August 2022

Judgment of the Heraklion Court of First Instance on the suspension of the execution of a payment order of 650.000 euros

Decision No. 576/2022 of the Heraklion Court of First Instance was issued, on the basis of which our client's application was accepted and the execution of a payment order of approximately 650,000 euros was suspended. One of the grounds for opposition was related to the lack of written proof of the assignment of the management of the specific business credit loan receivable to Servicer. We have pointed out this issue several times in our articles: while the transfer (assignment) of the individual receivables can be proven in writing, in most cases the assignment of the management to the Servicer is not proven in writing. Accordingly, if we accept that the Servicer has powers to perform procedural acts, he cannot prove to the judge issuing the payment order in writing that he has been entrusted with the management of the specific claim in question. The mere reference in the summary of the servicing agreement to the entrustment of the servicing of general business claims, etc. cannot be considered sufficient since it does not specify the disputed claim in unique terms, such as the date or number of the contract from which the claim arises and the amount of the claim. 

A crucial passage from that judgment is quoted below:

"....from a review of the document produced before the Judge issuing the impugned order of payment, No. ... on the publication at the Athens Pledge Registry (in volume ...) of a summary of the contract for the management of business receivables (Articles 10(14) and 16 of Law 3156/2003) between the beneficiary of the receivables, a foreign special purpose company with the name "... " and the claims administrator in respect of which the application is made, namely the document produced by the latter to prove that it is the administrator of the claim in respect of which the order under appeal was issued (that is to say, the claim for the balance due resulting from the final closure of the accounts opened and held in the name of the applicant's creditor and under the above-mentioned agreement No . ..., it does not appear that it (the claim) is in fact one of the claims which the defendant has taken over the management of. In particular, it is apparent from that document that a contract for the management of business claims was concluded between the abovementioned foreign special purpose company ("...") and the defendant, in accordance with Article 10(1)(b) and (c) of Regulation (EC) No 1073/1999. 14 and 16 of Law 3156/2003, and that the latter undertook all collection and general management services for securitised receivables from business and other loan agreements, without, however, making any specific reference to the above credit agreement and the receivable in question, contrary to, for example, the document also submitted under no. ... on the publication at the Athens Pledge Registry (in volume ...) of a summary of the contract of sale and transfer of business receivables from the company with the name "..." to the above-mentioned foreign special purpose company with the name "...", accompanied by an extract of the relevant annex with the receivables transferred to the latter, and in particular a copy of the page of the contract of sale and transfer of business receivables from the company with the name "..." to the above-mentioned foreign special purpose company with the name "...". 9907 of the annex, where there is a clear reference to the claim at issue. While it is proved from the documents produced that the claim in question was indeed transferred to the foreign special purpose vehicle in question, the same is not true of the fact that the defendant took over the management of that claim and, consequently, the procedural requirement for the issue of a payment order to prove the active legal capacity of the defendant is lacking [see related Athens Single-Member Court of First Instance 4485/2021, Tripoli Single-Member Court of First Instance 41/2021, Heraklion Single-Member Court of First Instance 474/2020, published in "NOMOS", Heraklion Single-Member Court of First Instance 400/2022, unpublished in the legal press]".

(for more see here)