Phase 3 and Bank Guarantees

Hi,

I have been informed by Pablo that the Phase 3 building licences have been received and that building will commence shortly.

Also I have been informed that Bank Guarantees do not need renewing as Spanish law has recently changed to say they are valid until completion and therfore the date of expiry is no longer valid. Is that what everyone else understands?

Regards,

Colin

Great news about the licences for P3.

As far as bank guarantees this is a post by Maria De Castro (Lawter) on La Tercia Real (developer gone bust) site.

Quote

_______________________

Maria L. de Castro, JD, MA

Lawyer

Director www.costaluzlawyers.es

Steve and Jane,

Thanks for the update on bank quarantees. With regard to Phase 3 what Pablo said was granted, hopefully that translate into received.

Colin

I spoke with Rosa there are no licenses for phase 3 yet. No need to update guarantees as there is a new law passed that allows these licenses to be valid until completion

I have spoken with a Spanish lawyer who says there has been no change in the law. He is dealing with this for me as he has office in Ireland and comes highly recommended. He feels that not renewing bank guarantees is a breach of contract on Calidonias part. I am hoping to get a group action in Ireland. It is very confusing the different legal opinions as Mario Castro feels that we dont need to update. Time will tell.

Hi Aaron

I found some information on Bank Guarantees that might be of interest on http://www.marbella-lawyers.com/articles/showArticle/spanish-bank-guarantees

Apparently according to the article, by law, the Bank Guarantee is valid until the Licence of first Occupation, although there is some contention if they have an expiry date - see point 2 under guarantee pitfalls.

I believe from what I have heard, the consensus is, that the expiry date will not run out until the LFO is granted, and in practice  a spanish judge would see it that way.

The law on the matter appears to have been passed in 1968, so I'm not sure why there are still expiry dates? ( unless there has been some update).  As you mentioned Maria de Castro has also said that the Bank Guarantees do not expire, to see a fuller explanation from her see http://www.eyeonspain.com/spain-magazine/bank-guarantee-legal.aspx

Also for interest,  here is a reply I had from Esther from Calidona on the matter (as I have 2 guarantees that have 'expired') : -

I hope this helps

kev

This message was last edited by kev2 on 21/06/2009.

The information that you have from the developer is correct and there have recently been a number of test cases that have proven this

The BG is actually vaild until you complete on the property