San Jose into liquidation.

Hi All,

I have just been told that yesterday San Jose went into liquidation.

I have mentioned this company before on here and aired my concerns.

This is the time when i hate being right........

 

I have just received information that the builder San Jose is going into liquidation

My understanding is they have filed for court protection from creditors (like Chapter 11 in US).

Quite a worrying time for buyers as I think most properties were sold without bank guarantees.

Will post any new information as and when I get it.

Justin

San Jose have applied for voluntary administration, on Friday. A judge will decide if they have enough assets to cover their creditors. Apparently this takes about 2/3 weeks ** EDITED - Disallowed website **

I have been told that they have enough assets but  it looks doubtful  that  development will go ahead.  I think there is some news on www.spanishpropertyinsight.com also.

 

This message was last edited by EOS Team on 5/13/2008.

My contact seems to think that they have little asset against debt ratio which will mean that there will be an awful amount of creditors in the queue.

i would say the banks will call in their finance first and the clients who had paid deposits will be way down the pecking order.

The implications on a wider scale are that a large amount of the larger agents that used to constantly stream up to Jumilla will fall along with the developer,they will all be owed commissions due on completions that now will never materialise,this in affect will be passed onto their clients......

The signs were there,Albatera denied licence,El Pinet denied lIcence,Jumilla issued part licence.

i feel for anyone caught up in this mess as the ripples caused by this will spread and spread...........

 

There are legal ways to  intervene in the bankruptcy process and protect off plan purchasers even if no bank guarantee is in place. It is a matter of specialists in Commercial Law and bankruptcy. Ask your lawyers to put imagination at work  as the buying rights themselves can play as guarantee somehow.

Hi

As I understand the property development company is Herrado del Tollo S.L. it is those who are not able to comply.  San Jose have 300 million behind them so they are infact asking for Suspension of Payments which for the moment means they are trying to avoid liquidation by reorganising the company, surely that is not the worst news just yet.

What I cant get my head around is we are being asked to get in touch with our Lawyers and so far I cant seem to get hold of ours.  It really saddens me.  I would like to think that San Jose can survive because I have heard nothing derogatory (dont know how to spell it) about them as a Company. 

Does anyone know if the only option is to go to court and get our money back or, are there any other options.

Christina

 

I made a solvency check  of that company yesterday and it seemed fine.
Let´s see if the Judge finally admit the bankruptcy application and if so, again, there are legal measures to be taken so you can protect your money even if you do not have a bank guarantee.

Best,

Maria

I may be coming across a little thick here, but how can San Jose be bankrupt, he has taken 50% off everyone for their property, not one single house has been built, so where has the money gone

Im moving to Spain month next and renting an apartment whilst I wait for my house to be built, the money we put down with San Jose was to start our new life

Hi Andy & Lynne

Same here. Where you supposed to be having a house built in Jumilla ?

Christina.

Yes we are were due to be completed Jan 2008, then July and the latest we were told is end of 2008

We have sold everything in the Uk and as of next month moving to Spain to await our property being built!!!!!

Dear Andy & Lynne

If you have a signed completion date for jan 2008, you do have a strong chance of recovering your deposit.

First of all, you do have your reason to ask for a reversal of the contract and, therefore, to recover your funds. This should include your expense of renting an apartment.

In a bankruptcy process, as you do not have a credit yet (until you have a Court sentence), you can file a claim to the same Court that works on the bankruptcy and, therefore, your credit will be inside the process as a "litigation credit".

This way you achieve defending your debt and also being part of the bankruptcy.

You probably are upset enough of your "dream purchase" but try to be positive and start action as soon as possible.

** EDITED - Spam **

Regards

Hi

We are in the same position as Andy & Lynne and it is very distressing.  We had a completion date for May 08. We sold a lovely home in the UK in the hope that this was going to be a happy adventure.  Our Lawyers are not very good, we now know it was a mistake to have a Lawyer that was recommended by the Agent. It is a horrible situation.  I have felt sick all day and dont know what to do.

Christina

For Maria De Castro

 

We have a Property Reservation Contract through Amba Sun International S.L. for completion in May 2008.

The Contrato De Compra De Vivienda / Purchase Sale Contract with San Jose / Herrada De Tollo S.L. also states the following:- The balance of the total agreed price, plus the applicable VAT, shall be paid upon the signature of the deed of sale and purchase, which is expected to take place in the month of May 2008.

As we are still in May 2008, does this mean we cannot file a claim against the them yet ?

If so, when do we file a claim.......beginning of June 2008 ?

Please advise as to our best course of action.

