Notaries (Compulsory Insurance) Regulations, 2012

L.N. 446 of 2012

NOTARIAL PROFESSION AND NOTARIAL ARCHIVES ACT

(CAP. 55)

Notaries (Compulsory Insurance) Regulations, 2012

IN exercise of the powers conferred by article 10A(3) of the

Notarial Profession and Notarial Archives Act, the Minister for Fair

Competition, Small Business and Consumers has made the following

regulations:-

(1) The title of these regulations is the Notaries Citation and

commencement.

(Compulsory Insurance) Regulations, 2012.

(2) These regulations shall come into force on 1 January 2013.

In these regulations, unless the context otherwise requires

Interpretation.

"Act" means the Notarial Profession and Notarial Archives Act;

"breach" means any negligent act, error, breach of

confidentiality, omission, loss of documents, committed or happening

during the exercise of the notary’s functions under any law at any

time in force in Malta, and for any preparatory, ancillary or

consequential work done with respect to same, by the notary or by his

employees, and includes any act which causes damages resulting

from a criminal or fraudulent act by any of the notary’s employees in

the performance of their duties if they are in his employment, or in

furtherance of the notary’s functions if they are third parties engaged

by him;

"claimant" means any person who suffers damages due to a

breach;

"Court” means the Court of Revision of Notarial Acts;

"damages" means any damages incurred directly by a claimant

due to a breach, and includes any consequential loss suffered by the

claimant due to such breach;

"insurance provider" means an undertaking which has received

its official authorisation for the taking-up of the business of general

insurance in Malta and is authorised to write policies categorised

under class 13 of the Third Schedule to the Insurance Business Act; Cap. 403.

"Minister" means the Minister responsible for notarial affairs;

"notarial act" means an inter vivos act, a will, an act of delivery

of a secret will or any deed published in terms of articles 84A and

84B of the Act;

"Notarial Council" has the meaning assigned to it by the Act;

"notary" means a person, holding a warrant in accordance with

the Act to practise such profession, but does not include a notary

referred to in article 22 of the Act;

"notary’s employees" means one or more persons in the

employment of a notary and, or one or more third parties not in the

employment of the notary but engaged by the notary in the exercise of

the notary’s functions;

"policy" means a Professional Indemnity Insurance Policy

issued according to documented terms and conditions, provided by an

insurance provider to a notary;

"policy year" means the minimum period of one year during

which a notary is to be covered by a policy;

"run-off cover" has the meaning assigned to it in regulation 5.

(1) Without prejudice to the other provisions of these

regulations, with effect from 1 January 2013, every notary shall be at

all times adequately covered by a policy in terms of article 10A of the

Act for a minimum sum of two hundred and fifty thousand euro

(€250,000) or such other sum as may be determined by the Minister

from time to time (such limit is hereafter referred to as the "indemnity

limit"), against any breach, committed by the notary and, or the

notary’s employees in a policy year. The indemnity limit shall be

applicable to any one claim or to the aggregate of all claims made

against the notary in any policy year.

For the purposes of this regulation, judicial and legal costs of

whatever nature including those to defend a claim, and legal costs of

whatever nature including, but not limited to, those relating to a

compromise, shall be at the charge of the insurance provider and shall

be deemed to be included in the indemnity limit

Provided that nothing in this regulation shall preclude a notary

from being insured for a higher sum than the indemnity limit, or for

one or more "higher value transactions", under such terms and

conditions agreed upon between the notary and the insurance

provider

Provided further that a policy shall not extend to any breach

caused by a notary and, or the notary’s employees, which is otherwise

insured.

(2) The indemnity limit shall be exclusive of the sum that may

be agreed upon as excess to be paid by the notary on each and every

claim under the terms of the policy

Provided that for one or more claims against the policy in any

policy year, a notary shall not accept to pay an excess that exceeds,

with regard to each such claim, one point five per centum (1.5%) of

the indemnity limit established in the policy

Provided further that an insurance provider shall not demand the

payment of an excess as a condition to effect payment of damages to a

claimant, nor shall the insurance provider be entitled to deduct such

excess from any payment made to a claimant.

(3) (a)

The notary shall disclose to the insurance provider

his annual income from the exercise of his profession in the year

immediately preceding the policy year. The insurance provider shall

provide a policy based on such annual income

Provided that where a notary is unable to disclose to the

insurance provider his exact annual income for the year immediately

preceding the policy year in view of the fact that such preceding year

has not yet ended, a reasonable estimate shall suffice.

(b) Where the notary’s annual income for the year

immediately preceding the policy year does not exceed twenty-five

thousand euro (€25,000) or such other sum as may be established by

the Minister from time to time, the annual income for such preceding

year shall be deemed to be twenty-five thousand euro (€25,000) or

such other sum as may be established by the Minister from time to

time.

