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In a recent decision, the Athens Court of First Instance upheld an application challenging acts of enforcement proceedings and annulled a forced auction report, finding that the adjudication of the property had been based on a manifest error during the submission of the financial bid by the highest bidder.

The decision was issued following an application filed by Papatriantafyllou & Thanasenari in the context of representing the bidder in the relevant judicial proceedings.

The ruling followed earlier court proceedings in which a suspension of the obligation to pay the auction price had been granted. The case highlights the importance of timely legal action in situations where the outcome of an auction procedure does not reflect the genuine intention of the participants.

Factual Background

The bidder participated in an electronic auction with the intention of acquiring a property. During the bidding process, a bid of €1,600,010 was mistakenly entered on the electronic platform instead of the intended amount of €160,010.

As a result, the property was awarded at a price significantly exceeding its market value.

Despite immediate objections and requests for correction submitted after the error was identified, the mistake was not rectified. Consequently, the bidder faced the risk of losing the guarantee deposit corresponding to 30% of the starting bid, as well as the possibility of being subject to enforcement measures for the excessively high adjudication price.

In order to protect the bidder’s rights, an application challenging the enforcement acts was filed, arguing that the adjudication had been based on a manifest error that did not reflect the bidder’s true intention.

The case was addressed through a combined procedural approach, involving an application for suspension and subsequently an application challenging the enforcement acts, in order to prevent the disproportionate financial consequences resulting from the erroneous adjudication of the property.

The Court’s Reasoning

The Court accepted the arguments raised and held that there had been a manifest and proven error in the submission of the bid, caused by an incorrect entry during the use of the electronic auction platform.

According to the Court, the submission of a bid amount that does not correspond to the bidder’s actual intention contravenes the principles of good faith and fair dealing, particularly in light of the evident disproportion between the submitted bid and the actual value of the property.

The Court emphasized that auction procedures must reflect the genuine economic intention of the participants and must be conducted in a manner that safeguards the substantive legality of the process.

On that basis, the Court upheld the application and annulled the forced auction report, concluding that the adjudication had been based on an error that materially distorted the outcome of the procedure.

Significance of the Decision

The decision is of particular interest for the practice of electronic auctions, as it demonstrates that even in fully automated procedures courts may examine the substantive legality of the process where circumstances arise that distort the genuine intention of the participants.

At the same time, the ruling confirms that applications challenging enforcement acts constitute a critical legal remedy for the protection of the rights of parties involved in enforcement proceedings.

The case also illustrates the importance of timely and targeted legal action, both at the stage of seeking suspension and at the stage of challenging enforcement acts.

Related topics:

• Suspension of Auction Payment and Guarantee Forfeiture
• Cancellation of Residential Property Auction
• Objection Against a Payment Order: The Debtor’s Legal Defence
• Auction Annulment in Greece – Legal Standing of a Fund

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Our firm successfully advised on the resolution of a high-value commercial dispute involving total claims of €3.1 million in the food trading sector.

The matter arose from a long-standing commercial relationship between our client — an industrial food distribution company — and a company operating in the same market. The parties had entered into successive product sale agreements over several years. Substantial outstanding and due receivables emerged from this relationship, ultimately evolving into a complex commercial dispute with significant financial and strategic implications.

The dispute initially proceeded through litigation. The Multi-Member Court of First Instance issued a judgment recognizing €2.6 million as due and payable to our client. The remaining €500,000 concerned subsequent commercial transactions carried out under a later agreement.

Given the size of the claim and the duration of the dispute, a timely and commercially viable resolution became critical. Both companies sought not only final settlement, but also the continuation of their commercial relationship on a stable and sustainable basis.

From Litigation to Structured Settlement and Immediate Recovery of €2.6 Million

Although enforcement proceedings were legally available, continued compulsory execution would likely have resulted in protracted, costly, and commercially uncertain proceedings, particularly as to the actual amount recoverable. There was also a tangible risk that sustained financial pressure could undermine the debtor company’s viability, thereby jeopardizing full recovery.

