Some of the defendants in the second hospitals case on Thursday sought a constitutional reference on the recently introduced updates to Malta’s freezing order laws, arguing that the law breached the accused’s fundamental rights.
This happened in court on Thursday as the case against Chris Fearne, Edward Scicluna and 13 others in relation to the Vitals hospital concession continued.
Four people and one company – Deborah Anne Chappell, Kevin Deguara, Kenneth Deguara, Jean Carl Farrugia, and DF Advocates – are subject to freezing order requests as part of the charges.
Prosecutors want a freezing order of €40 million for Chappell, a freezing order of €20 million each for Kevin Deguara, Jean Carl Farrugia, and DF Advocates, and a freezing order of €14 million for Kenneth Deguara.
The topic of freezing orders has already been a contentious topic during this case: last week the prosecution would not explain how they arrived at the amounts in each freezing order, arguing that the law did not demand detailed evidence to justify the freezing orders.
On Thursday there was a new twist as defence lawyers Ezekiel Psaila, who is representing the Deguaras, Farrugia and DF Advocates, and Stefano Filletti, who is representing Chappell, sought the matter to be referred to the constitutional court.
The constitutional reference was filed to contest the short period of time allowed by the Criminal Court in which the defence can file an appeal to a freezing order.
Under the terms of the Proceeds of Crime Act – which was only amended by the government last year – the defence has just seven working days to contest a request for a freezing order before the Criminal Court decides on it.
On the contrary however, the law does not bind the prosecution with any such time limit when contesting or seeking to vary a freezing order.
Filletti explained that the law breaches the defendants’ right to a fair hearing and also their right to the enjoyment of properly, as established by the European Convention of Human Rights.
Psaila added on that the defence is simply seeking equality of arms between the defence and the prosecution, remarking that when he had asked for evidence to back up the request for the freezing order the Attorney General’s office had simply told him that it could be found in the 78 boxes of evidence in the magisterial inquiry.
“We want a fair hearing and that is why we are asking for a reference,” he said. “If this situation isn’t considered as a clear imbalance, then what do I have left as arms?,” he added.
The prosecution, led by AG lawyer Francesco Refalo, objected to the request, arguing that the matter had already been brought up before and therefore shouldn’t be referred to the Constitutional Court, but the defence replied that the courts in the Muscat case had issued a decree saying that the same law merits consideration by the Constitutional Court.
Indeed, on Wednesday Judge Edwina Grima ruled in favour of a practically identical request filed by Keith Schembri and Konrad Mizzi and agreed that seven working days was too short a time period to contest a freezing order, particularly within the context of such a voluminous inquiry. The matter therefore was referred to the constitutional courts.
Psaila said that all of this could have easily been avoided if the Attorney General were to testify where the evidence to back up each and every single freezing order is.
Magistrate Leonard Caruana will rule on this particular constitutional reference request before the next sitting.
Thursday’s sitting saw four witnesses testifying: the three police inspectors – Wayne Rodney Borg, Anthony Scerri, and Rennie Stivala – who assisted magistrate Gabriella Vella during the proceedings of her inquiry, and Criminal Court registrar Franklin Calleja.
Defence lawyers also mentioned some witnesses they would like to summon to testify before the court decrees on prima facie in the coming days.
Among those are an official from Jobsplus, the director of the National Audit Office or a representative, two more police officers, and also – at the request of Fearne and Scicluna’s legal counsel – the Cabinet Secretary.
The case continues on Tuesday 2 July.
Read minute-by-minute commentary of the court sitting below
13:15: Some debate over what will happen in the next sitting, which will take place on 2 July at 11am.
Witnesses from Jobsplus, the director of the NAO or a representative, and two police inspectors will be summoned to testify. The Cabinet secretary has also been sought as a witness, but he will testify in another sitting.
That is the end of the sitting. Thank you for following this live blog – a summary of proceedings will follow later in the afternoon.
13:08: Magistrate Caruana explains that we will not hearing matters relating to the freezing orders today, particularly within the context of the constitutional reference filed earlier in this sitting.
13:01: Former police inspector Anthony Scerri returns briefly to the witness stand as it is discussed whether a document – the list from the police file which Scerri read from on what information had been requested on a number of people – can be presented.
The prosecution objected to the request because the list includes people not related to the case and who may be subject to investigations and may have their rights prejudiced.
Lawyer Joseph Mizzi argues that the document is not the police file and says that the prosecution’s argument that the exhibition of the document may prejudice those not in the case doesn’t make sense because the 78 boxes – which includes sensitive details on people not charged – had been exhibited.
Magistrate Caruana points out that what is exhibited in a criminal case is not publicly available. Mizzi says therefore there should be no problem with the document in question being exhibited.
The magistrate decrees and agrees with the defence as long as the document is sealed in the acts of the case and is accessible only to the defendants and the prosecution in these proceedings.
