The joint owners of immovable property in Xagħra failed to convince the European Court of Human Rights the government had acted incorrectly with them when it took over their land 36 years ago.

The six applicants owned two pieces of land in Xagħra that was taken over by the government by virtue of an acquisition order in November 1983. No offer for compensation had been made as the authorities were in duty bound to do by law.

In view of the fact that no official action had been taken to regularise the situation they instituted a constitutional case in 2004. The owners claimed a violation of their right to property since they had received no compensation, also complaining they had not been given access to a tribunal to force the authorities to pay them.

The deed of transfer of the land in question was finally published 10 years later and the owners were paid €1.3 million, which was the value established by the Land Arbitration Board, plus interest. However, the interest was calculated as the average between the amount initially offered by the Land Commissioner and that decided by the Land Arbitration Board.

The owners felt their property rights had been breached, arguing that the interest paid was substantially lower than what they would have received under previous practice.

The State had compelling public interest motives

The Civil Court (First Hall), in its constitutional competence, rejected their claims in May 2016. They appealed but the Constitutional Court threw it out in November of that same year.

The Constitutional Court argued that the value of the land was based on a 2005 valuation, which meant the joint owners had already benefitted from the increase in value of the property. It followed that a calculation of interest based on a mean between the two valuations was adequate in the circumstances, it added.

The owners took their case to the European Court of Human Rights in the first quarter of 2017 arguing they had been subjected to legislative interventions that had shifted the balance in favour of the government. 

The European judges, among them Chief Justice Emeritus Vincent De Gaetano, commented in their decision that a State could enact general legislation, which could prove unfavourable to litigants, if it did not actually target pending judicial proceedings and was not aimed at circumventing the principle of the rule of law.

In this case, the Strasbourg-based Court found that the legislative action the land owners complained of did not change the existent legal framework relating to compulsory purchase or compensation but only a general practice on the calculation of interest on compensation, which had not been regulated by law before.

Furthermore, it noted, the legislative action in question did not determine the substance of the dispute but only affected the calculation of interest, usually based on the final payment by the State and not necessarily determined judicially.

The European Court judges felt that the State was only trying to regulate a lacuna in the law, which could have led to applicants taking advantage of interest rates that did not reflect the realities of the market and, in turn, allowed them to make windfall profits. In fact, they added, the State had compelling public interest motives in taking the legislative action it took.

In the circumstances, the joint owners’ complaint with regard to unfavourable legislative intervention was declared inadmissible.