It is common ground that the provision of law 87 (I) 2018 "on the transfer and mortgage of real estate" which inadmissibly accepts the division of the right of way and indiscriminately gives the banking institution the opportunity to divide the original single mortgage into two (2) or more mortgages and to sell at least part of the borrower's real estate is completely legally unacceptable and obviously socially unjust.
Extremely provocative is the "study" shown by the banks regarding the "reverent" observance of the obligation to inform the borrowers by sending a notice to the mortgagee either by mail or by fax or e-mail for the above disbursement and the subsequent disbursement. of the right of sale.
This process, which is based "superficially" on the law, is in direct and acute contradiction with European legislation and the acquis communautaire, and in particular with Directive 2019/1023 / EU, which establishes the (preventive) framework for debt restructuring and Insolvency, published on 26 June 2019 in the Official Journal of the European Union, shall apply from 27 July 2019 and shall require that it be incorporated within two years into the internal legal systems of the Member States and that the necessary effective implementing measures be taken.
The purpose of this Directive is to ensure the effectiveness of the Member States' national framework for restructuring, insolvency and debt relief procedures for insolvent or over-indebted debtors, in particular by limiting the length of these proceedings.
Reading Article 5 of the Directive, one could - at first glance - argue that the division of mortgages provided by Law 87 (I) 2018 is in accordance with European law, but if you look deeper into the letter and the spirit of the law, you will eloquently form the belief that this is provided as the exception to the rule and not as the rule itself.
In particular, Article 5 of the Directive provides that Member States shall ensure that debtors subject to precautionary restructuring procedures retain full, or at least part, control over their assets and the day-to-day operations of their business.
Thus, partial retention is provided only as an exception and not as a rule, as illegally provided and imposed by the above domestic legislation that goes beyond the letter and purpose of the legislator.
A second issue that arises is the cessation of individual prosecutions and in this case the sale of the borrower's property or business, since both in the first instance the Member States can provide that "the suspension of individual prosecutions is general, covering all creditors or sub-creditors or categories of them ", so there is a discretion of domestic law to choose.
Therefore, the political leadership should be judged, that is, whether it has the political will and the strength and to what extent to protect its citizens against the greedy appetites of credit institutions or to leave them in the lurch.
A draft law (Solidarity, EDEK) has already been submitted on this territory, requesting the exemption of the sale of the first (1st) residence up to 350.000 euros, commercial housing up to 150.000 euros and real estate mortgages, co-borrowers or guarantors used for agricultural purposes. , dairy or livestock up to the amount of 200.000 euros.
As far as the second degree of jurisdiction is concerned, it is obligatory to bring the dispute before a "second higher judicial authority", where again the possibility of suspending the execution of the restructuring plan or parts of it is provided, if deemed necessary and appropriate to safeguard the interests of one party.
It is therefore possible, permissible and socially permissible to issue (temporary or special prohibition) decrees to stop the sale until the judgment of the second highest judicial authority, as the sale effectively cancels the purpose of the directive, abolishes the protective scope of domestic law and renders meaningless the judgment on the restructuring plan, as the debtor who loses his property ceases to have any interest in the observance of the restructuring plan.
In addition, in addition to the above substantive issues, there is also the issue of procedural treatment, as it requires the rapid establishment, consolidation of the necessary court proceedings as well as familiarization of judicial officials with them, as in the Law "On Courts (Amending) Law of 2019" Provision should be made for disputes related to banking facilities and cases that are at the stage of sale to be submitted to a Court of Special Jurisdiction in the District Courts and to be heard in absolute time priority, as they concern vulnerable groups of the population.
On the other hand, it would be wise to legislate the maximum time limits, so that there are no abuses and delays in the administration of justice, as the speedy resolution of the dispute is indeed in the interest of all parties involved, while giving justification to the objections. and the Central Bank, which, however, legally and socially unacceptable link the issue of delaying the trial with the legal issue of suspending individual prosecutions.
In other words, in this way they load the carelessness of the system that they are obliged to monitor and correct the distortions in the backs of the borrowers who are unable to react.
Alternatively, there may be a legislative provision to be carried out on a special electronic platform under the supervision of the State, following the submission of data by the borrowers and the preparation and recording of the restructuring plan electronically by this platform, which will have to be ratified by the Court. In this way, any complaint regarding the delays in the administration of justice is removed.
In the end and in any case, the individual disputes of the banking institution - borrower on this plan should be resolved on the basis and with the guarantees of the court, while finally there should be clear provision until the final completion of the above procedures for the granting of execution suspension. of individual prosecutions and sales, as if they are carried out or any sale is carried out, the protective content of the directive and the law become irrelevant.
Dr. Alexios Ch. Konstantinou, Lawyer / Academic, Member of Parliament for Famagusta with the "Solidarity" Movement