Located at the end of Melita Street, Mifsud & Mifsud is an understated boutique law firm in the heart of the capital that has certainly made its mark in recent years.
Set up by brothers Malcolm and Cedric, the firm has secured its reputation across many aspects of law – including litigation, corporate, commercial and maritime. In addition they operate a corporate services company called AEGIS and, together, both entities employ a team of 11.
However, since their launch in 2007, rent law has also come to be a cornerstone sector for the firm and, today, they have positioned themselves as forerunners within this very particular part of the law. “Rent law has been a contentious issue for many years,” explains Cedric. “In fact, the laws within it are often unconstitutional and in breach of the fundamental human rights that relate to landlords’ property rights.”
Cedric is, of course, referring to the long established rent laws that have enabled tenants to live in properties for many years, but pay well below their worth because it is stipulated that Maltese residents needing the property as their own homes can stay in it indefinitely. “For decades, landlords have been gridlocked because their tenants can’t be removed as long as they are living in the property, regardless of how little they are paying. However this started to change five-or-so years ago when a judgement in Strasbourg stated that landlords had a right to enjoy their property and to receive an appropriate amount of rent for it.”
Change was also set in motion when Cedric won a landmark case in 2010 that was filed in favour of the landlord, not the tenant. “It was the first case of its kind but there have been several others since; the precedent was definitely set and we have found ways round the laws to enable landlords to reclaim what is rightfully theirs or, at the very least, receive the appropriate value for it – whether by upping the rent or even selling the property to the tenants for a fair price.
Many of the cases the Mifsuds have won have been similar. “Often, someone has inherited a property, but that property has been found to have a tenant living in it that is rented according to the 1979 rental laws that means they are paying a very small amount,” continues Cedric. “They then come to us to ask for advice on what can be done to rectify the situation.”
And, although the law still states that the tenants have a right to stay in the property indefinitely, clients often ask the Mifsuds to challenge that and attack the law – which they have done successfully on numerous occasions. “We start by showing the court the value of the property today and highlighting the rent it should be getting as opposed to the rent that is actually being received for it. For instance, we have had cases where a property is found to be worth €400,000 and with a rental value of between €800 and €1,000 per month, but which is only receiving around €300 per year. It is then our job to show the court that this is disproportionate.”
The Mifsuds have won all their cases on the subject thus far, resulting in the courts admitting that the landlords were suffering loss of income and filing that the tenants should face eviction. “However most cases don’t actually result in eviction because the tenants and landlord choose to come to some sort of agreement, whether that’s a higher rent package or even the sale of the property for an agreed amount,” Cedric says.
But despite the progress that’s been made, the brothers refer to the law as a ‘hot potato’ and admit it won’t be changed overnight – but they are pleased to have proved that the law can work in favour of landlords. “While some changes have been made to the 1979 law, they have so far been inadequate when it comes to properly compensating landlords,” Malcolm says. “In my opinion, the most balanced way forward would be a phasing out of the current law. I would suggest a cut-off date of, say, 10 years, within which tenants need to have moved out or bought the property as per an agreement with the landlords.”
Asked about how landlords (or even tenants) who feel disadvantaged should proceed, Cedric recommends contacting a lawyer for advice. “If possible, have the rental contract with you so it is clear what was agreed and when the contract was signed. The process will start with a valuation of the property, as this will clearly define where you stand from a financial loss perspective. Once that information is clear, the work towards rectifying your situation can begin in earnest,” Cedric asserts.
For more information you can contact one of our Team Members at Mifsud & Mifsud Advocates.