Bancaja to refund deposits paid by the buyers of AUGIMAR for the developments torresblancas, forum y barlovento

 Bancaja signed with Augimar a Generic Guarantee in which the Bank commited to provide an individual guarantee to every purcahser of the developments Torresblancas, Forum and Barlovento. So any buyer who bought in one of those developments and who hasn't complete the property is entitled to claim the refund of the deposit plus legal interest to Bancaja, even without holding an individual guarantee.

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In practice how will this work? And to what timescale? Is the Bank likely to appeal or have they agreed to the principal of refund?

Is there any suggestion that this will be fast tracked through the courts?

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 Under the provisions of the Generic Guarantee, the Bank was supossed to provide an individual guarantee to every purchasers, because before signing the document the Banks always analyze the circumstances of the developments, so when they sing the generic guarantee contract are completely aware of the risk they are assuming.

The type of proceeding depends on the amount claimed, but as long as it is higher than 6,000 €, the appropriate proceeding is the ordinary, which has two phases: a Prior Hearing (for the evidences’ proposal) and the trial. The time scale depends basically on the competent court (some Courts are really quick, but others aren’t).

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Thanks Guadalupe.

Are the Banks likely to appeal these generic BG cases?

Do you have any successful cases relating to generic BG's to date where actual monies have been returned to the purchaser?

 

This message was last edited by ads on 21/07/2011.

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Hello Guadalupe

I have been reading with interest your various postings over the past few months with regards to 'Generic Bank Guarantees' and I agree with your general opinion regarding this issue.

I am very pleased that you are as determined as I am to make the Banks accept their obigations and liabilites under LEY 57/68.

Once a Bank has signed a Generic Bank Guarantee with a developer and begins accepting the off-plan deposits then that bank does not have a right to arbitarily (randomly, subjectively, illogically, capriciously) decide which purchasers receive an individual Bank Guarantee.

This is certainly of great importance to all those thousands of buyers on various developments who never received an individual Bank Guarantee for their off-plan deposits.

For example on our Las Higuericas Finca Parcs development the funding bank, Caja de Ahorros del Mediterráneo, gave a certificate to the developer confirming that they would issue individual Bank Guarantees to every purchaser.  We know to our cost that CAM only issued around 70% of the individual BG's.  Around 30% of the purchasers, including myself, did not get an individual BG, despite the fact that CAM received the deposits in the same accounts into which purchasers who did get individual BG's paid.

Guadalupe, I have a couple of questions for you:

1.  Have you had a successful judgement for a purchaser who did not receive an individual BG on any development where there was a 'Generic Bank Guarantee' in place?

2.  If the answer to question 1 is yes - then did the Bank appeal - or have you successfully executed that first instance court judgement and received a full refund for the purchaser?

3.  For a purchaser to make a claim against the Bank who issued a 'Generic Bank Guarantee' - in your opinion does the purchaser have to provide evidence to show that their deposit funds were actually paid into the developers accounts at the bank who issued the Generic Bank Guarantee?

My reason for question 3 is because I know from experience that on many developments purchasers did not always pay their deposits directly to the developers bank accounts.  Many purchasers actually paid their deposits to Agents or Lawyers (who are now untraceable) and it is not always possible to prove with documentary evidence that those funds were actually fowarded to the developers bank account at the bank who issued the Generic Bank Guarantee.

Kind regards

Keith
 

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  Dear Keith,

I represented two clients who filed a claim against a Bank under the provisions of a Generic Guarantee, but there was no sentence because just before the trial the Bank offered an out of court settlement to my clients, who decided to take it. So I can't provide you any sentence about it. But I am currently dealing with several generic guarantees' cases, so as soon as a sentence is issued, I will report it to everybody in the forum.

There are several sentences from Magistrates' courts about generic guarantees anyway. On those rulings Banks are sentenced to refund the deposit to buyers who did not hold an individual bank guarantee.

Regarding the 3rd question, my opinion is that money should have been paid to the builder, or to someone expressly authorised by the builder to get it (Agents). It is not relevant if the account into which the deposit is paid is openned in the same bank who signed with the builder the generic guarantee or in a different one, because the Spanish High Court has sentenced several times that to make sure that money is paid into the "special account" is not the buyer's duty, it's the builders duty, and the Bank who who has signed a generic guarantee should control it.

Just think about something: when a generic guarantee is signed, some purchasers receive an individual guarantee, but the majority don't. But some of the lucky buyers who have it, did not pay the deposit into the "special account" or even pay it to other Bank. But the bank guarantee is given to them anyway.

