Law 57/68 claims

Do you think there are still off plan purchasers who have no started a claim against Banks?

Herer's some resasons that may have contributed to inhibiting taking legal action, Maria. Hope this helps.

Can't afford litigation since loss of life savings.

Wrong legal advice in early years from non independent lawyers.

Fear of losing case without comprehensive SC doctrine in place to support all articles of Ley 57/68 (hence waiting to maximise chance of success).

Fear of not recovering costs/interest to make litigation worthwhile.

Proliferation of Bank appeals and negative impact on timeframes to achieving actual return of monies.

Ongoing inconsistencies of judicial rulings.

Lack of info/proof re where deposited monies were transferred and obstructive behaviour by Banks/non independent lawyers, leading to dissillusionment and distrust.

Lack of accountability by Bar Associations to regulate their members (distrust)..

Failure by Bank of Spain to regulate their Banks.

Psycological stress and ongoing financial costs from lengthy litigation.

Perception that Banks are "all too powerful" and have resources to use all ploys at their disposal to counter  and delay enforcement of existing law.

Fear of protectionism of Banks and conflict of interests.

Disillusionment by lack of support from EU re enforcement of property rights in Spain.

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M

It's for all of those reasons I identified why it's important that the judiciary and Supreme Court should not impose time constraints on offplan purchasers' continuing ability to reclaim their rightful return of monies according to all articles of Ley 57/68, when circumstances allow them to do so.

Have the SC already ruled on a time constraint to effect their rights, Maria? In which case has this been contested?

Surely due consideration must be given, especially when lack of time constraints have not been equally enforced to ensure timely justice (which in turn leads to consolidated case Law in favour of buyers).

Inalienable rights presumably are not constrained by time? Is this correct Maria?

Supreme Court has established a 15 years deadline for this type of actions.

Maria

costaluzlawyers

saferent

takelegal

wemovetospain

Ads, thank you for your very clear and in my opinion correct appraisal of the legal system that is in serious need of intervention by the Spanish Government and / or Spanish legal system. Until that intervention takes place then this saga will drag on and on. 

I am in the Spanish legal " Queue " like many others wanting and waiting for justice to be delivered. I've been waiting over three years since our first instance hearing at Alicante which was deferred at the request of the bank and we still  await  to be heard at Alicante. Yes the legal system and courts are busy. But three years, come on !!

Or is it a way for justification of upfront legal fees ?  I make no apology for cynicism.

Even  those people who have won cases are having to wait long periods of time for appeals just because the bank can lodge an appeal. It's like the banks lawer looks out of the court window and tells the judge that the sky outside is green. The judge looks out the same window and declares they sky is in fact blue. But the bank say we will llodge an appeal and so it goes on.

So far it's been a joke.

Rant over...

Hi guys

I did win my deposit back after years of courtroom dramas.

As to the costs, I paid a small retainer which was great.

However after the event, I lost my claim for costs which I couldn't appeal. The upshot being I paid all awarded interest (12k euro) in costs.

I have seen since that most people do get the costs back from the banks.

It just goes to show even though all the cases are pretty much the same , the outcomes can be different.

V Frustrating

cheers

I would like to see consistent reporting back from lawyers as to what reasons are being given by the judiciary in all these cases that fail to gain award of costs, so that we can gain transparency and see if a regional/ court / judicial pattern is developing in this regard.

 Might this be down to the way certain legal arguments are being presented, or due to no SC ruling on this matter, in which case if you can't appeal, how are innocent claimants  ever going to gain SC doctrine in this regard and make Banks FULLY ACCOUNTABLE?  

 If you FINALLY win the lawsuit after all the "standardised attempts " by the Banks to appeal (not to mention the stress and financial implications from ongoing appeals) and you subsequently WIN,  why on earth should innocent claimants suffer the consequences of any award of interest being " wiped out" by the failure to gain award of costs to the benefit of Banks who are appealing as standard practice, when case law against Banks is growing and growing? 

This appears to be a pattern of events that without doubt is working in Banks favour, does nothing to disincentivise Bank's from appealing in this fashion without due regard to GROWING CASE LAW, and is becoming of increasing concern to those fighting for justice against the Banks. 

