Title Deed solution soon?

Jacqueline Agathocleous
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THE HOUSE Interior Committee began discussions on three of five bills that aim to reform the legal framework for governing building permits and the issuing of Title Deeds – a move expected among others to bring in significant revenue to the state.

The remaining two bills, which have to do with the legal aspect of the matter, will be discussed at the House Legal Affairs Committee.

“All the bills are centred on the buyer,” Interior Minister Neoclis Sylikiotis said yesterday. “The main aim is to give land owners and buyers, Cypriot and foreign, the opportunity to receive Title Deeds. We also aim to improve the property sector’s operation and increase revenue, putting an end to this massive problem with the Title Deeds, which has exposed us as a state.”

Apart from the financial aspect, the bills are of great significance for the Cypriot property market, which is currently in great disarray due to difficulties in acquiring Title Deeds.

Thousands of home buyers, including many foreign nationals, remain without Title Deeds due to various reasons. More seriously, many owners can’t receive their Deeds because a developer failed or was unable to pay off the building’s mortgage. Many foreign investors, mainly British, have taken the matter to their own governments.

Sylikiotis yesterday said the state was finally on its way to finding a permanent solution to the problem, after two years of discussions and consultations with all parties involved.

“In June the bills were published in the Republic’s Official Gazette so interested bodies could submit their views,” he said. “We then held meetings with all political parties and interested parties. We used all the suggestions, views and proposals to reach a collective conclusion that will resolve the problems faced by thousands of home owners,” he added.

The bills include provisions that will offer buyers the ability to acquire Title Deeds, even if their property is part of a development with multiple units, which wasn’t the case up until now.

“For example, if someone applies for licensing to build 200 apartments and builds 50, those who own those 50 apartments will be able to apply for their Title Deeds straight away instead of having to wait for all 200 apartments to be complete; as was the case until now,” Sylikiotis explained.

Local authorities will also be given the right to act independently, impose fines when the law is being broken and generally ensure procedures aren’t stalled by crippling bureaucracy.

Sylikiotis explained that the fines will be calculated based among other factors, on the extent of the discrepancy.

The expected revenue, he added, had not yet been estimated. “In the first months of 2010, there was a 30 per cent increase in property sales compared to 2009. If we consider that a Title Deed costs around €7,000 to €8,000, the bills are expected to enrich the state by around €150 million a year,” Sylikiotis said.

Interior Committee Chairman Yiannos Lamaris of AKEL applauded the minister’s efforts to find a solution to the problem, “which has caused great hassle to Cypriots and foreigners, and has exposed our country abroad”.

“We have reached a point as a society, where the institutions need operate completely as soon as this law is passed; we can’t start having problems again, otherwise these discussions will be pointless,” he said.

Christos Stylianides of DISY said there was no doubt the new bills would reinforce Cyprus’ prestige abroad and turn it into a desirable investment destination. “The problem is multidimensional, but we have a duty to reach a collective conclusion as soon as possible,” said Stylianides.

Building permit numbers in Cyprus (February 2010)

David Crowther
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IN A PRESS release issued earlier today, the Statistical Service (CYSTAT) announced that the number of building permits authorized by the Municipal Authorities and the District Administration Offices during February 2010 was 813, comprising:

  • Residential buildings – 604 permits
  • Non-residential buildings – 107 permits
  • Civil engineering projects – 36 permits
  • Road construction – 12 permits
  • Division of plots of land – 54 permits

Focusing on the permits issued for the construction of residential buildings, these were approved for the construction of 1,691 dwelling units – 617 single houses and 1,074 multiple housing units such as apartments. Compared to the February 2009 total of 1,587 dwelling units, this represents an increase of 6.6%.

Building permit numbers in Cyprus (February 2010)
Source: Cyprus Statistical Service

During January and February 2010 building permits were issued for the construction of 2,981 residential properties. Compared to the same period last year, when permits were issued for the construction of 3,172 residential units, this represents a fall of 6.0%

According to the Statistical Service, building permits constitute a leading indicator of future activity in the construction sector.

Cyprus protesters march through Paphos

Nigel Howarth
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Leptos Buyers Action Group protesters demonstrating in Paphos
Leptos Property Action Group protesters marching through Paphos

EARLIER today a group of around a hundred members of the Leptos Buyers Action Group (LBAG) and their supporters held a peaceful demonstration and march along a busy Paphos seafront demanding their Title Deeds.

