By Angelos Anastasiou
THE sequence of events leading up to the seizure of the Attorney-general’s car on Wednesday has raised questions as to the handling of the land expropriation case that resulted in the state owing the owner €9m for land it has no use for, Interior Minister Socratis Hasikos has said.
A 10,000-square-metre plot in Strovolos was expropriated by the education ministry in 2001 for the purpose of constructing a school, at the price of 600.000 Cyprus pounds (roughly €1m).
But plans to construct the school never went ahead, and the landowner went to court seeking an annulment as three years had elapsed since the expropriation without the government having developed the land as intended. In November 2008, the court ordered that the expropriation be reversed, at which point the owner returned the CYP600.000 and was given back the land.
According to Hasikos, although the expropriation was annulled in February 2010, the education ministry re-expropriated the land three months later, in May 2010, this time at a price of €5m, because it had been appraised at 2008 property values.
In light of the financial hardship that was by then starting to afflict Cyprus, the government found itself unable to pay the cost of expropriating the land and was starting to have second thoughts about the project. In September 2012 it decided to revoke its decision, because the education ministry had abandoned its plans to build the school.
“This is where the officials of the Education ministry who handled the issue owe some answers – namely, why they allowed the three-year period to lapse, only to re-expropriate the plot three months later at five times the original cost, especially when they were nowhere near ready to proceed with building the school,” Hasikos said.
Meanwhile, the landowner had already gone to court seeking to be reimbursed for the expropriated land, and secured a favourable court ruling mandating that the government had to pay the €5m, resulting in the seizure of government property – the Attorney-general’s car, to be auctioned off in order to repay part of the expropriation cost.
Hasikos said that a month ago court bailiffs had shown up to the interior ministry for the same purpose, but were sent away because “the court order they cited is an unfair one.” Hasikos said the government planned to ask the courts to suspend the enforcement of orders to seize government property.
“At the same time”, he added, “we will be asking the court to allow that the plot’s owners are paid rent for the period since the expropriation decision was taken, so that they can be reimbursed for the loss of use of their property during this time.”
Following the court’s decision, the deputy Attorney-general Rikkos Erotokritou appears to have negotiated an instalment-based settlement plan with the landowner for the government to pay the sum of €9m, being the expropriation amount of €5m plus interest.
In a letter to then Education Minister Kyriacos Kenevezos in November 2013, Erotokritou reportedly asked that the ministry revoked its September 2012 revocation of the expropriation decision, so that the initial expropriation stood and could be settled.
But Hasikos questioned the wisdom of this course of action, claiming that the non-settlement scenario would only cost the government €7m. That is because the law-mandated 9 per cent interest rate imposed on late government payments would add around €2m to the principal amount.
“It is crystal-clear that someone has to be accountable. We can’t have one million becoming five million within three months, nor can we have out-of-court settlements at €9m when the principal plus interest only add up to €7m,” he said.