Possibly one of the most complex areas of civil law, we strive to explain to clients the different types of ground-rents that exists, be it perpetual, temporary, revisable or non-revisable, and their repercussions. We assist clients with explaining contracts, as well as with the procedures to redeem (tifdi) a ground-rent, both private ground-rents and Government owned.
When a property is given in emphyteusis, a juridical relationship is created between the transferor (the ‘dominus’) and the transferee (‘the emphyteuta’). Amongst other conditions, a ground-rent (ċens) is imposed on the property in question, which ground-rent is payable to the dominus or his successors in title by the transferee or his successors in title.
When a property is acquired by title of emphyteusis, the acquirer (the emphyteuta) would be obliged to pay the annual specified sum of money due as ground-rent and would also have to adhere to the conditions of the emphyteutical contract which may restrict what the acquirer may or may not do with the property.
There are different types of ground-rent. Of the utmost importance, is the distinction between perpetual, temporary and revisable ground-rent.
Perpetual Emphyteusis lasts forever but may at any time be redeemed (‘jinfeda’) by the current emphyteuta by paying 20 times the amount of the ground-rent to the dominus. This right of redemption is absolute and nobody may interfere or oppose the redemption. It may be done either by means of a contract between the two parties in front a notary public, or in the absence of such agreement, the emphyteuta may exercise the right of redemption by filing a schedule of redemption (ċedola) in Court.
Temporary Emphyteusis expires after the lapse of the time period stipulated in the original contract of the emphyteutical concession. This means that after the expiration of the original grant, the property will revert back to the dominus or his successor in title. If however, the emphyteuta is residing in the property in question as his ordinary residence, then the law grants the emphyteuta the right to convert the title into a lease or a perpetual emphyteusis (depending on certain circumstances established by law).
Revisable ground-rent: This means that the ground-rent will increase from time to time according to the terms of the original grant (ex: every 25 years). Sometimes, the increase is determined beforehand (ex: the ground-rent will double every 25 years). At times, however, the ground-rent will increase according to other factors, such as depending on the rate of inflation or according to the average minimum wage at the time of revision. Naturally, this can lead to significant increases. Also, in the case of a revisable ground-rent, the emphyteuta does not have the right of redemption any time he wants to, but only within a one-year period starting from every revision. Besides the value of the redemption is calculated on the increased ground-rent.
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Contact us for more information or to make an appointment in relation to any matter relating to emphyteusis.