El blog de Maria

We were very happy to tell our clients recently that we had won their LEY 57/1968 Bank Action case against Caixabank in the First Instance Court in Malaga for an off-plan property they reserved at Guadalupe Hills from the developer Proverte through the agent Ocean View.

No Individual Guarantee

Our clients paid their off-plan deposit to the developer’s account at Caixabank (formerly La Caixa).  Caixabank did issue a General Guarantee to Proverte/Ocean View but failed to issue or verify the existence of the Individual Guarantee.

First Instance Court Sentence

The First Instance Court has found Caixabank guilty according to its obligations under Article 1.2 of LEY 57/1968 and sentenced the Bank to refund the full amount of the off-plan deposit plus legal interest from the date the buyers paid to the developer’s account.  Legal costs of the First Instance procedure are also imposed on the Bank.

Interesting Statements from the First Instance Sentence

“The plaintiffs filed a Lawsuit against Caixabank, requesting the conviction of the bank according to its responsibility under LEY 57/1968.  The plaintiff requested the refund of the total amount paid to the developer’s bank account under the Purchase Contract plus interest & costs.

On 25 October 2004 the plaintiffs signed a Purchase Contract through the real estate agent, Ocean View Properties SL to purchase a property in the development ‘Guadalupe Hills’ from the developer Proverte SL.  Caixabank issued a General Guarantee for the amount of two million euros.

In 2008 the plaintiffs filed a Lawsuit against Proverte SL & Ocean View Properties SL.  In 2011 the First Instance Court No. 14 of Malaga upheld the Lawsuit cancelling the purchase contract and condemning Proverte SL & Ocean View Properties SL jointly to return to the buyers the amounts paid.  The enforcement procedure in 2012 failed as the defendants had no assets for seizure.

The promotor was the policyholder of a General Guarantee for the return of the amounts paid by buyers to Ocean View Properties SL, granted in compliance with LEY 57/1968 and formalized on 25 October 2006.

The Bank opposed the Lawsuit firstly on the grounds that the General Guarantee under which the claim is filed is granted to Proverte SL and Ocean View Properties SL, the latter being the only beneficiary thereof, and secondly on the matter of Res Judicata (a matter already judged) as it says the amounts claimed in the proceedings in the First Instance Court No. 14 of Malaga against Proverte SL & Ocean View Properties SL are the same amounts being claimed in this Lawsuit.

This Court does not agree with either objection.  Res Judicata is not applicable because the previous procedure had different defendants. The previous action was for cancellation of contract due to delay and the current action is for the breach of liability of the Bank according to Article 1.2 of LEY 57/1968.

With regards to the General Guarantee and the responsibility of Banks & Savings Banks according to Article 1.2 of LEY 57/1968, these matters are confirmed in the Supreme Court Sentences dated 9 March 2016 & 21 December 2015.

In our opinion the forcefulness of the Supreme Court Sentences confirms the Bank’s commitment under the General Guarantee and liability for the amounts received in the developer’s accounts opened in its branches for which the corresponding Individual Guarantees were not issued.

In accordance with Article 394.1 of the Civil Procedure Act, having fully upheld the Lawsuit the costs must be imposed on the defendant bank”

Possible Provincial Court Appeal

CAIXABANK has 20 working days from the date of notification of the Sentence, which was 9 November 2016, to comply with the Sentence or to file an Appeal to the Provincial Appeal Court of Malaga.

Although Appeals must be submitted strictly within a 20 working day deadline, we do not normally receive notification of an Appeal or of a firm sentence from the Court until a few weeks after the deadline due to the workload of the Court.

If an Appeal to the Provincial Appeal Court is filed by the Bank it will be necessary for us to file an Opposition to the Appeal on behalf of our client.

Case won in the Provincial Appeal Court against CAIXABANK for an off-plan property from Pastor Selected Villas International at Los Altos de la Pedrera

Our clients were extremely pleased to hear recently that we had won their LEY 57/1968 Bank Action case against Caixabank in the Provincial Appeal Court.

No Individual Guarantee

They did not receive an individual Guarantee from the developer, Pastor Selected Villas International S.L. or from the Bank to which their off-plan deposit was paid, CAIXABANK (formerly LA CAIXA).