So when the bank face the claim under the provisions of the generic guarantee, to use the lack of payment into the special account as a reason to be opposite to the claim is a bad argument, as long as that Bank provided before individual guarantees to buyers whose deposit wasn't pay into the special account or even were paid to other Banks.

In other cases, the generic guarantee is signed after the signature of the purchase contracts and the payment of the deposits. So when Bank signs, assume the risk of the development and the consequences...

 

Hope it helps!!

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Dear Guadalupe

Thank you for your comprehensive reply.

Just out of interest which Bank was it that offered the out of court settlement to your clients?

Regarding the account into which the deposit money is paid, yes it is true that there is Case Law in which the Judge clearly states that it is not the responsibility of the buyer to ensure that the funds are paid to the Cuenta Especial.  The Judge says that it is the Banks responsibility to ensure all the deposit funds are held in the Cuenta Especial in accordance with LEY 57/68.  Furthermore the Judge states that the Bank must be vigilent and must monitor the developers business closely.

It happened at Finca Parcs that some buyers paid to a UK agent who went Bankrupt and did not pay all the deposit money to the developer.  But some of those buyers got Bank Guarantees from CAM even though CAM did not receive the deposit money.  But many of us who did pay our deposits directly to the CAM accounts did not get Bank Guarantees!

Guadalupe - I very much agree with all your comments and your opinions.  BUT......and it is a big BUT.....I am very nervous about the Spanish Courts and the Judges.  Many Judges seem to have a very poor understanding of LEY 57/68 and tend to favour the Banks & Developers.  There seems to be a great inconsistency in the Judgements over the past few years regarding Bank Guarantees. 

And....the Banks are very clever at using delaying tactics, appeals etc, which just add to the unreasonable amount of time it takes for even the simple Bank Guarantee cases to get through the court system.

Keep up the good work and keep fighting the banks!  They must be made to accept their responsibilites under LEY 57/68.

Kind regards

Keith

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Guadalupe,

May I ask another question also please.

If a purchaser has no individual BG, but a generic guarantee has been found for the development, and monies were paid to a law firm who subsequently forwarded the monies by cheque to the developer (instead of issuing a bank transfer) , is it necessary for the specific banking details to be identified (i.e. to identify where that cheque was encashed) for a bank claim to succeed? Or is it sufficient to demonstrate, via the contract detail, that a cheque was forwarded by the law firm to the developer? In other words Is it  imperative to the case that the purchaser obtain the specific details of where the law firm's cheque was encashed? Would the claim fail without this level of  detail?

Many thanks.

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 Dear Ads,

 

it is important to provide evidences that the payment was credited into a developer's bank account. Any bank can provide their customers with a certificate about the accoun'ts holder (and even Bank's name) in which the cheque has been credited. 

 

Regards,

 

Guadalupe

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Guadalupe,

Many thanks for that.

The problem comes when the law firm becomes obstructive to providing this information,  (since the purchaser is not allowed to request this information from the law firm's bank, due to data protection). Presumably however, the law firm can be called to account by the judge, to provide this information at the court hearing, is this a correct assumption?

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Guadalupe/Ads

I've been reading this with great interest.  My position looks the same, as follows -

I paid 3Molinos £22K into Banco Valencia who issued a generic bank guarantee to me.  (Generic in the sense that it didn't contain details of amounts etc).

I subsequently paid the remainder of my deposit, £20K, into Banco Santander under the instruction of my Spanish solicitor.  I discovered in January 2010 that this money was not transferred to Valencia.

I paid my solicitor to invoke the guarantee and I've subsequently obtained the £22K under bank guarantee but Valencia refuse to honour the remaining £20K.

My solicitor wants more money from me to sue Valencia.

My contention is that my solicitor should have ensured, as they said they would when I engaged them, that all my money was in the correct account covered by the bank guarantee.  I consider this negligent on their part and refuse to give them more money.

I'd be grateful for any advise on what I should do next.

Peter

 

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Hi Peter,

I really dont understand why your solicitor just claimed part of the deposit, because under the provisions of a generic guarantee and the law 57/68 the bank is responsible for the whole deposit, no matter the account the deposits were paid into, because when the bank signs the generic guarantee assumes the risk of the development, as long as knows (or could know) its circunstances. Both banks, Santander and Valencia, signed a generic guaranteed with 3 Molinos anyway. Both are responsible then. I thing you should email me privately the details of your purchase because this posts can't be used for individual advice.

Regards,

GUADALUPE

This message was last edited by Guadalupe. Lawyer on 17/08/2011.

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