By Nuria Pérez A LEGAL precedent has been established by the Supreme Court (TS) in Madrid for offplan property buyers with their ruling in the case of a couple who bought a property in 2005 at the failed Santa Ana del Monte development in Jumilla.
According to the couple’s lawyers, this enables off-plan property buyers to recover all deposits, regardless of whether they had signed an agreement with the builder during any voluntary suspension of payments.
Thanks to the judgment, the Santa Ana buyers will have around €50,000 refunded (their deposit plus interest) by the insurance company Sociedad de Garantía Recíproca de la Comunidad Valenciana. Lawyer Carlos Meoro from Murcia noted that first tier and provincial courts had originally taken a different view.
“Those buyers who had backed the voluntary suspension of payments and had signed an agreement with the builder were not able to recover their money through the bank guarantees, but that has changed for now,” he said.
According to Sr Meoro, around 1,500 property buyers at the Santa Ana del Monte development – most of them British – could now recover their deposits.
The important judgment was issued in July and complements another three rulings made earlier this year.
These back the right of off-plan property buyers to have all their deposits refunded – regardless of whether they had a bank guarantee or not – if their money was transferred into a builder’s specified bank account.
“The TS judges have ruled that this right should be guaranteed through law 57/68 instead of through the Spanish Civil Code and they have changed the interpretation of the law to benefit consumers,” Sr Meoro told CBNews.
“The precedent establishes that the legal bank guarantee is fully independent from the sales contract and any changes.”
However, Sr Meoro noted that law 57/68 law will be replaced in January by law 20/15, which will limit the rights established this year by the court precedents. His interpretation is that the new law will give more protection to the banks and insurance companies, at the cost of the consumer. This means that buyers will have to move fast if they want to take advantage of the current situation.