Enforcement Law: The Epidemic Has Passed, but Protection of Debtors from Eviction Remains in Force

Due to the COVID-19 epidemic, the Government submitted amendments to the Enforcement Law to the Parliament in November 2020, which were urgently accepted, adding Article 44, paragraph 3 to the Law. This article stipulates that enforcement for the eviction and handover of real estate will not be carried out from November 1 to April 1, unless there is a justified reason for it.

The Government emphasized that this provision was necessary because the epidemic reduced economic activity, which necessarily resulted in job losses and a decrease in the payment capacity of citizens to meet regular obligations, which is why legislative intervention is necessary to preserve the existential security of citizens and economic activity with balanced solutions. After analyzing the overall trends, although these analyses were not presented to the public or the legislator, the Government of the Republic of Croatia concluded that it would be appropriate to accept the proposed solution, which the Parliament did.

The Deadline for Completion is Missing

The protection of debtors due to the onset of the epidemic is, therefore, the exclusive reason for the adoption of the aforementioned provision. The interests of creditors are completely disregarded in this case. This is evidenced by the absence of a legal stipulation regarding the deadline until which the legislator will provide this form of protection to debtors.

On one hand, this is understandable because it could not be assumed how long the epidemic would last; however, on the other hand, the legislator could have at least indicated that this provision would cease to be valid upon the declaration of the end of the epidemic to avoid the need for further interventions in the Enforcement Law. Namely, on May 11, 2023, the Government declared the end of the COVID-19 epidemic throughout Croatia, and with this decision, the Decision on the Declaration of the Epidemic, made on March 11, 2020, ceased to be valid.

However, Article 46, paragraph 3 of the Enforcement Law continues to apply even though the exclusive reason for its adoption has ceased. If the main reason for the protection of debtors has ceased, then this provision should also cease to be valid. Furthermore, this article does not stipulate what would be considered a ‘justified reason’ for postponing the enforcement. Why have some of these ‘justified reasons’ not been regulated?

Postponements Until 2024

What about the interests of creditors? Were they not also affected by the onset of the COVID-19 epidemic? What if that real estate is needed by the creditor for housing because neither he nor his immediate family members have other property, or the creditor does not have the means to secure housing in another property while his is not handed over to him? Why is it always presumed that the debtor is the weaker party in the legal process, especially if it is a debtor who is aware that he is using someone else’s property and is exploiting all possible legal objections to delay the legal process?

It should be emphasized that enforcement proceedings cannot be initiated before obtaining a final court judgment ordering the defendant/debtor to hand over a specific property that he is unjustly using, and such proceedings can last more than five years despite the fact that the factual situation is already clear and unequivocally in favor of the plaintiff/creditor at the beginning of the legal process.

The court decides on the postponement of enforcement by a ruling against which no legal remedy is allowed. Thus, in a recent case, applying Article 46, paragraph 3 of the Enforcement Law, the new arrangement in the enforcement procedure initiated in June 2020 based on a final court decision was set for ‘the first half of April 2024,’ and this was done without any explanation.

To the Detriment of Creditors

The intention of the legislator to protect debtors from all judicial actions that could jeopardize the life, health, safety, or dignity of the debtor is supported. However, such an intention cannot be at the expense of those who legally protect their property that has been indisputably violated. The inviolability of property and the right to property are among the fundamental constitutional principles that cannot be limited by a court ruling against which no legal remedy is allowed.

The realization of debtor protection is also reflected in compensating the owners/creditors, so it would be fair for the state to compensate owners who, due to certain legal provisions aimed at protecting only some categories of debtors, cannot enjoy their property. The owner has the right to seek monetary compensation in court against anyone who unlawfully uses his property.

But as long as such legal proceedings last for years and involve the settlement of new court and other costs, and the collection of awarded amounts after the finality of the decision is uncertain, it is clear that such debtor protection results in harming the creditor. Let us ask ourselves whether any of us would consider it justified for someone to unlawfully use his property while he simultaneously bears the costs of using another property. The answer is, I believe, clear. And it is human.