Court awards €1,187,800.39 after finding that Malta's rent control laws imposed a disproportionate and excessive burden on commercial property owners from 1987 to 2024.
Civil Court — First Hall (Constitutional Jurisdiction) · The Honourable Judge Miriam Hayman LL.D. · 29 April 2026
Eight co-owners of a commercial property known as 'Saint Joseph', Triq l-Erba' Qaddisin, Ħal Qormi — all heirs of the original owner Emanuel Schembri who died in 1986 — brought a constitutional application claiming that Malta's rent control legislation had violated their fundamental right to the peaceful enjoyment of their property. The property had been leased without a written contract to the father of Alfred and Joseph Manduca since the 1960s, originally as a gas depot. The annual rent, after decades of statutory regulation, stood at only €1,454.18, while the free market rental value was vastly higher. The petitioners argued that Chapter 69 of the Laws of Malta (the Reletting of Urban Property (Regulation) Ordinance) and Act X of 2009 — which extended protected commercial leases until 2028 — denied them any meaningful ability to recover possession or charge a fair market rent. They invoked Article 37 of the Constitution and Article 1 of the First Protocol to the European Convention on Human Rights, alleging both provisions were being violated. The court dismissed the Article 37 constitutional ground, accepting the Advocate General's argument that Chapter 69 was enacted before 3 March 1962 and is therefore saved by Article 47(9) of the Constitution, which shields pre-independence legislation from challenge under Article 37. However, the court upheld the claim under Article 1 of the First Protocol to the ECHR. Relying on extensive Maltese and Strasbourg jurisprudence — including Zammit and Attard Cassar v Malta (ECtHR, 2015) — the court found that the rent control mechanism failed to strike a fair balance between the general interest and the applicants' property rights, imposing a disproportionate and excessive burden on the owners. A court-appointed technical expert, Perit Michael Lanfranco, calculated the free market rental value of the property for each year between 1987 and 2024, arriving at a total of €1,879,379.36. Applying the jurisprudential formula — a 20% reduction for the legitimate aim of the law, a further 20% reduction for market uncertainty, and then deducting €25,002.39 in rent actually received — the court assessed pecuniary damages at €1,177,800.39 and added €10,000 in non-pecuniary damages. The total award of €1,187,800.39 was ordered against the Advocate General (the State), together with costs. The Manduca tenants, who had acted lawfully throughout, were found to bear no personal financial responsibility.
Court declared violation of Article 1 of the First Protocol to the ECHR for the period 30 April 1987 to 31 December 2024. Awarded total compensation of €1,187,800.39 against the Advocate General (State of Malta): €1,177,800.39 pecuniary damages and €10,000 non-pecuniary damages, plus costs. Claim under Article 37 of the Constitution dismissed. Fifth prayer (additional remedies) refused. Tenants Alfred and Joseph Manduca bear no financial liability.
Article 1 of the First Protocol to the ECHR (Cap. 319, First Schedule); Chapter 69 Laws of Malta (Reletting of Urban Property (Regulation) Ordinance); Act X of 2009; Article 1531D and 1531I of the Civil Code (Cap. 16); Article 37 and Article 47(9) of the Constitution of Malta