12:53: Lawyer Franco Galea says that that the defence will be contesting the appointment of the experts in the inquiry at a later, “opportune” stage. He said that today’s testimonies had only strengthened the possibility of this.
Magistrate Caruana decrees that the court is confirming the nomination of the experts as appointed in the magisterial inquiry.
12:47: That brings Calleja’s testimony to an end. He steps off the witness stand. He was the final witness for today.
12:45: The prosecution is objecting to the request in view of the fact that the magistrate can choose to appoint experts according to the needs and exigencies of the case, and as the registrar himself had just testified the magistrate is not tied to the mentioned list.
The court accepts the defence's request and allows it to carry out this exercise - which is to check whether the experts appointed in the inquiry are on the court's database.
Lawyer Michael Sciriha asks whether any due diligence was done on the foreign experts, and the registrar says that the Department of Justice can answer this not him.
12:42: Criminal Court Registrar Franklin Calleja now takes the stand. He exhibits a document pertaining to court applications related to the case.
Psaila asks whether he had come across any documents which indicated how the foreign experts had been appointed, as there did not appear to be any such documents in the inquiry.
Calleja replies that common practice is that when a magistrate appoints an expert it is done through a decree which would then form part of the inquiry. What is in this particular inquiry though, Calleja does not know.
Lawyer Michael Sciriha asks the registrar whether he had a list of experts that may be appointed. Calleja says there is a list, but he cannot confirm whether all the experts appointed in the inquiry are on it.
Filletti asks for more details about this list, but as Calleja is about to answer, Refalo steps in to ask what relevance such questions have to the prima facie stage. Filletti wants to establish whether the experts in the inquiry – which the prosecution had rested its case on – had been officially appointed or not.
Refalo objects to the question, but the Magistrate allows it. Calleja explains that the list is informational – a member of the judiciary may choose to appoint people who are not on this list should they wish.
The list in actual fact is a database split according to the experts’ specialisations, Calleja says.
Exhibiting the whole list would be a “fishing expedition”, magistrate Caruana says, and invites the defence to submit a list of who they are looking for. AG lawyer Refalo stands up as if he is about to say something, the magistrate invites him to speak, but Refalo pauses and says “nothing” and sits back down.
12:34: Filletti asks about sittings he was involved in and the witnesses who had been called in. Stivala says that as far as he remembers, all those called in had been called in as witnesses not as suspects.
To the best of his knowledge, none were reminded of their right to have a lawyer present during the sittings, Stivala says.
That concludes his testimony, and he steps off the witness stand.
12:29: Inspector Rennie Stivala who now works at the Asset Recovery Bureau is up next on the witness stand.
Lawyer Arthur Azzopardi asks which searches that Stivala was involved in, and the inspector – who was the first to be assisting the magistrate in the inquiry – reels off a list of searches on people and companies which he had been involved in.
Among them are searches on Technoline and on Nexia BT. A local expert had handled device seizures and directly deposited them himself. It was his impression - he doesn't quite remember - that keywords for the search at Nexia BT was provided by the foreign experts following agreement with the magistrate.
12:25: Franco Debono – unusually quiet thus far today – is up next to cross-examine the witness.
Debono is asking about search warrant. There is some debate as to whether Kevin Deguara and Jean Carl Farrugia had been subject to a search warrant or not.
Debono is saying that the warrant was solely for DF Consultancy Ltd, Scerri is arguing that the trio had also been subject to the warrant. The lawyer cites from a document which is then passed on to Scerri, and Scerri agrees with Debono.
Debono asks whether DF Consultancy had been indicated as a suspect, to which Scerri replies that it appeared as such from the document. “So all of the rights that a suspect should have should have been granted from there, correct?,” Debono says. Scerri nods in agreement.
Debono looks behind him – presumably at his clients – gives a nod, and says that’s all he has in terms of questions.
12:17: Mizzi is seeking the list that Scerri is reading from to be filed in court. He says that it’s relevant because Chappell was not aware at the time that she was a suspect despite being subject to these searches.
Mizzi adds that the document is particularly relevant because it shows how the investigation was handled and helps to establish whether the defendant had been given the rights that should be given to someone who is considered as a suspect.
Magistrate Caruana can’t understand why this matter – whether Chappell was cautioned or not and so on – is being brought up now and not later.
The prosecution also asks the media to be banned from mentioning anybody on the list which Scerri has in hand. The magistrate grants this request.
12:11: Mizzi asks what was seized from Deborah Chappell. Scerri says that there was a seizure of a notice of hearing for the case Deborah Chappell vs Steward Malta et. Scerri confirms that Chappell testified after the search took place – which was in October 2021.
“As a policeman: a person who is not a suspect, but has their offices and bank accounts searched and had devices searched – as a police officer, did you consider her a suspect?,” the lawyer asks.