It's time this was taken seriously by law firms and time this was adequately reported back if they are as concerned as their clients by a system of justice that is failing to make Banks FULLY accountable for Banks' gross negligences during this last decade.

 Where is the collective and loud call by litigators in defence of their clients best interests for the judiciary to demonstrate moral authority when making their rulings, and recognise the need for awarding costs (and interest), GIVEN GROWING CASE LAW, to act as adequate deterrent to the standardised methods being employed by Banks who are certainly not acting in good faith and who are doing all in their power to be obstructive in this system of justice?

This message was last edited by ads on 04/02/2016.

This message was last edited by ads on 04/02/2016.

We will report here on reasons for lack of award of costs, if they come.

it may be thats its just easier to take the costs from us instead of chasing the banks "again" for further payments owed.

Trowell:

Cost and interests are chased at the same time. Always. Regardless there is costs award or not, for lawyers work is the same

Thank you Maria.

To your knowledge are your litigators, when fighting for award of costs in response to Bank appeals, highlighting the growing requirement for moral authority/ adequate disincentive against obstructive behaviour based upon growing case law/ proliferation of Bank appeals/ negative financial impact and diminishing effect on subsequent award of interest/ lack of good faith etc within their legal arguments, to ensure that, upon winning the case against the Bank, award of costs should be the default and not vice versa?

Each Bank Action (LEY 57/1968) Lawsuit would normally include a claim for Principal, Interest & Costs.

It is up the Judge (in First Instance Court) or 3 Magistrates (in Provincial Appeal Court) to decide:

1.  The outcome of the case

2.  If interest is awarded and if so, from which date - date of payment to the developer, date of filing of the Lawsuit or sometimes from the date of the Sentence

3.  If costs are to be imposed on any one party

With regards to the issue of costs in the Spanish Courts (I will try to keep it as simple as possible):

In cases where the subject of litigation is very clear according to Case Law then legal costs are normally imposed on the losing party.

However, in cases where the subject of litigation is doubtful or where there is conflicting case law then costs are not normally imposed on any one party.  So each party will pay its own costs.

LEY 57/1968 cases are not always clear.  Each case is judged according to the evidence available.  There is some case law in favour of banks and that is why sometimes Judges do not impose costs on the losing party.

In cases that are won in full but costs are not imposed on any one party, the Judge will normally state something like this in the Sentence:

“In accordance with article 394 of the LEC (Spanish civil procedure act) and since in this area of law there are serious doubts expressed in contradictory case law cited by the parties, it unnecessary to impose costs on either party”

Article 394 of the LEC (Spanish civil procedure act) states:

Orders to pay costs in the first instance.

1. In declaratory proceedings, the costs in the first instance shall be imposed on the party who has had his pleas rejected unless the court considers and reasons that the case may pose serious de facto or de iure doubts.
For the purposes of ordering a party to pay costs, in order to verify that the case is legally doubtful, the jurisprudence of similar cases shall be taken into account.

If the Lawsuit is only partially upheld then each party will pay its own costs.  This can happen for many reasons, but I will give an example:

A buyer paid lets say 100,000€ total deposit to the developer.  3,000€ may have been paid to an agent as a deposit and then 97,000€ was paid direct to the developers bank account.  In the Lawsuit the whole 100,000€ is claimed from the developers bank, but during the course of the trial evidence is presented by the bank to show that in fact they did not receive the 3,000€ and that this amount was paid to a different bank.  Therefore the Judge will uphold the Lawsuit for the 97,000€ only.  This is a partial upholding of the Lawsuit.

In relation to the partial upholding of a Lawsuit, Article 394 of the LEC states:

2. If the upholding or dismissal of the pleas is partial, each party shall pay the costs involved in his proceedings and the common costs shall be shared equally, unless there are reasons to impose the costs on one of these as he litigated recklessly.

No two cases are identical, there are different claimants, different amounts, different evidence, different Lawyers, different Barristers, different Courts, different Judges etc...  And if the buyers are called to appear at the trial there will be different things said in front of the Judge.  So it is important to remember that there is no 'one size fits all solution'.

LEY 57/1968 is a still a complex issue for which case law is always evolving, albeit with more and more case law in favour of the consumer.

