The black hole of renting a residential property

Tenant: “Just received the first bill in 11 months from the landlord, it’s over €5,000, how can this be possible and that doesn’t include the contracted €50 I have been paying every month?.“

Adviser: “I suspect you are on the domestic rate; did you ask your landlord to endorse Form H when you moved in? Did you rent through an agent?”

Tenant: “I asked but she said as it was her name on the bills and as she is Maltese I didn’t have to worry. The agent said it was between me and the landlord and that they couldn’t insist on a rate”

Adviser: “Let’s get some facts down.

“The ‘domestic’ rate for utilities is linked/applied solely to secondary properties. Example: Summer homes, rarely used properties. ‘N/B rarely used properties.’ The ‘domestic’ rate is not and should not be used in properties where someone lives year in year out, with residential consumption.

“The idea that just because a Maltese national’s name is on the bill does not automatically imply the residential rate. Currently, that has to be applied for via ARMS Ltd Form H. This is not a change in the name on the bills but simply a registration of the tenants residing in the property and has no charge connected to it.

“Unlike residential bills, which come every two/three months, the domestic-rated property bills come far less frequently, in some instances once a year. On a property rarely used, that could be acceptable. In situations such as these, the landlord presents the tenant with a hand-written bill, normally done via the ARMS calculator, once a month.

Tenant: “Should tenants be obliged to pay these amounts?”

Adviser: “Would we pay any other bill without an actual bill?

“In how many instances would we pay a bill that didn’t have our name on it?”

It usually takes tenants a few months to realise that the utility rate on their property is excessive and that’s when the deerstalker and magnifying glass come out and they eventually find the ‘F law’. They are indeed, in some instances paying almost double. The heels dig in, animosity between tenant and landlord ensues, and the tenant’s refusal to pay starts the journey into the black hole.

There is very little help for those free falling down into the darkness. They are living in their Primary residence, absolutely 100% entitled, as decreed by ARMS to the residential rate, yet paying the rate for a second home! Domestic!

The darkness continues as the tenant seeks legal advice and finds that most experts do not have a clue about the situation. What do you mean you are paying more? (€50 per half hour) ‘Deer in the headlights look.’ It is much easier to give legal advice to the landlord on “unpaid bills”, no explanation needed.

If the situation wasn’t bad enough it is about to get a whole lot worse.

The alarm bills start ringing when you go to pay another bill via online banking, and find your worst nightmare. A hack? Fraudulent behaviour? Credit card stolen? You check another account.

Palpitations, nausea, fear. You call the bank to be told your accounts have been ‘garnished’!! Darth Vader has struck!

As much as the rules surrounding garnishee orders require only the amount garnished to be held, and that the person being garnished be left with enough to live on, that is hardly important in most of these situations. A signature on a garnishee order is just so much easier and cost effective, and they don’t need to know anything else, or want to. Evidence? What evidence!

The law regarding garnishee orders is rarely adhered to – too much like hard work – so the tenant finds his/her bank accounts frozen with no immediate recourse. I say no immediate recourse because the tenant has to first find an expert willing to investigate and understand the problem. Most will blame ARMS and tell you to take it up with them, but as a tenant on the domestic rate, not registered at a property you-donot-exist in the eyes of ARMS Ltd.

Very few will lay any blame with the landlord who, on deciding to rent a property didn’t see any further than the cash. (Most don’t accept bank transfers etc). They don’t realise it is their responsibility to inform tenants about the utility rates and that if they are renting their property as a residential concern the tenant must be placed on the residential rate!

Very few will blame the agents and agencies who do know of this situation, but informing tenants of the domestic rate versus the residential rate “is not within their remit”.

Very few will blame the Management Companies because they don’t want to bother their owners with this 50% more cost, trivia and would rather sit behind a desk accepting ‘cash payments only’.

We could all blame A-Gentleman, but that would just be a waste of breath

No, they will all blame the tenant for not being aware (like they are) of the many corrupt, discriminatory, criminal, illegal connotations of renting a property in Malta, namely the domestic versus residential ‘loophole’.

Meanwhile, back at base camp, ARMS and Enemalta have their own black hole of debt, but how much of that is accurate? How much of the monies owed to these companies is legitimate billing? How much of that alleged debt is made up of tenants who absolutely refuse point blank to be ripped off any longer. Let’s face it, ARMS knows about this injustice; in fact you could say they encourage it, but I don’t see anyone hitting them with a garnishee order.