The 1st International Arbitration Forum
Posted by Calavros Admin
Posted Feb 2018
Significant success of our Litigation Team. Landmark Rulings of the Greek Civil Courts on pending dispute cases against former leading Insurance and Banking Group.
Our firm has successfully represented various individual clients before the Greek Civil Courts (1st and 2nd Instance), having filed corresponding actions against a former leading Banking and Insurance Group of companies in order to claim the annulment of abusive insurance contracts. More specifically, the Banking Institution (Hereinafter “Bank”) of the opposing Group had established a peculiar method of loaning according to which it urged the Borrowers to conclude a separate insurance contract with the Insurance Institution (Hereinafter “Insurer”) of the Litigant Group, as a required step of loan approval by the Bank. According to the said, pre-drafted payment scheme, the Borrower undertook the obligation to pay the capital of the Loan to the Insurer (under the form of insurance premium) and the interest of the Loan to the Bank. The same scheme foresaw that, upon payment of all scheduled installments of the capital of the Loan to the Insurer, the Bank would consider the capital of the received loan fully paid, provided that the Insurer proceeded with payment of the capital of the loan to the Bank. In other words, in case that the Insurer failed to transfer the paid capital to the Bank for whatever cause, the Bank would not consider the Borrower fully discharged, even if the latter had indeed paid the capital to the Insurer, following Bank’s mandate. Such payment scheme proved to be a common practice of the said Group of companies throughout the years of its presence in Greece. In 2009 the Supervising Greek Authority ordered the compulsory liquidation of the Insurance Institution of the Group, which left thousands of people exposed towards the Bank Institution of the Group, which systematically refused to discharge thousands of loans despite the fact that the Borrowers had paid the scheduled installments to the Insurer. Our firm has represented numerous individuals who received loans under the afore-described payment scheme and has filed corresponding lawsuits against the crediting Bank before the Greek Courts. The Greek Courts have already ruled in favor of our Clients, in various cases, both at 1st and 2nd Instance (rejecting corresponding Appeals of the Bank), discharging our Clients and adopting our legal argumentation that such terms: i) are abusive and misleading, ii) are imposed in bad faith, iii) exploit the consumer’s ignorance on complex commercial and banking issues iv) refer to the internal contractual bond between the Bank and the Insurer and should not be enforced against the Borrower v) violate the principle of proportionality, which also rules the Greek Constitution.