Latent Defects and the Actio Redibitorja

On the 27th March, 2018, in the case Godfrey Vella et vs. Architect and Civil Engineer Brian Ebejer et, the First Hall Civil Court, presided over by Justice Joseph R. Micallef scrutinized and outlined the concept of actio redibitorja, which as defined under article 1427 of the Civil Code (Chapter 16 of the Laws of Malta) refers to the restoration of the thing (purchased) and the re-payment of the price. The Court, through the judgment under examination, delved into those requirements which must be present for the actio redibitorja to be validly instituted before a court of law.

On the 17th June 2011 the plaintiffs entered into a contract of sale with the defendants, whereby they agreed to purchase a garage situated underground in Naxxar.

In September 2011, a few months after the contract had been entered into, the plaintiffs discovered water along the inner walls of the garage. When they approached the defendants to make good and account for the defects, which had then become apparent, the defendants failed to comply. For this reason, on the 15th June 2012, the plaintiffs filed an application before the First Hall Civil Court claiming that the garage they had purchased from the defendants was burdened with underlying latent defects.

Initially, the garage was purchased by the plaintiffs in order to store their car and certain other items, however, as a result of such defects they were unable to enjoy full and proper use of the garage, due to the high levels of humidity which only became apparent after the contract had been finalized. Furthermore, the plaintiffs stated that had they been aware of such defects they would not have purchased the garage. They are hence requesting the Court to revoke the contract of sale, for the garage to be returned to the defendants (the sellers), and have the original purchase price (€11,600) returned to the plaintiffs (the buyers).

The defendants on the other hand claimed that plaintiffs knew about such defects prior to entering into the contract, as it was evident that the walls of the garage were wet, they are therefore claiming that the plaintiffs action cannot be brought since defects were apparent and hence not latent.

The court, upon examining the circumstances of the case, confirmed that the action being brought by the plaintiffs falls under the actio redibitorja, which is an action through which the buyer asks the seller to take back the thing purchased in return for the purchase price being reimbursed to the seller.

In such an instance, the onus of proof falls on the plaintiff, who has the responsibility of proving that the defect was in fact concealed and that they did not and could not have known about it. Furthermore, the court pointed out that even if the seller claims he was not aware of the defect, it does not release him from his obligation of making good for the damage caused, this emanates from article 1424 of the Civil Code, which states the following;

“the seller is bound to warrant the thing sold against any latent defects which render it unfit for the use for which it is intended, or which diminish its value to such an extent that the buyer would not have bought it or would have rendered a smaller price, if he had been aware of them”.

The Court began by defining the term “latent defect” and stated that such defect is one which is not apparent, neither prima facie nor after having examined the premises. The extent to which such examination must be carried out has been debated time and time again, however the court concluded that: When the buyer, after having carefully carried out an examination of the premises / thing in question, is still not aware of any defects, those defects which occur thereafter will be classified as latent.

The court went a step further and stated that in order for a defect to be classified as latent, it is not sufficient to solely prove that the defect was not known, however, one must also prove the following: that the defect is (1) grave and serious, meaning that the defect must be one which greatly effects the thing purchased, so much so that it no longer remains good for its initial purpose (2) that it had already existed prior to the sale and (3) that it was hidden.

The Court, thus, in accordance with the statement brought forward by Architect Grech, stated that it appears as though the problems had arisen whilst the property was being built, that the deficiencies only became apparent to the plaintiffs after the conclusion of the contract of sale, and that the defects were of such an extent that the garage could no longer be used for its initial purpose.

In conclusion, the court, amongst other things, ordered the defendants to take back the garage and reimburse the plaintiffs with the original purchase price.