European Court of Human Rights

SECOND SECTION

CASE OF MARTINELLI AND OTHERS v. MALTA

(Application no. 788/21)

JUDGMENT
 

STRASBOURG

14 November 2023

This judgment is final but it may be subject to editorial revision.

In the case of Martinelli and Others v. Malta,

The European Court of Human Rights (Second Section), sitting as a Committee composed of:

 Jovan Ilievski, President,
 Lorraine Schembri Orland,
 Diana Sârcu, judges,
and Dorothee von Arnim, Deputy Section Registrar,

Having regard to:

the application (no. 788/21) 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") on 22 December 2020 by 10 Maltese nationals, relevant details listed in the appended table ("the applicants"), who were represented originally by Dr K. Micallef, a lawyer practising in Tal-Pietà;

the decision to give notice of the complaints concerning Article 1 of Protocol No. 1 to the Convention alone and in conjunction with Article 13 of the Convention to the Maltese Government ("the Government"), represented by their Co-Agent, Dr J. Vella, Advocate at the Office of the State Advocate, and to declare inadmissible the remainder of the application;

the parties' observations;

Having deliberated in private on 17 October 2023,

Delivers the following judgment, which was adopted on that date:

SUBJECT MATTER OF THE CASE

1.  The case concerns the applicants' property in Naxxar which has since 1945 been rented out, as a club, under Chapter 69 of the Laws of Malta, to the Naxxar Lions Football club. At the time it was rented out at 30 Maltese lira annually (approximately 66 euros (EUR)). Since then, the rent only increased slightly as of 2014, so that by 2019 the annual rent was EUR 108. As of 2015 the owners were also entitled to 5 % on the profits made by the tenants on the economic activity pursued by the club, which in the present case amounted to around EUR 550 per year. By operation of law the lease continued to be extended at very low rents and under the applicable restrictions.

2.  The applicants instituted constitutional redress proceedings complaining of a breach of their property rights. In total the rental value from 1987 to 2019 according to the court-appointed expert would have been EUR 1,125,360 while that actually perceived amounted to approximately EUR 2,450. As a base for the calculations the expert, who was of the view that the property needed proper refurbishment, considered its estimated sale value in 2019 as being EUR 790,000. The expert calculated an annual rental value in that same year at EUR 46,800, based on a yield of 5.9%, which was then worked backwards to calculate the rent every five years until 1987, date when the annual rent was estimated as being EUR 23,640. The applicants relied on those estimates in their arguments.

3.  By a judgment of 25 June 2020, the first-instance court found a violation of Article 1 of Protocol No. 1 to the Convention as the applicants had suffered a disproportionate burden from 1987-2019. Bearing in mind the legitimate aim at issue, which however was not social housing, it awarded the applicants EUR 250,000 in pecuniary damage and EUR 6,000 in non-pecuniary damage. It further considered that the tenant could no longer rely on the impugned law to maintain title to the property. On appeal, solely by the State Advocate, on 23 November 2020 the Constitutional Court confirmed that judgment. It held that 15 % of the appeal costs were to be paid by the applicants.

4.  The applicants instituted eviction proceedings before the Rent Regulation Board (RRB) which delivered judgment ordering the eviction of the tenants on 4 June 2021. The tenants initially failed to comply with the order, but an executive warrant of eviction was finally executed on 31 January 2022 and the applicants regained possession of the property.

5.  The applicants complained under Article 1 of Protocol No. 1 to the Convention alone and in conjunction with Article 13 of the Convention that they were still victims of the upheld violation, the constitutional jurisdictions having failed to award appropriate redress (and no redress for the period from 1967-1986) and evict the tenants.

THE COURT'S ASSESSMENT

1. ALLEGED VIOLATION OF ARTICLE 1 OF PROTOCOL No. 1 TO THE CONVENTION

6.  The applicants complained that they were still victims of the violation of Article 1 of Protocol No. 1 to the Convention upheld by the domestic courts.

7.  The Court refers to its general principles concerning victim status and its established case-law in cases similar to the present one (see, among many other authorities, Apap Bologna v. Malta, no. 46931/12, §§ 41, 43, 48 and 82, 30 August 2016). In the present case, the Court notes that there has been an acknowledgment of the violation by the domestic courts, albeit it was likely not to have covered the period prior to 1987 given the relevant domestic law and practice (see, for example, Edwards v. Malta, no. 17647/04, § 22, 24 October 2006). However, the Court will refer to that period below (see paragraph 16 below). The domestic court further awarded EUR 250,000 in pecuniary damage and EUR 6,000 in non-pecuniary damage.