The notary shall also be required to be adequately covered Other cover.

by a policy against any breach which may have been committed by

the notary and, or the notary’s employees at any time within the five

years immediately prior to the beginning of the policy year

Provided that the policy need not extend to any fact, possibly

being a breach, occurring prior to 1 January 2013 which the notary

may have known or suspected to have happened, and which the

notary is obliged to disclose to the insurance provider prior to the

commencement of the policy.

(1) A notary shall no longer be required to be covered in

terms of regulation 3 in the instances mentioned in sub-regulation (4)

of this regulation.

(2) Notwithstanding the provisions of sub-regulation (1), a

notary shall be adequately covered by a run-off cover policy for a

period of two years immediately following the lapse of the policy

year in which he is covered in terms of regulation 3.

(3) For the purposes of this regulation, the provisions of

regulation 3 shall mutatis mutandis apply.

(4) The instances referred to in sub-regulation (1) are the

following

(a)

where the notary ceases from exercising his

functions for any of the reasons mentioned in article 14(1) of the

Act; or

(b)

upon the issue of a decree in terms of regulation

9(3).

Where a policy is transferred from one insurance provider

to another, the new policy shall extend to indemnify the notary

against any loss or claim made against the assured notary for a

retroactive cover of five years in respect of any breach which may

have occurred, or is alleged to have occurred, prior to the inception of

the new policy

Provided that such cover need not extend to any fact, possibly

being a breach, occurring prior to 1 January 2013 which the notary

may have known or suspected to have happened, and which the

notary is obliged to disclose to the insurance provider prior to the

commencement of the policy.

Where the insurance provider is entitled at any time to

avoid payment under a policy by reason of non-disclosure or

misinterpretation of facts by the notary when he completed his

proposal form to the insurance provider, the insurance provider shall,

instead of avoiding the policy, give full force and effect to the policy

except to those parts of the policy which are related to the

circumstances which ought to have been disclosed in the proposal

form and were not and, or which ought to have been correctly

interpreted by the notary and were not.

(1) Without prejudice to the provisions of article

94A(12)(a) and (18) of the Act and other relevant articles thereof,

every notary shall provide on an annual basis to the Notarial Council,

through one of the review officers defined in article 94A(1) of the

Act, a copy of the policy taken out in terms of the Act and these

regulations for the sole purpose of ascertaining that the notary is

validly and adequately covered in terms of the Act and these

regulations.

(2) In the event of doubt as to whether a policy is valid and

adequate in terms of the Act and these regulations in relation to a

notary, the Notarial Council shall, within one month of receiving such

copy, determine, after consultation with an insurance broker or an

independent insurance provider, whether the policy is so valid and

adequate and, if it is not, a reasoned decision shall be communicated

forthwith by registered mail to the notary concerned.

(3) A notary to whom a reasoned decision has been

communicated in terms of sub-regulation (2) shall address without

delay any concern raised by the Notarial Council and shall also send

by registered mail to the Council the necessary documentation to the

satisfaction of the Council.

(1) Saving the provisions of regulation 5 regarding run Exemptions.

off-cover, a notary shall be exempt from the obligation of being

insured in terms of regulation 3 whenever the Court, following the

notary’s application to this effect, exempts him from such obligation.

(2) In his application to the Court, the notary shall

(a) indicate the reason why and the calendar year or

years during which he does not intend publishing any notarial

act; and

(b) present a copy of his run-off cover policy valid for

two years immediately following the end of the policy year in

which he published his last notarial act

Provided that the last requisite shall not apply where the

notary did not publish any notarial act in the five years prior to

his application.

(3) Without prejudice to the provisions of sub-regulation (2),

the Court shall accede to the request of the notary, and issue the

appropriate decree in the following cases

(a)

where the notary intends to absent himself from

Malta for a period exceeding one year; or

(b) where the notary is suffering from ill-health or a

protracted medical condition restricting him from publishing

any notarial act; or

(c)

where the notary has taken up full-time

employment, and his contract of employment prevents him from

publishing any notarial act; or

(d) where the notary does not intend publishing any

notarial act for a period of time exceeding one year in cases of

parenthood where such notary has the care of a child of less than

four years of age; or

(e)

where the notary shows any other situation which

the Court considers reasonable after considering all the

circumstances of the case.

(4) The grant of a decree by the Court in any of the cases

mentioned in sub-regulation (3) shall not be interpreted as preventing

a notary from publishing a notarial act at any time, so long as he first

conforms to the provisions of the Act and these regulations with

regard to insurance and also applies to the Court for the revocation of

its decree with effect from the date when he is covered, or again

covered, in terms of regulation 3.

(5) A notary who has been partially incapacitated in terms of

the Act shall not, for the sole reason that he is partially incapacitated,

be exempt from being covered in terms of the Act and these

regulations.

€0.54