Akfinans Bank appears to have ignored TRNC Mortgage Law 11/78


It is now so obvious that Akfinans is a Bank on the ropes. That it took so long to introduce Mortgage Law 11/78 section 21 into the Kulaksiz 5 -v- Akfinans Bank Limited legal case is a mystery to us all. However it is there now and seems to be being taken very seriously.

The Akan Kursat of Aga Development shareholding fame, alongside the notorious felon Gary Robb was a man under pressure in the Appeal hearing of the 19th September 2012 and the saying ‘clutching at straws ‘ was never more true.

Mortgage Law 11/78 section 21 is unambiguous, not open to any other interpretation.

Section 21 of Mortgage Law 11/78 is the most important rule to protect the rights of of property purchasers in North Cyprus. The rule states that if someone owns land but allows a Contractor to build on it, then sells the villas/houses then the Contract of Sale remains valid even if the landowner does go on to take a mortgage on the site. This means that the Mortgage Holder (in K5′s case the Bank) are obliged to execute the conditions of the contracts and also separate the houses from the mortgaged land and give the purchasers whatever the contract demands and then execute the mortgage on whatever remains. That would be the land and the three villas owned by the landowner.

In 2009 this was what was suggested to the Bank, when the debt had been reduced by the court to 350,000 lira. You do not need to be Einstein to realise three villas and the land would have more than covered the then outstanding debt. At that time no one had shouted Mortgage Law 11/78 section 21 and one has to wonder why the various Advocates who did the initial conveyance for the purchasers did not bring Law 11/78 section 21 to the notice of their clients. Would this be ignorance or negligence or worse?

Clearly the taking of a mortgage on their land was kept secret from the K5 purchasers and that secret only came to their attention in early 2008. They were never approached to ask their permission to take a mortgage on their land. If they had been, the whole plan would have been scuppered because they would not have given permission.

My final question is this. Why do the Bank think they can ignore the law, why do the brazenly rub the noses of the true owners in the dirt by making it obvious they have no intention of removing the Turkish families from the villas they occupy? It is clear that the only villas the Bank can legally take are the ones occupied by the Turkish families and the one lying empty, in short the three villas given to the landowner by the builder in payment for the land. These three villas were the only ones ever legally available to use as security for the loan they gave to Abdurrahman Guney and Yuksel Yilmaz back in November 2005. It makes you wonder if Akfinans Bank, and other Banks in the same situation, have contempt for the TRNC legal system. “

The ‘smoke and mirrors’ arguments introduced by Akan Kursat are just that, diversionary tactics.

The one important question for the Courts to decide, is, did the Bank follow the letter of the law with regard to Mortgage Law 11/78 section 21?

The argument that some of the owners knew about the mortgages, although false is not relevant. Did they sign and give permission for a mortgage to be taken on THEIR PROPERTY? No, they did not!

The argument that they can afford to lose their property. The Law does not and should not differentiate between the rich and the poor. The only question the Law is interested in is, were these people ever made aware of this transaction at the time it took place? The answer is a resounding NO!

Did the Bank know there were properties on this land when they gave the mortgage? Mr Kursat can tell the court they did not until he is blue in the face, but the existence of the Survey commissioned by the Bank in March 2005 will prove he is being economical with the truth. The evidence of Abdurrahman Guney, former Director of Kulaksiz Construction Limited on oath in the hearing that culminated on the 26th August 2011 also contradicts this claim. So why then did they submit a document to the Tapu describing the security as Tarla (land)? Was this a deliberate act to misinform, was it in fact larceny?

Did the landowner give permission for the sales, Mr Kursat allegedly claimed he did not. Why then does his signature appear on Pauline Read’s contract. Why did he befriend Pauline Read and her partner, invite her and her partner to a barbecue in September 2005 to celebrate the sale and why after she moved into her bungalow was he a frequent visitor to her home (now occupied by Ertug Kader, Bank co-owner), bringing her copies of the Pegasus in-flight magazines. Yuksel Yilmaz the landowner was a Manager of Pegasus Airlines in Lefkosa then but is now the Manager at Hatay Airport for the same company. A transfer that was made when things were getting too hot for him in North Cyprus. You must remember that the Landowner was living on Kulaksiz site, so unless he was blind, I never saw him using a white cane, he could not fail to know the properties were sold.

This clearly still has a long way to go, but even a cynic like me is beginning to feel cautiously optimistic for the Kulaksiz 5 and by association all victims of Bank mortgages taken after they purchased.

Power to the people.

Citizen Smith

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