It is important in LEY 57/1968 cases against developer’s banks to (amongst other things) prove that the Bank:

1.  Knew the business activity of the developer

2.  Accepted the deposit into the developer's account knowing that the funds were for an off-plan purchase

3.  Maybe issued individual guarantees to other buyers on the same development

4.  Maybe financed the developer in some way - mortgages, loans etc

5.  Failed to control the funds in the Special Account

6.  Failed to ensure the funds were paid into a Special Account

7.  Failed to issue or verify the existence of the corresponding individual guarantees for the buyer’s funds it was holding in the developer’s accounts

Law is not ‘black & white’.

Each Judge will apply the Law according to the evidence and arguments presented in each case.

Whatever decision a Judge comes to they must substantiate and support their decision with explanations & references to case law supporting their interpretation and application of the Law.

But remember that all aspects of the case including the awarding of interest & costs can be appealed to the Provincial Appeal Court and then if necessary to the Supreme Court, if your Lawyer believes that there are very good arguments to do so.

Thank you for your reply Keith and for the detailed clarification.

Has there been any Supreme Court doctrine to clarify that interest should be back dated to the date that monies were deposited into developer account(s)? If not,why should awarding of interest be based on any lower amount which works to the Banks' advantage, when it is the Banks who were negligent from the outset, by failing to secure deposited monies in this regard? Isn't this a strong moral argument that should be brought to the judge's attention?

In your estimation, if all offplan deposits are proven to have been paid to.developer accounts even if held in different Banks, does this mean the judge should uphold the full amounts (no partial upholding of the lawsuit) and therefore award costs (as well as interest)?

even if a small % of the original payments were given to another party, it seems crazy that because of this costs of 10s thousands of costs dont need to be awarded.

I thought if you won any case, you would get costs paid because of the positive outcome, it just doesn't make sense!

Many thanks, Keith, for all your hard work and ongoing help with this insanity!

it does sound like the courts are saying that the banks are in the wrong.  this is proved when the court awards refunds of deposits. so why are some purchasers not being awarded all costs?  taking the banks to court is the only way that those of us without an individual bank guarantee can be refunded; and that's only because the banks aren't honoring their own general guarantee!  even if we accept that we are in a grey area of law, the circumstances should make it a simple decision for the courts to make. our only recourse to ensure Spanish law is applied is by taking the banks to court.  we had no other choice.

Surely where all deposited monies have been proven to have been deposited into developer accounts, and where  developer breach has also been proven, but developer became insolvent, then no matter into which Bank monies were deposited, the law in place at time of signing of contract, a law intended to have in place all necessary administrative processes required to protect all offplan deposited monies from the outset should be fully adhered to?

A General Guarantor (Bank or Insurance company) for that developer should be made FULLY accountable for return of principal, interest (back dated from date deposit was made) and full costs for ALL legal actions leading to return of monies, otherwise it makes a mockery of a Generic Bank Guarantee, especially where that General Guarantor was named in the original purchase contract?

We should never lose sight of the bigger picture here and question how can there be grey areas when the law identifies that Bank Guarantees must be made available (and honoured) together with provision of secure accounts for all offplan deposits? .And where this has not been adhered to then Banks are surely in breach of the law.

Bank Guarantees were heavily marketed as full security for offplan purchaser's deposited monies from the outset implying that monies were completely secure in the event of developer breach, and a law with defined legal responsibilities to establish secure accounts and provision of LEGAL guarantees for all offplan monies for any given developer was also in existence. So how Banks can continue to submit appeal after appeal given these heavily marketed securities in place to protect offplan purchasers deposited monies, let alone the growing instance of successful rulings that have taken a decade to achieve, is beyond many peoples' comprehension.

I have to ask the question therefore, what can be doubtful about Banks not adhering to their legal repsonsibilities to have all processes in place to secure all offplan deposited monies from the outset for any given developer when the law dictates that they do so???

Its just bollocks

Asking Ads Question below in bold green:

Question: I have to ask the question therefore, what can be doubtful about Banks not adhering to their legal repsonsibilities to have all processes in place to secure all offplan deposited monies from the outset for any given developer when the law dictates that they do so???

Answer: It will be  on the Bank the  burden of the proof to demonstrate he was not able to know that these amounts were for an off plan project.

So if the Generic Bank was named in the contract as guarantor, there would be no excuse for not making provision for secure account for all offplan deposits for that developer would there Maria?