North Cyprus Properties, Prices

Linda and David Orams - Ruling of the European Court of Justice

North Cyprus Orams
1 April 2010
21 January 2010
13 November 2009
28 April 2009
20 March 2009
27 January 2009
20 September 2008
2 October 2007
13 September 2007
20 June 2007
8 September 2006
6 September 2006


Demopoulos, Nezire and Orams
Orams apply for Planning Permission to Demolish Property
UK Court of Appeal
Ruling of the European Court of Justice
Cherie Blair and the Bounced Cheque from North Cyprus
Property Negotiations - Presidents Talat and Christofias
Submissions to the European Court of Justice
The Orams make a press release from their villa in Lapta
Technical Queries forwarded to the European Court of Justice
UK Court of Appeal - Lord Phillips
Full Report of the Ruling by Mr Justice Jack
Cherie Blair represents the Orams in London


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28 April 2009 - Ruling of the European Court of Justice

Introduction and Summary of the Case to Date

1. Due to the inter-communal conflict in Cyprus and the attempts of Greek Cypriots to effect assimilation of the island into Greece, Turkey invaded Cyprus in 1974 in order to safeguard the rights of Turkish Cypriots. This led to an informal partition of the island, monitored by the UN. The north of the island became the Turkish Republic of North Cyprus (TRNC).

2. The conflict created a refugee problem and there was a movement of Turkish Cypriots to the north and Greek Cypriots to the south. These refugees were forced to abandon their property and became dispossessed persons. It is claimed that the family of the claimant, Mr Meletis Apostolides, lost land in the north.

3. Previous submissions to the European Union (EU) by dispossessed Greek Cypriots have been dealt with by the European Court of Human Rights (ECHR), and these submissions have resulted in several successful outcomes. The cases of Titina Loizidou and Myra Arestis are noteworthy. There is a reference to the husband of Ms Arestis later in this article.

4. The rulings of the ECHR were based on the principle that the property rights of dispossessed persons are not extinguished by their mere inability to possess the property due to the actions of other persons. In this context, the 'other persons' means Turkey and its military presence in North Cyprus. While the 'Cyprus Problem' remains unresolved, Turkey will be deemed to be continuing its unlawful denial of access to property by displaced Greek Cypriots. This principle is generally accepted by the international community, although there has been disagreement at the level of damages awarded.

5. While the rulings of the ECHR broadly endorsed the Greek Cypriot viewpoint, the fines were levied against Turkey and were eventually settled. However, the process was protracted and failed to deliver a 'knockout blow' to the TRNC property market.

6. Linda & David Orams, a British couple, from Brighton, purchased a property in 2002 on land which allegedly had the benefit of TRNC title deeds. Mr Apostolides claimed that the land had been occupied and owned by his ancestors and sought to reclaim the land.

7. A court in the Republic of Cyprus, that is the south of the island administered by Greek Cypriots, ruled in favour of Mr Apostolides and rejected an appeal from Linda & David Orams. These judgments had no practical effect as the authorities of South Cyprus have no power to enforce judgments in North Cyprus.


The Disputed Villa in Lapta

8. Mr Apostolides sought to have the judgment of the Greek Cypriot Court registered in the UK. This would empower a UK court to seize the assets of Linda & David Orams. Their UK assets allegedly include a property in Hove.

9. In October 2005, Mr Apostolides succeeded in registering the judgment in the UK. The Orams appealed and the registration was set aside in 2006. Mr Aposotolides was given leave to appeal and he did so. The UK Court of Appeal, under Lord Phillips in June 2007 referred five points to the European Court of Justice.

 

10. The judgment of the European Court of Justice (ECJ) dated 28 April 2009 is a response to the five points referred to by Lord Phillips.

Principles of the Judgment

1. There are two main bodies of EU regulations which affect this case –

First - Protocol 10 suspends the application of EU law in that part of the island of Cyprus over which the Greek Republic of Cyprus (GROC), by its own admission, does not control. This means that GROC cannot be held liable for infringements of EU regulations in North Cyprus, that is, the TRNC.

Second – Regulation 44/2001 seeks to promote EU harmonisation by ruling that court judgments issued by a member state are automatically recognised by other member states.

Comment – The accession of the island of Cyprus into the EU in 2004 has, with the benefit of hindsight, created serious problems. During accession negotiations, it was assumed that the UN brokered Annan Plan, which aimed to re-unite the island, would be accepted by both communities. However, the Annan Plan was rejected by the Greek Cypriot voters. Despite this rejection, the island of Cyprus joined the EU and the Greek Cypriot authorities of the South are therefore recognised by the EU as the legitimate government of the whole island of Cyprus.

This means that a court in South Cyprus can make a ruling on a range of issues in the North, including property and commercial matters. Provided any such ruling abides by the process of law, as determined by a court of South Cyprus, the ruling should then be automatically recognised by other EU member states, including the UK.

This is both alarming and unjust. The temporary suspension of EU jurisdiction in the North is not due to a transient situation such as the existence of pockets of unruly resistance to the government of the island. Cyprus has been effectively partitioned since 1974 and during that time the TRNC has become a peaceful and well administered region where the rule of law and respect for human rights meet international standards, and possibly excel those of South Cyprus.

