September 2024 – Suspension of execution (auction of real estate property)

Suspension of execution (auction of real estate property) according to article 938 of the Greek Code of Civil Procedure – Violation of disposition power

Decision No. 192/2024 of the Single-Member Court of Appeal of Athens was recently issued, suspending enforcement proceedings that expedited a forced auction against our clients property.

With this decision, the success of the seventh ground of our appeal has been assumed, with which we reinstated the third additional ground of our opposition against the acts of forced execution against our principals (writ of payment – orders of execution – seizure report). Content of the relevant reason for appeal and opposition, was the violation of disposition power, as the expediter tried to impose a forced seizure on the basis of two enforceable titles, however the given order for execution related to only one of them. In addition, irreparable damage to our principals was assumed, given that the planned auction involved the residence of each of them and their families.

In December 2023, the opposing party proceeded to seize the real estate of our principals, which constituted the main and only residence of each of them. In spite of the fact that the enforced execution procedure that was initiated involved plenty of legal faults, the first-instance decision on our opposition, which was published at the beginning of July 2024, did not proceed with the annulment of the judicial enforcement acts. This resulted in the planned auction for the end of July 2024, to be carried out normally, if no attempt was made to stop it by taking additional legal measures to protect our principals.

In view of the planned auction, we filed an appeal against the first instance decision, piling up a request for suspension of the forced execution procedure, according to par. 2 of a. 938 of the Greek Code of Civil Procedure.

More specifically, the decision assumed that our relevant ground of appeal would be accepted, in which we exposed the fault of the first-instance decision, which rejected our additional ground of objection (without actually even examining it in substance) in which we analyzed that the expediter attempted the imposed seizure against the litigants properties based on two enforceable titles, but without having given the corresponding order for execution for both legal orders for payment, or even in the existing order for execution mentioning both enforceable titles on the basis of which the other party proceeded with the further enforcement action of the seizure, in violation of the power of disposition, as reflected in the provision of article 927 of the Greek Code of Civil Procedure.

The presented decision includes the following important considerations – judgments: “III. According to the first passage of the first paragraph of article 927 of the Greek Code of Civil Procedure, ‘enforcement is carried out by the person who has the right to execute it, who gives, on the record, the relevant order to a certain bailiff and defines the manner and whether possible and the objects on which the execution will take place’, while according to the last passage of the above paragraph ΄the order must be dated and signed by the beneficiary or his representative and gives the authority to perform all acts of execution, unless otherwise specified in it”. From the above fundamental rule of our procedural system, it follows that the enforcement process is not initiated ex officio, but only at the request of the urgent creditor. This request, which is carried out with the installment of the order, constitutes the lender’s exercise of the public law claim to provide legal protection in the form of forced execution. Forced execution that is not based on an order from the urgent lender is procedurally invalid and indeed regardless of damage (159 par. 2 of the Greek Code of Civil Procedure) since a fundamental rule of the system is violated. But also the pre-trial of the forced execution as an opening act of the whole process, again only after action of the urgent creditor can follow, since the service of the check for execution according to article 924 of the Greek Code of Civil Procedure can only be done after his order. This invalidity cannot be cured by subsequent approval because the execution bodies acted without authority and in violation of the above fundamental principle of the initiative of the parties, while the relevant reason for objection is referred to in the pre-trial and is subject to the deadline of article 934 paragraph I of the Greek Code of Civil Procedure (see P. Gesiou Faltsis, Compulsory Execution, General Part, par. 12 p. 85 ff and par. 40 p. 289, B. Vathrakokili Interpretation Code of Civil Procedure Article by Article Interpretive and Jurisprudential Analysis, Volume E under article 927 par. 19 p. 325, see also EfPir 181/2024, TNP LAW for the case where the order exists but suffers from defects)…The first-instance Court rejected the above ground of opposition, for the reason that the latter – order to be executed – does not constitute act of the executive procedure but is included in the preparatory stage thereof and therefore cannot be challenged independently with an objection to article 933 of the Greek Code of Civil Procedure. However, by accepting the above, the first-instance Court is likely to have erred in the interpretation and application of the law, in accordance with what was detailed in the main consideration immediately above, and therefore the relevant appeal is likely to succeed. From the documents presented by both sides, among which is the order for execution from 12.12.2023 submitted by the defendant expediting the execution, the following is probable:…However, from its content it follows that the order was given for the forced seizure of immovable property to the aforesaid Judicial Bailiff, as by virtue of and in execution of the first executor’s inventory and the Payment Order numbered ……………../2013 of the Judge of the Single-Member Court of First Instance of Piraeus, to register a seizure in the amount of Euro 50,000 which is part of the judgment’s fund capital pursuant to the above Payment Order. At no point in this is there any reference to the other enforceable title, namely the one under no. ………./2013 Payment Order of the Judge of the Single-Member Court of First Instance of Piraeus, nor, for greater reason, the confiscation of a specific amount that will correspond to all or part of the awarded claim and, in case of part thereof, to the fund to which it concerns. Based on the above, it is likely that this ground of appeal will succeed, given that the submitted documents do not show an order on the part of the defendant to register a seizure on the basis of the claim arising from the no. ……../2013 Payment Order of the Judge of the Single Member Court of First Instance of Piraeus, which however – seizure – refers to under no. ………../22.12.2023 report of forced confiscation of immovable property drawn up by the aforesaid Judicial Commissioner…”.

As for the equally crucial issue of the possibility of irreparable damage to our principals, the decision states the following: “In view of the possible irreparable damage that the applicants will suffer, since an auction of their properties, which constitute the place of residence of themselves and their families, has already been set, the application in question must be accepted and the expedited forced execution and the appointed based to the no.…………./22.12.2023 report of forced confiscation of immovable property …auction.”

As a consequence of all of the above, the requested suspension of the auction was granted until the decision on our appeal (the hearing of which was set for the end of 2025), which gives additional time to our principals, but also puts further pressure on the expenditer, in order to achieve a realistic and sustainable settlement agreement of their alleged debts (given that in reality the attempt to defend the debtor in enforcement actions against him, basically aims to the achievement of debt settlement, given that in most cases, earlier attempts to resolve disputes out of court with the achievement of a sustainable settlement of debts, come up against the intransigence of creditors).