Lagos de Santa María and Supreme Court

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05 Dec 2013 1:54 PM by mariadecastro Star rating in Algeciras (Cadiz). 9419 posts Send private message

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Legal tip 1076. Lagos de Santa Maria by the Supreme Court 
05 December 2013 @ 13:02 
 

Very recent Court Decission by the Supreme Court in regards of this conflictive development in Marbella. Los Lagos de Santa María. Third time the Supreme Court discusses on this in October 2013.

Supreme Court, following a doctrine they started last year ( 10th of September 2012), again, states that lack of First Occupation License is a cause for contract cancellation just in two cases:

1) If the lack of first Occupation license was expressly agreed as essential ( major breach) in the contract

or, in deffect of the above

2) In those cases where related circunstances tell that granting of First Occupation License will not come soon due to possible planning illegalities.

Developer will always be able to prove that the Lack of License is accesory ( minor) and not an essential ( major) breach if the lack of obtention of this is not related to " unpossibility to give to the unit the use it was built for" 

A reform/clarification of Law 57/68 seems necessary to me as all this doctrine seems to somehow contradict Law 57/68 and, specially provision 3 which clearly says:

"Article Three - Upon expiration of the period allowed if the construction and delivery of the 
dwelling has not taken place, the buyer may choose between the cancellatino of the contract  with repayment of the amounts paid in advance, plus the six percent annual interest, or give the developer extended time and this period must be stated in an annex to the contract awarded,  specifying the new period with the date of completion of construction and delivery of housing". 

I can understand that law 57/68 is possibly too general and that there should probably be a classification of breaches with corresponding consequences ( compensation/cancellation), but, being Law as it is at present, I find difficult to assumethat the Lack of First Occupation License will just grant cancellation rights to buyers if this has been expressly agreed in the contract or a Urban/Planning illegality is involved.

What about those cases where developer run out of funds or run away with them and development is not finished for years, where no Urban/Planning breach is involved?

 



_______________________

Maria L. de Castro, JD, MA

Lawyer

Director www.costaluzlawyers.es

El blog de Maria



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05 Dec 2013 2:16 PM by ads Star rating. 4134 posts Send private message

The rule of law is intended to protect consumers from abuse, and existing Spanish Law, Ley 57/68, is a good law which states in clear unequivocable language that the rights this gives to the purchaser are INALIENABLE AND CANNOT BE WAIVED, and that funds paid in advance are to be protected and refunded in the event that construction, completion and delivery of property does not take place for any reason by the agreed date as per the contract.

Inalienable...... unchallengeable, absolute, immutable, not able to be forfeited, unassailable, incontrovertible, indisputable, undeniable.

Does this latest decision now mean that inalienable rights are not being recognised in Spain and that those who gave consent to a purchase contract based on these inalienable rights being available as stipulated in law Ley 57/68, are now  being undermined and retrospectively removed?





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05 Dec 2013 2:34 PM by mariadecastro Star rating in Algeciras (Cadiz). 9419 posts Send private message

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Seems to me that these Supreme Court Decissions, as a matter of fact, make those 57/68 rights weaker.

Again, I can understand that there are different levels of breaches and that because of that different level of measures/ consequences need to arise but, from that to restrict lack of First Occupation License as breach of contract and cancellation producer, to just those two possibilities, seems to me too restrictive.

It might be that the Supreme Court is thinking of those  cases where whole construction is finished and end of works certificate is issued but there is not First Occupation License, then, in these cases, cancellation is possible just under those two frames. If this is the case, I guess a further explanation is necessary.

I keep wondering for those cases where developer has disappeared or is non solvent to finish the development. There are some of these that do not even go to bankruptcy proceedings and developments end up being repossessed by Banks. Where buyers rights go then?

In cases of bankruptcy, if the agreement of creditors is signed, buyers need to wait to the end of the Bankruptcy procedure, seeing their effective, inalienable rights related to Law 57/68 also highly disregarded. This is also my opinion.

There is much to work on in relation to Law 57/68.... it is not dificult. Just a bit of political will is necessary.

 


This message was last edited by mariadecastro on 05/12/2013.

_______________________

Maria L. de Castro, JD, MA

Lawyer

Director www.costaluzlawyers.es

El blog de Maria



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