First Instance Court Sentence

The First Instance Court found Caixabank guilty according to its obligations under Article 1.2 of LEY 57/1968 and sentenced the Bank to refund the full amount of the off-plan deposit plus legal interest from the date the buyers paid to the developer’s account.  Legal costs of the First Instance procedure were not imposed on the Bank due to the fact that the Judge was of the opinion there was conflicting jurisprudence regarding banks liabilities according to LEY 57/1968 at the time the Lawsuit was submitted.

The Appeal

Caixabank filed an Appeal against the First Instance Sentence.  The Provincial Appeal Court of Alicante dismissed the Bank’s Appeal and fully confirmed the First Instance Sentence.  Costs of the Appeal were imposed on Caixabank.

The Appeal Court Magistrates based its decision to dismiss the Caixabank Appeal mainly upon the Supreme Court Sentences dated 29 June 2016, 22 April 2016, 9 March 2016, 23 September 2015 & 21 December 2015.

Important Statement from the Appeal Court Magistrates

“It is proven that the Bank was aware of the housing development, opened an account for the developer and granted a mortgage loan for the development.  As soon as the amounts are paid by buyers to the bank account of the developer, whether or not the account is a Special Account the liability for the corresponding Guarantee will be established for the total amount paid by the buyers into the developers account opened at that Bank.

Thus the obligation of the appellant to reimburse the amounts entered by the plaintiff is evident and the appeal must be dismissed”

Possible Supreme Court Appeal

CAIXABANK has 20 working days from the date of notification of the Sentence, which was 10 November 2016, to comply with the Sentence or to file a Cassation Appeal to the Supreme Court.

Although Appeals must be submitted strictly within a 20 working day deadline, we do not normally receive notification of an Appeal or of a firm sentence from the Court until a few weeks after the deadline due to the workload of the Court.

If a Cassation Appeal to the Supreme Court is filed by the Bank it will be necessary for us to file an Opposition to the Appeal on behalf of our client.

Today, I saw a Court decission by Appeal Court in Málaga, by which a purchase in Lagos de Santa María has been cancelled and refund made obligatory to the Bank even after completion and registration at the Land Registry. Bank has been obligued to refund all payments, plus legal interests, plus legal costs.

I guess the mortgage loan has been cancelled too.

A good solution to you all who are paying huge loans on illegal properties

LEY 57/1968 Won Case in First Instance Court against BANCO POPULAR for our client who purchased an off-plan property from the developer AIFOS at El Balcón de Hipódromo

We were pleased to inform our client recently that we had won their case against BANCO POPULAR in the First Instance Court.  The client did not receive an individual Guarantee from the developer, AIFOS or from the Bank to which their off-plan deposit was paid, Banco de Andalucía (now Banco Popular).  Banco de Andalucía did issue a General Guarantee to Aifos for its various developments in 2006.

Re: YOUR CASE AGAINST BANCO POPULAR
PO xxx/2016

Please find attached Sentence No. xxx/2016 from the First Instance Court No.19 in Malaga.

Your case against BANCO POPULAR has been won.

The final paragraph of the First Instance Sentence delivered on 15 September 2016 and notified on 16 September 2016 states:

“Upholding the Lawsuit filed on behalf of xxxxx against the entity BANCO POPULAR I condemn the said defendant to pay the amount of xx,xxx€ plus interest at the legal rate from the date the funds were paid to the developer, with imposition of costs of this procedure on the defendant”


So BANCO POPULAR is sentenced to refund the amount of xx,xxx€ plus interest at the legal rate from the date the funds were paid to the developer.

Costs of the First Instance Procedure are imposed on the Bank.

Interesting statements from the Judge in the Sentence were:


“In February 2016 the plaintiffs filed a Lawsuit against Banco Popular, requesting the conviction of the bank according to its responsibility under LEY 57/1968.  The plaintiff requested the refund of the total amount paid to the developer under the Purchase Contract plus interest & costs.

