European Court of Human Rights

FOURTH SECTION

CASE OF GALEA AND OTHERS v. MALTA

(Application no. 68980/13)

JUDGMENT

STRASBOURG

13 February 2018

This judgment will become final in the circumstances set out in Article 44 § 2 of the Convention. It may be subject to editorial revision.

In the case of Galea and Others v. Malta,

The European Court of Human Rights (Fourth Section), sitting as a Chamber composed of:

Ganna Yudkivska, President,
Vincent A. De Gaetano,
Paulo Pinto de Albuquerque,
Iulia Motoc,
Carlo Ranzoni,
Georges Ravarani,
Marko Bošnjak, judges,
and Marialena Tsirli, Section Registrar,

Having deliberated in private on 23 January 2018,

Delivers the following judgment, which was adopted on that date:

PROCEDURE

1. The case originated in an application (no. 68980/13) against the Republic of Malta lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (-�the Convention-�) by six Maltese nationals (-�the applicants-�) on 21 October 2013. A list of the applicants is set out in the appendix.

2. The applicants are all represented by Dr Peter Borg Costanzi, a lawyer practising in Valletta, Malta. The Maltese Government (-�the Government-�) were represented by their Agent, Dr Peter Grech, Attorney General.

3. The applicants alleged that they had been deprived of their possession without any compensation, and without the possibility of accessing a court to raise their claims in that connection.

4. On 29 May 2015 the application was communicated to the Government.

THE FACTS

I. THE CIRCUMSTANCES OF THE CASE

A. Background to the case

5. Since 2002, following their ancestors-� demise, the applicants have been the holders of the utile dominium (by way of sub-emphyteusis which expires in 2047) of a portion of land in Zabbar, Malta. The directum dominus (direct owner) is the State.

6. The applicants-� ancestors acquired the utile dominium of the property also through inheritance from a certain X. who had held the property under title of temporary sub-emphyteusis of 150 years. On the said property there was a shop which was rented out to third parties as a snack bar.

7. By a Governor-�s declaration of 7 May 1965 published in the Government Gazette on 14 May 1965 (no. 290), a part, amounting to 80 sq. m. (including the shop of an area of approximately 50 sq. m.), of the applicants-� property (as well as other land not held by the applicants) was declared to be needed for a public purpose under the Land Acquisition (Public Purposes) Ordinance, Chapter 88 of the Laws of Malta (hereinafter, -�the Ordinance-�).

8. The Government took possession of the entirety of the property mentioned in the declaration and demolished the shop in order to build a local civic centre and service roads (in connection with a development project for the locality). However, in 1972 changes were made to the plan (pjan regolatur). Specifically it was decided to reposition the road which had to be built on the part of the land on which the shop had stood. Thus, it was decided that on that plot of land which adjoined another larger plot of land (not owned by the applicants), a new shop would be built at the Government-�s expense in order to serve the square and the civic centre, as well as government offices and for use as a bus terminus. The civic centre at that time hosted the Zabbar Local Council, a social-security office, a police station, a post office, a snack bar, a butcher-�s shop, a draper-�s shop, a beauty parlour and a grocer-�s shop.

9. The new shop (of larger dimensions than the previous one) was built mostly on the applicants-� land and leased to the same third party mentioned above for use as a snack bar. The remaining small area of land, belonging to the applicants-� ancestors, which had been taken but not used, was returned to them in 1988.

10. Extra-judicial requests to obtain the return of the property used for the purposes of the snack bar were to no avail.

11. Pending the constitutional-redress proceedings (below), on 13 April 2010 the Commissioner of Land (hereinafter -�the Commissioner-�) extended the lease in favour of the third party until 31 January 2020, at a rent of approximately 2,100 euros (EUR) per year.

12. In the light of Article 9 of the Ordinance and Act I of 2006, on 6 October 2010, by a President-�s declaration of 3 September 2010, the sum offered for the taking of 7 May 1965 was EUR 13,000 in accordance with an architect-�s valuation dated 1 January 2005.

13. In 2010 the bus terminus was moved as a result of changes in the transport system. Currently, within a radius of 300 m of the civic centre there are eleven establishments offering take-away food services (bars, snack bars, confectioners-�, pizzerias, pastizzerias, and so forth).

B. Constitutional redress proceedings

1. First instance

14. On 2 March 2010 the applicants instituted constitutional redress proceedings. They complained that they had suffered a breach of Article 1 of Protocol No. 1 to the Convention, in so far as their land had not been taken in the public interest, and of Article 6 of the Convention, as well as the corresponding provisions of the Constitution of Malta. They requested that the court annul the Governor-�s declaration in respect of their property, order that it be returned to their possession and award adequate redress.