8.  As to whether appropriate and sufficient redress was granted for the period following 1987, the Court observes that, the valuation relied on by the applicants does not appear to take due and proper account of the conditions in which the property was found on the day of the inspection in 2019, on the sole basis of which the antecedent values were worked out. As indicated by the Government, the report notes various deficiencies in the property. Despite these elements, it nevertheless estimated the market rental value in 2019 at EUR 46,800, based on a yield of 5.9%, on its sale value of EUR 790,000, then working backwards to calculate previous rents. According to the Government, the rental value estimated for the year 2019 could not have been obtained without substantial refurbishment to the property, and the method of calculation also provided unrealistic figures especially for the early years such as 1987. Despite a question on the matter, the applicants made no specific comment on these issues, other than the fact that the report had not been contested at the domestic level and that the Constitutional Court had made no comment on the validity or reliability of the report. In these circumstances, while not questioning the sale valuation, the Court considers that the rental valuation made by the court-appointed expert and unrebutted by the State Attorney during the domestic proceedings was on the high side in view of the fact that the property needed refurbishment. In the Court's view, taking into consideration all relevant matters, inter alia, the commercial use of the property and its location, an award of EUR 250,000 to cover a violation over a period of at least three decades was nevertheless not adequate. This consideration suffices to find that the redress provided by the domestic court did not offer sufficient relief to the applicants, who thus retain victim status for the purposes of this complaint (see, mutatis mutandis, Portanier v. Malta, no. 55747/16, § 24, 27 August 2019). The Government's objection to this effect is therefore dismissed.

9.  The Court also dismisses the Government's objection of non-exhaustion of domestic remedies (in so far as the applicants had not appealed to the Constitutional Court). The Court has already made relevant considerations related to the Constitutional Court's effectiveness for the period until 2018 in Cauchi v. Malta (no. 14013/19, §§ 55 and 77, 25 March 2021) and for the period until 2019 in Pace v. Malta ([Committee], no. 53545/19, § 9, 29 September 2022), and Grima and Others v. Malta ([Committee], no. 18052/20, § 8, 7 March 2023).

10.  The Court notes that the additional domestic judgments relied on by the Government in the present case, related to 2020, show that the Constitutional Court increased compensation in seven[1] of the eight appeals where this was requested. Thus, the Court considers that the case-law relied on by the Government offers a good indication that in 2020 the Constitutional Court abandoned its precedent practice of diminishing compensation awarded at first instance and, as argued by the Government, has started to examine these rent law cases on their own merits, taking into account the facts of each case.

11.  However, the Court observes that the compensation terms applied by the Constitutional Court in March 2020 were nonetheless not consistently satisfactory. For example, on the same day, 27 March 2020, it upheld the plaintiff's appeal and increased compensation in one judgment, thus awarding adequate compensation (see Tabone v. Malta (dec.) [Committee], no. 23107/20, §§ 10-13, 28 March 2023), while upholding the State's appeal and therefore reducing compensation in two other judgments[2], one of which resulting in an inadequate amount of compensation being awarded (see Grima v. Malta [Committee], no. 38660/20, §§ 6 and 9, 22 September 2022). The next case where compensation was increased by the Constitutional Court is dated 20 July 2020[3], that is after the expiry of the time-limit for the applicants in the present case to appeal (i.e., twenty running days from the first-instance judgment of 25 June 2020 in their case). Thus, even assuming that, by 20 July 2020, the final awards made by the Constitutional Court were already in line with this Court's awards (see, for example, Cuschieri and Others v. Malta (dec.) [Committee], no. 36806/21, § 8, 20 September 2022, in relation to the beginning of 2021), and that it could be considered an effective remedy, given the relevant timeline in the circumstances of the present case, the applicants could not have been expected to lodge an appeal to the Constitutional Court prior to that date.

12.  The Court notes that this complaint is not manifestly ill-founded within the meaning of Article 35 § 3 (a) of the Convention or inadmissible on any other grounds. It must therefore be declared admissible.

13.  As to the merits, the Court refers to its general principles as set out and applied in, for example, Bradshaw and Others v. Malta (no. 37121/15, §§ 50-65, 23 October 2018).

14.  Having regard to the findings of the domestic courts relating to Article 1 of Protocol No. 1, the Court considers that it is not necessary to re-examine in detail the merits of the complaint for the period following 1987. It finds that, as established by the domestic courts, the applicants were made to bear a disproportionate burden. Moreover, as the Court has already found in the context of the objection on victim status (see paragraph 8 above), the redress provided by the domestic courts did not offer sufficient relief to the applicants.