The Bank opposed the Lawsuit on the grounds that the contract was signed with Aifos Comercalizadora de Promociones S.L. and not Aifos Arquitectura y Promociones Inmobiliarias S.A., which are legally independent companies.  Also it states that Banco Popular, Banco de Andalucía & Banco Pastor had no relationship with the first company.  The Bank also stated that there was no evidence to show that the property was acquired as a family home for permanent or seasonal residence as required by LEY 57/1968, that the first deposit payment was not recognised in the contract, that the Letras de Cambio (bills of exchange) were not paid to Banco de Andalucía and that other banks had also formalized General Guarantees with Aifos.  Finally it stated that the General Guarantee issued by Banco de Andalucía (now Banco Popular) to Aifos dated 18 May 2006 does not constitute a Guarantee for third parties and it was Aifos who was responsible for submitting the purchase contracts and requesting the individual guarantees.  Neither the buyers nor Aifos requested the individual guarantee.

On 27 February 2004 the plaintiffs signed a Purchase Contract with Aifos Arquitectura y Promociones Inmobiliarias S.A, actually the entity Aifos Comercializacion de Promociones S.L. (as expressly stated in document 2 of the Lawsuit) for the purchase of a home situated in Mijas, in the development El Balcón de Hipódromo.  The buyers paid xx,xxx€ as in initial deposit at the time of signing the contract, xxx,xxx€ was to be paid by subrogating the builders mortgage and xx,xxx€ by 3 Bills of Exchange with quarterly payment dates starting 27 August 2004.

The purchase contract stated in clause 6 that if the contract was resolved for the reasons specified in Article 3 of LEY 57/1968 then the amounts paid will be returned to the purchaser together with legal interest.

The property was not built and Aifos was declared bankrupt.

Evidence presented confirms there was a General Guarantee issued to Aifos by Banco de Andalucía (now Banco Popular) for its various promotions.

With respect to the non-application of the Guarantee according to the scope of LEY 57/1968, there is no evidence to show that the property was purchased speculatively and that the buyers should be considered as investors.  Therefore the protective nature of the Law should be applied to the buyers.

As for the lack of proof of delivery of amounts, evidence has been provided for all payments.  The fact that Aifos did not pay the bills of exchange into Banco de Andalucía, but to another bank, does not remove the protection offered to the buyer according to the General Guarantee under LEY 57/1968.  This is confirmed by the Sentence of Section 4 of the Provincial Appeal Court of Malaga dated 10 September 2015 and the recent Supreme Court Sentence dated 21 December 2015.

Also clarifying the position of the Supreme Court are the Sentences dated 13 & 23 September 2015 and the recent Supreme Court Sentence dated 22 April 2016.

This is why applying the doctrine exposed the fact that the defendant bank only issued a General Guarantee to Aifos, does not exclude its primary obligation which was to refund the amounts and issue individual guarantees.  The fact it did not issue the individual guarantees cannot harm the buyers.

Interest should be paid from the date each payment was made to the developer by the buyers.

In accordance with Article 394 of the Civil Procedure Act, having fully upheld the Lawsuit the costs must be imposed on the defendant bank”


BANCO POPULAR had 20 working days from the date of notification of the Sentence, which was 16 September 2016, to comply with the Sentence or to file an Appeal to the Provincial Appeal Court of Malaga.

We were notified recently that the Bank has filed an Appeal to the Provincial Appeal Court of Malaga.

LEY 57/1968 Won Case in First Instance Court against BBVA for our client who purchased an off-plan property from the developer Herrada del Tollo at Residencial Santa Ana Del Monte

We were pleased to inform our client recently that we had won their case against BBVA in the First Instance Court.  The client did not receive an individual Guarantee from the developer, Herrada del Tollo S.L. or from the Bank to which their off-plan deposit was paid, BBVA.

Re: YOUR CASE AGAINST BANCO BILBAO VIZCAYA ARGENTARIA S.A. (BBVA)
PO xxxx/2012

Please find attached the Sentence No. xxx/2016 from the First Instance Court No.5 in Orihuela.

Your case against BANCO BILBAO VIZCAYA ARGENTARIA S.A. has been partially won.

The final paragraphs of the First Instance Sentence delivered on 18 October 2016 and notified on 19 October 2016 state:

“Upholding the Lawsuit filed on behalf of xxxxx against BANCO BILBAO VIZCAYA ARGENTARIA S.A. I condemn the defendant to pay to the plaintiffs the amount of xx,xxx Euro being the amount paid on 24 May 2006 to the account opened by the developer in BBVA, plus legal interest from the date of delivery of the deposits in the current accounts of BBVA until the full repayment.

