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As a result of the resolution measures taken at Bank of Cyprus, the claimant depositors have found themselves in a better position than they would have been in had Bank of Cyprus gone into liquidation. No loss has been proven by the claimants who were given shares of a similar nominal value, whereas '... in order to establish loss, any reduced value would have to be put into evidence given the duty on the part of the claimants to mitigate the loss'.
The above is stated, inter alia, in a recent multi-page judgment of the Nicosia District Court, in which it dismissed a 2013 deposit impairment claim against the Bank of Cyprus, the Central Bank and the Republic of Cyprus.
In the above claim, inter alia, the plaintiffs alleged that "The Bank of Cyprus Public Company Ltd, Decree of 2013, Decree 103/2013" is unconstitutional. The Court noted in its decision that the Bank of Cyprus was placed in resolution under the provisions of the "Resolution of Credit and Other Institutions Law of 2013", the constitutionality of which was not challenged. The Court, in its judgment, states that it does not understand how it is possible for a Decree, which was issued on the basis of the provisions of a constitutional law, to be unconstitutional. Accordingly, there is no question of unconstitutionality.
The Court further stated that, in its judgment, there were indeed such reasons of public interest and financial stability without, on the facts before the Court, permitting a conclusion that there had been a violation of the constitutional principle of equality.
Furthermore, the Court adopted the reasoning of the judgment of the Plenary of the Supreme Court Myrto Christodoulou and Others - v. Republic, 553/13 et al. as to the fact that the depositor-bank relationship is a creditor-debtor relationship. That is, according to the Supreme Court, "by depositing, the depositor ceases to have ownership of the money in question and now has to his credit an equal debt owed to him by the Bank. Therefore, by the return of the above-mentioned shares, it becomes apparent that no impairment, diminution or deprivation of the plaintiffs' property has been shown."
The Court dismissed all of the Plaintiffs' claims and awarded costs in favour of the Defendants.
The case was handled on behalf of the Attorney General of the Republic by Ms. Zina Charalambous, Attorney of the Republic I.
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