Court compensation for the transfer of a private property that was part of the National Bank’s takeover by the State in the mid-1970s was slashed from €1 million to €25,000 following an appeal by the Attorney General.
The Constitutional Court also ruled that Bank of Valletta, set up by the government following the takeover, could no longer use the property in question on the basis of two laws, which were found to be in breach of the fundamental right to property.
The First Hall of the Civil Court, in its constitutional jurisdiction, last February ordered the Attorney General to pay €1 million in compensation to the heirs of the late Marquis John Scicluna. The compensation was awarded after the first court ruled that the transfer of the property in St George’s Square, Valletta had breached the owners’ fundamental rights.
The late marquis had rented the property to his bank for 10 years in 1958 against an annual rent of £800, which was extended in 1968 to incorporate adjacent properties in Strait Street. Subsequently, Scicluna’s Bank was amalgamated with the National Bank of Malta and the lease was renewed annually according to law. When set up, Bank of Valletta took possession of the property on the strength of Act XLV of 1973 and Act IX of 1974.
The first court ruled the transfer of the property in St George’s Square, Valletta, breached the owners’ fundamental rights
The Attorney General appealed, arguing that the compensation awarded by the first court was excessive and that there had been no breach in the right to the enjoyment of property. The heirs demanded a higher compensation and insisted the bank should vacate the property.
The Constitutional Court, presided over by Chief Justice Silvio Camilleri, Mr Justice Giannino Caruana Demajo and Mr Justice Noel Cuschieri, noted that when awarding compensation, it had to take into account factors including the time elapsed before the complainants instituted legal proceedings - 23 years – and the disproportionate amount between the annual rent of €4,277 which the bank was paying and the estimated commercial rent established by a court-appointed expert of €159,350 a year.
The court lowered the compensation to €25,000 while pointing out this had to be taken within the context of its decision on the legality of the laws of 1973 and 1974.
As for the eviction request, the judges said constitutional proceedings were not the adequate forum to deal with such a matter but, rather, an ordinary court or the Rent Regulation Board.