Dear Mr Christos Solomonides,
Violations of Consumer Protection Regulations
I am writing to you as the enforcement agency of unfair commercial practices. I would like you to repair the harm caused by my property developer and to take appropriate action against misleading industry advertising. The property industry in Cyprus falsely claims that a contract deposited at the land registry secures your rights and prevents your house being sold again without your consent.
As you may recall, I copied you on a letter dated 19th May 2011 to the Attorney General of the Republic regarding a double selling fraud under Section 303a of the criminal code. I have attached that letter along with their response dated 3rd June 2011 (Attachments 01 & 02). In my letter I requested final clarification and asked a few direct questions:-
“…as the law stands today, how many times can a property developer sell the same house before it becomes a criminal offence? And how much money can the developer keep from each buyer? In our case the same house was sold twice and the developer kept all our money paid (some 50% of the house price).”
The response is clear, that even with the deposit of a contract in the land registry, it is not a criminal offence for a developer to sell the same property over and over again and keep the money from each purchaser. Once again, according to the attorney general this is a civil issue and he gives no indication of plans to criminalise:-
“Having carefully examined the content of your letter we form the view that the raised issues concern matters falling within the sphere of civil law for which the Attorney General of the Republic, being the exclusive legal adviser of the government, cannot offer any advice. You may, if you wish to pursue such matters further before the civil courts of Cyprus, consult a practising lawyer of your choice.”
I consider any fair and reasonable jurisdiction would prohibit in all circumstances the double selling of the same property and would prosecute this act as a criminal fraud. However, the Republic seems adamant in protecting this developer and the courts have left it open for others to follow.
I am copying this letter to the Office of Fair Trading (OFT) in the UK and will be writing to them separately. I will be informing the OFT and our MEP’s of this breach of consumer protection and seeking the immediate cessation of selling Cypriot ‘off-plan’ property within the UK. There can be little doubt that this is the most dangerous of unfair practises facing buyers today.
The double selling of our house
On the 23rd August 2005 my wife and I bought a house from Christoforos Karayiannas and Son Ltd. It was an ‘off plan’ property with a delivery date of the 1st July 2006. Our contract was deposited in the land registry for specific performance. In February 2006 we disagreed with the developers because of changes they had made to the plans which were in breach of contract. At this stage, the property was midway through construction and we had paid CYP £66,000 in payments. Despite the changes to the plans which ruined the privacy of our garden, we felt we had little choice but to continue with the purchase and kept up all payments.
After increased animosity, the developers tried to bully us out of contract. They wished to sell our house at a higher price and remove us as critics from the development site. At this stage the developers wrote stating that they will “retain the money already paid” and “will never ever deliver to you [us] the house”. A civil case for breach of contract was started (Case No. 356/2006).
In February 2007 we discovered that our house had been resold to another British family. On the 20th March 2007 we wrote to the family but got no response. We followed this up with a letter from our lawyer on the 17th May 2007 (Attachment 03) and a reply came back on the 30th May 2007 (Attachment 04) stating that they had bought in good faith after they were told a previous contract had been cancelled. This was first brought to the attorney generals attention late 2007 requesting criminal proceedings under section 303a of the criminal code.
Criminal Code section 303A.
(1) Any person who, with intent to defraud, deals in immovable property belonging to another is guilty of a felony and is liable to imprisonment for seven years.
(2) For the purposes of the present section a person shall be deemed to be dealing in immovable property where (a) [that person] Sells to another, or rents to another, or mortgages to another or encumbers in any way, or makes available for use by another immovable property, or
(b) advertises or otherwise promotes the sale or renting out or mortgaging or charging in any way to another of immovable property or the use thereof by another, or
(c) concludes an agreement for the sale to another, or the renting out to another, or the mortgaging to another, or the charging in any way to the benefit of another, or the use by another of immovable property, or
(d) accepts the immovable property which is the object of the dealing as this is defined in the present subsection. On the 2nd September 2008 our lawyer wrote another letter chasing the attorney general for action (Attachment 05). In November 2008 we got the response that the file had been studied and that it had been ascertained that no criminal offence has been committed (Attachment 06). My family was left with little choice but to pay for a private criminal prosecution under the above law.
Private Criminal Prosecution
During the case we presented evidence that satisfied the essential prima facie elements to the judge. This included, our contract still lodged at the land registry, proof our house was resold and occupied and a High Court precedent stating that a contract in the land registry secures ones rights as beneficial owner. In common law jurisdictions, prima facie denotes evidence that – unless rebutted – would be sufficient to prove a particular proposition. The accused gave no evidence, choosing to remain silent, as is their right. At the conclusion of the case in January 2011, the judge even without hearing a rebuttal seemingly went against her own prima facie decision. The judge sided with the developer and the occupant and acquitted them of all charges. This shocking conclusion was covered in the Cyprus Mail (Attachment 07). I have attached my lawyer’s final submission and the judges ruling (Attachments 08 & 09).
Despite filed in 2006, our civil case is not due for hearing till the end of 2011. Our house is still occupied by the second buyer. The developer still retains our money which has prevented us from buying elsewhere and we live in rented accommodation in the UK. It is grossly unfair for us to be put on the very long and protracted journey towards remedy in the civil courts which is both costly and time-consuming while in contrast the developer enjoys our money to further his own business. The civil courts run a haphazard schedule with no priority given to cases of immovable property. It will be argued that this is in breach of article 30 of the constitution. The Republic cares little that my family lives in rented accommodation with our lives in limbo.
