Success claiming under a bank guarantee

  Hi all,

I want to pass on some good news to anybody claiming on a bank guarantee.  I have just received a settlement of my claim from ACC / Zurich on foot of my bank guarantee (related to Medina Golf outside Granada).  The good news is that having gone through the process of sueing ACC / Zurich to enforce the guarantee, they decided to settle before the case got to court.  This is a breakthrough for Medina Golf buyers and I hope that everybody else can now claim under their guarantee with a positive expectation that the case will be settled.

I settled for my original investment plus a portion of my legal costs.  I did waive the legal interest that I would have been entitled to if I had won the court case, but I was happy to negotiate a reasonable settlement and avoid the risk of taking it to court.  The settlement also means that I got my money back immediately, rather than risking a protracted court process in Spain.

I would be delighted to provide further details by private mail to anybody who is going through a similar process.  I can also recommend my lawyer, Miguel Gonzalez Raya, who is based in Almeria.  He has practical experience of negotiating a very good settlement for me.  

All the best in getting your money back, and many thanks to everybody who i exchanged emails with over the past year.  The EOS website was a godsend in providing me with practical information from others, and some hope that I would get my money back.

Good luck,

Donal79

Congratulations, having got our deposit back via bank guarantee in April this year, I know what a great relief it is to you and your family.

Now you can once again start enjoying life again. Cheers

Dave

Hi Donal79 and Dave

Congratulations to both of you on getting your deposit back.

It is pleasing to hear some good news stories regarding Bank Guarantees.

Let's hope that if we continue to apply pressure in all directions there may be many more good news stories to come for those of us that are not so lucky at the moment.

Kind regards

Keith

Donal79,

Well done. Did you have to take the developer to court alongside your claim against the Bank ?

Best regards.

 Hi Ads

I did not sue the developer as I had cancelled the purchase contract and therefore no longer had any contractual relationship to sue under.  My claim was against the bank guarantee which the insurance company refused to honour for over 12 months.  They eventually negotiated when the court case was listed to be heard.  Hope that helps, and good luck with your case.

Regards

Donal79

Donal79,

Thanks for that. But how did you cancel your contract without taking the developer to court? Perhaps I'm missing something here relating to Bank Guarantees?

 Hi Ads,

I cancelled the contract on the basis that the developer had failed to fulfill it (the apartment was not finished on time) as i was advised by my lawyer.   My action was open to challenge by the developer but I heard nothing.  How could they challenge when the development is over 2 years late, and showing no sign of being completed?  They are demonstrably in breach of the contract.

The insurance company tried to use the fact that the administrator for the developer had not agreed to cancel the contract as a means to refuse to pay out on the bank guarantee.  It seems that the insurance company realised that this position would probably not hold up in court, so they decided to settle.

D

Thanks Donal79, this may well help many in similar circumstance to yourself, but it begs the question are many going down the route of suing the developer unnecessarily? Perhaps Maria can advise....

Hi Ads

The first stage of making a claim against the developer or the bank for the return of your deposit is for your Lawyer to issue the Official Cancellation Burofax which states your reasons for cancelling the contract.

If the developer replies and refuses to accept the cancellation or wishes to contest the cancellation – then you have to proceed with legal action……………against the developer to enforce the cancellation of the contract.

You can then also take simultaneous legal action against the bank or insurance company if you have a case according to LEY 57/68.

What I understand from Donal79’s posting is that his Lawyer sent the Cancellation Burofax to the developer but the developer’s administrator did not challenge the cancellation of the contract.  So therefore his Lawyer proceeded with action against ACC / ZURICH to execute the insurance certificate/bank guarantee.

It seems like the ACC / ZURICH did not pay out willingly and made Donal79’s Lawyer prepare the legal case but then realised that as the developer was 2 years behind with the build schedule and had obviously breached the terms of the contract there was little point in taking the matter all the way to court.  So they offered an out of court settlement which Donal79 accepted.

Kind regards

Keith

Thanks Keith,

Informative as ever!

Looks as though the developer is off the hook then?

Also the purchaser is out of pocket to the tune of legal costs and interest that were not acheived.

A compromise yes, and effective return of monies, which is of major importance, but it doesn't solve the problem of making the developer accountable for his actions, or act as any disincentive for other developers to do likewise does it? Unless of course the insurance company take action against the developer thereafter......

Presumably because this was settled out of court this won't assist BG case law?

 I'm really happy for Donal79 however!

Hi Ads

I would imagine the insurance company and/or bank will take legal action against the developer to recover their funds.  If they fail with that option then they probably also have a first charge on many of the properties at the development.  The Banks are always the preferential creditors after all.......!!

So the developer may not get away with it totally.

Correct - out of court settlement - no case law here - but good news for Donal79 none the less.  And....good news for other buyers at Donal79's development of Medina Golf who are currently trying to execute their Bank Guarantees..........!!

Kind regards

Keith

Dear Ads:

As Keith has very correctly said, cancellation of the contract here means just issuing a notice to developer stating your cancellation rights and asking for the refund of the money. Then if there is no settlement with developer ypui can just keep ahead with the Guarantee route. Of course there is no need of litigation against developer for the cancellaton of the contract to be performed before requesting the Insurance company or Bank to pay.

Keith - It's great news that Donal79 has obtained a settlement.  Unfortunately many (most?) of us who were buying at Medina Golf didn't get a bank guarantee so we are left in a position of having to sue the developer and the bank for return of our money.

As a result I'm just about to fill in your petition!

Cardifflan

We will be pleased to add your voice to the petition.

Two important points to establish on your development, Medina Golf, if you can are:

Did those purchasers who received Bank Guarantees pay their deposits to the same Bank or Savings Bank as those who did not receive Bank Guarantees?

If the answer to the above question is Yes, then did purchasers with Bank Guarantees pay their deposits to the same account at the same Bank as purchasers without Bank Guarantees?

They are two very important questions for any purchaser on any development to try and obtain the answers to if they are considering taking action according to LEY 57/68 against the Bank who accepted the off-plan deposit into their custody.  If the answer to both questions is yes, it will show that the Bank were negligent and failed to act with even the minimum due diligence.

Kind regards

Keith

So happy for you .Thankyou for sharing  your good result with everyone on eos.We hope,one day we can do the same,although we have no bank guarantee,we still have hope!

Melcar

I am pleased you still have hope.

If you have not already done so, please add your voice to the Bank Guarantees Petition at:

www.bankguaranteesinspain.com

Kind regards

Keith

Melcar

Which development did you purchase on?

Were any purchasers on your development provided with Bank Guarantees?

Kind regards

Keith

This is the first time I have posted a message on EOS, but thought I must do so now, as it was all the comments

on here that led me to the success I have had in just getting all my deposit inc. interests returned to me.

It is the end of four long years of increasing worry, stress and frustration, but it was through this site I finally

sought the help of Maria and her team at Costaluz Lawyers. They have realy been the light in a very bleak

darkness, and can only say in just 5 short months have managed with their unstinting and also courageous

( I found few were willing to take on the big boys ) help, I can draw a line under this torture.

Please don't think I feel smug in any way, I found from all the comments that there are just so many going

through the same torture, but if you can find the right sort of help, I sincerely wish the same result for anyone

feeling it's never going to end, and everything is lost. Hang in there, good luck and thankyou.

Would it be possible for you to give a brief history of your case and where the property was.  I am currently thinking of employing Maria but worrying that i might just be throwing more money away.

Thanks

We purchased on Duqessa Fairways in 2004.no bank guarantee,and the developer has gone under bankruptcy protection.he offered us our money back in 4 cheques,then he was under the care of the courts,and ,we are now fighting all the way.