Court blocks home auctions when other assets can cover public debts
Greece’s Council of State has ruled that authorities cannot proceed with the compulsory auction of a family’s primary residence to recover public debts if the debtor has other assets sufficient to cover the outstanding amount.
The ruling by the court’s Sixth Chamber applies to debts owed to the state, tax authorities, municipalities, social security funds and other public bodies under the Code for the Collection of Public Revenue (KEDE).
The court also clarified that debtors can challenge enforcement proceedings at any stage, from the initial notification of a property seizure to the final issuance of an auction notice.
Previously, it had been accepted that such challenges could be lodged only at the initial stage, following notification of the seizure report.
Court cites constitutional protection of the home
The case concerned a 162-square-metre maisonette in Moschato, near Piraeus, jointly owned by a company managing director and his wife, each holding a 50% share.
The property had been included in a compulsory auction notice over overdue state debts owed by an industrial company.
The managing director challenged the auction before the Athens Administrative Court of First Instance, which annulled the measure, finding that it violated the principles of good administration and proportionality.
The Athens Administrative Court of Appeal subsequently rejected the state’s appeal, noting that the property was the family’s sole primary residence and that the owner held other real estate in different parts of Greece.
The appellate court found that the state could pursue less burdensome measures to recover the debt without putting the family home up for auction.
The state argued that tax authorities had the discretion under KEDE to decide which assets should be seized to recover outstanding debts.
However, the Council of State dismissed the state’s application as unfounded.
Authorities must exhaust alternative measures
The court stressed that the home, as a fundamental element of human dignity, security and family life, enjoys special protection under the Greek Constitution.
It referred to Article 25(1), which requires state authorities to ensure the effective protection of fundamental human rights.
The ruling also emphasised the constitutional principle of proportionality, stating that any measure resulting in the loss of a person’s home must be demonstrably necessary under the specific circumstances.
Before proceeding with such a measure, authorities must establish that other suitable but less restrictive options have been exhausted, regardless of which public body issues the decision or at what stage of the enforcement process it occurs.
The decision reinforces the requirement that public debt recovery measures must balance the state’s financial interests with constitutional protections for individuals and their families.
Source:AMNA
