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El blog de Maria

Your daily Spanish Law reporter. Have it with a cafe con leche. www.costaluzlawyers.es

Legal tip 420. NEW! Bank risponsabilities ex 1.2 Law 57/68: new case law
Friday, December 31, 2010 @ 1:03 PM

Very recent, dated the 25th of November 2010:

Case Law by Cantabria Appeal Court, section 4, in Santander. A new great judicial understanding of Law 57/68:

Some relevant statements of said Court decission:

In THIRD paragraph: Law 57/68 aims for the protection of the buyer when he advances good amounts of  money before the house is built, covering breaches of the developer and unsolvency ( more or less fortuitous) as it has been frequent in recent times. The rules contained in said Law are imperative and cannot be waived. The  advanced payments of the buyer before the building, is balanced with the obligation of the existence of this Guarantee or Insurance Policy ( several Court decissions since 2005 to our days back this).

It is a matter of contract balance again. Balance of risks and guarantees.

In FIFTH paragraph: The imperative and inalienable rules contained in Law 57/68 are obligatory to developers, banks and Insurance entities. The breach of these obligations by professionals: developers and financial institutions can never be to the detriment of the buyer.

In SIXTH paragraph: The legal relationship between buyer and Financial Institution it is not out of the contract but out Law 57/68. Law requires the financial institution to guarantee all deposited amounts:

1. Through the opening of a special Bank account

2. Through the custody of said special account so that all the amounts paid as advanced payments are effectively deposited in said account.

3. Through the transfering into that account of all amounts which might be paid into a different account

4. Through the vigilance for all the amounts to be used for building purposes.

The Finantial Institution needs to know the business of the developer and request this to notify in an exact way all amounts paid by each one of the buyers so, the Bank Guarantee is for all amounts.

The only statement that it is not in this Court decission, because it is not what the Judge is deciding about with the same is what Law 57/68 sayd undoubtedly: The bank receiving adavance amounts needs to request the existence of those Bank Guarantees under its risponsability.

In our Civil Law legal system we do not need a judicial statement for something to be linking/applicable Law.

 Catedral de Ronda by Merlin_1 at Flickr.com

 



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3 Comments


Keith said:
Sunday, January 2, 2011 @ 10:22 PM

Fantastic news María - this Case Law can surely be used to strengthen many other Bank Guarantee cases.

The tide is slowly changing.

Kind regards

Keith


rob said:
Wednesday, January 19, 2011 @ 12:12 PM

Hi i have got a court case in february against a developer who took my cash but did not build and we were meant to have bank gaurentees in place but apparently not. Also some one from the bank is appearing . Would it be worth taking this information with me or will the judge be fully aware of all these details?


Maria said:
Wednesday, January 19, 2011 @ 12:18 PM

Dear Rob:

I do not fully understand your message, please email me to webatcostaluzlawyers.es

Best regards,

Maria


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