MNCB-KKG Update January 2012
Following a meeting of MNCB-KKG group the following update was agreed for release onto our web site www.kkg2011.com
Things have slowed down on the property scene over the festive season. The government clearly has had other priorities recently. However some progress on improving property matters, according to the government is continuing. So although there is apparently progress this is not as much as MNCB/KKG would like.
The Prime Minister, the Finance Minister and the Attorney General's Office and main opposition leaders have all agreed with MNCB and our eminent legal advisors that repossessions due to stealth mortgages are illegal and the Courts should find so. Well as everyone knows the Courts have not found this so to date.
The Prime Minister had agreed that there should be a moratorium but the Attorney General's Office whilst agreeing about the illegality of stealth mortgages say a moratorium is not needed. So they have agreed to make the illegality of stealth mortgages known to the Judiciary before there are further hearings, so watch this space. Many lawyers we talk to are not convinced that this will actually happen so we await the outcome with great interest. If this promised action by the Attorney General's Office does not halt the repossessions, we will be back to the prime Minister's Office again. Does this have a familiar ring to it?
So in a nutshell; we have agreement over several government departments and the main opposition parties that stealth mortgages as a basis for repossession and eviction is illegal. We do not have agreement on the best way to solve the problem but a different idea is to be tried. We can only hope the Courts support the Attorney General’s Office new initiative.
The illegal Kulaksiz 5 stealth mortgages with the resulting flawed repossession procedures are, we understand, one example to be used as a test case for this contention of the Attorney General's Office. It is understood that this K5 main case will be heard in April in the meantime applications are being made to the court to suspend K5 evictions and house sales by the creditor bank. The creditor bank is the bank of the developer who sold the properties before taking a small bank loan from them at exorbitant interest. None of K5 house buyers have borrowed any money from this bank. To remind you of the figures, the home owners paid about £800,000 pounds for their houses before the builder later borrowed £40,000 only from the bank. The bank that has ratcheted up the interest charges and now says it owns everything. Seem fishy to you? To date all K5 eviction cases that have applied to the court for a stay of proceedings until after the main case is heard have been successful in getting a deferment. But it has not gone away, so we must now wait to see if the Attorney General’s action has any influence on the courts.
As we said earlier not everyone is convinced that this solution proposed by the Justice Ministry will give a just result. This and the apparent endless litigation and expense for house buyers to prove that property they have paid for in full is rightfully theirs is continuing to depress the property market and create more unemployment in the TRNC.
Many house buyer victims tell us they are not convinced that the TRNC government still are doing enough to remove this very obvious flaw with property law. House Buyers are in despair and do not think they will ever get justice in the TRNC. So many are now in the early stages of filing cases in the ECHR, we are aware of over 250 applicants considering this action across the TRNC.
Whilst cases do differ in detail, it is easy to understand why many home owners are now making direct application to the ECHR for justice. We can only hope that the Prime Minister or the Attorney General will act urgently and decisively to stop further suffering to buyers and damage to the TRNC economy.