer. The applicants, having taken into
consideration inflation and the annual rent that was paid by the
Government during this period, submitted that the round figure of MTL
20,000 (approximately EUR 46,645) per annum between 1995 and 2007
(totalling MTL 240,000 - approximately EUR 559,743), would be
equitable.
- The
Government submitted a proposal which in their view provided a fair
and just basis of the computation for compensation, due account being
taken of the relevant social and economic aspects of the matter at
issue.
- The
Government submitted that the market value in Malta could not form
the basis of the computation for compensation. Social and economic
factors related to the social function of the property necessarily
had to be taken into account. Moreover, property markets were also
influenced by factors such as the sale of property to foreigners and
the phenomenon of purchase of property purely for investment or
speculation purposes, which did not attach importance to the social
functions of the property.
- The
Government proposed reconsideration of the rent according to the
index of inflation (“I.I”) over the years and a
subsequent increase every fifteen years in accordance with the I.I.,
without applying any cap to the increase in rent, such as that
applicable to dwelling houses, in view of the fact that the premises
were used as Government offices and not for the purposes of social
housing.
- The
index of inflation started to be calculated in Malta in 1946. The
Convention came into force in respect of Malta on 23 January 1967.
The rent payable for the premises at the time amounted according to
law (the Housing Act and the Reletting of Urban Property Ordinance)
to MTL 89 (approximately EUR 207). The rate of inflation between 1946
and 1967 (during which period the I.I rose by 75.65 points) would
translate into an increase in rent amounting to MTL 156.33
(approximately EUR 364) annually. A revision of that rent according
to the I.I in 1982, fifteen years later (during which period the I.I
rose by 232.51 points) would increase the rent to MTL 519.81
(approximately EUR 1,212). The increase to cover the subsequent
fifteen years 1982-1997 (during which period the I.I rose by 136.12
points) would increase the rent to MTL 1,227.38 (approximately, EUR
2,860). The increase for the next fifteen years would be available
only in 2012.
-
The amount of rent already paid by the Government to the applicants
between 1967 and 1987 (MTL 89 per year) and between 1988 and 2007
(MTL 340.53 per year) should be deducted from the above sum.
- Thus,
according to the Government the balance to be paid to the applicant
was MTL 13,825.30 (approximately EUR 32,204).
2. The Court’s assessment
- The
Court recalls that in its principal judgment it held that there had
been a violation of Article 1 of Protocol No. 1 with regard to the
requisition order imposed on the applicants for almost sixty-five
years, which created a landlord-tenant relationship under which they
received only a small amount of rent and a minimal profit, so that
they had to bear a disproportionate and excessive burden (see Fleri
Soler and Camilleri v. Malta, cited above, § 78).
- The
applicants did not seek compensation for the period between 1967
(date when the Convention came into force in respect of Malta) and
1994. Hence, the Court will proceed to determine solely the
compensation to which the applicants are entitled in respect of the
loss of control, use and enjoyment of the property which they
suffered from 1995 to 2007, when the Government released the property
at issue.
- The
Court observes that there is a considerable discrepancy between the
applicants’ claims and the amount offered by the Government.
According to the Court’s own calculation based on the
Government’s reasoning, the balance, and therefore, the sum
offered by the Government for pecuniary damage is incorrect. The
Court is of the view that the applicants’ submissions can be
reasonably considered to reflect an acceptable valuation of the
rental value on the market over the years. The Government’s
proposal, on the other hand, reflects a purely token sum which does
not seem to take account of the factual reality, namely the size of
the building and its prime location.
- The
Court is of the view that the applicants should be awarded just
satisfaction based on a reasonable amount of rent which would have
provided them with more than a minimal profit (see paragraph 15
above). In assessing the pecuniary damage sustained by the
applicants, the Court, as far as appropriate, considered the
estimates provided and had regard to the information available to it
on rental values on the Maltese property market over the years. It
further considered the legitimate purpose of the restriction
suffered, namely the allocation of the applicants’ property to
Government departments which performed duties in the interests of the
community as a whole. Nonetheless, it kept in mind that the property
was not used for securing the social welfare of tenants or preventing
homelessness.
- The
Court, making its assessment on an equitable basis, awards the
applicants the sum of EUR 279,525.
B. Non-pecuniary damage
- In
their claims for just satisfaction made before the adoption of the
principal judgment, the applicants alleged that they had suffered
great hardship. They requested the Court to fix the amount of
compensation for non-pecuniary damage on an equitable basis. They
made no further requests in their complementary observations after
the principal judgment.
- The
Government considered that the applicants had not sustained
non-pecuniary damage. However, as a goodwill gesture they were
willing to pay the applicant MTL 3,500 (approximately 8,150 EUR),
which would cover the sum paid by the applicants in ground rent from
1941 to 2007.
- The
Court considers that the events in question entailed serious
interference with the applicants’ right to the peaceful
enjoyment of their possessions, in respect of which the sum offered
by the Government represents fair compensation for the non-pecuniary
damage sustained. It therefore awards EUR 8,150 in respect of
non-pecuniary damage.
C. Default interest
- The
Court considers it appropriate that the default interest should be
based on the marginal lending rate of the European Central Bank, to
which should be added three percentage points.
FOR THESE REASONS, THE COURT UNANIMOUSLY
- Holds
(a) that the respondent State is to pay the applicant,
within three months from the date on which the judgment becomes final
in accordance with Article 44 § 2 of the
Convention the following amounts:
(i) EUR
279,525 (two hundred and seventy-nine thousand five hundred and
twenty-five euros) in respect of pecuniary damage;
(ii) EUR
8,150 (eight thousand one hundred and fifty euros),
plus any tax that may be chargeable, in respect of
non-pecuniary damage;
(b) that from the expiry of the above-mentioned three
months until settlement simple interest shall be payable on the above
amounts at a rate equal to the marginal lending rate of the European
Central Bank during the default period plus three percentage points;
- Dismisses the remainder of the applicants’
claim for just satisfaction.
Done in English, and notified in writing on 17 July 2008, pursuant to
Rule 77 §§ 2 and 3 of the Rules of Court.
Lawrence Early Nicolas Bratza
Registrar President
