Scheduling of land and compensation (Malta, Constitutional Court)
Written by Ivan Mifsud Saturday, 22 May 2010 03:36 Last Updated on Saturday, 22 May 2010 05:38
14 May 2010, Valletta (Ref Appell Civili Nru 14/2005/1) The Constitutional Court partially overturned a judgement of the Civil Court in its constitutional jurisdiction. Proceedings were instituted by a land owner whose property was scheduled and designated as a 'green area'. At first instance, the court had dismissed a claim of unjust discrimination but ruled that when land was scheduled, its owner was entitled to compensation.
Court proceedings were instituted by a limited liability company that had bought a parcel of land back in the late 1980s for a sum of money which the Constitutional Court considered to be mere speculation and not reflecting the true value of the land. This parcel of land was designated as a ‘White Area’ according to the Temporary Local Plans of 1988. In due course, when the new local plan for the area was drawn up, it was classified as a ‘Green Area’.
In a ‘white area’ some development is possible, as opposed to a ‘building zone’, but in a ‘green area’ the land cannot be developed. The plaintiff company claimed that this scheduling amounted to a de facto expropriation without compensation and breach of its right to enjoyment of property. It also claimed that with buildings very close to it, the designation of the land as a ‘green area’ amounted to unjust discrimination when compared with that land on which permits to build were granted.
After citing the definition of discrimination provided in Spadea v Italy, para 45, and Rasmussen v. Denmark the Court dismissed the claim of unjust discrimination, because no evidence was brought that permits to build were issued after the land was designated as a ‘green area’. The Constitutional Court confirmed.
The court at first instance also held that scheduling of property amounted to a breach of property rights because no allowance was made for the payment of adequate compensation to the land owners. The Constitutional Court on the other hand ruled that no evidence was brought to indicate that the scheduling of land was not done in the public interest. However, even according to the proviso to Protocol 1, art. 1, the State retains the right, and enjoys a wide discretion in the regulation of land use. Contrary to what the first court indicated, not every case of scheduling of property merited compensation. To the contrary, compensation in such circumstances should be the exception, not the rule, when the desired balance between the general interest and that of the individual is breached, and the individual is made to shoulder a disproportionate burden. This could occur, for example, when a land owner is given permission to build on his land, and while digging for the foundations it turns out that there are important archaeological remains that have to be conserved, so the building permit is forfeited and the land scheduled for preservation purposes.
The Constitutional Court also pointed out that the land was bought for speculation, because it was surrounded by buildings, and the company felt that it had a good chance to acquire building permits. It bought uncertainty, and for this risk had to bear the consequences.
To read the judgement click here
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