15. By a judgment of 26 June 2012 the Civil Court (First Hall), in its constitutional jurisdiction, upheld the applicants-� claims.

16. The court noted that pursuant to the Ordinance, as it was at the time, it had been the Commissioner who had had to make an offer, and in the event that the offer had been refused, the same Commissioner had had to institute proceedings before the Land Arbitration Board (hereinafter -�the LAB-�). Pursuant to the Ordinance as amended, it was still for the Commissioner to make an offer. It was open, however, for the receivers of the offer, if they disagreed, to institute proceedings to challenge the offer before the LAB. Nevertheless, in the present case, it had taken forty-�five years for the Commissioner to make an offer, during which time the applicants had had no possibility of initiating proceedings, and thus had no ordinary remedies to exhaust in connection with their request for compensation. The same applied concerning their complaint of a lack of public interest despite amendments to the law in 2009 (Act XXV of 2009) -� which had introduced the possibility of challenging the public interest of an expropriation before the LAB, within twenty-one days of the declaration - in the court-�s view it was unlikely that an individual would be able to challenge a public interest which had not been mentioned in the declaration.

17. As to the complaint concerning the applicants-� property rights, having extensively referred to domestic as well as Strasbourg case-law, the court held that the taking had not been in the public interest in so far as the property had been leased to third parties as a snack bar and thus for commercial purposes. It had solely and intrinsically served private interests, specifically those of the third parties who had been leasing the property merely for commercial purposes, irrespective of the fact that the snack bar had been regularly used by bus drivers. Furthermore, the applicants had received no compensation in forty-five years, and the offer made to them in 2010 (solely after constitutional redress proceedings had been commenced) had been based on a valuation from 2005. In the court-�s view, based on the rent as submitted by the Commissioner, -�capitalised-� at the rate of 3.5% applicable in such cases, the value of the property was approximately EUR 60,000, that is to say five times the sum offered by the Commissioner. The situation was made even worse by the lack of procedural safeguards (as mentioned above) through which they could challenge their situation, which also meant that they had not had any access to court in order to claim compensation, as required by Article 6 of the Convention.

18. The court annulled the Governor-�s declaration of 7 May 1965 and the President-�s declaration of 6 October 2010 as well as any other action, affecting the property, taken by the defendant pending the proceedings. It ordered the return of the property (vacant possession) in favour of the applicants and awarded EUR 40,000 in compensation including non-�pecuniary (moral damage as known in the domestic system) and pecuniary damage (material damage) covering occupation of the premises until the date of return, in connection with the breach suffered.

2. Appeal

19. The defendants appealed, arguing that there was a public interest and challenging the award of compensation and the return order.

20. By a judgment of 26 April 2013 the Constitutional Court allowed the appeal in part and quashed the first-instance judgment in part.

It considered that at the time of the declaration the taking (of the land on which the shop had stood) had been certainly in the public interest, specifically the building of roads giving access to the public. It was true that use of that plot of land had changed in 1972, as it had been decided to build a snack bar (and later to lease it) to see to the needs of the users of the square, as well as the civic centre, government offices, and a bus terminus. Thus, in the Constitutional Court-�s view the fact that it had been rented out to third parties had not diminished the public interest in the taking. Nevertheless, there had been a violation of the applicants-� property rights in so far as they had been deprived of their property for a number of years without any compensation. In particular they had received no compensation whatsoever for the part of the property taken and not used, which had been returned to them only after twenty-three years, and in respect of the remaining part which was used, the applicants were still awaiting compensation. The Constitutional Court however disagreed with the redress given by the first-instance court, in so far as that court had also awarded pecuniary damage. It considered that that court should have awarded compensation without prejudice to the pecuniary damage due in accordance with the relevant law (Article 12 § 3 of the Ordinance, specifically interest of 5% on the value of the property). Thus, without prejudice to any such claim for pecuniary compensation in respect of the property taken and the relative interest, the Constitutional Court awarded EUR 10,000 in non-�pecuniary damages for the violation suffered, bearing in mind that the value of the property was EUR 13,000, and it annulled the return order for the property.

C. Events following communication of the application

21. As the applicants refused to collect the award made by the Constitutional Court, in January 2014 the Commissioner deposited the award in court by means of a schedule of deposit.

22. On 3 September 2015 the Government sent the applicants a letter reminding them to send evidence concerning their title in connection with the President-�s declaration of 6 October 2010.

II. RELEVANT DOMESTIC LAW

23. The relevant domestic law concerning the case is set out in Frendo Randon and Others v. Malta (no. 2226/10, §§ 26-27, 22 November 2011).

