Malta - Time Bars

Date: 26/01/2017
Author: John Bugeja
Source: H. Vassallo & Associates Limited
Malta - Time Bars

TIME BARS UNDER MALTESE LAW

Statutory time bars in contract and in tort

The Civil Code is the primary source governing time limits for bringing different types of legal claims. The most relevant for the shipping industry are those for contractual and tortious claims. In particular the Civil Code defines extinctive prescription as the mode of releasing oneself from an action, when the creditor has failed to exercise his right for a time specified by law. (1).

Ordinarily, prescription of an action commences to run from the day on which such action can be exercised, irrespective of the state or condition of the person to whom the action is competent. Prescription cannot be renounced beforehand, and in civil proceedings, the Court may not of its own motion give effect to prescription where the plea of prescription has not been set up by the party concerned. Yet, Maltese Law recognises that prescription may be set up at any stage of the proceedings, even on appeal.

With regard to an action for damages, prescription is suspended during the time before the commencement of the cause when negotiations are taking place between all or any of the parties or their insurers having opposing interests in the claim. (2).  Thereafter, prescription continues to run as soon as the cause of suspension ceases.

Prescription is interrupted by the filing of a judicial act in the name of the owner or of the creditor, served on the party against whom it is sought to prevent the running of prescription, showing clearly that the owner or creditor intends to preserve his right. (3).  The interruption is deemed operative even though the demand, protest, or other judicial act is null owing to a defect in its form, or is filed before a court which is not the competent court. However, no interruption takes place if the act is not served before the expiration of one month to be reckoned from the last day of the period of prescription. Nevertheless, if the party to be served is absent from Malta, service is deemed to be effected by the publication of a notice in the Government Gazette, within a month to be reckoned from the last day of the period of prescription.

Similarly, prescription is also interrupted if the debtor or possessor acknowledges the right of the party against whom such prescription had commenced (4), or by a payment on account of the debt, made by the debtor himself or by a person acting in his behalf. (5).

Specific time-bars

The Civil Code is complemented with other provisions in different legislations that cover specific instances. Most notably, and most relevant to this guide, are the provisions contained in the Commercial Code, the Carriage of Goods by Sea Act and the Ports and Shipping Act. Yet an important distinction is to be made here since unlike the generic statutory provisions contained in the Civil Code, the prescription periods contemplated by these specific regulations are periods of forfeiture which are therefore not susceptible to suspension or interruption.

Noteworthy is Article 541 of the Commercial Code which provides that all times fixed by any express provision of this Code for the exercise of any action or right of recourse arising from commercial acts, are peremptory in nature. This was also confirmed by the Maltese Courts in United Acceptance Finance Ltd vs. John Borg decided on the 26 March 1999. It follows therefore that the benefit of the restitutio in integrum that permeates the generic provisions of the Civil Code and that could be enjoyed by reason of any title, cause or privilege whatsoever, does not apply in relation to these specific instances.

Specifically in relation to contracts of carriage, Paragraph 6 of Article III of the Carriage of Goods by Sea Act provides that the carrier and ship is discharged from all liability in respect of loss or damage unless suit is brought within one year after delivery of the goods or the date when the goods should have been delivered. This period has been confirmed to be a peremptory one by the Court of Appeal in The Cargo Handling Company Ltd. vs Messrs John Abela Limited decided on 7 July 2003. Moreover, in the case Peter Sammut vs. Sullivan Maritime Limited, decided on 28 March 2014, the Court of Appeal confirmed that relative peremptory periods affect the right enjoyed by a party in relation to the proceedings, rather than the proceedings themselves.

General Provisions

Nature of ClaimTime Bar
Contract ClaimsActions for the payment of any other debt arising from commercial transactions or other causes are barred by the lapse of five years, unless such debt is barred by the lapse of a shorter period or unless it results from a public deed.
Tortious claims

(including bodily injury claims, and claims for latent damages)
Actions for damages not arising from a criminal offence are barred by the lapse of two years.
Tortious claims

Actions for damages arising from criminal offence.
Civil actions for damages arising from criminal offences, attract the prescription period rules laid down in the Criminal Code relating to the prescription of criminal actions.

Specific Provisions

Nature of ClaimTime Bar
Contract of carriage claimsRegulated to by the law governing the contract of carriage. Outbound shipments are regulated by the Hague Rules as incorporated into Maltese Law in respect of which the carrier and the ship is discharged from all liability in respect of loss or damage unless suit is brought within one year after delivery of the goods or the date when the goods should have been delivered.
Freight claimsActions for payment of freight are barred by the lapse of one year from the completion of the voyage.
Claims against terminal and port operatorsActions against the terminal and port operators for any loss or damage caused to
any person, vessel, goods, vehicles or other things whatsoever on board a ship are barred unless (a) a claim in writing, giving such particulars as may reasonably be necessary, is given to the port or terminal operator, as the case may be, not later than six months after the date on which the goods were accepted by the terminal or port operator; (b) the action is commenced within twelve months from the date aforesaid.

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