Notice of reference by an acquiring authority

An acquiring authority may apply to the court to determine amount of compensation

An acquiring authority, which may be the Republic, a municipal authority or a legal entity of public law or an institution of public utility, may compulsorily acquire a property for public benefit purposes.

In the case the compulsory acquisition of a property becomes necessary, the acquiring authority proceeds with the publication of the notice for the intended acquisition in the Official Gazette and serves a copy of the notice to every interested person. With the notice, the interested parties are called to submit any objection within 30 days . The acquiring authority from the publication conducts a preliminary investigation to assess the value of the property. After the expiration of the deadline provided in the notice, the acquiring authority examines any objections and if it deems the acquisition of the property necessary, it issues the order of acquisition, which however cannot be issued if 10 months pass since publication of the notice.

The acquiring authority is obliged within 14 months from the publication to enter into negotiations for the acquisition of the property through a private agreement and agree on compensation. In the event that no agreement is reached within 14 months, the acquiring authority is obliged to immediately offer the compensation it calculates. The owner may, with reservation of his right to apply to the court to determine the compensation, accept the compensation offered provided his acceptance will be accompanied by a written consent that the property acquired will be immediately registered in the name of the acquiring authority. In such a case, the owner applies to the court within 75 days from the date of receipt of the amount for the determination of the compensation and if they do not do so, it shall be deemed that an agreement has been reached with the acquiring authority.

If no agreement is reached by the time of the publication of the order for the compulsory acquisition, the acquiring authority or any interested person may file a notice of reference to the court seeking the determination of the compensation payable. Usually, the owner obtains a valuation from a private valuer, which he files to the court together with the notice of reference. However, if the owner of the property does not apply to the court, the acquiring authority may apply itself and serves the notice of reference to the owner. The amount of the compensation is calculated according to the rules mentioned in article 10 of the Compulsory Acquisition Law, L.15/62, and the value is equal to the amount it would be if the property was sold voluntarily on the free market at the time of the publication of the acquisition notice.

In a judgment issued on October 18 by the District Court of Limassol, it analysed the law and the procedure under the Compulsory Acquisition Regulations for the determination of the compensation regarding a plot acquired by the Republic for a primary school. The court in its judgment underlined that the notice of reference was filed in December 2014 and while it was served to the owner, she did not appear at the proceedings. The acquiring authority proceeded with the reference years later, in September 2021, by filing an application requesting the court determine the compensation for the property acquired in the absence of the owner. A relevant affidavit was filed by an officer of the land registry who adopted the valuation report prepared at the time of the notice. The court examined the valuation report and, taking into account the principles governing the calculation of the compensation, the comparative sales placed before the court by the valuer, the type and the characteristics of the comparable properties in connection with the type and characteristics of the property under acquisition, determined the amount of the fair and reasonable compensation payable to the owner, plus annual interest in accordance with the law.

The court, due to the fact that the reference was filed in December 2014 and despite it being served to the owner in July 2015 with no steps taken thereafter by the Republic, decided to order the Republic to serve the court’s judgment to the owner together with a copy of the application for judgment, so that the owner appear in the proceedings if she wishes, otherwise the court will proceed to finalise its judgment.

George Coucounis is a lawyer practicing in Larnaca and is the founder of George Coucounis LLC, Advocates & Legal Consultants, [email protected]