24. Further, relevant provisions of the Land Acquisition (Public Purposes) Ordinance, Chapter 88 of the Laws of Malta, which has now been repealed, read at the relevant time as follows:

Article 6 (as amended by XXI. 2009.4)

-�(1) Without prejudice to the provisions of subarticle (2), no person shall require any proof of the public purpose referred to in articles 3 and 4 and in article 8(1) other than the declaration of the President of Malta.

(2) Any person who has an interest in land, in respect of which a declaration of the President as is referred to in subarticle (1) is made, may contest the public purpose of the said declaration before the Land Arbitration Board by means of an application to be filed in the registry of the said Board within twenty-one days from the publication of the said declaration and the provisions of the Code of Organization and Civil Procedure applicable to the hearing of causes before the Civil Court, First Hall, including the provisions regarding appeals from such decisions, shall, mutatis mutandis, apply to the determination of the said application: Provided that the filing of an application in terms of this subarticle shall not hinder the continuance of the expropriation proceedings or the doing of anything that may be done in respect of the land as provided in this Ordinance during the time when the application is still not determined, without prejudice to the right of the applicant to seek compensation in the event that the declaration of the President is found to be without public purpose.-�

Article 18A

-�Notwithstanding the provisions of this or any other law, the value of any land -�

(a) still in the course of acquisition on the 1st January 2005;

(b) in respect of which a declaration under article 3 was issued before the 5th March 2003, and

(c) in respect of which a notice to treat was not issued before the 1st January 2005 under the provisions of this Ordinance as in force before the date mentioned in this paragraph, shall, saving any interests due until payment is made under article 12(3), be its value as on the 1st January 2005.-�

Article 22

-�(1) If the competent authority and the owner agree as to the amount of compensation for any land, the Board, on the application of any one of the parties, shall make an order carrying the agreement into effect:

Provided that the amount of acquisition rent or recognition in rent, as the case may be, shall be determined in terms of the relevant provisions of article 27.

(2) Where the land is to be acquired by the absolute purchase thereof (including the acquisition by conversion from possession and use or public tenure into absolute ownership), the President-�s Declaration issued for the purposes of article 3, shall state the amount of compensation which the competent authority is willing to pay for the land to which the declaration refers. The Declaration shall have attached with it a valuation drawn up by an architect and where available a site plan of the land described in the Declaration.

(3) Within fifteen working days from the publication of the President-�s Declaration as is referred to in subarticle (2) in the Gazette the Government shall deposit in an interest bearing bank account (which will guarantee a minimum of interest per annum as the Minister responsible for lands may by regulation under this subarticle prescribe) a sum equal to the amount of compensation offered in the President-�s Declaration. Such sum shall be freely withdrawn together with any interests accrued thereon by the person or persons entitled to such compensation upon evidence to the entitlement thereto, in a manner satisfactory to the competent authority:

Provided that in cases where the President-�s Declaration refers to the acquisition by conversion from possession and use or public tenure into absolute ownership, the government shall not be bound by the time-limit established in this subarticle with respect to the deposit of a sum equal to the amount of compensation offered in the President-�s Declaration, and may deposit such amount any time thereafter; and in such cases simple interest at the rate of five per centum per annum shall be paid annually on the sum declared in the President-�s Declaration up to the date of the eventual deposit in the Bank:

Provided further that in such cases, any proceeds from the sale, alienation or the creation of any real and personal right on such land, and any proceeds from any rent or other annual payment over such land, shall be retained by the Commissioner for Land and reserved for the payment to the rightful owners of the sum and interests referred to in the previous proviso and only such proceeds or payments in excess of such sum shall be transferred to and received by the Consolidated Fund.

(4) The competent authority shall signify its acceptance or otherwise of the evidence submitted by the persons referred to in the immediately preceding subarticle, by means of a judicial act within two months from the submission of such evidence.

(5) The amount deposited as provided in subarticle (3) together with any interests accruing thereon may be withdrawn as provided in the said subarticle whether or not the sum deposited as compensation has been accepted as the amount of compensation due, and the withdrawal of such deposit interests shall not prejudice the right competent to any person to take action according to this Ordinance for the purpose of determining any further compensation that may be payable to him in accordance with this Ordinance.

(6) Where the person entitled to compensation does not accept that the amount deposited is adequate, such person may apply to the Board for the determination of the compensation in accordance with the provisions of this Ordinance. Such application shall, on pain of nullity, state the compensation that in the opinion of the applicant is due.