The ongoing partition of the island, on an ethnic and religious basis, and the evident and longstanding inability of successive leaders of the two communities to reach agreement on substantive issues, means that a court in South Cyprus is unlikely to be in a position to dispense justice on a fair and disinterested basis with respect to matters affecting North Cyprus. The concerted and emotive campaign by the Greek Cypriot authorities, including the Greek Orthodox Church, to promote a rejection of the Annan Plan remains a vivid memory for seasoned commentators.

Content of the Judgment

1. The precise questions referred by Lord Phillips to the ECJ are listed elsewhere.

2. The ECJ ruling follows the recommendations of the Advocate General Kokott, delivered on 18 December 2008. This is the norm in these matters.

3. The full content of the judgment is available.

4. The judgment endorses the lawful nature of the proceedings of the courts of South Cyprus and has no objection to the judgments obtained in South Cyprus against the Orams being registered in the UK.

What Happens Next ?

1. It should be noted that the judgment of the EU does not rule on the intrinsic merits of the Apostolides vs Orams case. The judgment is a response to the queries raised by Lord Phillips of the UK Appeal Court.

2. The appeal of Mr Apostolides in the UK can now re-commence and Lord Phillips will have the benefit of the advice from the ECJ to assist in his deliberations.


Linda & David Orams

3. If the UK Court of Appeal follows the advice of the ECJ, they will agree to register the judgments of the court of South Cyprus which found in favour of Mr Apostolides. At this stage, it is likely that the Orams would be granted leave to appeal to the House of Lords. This could prolong the matter for several years.

4. If Mr Apostolides, at the end of the UK appeal process, is successful in registering the judgment of the South Cyprus courts, then he can make an application to the UK courts for the Orams to demolish the house in Lapta, North Cyprus and pay him compensation. If the Orams fail to comply, then he can make a further application to a UK court so that their assets in the UK are seized.

 

Technical Points

1. Regulation 44/2001 is limited to civil and commercial matters. It does not extend to ‘revenue, customs or administrative matters.' The ECJ recognises, in para 40 of the judgment, that it could be argued that the Apostolides vs Orams dispute is not simply a civil dispute between two parties.

This is an understatement. It is generally agreed that the dispute has been promoted and financed by the authorities of South Cyprus and that the defence of the case against the Orams has been financed by North Cyprus and/or Turkey. Mr Apostolides and the Orams are considered mere pawns in a larger game.

The penultimate paragraph of the ECJ ruling on this matter, para 45, concludes that the case is between individuals and that no public authorities are involved. The costs alone of the case to date discredit this opinion, and the ECJ could be challenged on this point.

More importantly, the land in dispute was taken into public ownership by the TRNC, subsequent to 1974. The TRNC then issued a title deed in favour of a Turkish Cypriot and made a grant of the land to him. Therefore, it was a public body, namely the TRNC, who took the land from the family of Mr Apostolides and not the Orams. This means that the complaint by Mr Apostolides cannot be understood without reference to the intervention of the TRNC. Therefore, the case is not a civil case between two private individuals, but involves a public body.

2. The process of law in South Cyprus could and has been challenged by the lawyers defending the Orams. The writ was handed to Mrs Orams at Lapta, but she did not sign for it. The papers were written in Greek and it took Mrs Orams some time to have them translated, by which time a default judgment had been made.

These issues, and several others, could lead one to the view that the Orams' rights were infringed by the courts of South Cyprus.

3. The default judgment of the South Cyprus court orders the Orams, among other things, ‘to deliver to Mr Apostolides free possession of the land'. It is not within the power of Linda Orams to comply with this ruling.

It is generally accepted that Linda & David Orams bought and paid for the land and property in accordance with the regulations of the TRNC, and that the land and transaction was registered with the TRNC authorities. TRNC title deeds are issued and guaranteed by the TRNC authorities and it is not within the power of Linda Orams to rescind a TRNC title deed nor declare it void. Her inability to comply with the judgment undermines the ruling and contradicts the ECJ claim that this is essentially a commercial dispute between private individuals.

The TRNC authorities have established an Immovable Properties Commission to deal with claims by dispossessed Greek Cypriots, and this would be the appropriate body to deal with Mr Apostolides' claim. A judgment by a Greek Cypriot court sitting in South Cyprus is not recognised by the TRNC.

4. Article 34 of 44/2001 states that a judgment shall not be recognised ‘if such recognition is manifestly contrary to public policy in the Member State in which recognition is sought.' In this regard, the Member State is the UK.

A convincing case could be made that registration of the judgment in the UK is indeed contrary to public policy. The UK government is a guarantor power with respect to Cyprus, and administered the island until 1960. The UK has supported efforts to end the international isolation of North Cyprus and promoted the Annan Plan for the re-unification of the island.

One could argue that the issues raised by the Apostolides vs Orams case should be resolved by a comprehensive political settlement rather than a series of ad hoc legal rulings which emanate from an unrepresentative and inevitably partisan court. Therefore, registration of the judgment would be contrary to UK public policy.

