AHI Legal Counsel’s Commentary on Wartime Restitution Published

During World War II, Germany forced Greece to "lend" money to it supposedly to help with its occupation of Greece otherwise known as an "occupation loan." Karambelas argues that the remedy for Greece's occupation loan to Germany is restitution and not reparation because the occupation loan was not a commercial loan, but rather an unlawful taking of property, the legal term of which is "conversion."

"Greece's legal rights with respect to the occupation loan depend on whether the loan is characterized as a commercial loan or as an unlawful taking of property under the guise of a commercial loan," Karambelas, who is a partner at Sfikas & Karambelas LLP, writes. "To be a commercial loan, it must have the attributes of a commercial loan. There must be a voluntary lender, a voluntary borrower, terms for repayment, and an interest rate."

Karambelas argues the occupation did not have a voluntary lender and did not carry an interest rate.

He writes, "Since the occupation loan is not a commercial loan it can only be an unlawful taking of property. The legal term for this taking is 'conversion.' In other words, once a property is unlawfully taken, it is considered to be converted. Conversion is a civil wrong not a criminal offense. The remedy for conversion is restitution not reparations. Restitution means that the taker returns the converted property to the rightful owner."

Karambelas concludes the Greek government's current efforts to resolve the matter via diplomatic channels is the most practical way for Greece to obtain restitution.