Issue link: https://maltatoday.uberflip.com/i/702141
maltatoday, SUNDAY, 10 JULY 2016 8 MATTHEW AGIUS THE Constitutional Court has effectively handed back to the landlord the right not to renew a lease, ruling that tenants can no longer continue to rely on old rent laws to automatically renew pre-1995 leases. The decision was handed down in an appeal filed by Ian Peter El- lis and Elizabeth Scilio and an in- cidental appeal by the Attorney General from a November 2015 judgement of the First Hall of the Civil Court in its Constitu- tional jurisdiction. The 2015 judgement had held that Ellis and Scilio's right to protection from deprivation of property without compensation had been breached, granting the plaintiffs €20,000 in compensa- tion from the State, but did not uphold their request to order the eviction of Sylvana and Ray- mond Griscti from the Sliema property. The court had heard how El- lis and Scilio had inherited the property in Old College Street, Sliema from their father, Cap- tain John Ellis. In 1957, on the strength of a requisition order against Captain Ellis, the prop- erty was taken from him and al- located to Dr Arthur Portanier, Sylvana Griscti's father. Captain Ellis had chosen not to contest the requisition order and had instead accepted to enter into a lease agreement with Dr Portanier, who would rent the property for the princely annual sum of £61, protected under the Special Lease laws in force at the time. As a result of the agreement, a de-requisition or- der was issued in 1958. Griscti had inherited the lease from her father and as of 1980, had continued to reside in the 410m2 property, worth over €560,000, together with her husband and children, against a revised but still pitifully small annual rent of Lm100 (€233). By comparison, in 2012, a court ex- pert had established the market rental value of the property as being €16,800 per year, or €1,400 per month. The defendant had testified that after her father's passing away in 1998, she had sent a cheque and a new rent book to the plaintiffs, which however, were mailed back. As the rent was being refused, Griscti began depositing the rent in court. Between 2004 and 2010, Cap- tain Ellis and his son, Ian, had started to accept rent payments once more, even holding meet- ings with the tenants to discuss how much the tenants would ac- cept as compensation for vacat- ing the property. But the Grisctis had to start depositing the rent in court again as the landlord started refusing to accept their payments again following the parties' failure to reach an agree- ment. Ellis and Scilio's lawyers filed a constitutional action, describing the situation as one of "construc- tive expropriation," and arguing that their constitutional right to property had been violated over the past 50 years with every an- nual renewal of the lease, which they were legally bound to renew at the original price. "Although there might have been an element of public inter- est when the requisition order was issued, this public interest cannot be said to continue to exist 60 years on," their lawyers submitted. They requested the court to award compensation as the 2010 amendments to the rent laws had not improved the landlord's position at law. The Attorney General had initially argued that the court should decline to exercise its Constitutional powers because the plaintiffs had "failed to ex- haust their ordinary remedies at law." Ellis and Scilio could have refused to enter into a contractual relationship when the ownership of the property had passed into their hands and sought court authorisation to refuse to recognise the tenants, submitted the State. The AG ar- gued that due to the agreement with Arthur Portanier, the cou- ple could not argue that they were suffering the consequences of a requisition order that had been cancelled in 1958. Due to the fact that the plain- tiffs had failed to request the court to declare the rent laws to have breached their fundamen- tal rights, in their initial court application, the First Hall of the Civil Court refused to deal with that issue. On the issue of the requisition of the property by the State, the first court held that the action was legal but in view of the par- ticular circumstances of the case, the plaintiffs were to be granted compensation, fixed by the court at €20,000, nonetheless. Both landlord and Attorney General filed appeals on several grounds, among which was the amount of compensation award- ed – the former arguing that the compensation was just over one year's rent, while the latter ar- gued that it was excessive. Ellis and Scilio submitted that they had suffered a de facto ex- propriation and, consequently, a disproportionate burden as a result of the government's inter- ference. The Constitutional Court, in a sentence it handed down, noted that should a law be found to be violating a party's fundamental rights, that law can no longer be given effect as long as its applica- tion has this effect. Although the Grisctis were en- joying a right arising from the law which is therefore not il- legal, it was also true that once a breach of a fundamental right was established, the situation could not be allowed to persist. The Constitution is the supreme law of the land, said the court, and itself states that any article of the law which is inconsistent with the Constitution is ren- dered null and ineffective by this very fact. It was "clear that the lease was continuously imposed on the landlords from year to year," said the court, also holding that "in the circumstances, the accept- ance of the rent by the owners cannot be legally taken to be a renunciation of their rights." As it could not order the ten- ants' eviction, the Constitu- tional Court ruled instead that the Grisctis could not continue to rely on the Reletting of Ur- ban Property (Regulation) Or- dinance to justify their contin- ued occupation of the property, effectively handing the right of non-renewal back to the land- lord. The court, however also re- duced the amount of compen- sation awarded by the court of first instance to €10,000 due to the passage of decades before the plaintiffs filed their claim. News Constitutional ruling on leases spells eviction for Sliema tenants Where a law is found to be violating a party's fundamental rights, it can no longer be applied as long as its application has this effect