1) May 2006: Signed a contract for an off plan property, estimated delivery date 18 months from the building permit.
2) January 2010: No building permit, no brick.
3) I have no interest in that purchase ... can I solve?
According to the Civil Law doctrines of "loss of the thing due" we can affirm that the delay of the start of construction for a period of several months, without good cause and non expressly allowed by the consumer, gives ground for contract cancellation.
According to Sentence of the Provincial Appeal Court of Valencia dated September 2009, Case law has broadly held and established that a situation of abnormality, resistance or excessive delay opens the gate to cancellation. As these irregularities break the interest in the contract originally agreed, or turn it into useless and even harmful, frustrating the contract's inherent economic order which is within the cause, breaking the mutual contract good faith” ( FRAGRANTE FIDEM, FIDES NON EST SERVANDA”.
The Supreme Court, as it is mentioned in the referred Sentence of Valencia "has set that time deadlines as an essential term of the contract (STS 15/11/1977, 27/5/1987, 13/3/1987, 6/6/1991, 16 -3-2009).
Continuing the Valencian Court saying that "it is irrefutable under the rules of logic and sound criticism, that the inordinate delay in fulfilling the contract defeats the purpose, because the future purchasers can not be left indefinitely to the developer´s will, being this also expressly prohibited by article 1256 of the Civil Code, which says: “The validity and enforceability of contracts can not be left to one party"
Similarly, the Supreme Court ruled in 1998 (14 November), that "The seller is not an arbitrator who can decide when a contract needs to be fulfilled, depending on his interests or conveniences, provided the buyer complies its obligations”
How is this all covered by Real Estate Consumer Law?
Firstly and again: Articles 2 and 3 of Law 57/68 so forgotten and much-criticized at times, to whose I make now a reminder of their last rationale, or ratio iuris: the protection of large sums of money advanced by the client to the developer for the construction of a very important good as housing is “These two articles empower the consumer to decide between extending timeframes or cancelling the contract if the house has not been started or completed on time”.
Considerations on the speculation on real estate unit and the economic crisis lying on developers can not languish the protective force of these provisions from 1968. Being this Law a great tool for a sustainable urban development (so much being on discussion these days).
Secondly: The model contract (stipulation first) signed under the roof of the National Consumer Institute in 2001 to buy / sell off plan and its General Conditions (General condition Six A, Second Paragraph). They ask for clarity on the start date and delivery date.
Thirdly: Under the present legislative decree on Consumers rights this uncertainty in the start and delivery dates are considered “abusive2 terms (Article 85.1).
In my opinion the declaration of the abusive character of a clause which puts beginning or finishing under indetermination, as these timeframes are deemed essential by the Supreme Court, should lead to the possibility for the consumer to the reduction in the price or termination of the contract.
Saying this under the doctrines on object contract loss, essential terms and cancellation, Articles 83 and 85 of Consumers Act Integration of contract clauses and article 2 and 3 of Act 57/68.
María L. de Castro
www.costaluzlawyers.es
Winter Surf Day. Gijón. Spain by Todo-Juanjo at Flickr.com
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