(7) Such application shall be filed in the Registry of the Board within twenty one days from the notification of the judicial act by the competent authority accepting proof of evidence in accordance with subarticle (4). The Board shall determine such compensation and shall give all necessary orders and directives in accordance with this Ordinance ...-�

THE LAW

I. ALLEGED VIOLATION OF ARTICLE 1 OF PROTOCOL No. 1 TO THE CONVENTION

25. The applicants complained under Article 1 of Protocol No. 1 to the Convention that the deprivation of their property, which had originally been in the public interest, had no longer been so after the changes to the site plans in 1972. They further complained that they had not received any compensation to date for the taking. Relying on Article 6, they also complained that they had no remedy allowing them to contest the legitimacy of the President-�s declaration or through which they could claim compensation, despite the inordinate delay in payment. They lastly also complained about the 2006 amendments to the relevant law, which provided for payments to be tied to January 2005 values, apportionment of costs to the detriment of applicants and a prejudicial calculation of interest. The Court considers that the complaint under Article 6 is absorbed by the assessment under Article 1 of Protocol No. 1. The Court will therefore only examine the latter provision, which reads as follows:

Article 1 of Protocol No. 1

-�Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law.

The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties.-�

A. Admissibility

1. Applicability of the provision

26. While the Government have not explicitly claimed that the applicants did not have a possession within the meaning of Article 1 of Protocol No. 1, in so far as it transpires from the Government-�s letter of 2015 (see paragraph 22 above) as well as their later submissions, that the applicants had not yet shown that they had title to the property the Court considers it opportune to note the following:

27. The applicants instituted proceedings before the constitutional jurisdictions at first and second instance. Those courts did not see any obstacle to the applicants bringing their claims, which were moreover allowed. Indeed, the Constitutional Court awarded the applicants (as persons having title to the land) compensation for non-pecuniary damage resulting from the violations they had suffered. While the Government noted that persons had to prove their title before a notice to treat or judicial letter could be issued (see paragraph 40 below), the Court notes that not only were the applicants sent the relevant letter in 2015, but a part of the property expropriated had also been returned to their predecessors in title in 1988 (see paragraph 9 above). In the Court-�s view, these facts indicate that the applicants have been at least tacitly acknowledged as having title to the land by both the authorities and the domestic courts. Moreover, it has not been contested that the applicants were the rightful heirs of their ancestors, as also evidenced by documents submitted to the Court which have not been contested by the Government. This is sufficient to conclude that the applicants had title to the land in question and thus had a possession for the purposes of the relevant provision.

2. Victim Status and temporal jurisdiction

28. The Government submitted that the applicants had lost their victim status following the Constitutional Court judgment which found a violation of Article 6 of the Convention and Article 1 of Protocol No. 1 to the Convention, which in their view the latter court had been examining together, and owing to its award of compensation which covered the period from 1967-�2010. The Government noted that no consideration had to be given to the time prior to 1967 before the Convention had become applicable to Malta; and that since a new declaration had been issued in 2010 the value of the property had to be taken to be that in 2005 in accordance with the law (see paragraph 24 above). Moreover, since 2010 the applicants had been able to challenge the public interest of the declaration issued in 2010 by means of Article 6 § 2 of Chapter 88 as well as the compensation offered by means of Article 22 of Chapter 88 (see paragraph 24 above). Thus, the Constitutional Court had not needed to order the Commissioner to institute proceedings, unlike what the Court had pronounced in Curmi v. Malta (no. 2243/10, § 53, 22 November 2011).

29. The applicants submitted that they were still victims because the Constitutional Court had found a violation of their rights only under Article 1 of Protocol No.1, but not under Article 6. Moreover, despite the meagre amount of non-pecuniary damage awarded by the Constitutional Court they had not been awarded any pecuniary damage for the loss of their property, specifically the loss of forty-�five years of rent. They referred to a valuation by an architect which had estimated the rental value of the property for the period 1970-�2015 as being EUR 76,750.

30. The Court notes that the deprivation in the present case occurred in 1965; however, although a deprivation of an individual-�s home or property is in principle an instantaneous act and does not produce a continuing situation of -�deprivation-� in respect of the rights concerned (see, inter alia, Malhous v. the Czech Republic (dec.) [GC], no.33071/96 ECHR 2000-XII, and Blečić v. Croatia [GC], no. 59532/00, § 86, ECHR 2006-�III), in the present case the applicants-� complaint extends to the failure to pay them final compensation. Thus, the Court is empowered to examine the latter matter (see Almeida Garrett, Mascarenhas Falcão and Others v. Portugal, nos. 29813/96 and 30229/96, § 43, ECHR 2000-�I, and Vajagić v. Croatia, no. 30431/03, § 23, 20 July 2006). The Court further notes that as Malta ratified the Convention on 23 January 1967 (including Protocol No. 1), the Court is competent ratione temporis to examine complaints in so far as they relate to events which took place from 23 January 1967 onwards (see Bezzina Wettinger and Others v. Malta, no. 15091/06, § 54, 8 April 2008, and Azzopardi v. Malta, no. 28177/12, § 32, 6 November 2014).

