El blog de Maria

WON CASE in FIRST INSTANCE COURT AGAINST SGR & BBVA FOR HERRADA DEL TOLLO S.L. BUYER AT ‘RESIDENCIAL SANTA ANA DEL MONTE’

We were pleased to inform our clients today that we had won their case against SGR & BBVA in the First Instance Court.  The clients did not receive individual Guarantees from the developer, Herrada del Tollo S.L. or from the Bank to which their off-plan deposit was paid, BBVA or from the General Guarantor of the development, SGR.


Re: YOUR CASE AGAINST SOCIEDAD DE GARANTÍA RECÍPROCA DE LA COMUNIDAD VALENCIANA (SGR) & BANCO BILBAO VIZCAYA ARGENTARIA S.A. (BBVA)
PO xxxx/2014

Please find attached Sentence number xxx/2015 from the First Instance Court No.2 in Orihuela.

Your case against SOCIEDAD DE GARANTÍA RECÍPROCA DE LA COMUNIDAD VALENCIANA & BANCO BILBAO VIZCAYA ARGENTARIA S.A. has been won.

The final paragraph of the First Instance Sentence delivered on 26 October 2015 and notified on 26 October 2015 states:

“Fully estimating the Lawsuit filed on behalf of xxxxx xxxxx, against SOCIEDAD DE GARANTÍA RECÍPROCA DE LA COMUNIDAD VALENCIANA & BANCO BILBAO VIZCAYA ARGENTARIA S.A. I condemn the defendants jointly & severally to pay the plaintiff the amount of xxx,xxx Euro plus legal interest from the date of delivery or deposits in the current accounts of BBVA until the full repayment and legal costs”

So SOCIEDAD DE GARANTÍA RECÍPROCA DE LA COMUNIDAD VALENCIANA & BANCO BILBAO VIZCAYA ARGENTARIA S.A. are jointly & severally liable to refund the total amount claimed in the group Lawsuit which is xxx,xxx€ plus legal interest from the date each amount was paid to the developer’s bank account.


Particular points of interest stated by the Judge in the Sentence are:

“When interpreting and applying LEY 57/1968 of 27 July on receiving buyers amounts in advance for the purchase of homes under construction we should not forget the aim pursued by the same to protect consumers against real estate fraud.  Specifically, in the preamble of the Act it states that  ‘The justified alarm in public opinion has been the repeated commission of abuses, which, on one hand, constitute serious impairment in social interaction, and other obvious crimes besides causing irreparable damage to confidence and good faith which therefore requires to establish general preventive rules ensuring both the real and effective protection of the anticipated funds for purchasers of homes and for developers to return the funds on the assumption that building does not take effect’

Thus, such guiding principles of consumer protection – the right to decent housing and formalistic interpretations to the detriment of the consumer – we must consider in resolving the dispute subject to these proceedings.

All the rights and guarantees granted to the purchaser by Article 7 of LEY 57/1968 are of an inalienable character.

In this case SGR entered into an agreement with the developer and issued a consolidation policy to ensure repayment of the amounts of principal and interest paid by buyers.  Through this policy they wanted to meet the obligations imposed by LEY 57/1968.

Furthermore, BBVA also signed a general guarantee with the developer for the amounts paid on account by buyers.

The main defense argument put forward by the defendants is that the plaintiffs have no contractual relationship with them as individual guarantees have not been issued due to the fact that the amount covered in the general guarantees was exhausted by the developer.

Being a group insurance linked to a promotion the financial institution or insurance company is responsible for such consolidation.  They must ensure compliance with all legal obligations relating consumer protection.

The fact that despite the existence of General Guarantees, neither the developer, bank or insurer have been concerned with the legal obligation to issue the individual guarantees cannot harm the consumer.

This interpretive line of jurisprudence has recently been confirmed by the Provincial Appeal Court of Alicante, but fundamentally, by a judgment of the Supreme Court in September 2015 in relation to an identical case involving other buyers from Herrada del Tollo.

The absence of individual guarantees does not preclude the obligation to repay the amounts paid.  It is irrelevant to the case at hand that the guarantee line is exhausted.

Our jurisprudence has stated that the protection offered by LEY 57/1968 extends to all amounts paid irrespective of whether they are entered in the account detailed in the general guarantees.  The obligation to keep the funds in a special account cannot be imposed on the buyer. The lack of income in the special account is down to internal relations between the insurer and seller and cannot harm the buyer.

As for the claim by the defendants that the buyers had signed an agreement with the bankruptcy administrators of the developer, this does not extinguish the guarantee or liability of the insurers.

In our case the housing development is not even started so the frustration of the purpose of the contract is clear.

For all the above reasons we must uphold the claim made by the plaintiffs.

The defendants are also condemned to pay legal interest on the amounts claimed and such interest shall be computed from the date the amounts were paid to the account of the developer”

Orihuela, Alicante, East of Spain