10 Apr 2018 10:14 AM:

BANKINTER (formerly Banco Intercontinental Espanol) was sentenced to refund the full off plan deposit paid by the buyer plus interest from the date the amounts were paid to the Corvera bank account.

Costs of the First Instance procedure were imposed on the defendant bank.

Interesting statements from the Judge in the Sentence were:

“The Bank is in rebellion as it did not file a defence to the Lawsuit.

The plaintiffs claim the sum of xxx,xxx€ paid for a house due to be constructed by the developer in the promotion ‘Corvera Golf & Country Club’. 

As the developer failed to construct the housing on time according to the Purchase Contract the plaintiffs originally filed a Lawsuit against the developer for judicial resolution of the purchase contract.  The case against Corvera was lost in the First Instance Court, however following an Appeal the Provincial Appeal Court revoked the First Instance Sentence and upheld the claims of the plaintiff.  The Sentence terminated the Purchase Contract and condemned the developer to the repayment of the amounts paid on account.  Corvera never paid.  The Sentence also refers to the Guarantee issued by the defendant bank.

The Guarantee contains an expiry date of May 2009 and a limit on the amount of interest.  These limitations are not valid.

Having been duly demonstrated that the defendant bank endorsed Corvera Golf & Country Club SL for the sum claimed and that the beneficiaries of the Guarantee are the plaintiffs in this Lawsuit, the claim must be upheld in full”

 

Thread: 9 cases won so far in 2018 by CostaluzLawyers

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15 Jan 2018 5:58 PM:

Hi Ads

Answers in bold:

I wonder if you could please clarify the following somewhat complex queries with regard to interest payments (Ley 57/68).

When a case against the Bank has been won at first instance level with award of costs and interest backdated only to date of claim against the Bank, and the Bank does not challenge this ruling within the 20 day period, but the claimant then appeals for additional interest (as per the original lawsuit), do they risk losing the costs and interest originally awarded as per the unopposed first instance ruling as a fallback position,if they subsequently lost the appeal for addtional interest?  NO

In other words do the costs associated with the appeal for additional interest remain separate from the costs relating to the unopposed first instance win?  YES

Who pays for costs if the appeal for additional interest is won? Is this split between the two parties so each pay their own costs? YES.  If an Appeal is won then costs will not be imposed on any party.  Each party will pay its own costs for the Appeal.  If an Appeal is lost then it is likely that Appeal costs would be imposed on the losing party.

Likewise, will the claimant be responsible for costs of both parties relating to the appeal for additional interest if they lose the appeal?  Possibly, yes.  That is up to the Magistrates to decide.

When a final ruling on interest has been achieved, do the Bank have the right to continue querying the costs as per the final ruling?  The Bank can challange the costs calculations, but ultimately it will be the Judge that sets the exact amount of costs that can be recovered.

 

This message was last edited by Keith110 on 15/01/2018.

This message was last edited by Keith110 on 15/01/2018.
Thread: Question for Maria on interest payments (Ley 57/68)

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05 Jan 2017 10:49 PM:

CORVERA GOLF & COUNTRY CLUB GOES INTO ADMINISTRATION

LEY 57/1968 – RESPONSIBILITY OF THE FINANCIAL INSTITUTION – BANK OR INSURER

On 16 December, the Mercantile Court Number One of Murcia declared, at the request of creditors represented by the Costaluz Lawyers & DeCastro legal teams, the insolvency and administration of Corvera Golf & Country Club SL, and the assets of this company are now suspended.

The administration of Corvera will give greater clarity for claims against banks that accepted buyer’s off-plan deposit amounts for properties at Corvera and also against the guarantor banks or insurance companies.  

Claims due to delay in delivery of the properties can be directed against the Banks in the light of recent important Supreme Court Sentences that are declaring, with forcefulness, the responsibility of the developer’s Banks as guardians of the security of those deposits in off-plan purchases.

This responsibility is given in two different scenarios, both confirmed by the jurisprudence of the Supreme Court according to Spanish Law, LEY 57/68: 

(1) Liability of the financial institution that receives amounts paid by off-plan buyers into an account opened by the real estate developer, if the property is not completed on time.  These banks are responsible, for the return of the off-plan deposits plus interest.

(2) Liability of the guarantors, even though individual guarantee documents have not been given to purchasers: the understanding of General Guarantee agreements signed between developers and insurers or banks has always been interpreted by the Supreme Court in favour of the buyer for the full amount paid to the developers bank account by the buyer irrespective of any arbitrary limit included in the General Guarantee.

Banks also responsible if there were urban irregularities

A recent Supreme Court ruling also holds off-plan property developer banks liable if the development is not completed due to urban irregularities. The reason for this strong protection to the purchaser of first and second residences is in the eminently protective nature of LEY 57/68, which gives rights to the buyer which are of an inalienable nature.

This jurisprudence contributes to the regeneration of the trust in second homes in Spain that was sadly eroded due to the unscrupulous behaviour of many of those involved in the last real estate and financial bubble.

