My co-owner’s share is being sold by the bank. Do I get the right to buy it first?

Not under section 25 of Cap. 224. The Court of Appeal held on 20 October 2026 that the section applies when a co-owner declares at the Land Registry that he has agreed to sell his share, and not to a forced sale by a mortgagee under Law 9/1965.

A co-owner could not stop the bank selling her sister’s half

In short

A co-owner has no right of first refusal when a bank sells the other co-owner’s mortgaged share, the Court of Appeal held on 20 October 2026. She lived on the land.

Klitos Platis, advocate

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A co-owner cannot stop a bank from selling the other co-owner’s mortgaged share, and has no right to buy it first. On 20 October 2026 the Court of Appeal dismissed the appeal of a woman whose sister’s half share in a family plot in Geroskipou had been sold under the mortgage, even though she lived on the land and ran a gym there.

Many Cypriot families hold land in undivided shares, between siblings, parents and children, or business partners. When one of them borrows against his share and defaults, the others discover that the bank, or whoever buys from it, can become their new co-owner without asking them.

What happened

The plot in Geroskipou, Paphos, belonged half to the appellant and half to her sister. On it stood an older house where their elderly parents lived, and a jointly owned building with a gym on the lower floors and a flat on the third floor, where the appellant had lived with her family since 2012.

The sister’s half share was mortgaged. When her loans went unpaid, the Cyprus Asset Management Company (KEDIPES), as mortgagee, started a sale under Part VIA of Law 9/1965 and served the notices the Law requires on the sister and the other interested persons. The auction failed, and on 27 April 2018 KEDIPES bought the share itself for €432,600.

The appellant sued in the Paphos District Court and obtained an order without notice on 21 March 2019 freezing the share. On 29 November 2019 the court set that order aside and refused any further interim orders. She appealed.

What the co-owner argued

She said that she and her sister had agreed orally to divide the property, so that the gym building and the flat would be registered in her name, and that she had paid for finishing the flat and equipping the gym. She said the sale breached section 25 of Cap. 224, because a co-owner must be offered the share before it goes to an outsider. She also said she had never been told of the sale.

Why the appeal failed

The right of first refusal applies to voluntary sales only. Section 25(1) of Cap. 224 applies when a co-owner declares at the District Lands Office that he has agreed to sell his share to someone who is not a registered co-owner. The Court held that it therefore does not apply to a forced sale of a mortgaged share by the mortgagee.

A co-owner is not an interested person in the bank’s sale. Section 44IE of Law 9/1965 defines an interested person as anyone entitled to part of the sale proceeds, as shown by the Land Registry records, including guarantors. A co-owner of another share receives nothing from the price. Following Polyxenia Isaak Restaurant Ltd v. Hellenic Bank, Civil Appeal 2/2023, the Court held that she had no right to be served with the notices or to appeal the distribution of the proceeds.

A private agreement cannot defeat a registered mortgage. The oral agreement to divide the property and the money she spent were personal claims against her sister. The Court held that they could not override the mortgage registered over the sister’s share. Nor was there any promise by KEDIPES on which she had relied, so no estoppel arose.

When a co-owner’s share is mortgaged, the other co-owners stand outside the sale: no right to buy first, no notices, and no appeal of their own.

The Court also rejected her argument that a notice describing the share as 1/1 showed that KEDIPES meant to take the whole property. The sale concerned the sister’s half only, and the appellant’s own half remains hers. The appeal was dismissed with €5,100 plus VAT in costs.

What this means in practice

If you hold land in shares with someone else, search the Land Registry for mortgages and memos on the other shares, and repeat the search from time to time. A mortgage on your co-owner’s share is a mortgage you will not be asked about, and its sale will not be notified to you.

If you have agreed to divide the property, register the division. Until separate titles are issued, an agreement between co-owners binds only them. Here it gave no protection against the bank, however clear the arrangement on the ground and however much was spent on the building.

If you are about to build or invest on jointly owned land, settle the division first, or at least record the agreement in writing and take advice on securing it. Money spent on a building that stands on undivided land follows the land, not the person who paid.

If the share has already been sold, the sale does not end your rights. Your own share is untouched, and the District Court remarked that the division agreed with the former co-owner could be pursued against the new co-owner. Take advice early on that claim and on a division of the property, with the Land Registry search and every document of the agreement in hand.

Our property lawyers review Land Registry searches and act in the division of jointly owned land, and our litigation team acts in disputes over mortgagee sales. On who must be served when a borrower appeals the bank’s auction notice, see our note of 17 October 2026.

Questions we are asked

Will I be served with the bank’s auction notices?

Not as a co-owner. The Court held that a co-owner of another share is not an “interested person” under section 44IE of Law 9/1965, because she has no right to any part of the sale proceeds, so the notices and the appeal rights that go with them are not hers.

We agreed between us to divide the property, but never registered it. Does that protect me?

Not against a registered mortgage. The Court held that an unregistered division agreement and money spent on the building are personal claims against the other co-owner, and cannot defeat the mortgage registered over her share.

I live abroad and co-own family land in Cyprus. How do I find out whether the other shares are mortgaged?

Through a search of the Land Registry records, which shows the mortgages and memos registered against each share. We can obtain it for you and act on what it shows, under a power of attorney where one is needed, without you travelling to Cyprus.

What should my first message say?

The registration number and location of the property, the shares each co-owner holds, any mortgage or memo on the Land Registry search, any agreement between the co-owners on dividing the property, and any notice from a bank you have seen.

Sources

Klitos Platis

Advocate, Partner

Kleanthous & Platis LLC, Cyprus
Published 29 October 2026

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