Cyprus Mail
Cyprus

Supreme court fracas focuses on its president

Myron Nicolatos, president of the supreme court (second left)

The House ethics committee said Wednesday it will be discussing the dispute that has broken out in the justice system after serious accusations concerning conflict of interest among supreme court judges, including its president Myron Nicolatos, who has been fending off calls for his resignation.

Akel MP Irini Charalambidou, who wrote to the Council of Europe’s anti-corruption organisation, Greco, asking for assistance, expressed hope they would be given permission to come immediately and not wait until their routine review which is not due for some weeks.

A statement from Greco’s Cypriot representative said the organisation has been informed of the situation “and is willing to provide assistance”.

It added that as part of Cyprus’ outstanding compliance report regarding its fourth evaluation round, which is related to the judiciary, a team of senior Greco officers will visit Cyprus to provide additional guidance, the statement said.

At the same time, parliament will also be discussing the matter next Wednesday in a bid to find ways to resolve the crisis, which has now concentrated on the supreme court president.

Critics of Nicolatos have focused on the fact that his daughter and sister appeared to have benefited from out-of-court settlements with Bank of Cyprus (BoC) relating to lawsuits they had filed concerning the conversion of their deposits into bonds.

Nicolatos had adjudicated in an appeal filed by former BoC CEO Andreas Eliades who had been jailed for market manipulation.

In a 2 to 1 decision, the three-bench court found that Bank of Cyprus and Eliades, although they had made false representations about the financial status of the bank, did not do so with intent to manipulate the market but rather to ‘reassure’ shareholders.

That decision was criticised by attorney-general Costas Clerides and the Securities and Exchange Commission.

Clerides put the boot in on Tuesday.

“It emerged after this judgement that, close relatives of the chair of the appeals court, who happens to be the president of the supreme court, and whose vote decided the outcome of the case in the bank’s favour, that is to say the judge’s daughter and sister, had benefited from an out-of-court settlement in a lawsuit they had filed against the bank, relating to claims they made concerning the conversion of their deposits into bonds.”

The bond issue is just one aspect of the astonishing claims first made by lawyer Nicos Clerides, brother of the attorney-general, which sparked the fracas.

Nicos Clerides claimed, and later provided details, that the courts are controlled by the Polyviou and Chrysafinis law firm.

“There is not a single supreme court judge who does not have a child at the law office that promotes the banks’ interests,” the attorney-general’s brother had said of the firm, which represents Bank of Cyprus.

On Tuesday, the attorney-general said that in supreme court’s final judgement in the market manipulation (insider information) case filed against BoC, “three of the five judges on the appeals court have children or a spouse who are employed at the law firm representing the Bank and its officer in the appeals process.”

Citing court transcripts, Clerides said that at the beginning of the appeals process, which got underway on January 11, 2018, none of the members of the supreme court volunteered this information regarding their connection to the defendants’ law firm.

This was despite the fact that two days prior, on January 9, the European Court of Human Rights, in the case of Nicholas v. Cyprus, had stated:

“Given the importance of appearances, however, when such a situation (which can give rise to a suggestion or appearance of bias) arises, that situation should be disclosed at the outset of the proceedings…This is an important procedural safeguard which is necessary in order to provide adequate guarantees in respect of both objective and subjective impartiality.”

The Nicholas case concerns a suit filed at the ECHR because former supreme court judge Andreas Kramvis sat in a trial in which a party was represented by the C&P law firm, which employs his son, who is also married to Polys Polyviou’s daughter and they both work at the firm.

Lawyer and former member of the Parliamentary Assembly of the Council of Europe, Christos Pourgourides said Greco had no executive authority and could only make recommendations.

Speaking on Politis Radio 107.6, Pourgourides blamed the problems on the lack of oversight but he said there was no impasse.

“No one is preventing the attorney-general from ordering a police investigation or asking for the appointment of an independent investigating committee,” he said.

The final say however, lies with the supreme council of judicature, which consists of the president and 12 supreme court judges.

The council has disciplinary powers over all judges, including that of dismissal. It also appoints all judges apart those of the supreme court who are appointed by the president.

The council can initiate a process against any judge, with or without a complaint.

The issue will be discussed in parliament by the House ethics committee. House president Demetris Syllouris said the aim was to put together various recommendations discussed in the past and use them to reform justice to prevent similar situations in the future.