Issue link: https://maltatoday.uberflip.com/i/1540705
The recent amendments to the Small Claims Tribunal Act may not draw much public at- tention, but mark a practical step forward in improving Mal- ta's justice system. The Small Claims Tribunal is designed to handle straight- forward disputes quickly and affordably, without the need for legal representation. It covers issues such as unpaid invoices, unfinished works, or minor property damages in- volving amounts up to €5,000. The new law doubles this limit to €10,000, a seemingly simple change with major implica- tions for citizens, businesses, and the courts. Currently, nearly half of civil cases filed before the Magis- trates' Courts involve claims between €5,000 and €10,000. Shifting these to the tribunal, will free magistrates to focus on complex civil and criminal cases, while giving the public a faster, simpler, and affordable route to justice. This builds on recent pro- gress. Appeals that once took four or five years are now be- ing decided within a year, a major improvement. The lat- est reform continues this mo- mentum by halving the load on magistrates, who often juggle minor disputes with serious criminal proceedings, some- times on the same day. Small cases take up the same court- rooms, magistrates, and ad- ministrative resources as major trials, inevitably creating back- logs. Allowing the tribunal to handle claims up to €10,000, introduces a more rational dis- tribution of judicial work. Beyond expanding its jurisdic- tion, the reform also modernis- es the tribunal's procedures. It eliminates the need for physi- cal hearings, allowing cases to be conducted fully online when possible. This saves time and resources, reduces courtroom congestion, and spares citizens the inconvenience of taking leave from work or searching for parking. When hearings are required, it is encouraged to be held via videoconference, which is another small yet an impactful efficiency. These adjustments make jus- tice faster, less intimidating, and more affordable. Court fees before the Magistrates' Courts can deter people from pursuing legitimate claims, but the tribunal's minimal costs make justice accessible to all. Disputes once abandoned for financial reasons can now be resolved through this stream- lined process. The benefits are twofold: Cit- izens and small businesses get quicker resolutions, while the courts gain breathing space. The result is less bureaucracy, fewer delays, and greater trust in the justice system. Malta's reform also aligns with European best practices. Countries such as the Nether- lands and Luxembourg assign low-value civil disputes to spe- cialised tribunals with thresh- olds even higher than Malta's new €10,000 limit. The chief justice has already expressed support for the ap- proach being taken by the jus- tice minister, recognising it as part of a broader strategy focused on specialisation and efficiency. While these amendments are not revolutionary, they repre- sent a meaningful and well-tar- geted reform. The biggest improvements in governance do not come from rewriting constitutions, but from fixing small things effectively. This reform does exactly. THE choice of law in a contract may be determined either if it is expressly men- tioned or else from what one can gather from the terms and conditions which one applies. This was decided on 14 Oc- tober 2025 by the Court of Appeal pre- sided by Chief Justice Mark Chetcuti and judges Robert Mangion and Grazio Mer- cieca. The case was Malta Fishing Trad- ing Limited vs Dr Fransina Abela noe. The case concerns a loan that the de- fendant company, Al Safa Fishing Joint Stock, represented by Mohamed Fathi Emran Morad, took and which was to finance the purchase of fishing vessels. Part of the debt was assigned to the plaintiff. This case was instituted in order for the debt to be paid and if not paid, the plaintiff would acquire the vessels. The appeal concerned whether Maltese law or French law should apply. The debt amounted to slightly over €1.5 million. A fishing vessel was sold in Jan- uary 2005 to the defendant for €550,000. Another fishing vessel was sold to the defendant for €480,000 in April 2006. Both vessels were financed by a 'contrat de financement'. One of the conditions of these contracts was that in the event the debt was not paid, the creditors, in this case the plaintiff had a right to ac- quire the vessels. Following this there was a bareboat charter agreement be- tween the defendant and the financiers of the purchase of the vessels. The plain- tiff company claimed that the financing took place by means of three investors through a company called BDS. One of the investors and shareholders of BDS transferred his shares to the other two shareholders and a third investor. There was another transfer of shares in March 2007. The court also took cognisance of a contract of 20 December 2007 where BDS assigned all its rights and credit in respect of the defendant to Armement Scannapieco Ltd to the tune of €740,653. In March 2007, the defendant purchased a third vessel. Scannapieco financed the purchase of the third vessel and invested €835,000. On the same day the defend- ant entered into a charter agreement with a company owned by the investor. In the agreement the defendant bound itself to transfer the vessels to the inves- tors or pay back the debt. Fast forward to 2014, the defendant company entered into a bareboat charter agreement for the three vessels to operate in Libyan waters. In 2019, Armement Scannapieco transferred the debt of the defendant to the plaintiff company. The plaintiff asked the court to declare that the defendant owed it €1,575,653 and order that the three vessels be trans- ferred to it. The first court held that the contract should apply Maltese law because it was signed in Malta and the fact that it was written in French did not matter. The defendant also claimed that the 2019 agreement of the assignment of debt between Scannapieco and the plaintiff company could not be enforced in terms of the Rome Regulations I, ar- guing that what had to be established first was whether French law should be applied. The first clause of the 2019 agreement mentions that the agreement should be regulated by Articles 1321 to 1326 of the civil code and that Scannapieco should notify the defendant of the assignment of debt. The agreement does not state whether the civil code it refers to is the Maltese or French one. The court held that the applicable law should be Mal- tese law. The court referred to the notification of a letter sent on 19 September 2019 to a French lawyer as a notification of the transfer of the debt. Article 1471 of the Maltese Civil Code refers to a judicial act. No judicial act was sent. Further- more, Article 1473 reads: "The notice is not necessary if the debtor has acknowl- edged the assignment." The first court concluded there was no evidence that the defendant accepted the assignment and even if French law applied, the agreement was not enforce- able because the letter was not addressed to the defendant. The plaintiff company appealed this judgment, insisting French law should be applied. The Court of Appeal determined that the law on contracts (Rome I) does not mention only that the applicable law should be expressly mentioned but al- so that the choice of law be manifested in the terms of the agreement. In this case the agreement just mentions arti- cles 1321 to 1326 of the civil code. The Court of Appeal pointed out that these articles in the Maltese Civil Code refer to the community of acquests in family law. In the French Civil Code, they refer to the assignment of a contract. The Ap- peals Court determined that French law should be applied. The Appeals Court also disagreed with the first court on the validity of the no- tification. Although the notification did not mention by name the defendant, it was obvious that it referred to him. But this issue was not part of the dispute and therefore, the court should not have en- tered into it. The Appeals Court upheld the plain- tiff's appeal. 8 maltatoday | SUNDAY • 26 OCTOBER 2025 OPINION & LAW The choice of law may be deduced from the terms of the contract Beyond expanding its jurisdiction, the reform also modernises the tribunal's procedures. It eliminates the need for physical hearings, allowing cases to be conducted fully online when possible MALCOLM MIFSUD Mifsud & Mifsud Advocates A leaner path to justice Veronique Dalli Lawyer