Actio surrogatoria pays the debtor, not the creditor

The First Hall of the Civil Court held on 13 April 2026 that a creditor who sues a debtor's debtor under article 1143 of the Civil Code cannot collect the money for itself. Madam Justice Rachel Montebello ordered a driver and his insurer to pay €16,695 in damages to the injured debtor, not to the creditor who brought the case. The court also held that a claim for damages for permanent disability is not a right exclusively personal to the debtor.

The facts

The plaintiff, Z.M., held a final decision of the Rent Regulation Board of 27 June 2013 ordering C.J., who had rented a shop from her, to pay €16,294.96 in rent arrears, utilities and stock. A garnishee order issued in 2015 recovered nothing.

On 17 November 2013 C.J. was a pillion passenger on a motorcycle that collided with a car making a U-turn across a continuous centre line. The Court of Magistrates convicted the car driver on 14 May 2018 of involuntary bodily harm of a grievous nature. C.J. never sued him. In 2020 Z.M. sued the driver, his insurer GasanMamo Insurance Limited and C.J., seeking to exercise C.J.'s right to damages.

What the court held

The court set out the elements of the actio surrogatoria, the indirect action a creditor brings in the debtor's name. The plaintiff must be the debtor's creditor, and that credit must be actual, not conditional or potential. The debtor must have a patrimonial right against a third party and must have failed, through neglect or indifference, to pursue it. The creditor must suffer prejudice from that failure.

Only the creditor's own claim must be certain. The court held that it did not matter that C.J.'s claim against the driver was still unliquidated when the case began. It rejected C.J.'s argument that damages for permanent disability are personal, like maintenance or a claim in separation, divorce or filiation.

On prejudice, the court held that actual insolvency is not required and that a danger of insolvency is enough. C.J.'s own evidence showed limited means, and she had done nothing for seven years to pursue the driver. The court found both inertia and a danger of insolvency proved on a balance of probabilities.

The driver and insurer pleaded two-year prescription under article 2154 of the Civil Code and article 688(e) of the Criminal Code. The court held that the period follows the punishment the law prescribes for the offence, not the punishment the criminal court imposed.

A permanent injury is grievous under article 218 of the Criminal Code, so article 226(1)(a) applies, with imprisonment of up to one year. That falls outside article 688(e). Because a court cannot raise prescription of its own motion under article 2111 of the Civil Code, and no other period was pleaded, the plea failed.

On liability, the court found that the driver's U-turn across the continuous line was the proximate cause. It also found that the motorcyclist had been overtaking a line of slow cars on the wrong side of the road at speed. It split responsibility three-quarters to the driver and one-quarter to the motorcyclist.

The court assessed the disability at 8% and future loss of earnings on €15,000 a year with a multiplier of 20, less an 8% deduction for a lump-sum payment. With €179 in expenses, damages came to €22,260. After the one-quarter reduction, the driver's share was €16,695.

The court then dismissed the claims asking that Z.M. be paid directly from that sum. It held that "l-iskop tal-azzjoni surrogatorja huwa wieħed konservattiv anziche’ wieħed eżekuttiv" (the purpose of the surrogatory action is conservative rather than executive). The money enters the debtor's estate for all her creditors, and the creditor who sued has no priority over it.

The court ordered the driver and insurer jointly to pay the full €16,695 to C.J., with interest from the date of judgment. It found that C.J. had a direct action against the insurer under article 9A(1)(a) of Chapter 104 of the Laws of Malta.

Why it matters

A creditor can unlock a debtor's idle damages claim, but must then enforce against the debtor in the ordinary way, alongside every other creditor. A claim framed to pay the creditor directly will fail on that point.

Defendants pleading prescription in a civil claim for damage caused by a crime must plead the correct period. The court will not substitute the right one for them.

Where it sits

The actio surrogatoria in article 1143 sits beside the actio pauliana in article 1144. Both protect the debtor's estate as the common security of creditors. Article 1143 excludes rights that are exclusively personal. Article 2154 ties prescription of a civil claim for damage caused by a crime to the rules on criminal prescription. Liability for fault rests on articles 1031 to 1033, and the heads of damages on article 1045.

For the elements of the action the court relied on the First Hall of the Civil Court (30 May 2002) and the Court of Magistrates (Gozo), Superior Jurisdiction (7 May 2013). On the creditor's lack of priority it cited HSBC Bank (Malta) plc vs Price Club (Burmarrad) Limited (First Hall, 12 October 2006) and the First Hall (14 December 2012). It also drew on Italian commentary and judgments of the Corte di Cassazione.

On prescription it cited the Court of Appeal (13 March 2009, 27 March 2020 and 20 June 2024) and the Court of Criminal Appeal (13 November 2012). On damages it cited the Court of Appeal (15 June 2023 and 17 October 2024).

Source

First Hall of the Civil Court, 1069/2020, 13 April 2026.