Unfair commercial practices
I consider that our property developer Christoforos Karayiannas and Son Ltd has infringed Directive 2005/29/EC and the Cyprus Law 103 (I) /2007 which transposes it. Dangerously, in light of the attorney generals response and the court ruling in our private criminal case violations of false advertising are now being committed throughout the property industry.
When buying property in Cyprus we like everyone else believed that the deposit of our contract in the land registry secured our rights, protected our interests and that we would become the equitable owner of the property purchased. This is the message from every estate agent, lawyer and developer in the property industry.
Here are some examples specific to our case:-
From Christoforos Karayiannas and Son Ltd’s promotional material:-
“From the minute your contract of sale is registered at the land registry department the property is officially yours and you can sell your property the next minute.”
From the brochure of the Pittadjis Law Firm of Paralimni. The lawyers who sold our house to another without our knowledge:-
“By having the purchase contract deposited at the L.R.O. The buyer not only secures his interest in the property but he also prevents the owner of land/vendor from transferring the property to a third party
without his knowledge.”
Dangerously, this rhetoric comes from the highest levels of government:-
In July 2009 while addressing the title deeds issue, Mr Neoclis Sylikiotis, Minister of the Interior stated:-
“It must also become clear that the ownership status of a buyer owner of immovable property in Cyprus is definitely secured and cannot be challenged, as long as the buyer-owner has submitted the buying-contract to the Department of Lands and Surveys.”
These claims are deceptive and materially inaccurate and such practises are banned under Consumer Protection Regulations (CPRs). Had we have known that our developer can sell our house to another and keep our money despite our contract in the land registry then we would never have bought in Cyprus. It is grossly unfair that this fraud is not a criminal offence and consumers must be made aware of this and that it may take up to ten years for satisfaction in the civil courts of Cyprus.
I have suffered two assaults by these developers (father and son). The first assault was in 2006 for talking to other customers on Phase 1 of my development. The second assault in 2008 was for simply going to take photos of my house. In this assault my hired car was rammed and after a sustained attacked I was hospitalised for six days and it was six months till I was fully recovered. I have attached details of their civil and criminal convictions in these matters (Attachment 10 & 11). However, the handling of theses cases and the leniency of the courts are subject to a High Court appeal and a matter for the ombudsman (the anti-discrimination body).
Christoforos Karayiannas and Son Ltd, claim and display that they are members AIPP (The Association of International Property Professionals) http://www.karayiannas.com.cy/. They are not members, they were expelled some time ago. http://www.aipp.org.uk/news/use-of-aipp-logo-by-nonmember-companies/
They also display the trust and quality marks of:-
The Federation of overseas Property Developers, Agents and Consultants.
The Cyprus Chamber of Commerce and Industry.
The Cyprus Land & Building Developers Association.
FIABCI (International Real Estate Federation)
A trader who has been approved, endorsed or authorised by a public or private body who then does not comply with their terms is in breach of CPRs. Displaying these endorsements built false confidence, unduly influenced us and is considered an unfair commercial practise in all circumstances.
Request for Action
I understand that as the Competition and Consumer Protection Service (CCP Service) you are the competent government service responsible for the enforcement of Consumer Protection Regulations (CPRs). Consequently, when the CCP Service becomes aware of any infringement of CPRs, it must, as soon as possible, take all the necessary enforcement measures to bring about the prohibition or cessation of the infringement committed by any supplier of goods. You have extensive powers to investigate violations of CPRs and powers of civil and criminal enforcement. This is to say that you could take court action on our behalf.
We wish to immediately obtain from our developer a full refund of our monies paid plus interest and damages. In light of the attorney generals response and the recent court ruling, I request that you safeguard consumer interests and address the inaccuracies promoted within the property industry and do everything in your power to prevent this happening again. Clearly, my family have been suffering for years as a result of buying property in Cyprus. My family’s plight will be broadcast on ITV’s “Homes from Hell” TV show in August. I have been protesting our situation for years in both Cyprus and abroad including outside property exhibitions in the UK. We took on the burden of a private criminal prosecution with no investigative powers and at great expense. I am very disappointed that I was unaware of your service and your far reaching powers and am grateful to the Cyprus Property Action Group (copied) who recently made this public in the Cypriot press. It is my expectation that you will conduct a thorough investigation of these allegations and take appropriate action. If the developer will not provide an immediate refund of our monies paid plus interest and damages then we need your full weight behind us to champion our civil case and fund the appeal of our private criminal prosecution. I’m sure you will agree that a swift hearing of our appeal at the Supreme Court is in the best interests of the entire property industry.
This unfair practice is happening to us now and Article 3 of the EU Directive 2005/29/EC states that your authority applies to practices ‘before, during and after a commercial transaction.’ As we have not taken possession of our house we are clearly still ‘during’ a commercial transaction. This means that the date on which we signed the contract in August 2005 is completely incidental and is not a reason for you to turn down our request for assistance (Contract Attachment 12).
To end, I would like to thank you for taking the time in reading this. I understand that under Article 29 of the Cyprus Constitution I should be due a response from you within 30 days and I eagerly await your response.
28th June 2011