Plenary decision of the Supreme Court on bad loans and auctions

Ioanna Mandrou

With an overwhelming majority, the Plenary of the Supreme Court, in a closed-door conference, resolved the issue that had arisen with the managers of the red loans, judging that the current legislation allows them to take procedural actions, in other words, to participate in auctions.

In particular, according to information, during the conference of the Plenary, the legal point of view was favored, that loan and credit management companies can act as parties under their own name representing the funds that have invested large sums of money by buying bad loans from the credit institutions.

The decision was taken by an overwhelming majority of 59 votes to 9, and the decision is expected to be written down soon, in order to make its full reasoning known and to produce substantial legal consequences, i.e. to be implemented.

After the publication of the decision, it is estimated that due to its irrevocable nature, a solution will be given to the issue of thousands of objections that have already been filed by borrower lawyers, who had questioned the ability of the so-called servicers to represent the Funds in court and to be able to carry out procedural acts, including those related to real estate auctions.

The case had arrived for adjudication on January 26 before the Plenary of the Supreme Court, in which about 70 senior judicial officials participated, while the prosecutor’s office was represented by the deputy prosecutor of the Supreme Court Panagiotis Panagiotopoulos.

During the hearing of the case, the Plenary Assembly of the country’s Bar Associations, Chambers and other bodies opposed the possibility of the so-called servicers being able to act as parties to the investors, with the main argument that the relevant legislation of 2003 does not leave such leeway.

For their part, however, legal representatives of credit institutions (Eurobank) and other companies argued that a later law of 2015 allows administrators to perform procedural actions, including auctions.

The Plenary of the Supreme Court decided in favor of this opinion, accepting the relevant recommendation of the supreme judicial official Kanelas Tzavela, who argued that fund managers based in Greece can act in judicial acts (become litigants), and conduct auctions with their own brand and not as proxies of the funds.

After the publication of the decision of the Plenary of the Supreme Court, it is expected that auction procedures will be activated, which until now have been frozen pending the decision.

Read the News today and get the latest news.
Follow Skai.gr on Google News and be the first to know all the news.