Thread: Corvera entered receivership

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21 Dec 2016 4:40 PM:

COURT OF JUSTICE OF THE EUROPEAN UNION

PRESS RELEASE No. 144/16 - Luxembourg, 21 Dec 2016

CLAUSULA SUELO - MORTGAGE FLOOR CLAUSES

Spanish case-law placing a temporal limitation on the effects of the invalidity of ‘floor clauses’ included in mortgage loan contracts in Spain is incompatible with EU law

Such a limitation makes consumer protection incomplete and insufficient and is not an adequate and effective means for preventing the use of unfair terms

In Spain, many individuals have initiated judicial proceedings against financial institutions seeking a declaration that the ‘floor clauses’ inserted in mortgage loan agreements concluded with consumers are unfair and that, consequently, they are not binding on the consumers. The clauses in question provide that, even if the interest rate falls below a certain threshold (or ‘floor’) defined in the agreement, the consumer must continue to pay minimum interest equivalent to that threshold, without being able to benefit from a lower rate.

By judgment of 9 May 2013, the Tribunal Supremo (Supreme Court, Spain) held the ‘floor clauses’ to be unfair, given that the consumers had not been informed properly about the economic and legal burden which the contract would place upon them. Nevertheless, the Tribunal Supremo decided to limit the temporal effects of the declaration of invalidity of those clauses, so that they would have effect only for the future, as from the date of delivery of the abovementioned judgment.

Some of the consumers affected by the application of those clauses are asking for repayment of the sums they claim have been unduly paid to the financial institutions from the date on which their loan agreements were concluded. The matter having been brought before them, the Juzgado de lo Mercantil no 1 Granada (Commercial Court No 1, Granada, Spain) and the Audiencia Provincial de Alicante (Provincial High Court, Alicante, Spain) ask the Court of Justice whether the limitation of the effects of the declaration of invalidity from the date of delivery of the judgment of the Tribunal Supremo is compatible with the Directive on unfair terms, 1 given that, according to that directive, such clauses are not binding on consumers.

In today’s judgment, the Court holds that EU law precludes national case-law in accordance with which the restitutory effects connected with the invalidity of an unfair term are restricted to the amounts overpaid after the delivery of the decision holding that the term is unfair.

The court notes first that, according to the directive, unfair terms must not bind consumers as provided for under the national law of the Member States, with the obligation being on those States to provide adequate and effective means to prevent the use of unfair terms. The Court explains that the national court must purely and simply exclude the application of an unfair contract term in such a way that it is deemed never to have existed and so that it does not bind the consumer. The finding of unfairness must have the effect of restoring the consumer to the situation that consumer would have been in if that term had not existed. Consequently, the finding that ‘floor clauses’ are unfair must allow the restitution of advantages wrongly obtained by the seller or supplier to the consumer’s detriment.

According to the Court, the Tribunal Supremo was entitled to hold that its judgment was not, in the interests of legal certainty, to affect situations in which judgments with the force of res judicata had been given. EU law cannot require national courts to disapply domestic rules of procedure.

However, in the light of the fundamental requirement of a general and uniform application of EU law, it is for the Court and the Court alone to decide upon the temporal limitations to be placed on the interpretation it lays down in respect of an EU rule. In that context, the Court makes it clear that the provisions of national law must not adversely affect the consumer protection guaranteed by the directive.

As it is, the temporal limitation of the effects of the declaration of nullity in respect of ‘floor clauses’ deprives Spanish consumers who have concluded a mortgage loan contract before the date on which the judgment of the Tribunal Supremo is given of the right to obtain repayment in full of the amounts overpaid to the banks. Therefore, the effect of that temporal limitation is an incomplete and insufficient protection that cannot constitute an adequate or effective means of preventing the use of unfair terms, as required by the directive.

Thread: Your refund linked to Floor Clause in your spanish mortgage

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21 Dec 2016 4:38 PM:

Spain's banking sector was hammered on Wednesday after the European Court of Justice ruled that lenders will need to reimburse mortgage customers who were overcharged on interest payments.

The Spanish Supreme Court had previously ruled that the refunds should only apply from May 2013, however the ECJ has now ruled that all overcharged interest should be repaid, which in most cases will be from around 2009 when the Euribor began to fall.

The Court said lenders had incorrectly applied a 'floor' (Clausula Suelo) to mortgage rates, even as inter-banking lending costs fell to a record low of nearly zero percent in the wake of policy easing from the European Central Bank. The 'floor', which was ruled illegal by Spain's highest court in 2013, essentially meant that retail customers paid higher-than-necessary rates on their mortgages, potentially amounting to billions of euros, that lenders will now need to reimburse as a result of the ECJ ruling.

"The situation of unfairness must have the effect of restoring the consumer to the situation that consumer(s) would have been in if that term had not existed," the ECJ said "Consequently, the finding that 'floor clauses' are unfair must allow the restitution of advantages wrongly obtained by the seller or supplier to the consumer's detriment."

Thread: Your refund linked to Floor Clause in your spanish mortgage

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