I do not condemn the costs of these proceedings on any party”

So BBVA is liable, according to Article 1.2 of LEY 57/1968, to refund to you the amount of xx,xxx€ plus legal interest from the date the amount was paid to the developer’s bank account which was 24 May 2006.

The Judge did not impose costs on any party.  Therefore, each party will pay its own costs.

BBVA was found liable according to Article 1.2 of LEY 57/1968 for the actual amounts you paid to the developer’s accounts opened in their branches.

With regards to the conviction of BBVA according to its responsibility under Article 1.2 of LEY 57/1968, interesting statements from the Judge were:

“BBVA stated in its defence that the accounts to which the buyer’s funds were paid was a normal current account and not a Special Account.  However, it is clear that the credits to this account was frequent and continuous and that the account was intended for use as an account to receive funds from off-plan buyers.  Therefore, despite the fact that it was called an ordinary current account it must be considered as a Special Account according to LEY 57/1968.

This then generates a legal liability for the buyers funds paid to this account.  If the Bank fails in this legal responsibility then it must respond to the damages caused to the buyers due to its failure”


BANCO BILBAO VIZCAYA ARGENTARIA S.A. has 20 working days from the date of notification of the Sentence, which was 19 October 2016, to comply with the Sentence or to file an Appeal to the Provincial Appeal Court of Alicante.

If an Appeal is filed by BANCO BILBAO VIZCAYA ARGENTARIA S.A. it will be necessary for us to file an Opposition to the Appeal on your behalf.

LEY 57/1968 Won Case in First Instance Court against BANCO MARE NOSTRUM for our client who purchased an off-plan property from the developer Promociones Inroal at Andrax, Almería

We were pleased to inform our client recently that we had won their case against Banco Mare Nostrum in the First Instance Court.

The client received an individual Guarantee from the Caja Granada (now Banco Mare Nostrum).  The purchase contract was cancelled by private agreement in 2008.  The Bank paid the principal amount of the Guarantee but did not pay the interest that was due.

The First Instance Court has now ruled that Banco Mare Nostrum must now pay the unpaid interest plus legal interest on that amount from the date the Lawsuit was filed.  Costs of the First Instance procedure are imposed on the Bank.

Re: YOUR CASE AGAINST BANCO MARE NOSTRUM S.A.
PO xxx/2015

Please find attached Sentence No. xxx/2016 from the First Instance Court No.42 in Madrid.

Your case against BANCO MARE NOSTRUM S.A. has been won.

The final paragraph of the First Instance Sentence delivered on 10 October 2016 and notified on 14 October 2016 states:

“Upholding the Lawsuit filed on behalf of xxxxx against the entity BANCO MARE NOSTRUM S.A. I condemn the said defendant to pay the amount of x,xxx€ plus interest at the legal rate from the date the Lawsuit was filed, with imposition of costs of this procedure on the defendant”


So BANCO MARE NOSTRUM is sentenced to refund the amount of x,xxx€ plus interest at the legal rate from the date the Lawsuit was filed which was June 2015.

Costs of the First Instance Procedure are imposed on the Bank.

Interesting statements from the Judge in the Sentence were:


“Based on the Law, LEY 57/1968, the defendant bank issued an Individual Bank Guarantee to the plaintiff for xx,xxx€ for the purchase of a property from Promociones Inroal S.L. in Andrax, Almería.  Construction of the property was not started and the purchase contract was cancelled by private agreement dated 23 April 2008 requiring the defendant bank to pay the amounts guaranteed plus legal interest.

The bank only paid the principal amount but did not pay the interest which amounted to x,xxx€.

The bank defended the Lawsuit by saying that it paid the principal amount and that the buyer was satisfied with that.

The bank does not question the validity of the guarantee, nor its purpose.  Neither does it question the complete failure of the developer to construct the property.

In these circumstances and based on the individual guarantee issued by the bank under the then Law, LEY 57/1968 (now repealed), the buyers are entitled to reimbursement not only of the principal amount but also legal interest.

