BG and The Lawyers Responsibility

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Thanks again!

I presume then that you have to go to court first before yes, and fail in obtaining the refund and the, once the damage is clear:   you can follow any compensation legal route against the Bank or lawyer's insurance company?

Would this compensation potentially cover the full original deposit and/or interest? yes, it would.

I am slightly confused Maria - your earleir post said this:

"Can you only follow this legal route if you have been through the courts already and won your case against the developer for breach of contract, or is this legal route totally independant of this requirement? It is totally independent."

But your last post said:

"I presume then that you have to go to court first before yes, and fail in obtaining the refund and the, once the damage is clear:   you can follow any compensation legal route against the Bank or lawyer's insurance company?"

These 2 posts seam to be conflicting to me.

Yes, you need a failed action against the developer before asking for compensation against the Bank. I whould have said dfifferent actions instead of independent actions.

Maria- Would this failed action include losing a court case for breach of contract against the developer?

Yes, it does.

Maria

Maria,

Please could you advise on the following:

If the purchase contract makes no mention of a special account  relating to the deposit paid by the purchaser, where does the purchaser stand in legal terms? Is the lawyer ultimately responsible for ensuring that these details are mentioned in the contract and could there be a case for compensation against the lawyer's insurance company if monies via an enforcement process are never recouped in the event that the developer goes into administration?

How would you go about finding out where the deposited monies have been placed, in order to seize liquid assets under the enforcement process, if there is no mention of a special account on the contract? How can you identify and prove if monies have been paid directly into the developer's Bank account (which we assume is illegal according to law 57/68)?

Also, if no liquid assets are found and seizure of properties comes into action, whereby a cost of registration, expert valuation and auction of the property becomes necessary, is this cost to be met by the purchaser in the interim? If so, can these extra overheads be recouped from the auction together with the amounts owed from the previous successful judgement made against the developer for breach of contract.

Can the purchaser request their own independent expert valuation to ensure that all of these monies are realisitcally recoverable from the property asset, and how do you go about ensuring that all the monies are recouped in this process?

This message was last edited by ads on 27/11/2009.

According to the public nature of Law 57/68, those deposits are assumed to have been paid in a special account by developer and liability out of 1.2 of ley 57/68 is compulsory.

If Banks exercised all the due diligence for the special account and Guarantees to be issued and failed ( out of their due diligence), then they would have no liability out of the said provision.

Thanks Maria.

So what action would you recommend the purchaser follow if the enforcement process against the developer has already been instigated? Should this legal route be continued in the hope that monies will be recovered through this long winded and costly enforcement process, or are you advocating that this is unnecessary and an alternative legal route against the bank/developer should be followed instead?

The two can be used at the same time.

Best,

Maria

When you say the two can be used at the same time, do you mean that this becomes part of the enforcement process or will this incur more additional legal costs?

well, that really depends on your lawyer. It is a independent-different action.

Best,

Maria

Many thanks Maria. This is much appreciated.

One last question (sorry !), if you were starting afresh on a legal case like this, would you suggest that the bank/developer compensation legal route is the best way for swifter recovery of monies, or would you suggest both enforcement and compensation routes should be followed anyway?

I would follow both of them simultaneously at present moment and wil wait to see how Judges react to this action.