31. The Court therefore upholds the Government-�s objection in respect of the period until 23 January 1967, and dismisses it for the period after that date.

32. The Court further considers that the question of the applicants-� victim status as argued by the Government should be joined to the merits, since it is closely linked to the substance of the applicants-� complaints.

3. Conclusion

33. The Court notes that the application in so far as it refers to the period after 23 January 1967 is not manifestly ill-founded within the meaning of Article 35 § 3 (a) of the Convention. It further notes that it is not inadmissible on any other grounds. It must therefore be declared admissible.

B. Merits

1. The parties-� submissions

(a) The applicants

34. The applicants acknowledged that the expropriation had been lawful, but contested that it had been carried out in the public interest. They noted that prior to the expropriation they themselves had been renting out the property to a third person as a snack bar, thus the same service had been offered and there had been no need for the Government to expropriate it without paying compensation, to destroy the snack bar and rebuild it to lease it out itself. Moreover, unlike in the Abdilla case (Abdilla v. Malta (dec.) no. 38244/05, 3 November 2005), the service to the relatively small community (even more after 2011 when the terminus was removed) was already being provided by a number of other catering establishments in the vicinity. In any event even if the Court were to find that the measure had been in the public interest, the running of a snack bar was surely not a measure of economic reform or one undertaken to achieve greater social justice which would allow the State to compensate at less than market value.

35. As to the compensation, the applicants noted that not only had they not been offered any compensation for several years, but that the value of the compensation eventually offered had reflected 2005 values. Moreover, that offer had been made only forty-five years after the taking and pending the constitutional redress proceedings. Concerning the compensation offered, the applicants submitted that while they had limited title, had their property not been expropriated, they could have redeemed the ground rent and become full owners. Moreover the fact that their title was not permanent did not mean that their right to rent out the property from 1967 to 2047 could go uncompensated. In their view the offer eventually made had not constituted fair market value.

36. The applicants further submitted that access to court only after forty-�five years was not in compliance with Article 6. Moreover, they claimed (in their observations of November 2015) that they had not yet received a notice to treat enabling them to receive or contest the compensation. Furthermore, in reference to the Government-�s reliance on Article 1078 of the Civil Code (see paragraph 40 below), the applicants considered that the latter provision did not apply in their case, and in any event it had been found not to be an adequate remedy by the Court in Vassallo v. Malta (no. 57862/09, 11 October 2011). Furthermore, at the time of the original taking they had not been able to contest the public interest in the measure, and it could not be said that an extraordinary remedy, like the constitutional jurisdictions whereby they could complain of a violation of their Convention rights, had been the access to court required as a first step to obtain compensation. Moreover, the State should have offered compensation in the first place; it should not have been for the applicants to have had to undertake proceedings to obtain it, something which they eventually had had to do. In consequence the applicants had not had access to court as required by the Convention.

(b) The Government

37. The Government submitted that the expropriation had been provided for by Chapter 88 of the Laws of Malta and had therefore been lawful.

38. The Government also considered that the expropriation had been in the public interest as the property had been expropriated in 1965 for the purposes of constructing a road to service a new civic centre and bus terminus; in 1972, following a change to the plans, it had been used to build amenities - in particular a shop had been built partly on the applicants-� land and partly on other land owned by the Government -� to the benefit of bus drivers, commuters and residents of the area. It was thus irrelevant that the property had been allocated to a private third party. They relied on Abdilla (cited above) and Frendo Randon and Others (no. 2226/10, 22 November 2011), as well as the findings of the Constitutional Court in the present case. They further noted that the Government-�s plans had been part of a wider project for the regeneration of the south of Malta. In reply to the applicant-�s argument that they themselves had been offering the service, the Government noted that they could not have relied on that state of affairs as the applicants could have changed its nature.

39. As to proportionality, the Government referred to the findings of the Constitutional Court which were relevant for the period 1967-�2010. As to the amount of compensation offered by the Commissioner, the Government noted that EUR 13,000 for a plot of land measuring 57.34 sq. m had been fair compensation given that the applicants-� right to the land had been limited both in title and duration. Indeed the applicants had not been the owners but had solely held title to the land on the basis of a temporary emphyteusis which was to terminate in 2047. Moreover the compensation had been calculated according to the relevant guidelines and had reflected the market value. However, without prejudice to the latter statement, even if it had not, the Convention allowed for compensation to be lower than market value if it pursued the public interest.

