Appeal Court confirms property transfer invalidation

The Court of Appeal has dismissed an appeal filed by Antoinette Cachia and Henry Aquilina from a judgment by the First Hall of the Civil Court which had nullified the transfer of property in Bahar ic-Caghaq.

The court heard that Mr Aquilina's wife had filed a writ declaring that the couple were factually separated. The husband lived in Malta and the wife in England.

In 1980 and 1981 the husband had bought two portions of land in Bahar ic-Caghaq. Subsequently, a terraced house, a maisonette, a flat and a bungalow were built on this land.

In 1998, Mr Aquilina had transferred to Ms Cachia a one-half undivided share of the maisonette and the flat. The transfer took place on the basis that Mr Aquilina allegedly owed money to Ms Cachia.

The wife claimed that this transfer constituted an extraordinary act of administration of property forming part of the community of acquests existing between herself and the husband. As a result, the transfer could only have taken place jointly by the parties and not by the husband alone.

The wife had asked the First Hall of the Civil Court to declare that the transfer of the property to Ms Cachia was in violation of her rights and to annul and rescind the transfer.

Defendants pleaded that the writ was unfounded for the wife had abandoned the matrimonial home 20 years previously and had thus forfeited her rights. They further pleaded that the property in issue was built after the husband borrowed money from Ms Cachia. The transfer therefore consisted of payment of the credit held in Ms Cachia's favour.

The First Hall of the Civil Court upheld the wife's writ and declared that the transfer could only have taken place if the wife was a party to the deed.

The First Court declared that, in terms of law, any transfers of real rights over immovable property constituted acts of extraordinary administration and could be annulled upon the request of the other spouse who had not participated in the transfer.

The court declared that, as the couple had married in Malta, their marriage was governed by the system of the community of acquests for no evidence had been produced to the contrary. The property purchased by the husband in 1980 and in 1981 therefore formed part of the community of acquests.

When referring to defendants' plea that the wife had abandoned the matrimonial home, the First Court said that it clearly resulted from the law that any loss of rights in the community of acquests, caused by abandonment, did not arise automatically but after a judgment to this effect was delivered. No judgment had been delivered in this sense, so this plea was dismissed.

The fact that the transfer of the property had taken place in order for the husband to pay his debt to Ms Cachia was irrelevant for the purposes of this action, the court ruled, and defendants' plea was also dismissed.

Defendants then lodged an appeal to the Court of Appeal composed of Chief Justice Vincent Degaetano, Mr Justice Anton Depasquale and Mr Justice Albert J. Magri.

On appeal the husband and Ms Cachia submitted that the first court's judgment was based upon the assumption that the marriage between the parties was governed by the community of acquests. They submitted that it did not result that the husband and the wife had established their domicile in Malta. Although the parties had married in Malta in 1955 they had established their domicile in England. As a result, defendants submitted that the applicable law was that of England.

However, the Court of Appeal upheld the submission filed by the wife that this was a new plea that had not been raised before the first court and, as a result, it could not be considered by the Court of Appeal.

The appellate court added that the law did not contemplate any exception to the general rule that the celebration of a marriage in Malta brought about the application of the community of acquests unless there was a public deed to the contrary.

In the absence of such public deed and in the absence of any judgment or contract that eliminated the community of acquests, defendants' submission could not be upheld.

The court also dismissed defendants' submission that the abandonment of a spouse had the effect of enabling the deserted spouse to enter into contracts without the consent of the other spouse, except when such spouse raised an active opposition.

However, the Court of Appeal declared that it clearly resulted from the law that any acts of extraordinary administration had to take place with the participation of both spouses and not simply with the other spouse's consent.

Defendants further submitted, in appeal, that the judgment of the first court was incorrect. The First Hall of the Civil Court, they argued, ought not to have limited itself to a simple annulment of the transfer between defendants. The court ought to have also provided for compensation to Ms Cachia.

However, the Court of Appeal upheld the submission raised by the wife and confirmed the conclusions reached by the first court to the effect that the credit held by Ms Cachia against the husband was not part of the merits of this case.

In conclusion, the Court of Appeal confirmed the judgment delivered by the First Hall of the Civil Court with costs against defendants.