Issue link: https://maltatoday.uberflip.com/i/1416377
maltatoday | SUNDAY • 3 OCTOBER 2021 18 COMMERCIAL THE fact that the lessor accept- ed the rent for several years, even though there was a breach of the lease conditions on the part of the lessee, has its consequenc- es. This was held in a judgement delivered on 27 September 2021 in Bonnici & Zahra Limited -v- Caros Holdings Limited by the Rent Regulation Board pre- sided by Magistrate Dr Josette Demicoli. The Applicant Com- pany filed an application where- in it explained that the Parties entered into a lease agreement with Caros Holdings to rent out a commercial complex in Qormi. The lease agreement was signed in 2000 and during these 20 years the lease agreement was extend- ed. HOWEVER, according to the lease agreement, the tenants, Caros Holdings were to issue an insurance policy which was to be approved by the owning compa- ny Bonnici Zahra Ltd. The Appli- cant Company requested copies of the insurance policy but never received it and in terms of Article 1570 of the Civil Code the lease can be terminated because there was a breach of a condition. The Applicant Company asked the Court that Caros Holdings was in breach of the lease agreement and to terminate the lease. The Defendant Company replied by saying that the property was in- sured and the Applicant Com- pany's interests were protect- ed. Furthermore, such a breach should not result in termination. The Board referred to the Appli- cant's submissions which stated that the Defendant Company never bought the insurance pol- icy. This was purchased by the subtenant. Furthermore, there was no approval by the Appli- cant Company. The Defendant Company emphasized that the Applicant Company was in fact protected and there was an in- surance policy in place. The fact that the Applicant Company did not have a copy of the policy did not prejudice its position. The evidence produced shows that the property was subleased a number of times. In August 2008 the Applicant Company sent a letter to the Defendant Company reminding them of their obliga- tion to purchase a suitable in- surance policy and to pay for the replacement of a door which was removed. Another similar letter was sent in February 2018. The evidence showed that the Defendant Com- pany always paid the rent, which was accepted by the Applicant Company. The Board was shown a copy of the insurance policy issued by the sublessee and the Board noted that the policy did include the building and includ- ed insurance against earthquakes and fire was not excluded from the policy. The policy started on 1 September 2013 with a maxi- mum €700,000. The policy also covered both parties to this case. The Board in its considerations held that it was clear that before November 2011 the property was not covered by an insurance pol- icy. Even when the Defendant Company received a letter from the Applicant Company the copy of the policy was not passed on. The Board was being asked to terminate the lease and based the actions on Article 1570 of the Civil Code which states that the lease may be terminated even if there is no resolutive condition, if one of the conditions is not ad- hered to. The Board may either order that the condition be ad- hered to or the lease be terminat- ed together with damages. The Board held that one would have to examine Articles 1566, 1567, 1568 and 1569 (1) which list the circumstances under which a lease may be terminated. Articles 1569 (2) and (3) state that if the owner wants to terminate, he/she should send a judicial act. If there is a resolutive condition in the lease agreement then the Board is precluded from giving time to the tenant to do what is required. In this particular case, the Ap- plicant Company did accept the rent for 17 years irrespective of the fact that it did not have a copy of the insurance policy. It took the Applicant Company 10 years to remind the Defend- ant Company to send copies of the policy. In Katia Mercieca noe v Joseph Bezzina decided by the Court of Appeal on 4 October 2019 held that by accepting the rent there was a tacit consent that irrespective of the breach the lease should continue. Apart of this point the Board held that it is satisfied that from Novem- ber 2011 there was a valid insur- ance policy. The Board moved to reject the claims as listed in the application. Accepting the rent irrespective breach of contract has its consequences LAW REPORT MALCOLM MIFSUD Mifsud & Mifsud Advocates Nominations open for EY's Malta Entrepreneur of the Year 2022 Award THE nominations for EY's Mal- ta Entrepreneur of the Year 2022 award are now open. Entering its fifth year, the award pro- motes entrepreneurship across the Maltese Islands and empow- ers entrepreneurs to grow and showcase their businesses both locally and globally. Depending on the Covid-19 situation at the time, the local winner will head to Monaco in June 2022 to compete for the EY World Entrepreneur of the Year award, an event that brings together national win- ners from more than 50 coun- tries. Previous participants and winners have included trail-blazing entrepreneurs from a wide range of enterpris- es such as Amazon, Cirque du Soleil and LinkedIn. Past Malta winners include Alfred Pisani from Corinthia Group, Angelo Xuereb from AX Holdings Ltd, David Darmanin of Hotjar Ltd and most recently, Nazzareno Vassallo from Vassallo Group. When asked about the award, the 2021 winner Nazzareno Vassallo said: "I am honoured and humbled to be chosen for the award. It was a difficult year, but as a Group we man- aged to go through – mine was a long journey -54 years start- ing from construction and then diversifying. This success was also the suc- cess of the 1,800 employees and I want to dedicate this honour to all of you" The EY Rising Star award is also presented to a contender running a high-growth busi- ness that is generating excite- ment in the market. Past win- ners include David Vella from Altaro Software, Shane Hunt- er from AquaBioTech Group, Ben Remfrey from Praedium Consulting Malta Ltd and John Winfield from Dr. Juice. The 4th EY Rising Star, John Winfield, spoke about winning the award: "I am very grateful to receive this award. Dr. Juice is all about passion and con- necting with our community and I would like to thank all my family and the Dr. Juice family for making this award, as well as all the achievements made over the last years, possible." The award is judged by an in- dependent panel made up of key figures from the business community. To be eligible, nominees must be Maltese or have been operating a compa- ny based in Malta for at least two years. Anyone, including employees, company advisers and financiers, can nominate an entrepreneur, with the lat- ter's consent. Entrepreneurs may also directly nominate themselves. The awards are held in con- junction with the Malta Cham- ber of Commerce, Enterprise and Industry, and the Malta Chamber of SME's. For more information and to submit a nomination: www.eoymalta.com. Contact eyevents@mt.ey.com for any queries.