Barry

hi All,

It's a terrible situation, we are in the same position our completion date is May 08. We tried to pull out in the middle of last year SJ flatly refused to give us a refund and it seems we were able to do nothing about it. We have no BG either we were promised on several occasions that it was coming. We feel totally let down because like most people we made enquiries about SJ before we committed and as far as we knew they had an excellent reputation but looking at the problems they seemed to have had with other developments it seems I don't know where this reptuation came from!!!

there is a lawer in Manchester who is going to act on the behalf of many clients and put forward a list of names to the judge in the case. we have been added to the list but to be honest we don't know what else to do my Spanish lawer hasn't even come back to me and I phoned in a panic on Monday. she e-mailed saying she cant get hold of anyone at SJ office's!! So we have joined the other clients because we feel there is a better chance of getting our money back if action is taken collectively If anyone wants to know any details etc PM me and i will let you know the website etc.

 

Regards

 

Dear you all:

I think we need to first wait till the bankruptcy is approved by the Judge. Then, your buying rights on an asset  with full Work License can be used ( with proper use of Minor Court Case Law which back that defense) as a real guarantee. It is not a simple legal way ( not even stated in Law but just in Minor Court case Law) but it is very effective and accurate to protect rights of off plan purchasers when developer sgoing bankrupt. It is a way to avoid being considered as just a creditor out of many but as a creditor with a guarantee over the assets that you are buying.

It is not simple, but a lawyer with god expertise in Commercial Law and bankruptcies will be able to sort it out for you of course.

Barry, I have sent you a PM as it is better to keep the forums for questions and answers which may be of commun interest. I am pleased to answer to you through the PM facility.

 For you all: Do not worry too much, you have got  a problem but it is not unsolvable and not a disaster.

Best,

Maria

Thank you Mariadecastro,

Your advise is very very helpfull

Many thanks

Hi Maria

Do I understand correctly? That there is another way as in Minor Court case Law to achieve a better or same result.  Is this way likely to cost less?  I feel very reluctant to send good money after bad, although at this stage I feel there is no other option.

I am grateful to you for giving your time in this matter.

Linda Needham

Dear Linda:

You are correct. The properties you are/were buying can act as a real guarantee for your rights. You need to have a Commercial Law expert lawyer to do so.

Fight and you will get.

Maria

Hi Maria.  You are music to my ears.  I am so sorry to ask  another question?

 "Then, your buying rights on an asset  with full Work License can be used"

What is the definition of the above in law.  The properties at Jumilla have the foundations laid for the first phase.  The final licence to build upwards has not yet been granted due to, a part, of the land needed to build the golf course being expropriated and the necessary paperwork for the expropriation has not been finalised to the best of my knowledge.

Hi all

This is a very messy situation, placing trust in the developer has not worked, now placing trust in Spanish Law on bankruptcy, which we don't understand, is that going to work any better?

I feel completely helpless, let down and screwed.  The ability of a developer to sell properties that dont exist on land that has no licence, make millions and collapse.  It sounds like a fraud of both the developer and the regional government where everyone has shared out our money and dont give a damn about anything other than their greed.

In the UK if a builder goes bust there is a creditors meeting and an insolvency expert decides by appropriate manner, a dividend to creditors,usualy nothing because the residue is carved up and shared out.

In Spain?  It seems the cost of chasing the debt through the court could be around 7000 euro's and it will take around 2 years to be told nothing to come, at my worst guess.  I am reading some really awful news here and thinking that one way or another it is just going to cost a whole load more money, and get screwed all over again.

Awful situation, awful people.

 

Brian

 

Sterling

Our completion date is also May 08, when I spoke to Ambasun a couple of weeks ago I was told that in any case there is a 3 month period that is added onto the May 08 date (leeway for SJ just in case there was a problem) so SJ are apparently not in breach with us until Sep 08.

I didnt know whether you knew were aware of this.

Christina

Hi Christine,

I am aware of that clause but I think that by going into administration/liquidation and not building the promised development just maybe that is a 'breach of contract' after all ,it will still be the same situation in 3 months (or even worse) I'm sick of the whole thing, conflicitng advice, no news from SJ even my own solicitor hasn't been in touch. I told her the news about SJ!!!  You just don't know where to go or who to trust. Mariadecastro has given what seems to be excellent advice, but how do we find a lawer who specialises in minor court case law, a commercial lawer that deals with this sort of thing? I sent the link from this forum to my solicitor this morning and asked if she was able to act on my behalf of Shall I employ the services of another. It's seems whatever we do it's going to cost a lot of money, money we can't afford and for what seems to be a lost cause.

I don't mean to sound miserable but honestly that's how we, (all) feel I'ts so sad. SADM was going to be a fantastic place and I know there are people who have purchased 2 or 3 properties as investments, how much are these people going to lose. It's appalling.

 

 

Every case is different and thewy may have different solutions but even though you may think of making a group of clients in same development and similar circumnstances and fight out and in Courts ( if that became necessary) together. That will make the procedure less expensive.

I do not want to say that you do not have a problem, but want to direct the spirits towards fight and optimism more than towards devastatation  or hopelesness. A good legal defence can make wonders. Those are not empty words.

Reaction!

Maria

 

This message was last edited by mariadecastro on 5/14/2008.

