The decision No 339/2023 of the Patras Court of First Instance, which accepted the appeal and annulled a payment order issued for an amount of approximately 730,000 euros, was published.
The judgment accepted that the termination of the credit agreement with an open (mutual) account was invalid and that, consequently, the payment order had been issued for a claim which had not yet fallen due, with the result that it was annulled. And the invalidity of the termination was due to the fact that it was not carried out by a person representing the Bank, i.e. its Board of Directors, but by a lawyer, who, while issuing the payment order, did not produce a relevant power of attorney from the Bank granting the relevant authority.
As a rule, terminations of loan and credit agreements by credit institutions and management companies are signed by persons who do not have the power of representation of these companies, usually employees or lawyers. In such cases, the power of attorney granted must exist and be evidenced in writing, while subsequent approval is not sufficient as it is not retroactive.
As the judgment accepted: 'The above extrajudicial declaration - complaint of 14.12.2020, however, did not appear to have been signed by the legally competent representative bodies of the defendant, but was signed by the lawyer [...]. In any event, it does not appear from the review of the documents that the defendant produced the power of attorney showing that the attorney of [...] was authorised to terminate or approve the termination of the loan agreement in question. Therefore, the above termination of the loan agreement was invalid and no effect was produced by it'.