Our client — as a principal supplier of the debtor — had a strategic interest not only in maximizing recovery, but also in preserving the underlying commercial relationship within a viable framework. The solution therefore had to balance legal security with long-term business continuity.

With our strategic involvement, a financing structure was arranged through a bond loan facility granted by a banking institution. A portion of the loan proceeds was disbursed directly to our client.

To enable this financing, existing mortgages granted in favor of our client were released, allowing the registration of a first-ranking mortgage in favor of the financing bank.

This structure achieved a commercially balanced outcome:

• Our client secured immediate recovery of the substantial majority of the outstanding amounts.
• The debtor avoided disruptive enforcement measures.
• New financing was secured.
• Business continuity was preserved.
• The commercial relationship continued under a restructured and legally safeguarded framework.

Key Terms of the Settlement

The agreement included the following critical elements:

• Express and unconditional acknowledgment of the entire debt as liquidated, valid, and due.
• Full waiver by the debtor of any defenses, counterclaims, or appellate remedies against the relevant court judgment.
• Reduction of the claim from €3.1 million to €2.6 million, strictly conditional upon full and timely payment.
• Lump-sum repayment through the bond loan facility structured with our involvement, with direct disbursement to our client.
• Automatic reinstatement clause: in the event of non-payment, the full original claim becomes immediately due and payable, with unrestricted enforcement rights.

The agreement was carefully structured so that the partial debt waiver operated solely as an incentive for immediate performance, rather than as an unconditional loss of claim.

Commercial risk was effectively managed, and our client’s legal position remained comprehensively protected.

Business Impact

The settlement resulted in:

• Immediate and substantial liquidity recovery for our client.
• Definitive resolution of a long-standing commercial dispute.
• Restoration of business stability between the contracting parties.
• Preservation of full legal safeguards in the event of breach.

In large-scale commercial disputes, success is not measured solely by obtaining a favorable judgment. True effectiveness lies in converting legal leverage into immediate, measurable, and economically sustainable outcomes. This requires a combination of assertive litigation strategy and targeted negotiation designed to secure tangible results.

This matter reflects the approach of Papatriantafyllou & Thanasenari in high-value business disputes:
robust representation, commercially sound structuring, and a clear focus on delivering immediate and measurable results.

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In a recent ruling, the Single-Member Court of First Instance of Athens fully upheld the claims of our client, a claimant company, in a commercial debt recovery dispute. The Court confirmed both the existence and the amount of the outstanding monetary claim arising from a series of commercial transactions, while rejecting in their entirety the substantive arguments raised by the opposing party.

The decision constitutes a clear example of effective judicial protection in commercial and corporate disputes, particularly where the case is approached with a well-documented litigation strategy and proper use of evidentiary material.

Factual and Legal Background of the Dispute

The case concerned a commercial relationship under which successive sales agreements had been concluded and multiple invoices had been issued for the delivery of goods. Despite having received the products and accepted the relevant documentation, the counterparty failed to proceed with the timely and full payment of the amounts due.

During the proceedings, the defendant alleged partial payment, disputed the amount of the debt, and argued abusive exercise of rights by the claimant. After a detailed review of the invoices, supporting evidence, and the overall conduct of the parties, the Court dismissed these arguments as unfounded.

The Court’s Ruling

In its decision, the Court accepted the legal and factual arguments advanced on behalf of our client, finding that both the existence and the exact amount of the claim had been fully proven. It further held that the payments invoked by the defendant were insufficient to discharge the total debt.

Particular emphasis was placed on the correct application of the rules governing the allocation of payments, as well as on the assessment of the parties’ overall commercial relationship.

The Court recognized that the outstanding debt exceeded EUR 350,000, awarded statutory interest accruing from a specific point in time following the issuance of the relevant invoices until full payment, and ordered the defendant to bear the legal costs of the proceedings.

