The Court of Appeal, composed of Justice Joseph R. Micallef, Justice Noel Cuschieri and Justice Joseph Zammit McKeon, on November 3, 2015, in the case Franco Dipasquale v Gaetano Abela, held among other things that retrial was an extraordinary remedy to be interpreted restrictively. In this case Dipasquale as buyer sued Abela for damages, instead of asking for rescission of the sale or for a reduction in the purchase price, upon discovering that the property which he had acquired was not covered by an appropriate planning permit.

Franco Dipasquale acquired from Gaetano Abela the premises at No. 18, Bramel Street, Swieqi as his residence for Lm12,000 in terms of a contract of acquisition dated November 14, 1991 published in the acts of Notary Peter Fleri Soler.

Subsequently in 2004, when Dipasquale wished to oppose a proposed development in the airspace above his tenement, he was notified by Mepa that his property was not sanctioned by a planning permit for use as a dwelling home. He was later served with an enforcement notice.

Faced with this situation, he proceeded to file legal proceedings against Mr Abela for damages, on grounds that Abela sold him the property not covered by an appropriate planning permit.

Abela in reply contested the legal action against him. In the first place he pleaded that Dipasquale’s legal action was null. It was argued that, in a contract of sale, the buyer had only two remedies: an action to rescind the sale or the actio acstimatoria, to request a reduction in the purchase price.

He further submitted that Dipasquale’s legal action was time-barred in terms of Article 2153 Civil Code (two-year prescription). He added that that Dipasquale did not suffer any damages and that he should not be held responsible in any way for the damages.

In its decision on May 9, 2008, the First Hall of the Civil Court dismissed Abela’s pleas, and ordered the case to be continued. It noted that Abela, in the contract of sale, gave guarantees of peaceful possession and free unrestricted enjoyment of the premises.

The first court held that Dipasquale’s legal action was valid, under article 1390 of the Civil Code, even if formally his legal action was somewhat different from what was stated in the law. The court did not feel the need to be over formalistic.

The plea of prescription under article 2153 Civil Code was also dismissed.

In a further decision on October 15, 2010, the First Hall of the Civil Court condemned Abela to pay Dipasquale €15,408 damages. The court considered that there was no doubt that the property could not be used for the intended purpose. It construed Dipasquale’s legal action as a request for a reduction in the purchase price. It noted that, according to evidence produced by Dipasquale, the same property without a permit was valued at Lm75,000. In view of the fact that the purchase price was Lm12,000 the court ordered a proportionate reduction of Lm6,015 (€15,408) in the purchase price.

Both parties filed an appeal. Dipasquale sought an increase in compensation while Abela reiterated his claim that Dipasquale’s legal action was time-barred and that it was legally not sustainable.

In Caruana v Vella dated March 27, 2003, it was held that the seller was responsible for damages as the apartment was not covered by a permit. Reference was also made to Mallia Bonello v Camileri (CA) dated February 1, 2008.

In Axiaq v Galea et, dated May 2, 2008, a case involving a sale of a property without a permit, the Gozo Court of Magistrates declared that the remedies were not limited to the contract of sale remedies. Reference was then made to Giuseppe Stassano in Codice della Compravendita.

In light of these principles, the court said that Dipasquale’s legal action could not be rejected, in particular since it resulted that Dipasquale wished to acquire a dwelling house from Abela. He had a right for damages and his legal action was not subject to article 2153 of the Civil Code (two-year prescription). The lack of a permit was a contractual failure on the part of the seller. A seller was obliged to deliver the “object of sale” for its intended use, pointed out the court.

Abela was under the impression that his obligation as seller terminated upon signing the contract of sale. The relations of the parties, however, under the contract continued until the contract was not terminated

The Court of Appeal maintained that the damages should not be limited to a reduction in the purchase price. It maintained that the damages had to be realistic, and had to correspond to the loss, actually suffered, which was Lm43,000.

The Court of Appeal on May 30, 2014, dismissed Abela’s appeal, accepting instead Dipasquale’s appeal and ordered Abela to pay €100,163 damages (equivalent to Lm43,000) with legal interests.

In this case now, Abela requested the Court to revoke the Court of Appeal’s decision of May 30, 2014 and to re-hear the appeal of the court’s decisions dated May 9, 2008 and October 15, 2010, on grounds of article 811(e) Chapter 12 (wrong application of law).

The court said that “retrial” was an extraordinary remedy, and that it should not be used to have a court of “third instance”.

Abela based his request for a retrial upon article 811(2) Chapter 12 – wrong application of the law. If the court applied the proper law incorrectly there was no ground for any retrial. It had to be shown that the court applied the wrong law which should not have been applied in the circumstances.

The court noted that Abela failed to indicate what law should have been applied.

Abela complained that at the time of the contract he had no obligation to apply for a permit and the court applied the law with retrospective effect. This court disagreed. Abela was under the impression that his obligation as seller terminated upon signing the contract of sale. The relations of the parties, however, under the contract continued until the contract was not terminated.

Abela claimed that the court imposed upon him duties that were not mentioned in the law. The court stated that this was not the case of wrong application of law. In fact, this issue had already been considered and decided upon, and it could not be raised again now.

Abela’s third grievance was that the Court had applied incorrectly articles 1045, 1136 and 1137 Civil Code, in quantifying the damages.

The court felt that Abela was attempting to reopen the case after it had been definitively determined by the court of appeal. It could not understand the relevance of article 1045 of the Civil Code as this provision had never been raised previously.

It was clear that the court had based its decision upon contractual non-performance and cited the relevant legal provisions, but not those mentioned by Abela.

For these reasons, on November 3, 2015 the Court of Appeal gave judgment by declaring that Abela had no grounds to request a retrial. It also dismissed his requests to revoke the court decision of May 30, 2014.

Dr Karl Grech Orr is a partner at Ganado Adovates.

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