Top 5 Ways to Reclaim Money Owed To You Legally in Spain Part 1

1) Supreme Court Judgement Ruling to Refund Off-Plan Deposits

What is all the fuss in the press about the “Supreme Court Judgement on bank guarantees”?

There was a Supreme Court ruling 2015, telling banks to pay investors back the deposits they put down on homes sold off-plan because very simply, it was law by Spanish Law 57/1968 (Consumer protection law) that when off- plan deposits were paid into the builder or promoters banks, they should have been placed on a separate account and a bank guarantee issued by the developer to the buyer, backed by the funds in that account.

This was not happening and now the Supreme Court were found the Banks to be jointly liable with the builders and people can claim back the deposits they lost.

Thus if you paid stage payments on a property in Spain during the boom years but the property was never finished and the developer disappeared or went bankrupt, you have a very good chance of getting funds back.

Monte Puchol, Trampolin Hills, Fortuna Golf… all of these are cases, we are dealing with now that there is a precedent whereby people can claim, if certain conditions are met, from the Bank that received the funds related to a construction if a guarantee was not provided by the builder and people have lost their money.

With many of these builders, the Liquidator found that the developer had no money or assets to pay off their debts, and also that there had not been a guarantee or insurance policy securing the money paid to them, which was actually required by Spanish Law 57/1968.

Our clients may now have the option of either suing the Bank for not fulfilling the conditions of the law from 1968 or of suing the solicitor acting for them for negligence and misrepresentation, as they clearly did not do their job properly and act in a professional manner.

Nowadays, the law has changed in Spain and whereas 5 or 6 years ago maybe this option was not available, now a legal firm can be sued for malpractice and in fact has to have an indemnity insurance in place to protect them, in case they have made a mistake.

We know that there are many other people who have lost upwards of 50,000€ because of Monte Puchol and their associated solicitors, so if you were affected, please approach us as we may be able to help you.

What is needed to claim?

We would need copies of your documents to study if you have a good case; that is:

– purchase contract
– confirmations of amounts paid by credit card or bank transfers
– receipts of payments received by the property developers
– the initial total price of the property
– the correspondence (if applicable) between you and the property developers (and any other written communications that may be of use for the case)
– any copies of any Court documents

Having the contracts, copies of all payments, any correspondence with the legal firm, emails, is all very important. Any legal case needs proof and evidence but with this, we may be able to help you sue and recover all of your money and interest and costs.

Costs

We need to review individual situations but there may be an option of recovering an investment by paying the barrister fees and Court costs, or on a possible no win no fee basis.

2) Legal cases where No Deeds Of a Property Obtained

Our firm is fighting a landmark court case on behalf of Orihuela Costa residents who paid for their properties in full and never received the deeds because an illegal mortgage was taken on the property.

The Class Actions involve a number of people, we believe that hundred more are affected and are missing out on the opportunity to have the threat of repossession removed and the debt paid, returning their home to its rightful owners.

We have clients that for many years were unaware that the property developer they bought from and that built their house had taken out a large mortgage on the property. The clients had paid for the property in full but never received their deeds and it wasn’t until several years later they discovered the terrible reason why. According to the bank, the client was legally responsible for the debt and could not sell the property without the deeds. May clients face the threat of repossession.

The builder was able to take out these mortgages on the homes because all of the buyers had given power of attorney to a legal firm to act on their behalf. Over time it emerged that this law firm never signed for the properties at the Notary, therefore, the properties remained in the builder´s name, despite the fact that the buyers had paid in full.

The builder took out mortgages on the properties and then as the housing boom bubble burst a few years ago, went into liquidation. With the economic climate changing, the banks began pressing for repayment on the mortgages, eventually repossessing them in the hopes of either auctioning or reselling them.

The lawyer who acted for these clients in the purchase of their properties had a professional duty to take care of the client and ensure that all was present and correct before the final amount was paid for the property – and to ensure they got the deeds – so we now have two actions against the law firm and the estate agent. There was a definite link between the two businesses, with the estate agent promoting the legal firm as its preferred legal partner.

With a precedent in its favour for the same situation, our firm continues the Class Actions next year. We hope to see the mortgages cleared and the clients put back into the same position – physically and financially – as if nothing had happened when they bought their properties; the mortgages paid off and their legal costs covered by the law firm and/or the estate agent.
Anyone in a similar position is being advised to contact Amanda enquiries@spanishsolutions.net.
What is needed to claim?

We would need copies of your documents to study if you have a good case; that is:

– purchase contract
– confirmations of amounts paid by credit card or bank transfers
– receipts of payments received by the property developers
– the initial total price of the property
– the correspondence (if applicable) between you and the property developers (and any other written communications that may be of use for the case)
– any copies of any Court documents

Having the contracts, copies of all payments, any correspondence with the legal firm, emails, is all very important. Any legal case needs proof and evidence but with this, we may be able to help you sue and recover all of your money and interest and costs.
Some of these cases are being taken on, on a No Win No Fee basis. Others clients are able to pay for in stage payments and a full explanation of costs will be given prior to going ahead.

3) Mortgage Floor Clause and Expenses Reclaims

The European Court of Justice ruled over the New Year on Mortgage Floor Clauses, which are the clauses put in a mortgage deed by some banks, which basically meant that when interest rates went down the bank retained a minimum floor clause, so customers paid more to the bank.

They are being seen as “abusive clauses” against the benefit of customers, and banks will be penalised by having to pay back the client everything they overpaid as a result of this.

There are 2 different issues:

1º) Bottom clauses.

These have been declared illegal by the European Courts. Therefore, clients can force the bank to erase this clause and moreover recover all the money paid as a consequence of the execution of the bottom clause. This is very clear and a huge opportunity for clients to recover money.

2º) Expenses for setting up the mortgage.

When you set up a mortgage in Spain you have to pay all the expenses (notary fees, land registry fees, stamp duty, etc). The Supreme Court has decided that this is an abusive clause as the beneficiary of the mortgage is the bank.

The banks are not forced to negotiate with clients for this. The European Courts have not ruled yet, only the Supreme Courts in Spain.

We are no longer dealing with these claims as clients can go directly to the banks.

We are aware Bankia announced its plans to refund charges to all of its mortgage holders and have set up a streamlined process allowing affected clients to apply for refunds as of Friday, February 3. The bank said it has put aside €200 million to cover the cost of the refunds.
In a statement, the lender said customers would only have to visit a branch of the bank to start the refund process. Clients will have the option of having the money paid into their account immediately or seeing the sum wiped from their mortgage obligations.

4) Plusvalia Tax Reclaims

This is the most recent of possible reclaims and follows a Judgement of February 16th, 2017, when the Supreme Tribunal in Spain considered two articles of the law to be unfair (how the town halls calculate this tax) and so there is a possibility of claiming the tax from a surplus value paid when a property has been sold at the price lower than the price on the deeds of the purchase from the local town halls.

At the moment, this sentence is very new and it does not mean that plusvalia does not have to be paid, nor that you can definitely recover the money paid, but the town halls must change their systems to make it fairer.

The basic premise is that if no capital gain was made on the sale, then why should the town hall get a higher plusvalia figure than on buying (as plusvalia is a tax on the change of the value of land from when buying to when transferred on), thus it will be necessary to reclaim from the town hall the undue difference.

In the Orihuela Costa, this amount of tax is so low that is not worth it economically paying to make a claim, but in Murcia region, Pilar de la Horadada, and Torrevieja the amount can be very different.

We are looking at the steps with regard to these claims, but if you have sold at a loss and paid a large amount of plusvalia tax, it is worth registering your interest with us. enquiries@spanishsolutions.net