Maria

We are employing your services, as you know, and i dont want to bring personal business into a forum area. 

I read  what you have just posted and ask you if the fees from here are to be more economical if you have a group of people taking up your offer of services?  If so do you wish to serve a group of people or individuals? 

In the UK we have a thing called a bankruptcy petition where the bankruptcy is brought by the creditor rather than the debtor being in control.

Is there is an option in Spain to do this and is it any good? 

I am wanting to establish if San Jose owns the land upon which the properties were sold, if its lawfull to sell properties without licence, how they managed to trade on these terms and perhaps if there is any liability with the banks.  Are they trading insolvently etc.  What standards are in place for trading, Spain is not a third world country.

In my case where the land (albatera) has no current development for the investors, is there any asset to secure on?

We are here at home in England and are absolutely sick to the stomach.  If they are solvent then they should be investigated for fraud, if insolvent then seize the assets. 

San Jose will lie and cheat and make things last as long as possible, as long as the situation favours them.  They will also dispose of assets and make further profits.

 

Has anyone had success transferring their deposit to another San Jose property like Playa Golf?  Our Jumilla property was due for completion in June '07 and in Mar '08 we requested a list of other key-ready properties through PSI.  They said that they would send it to us.  We have been chasing this list since then and even spoke to PSI again last week.  They didn't give us any idea that the liquidation was possible but still sounded enthusiastic to help us transfer to another property.  Now we know they were just stringing us along.  We feel they are completely incompetent - couldn't even get our name write on the email telling us that the development was going into receivorship.

Also, has anyone looked into the possibility of taking a claim against PSI?  Afterall, they should have ensured that their clients (the purchasers) were protected with a bank guarantee.  Correct me if I'm wrong but isn't a lawyer supposed to ensure that the law is followed?  I certainly won't be giving them the 2,000+ euro that they have asked for to pursue our case. 

Hi, this is the first time i have posted a reply and like everyone else am worried sick. We were purchasing at santa ana in phase one plot r-4  with a completion date of march 2007 .We also feel helpless and dont know which way to turn. We are reluctant to throw good money after bad and dont know who we can trust after trusting Amba sun and san Jose. Our solicitor is advising us to go straight over but to do what ? We have young kids and cant just go as well as the expence when we have just potentially lost thousands of pounds,what do we do ???????     san and kev

With respect to all.  Can I suggest that posts that do not ask direct questions of Maria be posted on the Residencial Santa Ana del Monte pages.  I really do not wish to be rude or upset anyone but it is so time consuming for Maria to read all the posts.  To get the best from her kind offers of advice would it not be better to use direct questions.

Hi, we also used ambasun and PSI and should have completed in june 07 at Jumilla, we find after numerous e-mails that we are getting little support from PSI i agree with the comments from cala that we have been poorly advised.

As we were informed on inspection trip byt Ambasun that they never use or take you to view properties/builders that do not have all paperwork in place, and that they use only repuitable builders.  Not the case

Why did PSI not provide information about San Jose aswe have found out from recent postings that this has been going on for years, surely they must do checks and they should be liable, why should we have to pay more money out to PSI

We are reluctant at the moment to proceed with PSI and does any one have any ideas who we could use or if we will receive a refund in full or are just wasting good money after bad as we do not have money to waste 

I am new to the forum having joined specifically because of what has happened and the helpful advice Maria has been providing We purchased a villa (on R19)available through EPP (now Ward Investments) and not on general sale.  I must say here that Ward immediately informed us of the situation at San Jose.  The completion date is May 2009 with a 3 month extension period (as is common practice).  We DO have a bank guarantee.  It is written into our purchase/sale contract complete with details eg. passport number etc.  I have today emailed our Spanish solicitor with some questions mainly based on process and timescales.  If San Jose have to go into liquidation what is the process in respect of the bank guarantee?  And if they are able to re-negotiate their debts etc and continue to trade am I correct in that we would have to wait until Sept 2009 to claim back our money under their breach of contract if the villa was still uncompleted?

I am told that San Jose are at an advanced stage of negotiations to secure lines of credit and that work should recommence at El Pinet shortly with SADM following thereafter.  Maybe we should take a cynical view of this but it could be true......

PSI have over 200 Amba sun clients that are obviously trying to reclaim deposits or find an answer.

Something that may be of intetrest is that if the developer does go into liquidation and the properties never complete then commissions can be claimed back by the developer from the agent,in essence this means that the large agents could be forced to pay back on average 4 million euros in commission.

It doesn't take much to figure out what will happen to the agents if they are forced to find this amount of money.........

I sympathise with everyone in this situation and this is just another nail added to the coffin of Spanish new build real estate.

As someone who has worked here and knows the development well enough i am suprised so many people purchased property without firstly seeing the licence and secondly taking someones word for it that it existed,with a project of such a huge scale licence issues were always going to slow the process and restrict build and completion.

I wish you all the best and hope you all get compensated..........