The Malta Independent 19 September 2019, Thursday

The De Paule’s Band Club cannot be saved by a sloppy bill

Simon Mercieca Monday, 18 June 2018, 07:40 Last update: about 2 years ago

I have to admit that I was not expecting such a response to my open letter to the Prime Minister in support of Paola’s De Paule Band Club. There were those who heartily thanked me for championing their cause. There were others who accused me of backing the wrong horse because by helping this band club, government would be discriminating against all other band clubs that have been more pro-active and bought their respective property. They are asking: ‘why did Paola’s De Paule club not do the same and go on to purchase the property?’  I shall attempt here to answer this question.

What has surprised me is that those who already own band club premises ended up passing snide comments on the De Paule Band Club. By so doing, they not only revealed their egoistic streak but what is worse, their comments have no basis whatsoever. In one form or other, all band clubs have benefitted from government aid proffered to them under various guises. Therefore, why should a club now facing problems not seek help from government?  I fail to see how the De Paule Band Club is living off other clubs. When this club is asking for help, it is requesting government to intervene in what is a unique and tricky situation.

As my cousin in Australia has told me, I have ‘really stirred the pot’. As an independent observer of the local band scene, he admitted that this ‘is a very hot potato for government to deal with.’  Now, time is pressing for both the club and government to act on this issue. The deadline is fast closing in and September will soon be with us. Parliament seems to be acting fast. Last week, all MPs approved the second reading of a bill which could be nicknamed ‘To save the De Paule Band Club’.

Nonetheless, I never expected government to come up with such a proposal; a sloppy law, which is not only banal, but extremely dangerous and undemocratic. I fully agree with all those - including the owners of the said property and the Chamber of Advocates – who have declared that this is an unconstitutional law.

Incidentally, the club members are deluding themselves in thinking that there had been a precedent, where a court sentence was annulled through this method. This was about a fireworks factory in Mosta. But till now, no one has challenged this sentence.

The owners of this property have already stated that they are prepared to go to the Constitutional Court and, if need be, even the European Courts of Human Rights to re-possess their property. The owners will win their case and this proposed Bill will be declared unconstitutional. Therefore, all Parliament is doing, is merely offering a temporary solution. What is not being stated is that with this new Bill, the De Paul Band Club will end up in an even worse conundrum than at present.  Once this law is declared null and void, no government will be in a position to act or intervene in the band’s favour.

To further compound the situation, this new Bill is not applicable to the De Paule Band Club! It is unjustified to state that this club does not own property. As the situation stands at present, the club owns, among others, part of the present property. Therefore, as the first draft law stands, it cannot be applied to clubs owning other property.

Previously, I had stated that the solution needs to be found in the existing laws and this is where government is making its biggest mistake. By enacting a new bill, government is attempting to practically requisition a property without offering compensation. Even worse, it is exposing club members to a case of contempt of court. A judgement of the Court of Appeal must be respected. Should the current lessees not abide by the Court of Appeal’s ruling, they are liable to be charged both in the Civil Court as well as in the Criminal Court. This new law can never  protect them from such a charge.

Some decades ago, my grandmother faced a similar situation. The Labour Party was in government and Lorry Sant was Minister for Housing. There was a family who lived in a property that my grandmother rented out at Paola. Despite the fact that the rent was protected and very cheap (Lm10 per annum), this family still refused to pay rent. My grandmother took the family to court. Rightly so, the court ordered its eviction. The family asked Minister Lorry Sant to intervene. Mr Sant advised them to obey the law. They moved out, gave the keys back to my grandmother, but once the property became vacant and my grandmother had the keys of this property, Minister Sant made use of the existing laws and requisitioned the property. As this property did not fall under what, back then, was called the Housing (Decontrol) Ordinance, the minister had the power to requisition, for social use, empty properties built prior to 1975. Lorry Sant reinstated the old tenants at the same rent that they had before (Lm10)! 

Obviously, this method cannot be applied today. But the point here is that even Lorry Sant made sure that a court sentence was respected. This government has to make sure that civil sentences are respected. The ray of hope for the De Paule Band club is being offered by the owners themselves. They are more than willing to sell their property and this goes a long way to help find an equitable solution.

Government has options. It can resort to the Requisition Laws. According to the changes made by Minister Austin Gatt, if a government requisitions a property, it must immediately pay the owner/s the fair market price for the property. Therefore, should government choose this solution, the owners would still be getting their money. Incidentally, government can requisition it because the property has a public function. Government is acknowledging that band clubs are part of Malta’s cultural identity.  In this case, there would be the issue of why should the taxpayer pay for such a property. However, the tax payer would not be paying for this property for the simple reason that the club already owns part of the premises. Therefore, the club would return part of the tranche that it would be receiving from government for requisitioning the entire building.

Then, there is the other part of the building, which makes for the lion’s share that goes to its owners for having had their property requisitioned. The De Paule Club has assets which can make good for this part of the requisition. At the moment, they cannot be turned into liquidity but they could be exchanged – and the current policies allow this - in part fulfilment to acquire the rest of the property from government.

Strictly speaking, the government cannot sell property to third parties that it has acquired for public use. But in this case, I still believe that it is possible because band clubs are not companies or private individuals but semi-public entities. Furthermore, the current policies allow owners to exchange land or property for government property. Then, if by this exchange, government does not recover the full value that it paid, the club can enter into an agreement with government to pay back the outstanding balance over a number of years.

There is another solution for government. Normally, these band clubs have problems to obtain loans from commercial banks. Government can legislate that in those cases where clubs, which are subject to the past rental laws and are faced with court evictions, can get a soft loan from government to purchase the club. The band clubs will repay this loan over a number of years.

Moreover, government could also pass laws to make sure that clubs faced with eviction get goodwill money for being instrumental in enhancing the commercial value of the property and area. Even if there is an Eviction Order, the club should be entitled to compensation once a property is sold or rented. Compensation would not hold if the owners of the property intend to use the property for residential purposes.

Instead of studying options, a law has been presented that kills a Court judgement!  With this new law, any person who has a property that was leased to him under the proviso that he cannot make structural alternations without the owners’ permission, can do so. This is now happening with the consensus of both government and the Opposition and all this goes against  the very basic principle of the civil code. A civil contract agreed upon by all parties cannot be annulled unless there is a breach of contract. In this whole story, the owners of this property cannot be accused with a breach of this contract! 

 

 

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