Legal Analysis of Actio de In Rem Verso in Malta: Case of Xuereb v. Vella
In the case Alexander Xuereb vs Mark Anthony Vella, Hon. Dr Joanne Vella Cuschieri, sitting in the First Hall, Civil Court examined the elements of the actio de in rem verso.
The actio de in rem verso is a Roman law principle which, although expressly incorporated into Maltese law in 2007, has long been embedded in the jurisprudential history of the Maltese Courts. It is characterised as an action arising out of a quasi‑contract. Quasi contracts are lawful and voluntary acts which create an obligation towards a third party, or a reciprocal obligation between the parties.
The legal basis of the actio de in rem verso is laid down in Article 1028A of the Civil Code which establishes that “whosoever, without a just cause, enriches himself to the detriment of others shall, to the limits of such enrichment, reimburse and compensate any patrimonial loss which such other person may have suffered. If the enrichment constituted a determinate object, the recipient is bound to return the object in kind, if such object is still in existence at the time of the claim.” This action is rooted in the doctrine of unjustified enrichment, and they are enforced by courts to rectify situations where one party has received a benefit without there being a direct corresponding obligation to compensate the other party.
Article 1028B further provides that “the actio de in rem verso may not be exercised where the person who suffers the loss may take another action to make up for such loss”. Therefore, the actio de in rem verso is an action of last resort and may not be exercised where the aggrieved party has another action available to recover the loss.
The Background
In this case, the Court examined a dispute arising from a promise of sale. Under the agreement, the respondent undertook to sell, transfer, and assign the airspace to the applicant, who intended to develop six apartments subject to the terms of the promise of sale. There was a barter arrangement between the parties whereby part of the price was not to be paid in money but through the applicant’s provision of materials, construction works and finishing for both the airspace development and the respondent’s adjacent mezzanine/ maisonette.
The promise of sale was conditional upon the issuance of planning permits. While the planning authority application was pending, the parties agreed that the applicant could commence works in the mezzanine that did not require planning authority approval. The mezzanine served as the respondent’s residence, and he granted the applicant access for the works to proceed. However, in January 2025, the promise of sale lapsed due to the non issuance of the development permit, and subsequently, the respondent requested that the works be stopped and that the keys be returned.
The applicant claimed that over the three month period he had carried out substantial works including tile removal, grouting, gypsum installation, drainage, plumbing, and other improvements, amounting to €21,047.19. As these works were executed in the respondent’s property and for his benefit, the applicant sought a declaration that the respondent was responsible to reimburse him for the value of the improvements made.
The key issues before the Court
The central issue before the Court arose from the non-fulfilment of a suspensive condition attached to the promise of sale, namely the approval and publication of the development permit. In this context, the Court was required to assess whether, notwithstanding the lapse of the promise of sale, the applicant could nonetheless advance a claim based on the actio de in rem verso in respect of works carried out prior thereto.
Principles Identified by the Court
At the outset, the Court examined the principles governing actio de in rem verso, referring to a number of well established judgments on the subject. One such judgment emphasised the equitable nature of the actio de in rem verso. The governing principle is that no person should enrich themselves at the expense of another (nemo licet locupletari cum aliena iactura). Its purpose is to restore equilibrium between the patrimony of the party unjustly enriched and that of the party who carried out or financed the works that produced the enrichment.
Since this action is grounded in the institution of quasi contract, it must be shown that the act was lawful and voluntary, that it gave rise to an obligation, and that it was not carried out in defiance of the express prohibition of the interested party. However, the Court noted that this assertion alone is not sufficient for the success of the action. It must also be established that all the essential elements of the actio de in rem verso are satisfied in the specific circumstances of the case.
These elements are:
- the enrichment, meaning that the benefit conferred must result in an advantage or utility for the enriched party,
- the causal link, meaning that the enrichment must be the direct consequence of the claimant’s act, reflecting the same relationship that exists between a cause and its effect, and
- the unjust character of the enrichment, meaning that the enriched party cannot rely on any juridical basis that would legally entitle them to retain the benefit
The Outcome of the Court
The Court noted that it was necessary to examine whether the elements outlined above were all satisfied in the circumstances of the case.
The actio de in rem verso as applied in the present case, requires that the respondent has obtained, or is in the process of obtaining, an advantage or utility as a result of works or services carried out on their property without payment, or in a manner through which they have saved expenses and thereby become enriched at the claimant’s expense. The Court observed that the applicant had produced various invoices for works performed and for materials purchased at his own cost, all of which were used in the respondent’s property.
The link between the applicant’s reduction in patrimony and the respondent’s enrichment is established by the fact that the improvements carried out in the respondent’s maisonette resulted in a corresponding reduction of the applicant’s patrimony and a direct benefit to the respondent. The works and materials improved the habitability of the property, and the enrichment accrued solely to the respondent as the owner. Meanwhile, the applicant remained unpaid for both the labour performed and the materials he personally financed.
Decision
For these reasons, the First Hall of the Civil Court concluded that the respondent lacked any lawful basis to retain the advantage derived from the works carried out by the applicant. In reaching this conclusion, the Court placed particular emphasis on the fact that the works and materials had been expressly requested and accepted by the respondent, with the resulting benefit accruing exclusively to him following the recission of the promise of sale. On this basis, the Court found that the elements of the actio de in rem verso were satisfied and accordingly upheld the applicant’s pleas, declaring the reimbursement claim to be due.
Disclaimer: Ganado Advocates is responsible for contributing this law report but was not in any way involved as legal advisor for the parties in the judgment being covered in this law report. This article was first published in ‘the Malta Independent’ on 18/02/2026.
