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Tuesday 11th August 2020
Home News Swiss Franc loan time bomb defused

Swiss Franc loan time bomb defused

IN JULY 2012 Cyprus introduced a new limitation law “The Limitations Law (66(1) 2012)”, which imposed time limits on which a party must bring a claim or give notice of a claim to the other party.

In May this year MPs decided that the transition period should be extended by six months and a further announcement has been made extending the transition period by a further 12 months until 31st December 2014.

Limitation periods impose time limits on which a party must bring a claim or give notice of a claim to the other party. Once the limitation period has expired, a party is prohibited from starting a claim against another party.

The 2012 law provides for different limitation periods depending of the nature of the actionable right. For example:

Actionable Right
Limitation Period
Breach of contractSix years
Damages for nuisance, negligence or breach of Statutory DutiesSix years
Defamation or malicious falsehoodOne year
Tort ActionsThree years
Action for remuneration of self-employed persons (e.g. lawyers, doctors, architects, etc.)Three years
Bills of exchange, Bonds in customary forms, cheques, promissory notesSix years

Among those set to benefit from the latest one year extension to the law are those who bought property in Cyprus with loans denominated in a foreign currency (most notably Swiss Francs). As many of these loans were arranged in 2006, time was running out for them to decide whether to bring a claim against the bank for mis-selling. This latest (final?) one-year extension gives them further time to ponder.

(When MPs debated the earlier extension in May, they were unwilling to extend it beyond December 2013. Previous limitation laws had been continually extended and postponed by a succession of laws since the 1974 invasion and MPs considered that a further extension beyond the end of 2013 would make the new law pointless).

Editor’s note

To avoid possible confusion, the law does not seek to prevent claims being made in actions which had not been started before the law was passed.

Furthermore, the time period runs from the date the cause of action arose, which is not necessarily the date the contract was entered in many cases.


  1. @ Alan,

    I comment not only as a police officer but also as a lecturer on civil, criminal, business and employment law.

    In the UK Parliament makes the law, a similar situation exists in Cyprus where law is passed by its parliament (the Plenum).

    Whilst the Attorney General can advise, even take over a prosecution, he is not in a position to re-write the law. There is no requirement for a loss to prove a case of fraud or deception, or attempted deception.

    So go to the ECHR explain that the law exists to cover the facts but that the Cypriot Government will not enforce its own laws. There is also an offence of attempted fraud/deception.

    But first you must use the Ombudsman, both Cypriot and the EU. The ECHR being the last option when all else has failed.

    Explain that the solicitor has had the case proven before the Cyprus Bar.

    I understand the problem of pursuing a case, and I do not underestimate the courage and strength it takes. But unless something is done others will see this as a way of life. It is not an easy option, but with my house at risk I would want to know why a criminal offence is considered irrelevant in Cyprus. Get it in writing from the A.G. office, bearing in mind the new A.G. has talked about cleaning up the Island’s reputation. So try again.

    The internet is a source of information and can assist anyone thinking of undertaking their own prosecution, even a criminal prosecution, as you do not need the police if you undertake your own case.

    But Andyp still needs to get documents, preferably from the bank to back up his case.

  2. @ Peter Davis. I have done it all Peter as Alan Waring has largely confirmed.

    We, our new lawyers and the FCO were all led to believe that a criminal prosecution would follow because of the forgery admission by our original crooked lawyer. The Attorney General of the time thought otherwise and no further action was taken.

    As our developer had not defaulted on the loan and this had not been called in by a bank there was no loss to claim for.

    My point is that we must all be very careful about what we read whilst wearing our UK/ Foreigner hats. What we think is there or think should be there is generally not there when you start to read and think wearing a Cypriot hat.

    “Catch 22” comes to mind.

  3. @Peter Davis. A useful summary of the law. However, I suggest that there is a lot more to it than you reveal. First, while you refer to a lawyer’s negligence, there is also the issue of immovable property fraud which a lawyer may be party to. The UK Serious Fraud Office classifies all fraud as a type of criminal (note) activity defined as ‘the abuse of position, or false representation, or prejudicing someone’s rights for personal gain’. All fraud involves one or more acts of deception intended to achieve an unlawful gain.

    As you note, there is a clear distinction between civil and criminal law. However, in the UK the SFO has made it clear that in English law property fraud is first and foremost a criminal offence even though civil offences may also have been committed. The SFO also advises that although in general running a civil case first may sometimes be preferable, the seriousness of the case and the public interest may warrant a criminal case at the earliest opportunity.

