Gaffarena land transfer deals rescinded by courts

A court yesterday revoked deals made by the Lands Department that would have given controversial businessman Marco Gaffarena parcels of public land in a part-exchange compensation deal for a government requisition.

The case was filed by Prime Minister Joseph Muscat, in his capacity as a Member of Parliament, and the attorney general, against Mark and Josielle Gaffarena, the lands commissioner and the lands registrar. Several other part-owners of the Valletta palazzo later joined the suit.

Times of Malta had exposed how Gaffarena acquired two quarters of the Old Mint Street building shortly before they were expropriated by the government. The government had paid Gaffarena some €3.4 million in cash and parcels of land which, it later emerged, had been grossly overvalued.

These consisted of: a property in Manuel Dimech Street, Sliema; a 5,800-square-metre parcel of land in Ta’ Kandja; a 9,800-square-metre parcel of land in tal-Ħandaq, Qormi; two parcels of land measuring 3,735 square metres and 1,663 square metres in Baħar iċ-Ċagħaq; and two parcels of land measuring 2,150 square metres and 24,000 square metres in Żebbuġ.

The case, which saw alleged inside information being given to Gaffarena, had led to the resignation of then-Lands Minister Michael Farrugia, who was reappointed to the cabinet as family minister after the 2017 general election. The prime minister and the attorney general had then filed a case to nullify the contracts and recoup the lands.

The Gaffarenas tried to get the case thrown out by arguing that since Muscat was acting in his capacity as an MP, he could not then refer to himself as the prime minister. They also argued that no call had been made for the revocation of the presidential declaration authoring the expropriation.

The defendants said everything was legal and had been done according to longstanding practice, and insisted that this case had political nuances.

But the court dismissed their arguments, pointing out that they had not proven the updated valuations wrong.

The court revoked all transfers made and ordered the return of all assets to government.

The civil court found that the commissioner for lands was wrong to only offer compensation to Gaffarena and his wife, when the Old Mint property was jointly owned by a group of people. “The commissioner should have compensated each of the owners pro-rata,“the court ruled. “The government effectively acquired part of the property belonging to all its owners and only paid one owner for it.”

It also said that there was no reason to doubt the new valuations, carried out by PwC at the request of the attorney general, which valued the Valletta property at €2.45 million. This meant that an undivided quarter was worth €614,731.

Political parties claim credit

The government, the Labour Party and the Nationalist Party all claimed credit for the ruling.

In a statement, the Labour Party welcomed the court judgment, saying the prime minister had filed the case to protect the interests of the Maltese people.

The court judgment brought to nothing the criticism levelled by the Nationalist Party, which had spoken against the court case filed by the prime minister. Such a court case could have been opened by any MP, but it was the prime minister who took the initiative after the report compiled by the auditor general. This case confirms that the rule of law works in the country, the PL said.

The government, in a separate statement on similar lines as that of the PL, said it welcomed the judgment and said the prime minister had taken the decisive step to take back what the Lands Department had given to Gaffarena.

Later, the Nationalist Party said that the court had vindicated the position it had taken, adding that the party was increasingly becoming the voice of the people.

The Old Mint Street scandal is only one of several involving government property, such as the land at Żonqor, Café Premier and three public hospitals, the PN said.

The PN was right when it said that the Labour government had abused its power when it gave public land valued at €3.5 million to buy half a property that already belonged to the government.

The Old Mint Street deal was carried out in Castille under the prime minister’s watch, so much so that the auditor general had drawn up a report to say that there had been interference by then-Parliamentary Secretary Michael Falzon.

The PN said it expected Prime Minister Joseph Muscat to join Opposition leader Adrian Delia in his court case against Vitals to revoke the deal on three public hospitals.