40. For the purposes of Article 6 the Government considered that the applicants could have challenged the compensation offered in connection with the 1965 declaration by means of an ordinary civil case under Article 1078 of the Civil Code (see paragraph 23 above), requesting that the ordinary courts give the Commissioner a period of time within which to institute proceedings before the LAB, and as of 1987 they could have contested the public interest before the constitutional jurisdictions. Nevertheless the applicants had undertaken constitutional redress proceedings only in 2010 and thus had not actively pursued their rights. In any event the situation had changed because of the 2010 declaration and the applicants had thus had access to a court thereon. However, they did not institute such proceedings. In reply to the applicant-�s submission concerning the fact that they had not yet received a notice to treat, the Government referred to the letter sent to the applicants in 2015 (see paragraph 22 above) in which they were requested to produce evidence of their title in order to be offered compensation. The Government also explained that after 2010, they would be sent a judicial letter and not a notice to treat, unlike the latter, which put the obligation to institute compensation proceedings on the Commissioner of Land, the former put such an obligation on the owners. In the present case the applicants had made things difficult since they had not complied with the request to prove title.

2. The Court-�s assessment

41. An interference with the peaceful enjoyment of possessions must strike a fair balance between the demands of the general interest of the community and the requirements of the protection of the individual-�s fundamental rights. The concern to achieve this balance is reflected in the structure of Article 1 of Protocol No. 1 as a whole, including therefore the second sentence, which is to be read in the light of the general principle enunciated in the first sentence. In particular, there must be a reasonable relationship of proportionality between the means employed and the aim sought to be realised by any measure depriving a person of his possessions (see Former King of Greece and Others v. Greece [GC], no. 25701/94, § 89, ECHR 2000-�XII).

42. Compensation terms under the relevant legislation are material to the assessment whether the contested measure respects the requisite fair balance and, notably, whether it imposes a disproportionate burden on the applicants. In this connection, the Court has already found that the taking of property without payment of an amount reasonably related to its value will normally constitute a disproportionate interference and a total lack of compensation can be considered justifiable under Article 1 of Protocol No. 1 only in exceptional circumstances (see Frendo Randon and Others v. Malta, cited above, § 54). The Court reiterates, however, that the adequacy of the compensation would be diminished if it were to be paid without reference to various circumstances liable to reduce its value, such as unreasonable delay. Abnormally lengthy delays in the payment of compensation for expropriation lead to increased financial loss for the person whose land has been expropriated, putting him in a position of uncertainty (see Akkuş v. Turkey, 9 July 1997, § 29, Reports of Judgments and Decisions 1997-IV). The same applies to abnormally lengthy delays in administrative or judicial proceedings in which such compensation is determined, especially when people whose land has been expropriated are obliged to resort to such proceedings in order to obtain the compensation to which they are entitled (see Aka v. Turkey, 23 September 1998, § 49, Reports 1998 -� VI).

43. The Court notes that in the present case the applicants have never received any compensation for the taking of the property in 1965, despite an offer of EUR 13,000 which was made in 2010. In particular it took forty-�five years for the Commissioner to make such an offer, time during which the applicants had no possibility of initiating proceedings, as a result of which they remained without compensation. In the Court-�s view, the Government have not provided any convincing justification for the failure of the authorities to pay such compensation to the applicants over time. In so far as the Government relied on Article 1078 of the Civil Code (see paragraph 40 above), the Court notes that according to the Land Acquisition (Public Purposes) Ordinance, at the relevant time, it was up to the authorities to initiate the relevant compensation proceedings (see Frendo Randon and Others, cited above, § 65). Moreover, whatever the effectiveness of an action under the Civil Code might be, the Court reiterates that owners could not be expected to incur the expense and burden of instituting proceedings to ensure the authorities-� fulfilment of their legal obligation (ibid.).

44. The Court is of the opinion that quite apart from the adequacy or not of the offer (also in the light of the delay in payment and the extent of the public interest involved) the above delay in the payment of compensation as a result of which the applicants are still without any compensation five decades after the taking, falls foul of the requirements of Article 1 of Protocol No. 1 to the Convention.

45. The Court further notes that, despite the explicit finding of a violation of Article 1 of Protocol No. 1 as a result of the fact that the applicants had been deprived of their property for a number of years without any compensation, the Constitutional Court failed to determine the amount of pecuniary compensation due and awarded solely non-pecuniary damage, expecting the applicants to start compensation proceedings forty five-�years after the taking.

46. Under these circumstances, the Court is of the view that the redress provided by the Constitutional Court did not offer sufficient relief to the applicants, who continued to suffer the consequences of the breach of their rights (see, mutatis mutandis, Frendo Randon and Others, cited above, §§ 37 and 39).

