Reserved portion paid in cash is valued near judgment

The Court of Appeal (Superior Jurisdiction) held on 8 June 2026 that when a reserved portion is paid in money rather than in property, it must be valued as close as possible to the date of judgment. Chief Justice Mark Chetcuti, Mr Justice Anthony Ellul and Mr Justice Robert G. Mangion allowed that ground of the plaintiffs' appeal. The court ordered payments of €155,294.89 and €155,760.69 in a case filed in October 1965.

The facts

In B.E. vs S.R., two of six siblings sued the other four for their reserved portion, the share of a parent's estate that the law keeps for children, known as the leġittima. Their parents died in Gozo in the 1940s and 1960s. Their wills named no heirs and left only legacies, so the estates passed under the rules of intestate succession.

The plaintiffs renounced the inheritance and asked the court to liquidate the community of acquests, each parent's separate estate and their reserved portions. Over six decades most of the original parties died, and their heirs took over the case.

On 12 December 2018 the Court of Magistrates (Gozo), Superior Jurisdiction, awarded the portions in money. It valued them at the dates the successions opened, which gave each plaintiff about €1,000 in total, with 8% interest from those dates. Both sides appealed.

What the court held

The plaintiffs argued that the portion had to be given in kind, from the land itself. The court disagreed. Over more than 50 years the boundaries had changed, third parties and the defendants' descendants occupied the land, and its value far exceeded the portions.

The court held that the first court used its discretion fairly: “kien ikun inutili u superfluwu illi tingħata sentenza fejn il-leġittima spettanti lill-atturi kienet waħda in natura” (it would have been useless and superfluous to give a judgment awarding the plaintiffs their portion in kind). Such a judgment would only have led to further proceedings.

On valuation, the court adopted the reasoning of the First Hall of the Civil Court (12 October 2007). The first step, the fictitious reunion of the estate, tests whether the deceased gave away more than the disposable portion. That step uses values at the opening of the succession, and the first court applied it correctly.

Once the portion is converted into a money credit, however, its value must be fixed at the time of conversion, as close as possible to judgment. The first court had used the old values for payment too. The court held that the plaintiffs were right on this point.

The court used the 2018 values of the court-appointed architect. Because about eight years had passed since that valuation, it added 10% to the value of each estate. In view of that increase, it removed the 8% interest the first court had awarded.

The defendants' incidental appeal succeeded in part. The court accepted proof that several plots did not belong to the estates and took them out. Under article 620(4) of the Civil Code (Chapter 16 of the Laws of Malta), it deducted from one plaintiff's portion the dowry she had received, as property subject to collation.

Under article 616, the children's reserved portion was half of each estate, shared equally, so each plaintiff took one-twelfth. The court also added a one-twelfth share in compensation for expropriated land, whose value is not yet known.

On costs, the court applied article 223 of the Code of Organization and Civil Procedure (Chapter 12). Both sides had contributed to the delay, so the plaintiffs bear one-third of the first-instance costs and the defendants two-thirds. The appeal costs were split the same way, and the heirs of the four defendants pay in quarter shares.

Why it matters

A claimant whose reserved portion is paid in money is not held to values from the date of death. Lawyers should ask for a valuation close to judgment, and expect the court to weigh any uplift against interest. A long delay does not freeze the value of the claim.

Where it sits

The 2007 ruling the court adopted describes the reserved portion as a share of the assets due in kind, not a mere credit. It also recognises the court's discretion to order payment in money where division in kind would harm the estate. This judgment applies both points and separates the two valuation dates: death for testing the disposable portion, judgment for payment.

That 2007 ruling drew on a decision of the Court of Appeal (24 February 1930), which held that a testator may reserve particular kinds of assets for the person entitled to the portion. On costs, the court cited the Court of Appeal (16 September 2004).

Source

Court of Appeal, 39/1965/2, 8 June 2026.