The Court of Appeal, composed of Chief Justice Vincent De Gaetano, Mr Justice Joseph A. Filletti and Mr Justice Geoffrey Valenzia, in the case “Doris Mamo as special mandatary of Lindsay James Abbot vs Bank of Valletta plc et”, on July 30, 2010 held, among other things, that, once the defendant bank had acted correctly, it was only fair that it should not be condemned to suffer the costs of the lawsuit.

The facts in this case were as follows:

The late Connie Montebello was a Maltese national who migrated to Australia. She lived in Australia for 32 years and after her death it was her wish that she would be buried in Malta.

In Australia, she had divorced her first husband and re-married Lindsay James Abbot in 1981. She resided in Melbourne, until her death.

She visited Malta three times, to meet up with her relatives. She also opened bank accounts with Bank of Valletta and purchased property in Malta which she later sold.

Ms Montebello had no children.

In 1976, she made a will appointing her brothers/sisters who lived in Malta as her heirs.

Upon her death, her widower Lindsay James Abbot requested the bank to release all funds of his wife to him.

Bank of Valletta, however, refused, in the face of competing claims by the deceased’s nephew and niece.

The deceased’s nephew and niece put forward the argument that they were the heirs of Ms Montebello, as results from her 1976 will, which, they said, should take precedence.

Faced with this situation, Mr Abbot filed legal proceedings in Malta against Bank of Valletta plc.

Subsequently, Jimmy Montebello and Mary Camilleri, the deceased’s nephew and niece, were authorised to intervene in the proceedings.

Mr Abbot claimed that his wife died intestate and that he was her universal heir, under Australian law. Mr Abbot stated that, as soon as he married Ms Montebello, her last well of 1976 was automatically revoked.

According to principles of Private International Law as enunciated by Maltese courts, the moveable assets of the deceased were regulated according to the law of her domicile at the moment of her death. Once she was domiciled in Australia, Mr Abbot contended that Bank of Valletta was not justified to refuse to release the funds, without good reason at law.

For these reason, Mr Abbot requested the Maltese Courts of Justice

(1) To declare that Bank of Valletta was retaining funds of the late Connie Montebello;

(2) To liquidate the funds with interests;

(3) To declare that he was her sole heir and to order Bank of Valletta to release the funds deposited in the name of his late wife.

In reply, Bank of Valletta submitted in defence that Mr Abbot had to produce evidence that he was the universal heir. It had to be determined as to which law applied: whether Maltese law or Australian law.

Bank of Valletta maintained, in addition, that even if the court were to decide in favour of Mr Abbot, it still should not be condemned to suffer judicial costs.

It withheld funds allegedly for good reason: lack of proof as well as in the light of competing claims. BOV maintained that it could not decide to whom to release the funds and that its actions were justifiable in the circumstances.

Mrs Camilleri, raised the following pleas:

• Lindsay James Abbot had no right to file this lawsuit. His marriage to their aunt could not be recognised in Malta, as her divorce was never registered in Malta.

• According to her aunt’s last will, he was not her heir.

• Her aunt’s domicile reversed to Malta, after she purchased property in Malta.

• Her heirs were her aunt’s brother and sister.

On March 12, 2008, the first court held that, according to Maltese case-law, in the absence of any legal provision, Maltese courts had to apply the principles of the UK’s Private International Law re: “G. Spiteri vs E. Soler et” (CA) dated October 22, 1937.

In the circumstances, the law of Ms Montebello’s domicile applied.

A distinction was drawn between moveable and immovable property.

While the transfer and acquisitions of immoveable property was regulated by the law where the property was situated; in the case of movables, however, these were regulated by the law of the domicile.

Reference was made to Cheshire and North – Private International Law: “It has been established for some two hundred and fifty years that movable property in the case of intestacy is to be distributed according to the law of the domicile of the intestate at the time of his death.”

“Domicile” had to be understood according to English law.

In this case, the deceased had acquired a domicile of choice by moving to Australia. The fact that she was buried in Malta was ­irrelevant. This did not mean that the deceased intended to change her domicile. Though it was true that she bought property in Malta, this was sold during her lifetime.

There was no indication that she had any intention of returning to Malta in her last days – this would have revived her domicile of origin.

The first court pointed out that the deceased married legitimately in Australia. Her first marriage was dissolved in Australia according to her lex domicilii, Australian law.

It said that Mr Abbot was to be considered as her lawful husband and had a right to recover the moveable assets in Malta.

For these reasons the first court ordered that the funds deposited with Bank of Valletta should be returned to Mr Abbot, with accumulated interests. It dismissed Bank of Valletta’s defence, as well as Mrs Camilleri’s claims. The court said that Mr Montebello and Mrs Camilleri had not proven that they were the heirs of Ms Montebello.

Aggrieved by the decision of the court of first instance, Bank of Valletta entered an appeal, claiming that it should not suffer costs of this lawsuit.

The bank should not be penalised for being cautious. The costs should be borne by the persons who had no right to the inheritance.

On July 30, 2010, the Court of Appeal gave judgment by accepting the Bank of Valletta’s appeal. The court concluded that the bank had acted correctly. It allowed the parties to resolve their dispute before agreeing to release the funds.

The bank was not given ­sufficient information to take a reasoned decision. There was no justification, therefore, that the bank should suffer the costs of the lawsuit, in particular when the bank had acted carefully.

The Court of Appeal varied the decision of the first court in part. It ordered that the costs should be borne equally by Mr Abbot and the interveners, Mr Montebello and Mrs Camilleri. The costs of the appeal had to be borne by the interveners.