Issue link: https://maltatoday.uberflip.com/i/1372546
15 maltatoday | SUNDAY • 16 MAY 2021 NEWS sult with his consultants and it is quite clear that he would have received quite a strong legal ad- vice on this delicate and complex matter. It is very difficult to ar- rive at one answer on this query, and frankly I do not think the Minister actually answered this question." Stafrace thinks that Farrugia's intention was "to raise or pro- voke the argument". What is clearly established in the law according to Stafrace is that "applications must be de- cided according to the policy in force, unless the policy itself states otherwise, at the time of decision." But he also notes that some judgments have actually gone as far as stating that the risk of a change in policy lies with the applicant. Compensation due to owners of property which are subjected to scheduling or pro- tection, has also been dealt with, yet with some "conflicting judg- ments". And while judgements dealing with height limitations have "in- dicated that a height limitation, once established, gives the own- er of the property a legitimate ex- pectation that the development within the said height should be approved" even on this point ju- risprudence did reach "slightly different conclusions" through the application of other poli- cies read concurrently with the height limitation policy". Moreover according to Sta- frace, policies regulating de- velopment "do enable the con- sideration of a development application which may lead to a legitimate decision that a select- ed and limited type of develop- ment should be lower than the height limitation established in the local plan." This is even more the case when other plan- ning policies, such as scheduling or conservation policies, limit development that may otherwise be realised into something prof- itable. But according to Stafrace it is inconsistency in the applica- tion of rules, rather than poli- cy changes, which can lead to claims for compensation. An example he cites are the 2015 development guidelines which cancelled all the height limi- tations established in the local plans in favour of a contextual approach. "Some sites gained and some sites lost their devel- opment potential. Whether this may lead to a claim for compen- sation is a moot point, yet I am of the opinion that such an in- tervention would not lead to an automatic claim for damages." Inconsistency is the problem What could lead to claims for damages is inconsistency in the application of policies. Stafrace says the priority should be to avoid the situation where poli- cies are applied liberally and in a discretionary way. "The way certain rules and policies are applied, when com- pared to how the same rules and policies were applied weeks or months ago is what is creating this conflicting debate. It is diffi- cult, if not impossible to explain how a development is afforded its full development limit on one side of the road (even when the adjacent properties have not yet been developed) and yet a sim- ilar application regulated by the same rules and policies in the same road is refused…. To me, this is what is, and will be, ex- posing the Authority to claims for damages." Stafrace augurs that policy- makers will not ignore this reali- ty and simply rely on the subjec- tive assessment of the Planning boards. "The policies, even if needy of adjustments, must be clear and if a policy needs to be adjusted then it should be ad- justed." For this reason, concerns on compensation claims should not preclude government from changing the rules if there is a need to do so. For example, Stafrace notes that when the government for- mulated a fuel station policy and four years later realised it is not working, government changed that policy. The same applies with the Rural Policy Develop- ment Guidelines, which are be- ing amended. Even development guidelines issued in 2007 were replaced through new ones is- sued in 2015. "Every time a poli- cy changes, you either give more or you take away more. If that were not the case, then it is use- less changing a policy. If you feel a change is necessary, you have to make that change as long as you do it correctly and fairly." Stafrace acknowledges that the issue of height limitations is very sensitive. Yet the debate can't be simply ignored. "In allowing a very subjective interpretation and application of the rules now, in my mind this gives more room to contestations than if you just go along and do the necessary changes – always if you feel that those changes are needed." What does European law say? Any claim for compensation made by developers, if rejected by local courts is bound to end up challenged in the European courts. One such case involved an 11,000sq.m plot of land origi- nally bought for Lm60,000 by Trimeg Limited for commercial purposes that was scheduled by the government. When bought the land was still part of the development zone, being con- firmed as a "white area" (where development parameters were still to be approved at a later date) in the temporary plans ap- proved in 1989. But the land was 'scheduled' in 1996 to be included in the valley protection zone and its buffer zone. In the Maltese courts, the com- pany claimed that its property had diminished in value alleg- edly from €11 million to just €230,000. In 2010, the Maltese constitutional court reversed an earlier decision by the law courts which had found grounds for compensation, in a decision which affirmed the "state's mar- gin of appreciation in impos- ing planning restrictions" and concluded that in this case the company did not have "a legit- imate expectation that it would be granted such permits", and that "no right to compensation arose" because when the site was bought planning parameters still had to be established for the site. The case was appealed again, this time in front of the Euro- pean Court of Justice, with Tri- meg claiming their right for "the peaceful enjoyment of their pos- sessions" was breached by the scheduling. But the European Court threw away the case, arguing that the scheduling was based on the Development Planning Act and was, therefore, provided for by law and pursued "in the general interest, namely the conserva- tion of areas of ecological and scientific value, in accordance with international require- ments". A legal expert in the field con- firmed that "expecting the law not to change in the future is not considered a legitimate expecta- tion under EU law". The expert pointed out that this principle has been consist- ently adopted when European courts are faced by claims for compensation when business operators face changes in legis- lation. In one particular case, the Eu- ropean Court of Justice declared that rights of ownership are al- ways "subject to limitations laid down in accordance with the public interest." Moreover, the same case states that guarantees for property rights cannot be extended to protect mere commercial inter- ests "the uncertainties of which are the very essence of economic activity." Former PA chief executive Ian Stafrace thinks that Farrugia's intention was "to raise or provoke the argument" is legitimate has been when faced compensation over