WITHOUT PREJUDICE
Cyprus Law | Costly Justice-Free Minefield
The age old question is “which came first, the chicken or the egg?”
So which does come first, the Sales Contract registered with the Tapu or the Memorandum registered with the Tapu? Or is it as straight forward as that? Remember before an Injunction becomes a Memorandum the outcome of a court case asking for the Injunction to become a Memorandum has to be decided. So, if the date of the registration of the temporary Injunction at the Tapu precedes the date of the registration of the Sales Contract and then the petitioner goes on to win the case, a Memorandum will be issued. Will this Memorandum take precedence over the Sales Contract that was registered with the Tapu during the course of the case, but after the first temporary Injunction was registered with the Tapu?
The whole point of searching for land owned by the defendant is to ensure that when you embark upon the court case asking for a Memorandum, you will not be chasing an empty pot and wasting your money on the legal action you are embarking on; at least that is my opinion. I have to say that this is not necessarily the opinion of all. As an example, I know of many litigants who are advised to embark on legal action even though there is no chance of the litigant becoming the first to have a Memorandum on any asset of the defendant, simply because there is nothing s/he owns that is either Memorandum or Mortgage free. What, you may ask, is the point, if your likelihood of getting financial satisfaction is nil, and your capital outlay in court fees and legal fees is great?
If, like Pauline Read you start the process on the basis that the first search of the Kocan on which you put a temporary Injunction showed land free of major impediments and then go on to find the search was incorrect, you go to the final hurdle and find you just cannot do to others that which someone else did to you, is there any recourse in law to recompense you for the mistake made at the Tapu? The answer is, if you are a foreigner, no!
Now if you find understanding this as difficult as wading through custard, wait till we get to the touchy subject of mortgages.
When a mortgage is put on property, it does not involve a court case. Here the procedure is much simpler. The person whose name appears on the Kocan can apply for a mortgage on their land, but they must tell the lender the true status of that land. For example if their are properties on it, complete or in a semi built state. Some say they should even tell them of the existence of trees on it. In other words the mortgage deed should be truthful.
The reason being that the Tapu are then given the opportunity to ask the questions necessary for them to do their duty. If say, for example, 13 part built and almost fully built properties appeared on a Kocan, it might cause alarm bells to ring in the mind of the Tapu official who could then ask the Bank, “are any of these properties sold on to a third party, are there any Sales Contracts on these properties?” In this case, is the Bank guilty of lack of due diligence and duty of care to their account holders and share holders? I am not legally qualified to answer that question, only as a lay person can I ask it. For instance did the Bank have a survey carried out on the potential security, or did a bank official visit the site offered as security?
Although the procedure to obtain a Memorandum and a Mortgage can differ, the end result can be alarmingly the same; an Auction.
With both, it is often that the first time the people involved, who have Sales Contracts on the Kocan, get to know of an impediment on their purchase is when the Memorandum or Mortgage is enforced. How can that be right?
When someone takes a mortgage out on their own property and reneges on the debt, yes repossession and auction is acceptable. When someone borrows money and reneges on a debt, if the property they own is truly theirs, then yes an auction is acceptable.
However, how can it be acceptable to allow the repossession and auction of properties that are still in the former owner’s name simply because the Permission to Purchase process takes TOO long. The delay in this process gives the fraudulently minded time to practise this illegal act yet, from where I sit, there are no consequences for the dishonest and extreme consequences for the honest victims of this scam.
“Cheats never prosper” what a crock.
Power to the people
Citizen Smith
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