Kulaksiz 5 when TRNC Mortgage Law 11/78 is Finally Enforced


It is outrageous that Conor O’Dwyer should be fined for telling the truth. His builders acted way outside the law and now Cypriot fashion, they are rewarded. I do hope he will appeal this decision and end up in the European Courts where fair play is more likely.

Another outrage that comes to mind is the total lack of self respect shown by a certain ***DELETED*** Bank. They cry foul when a picture of the villa Ertug Kader claims as his is taken and then he puts FOR SALE signs outside seven of the villas owned by the beleaguered purchasers on Kulaksiz 5.  At the same time he brazenly leaves without FOR SALE signs the villas occupied by Turkish families of the landowner, the villa owned by Jel and Jo Clark, and Pauline Read’s villa they now occupy and refer to as his.

What does that tell you? With regard to Pauline Read and Eva McCluskey’s villas; it tells you they expect no consequences for the fact they broke into both and took them without bothering to get legal sanction and as usual there will be no consequences. Jel and Jo Clarke have arrived at some sort of deal with the Bank, their choice and I am not condemning them for it.

The Turkish settler landowner is the author of all the problems the true owners have had and yet they appear to be avoiding the worries the others have and, unless the Bank are deliberately trying to mislead, they will be allowed to keep their ill gotten gains. If I were a cynical person I would hazard a guess that everything is going according to plan, the plan hatched back in 2005 by Abdurrahman Guney, Yuksel Yilmaz and the Bank. Why else would the borrowers have even contemplated taking a loan as small as 100,000 lira and allowing an interest rate of 250% to be applied?

Now look at the situation with Mortgage Law 11/78 section 21 applied. The borrower in the person of Yuksel Yilmaz had a perfect right to take the loan giving the three villas he received from the builder in payment for the land as security, no one disputes this, they were all in his name. He did not have the right to give the 10 villas owned by the British purchasers as security without first getting the permission, in writing, from the 10 British owners. MORTGAGE LAW 11/78 section 21 clearly confirms this.

Why then did the Bank allow this and why did they put TARLA (land) on this mortgage document? The initial argument put forward by the Bank that they were unaware of the villas, and thought it was just land, was blown out of the water by the production of the Survey commissioned by them in March 2005. Abdurrahman Guney the borrower did confirm this in his evidence to the court during the hearing that culminated on the 26th August 2011. He went further and allegedly confirmed that the Bank had looked at the Contracts of some purchasers too. How K5 lost that case is a mystery to me. One clue comes in the Judges decision in his report where there is no reference to Mortgage Law 11/78 section 21 and as a layman I can only assume this was not introduced into the case by K5’s defence Advocate.

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 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 ***DELETED*** Bank, and other Banks in the same situation, have contempt for the TRNC legal system. I wonder how the judges at the K5 appeal feel about this.

Let us hope the judiciary will at last rule in favour of the Kulaksiz 5 and let natural justice take its course.

Power to the people

Citizen Smith

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