A borrower appealing a Form IA auction notice need not serve the appeal on judgment creditors with memos or on guarantors, the Court of Appeal held on 5 October 2026.
Klitos Platis, advocate
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A borrower whose mortgaged land is about to be auctioned can appeal the lender’s auction notice to the District Court, and does not have to serve that appeal on every creditor who has registered a judgment against the property. The Court of Appeal decided this on 5 October 2026 in Fourtris v. Cyprus Asset Management Company Ltd, and set aside a Nicosia District Court decision that had thrown out a borrower’s appeal for exactly that reason.
The result matters to anyone on either side of a forced sale under Part VIA of the Immovable Property (Transfer and Mortgage) Law, Law 9/1965: borrowers, guarantors, and creditors who hold a memo on the debtor’s land.
What happened
KEDIPES, the Cyprus Asset Management Company, served a Form IA notice dated 1 February 2023 on Mr Fourtris under section 44C(2) of Law 9/1965. The notice told him that his mortgaged shares in two plots at Klirou would be auctioned on 8 June 2023 to recover a mortgage debt of 51,977.92 euro plus interest. He appealed to the District Court of Nicosia.
KEDIPES objected that the appeal had not been served on every “interested person”. The Land Registry search certificate showed three companies that had registered court judgments, memos, against the property. On 7 June 2023, the day before the auction date, the District Court agreed with KEDIPES and dismissed the appeal without looking at the borrower’s other grounds.
Interested persons receive the notices, not the appeal
The Court of Appeal agreed that memo holders and guarantors are interested persons. Section 44IE defines an interested person as anyone with a right to any part of the sale proceeds, as shown by a search of the Land Registry records, and expressly includes guarantors of the mortgage debt. Both groups want the property sold at the best price: the guarantors so that they are not later asked for the shortfall, and the memo holders so that something is left for them.
That is why the Law requires the lender to serve them with each of its notices: the Form I and Form IA notices, the independent valuation, the notice of a further auction, the Form IC notice and the notice of the proposed distribution of the proceeds, among others. And each of them has its own right to appeal the Form IA notice and the proposed distribution, under sections 44C(3) and 44I(3).
What the Law does not say is that one interested person’s appeal must be served on all the others. Where the legislature wanted a court application served on others, it said so, as in section 41(2) of the same Law. The Court compared execution by sale under Cap. 6, where section 24 and Rule 49.1(3) of the Civil Procedure Rules 2023 require service on the judgment debtor only. Making every memo holder and guarantor a necessary party to the borrower’s appeal would, in the Court’s words, be wholly dysfunctional where there are many of them.
A memo holder or guarantor who objects to the sale has an appeal of their own to file. They are not necessary parties to the borrower’s appeal.
Even a missing party is not an automatic dismissal
The Court added a second error. The District Court had treated non-service as fatal from the outset. That is not the rule. Under the old Order 9, rule 10, and now Rule 20.2(2) of the Civil Procedure Rules 2023, a court that finds a necessary party missing has discretion to add that party, even of its own motion, and dismissal is usually the last resort, where a trial has already been heard and nothing else can be done.
The appeal was allowed, with 4,100 euro costs, and the borrower’s appeal was sent to another District Court judge to decide the grounds that had never been examined. The Court noted that KEDIPES had a further auction set for the following day, 6 October 2026, under a later Form IC notice, and said it was right and expected that the lender would not proceed with it, so that the appeal could be heard.
What this means in practice
If you are a borrower and you receive a Form IA notice, you have 45 days from receipt to appeal to the District Court, and only on the grounds section 44C(3) lists. They include a notice that is defective in form or content, a notice not properly served, or one sent before the time for payment had run out. Missing the 45 days is far harder to repair than anything decided in this case. Serve the lender; you do not also need to serve every memo holder and guarantor on the search certificate.
If you are a guarantor or hold a memo on the debtor’s land, the lesson runs the other way. You will not be brought into the borrower’s appeal, so do not wait for it. If you have a ground under section 44C(3), your own appeal, filed within 45 days of receiving the notice, is the route.
The trap for borrowers is to read this judgment as a win on the merits. It is not. It sends the case back to be heard, three years after the original dismissal, and the lender’s right to sell is still to be decided on the remaining grounds. Nor does an appeal stop the auction by itself: here the Court of Appeal relied on the lender’s restraint, not on an order.
Our property team reviews Land Registry search certificates and auction notices, and our litigation practice acts in appeals against Part VIA sale notices.
Sources
- Dimos Fourtris v. Cyprus Asset Management Company Ltd, Civil Appeal 169/2023, Court of Appeal of Cyprus, 5 October 2026
- The Immovable Property (Transfer and Mortgage) Law of 1965, Law 9/1965, consolidated text, Part VIA, sections 44C, 44I and 44IE, CyLaw
- The Civil Procedure Law, Cap. 6, consolidated text, section 24, CyLaw
Need advice on your own matter?
Your first message costs nothing: within one working day we tell you whether we can help and what it would cost.
klitos@kleanthousplatis.com
Kleanthous & Platis LLC Registered law company Cyprus Bar Association HE 441973
Further reading
This article is for general information only and does not constitute legal advice. Laws and their application can change, and individual circumstances differ. For advice on your own matter, contact Klitos Platis at klitos@kleanthousplatis.com.
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