March 2022
Termination for Cause of Intermediary Agreements: the examples of Commercial Agency, Exclusive Distribution and Franchise Agreements
Daphne Sfyri, LL.M
Legal insight
June 2025
Danae Stamarga, LL.M.
Summary: This article presents case law examples where Greek courts have ruled that enforcement proceedings should be suspended due to the debtor's submission of an application to the out-of-court debt settlement mechanism. It also examines the reasoning behind these judicial decisions.
In a previous article (see here) we discussed the provisions of Law 4738/2020, which stipulate the suspension of enforcement measures upon submission of an application to the out-of-court mechanism, the conditions for such suspension, and issues arising when the process is not completed within two months—a common occurrence in practice.
This article presents recent court decisions addressing this issue, including cases where enforcement was suspended even after the two-month period had lapsed without completion of the process, and instances where courts deemed the initiation of enforcement proceedings as abusive against debtors who had applied to the out-of-court mechanism, leading to suspension or annulment of enforcement actions.
Decision No. 4203/2023, Athens Court of First Instance: The applicants filed an objection with a request to suspend enforcement against a payment order dated 11.10.2022, having submitted definitive applications to the out-of-court mechanism on 28.10.2022. The processing of these applications was still pending at the time of the suspension hearing. The court ruled that, although two months had passed since submission without a restructuring agreement being signed, the process was not completed due to delays not attributable to the applicants but to the electronic platform's inability to handle the volume of applications. Consequently, the court suspended the enforcement proceedings.
Decision No. 64/2024, Kalamata Court of First Instance: Similarly, the court suspended the enforcement process for the same reasons.
Decision No. 1446/2023, Thessaloniki Court of First Instance: The applicant sought a temporary injunction to suspend the auction of their sole primary residence scheduled for 02.09.2022, having submitted an application to the out-of-court mechanism on 13.12.2021. The court suspended the auction, noting that, despite more than eight months having passed since the application, it remained unprocessed due to incomplete data retrieval from third-party sources, not due to the applicant's fault.
Decision No. 403/2024, Patras Court of Appeal: The appellants-debtors argued that their definitive application to the out-of-court mechanism submitted on 10.08.2024 was still pending, thus suspending enforcement under Article 18 of Law 4738/2020. The court found that the application was still active and had neither resulted in a restructuring agreement nor been rejected, and therefore, the enforcement proceedings were suspended.
Decision No. 4607/2022, Athens Court of Appeal: The applicant filed for suspension of enforcement under Article 938 of the Civil Procedure Code, appealing a decision that dismissed their objection to the seizure of mortgaged property. The auction was scheduled for 14.09.2022, and the appeal was set for 12.01.2023. The applicant had submitted an application to the out-of-court mechanism on 23.12.2021 and was in negotiations with the creditor, who nonetheless proceeded with enforcement actions. The court found that the delay was not due to the applicant but to the platform's inability to process the volume of applications and suspended the enforcement proceedings.
Decision No. 367/2024, Patras Court of First Instance: The court deemed the creditor's conduct abusive due to systematic obstruction of the out-of-court process, including repeated requests for corrections and proceeding with enforcement despite ongoing negotiations. The court suspended the enforcement of the payment order.
Decision No. 262/2024, Eastern Crete Court of Appeal: The court suspended enforcement proceedings deemed abusive, even though the out-of-court process had been completed and the debtor failed to adhere to the restructuring agreement due to high monthly installments. The debtor continued negotiations for a viable solution, and the court found the creditor's actions to auction the debtor's sole primary residence abusive, given the debtor's consistent efforts and good faith.
Decision No. 762/2024, Athens Court of First Instance: The court annulled a seizure imposed on 06.09.2023, with an auction date in 2024, because the debtor had submitted a definitive application to the out-of-court mechanism on 13.03.2023. The court found the creditor's actions abusive and in violation of Article 18 of Law 4821/2021, as they proceeded with enforcement without awaiting the completion of the out-of-court process.
Decision No. 2744/2024, Athens Court of First Instance: The court annulled a continuation declaration of an auction due to abusive initiation. The debtor had submitted a definitive application to the out-of-court mechanism in July 2023, and while restructuring agreements were reached with other creditors, the specific creditor neither proposed a settlement nor refrained from proceeding with the auction of the debtor's significant asset.
Decision No. 211/2025, Lamia Court of First Instance: The court annulled a seizure report imposed abusively and in violation of Article 18 of Law 4738/2020, just 20 days after the debtor's definitive application to the out-of-court mechanism, without awaiting the process's completion to assess the claim's satisfaction possibility.
Decision No. 741/2025, Athens Court of First Instance: The court annulled both the seizure report and the payment order imposed on 27.09.2023, as the debtor had submitted a definitive application to the out-of-court mechanism on 30.01.2024, which was still active and had not been rejected or resulted in a restructuring proposal.
Contrary Decision No. 191/2024, Eastern Crete Court of Appeal: The court held that the suspension under Article 18 of Law 4738/2020 is automatic, but if violated, the debtor must file an objection before enforcement begins. The court emphasized that the submission of an application, even if definitive, does not render any creditor action abusive unless the suspension had commenced before enforcement proceedings began.
There are numerous instances where courts have ruled that enforcement proceedings should be suspended due to the debtor's definitive application to the out-of-court debt settlement mechanism, even when the two-month period stipulated by law has passed without completion of the process. Such suspension is granted particularly when enforcement is deemed abusive. Courts have also annulled certain enforcement actions when creditors' conduct was found to be abusive. Notably, a creditor's initiation of enforcement measures, despite the suspension of individual enforcement actions, may constitute grounds for objection and, under certain conditions, establish tort liability under Articles 914 et seq. of the Civil Code.
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