North Cyprus Property | Mortgage Law 11/78 | Harmony Site

North Cyprus Property | Mortgage Law 11/78 | Harmony SiteNorth Cyprus Property | Mortgage Law 11/78 | Harmony Site


Is the tide turning, did Kulaksiz 5 blaze the way for others?

Summary of Appeal Court Decision, Harmony Site. Dated 18th October 2012.

The following Decision of the Appeal Court, issued in Turkish was released yesterday.

[The interpretations in English after discussing implications with eminent Turkish speaking Lawyers. One must refer to the original Turkish for definitive interpretation.]

“Boysan Boyra was successful in their appeal to have action stayed with regard to the Harmony Estate repossessions. This decision has wide implications for others facing litigation due to stealth mortgages.

The judge has ruled that in excluding them and not allowing the house buyers to be heard in Court their natural justice has been breached. Consequently the lower court judgement should be stayed. Effectively ordering a full retrial or an opportunity for an out of Court settlement to be made.

The Judge found in this case no fault with the Lower Court decision because it only acted on the evidence as presented to it. That evidence was deficient, the homebuyers existence was not declared.

The decision confirms that under Law 11/78 Section 21 a thorough search needs to be conducted and all interests noted and informed before granting a mortgage.

The Judge said there was no evidence presented in the Harmony case that proved that the Bank (mortgagee) was aware of the homebuyers but the Landowner and the Developer were. The Judge also agreed that under TRNC Law 11/78 the District Land Officer had wide powers of enquiry prior to granting a mortgage, but in this case had not used them.

This is great progress and should make some Banks or Mortgagees think very carefully about whether they are acting illegally or negligently in rushing to grab other people’s houses in the TRNC.

Congratulations to Boyra Law and the TRNC Appeal Court for this momentous decision.

The Kulaksiz 5 Appeal Court Judgement following the 19th September 2012 hearing is still awaited.”

The above is courtesy of MNCB but there is an error in the final sentence.

The Appeal court granted a temporary Interim Injunction on some of Kulaksiz litigants properties, all with the exception of Pauline Read’s villa which has already been transferred into the name of a former Director of the Bank who, although the property is allegedly in his name, it is not him who spends weekends there, it is Ertug Kader and his family (Girne Branch Bank Manager). Is this yet another illegal act by the Bank, taking into account the fact that the mortgage was allegedly illegal from inception and the Bank broke into Ms Read’s villa when they repossessed it without a court order? The Interim Injunction was extended again on Wednesday of this week.

The Director, whose name Pauline Read’s villa now appears in at the Tapu, was on the list of Directors at the same time as Mr Ersin Tatar the current Finance Minister (2009). She was asked to find out who the person named as new owner was, it took her all of ten seconds once she arrived home on Wednesday 19th September.

There is a very basic difference in the two cases. The Court accepted that the Bank in the Harmony case had no knowledge of the owners even though the Landowner and the Developer did.

There is allegedly documentary evidence and testimony from the builder in the K5 case that the bank were fully aware of the existence of purchasers and that the properties had been sold.

Will Mortage Law 11/78 section 21 be the salvation for all mortgage fraud victims? Time will tell.

Power to the people

Citizen Smith

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