Accordingly, for the foregoing reasons, the Lawsuit is fully upheld and the Bank is sentenced to pay the x,xxx€ of unpaid interest plus this amount will also accrue interest at the legal rate from the date of filing of this Lawsuit”


BANCO MARE NOSTRUM has 20 working days from the date of notification of the Sentence, which was 14 October 2016, to comply with the Sentence or to file an Appeal to the Provincial Appeal Court of Madrid.

Although any appeal must be submitted strictly within the 20 working day deadline, we may not receive notification of an Appeal or of a firm sentence from the Court for a few weeks after the deadline due to the workload of the Court.

If an Appeal is filed by BANCO MARE NOSTRUM it will be necessary for us to file an Opposition to the Appeal on your behalf.

LEY 57/1968 Won Case in First Instance Court against CAJA RURAL CENTRAL for a group of our clients who purchased off-plan properties from the developer Promociones Eurohouse at Fortuna Hills Golf Resort & Residencial Los Balcones del Valle

We were pleased to inform our clients recently that we had won their case against Caja Rural Central in the First Instance Court.  The clients did not receive an individual Guarantee from the developer, Promociones Eurohouse 2010 S.L. or from the Bank to which their off-plan deposit was paid, CAJA RURAL CENTRAL.

Re: YOUR CASE AGAINST CAJA RURAL CENTRAL
PO xxxx/2012

Please find attached Sentence No. xxx/2016 from the First Instance Court No.4 in Orihuela.

Your case against CAJA RURAL CENTRAL has been won.

The final paragraph of the First Instance Sentence delivered on 1 September 2016 and notified on 6 September 2016 states:


“Upholding the Lawsuit filed by xxxxxx against the entity CAJA RURAL CENTRAL I condemn and order the defendant to pay to the plaintiffs the total amount of xx,xxx€ plus interest at the legal rate from the date the funds were deposited in the account opened by the developer in Caja Rural Central until full repayment.

Without the express imposition of costs of the proceedings”


So CAJA RURAL CENTRAL is sentenced to refund the total amount of xx,xxx€ plus interest at the legal rate from the date the funds were paid into the developer’s account opened at Caja Rural Central.

The Judge did not impose costs on the bank; therefore each party will pay its own costs.

Interesting statements from the Judge in the Sentence were:


“On 22 November 2012 the plaintiffs filed a Lawsuit against Caja Rural Central, requesting the conviction of the bank according to its responsibility under Article 1.2 of LEY 57/1968.  The plaintiff requested the refund of the total amount paid to the developer under the Purchase Contract plus interest & costs, alternatively, the amount actually credited to the Caja Rural Central account opened by the developer.  The total off-plan deposit was 141,925.34€ and the amount proved to be paid to the Caja Rural account was 68,940.30€.

The plaintiffs had purchased properties from the developer Promociones Eurohouse 2010 SL in the Fortuna Hills Golf Resort and in Residencial Los Balcones del Valle.  The properties were not constructed and the Purchase Contracts were cancelled in the insolvency procedure of the developer.

Caja Rural Central opposed the Lawsuit and said that it had not guaranteed the funds and that the funds were paid to an ordinary current account opened by the developer, over which the bank had no control or monitoring.  The bank denies all liability because it states that it has no contractual link with the buyers. 

The Preliminary Hearings were held on 6 March 2014 & 11 June 2015 & the Trial was held on 3 May 2016.

Documentary evidence was provided to prove that 68,940.30€ was entered into the Caja Rural Central account opened by the developer.

The witness on behalf of Caja Rural, who was Director of the branch in which the account was held from 2005 to 2007, gave evidence at the Trial.  He stated that the account was an ordinary account opened by the developer and that he did not know that the amounts paid into that account were for the purchase of off-plan housing because Caja Rural did not fund the developer.  He said that it was not possible to control and monitor income in this type of account and that he was unaware of the legal obligations imposed on banks.

However the fact remains that bank knew this account was opened by a company dedicated to the construction and promotion of off-plan properties.  One just has to look at the historical movements of the account to see that it was funded largely by amounts paid by buyers to purchase their off-plan homes

It is evident that the account is to be considered as a Special Account according to the Law. 