Magistrate Caruana stops the inspector from asking, saying that this is a matter of opinion.
Scerri offers some context: he says that when he had been previously asked about this and he had gone back to check his diary. He was marked in his diary as being on leave, but also had some court work and it wouldn’t have been the first time that he worked anyway despite being on leave.
To this day, though, he does not remember whether he had attended the sitting where Chappell had testified. He remembers attending a meeting at 3pm with the magistrate, but had tried his best to reconstruct his day but still could not recall whether he was present at the sitting.
Scerri says he didn’t have access to Chappell’s transcript.
12:03: Mizzi asks about a list of searches, including one on Steward, and asks whether Chappell was included on the list of places and people to search. Scerri replies on the affirmative.
Scerri says that in those searches, they were seeking particular files which may be of interest to the case. In terms of devices, every device – irrespective of who it belonged to – was of interest. He continues that on the day there were foreign forensic IT experts who had been appointed to assist and to see exactly what needed to be seized but to not take any servers or data that didn’t need to be taken.
So these foreign experts were given access to the servers at the time and had access to the same list, Mizzi asks. Scerri says he wasn’t in most of these places and couldn’t say for sure what happened.
11:58: Joseph Mizzi is first to ask questions, and he asks whether Scerri had done any searches pertaining to Deborah Ann Chappell, to which he replies that he hadn’t.
Mizzi now asks about a document – a list – which features Chappell and a number of others and pertains to information requested on these people from Bank of Valletta. He asks whether this indicates that Chappell was being considered as a suspect or not.
“The police never had a list of suspects,” Scerri replies and says that this was a request made by the magistrate. The magistrate wanted to know transaction details: particularly transactions from David Meli.
Mizzi asks Scerri to confirm that for such a request to be made, Chappell must have been considered as a suspect, but Scerri says that he cannot say one way or another because the police had no such visibility.
11:53: Gianella De Marco is now speaks, saying that there was no mention, no searches, no declaration that her client Aron Mifsud Bonnici was even a subject of person of interest.
She asks Borg to look at her, and then asks the inspector to confirm that Mifsud Bonnici had been mentioned in the inquiry – merely in the conclusions – as being complicit, yet the prosecution had chosen to charge him as an author of the allegations.
Borg confirms, and that is all De Marco has in terms of questions.
Borg departs from the witness stand and former police inspector Anthony Scerri is up next.
11:50: Tonna Lowell asks questions next and says that there is a substantial difference between the charges in the inquiry and the charges filed against the accused. He wants to know what resulted in this discrepancy.
Borg says that he doesn’t know why there is a discrepancy. “So you do not know of anything which could have resulted in these charges to be changed,” Tonna Lowell asks. “No,” Borg replies.
Lawyer Franco Galea is up next. He asks whether the magistrate had received the report from the National Audit Office on the hospitals deal. Borg replies in the affirmative.
Galea now asks whether in that investigation the names James Camenzuli and Bradley Gatt came up. Borg says that the police did not take any action on the NAO report so he couldn’t say for sure. Galea pushes on the matter, but Borg says he had no visibility.
11:42: Psaila is the one asking the questions to the police inspector. He asks him what his involvement was in the magisterial inquiry.
Borg replies that his involvement was in assisting the magistrate with summoning witnesses and he also had some small involvement in a search on Steward.
Psaila refers to a search on 6 September 2021, and says that after this search a court application was filed by Kevin Deguara and Jean Carl Farrugia for some mobile phones to be taken. He asks the inspector whether he had replied, but he replies that he was not involved.
Nothing further for Psaila. Lawyer Joseph Mizzi is up next.
He asks when Borg was involved in the case, and he says that he was given the file in August 2022.
Describing the search at Steward he says that there was nobody apart from a couple of receptionists, and he had merely sealed off the place before police inspector Anthony Scerri. Borg had no documentation on what had to be seized and from who for this search.
Mizzi asks what involvement he had in a request for representatives from Bank of Valletta to submit information, to which Borg replies that he would follow the magistrate’s direction in what she needed for the purposes of the inquiry, and he would liaise with the bank’s representatives for whatever the magistrate needed.
11:37: The defence is arguing that the court in the Muscat case had mentioned in its decree that the matter merits investigating by the Constitutional Court, and finds it unbelievable that the Attorney General would even object to the direction of the court.
Psaila says that all of this can be easily avoided if the Attorney General were to testify where the evidence to back up each and every single freezing order is.
“We aren’t trying to be difficult, but we were only given the documents based on which these people were charged in court a few days ago… just a few days ago,” Psaila says.
He continues that now not only does the prosecution not want to show us which evidence there is for each client, but doesn’t want us to seek constitutional direction on it.