    Cyprus often asserts that it follows English law and precedent but, it would appear, more in the breach than the observance especially in the approach to immovable property. The (former)Cyprus Attorney General imposed a very high hurdle list of 5 criteria, all of which must be met before a criminal case could be considered. One, as AndyP has said, is that the fraud complainant must have already suffered an actual and significant pecuniary loss from the alleged fraud. In immovable property cases whereas the fraudulent act(s) and loss may be clearly identifiable, they may not impact the victim until years later. This hurdle appears to have been set deliberately so as to deter victims from bringing cases, avoid police investigations and thwart justice by favouring the alleged wrongdoers and/or criminals. It is a feature of the sovereign corruption that afflicts this country.

    I happen to know that AndyP has already done much of what you suggest in his search for justice here in Cyprus. The Cyprus Bar Association and the Disciplinary Board of Advocates eventually did hear his case and he did win it. However, even though his lawyer had forged his and his wife’s signature and date on a forged contract of sale and refused to apologize to the plaintiffs and to the Disciplinary Board, she got off with a Euro 1,000 fine and an admonishment. Sic transit gloria iustitiae in Kypros.

  4. @andyp

    You are between civil and criminal law.

    A delay in registering the contract by a solicitor is negligence. Negligence is civil law (A Tort). The police deal with criminal and traffic matters only. Unless there is a conspiracy between the parties involved (lawyer & seller) in which case there is a criminal case. Problems is proving conspiracy as opposed to poor, sloppy work.

    There is a case against your solicitor for negligence which you will have to undertake yourself. So make a complaint, also a complaint of altering the document kept or required by the Land Registry for record purposes.

    A person can steal property (cars, cash donkeys) but not land, as it is still there, it does not vanish, so the points of theft regarding sales contracts are irrelevant. That is what the officer appears to be saying? I think?

    The Cyprus Law Society can help, make a complaint and prove your case then seek damages from your lawyer, but this you must do yourself, if you manage to find a lawyer that will help you sue another lawyer so much the better. They do exist but I think in Nicosia.

    Seek damages from the developer, after all how many times can he sell a piece of land without understanding that what he is doing is just not morally wrong but also illegal.

    The bank are also negligent, unless the developer lied to them in writing when they gave the loan when he said the property was free from any encumbrance. If the bank did not ask then they are also negligent. As a Credit Manager I can say that there is a saying that. “Banks only deal in documents”. These documents are always kept so you need to get copies. You then know who was negligent and if corruption was involved. Use Google to get the English version.

    If the latter is true and the developer lied to the bank then there is a case of obtaining money by deception. Can you manage to get bank records? Not an easy task but banks here are more relaxed than the UK, they even told me over the phone how much money my brother-in-law had in his account. Also go to the land registry department and see what documents they have on your property. I found they were willing to give me copies of all the correspondence with the planning office and told me to chase them up for my deeds. They were really helpful. failing that a lawyer may be able to get documents from the bank. The police can also apply for a warrant.

    Problem with the police is they have a limited understanding of the law, then the idle factor kicks in…who writes the law is a reference to the days of the colonial system on which Cyprus criminal (not the housing which is Otterman) is based. I know there were officers at my station with a reputation for being idle, so they would make excuses for not working. The idle, thick and stupid are found in all walks of life and all occupations.

    Damages are something you get in a civil remedy. It is not a punishment but given by a civil court to put the matter right, for example if you have suffered £100 loss you can be awarded £100 in compensation, and not for example £200 which would be a penalty. It is an order to put the parties back to where they were before the contract was made or breached. Compensation is something different under a criminal court, not to be confused with damages. The policeman doesn’t appear to know the difference.

    An act of forgery is a criminal matter, get copies of your contract from the Land Registry take them to the police and insist they get something done. You at least need a crime number, so don’t be fobbed off. Go higher if necessary the Chief of Police (his CV is on Google a useful tool when I want to complain about a company as it gives the CEO’s details), use the Ombudsman, and failing that the EU Ombudsman. (details of both are on Google, and make a complaint by email with follow up letters) Also seek help from CPAG they have been there so don’t reinvent the wheel. Don’t fret get even.

    You will need to show you did all this when they come “Knocking” and then you can say to the bank & developer your were dishonest and at the very least negligent. You can now give me compensation or walk away from my house.

    In any case you need to act sooner rather than later and don’t give up.

  5. I reported to the Police what I thought was a crime when I discovered my purchase contract had been delayed and subsequently forged by my lawyer.

    My developer’s mortgage was registered after signing the contract but before my contract was registered. The Police Officer said to me many years ago “Who do you think writes these laws?”

    The point being that you cannot pursue your lawyer for damages until you actually suffer loss.

    Do the maths. You only suffer loss when your bank comes knocking for “your” contribution towards the developer’s loan. The crime is committed long before but you will be time barred to claim when you actually suffer loss. Brilliant.

    Was the Police officer right?

    Who do you think rights these laws? Lawyers.

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