Therefore, having opened an account for an off-plan property developer, the bank has a legal duty to ensure these funds were guaranteed by an Insurance Certificate or Bank Guarantee.  Having failed in its legal duty, the bank then has a legal liability.

The bank should not allow the opening of accounts or the placing of deposits in those accounts, without first ensuring that the developer has assumed a legal obligation to guarantee the repayment of the funds. 

It should be noted that Article 1 of LEY 57/1968 in its quest to protect purchasers of off-plan homes also involves the financial institutions in which the developer opens accounts for the receipt of buyer’s funds.  It establishes an obligation on the bank, ‘under its responsibility’, to ensure that the developer has guaranteed the buyer’s funds according to the Law.  This does not mean that the financial institution receiving the money has to issue the Guarantee, because it can be a Guarantee from another entity, but the entity receiving the money must ensure the Guarantee is issued.  If it fails in this legal obligation then it must be liable to the buyers for the money it received.

LEY 57/1968 Won Case in Provincial Appeal Court against CAIXABANK for our client who purchased an off-plan property from the developer Promociones Eurohouse at Residencial Fortuna Golf Resort

We were pleased to inform our client recently that we had won their case against Caixabank in the Provincial Appeal Court.

The client did not receive an individual Guarantee from the developer, Promociones Eurohouse 2010 S.L. or from the Bank to which their off-plan deposit was paid, CAIXABANK (formerly LA CAIXA).

The First Instance Court found Caixabank guilty and sentenced the Bank to refund the principal plus legal interest from the dated of payment to the developer’s account.  Legal costs of the First Instance procedure were not imposed on the Bank due to the fact that the Judge was of the opinion there was conflicting jurisprudence regarding banks liabilities according to LEY 57/1968.

Caixabank appealed against the First Instance Sentence.  The Provincial Appeal Court dismissed the Bank’s Appeal and fully confirmed the First Instance Sentence.  Costs of the Appeal were imposed on Caixabank.

Re: YOUR CASE AGAINST CAIXABANK S.A.
PO: xxxx/2012

Please find attached Sentence number xxx/2016 from the Provincial Appeal Court of Alicante Section 9 in Elche.

I am very pleased to advise you that the Appeal filed by CAIXABANK has been dismissed and the First Instance Sentence has been confirmed.

The final paragraphs of the First Instance Sentence delivered on 23 October 2015 stated:


“That partially upholding the Lawsuit filed on behalf of xxxxx against the entity CAIXABANK S.A. I must condemn and order the defendant to pay the plaintiff the amount of xx,xxx€ plus legal interest from the date of payment of the amounts to current account of the company until the date of full payment.

There is no express imposition of costs”


The final paragraph of the Provincial Appeal Court Sentence delivered on 19 September 2016 and notified on 21 September 2016 states:


“Dismissing the appeal filed by CAIXABANK S.A. against the Sentence dated 23 October 2015 issued by the Judge of the First Instance Court No. 4 of Orihuela, we must confirm that Sentence.  We expressly condemn the appellant bank to pay the costs of this appeal”


So the Appeal filed by CAIXABANK has been dismissed and the First Instance Sentence is confirmed.

The costs relating to the Appeal are imposed on the Bank.

As per the First Instance Sentence CAIXABANK is liable to refund the amount of xx,xxx€ plus legal interest from the date of payment.  There was no imposition of costs in the First Instance Sentence; therefore each party will pay its own costs for the First Instance procedure.  Costs of the Appeal are imposed on the Bank.

The Appeal Court Magistrates based its decision to dismiss the Caixabank Appeal mainly upon the Supreme Court Sentences dated 16 January 2015, 20 January 2015, 22 April 2015, 30 April 2015 & 23 September 2015.

CAIXABANK had 20 working days from the date of notification of the Sentence, which was 21 September 2016, to comply with the Sentence or to file a Cassation Appeal to the Supreme Court.

Although any appeal must be submitted strictly within the 20 working day deadline, we may not receive notification of an Appeal or of a firm sentence from the Court for a few weeks after the deadline due to the workload of the Court.

If a Cassation Appeal is filed by the defendant it will be necessary for us to file an Opposition to the Appeal on your behalf.