5. The impartiality of the South Nicosia court could be challenged.

It is reported that one of the judges who ruled on the case is the husband of Myra Arestis, although this has not been verified. Ms Arestis made a successful application to the European Court of Human Rights in 2006 against Turkey for depriving her of access to property in what is commonly referred to as the 'ghost town' of Varosha or Maras in Famagusta. Compensation payable was estimated to be 850,000 euros. Details of the case are listed elsewhere.

We understand that on the first day of the Appeal in London, Lord Phillips made the startling announcement that he had been the owner of a property in Kyrenia prior to 1974, which he sold to a Turkish Cypriot and that his parents also had a property in Kyrenia, which on their death was sold to Mr Rauf Denktas, who was President of the TRNC from 1983 to 2005. Lord Philips then allegedly offered to step down if either party objected. Neither party objected and the appeal was heard.

If this report is true, then it could be argued that the Greek Cypriot judge had a conflict of interest, or at the very least, his wife's experiences would be likely to prejudice his impartiality. Unlike Lord Philips, he failed to make a relevant disclosure to both parties and the Orams were certainly never given an opportunity to conisder the matter and raise an objection.

Strategic Options

1. The fact that the ECJ considers the inability of the government of South Cyprus to enforce its authority in the North as a temporary situation is a major problem.

The leaders of the two communities have given credence to this view by their continued meetings and positive statements concerning a unified Cyprus.

Following the April 2009 elections in North Cyprus, the National Unity Party (UBP) won 44% of the vote and the incoming administration is less optimistic as to the possibility of a positive outcome to these negotiations. The UBP favours a two state solution. Failing this, closer ties and possible union with Turkey appears inevitable.

If the temporary partition of Cyprus becomes permanent and there is a request for recognition of a separate state, the EU will be forced to review and possibly abandon its recognition of the government of the Greek Republic of Cyprus as the legitimate ruling body of the entire island.

2. The rights of dispossessed persons is an issue which affects Turkish Cypriots who lost land and property in South Cyprus, in addition to Greek Cypriots who lost land in the North.

It would be useful for several significant claims to be lodged by Turkish Cypriots with the European Court of Human Rights in order to dispel the myth that it is only Greek Cypriots who have been dispossessed. It is generally considered that Larnaca Airport is build on Turkish Cypriot land, and this would be a useful target.

In addition to submitting any such claims to the European Court of Human Rights, an application to the courts of South Cyprus could be made in order to highlight the reciprocal nature of this issue.


Felix the Felicitous Avukat

3. Appeal by the Orams to the European Court of Human Rights

Linda & David Orams have already lodged an appeal to the ECHR and complained that the default judgment issued by the Greek Cypriot court violated their human rights. Although we do not have full particulars of the claim, it is likely to include the contention that they were unable to receive a fair hearing in South Cyprus due to overriding political factors.

Progress through the ECHR is usually slow and tortuous and the timescale of the proceedings is unknown. At worst, the submission may persuade the UK Court of Appeal to postpone matters, whereas a successful outcome will result in a felicitous state of legal mayhem.

 

Conclusion

The Greek Cypriot campaign to destabilise the TRNC has undoubtedly been assisted by this ruling. The immediate impact will be to discourage EU nationals from purchasing property in North Cyprus. This will have a significant impact on the already fragile North Cyprus economy and tax revenues.

While there will undoubtedly be jubilation in sections of the Greek Cypriot government and media, this is a sad day for Cyprus. The Orams ruling, following on from the victory of the UBP in the election, marks a watershed in the history of the island.

For the last 10 years there has been a possibility that the island could be re-united, and there remain people within both communities who will resolutely cling to this dream and not lose hope. Despite the rejection by the Greek Cypriots of the Annan Plan, the Turkish Cypriot community continued to support efforts to negotiate a settlement and were prepared to make significant sacrifices of land and property to this end. There is also a significant number of Greek Cypriots, and sections of the media, who have spoken out against the myth that the 'occupied territory' of North Cyprus will once again be dominated by Greek Cypriots.

The tide of public opinion in the North is now turning, and the window of opportunity for a united Cyprus is closing. Permanent partition and a proposal for a two state solution are in the ascendancy.

Is it Safe to buy Property in North Cyprus ?

Due to the ongoing Orams' case, it is vital that prospective purchasers seek protection from any adverse claims from dispossessed Greek Cypriots. The average Estate Agent is unable to research the large number of properties on his books and usually has no information on the history of land on which his properties are built.

At Wellington Estates, we only build on land which we ourselves own. At present we have 4 development sites in TRNC. Each site has been paid for from our own funds, and we make extensive enquiries into the history of land before making a purchase. We are so confident in the integrity of the land we own that we can provide our customers with a LAND GUARANTEE. This guarantee means that, in the highly unlikely event of a challenge by a Greek Cypriot claimant, Wellington will settle any compensation claim or provide a full customer refund.

To learn more about this GUARANTEE OF SECURITY, please contact us.

Copyright © Leslie Hardy – 29 April 2009

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