El blog de Maria

HUMA MEDITERRANEO - BANK ACTION WON IN PROVINCIAL APPEAL COURT AGAINST BANCO POPULAR

Notification sent today to one of our clients, a buyer of a property from Huma Mediterraneo, informing them that the Appeal filed by Banco Popular against the First Instance Sentence has been dismissed by the Provincial Appeal Court.


Please find attached Sentence number xxx/14 from the Provincial Appeal Court Section 1 in Murcia.

The Appeal filed by BANCO POPULAR ESPAÑOL S.A. has been dismissed and the First Instance Sentence has been confirmed.

The final paragraph of the Provincial Appeal Court Sentence delivered on 24 November 2014 states:

“That in dismissing the Appeal filed on behalf of BANCO POPULAR ESPAÑOL S.A. against the Sentence dated 29 April 2014 from the First Instance Court No. 4 of Murcia in Ordinary Trial number xxx/xxxx, we confirm that Sentence and impose upon the appellant Bank the costs of this Appeal”.

In the First Instance Sentence the Purchase Contract was terminated and HUMA MEDITERRANEO S.L. was sentenced to refund the amount of xx,xxx€ plus legal interest.  HUMA MEDITERRANEO S.L. did not Appeal.

BANCO POPULAR ESPAÑOL S.A. was sentenced jointly to refund the amount of XX,XXX€ plus legal interest on that amount from the date of filing of the Lawsuit (April 2012). BANCO POPULAR ESPAÑOL S.A. appealed and its Appeal has now been dismissed and the First Instance Sentence has been confirmed.

The Costs of the Appeal have been imposed on BANCO POPULAR ESPAÑOL S.A.

The Banks Appeal was based on 3 main arguments:

1.  The Bank said that the off-plan deposit was paid via a Conveyancing Lawyer and that the Bank issued Guarantees whenever it was asked by Huma.  The Appeal Court Sentence dismissed this argument because it says that:

“the Buyer proved with documents provided to the Court that the off-plan payments were made to an account in the name of Huma Mediterraneo at Banco Popular and that account must be regarded as a Special Account under the terms established and required by Article 1.2 of LEY 57/1968.  The Bank in which the account was opened and off-plan funds received, must according to the Law, under its responsibility, demand the issuing of the corresponding Guarantee.  The consequences of the Bank failing in this responsibility will harm the buyer who acts on trust according to the provisions of the Law, which grants rights of an inalienable nature according to Article 7 of LEY 57/1968.  The fact that the buyers hired the services of a conveyancing lawyer and paid the off-plan deposits to the developer’s Banco Popular account via the lawyer, in no way detracts from what is explained above”.

2. The Bank argued that the various Case Law examples of the Supreme Court cited in the First Instance Sentence relate to Insurers and not a Financial Institution such as a Bank and seeks to rely on the Supreme Court Sentence dated 5 February 2013.  The Appeal Court Sentence dismissed this argument as follows:

“Already discussed above are the reasons why the bank should secure the amounts deposited in the account which has been opened by the developer and the legally established responsibility of demanding the corresponding guarantees”.

3.  Finally the Bank argues that the obligation to provide the Guarantees is that of the Developer and not the Bank, as the buyers have no direct relationship with the Bank.  The Appeal Court Magistrates state in the Sentence:

“This plea must also be dismissed because the guarantees must be required by the Bank opening the account, under its responsibility.  The buyer paying amounts before or during construction in good faith must do so in a confident manner, which is the reason why LEY 57/1968 stated in its preamble that the standards are mandatory to ensure the actual return of money paid by purchasers and prospective owners of housing under construction in the event that the building does not take effect”. 

Alcantarilla, Murcia, East of Spain