The function of the Administrative Court of the Republic of Cyprus is to review the legality of administrative decisions. In other words, this means that the Administrative Court does not replace the Administration nor does it decide what the correct decision in a given case should be. On the contrary, decisions on matters such as zoning designation, for example, fall exclusively within the competence of the relevant administrative authority, which possesses discretion and specialised expertise.

The role of the Administrative Court focuses on examining whether the administrative decision was taken in accordance with the principles of administrative law and within the limits of legality. Among other things, it assesses whether the Administration carried out an appropriate and thorough investigation of the factual circumstances, whether it took into account all relevant information presented before it, whether its decision is sufficiently reasoned, and finally, whether the decision was made without any error regarding the facts.

In respect of the decision in the case of PHOTOS KARSERAS MANHATTAN PROPERTIES AND DEVELOPERS AND INVESTMENTS LTD & Others. v. DIRECTOR OF THE DEPARTMENT OF TOWN PLANNING AND HOUSING & Others, Joined Cases Nos. 473/2017, 600/2017 and 601/2017, dated 11 May 2026, the above case concerns three conjoined administrative recourses challenging the Administration’s decision to reject objections submitted by landowners in the context of the revision of the planning zones of the community of Kouklia in the Paphos district. The Applicants, namely the landowners, challenge the legality and correctness of the finalization of the zoning designation, arguing that their properties were not properly assessed and were left in non-development zones despite their particular and unique characteristics, location, and the development prospects of the area. More specifically, they remained outside residential zones instead of being included in residential, commercial, or tourist zones.

The applicants argued that their properties were surrounded by residential zones, had access to infrastructure and a public road, and in no way formed part of the archaeological site of Kouklia. It is noted that in some cases there were also prior administrative acts, such as earlier governmental decisions, which had created legitimate and reasonable expectations that the property would not remain under the same planning regime. An extract from the relevant decision is set out below:

“The Commission responsible for review of oppositions (known as «ΕΜΕ») acting by majority (the District Officer of Paphos and the President of the Union of Communities of Paphos) recommended the acceptance of the objection and the inclusion of part of the disputed property in a Commercial Zone:

“so that the planning regulation aligns with the title deed of the property in which the property is described as “Field – Site for Commercial Centre”, a designation resulting from a previous decision of the Council of Ministers.’ …”

The Court was called upon to examine whether the Administration, which in the present case comprised the Director of the Department of Town Planning and Housing as well as the Minister of Interior of the Republic, acted within the limits of its discretionary powers and in accordance with the principles of proper inquiry and adequate reasoning.

As already mentioned, the Administration dismissed the objections submitted by the landowners, the Applicants in the aforementioned recourses, on the basis that no further expansion of residential zones was necessary, as the existing ones were sufficient for the needs of the community, and that “it has been firmly established as State policy that existing zones (such as residential zones) are not expanded before they become saturated.”

However, the Administrative Court found that the procedure resulting in the said decision was affected by substantial procedural irregularities. In particular, it held that there had been no adequate examination of the Applicant’s objection, nor were important facts and circumstances set before the Administration, including the population growth of the community and the development prospects of the area, duly taken into account.

The Administrative Court observed that, although planning judgment lies primarily within the competence of the Administration and cannot and is not subject to substitution by the Court, the exercise of such discretion must be based on proper inquiry and adequate reasoning. In the present case, it was found that the reasons put forward were not adequately substantiated. The Administrative Court held that the cojoined administrative recourses “must succeed due to the absence of proper inquiry and adequate reasoning.”

Furthermore, the Court observed that, in certain respects, the Administration put forward arguments for the first time during the judicial proceedings, which had neither been presented nor relied upon in support of the original administrative decision, thereby constituting inadmissible retrospective justification.

The Court held that the Administration failed to fulfil its obligation of proper investigation and adequate reasoning, with the result that the rejection of the objections submitted by the landowners was legally defective. Consequently, it annulled the challenged decision in respect of the disputed properties and awarded legal costs in favour of the Applicants.

It should be emphasised that the said decision does not annul the planning framework as such, but rather affirms the stringent judicial review of the administrative process. Even in planning matters, the Administration is obliged to fully examine the evidence of each case and to state clear and specific reasons for dismissing any objections.

In conclusion, it is noted that in cases where the Administrative Court annuls an administrative decision due to a breach of the principles of proper inquiry, adequate reasoning, or other legal defect, as in the aforementioned judgment, the Administration is under a legal obligation to fully comply with the annulment decision. This entails that the Administration must re-examine the matter, taking into account the Court’s reasoning, and issue a new administrative act which must be fully reasoned and substantiated, based on adequate investigation and in compliance with the principles of administrative law.

This re-examination is not a mere formal act, but a substantial obligation of compliance with the annulment judgment, as the Administration is bound by the Court’s legal findings. In the event that the Administration fails to comply, namely, to re-examine its annulled decision, the individual concerned is entitled to file a new recourse before the Administrative Court. In such a case, the new recourse will relate to non-compliance, that is to say, the Administration’s failure to comply with the annulment, and not to the original decision which has already been set aside.