15.  The foregoing considerations are sufficient for the Court to find that there has been a violation of Article 1 of Protocol No. 1 to the Convention.

16.  In so far as the applicants also seem to complain under Article 1 of Protocol No. 1 about the period prior to 1987, the Court notes that no estimates were provided for that period; it is therefore not possible to determine whether any disproportionate burden arose prior to 1987. It follows that, even assuming that the complaint is not inadmissible for any other reason, this part of the complaint is unsubstantiated and therefore manifestly ill-founded and must be rejected pursuant to Article 35 §§ 3 (a) and 4 of the Convention.

2. OTHER COMPLAINTS

17.  The applicants also complained under Article 13 of the Convention in conjunction with Article 1 of Protocol No. 1 that they had not had an effective remedy capable of redressing the violation under Article 1 of Protocol No. 1. Having regard to the facts of the case, the submissions of the parties, and its findings above, as well as the development of the Constitutional Court's case-law in 2020, the Court considers that it has dealt with the main legal questions raised by the case and that there is no need to examine the remaining complaint (see Centre for Legal Resources on behalf of Valentin Câmpeanu v. Romania [GC], no. 47848/08, § 156, ECHR 2014).

APPLICATION OF ARTICLE 41 OF THE CONVENTION

18.  While not making a precise claim for pecuniary damage the applicants contended that in order to satisfy the general rule of restitutio in integrum, on the basis of the expert report they ought to have received compensation of not less than 1,122,910 euros (EUR) as well as non-pecuniary damages. The domestic courts having awarded only EUR 256,000, this left a shortfall of EUR 866,910. They then claimed EUR 20,000 in non-pecuniary damage and EUR 7,500 for costs incurred before this Court.

19.  The Government submitted that the applicants' pecuniary claim was not based on the guidelines established in Cauchi (cited above, §§ 102-07), that they had already obtained non-pecuniary damage at the domestic level, and that no evidence had been provided concerning the claim for costs.

20.  Having made all the considerations applicable in this type of cases, as set out in Cauchi (cited above, §§ 102-07), including those made at paragraph 8 above concerning the submitted valuation, and noting, in particular, that the award of the Constitutional Court remains payable if not yet paid, the Court awards the applicants, jointly, EUR 200,000 in pecuniary damage and rejects their claim for non-pecuniary damage which can be considered covered by the domestic award. It also rejects the unsubstantiated claim for costs and expenses before this Court.

FOR THESE REASONS, THE COURT, UNANIMOUSLY,

1. Declares the complaint concerning Article 1 of Protocol No. 1 to the Convention in relation to the period following 1987 admissible, and the remainder of this complaint concerning the antecedent period inadmissible;
2. Holds that there has been a violation of Article 1 of Protocol No. 1 to the Convention for the period following 1987;
3. Holds that there is no need to examine the admissibility and merits of the complaint under Article 13 of the Convention in conjunction with Article 1 of Protocol No. 1 to the Convention;
4. Holds

(a)  that the respondent State is to pay the applicants, jointly, within three months, EUR 200,000 (two hundred thousand euros), in respect of pecuniary damage;

(b)  that from the expiry of the above-mentioned three months until settlement simple interest shall be payable on the above amount at a rate equal to the marginal lending rate of the European Central Bank during the default period plus three percentage points;

5. Dismisses the remainder of the applicants' claim for just satisfaction.

Done in English, and notified in writing on 14 November 2023, pursuant to Rule 77 §§ 2 and 3 of the Rules of Court.

 Dorothee von Arnim Jovan Ilievski
 Deputy Registrar President

APPENDIX

List of applicants:

[1] Victoria Amato Gauci et v. L-Avukat Generali et, Rik. 85/2013, 28 February 2020;

Catherine Tabone pro et noe v. L-Avukat Generali et, Rik. 27/18, 27 March 2020;

Mario Cachia et v. Supermarkets Limited et, Rik. 82/2015, 20 July 2020;

Angela sive Gina Balzan v. L-Onorevoli Prim Ministru et, Rik. 16/2015/1, 8 October 2020;

Michael Farrugia et v. L-Avukat Generali et, Rik. 79/2016, 6 October 2020;

Giovanna Bartoli et v. Carmelo Calleja et, Rik. 46/2018/1, 6 October 2020;

Henry Deguara Caruana Gatto et v. L-Avukat tal-Istat, Rik. 36/18, 23 November 2020.

[2] Joseph Grima et v. L-Avukat Generali et, Rik. 22/19, 27 March 2020,

Brian Psaila v. L-Avukat Generali et, Rik. 12/2018, 27 March 2020.

[3] Mario Cachia et (cited above).