Yolanda Carabott

vs

Pauline Calamatta, Carmelo Calamatta and Yvette Bonnici

First Hall, Civil Court

Judge Abigail Lofaro

10 June 2008

This case concerned a claim for the revocation of a contract that was allegedly vitiated by fraud. The plaintiff passed away during the course of proceedings and was replaced by Mary Anne Darmenia.

Yolanda Carabott had left her residence of about 50 years due to health problems and also since she had nobody to look after her and moved in with the Darmenia family. While she was still residing in her house, the plaintiff had given her power of attorney to the defendant Pauline Calamatta enabling the latter, among other things, to cash her social security cheques and also gave her certain things including gold objects to look after. Upon moving, the plaintiff had requested the defendant to allow the cancellation of the power of attorney and also to return her belongings that she had given her.

It transpired that the defendant, without being authorised, proceeded to transfer the plaintiff’s house onto her own name and her husband’s name claiming that such a transfer was done in consideration for services rendered in favour of the plaintiff by the defendant, which incidentally never actually took place. The plaintiff’s consent that was obtained to allow such a transfer was vitiated by fraud and misrepresentation.

The plaintiff provided evidence that this transfer took place after she had requested the defendant to appear for the cancellation of the power of attorney.

The plaintiff requested the court to declare:

• That her consent was obtained fraudulently and that the contract of transfer of the property lacked consideration since there were in fact never any services rendered in her favour;

• A breach of Article 1368 of the Civil Code which restrains certain persons from buying property: “The sale, however, made, either directly or through intermediaries, to tutors or curators in regard to property belonging to the persons under their tutorship or curatorship, or to agents in regard to property which they are authorised to sell is null, even though such sale was made by judicial auction.”

• Rescind the contract effecting the disputed transfer of property.

The defendants inter alia held that:

• The plaintiff’s claims were unfounded in fact and in law;

• The plaintiff’s consent was not vitiated by fraud;

• Services were indeed rendered in the plaintiff’s favour who was thus due Lm16,900 for such services;

• Article 1368 was inapplicable to the transfer in question.

The court took into consideration all the evidence as revealed by witnesses. The plaintiff lived alone after her brother died in 1986. The defendant was in fact her neighbour’s daughter who offered to buy her groceries and cash her social security cheques. The defendant promised that she would keep helping out the plaintiff in this manner.

The plaintiff therefore decided to write her will, leaving the defendant her property in return for her help. However, the plaintiff told the court that once she had done this, she expected more of an interest from the defendant who visited her occasionally. Furthermore, the plaintiff claimed that when the defendant cashed her cheques, she would give her about Lm5 to Lm10 as compensation. When the plaintiff needed eyes drops to be applied, it was another woman Rose Tabone who visited the plaintiff to help her out. After this, Ms Tabone visited the plaintiff every week. The plaintiff also claimed that her savings were withdrawn from her bank account without her authorisation.

The court considered that the vital conditions essential to the validity of a contract as established by Article 966 of the Civil Code are:

• Capacity of the parties to contract;

• The consent of the party who binds himself;

• A certain thing which constitutes the subject-matter of the contract;

• A lawful consideration.

The court recognised that the plaintiff’s claims were based on Article 1212 of the Code which holds that “Any agreement which is defective by reason of the absence of any of the conditions essential to the validity of contracts, or which is expressly declared by law to be null, shall be subject to rescission.”

Furthermore, Article 981 dealing with fraud states:

“(1) Fraud shall be a cause of nullity of the agreement when the artifices practised by one of the parties were such that without them the other party would not have contracted.

(2) Fraud is not presumed but must be proved.”

With reference to the above-claimed Article 1368, the court held that the Article only applied to tutorship and curatorship and not to this case that was essentially a mandate and therefore falling under the Civil Code rules on mandate found under Article 1856 to Article 1890. The court considered that had the case occurred before 2004, the new provisions on fiduciary obligations found in the Civil Code would have been applicable. However, the court held that still, in accordance with Article 1132 of the Civil Code, “...the degree of diligence to be exercised in the performance of an obligation, whether the object thereof is the benefit of only one of the parties, or of both, is, in all cases, that of a bonus paterfamilias...”

The court held that it was clear that the plaintiff’s intention upon granting her power of attorney was surely not to allow the defendant to dispose of her property. In fact, upon finding out about the disputed contract, the plaintiff changed her will and requested that the defendant appear to cancel her power of attorney.

The court decided in favour of the plaintiff (now deceased), holding that it was clear that her consent was vitiated by fraud and that the defendant had essentially abused of her position by transferring the plaintiff’s property in her favour. The court ordered that the disputed contract be revoked. This case may be the subject of an appeal.