The magistrate says that’s enough submissions on the matter, and moves on to the first witness of the day: inspector Wayne Rodney Borg.
11:29: Filletti replies and declares which articles he is claiming were breached: those pertaining to a right to a fair hearing and protection of property laws in the European Convention on Human Rights.
He continues that a freezing order can be extended by more than twice, and so the final point mentioned by the prosecutor does not subsist.
Finally, he said, with regards to the constitutional reference it had already been made with regards to disclosure before the charges were read, and therefore it cannot be said that the request made today with regards to the freezing orders is one which the court has already pronounced itself on.
Ezekiel Psaila also replies, and says that he is also seeking equality of arms between the parties. He exclaims that the Attorney General had simply told the defence to sift through 78 boxes of evidence to find proof for the freezing order.
“We want a fair hearing and that is why we are asking for a reference,” he says. “If this situation isn’t considered as a clear imbalance, then what do I have left as arms?,” he adds.
11:20: The prosecution objects to the request, and lead prosecutor Francesco Refalo says that the objection is based on the fact that it was not indicated precisely which fundamental rights had been breached by the law in question.
Refalo continues that the prosecution is also objecting because this matter has already been brought up before and a point which has already been brought up for a constitutional reference, should not be referred to the Constitutional Court.
He cites from a decree by then-Magistrate Natasha Galea Sciberras where she ruled that the court should hold back from granting constitutional references if a matter of such nature had already been brought up.
Refalo continues that with regards to the freezing order, this has a six-month validity period and therefore if this term expires then the assets will not remain protected.
11:16: Filletti now dictates a request, and says that he is asking the court to refer the matter to the Constitutional Court on the basis of a decree issued yesterday – 26 June 2024 – where in this decree the courts recognised that at an advanced stage of hearings related to the issuing of freezing orders, there may be a tangible breach of fundamental rights.
On this basis, the defence is requesting that a constitutional reference is granted in order to establish whether legislation pertaining to freezing orders breach the fundamental rights of the accused.
Lawyer Ezekiel Psaila has associated himself with this request as well.
11:11: Lawyer Stefano Filletti, representing Deborah Ann Chappell, has also asked the court for a representative of the prosecution to testify about the case.
Lawyer Ezekiel Psaila, appearing for Jean Carl Farrugia, Kenneth Deguara, Kevin Deguara, and DF Advocates, also wants someone from the prosecution to testify about the amounts mentioned in the request for a freezing order against his clients – which run into the millions.
Filletti has also hinted that a constitutional reference has been filed. This would grind the case to a halt if it is granted: a constitutional reference is a request for the Constitutional Court to rule on a particular point, and the case would stop until the Court rules on it.
The court says that this reference was filed due to the short period of time allowed by the Criminal Court during which the defence can file an appeal. Filletti has argued that the court gave an indication in a decree that the defendants are right both in their procedural and substantive arguments.
Magistrate Caruana gives parties till tomorrow to submit a note with the relevant decree, and says the note should be signed by both the prosecution and Filletti.
11:02: What does it mean when we say prima facie?
Prima facie is a process where the magistrate hearing the case decides whether there is enough evidence ‘at first glance’ in order for the charges against the accused to be substantiated. Such a declaration must be made within 30 days of the case beginning.
Defendants may choose to contest it if they feel that there isn’t enough evidence against them from the get go, or they may choose to not contest it.
We had examples of this from earlier this week in the other case pertaining to the hospitals deal: Joseph Muscat, Keith Schembri and Konrad Mizzi all didn’t contest the prima facie and therefore Magistrate Rachel Montebello decreed that there was enough prima facie evidence against them for the case to go on.
That means that the Attorney General’s office may issue a formal bill of indictment against them as long as it is within the next 20 months.
However one of the companies which did contest the prima facie – Sciacca Grill Ltd – was successful in its contestations: Magistrate Montebello decreed that there wasn’t enough evidence at first glance for the charges against the company to stick, and therefore discharged it from the case.
The Attorney General there has a choice as to whether to drop the case against Sciacca Grill entirely or whether to direct the police to keep investigating the company and bringing more evidence against it at a later date.
It isn’t expected that Magistrate Caruana will be issuing a decree on prima facie today though.
10:55: We know so far that former police inspector Anthony Scerri will be summoned to the witness stand today.
Lawyer Aron Mifsud Bonnici is joining today’s sitting remotely, and his lawyer Gianella De Marco has said that he will be contesting the prima facie.
Other defence lawyers have said that they wish to summon officials from Jobsplus, the National Audit Office, and also the secretary of Cabinet.
10:54: Good morning and welcome to this morning’s live blog from Hall 22 in the Valletta law courts.
Proceedings have begun and Magistrate Leonard Caruana is currently discussing with the defence lawyers who will be contesting the prima facie declaration and who would like to call witnesses to the stand.