Most of the protesters I spoke to said that they had been waiting for their Title Deeds for many years. Many said they were outraged by the closure of the Cyprus Property Action Group website following a writ against Denis O’Hare, the website’s owner.

Some told me that the Land Registry had carried out Title searches on their behalf. These show that the land on which their properties is built had been mortgaged to the bank by the developer prior to them buying – and in some cases those mortgages amounted to many millions of Euros.

Many of the demonstrators felt intimidated and refused to give me their names out of fear of reprisals being taken against them. But Tricia Sabey, a LBAG co-ordinator, who has her Title Deeds told me she had nothing to lose by speaking up.

I asked Mrs Sabey what the protest was trying to achieve. “We wanted to let people know that there are €5 billion of toxic debt owed by the developers to the Cyprus banks. We believe that the Cyprus property market is heading for a crash; just like the US sub-prime market”.

Mrs Sabey told me: “I thought the protest went very well. We achieved our aims and it was a peaceful demonstration. We wanted to reach the wider public in Cyprus, not just British expats. We wanted to reach the Cypriot market, the German market and the Russian market – and we got our message across to a wide spectrum of people here in Paphos today.”

Eleven year pursuit of justice takes heavy toll

Stefanos Evripidou
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Eleven year pursuit of justice takes heavy toll

A BRITISH woman yesterday recounted how an 11-year pursuit of justice, which won her and her husband a landmark Supreme Court ruling had ultimately cost the couple their marriage and his health.

The Supreme Court’s decision last week to award the couple Muriel Beaumont, 73, and Clifford Sims, 78, around €120,000 as a result of their lawyer’s negligence in a property case marked a first in Cyprus.

And although they are thrilled with the outcome, there has been a heavy personal cost.

On hearing the judgement, neither Beaumont nor Sims could believe that justice had been served. “We couldn’t believe it. We both said it was wonderful but we were so surprised,” said Beaumont from Kinousa village in Paphos.

“In the back of our minds we thought we would lose. When we won it just overcame us. It was very emotional,” she added.

The legal victory came at a cost. Their search for the “dream home” and the stress it caused led to a split in 2002, after 20 years together. Despite the break-up, the two agreed to continue their search for justice.

According to Beaumont, the property dispute also took its toll on Sims’ health, who heard about the victory from a hospital in England, where he underwent a triple bypass.

“We wanted a place to retire, it was supposed to be our dream house. We loved the country and the people, we still do, but unfortunately we got caught in this trap,” she said.

The couple, both from Gloucestershire, sued their Paphos lawyer Nicos Papacleovoulou for negligently handling a property contract in 1999, which led to them losing a significant amount of money while never getting the property.

The lawyer had failed to inform the couple that the property had been twice mortgaged and had a charge registered against it. The developer who signed the contract subsequently went bankrupt and never finished the house.

Sims had been stationed in Cyprus in 1951 as part of his national military service. In 1999, he brought Beaumont here to retire and find their “dream home” in Kinousa. Eleven years on, the Supreme Court overturned the Paphos district court’s first instance ruling, finding the defendant lawyer negligent. The Court ordered the lawyer to pay full compensation to the couple for money lost as a result.

Beaumont told the Cyprus Mail that once the couple realised they were not going to get the house, disillusioned and near separation, they began the arduous task of getting back the money invested.

“We tried quite a few lawyers in Paphos. We got nowhere. They read the contract and said they couldn’t help us, that they had no advice to give. We were very exasperated,” she said.

Eventually, a Nicosia consultant recommended the father and son law firm, Antonis and Nicholas Georghiades, in the capital. The son, Nicholas, a junior lawyer who’d only recently completed his bar exam, agreed to take the case on in 2002.

“I investigated the possibility of going after the developer, which proved impossible due to his financial status so I decided after a lot of thought they should sue the lawyer, that was their only choice,” said Georghiades.

The young lawyer warned the couple that their chances were not high. “There was no previous case law. I had to rely on English authorities that might not necessarily be adopted. In England, the law society has special rules on conveyancing practice. There’s no such thing in Cyprus,” he added.

The case was filed in 2003 in a Paphos court, and lost in 2007. “When we lost, we were disappointed but not surprised. Being foreigners here, we thought we hadn’t been treated as fairly as we should have done. We were determined to see it through,” said Beaumont.

