Website design By BotEap.comArticle 1494 of the Maltese Civil Code (Chapter 16 of the Laws of Malta), defines emphyteusis as follows:

Website design By BotEap.comEmphyteusis is a contract by which one of the contracting parties grants the other, in perpetuity or for a period of time, a property for a certain annual rent or ground rent, which the second agrees to pay to the first, in money or in kind, as recognition of possession”.

Website design By BotEap.comEmphyteusis is typical of continental (European) law and not of English law. It is very different from leasing or renting a house or land. This is because, unlike the lease, the emphyteusis is a real right that is attributed to the land that is contracted and not to the person who contracts it. On the other hand, the lease, being a personal right, does not affect the land or the house that is granted, but only the person who receives the lease. The legal implications arising from these differences are considerable, especially as regards the rights and obligations of the contracting parties.

Website design By BotEap.comThe Emphyteusis contract must be made by public deed before a Notary Public. It would be void if it was done in private writing. The lease, on the other hand, may be concluded by private deed and will have the force of law. The emphyteusis contract cannot be modified during the entire emphyteutic period. Once ground rent is established, it cannot be changed.

Website design By BotEap.comArticle 1494 establishes three key phrases that need to be clarified:

Website design By BotEap.comYo. in perpetuity or for a time

Website design By BotEap.comThere are two types of empiteutic concessions: Perpetual emphyteusis and Temporary emphyteusis. The first is a payment that must be made annually with the legal option of redemption. Redemption turns the earth into freehold. Temporary emphyteusis, on the other hand, is a multi-year contract. (Usually in Malta the most popular number of contracted years is 17 years old, 21 years old, 99 years old and 150 years old).

Website design By BotEap.comii. declared annual rent or ground rent

Website design By BotEap.comThe ‘canone’ or ground rent must be included in the contract, under penalty of nullity, and must be paid annually to the dominus, that is, to the owner of the house.

Website design By BotEap.comiii.

Website design By BotEap.comThe user acknowledges the fact that he can legally enjoy that property and must recognize the dominus as the real owner of said property.

Website design By BotEap.comThe Emphyteusis contract is a sui generis contract whereby the dominus, who is the true owner of the property, is temporarily deprived of all his property rights. Such rights and obligations are transferred to the ‘utilista’, the person who enjoys such concession, during said period. At the expiration of the contract, the property, with all the improvements made to it, will revert to the dominus and there will be no right to extend the Emphyteusis.

Website design By BotEap.comIn the old days, landowners used to give emphyteusis to farmers who tended the land. Sometimes the pact was that as recognition, instead of paying money, the farmer gave the dominus part of the product, harvest or fruit that the land produced.

Website design By BotEap.comThe property rights and obligations are, during the execution of the Emphyteusis, conferred on the user and not on the real owner. Article 1507 establishes that the user is obliged to fulfill any obligation imposed by law on the owners of buildings or land. This demonstrates the user’s responsibility for the maintenance of the property. He must treat such property as his own. However, if the fulfillment of such obligation implies a considerable expense, the utility may request before the First Chamber of the Civil Court that the dominus be obliged to contribute a part of the expense. In such a case, the court will take into consideration, first, the emphyteusis contract entered into by the parties, the remaining term of the concession, the amount of ground rent and other circumstances pertinent to the claim.

Website design By BotEap.comThe utilitarian has a very broad right to dispose of the goods he has under Emphyteusis; he can dispose of the emphyteutic property through a public deed, which can be act inter vivos, that is, done during his lifetime, or causa mortis, that is, done after his death, in this case, by will. The utility can sell the Emphyteusis to a third party for a specified amount of money. Obviously, she will sell the rest of the emphyteutic period. Furthermore, he can regrant ownership under Emphyteusis, known as sub-Emphiteusis, in which case he himself will be receiving a rent from the land.

Website design By BotEap.comSuch disposal of assets does not require permission or consent of the dominus, in either case. In addition, the rights and obligations of the utilita, after the transfer, will be transferred to the new utilita or sub-emphytheuta. The latter will only become the new utilita after the dominus has recognized it. Unless the new utilita is known to be incapable of fulfilling its contractual obligations, the dominus cannot refuse to acknowledge it. In the event that the dominus refuses to recognize the new utilita, it will continue to be personally linked to the first for the payment of ground rent.

Website design By BotEap.comDuring the period of execution of the Emphyteusis, the utility has the right to ‘modify the surface of the property, provided that it does not cause any deterioration of the same’ (article 1506 (2)). Therefore, if the user would like to build more or add to the already existing structures on the land, he can do so. Furthermore, he is entitled to any ‘hidden treasure’ that he may find on said property. The dominus is not entitled to an action.

Website design By BotEap.comAt the expiration of the Emphyteusis, the utility is required by law to return the land or property with all the improvements made throughout the years during which the property was under the Emphyteusis.