47. The Court therefore dismisses the Government-�s objection concerning the lack of victim status and considers that the failure to pay any compensation for the taking of the applicants-� possessions upset, to their detriment, the fair balance that has to be struck between the protection of property and the requirements of the general interest. Accordingly, there has been a violation of Article 1 of Protocol No. 1.

II. APPLICATION OF ARTICLE 41 OF THE CONVENTION

48. Article 41 of the Convention provides:

-�If the Court finds that there has been a violation of the Convention or the Protocols thereto, and if the internal law of the High Contracting Party concerned allows only partial reparation to be made, the Court shall, if necessary, afford just satisfaction to the injured party.-�

A. Damage

49. The applicants claimed 76,750 euros (EUR) in respect of pecuniary damage reflecting the amount of rent the property (the shop in its original state, that is to say with an area of 35 sq. m with 3 m. frontage on the square) would have fetched on an open market for the years 1970-�2015 according to an architect-�s estimate submitted to the Court. The report states that the rent would have been as follows:

-�1970-80 - ten years at EUR 585 per annum

1980-90 - ten years at EUR 930 per annum

1990-2000 - ten years at EUR 1,400 per annum

2000-10 - ten years at EUR 2,910 per annum

2010-15 - five years at EUR 3,700 per annum-�

In this connection the applicants noted that, according to documents submitted to the Court, the Government was currently leasing the property to a third person at an annual rent of -�EUR 2,500-�. The applicants also claimed, without specifying an amount, loss of future rent in line with rising prices since their contract was meant to expire in 2047. The applicants further claimed EUR 5,000 each in respect of non-pecuniary damage, to be added to the EUR 10,000 jointly awarded by the Constitutional Court, which had to be divided by six.

50. The Government considered that the applicants should not be awarded more than the EUR 13,000 offered to them by the Commissioner. They further considered that the rental valuation submitted by the applicants was excessive and submitted a counter valuation by their own ex parte architect, which estimated the total rent for the relevant period to be EUR 64,500, as follows:

-�1970-80 - at EUR 350 per annum

1980-90 - at EUR 800 per annum

1990-2000 - at EUR 1,400 per annum

2000-10 - at EUR 2,500 per annum

2010-15 - at EUR 3,200 per annum-�

The Government also noted that the applicants should not be awarded the market value given that the taking had been lawful and in the public interest. Moreover the applicants will be paid interest of 5% on the compensation offered domestically from the day of the taking of the property. They argued however that the applicants should not be awarded compensation for loss of rent, but only for the value of the property expropriated. The Government further argued that the applicants had already been awarded non-�pecuniary damage by the Constitutional Court, thus no further award was called for under this head.

51. The Court considers that in view of the fact that the payment of compensation has not come to be after more than fifty years from the taking it would be unreasonable to wait for the outcome of any further domestic proceedings (see, mutatis mutandis, Frendo Randon and Others, cited above, § 77; Azzopardi, cited above, § 64, Serrilli v. Italy (just satisfaction), no. 77822/01, § 17, 17 July 2008, and Mason and Others v. Italy (just satisfaction), no. 43663/98, § 31, 24 July 2007).

52. In connection with the Government-�s argument concerning diminution of compensation in the light of the public-interest requirement, the Court reiterates that legitimate objectives in the -�public interest-�, such as those pursued in measures of economic reform or measures designed to achieve greater social justice, may call for less than reimbursement of the full market value, but a total lack of compensation can be considered justifiable under Article 1 of Protocol No. 1 only in exceptional circumstances (see James and Others v. the United Kingdom, 21 February 1986, Series A no. 98, § 54; Jahn and Others v. Germany [GC], nos. 46720/99 and 2 others, § 94, ECHR 2005-�VI; and Ghigo v. Malta (just satisfaction), no. 31122/05, § 18, 17 July 2008). The Court further reiterates that while deprivation of property effected for no reason other than to confer a private benefit on a private party cannot be -�in the public interest-�, the compulsory transfer of property from one individual to another may, depending on the circumstances, constitute a legitimate means of promoting the public interest (see James and Others, cited above, § 40, Series A no. 98). Moreover, the taking of property effected in pursuance of legitimate social, economic or other policies may be in -�in the public interest-�, even if the community at large has no direct use or enjoyment of the property taken (ibid., § 45).