Practical Significance for Businesses

This decision is of particular practical importance for companies engaged in commercial transactions, as it confirms that:

• proper record-keeping and documentation of commercial transactions constitute critical evidentiary tools,
• general allegations of partial payment or abusive conduct are insufficient without clear and persuasive proof, and
• judicial enforcement can lead to tangible results when preceded by sound legal assessment and strategic preparation.

Strategic Litigation in Commercial Disputes

At Papatriantafyllou & Thanasenari, we understand that commercial and corporate disputes require a combination of legal precision and strategic thinking. Early legal guidance, thorough preparation of evidentiary material, and the selection of the appropriate procedural route can make the difference between a lengthy and uncertain process and a decisive judicial outcome.

This case confirms that a systematic and methodical approach to business disputes can effectively safeguard the financial interests of companies.

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Ioannis Papatriantafyllou | Published in NOMIKI BIBLIOTHIKI Daily

The transfer and sale of shares (share deal) is the most common form of corporate acquisition and one of the most frequently used — yet legally complex — transaction structures in the field of mergers and acquisitions (M&A). Unlike an asset deal, where the buyer acquires specific assets, a share deal entails the acquisition of the entire corporate entity, together with all rights, obligations, and inherent risks.

Although, from a technical perspective, a share deal constitutes a transfer of shares or partnership interests, in practice — where all shares are transferred — it is equivalent to the sale of the business itself. For this reason, Greek law and legal theory accept that, by analogy, the rules governing the sale of goods apply, particularly with respect to defects affecting the business as an economic unit. Against this background, the seller’s liability emerges as a central issue.

By acquiring the shares, the buyer automatically steps into the company’s full legal and economic position. This makes the seller’s representations and warranties, as well as the scope and quality of the due diligence process preceding the transaction, critically important.

Within this context, particular attention should be paid to the recent article by our partner, Yiannis Papatriantafyllou, published in NB Daily by Nomiki Vivliothiki, entitled:
“Acquisition of a Business (Share Deal): Seller’s Liability and Buyer’s Knowledge as a Limiting Factor.”

Seller, buyer, and the delicate balance of liability

In a share deal, the seller’s liability is primarily grounded in inaccurate or incomplete representations and warranties. These typically relate to, inter alia, the company’s financial position, the legality of corporate acts, the existence of pending disputes, and compliance with the applicable regulatory framework.

Liability may also arise from the failure to disclose material information, as the seller is subject to a duty of candour and full disclosure vis-à-vis the buyer.

Overall, the seller’s liability is directly linked to:

• the contractual representations and warranties provided,
• the content and quality of the information disclosed, and
• the level of knowledge attributed to the buyer at the time the transaction is concluded.

As highlighted in the article, the buyer’s actual or imputed knowledge may exclude or significantly limit claims against the seller, even where material issues affecting the value of the business arise after completion.

Risk allocation and modern contractual mechanisms

The buyer’s knowledge directly affects the causal link between breach and loss. Where the buyer was already aware of a defect, the ability to claim damages is substantially restricted, unless otherwise expressly agreed, for example through sandbagging clauses.

Warranties, indemnities, and disclosure letters constitute key contractual tools for allocating risk. The disclosure letter, in particular, plays a pivotal role, as it elevates the buyer’s knowledge to a clearly defined contractual element. Its effectiveness, however, depends on the precision and completeness of the disclosures, since vague or generic statements may prove insufficient.

Conclusion

Buyer’s knowledge is a fundamental factor shaping the allocation of liability in share deal transactions. The balance between the seller’s duty of transparency and the buyer’s obligation to conduct proper due diligence ultimately determines who will bear the risk of issues materialising after closing.

The article by Yiannis Papatriantafyllou makes a meaningful contribution to the legal discourse on business acquisitions and reflects our firm’s broader strategic approach to high-complexity M&A transactions and corporate disputes. It serves as a practical guide for legal professionals, entrepreneurs, and investors seeking legal certainty in high-value transactions.

You can read full article (in Greek) in NB Daily HERE.

Disclaimer: This publication is intended for informational purposes only and does not constitute legal advice. Professional legal guidance should always be sought before acting on any information contained herein.

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