In April 2007, an appeal was filed, leading to last week’s key ruling in the Supreme Court. “To be honest, I didn’t expect the judgement. I was hoping but I tried not to persuade myself too much. It was quite outstanding as it set a very good precedent, fully explaining a lawyer’s duties. It was easily the best case scenario for us,” he said.

Georghiades acknowledged the judgement would send alarm bells among colleagues who have been following unsafe practices, though he did not expect many more such cases due to the small size of the legal community. He called on the Bar Association to consider special proceedings where it can order its members to pay compensation, rather than just launch disciplinary proceedings.

Asked if she had any advice for future property buyers, Beaumont said: “If you want to live here, come and rent for at least two years first. Do your research thoroughly.”

And for those who are already in muddy waters, would she recommend the lengthy legal route?

“If they feel they can cope with it, yes. This decision shows there is light at the end of the tunnel. If they don’t do anything then things are not going to get any better.

“It has to be a personal choice in the end. It’s not easy standing up in court giving evidence, as I did.”

The Supreme Court ruling in favour of the couple against the lawyer was not the only first.

It was also the first time that a lawyer had agreed to represent clients wishing to sue another lawyer. And perhaps most importantly, in their ruling, the top judges laid out the duties and obligations of a lawyer vis-a-vis their clients for the first time, providing a solid reference for any future case against negligent lawyers, particularly regarding Title Deeds.

A sad day for Cyprus property…

Editorial
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Free SpeechFREEDOM of speech is taken for granted in Cyprus, with parts of the media often tolerating abusive remarks by politicians and government officials, while some editors and journalists commonly cross the thin line of libel, each time using the excuse of “public interest.”

However, when it comes to real cases of public interest, some media bosses and journalists occasionally bow to commercial interests or simply accept only one side’s view as a fact.

Such was the reporting a few weeks ago of the case of a single property owner duped by a crooked developer who was fed up of his arguments falling on deaf ears and decided to take the matter into his own hands – he and his family protested at the entrance of a high-profile property show in the U.K., causing the handful of Cypriot exhibitors to be embarrassed and labelling Cyprus as being “A Shame in the Sun”.

Local media hastily labelled the protestors as ‘rowdy’ and causing serious harm to the island’s lucrative property sector, but few actually cared to find out the real reason for the whole fuss.

Hundreds of cases of property fraud are swept under the carpet by well-connected developers or their smart-suited lawyers, while civil servants in the know throw their arms up in the air in despair. No wonder the Interior Minister is clueless when it comes to what is really happening in the property sector. Perhaps he should be less generous with incentives in the future as developers have been less than honest with him.

However, a sadder case was the news that the Cyprus Property Action Group has been ordered to shut down its website, because of allegedly libellous attacks against a leading developer in Paphos.

Furthermore, the owner of the Internet page is also being sued, while he has received threats of being placed on a black list and of being thrown in jail if he does not show up in court.

Is this Cyprus we are talking about or a dictatorial central African state where relatives, friends and money rule the day?

Surely, a public relations nightmare could have been turned around to resolve any case, as long as either side stuck to the basic rules of fairness, truth and goodwill? Unless, of course, some of these ingredients were not there. In which case, property developers could now face an even worse nightmare of harsher criticism and ruthless attacks on online communities and blogs.

Perhaps some property developers should at last consider adopting the rule “if it’s broke, fix it!”

A sad day for Cyprus property

Cyprus protest saves new projects

Stephen Harris
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HUNDREDS of construction jobs in Cyprus have been secured after development company staff protested delays in the country’s planning office.

The government has approved several projects submitted by Alpha Panareti following the demonstration in Paphos last week.

“We were objecting to the length of time taken to issue licences to start work on projects that have been planned for many months and that have already received approval,” said Alpha Panareti’s managing director Andreas Ioannou in a statement.

Company management had warned it could not maintain current staff levels without starting the new developments. But the firm was quick strike down suggestions that job losses were already planned.

“Alpha Panareti is not making anyone redundant and it does not have business problems beyond those of any reasonably large company at this time of worldwide crisis,” said Ioannou.

The company was also protesting proposals to stop non-Greek speaking immigrants from working in Cyprus.

“We would like to recruit more staff for the construction side of the company, but none are available with the appropriate skills to work to our company standards,” said Ioannou.

The approved projects include three mini-marinas and a solar energy system. OPP understands the firm will also be involved in a recently agreed development by Qatar’s property investment fund, Qatari Diar.

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