53. In this connection the Court cannot but note that the property was originally taken to build a road in the ambit of a reconstruction project, it was nevertheless ultimately used only for the purpose for which it had already been used prior to the taking, namely a commercial entity in the form of a snack bar, rented out to the same tenant who had held the lease before the property was expropriated. In the circumstances of the present case, the Court considers that, given the use made of the property after 1972, a reduction in the amount of compensation is not warranted and that the applicants are entitled to compensation representing the value of the land at the time of the taking, converted to the current value to offset the effects of inflation, plus simple statutory interest applied to the capital progressively adjusted (see Frendo Randon and Others v. Malta (just satisfaction), no. 2226/10, § 20, 9 July 2013 and Schembri and Others v. Malta (just satisfaction), no. 42583/06, § 18, 28 September 2010) and further adjusted to the title held by them (see, by implication, Azzopardi, cited above, §§ 20 and 69, where the Court-�s calculation was based on the LAB-�s evaluation of the utile dominium of the land). In this connection the Court reiterates that the applicants are not the owners of the land but are the holders of the utile dominium of the land by way of sub-emphyteusis which expires in 2047. The Court further notes that on the one hand the applicants have not submitted any valuation as to the sale value of the land, relying solely on rental values; on the other hand the Government reiterated that the value of the utile dominium of the land in 2005 had been EUR 13,000, on which the applicants were also due interest at 5% in accordance with domestic law, and also submitted the levels of rent applicable according to their expert. The Court considers that rental values provide an indication of the value of the land. However, it also notes that the property was rebuilt by the Government around thirty years ago. Thus the rental values of subsequent years have definitely benefitted from the amelioration of the said property. Furthermore, in assessing the amount due to the applicants the Court has, as far as appropriate, considered information available to it on land values on the Maltese property market today (see, for example, Vassallo v. Malta (just satisfaction), no. 57862/09, § 21, 6 November 2012).

54. Lastly, the Court notes that it has previously found the average statutory rate over the relevant period to be 5% (see Frendo Randon and Others (just satisfaction) and Schembri (just satisfaction), both cited above, §§ 25 and 18 respectively) and sees no reason to depart from it.

55. In line with the above, the Court awards the applicants, jointly, EUR 21,000 which sum is awarded over and above the sum of EUR 13,000 plus interest deposited with the domestic courts, which the applicants should be able to withdraw.

56. Bearing in mind the award of EUR 10,000 granted by the domestic courts the Court does not find it necessary to make an award in respect of non-pecuniary damage.

B. Costs and expenses

57. The applicants also claimed EUR 1,539.21 (as per taxed bill of costs) for the costs and expenses incurred before the Constitutional Court and EUR 3,000 for those incurred before the Court.

58. The Government submitted that the applicants had not proven that the domestic court fees had been paid.

59. According to the Court-�s case-law, an applicant is entitled to the reimbursement of costs and expenses only in so far as it has been shown that these have been actually and necessarily incurred and are reasonable as to quantum. In the present case, regard being had to the documents in its possession and the above criteria, as well as the fact that outstanding domestic court expenses remain payable, the Court considers it reasonable to award the sum of EUR 4,000 covering costs under all heads.

C. Default interest

60. The Court considers it appropriate that the default interest rate should be based on the marginal lending rate of the European Central Bank, to which should be added three percentage points.

FOR THESE REASONS, THE COURT, UNANIMOUSLY,

1. Decides to join to the merits the Government-�s objection concerning the applicants-� lack of victim status and dismisses it after considering the merits.

2. Declares the application admissible in so far as it refers to the period after 23 January 1967;

3. Holds that there has been a violation of Article 1 of Protocol No. 1 to the Convention;

4. Holds

(a) that the respondent State is to pay the applicants, within three months from the date on which the judgment becomes final in accordance with Article 44 § 2 of the Convention, the following amounts:

(i) EUR 21,000 (twenty-one thousand euros), plus any tax that may be chargeable, in respect of pecuniary damage;

(ii) EUR 4,000 (four thousand euros), plus any tax that may be chargeable to the applicants, in respect of costs and expenses;

(b) that from the expiry of the above-mentioned three months until settlement simple interest shall be payable on the above amounts at a rate equal to the marginal lending rate of the European Central Bank during the default period plus three percentage points;

5. Dismisses the remainder of the applicants-� claim for just satisfaction.

Done in English, and notified in writing on 13 February 2018, pursuant to Rule 77 §§ 2 and 3 of the Rules of Court.

Marialena TsirliGanna Yudkivska
RegistrarPresident

APPENDIX

1.     Miriam GALEA is a Maltese national who was born in 1946 and lives in Zabbar.
2.     Grace BORG is a Maltese national who was born in 1950 and lives in Zabbar.
3.     Emanuel CASSAR is a Maltese national who was born in 1953 and lives in Marsaskala.
4.     Joseph CASSAR is a Maltese national who was born in 1947 and lives in Zabbar.
5.     Annemarie DESPOTT is a Maltese national who was born in 1981 and lives in Zabbar.
6.     Carmen ZAMMIT is a Maltese national who was born in 1943 and lives in Zabbar.