Supreme Court Rules in Favour of Off-Plan Buyers

The Supreme Court has found in favour of several purchasers who were attracted by the purchase of off-plan properties. One of those affected, a couple from the south of England bought into a residential complex in Alicante. The complex was to include golf, apartments, hotels and shops. At the end only the apartments were built. “The rest were false” they commented to the media. This particular case was won due to misleading advertising. The problem was that the promoters disappeared from the map. Many of these companies had become insolvent or declared bankruptcy. The majority of British buyers had given up on the case until they contacted our law firm. Now the UK resident has recovered the money paid plus interest.

The case is common amongst the foreign purchaser who is in the majority the affected parties. This situation affects hundreds of thousands, most have not come forward as yet. The majority when discovered that the promoters had gone bankrupt, believed that they had no hope of recouping their money. We know that this is not the case.

It was during the boom years from around the ear 2000 when the ‘modus operandi’ intensified and become the financial instrument in that the banks were backing the purchase plots of land to sell properties not as gets built and usually with the legal licences not in place sell the un-built properties.

Promoters were required to lodge the payments into a special account or secure them through a bank guarantee or insurance policy. The banks receiving the money claimed that; “under their responsibility” that the amounts were guaranteed. The expression “under their responsibility” is what has allowed us to take action.

Our law firm has been advocating for clients since 2012. Our success rate with the banks has risen to 99%. We have won more than 100 lawsuits. All financial institutions have been affected in some way or another with the Banco Popular being the most prejudiced.

The jurisprudence of the Supreme Court has enforced the sentences handed down last year insisting on the refund of the amounts plus legal interest. For example, if a buyer paid 50,000 euros in 2003, today he would receive 50,000 euros plus 25.000 euros in interest. One of the plaintiffs has received 240.000 plus interest.

Banco Andalucia and Banco Pastor are the banks which have been the hardest hit by the recent judgements of the Supreme Courts.
Also affected are; ‘El Monte’ (now part of La Caixa), the former ‘CAM’ and ‘Caixanova’.

The sentences abound in joint liability between the bank and the developer. We will talk to promoters of small municipalities that have entered bankruptcy.

“Those who initiate a lawsuit against banks will find that these financial entities are obligated to give back what you paid plus statutory default interest”. The Supreme Court states that the consumer has 15 years to claim the guarantee. The consumer can claim amounts paid in plus the interest.

The big advantage for our clients is that they do not have to advance a single euro for litigation and pay at the end of the process from the amount recovered.

For further information or a free consultancy, please contact CAB Spain at:
myra@citizensadvice.org.es

Note* First published in 2015 and lost due to server collapse.

Please note: The information provided is based upon our understanding of current legislation. It is not legal advice but is provided freely to enable you to be properly informed. We recommend that if you are considering taking action, you should seek professional advice.