Buyer of a temporary ċens who lives there can stay as tenant

The Court of Appeal (Inferior Jurisdiction) on 22 April 2026 dismissed an appeal by the owners of a house who sought to evict the couple living in it. Mr Justice Lawrence Mintoff held that the husband had bought the remaining years of a temporary emphyteusis, not a sub-emphyteusis. As a Maltese citizen using the house as his ordinary residence, he was entitled to stay on under a lease when the grant ended.

The facts

In M.M. vs C.E., the owners' family granted the house by temporary emphyteusis, or ċens temporanju, for 21 years from 1 November 1985. Temporary emphyteusis is a grant of property for a fixed term in return for ground rent. In October 1995 the original grantee sold the remaining term of about 11 years to C.E., and the grant ended on 31 October 2006.

On 11 June 2007 the parties signed a public deed of lease. The deed stated that they were regulating their position under the Housing (Decontrol) Ordinance (Chapter 158 of the Laws of Malta), in particular article 12(1) and (2). It set no term, and the rent followed the law.

On 30 November 2022 the owners gave notice ending the lease on 1 May 2023. C.E. and his wife stayed, and the owners asked the Rent Regulation Board to declare the lease ended and to order the couple to leave.

On 14 May 2025 the board rejected the claims. It held that C.E. had acquired the protection the law gave the original grantee, and that the 2007 deed was not a novation, the replacement of an old obligation with a new one. The owners therefore could not end the lease under articles 1536 and 1537 of the Civil Code.

What the court held

On appeal, the owners argued for the first time that the 1995 contract was a sub-emphyteusis. They submitted that after Act XXXI of 1995, article 16(3) of Chapter 158 gave no protection to sub-concessions made from 1 June 1995, so the 2007 lease stood on its own.

The court read the 1995 contract and found otherwise. The original grantee appeared as vendor and C.E. as purchaser, and the deed sold the utile dominium, the grantee's right of use and enjoyment, for the remaining period under the original ground rent. No clause gave the vendor an increase on that ground rent that would have made him a sub-grantor.

C.E. paid the laudemium, the fee due on transfer, to the owners' family, and the original grantee kept no residual interest. The contract therefore created a relationship of directus dominus and emphyteuta between the owners and C.E. The provisions the owners relied on did not apply.

What applied was article 12(2)(b) of Chapter 158. Where a dwelling house is granted on temporary emphyteusis by a contract made after 21 June 1979, an emphyteuta who is a Maltese citizen and uses it as an ordinary residence may stay on under a lease when the grant ends. The court held: "Is-sitwazzjoni tal-appellati tinkwadra perfettament f’din id-dispożizzjoni tal-liġi." (The respondents' situation fits this provision of the law perfectly.)

Although no ground of appeal raised it, the court agreed with the board on novation. The notary's evidence and the wording of the 2007 deed showed that the parties only wanted to put their position under Chapter 158 in writing. By signing it, the tenants did not give up the protection the law gave them.

The court dismissed the appeal and ordered the appellants to pay the costs.

Why it matters

Owners of houses once granted on temporary ċens should read the deed that brought the occupier in before treating the occupier as unprotected. A sale of the remaining term passes the grantee's position to the buyer, and the owners' argument about sub-concessions failed because the deed was a sale. A later lease that restates the statutory position will not easily be treated as a new lease that can be ended at will.

Where it sits

The case applies the conversion of a temporary emphyteusis into a lease under article 12 of Chapter 158, and the rule that novation is never presumed. Under the Civil Code, novation extinguishes an obligation (article 1145(b)) and may be tacit but not presumed (article 1180(2)). In case of doubt it is excluded.

The appeal judgment names no authority of its own. The board's judgment, which it reproduces, cited the First Hall of the Civil Court (19 October 2006) and the First Hall of the Civil Court (30 November 2009). Both read "emphyteuta" in article 12(2)(b) as whoever holds the grant when it ends, not only the original grantee.

On novation, the board cited HSBC Bank (Malta) plc vs Pirella Supermarkets Limited (Court of Appeal, 29 April 2016) and the Court of Appeal (Inferior Jurisdiction) (21 April 2021).

Source

Court of Appeal (Inferior Jurisdiction), 196/2023/1, 22 April 2026.