Selling Co-Owned Property under Article 495A
- 7 hours ago
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In Malta, it is common for property to be owned jointly by several persons, particularly following an inheritance. This can create practical difficulties — especially where some co-owners wish to sell, but others refuse, delay, or simply cannot be traced.
In such cases, Article 495A of the Civil Code provides a solution.
This provision allows the court to authorise the sale of co-owned property even where not all co-owners agree, provided the legal requirements are satisfied and the dissenting co-owners are not seriously prejudiced.
In simple terms, if the majority of co-owners wish to sell, but the minority refuses or does not appear for one reason or another, the majority may file an application before the First Hall of the Civil Court asking the court to authorise the sale. The majority is assessed by reference to the value of the shares held by each co-owner, not simply by headcount.
If the court is satisfied that the legal requirements have been met, it may authorise the sale in accordance with the wish of the majority.
The main legal requirements for using Article 495A are that:
The property has been co-owned for more than three years;
There are no ongoing proceedings for the partition of the property;
The case is submitted by the majority in value of the shares;
The sale will not seriously prejudice the minority.
The key safeguard in Article 495A is that the court must be satisfied that the minority owners are not seriously prejudiced by the sale. This assessment is normally limited to assessing whether the sale price is fair. Proceedings under Article 495A therefore tend to require a valuation of the property to justify the proposed sale price. However, apart from the value, the court may consider any other factors that may prejudice the minority, including any prejudicial terms and conditions of the proposed sale.
In practice, the proposed sale is often linked to a promise of sale agreement (konvenju) with a prospective buyer. This promise of sale would be entered into by the majority of co-owners, and would be subject to obtaining court authorisation for the sale of the property as a whole.
Article 495A is particularly useful in Malta because many properties remain tied up in long-standing co-ownership. This remedy allows co-owners to sell their property and terminate the state of co-ownership, in situations where the minority co-owners do not want to sell or where they are unknown or cannot be traced.
