compensation re builders late completion

can anyone help, if a builder has gone more than 6 months over on a contract date are we legally obliged to some form of compensation. CAN WE INSIST ON IT.

Of course you need to be compensated. The extensions on contract deadlines need to be notified and accepted by you, expressly, if not they are in breach of contract and you can ask for compensation and even cancellation of contract and devolution of amounts and interests.

We paid deposit 27 months ago for off-plan property in Jumilla, were told 12-24 months build, still not started and now been told another 2 years possibly, can not get set date and will not give us bank guarantee, any advice??

Hi Mags,

As Maria will tell you, it's ILLEGAL for a builder in Spain NOT to give a Bank Guarantee when you're buying off-plan. I realize this advice doesn't help you if he sticks to his guns & you have a solicitor who won't act better for you. That's the law re Bank guarantees anyway, they're in place so you can't lose any of your money. Some builders DON'T arrange this with a bank BUT you can buy one yourself if necessary. You need to consult your solicitor & I hope he DOES help you. I'll follow the thread hoping to hear better news from you. Good luck.

Janice

Janice, can you explain bank guarantee? Is it just if developer goes bust? like ours keeps saying he is going bankrupt???

John and Trish Amarion lll Almoradi

It's just an insurance basically, John & Trish. The bank, who the builder should've lodged the guarantee with, guarantees your payments are safe IF you have a guarantee, which it seems, many don't. We weren't automatically given one but were told by our agent, AFTER WE PRESSED HIM MANY TIMES FOR AN ANSWER TO OUR QUESTION ON INSPECTION TRIP ABOUT IT, every builder selling new builds off plan with stage payments involved MUST BY LAW give a Bank guarantee. We bought after hearing that was so but there was NO mention of being CHARGED for the guarantee !!  It came to light very quickly that we were expected to pay for this so we complained that we'd been duped (pretty much) & the agent eventually "offered" to pay for it. Our financial breakdown, on completion, had 1248 € on it that they expected us to pay till we reminded them (keep all paperwork) that they said they'd pay that. This price covered the period from the day we signed the contract on 5th September, 2003 to our completion date of 20th April, 2005 which is a much shorter build time than you hear about.

Janice

Maria de Castro recently wrote the following article on bank guarantees which may be of interest to you too:

www.eyeonspain.com/spain-magazine/bank-guarantee-legal.aspx

Hi guys, thanks for the info. Learnt something new there!

 

John and Trish

Hi folks

we are in a similar position, court case coming up due to several huge breaches of contract, no LFO etc, but we only learned last year that we also never did have a BG,........good lawyer we had eh', not sure how that will affect our case?

Mariadecastro

Not sure usually the contract will say that they builders have to complete thwe works from either the day they actually started or the day they actuall got the planning consent for the build.  Check the contract

Tricia F

So,what happens if you buy and pay deposit through toital ignorance??? as most people do?? have tried emailing you on your business site quite a few weeks ago to act for us,but obviously email was not received by you?

I really feel like I'm out on  limb here! desperate to move  and should be moving now,but no property for 2 years and  more!!

would like Maria to get in touch as have tried to get in touch through this site, but obviously had no luck and have sent personal messages too, but without reply?

MagsB, I am guessing that Maria is very busy these days!

Have you tried emailing her directly at marialuisa@costaluzlawyers.es?

Justin

Please email me at: mldecastro@costaluzlawyers.es

 or marialuisa@costaluzlawyers.es

I usually don´t have any problem at receiveing email. Please try again.

Hi Maria, have emailed through the link from EOS Team,so hope you get this one,if not,could you PM me please.

Does anybody know if you cancel your contract because the deveopers are late and request a refund, is the 7% iva you paid on your deposit also refunded or is this lost as it is a tax.

hi this question is for maria, our builder is 8 months over the contract date, but he is refusing to give us any form of compensation as he says it is out of his control due to the fact the apartment has been finished approx 6 weeks but it is inacessable due to the electricity people IBODROLA having the paths dug up outside. even so this would still make him over by six and a half months. are we right to still go for some form of compensation.

Does anybody know if there is a compensation scale according to how long construction is delayed by? Or is it a case of throwing figures in the air and seeing what comes down?

Alan

Hi everyone

Unfortunately we are in a similar position.  Our contract with the builders states that we are entitled to a full refund of deposit plus interest if the build is more than six months past its original completion date.  It is now 9th months past this date with the build only just at the foundation stage and very little ongoing work.  The builder will not co-operate with our Solicitor and today he has advised me to forward to the courts to apply for a refund.  Has anyone actually won through the courts?  If so I would love to hear about your experiences, good and bad, to enable me to pursue as quickly as possible.  (if that's possible in Spain!)

sharlu

we are in a similar position, though our appartment was well over two years late!, not built to the contract specification and now, four and a half years after putting our deposit down, still has no LFO. Despite all this, many still completed, partly due to waiting so long, partly due to the worry that the developer may go bust while we waited for the right paperwork to be in place and partly through bad advice from the agent and lawyer. We have now found a good lawyer to take our several breaches of contract to court. The first one said we should complete and then claim afterwards, which was i realise now,  the worst bit of advice we ever had, and from someone we assumed was  working for us???

We know we are in the right and are now quite confident of a win. (if we dont come up agaist a corrupt judge). The very helpful lawyers, Maria on this site and Drakan on SPI have both been great in advising us on good lawyers and explaining our legal position. I'm told the tide is turning, and some developers are now settling 'out of court', as so many of them have been proved wrong.

Best of luck, and if i remember, i'll let you know how and when our case moves forward.

Best of luck with your cases guys and do please keep us updated with how it goes.

Hi Sharlu,

I've sent you a personal message explaining the background to my own claim.

Mike T

EOS Team

yes we will let you know, just to add insult to injury, after nearly 4  years of waiting, our appartment in our contract was suddenly ' not available anymore ' and we were offered one in a different position less than two thirds the size, with no discount!. Good eh!

miket

i would also be interested in your case if that's o.k.

just to add insult to injury, after nearly 4  years of waiting, our appartment in our contract was suddenly ' not available anymore ' and we were offered one in a different position less than two thirds the size, with no discount!.

 

Hi Goodstitch, When did this happen?!!

Tish

we only found out about about this through our 'new' lawyer last oct/nov. We put our original deposit down in  june 2002. After about two years, our agents finally admitted that the site we thought was half built, had in fact never been started and didn't even have a license!  The agents then transfered us to another site by the same developer with an appartment the same size, that was at least half built and we were promised it would be finished shortly. We had to pay approx £4000 more for that pleasure. So that's where we are now. Nearly 5 years on and we were told last oct/nov our appartment was not now available, but we could have one not much more than half the size, but with no discount, no LFO, or even a bank guarantee. So we are suing for breach of contract on several issues. A nightmare or what!

Hi Goodstitch,

I didn't realize the extent of your problem! What a nightmare!. I'm sure your new lawyer will come good for you in the end but it's such a slow process.  The wheels of the Spanish judicial system barely move!  Good Luck.

Tish

thanks for your positive words, it's always good to know people are behind you. It has been one hell of a worry for my wife and i, (and still is) as it was pretty much our life savings went in to this. If it wasn't for the two main sites (eos and spi) and the good people that run them and post on them, things could well be worse. The gut feeling i had that we were not being given good advice or even told the truth by people we thought we could trust was confirmed after i started poking around in the forums. We are starting to feel positive now, but the whole thing has left me feeling bitter about the whole Spanish legal sytstem.

Sounds like an Aifos style trick - happened to a mate of mine too -

Smiley

i'm sure you are right,  it's the amount of people that fall for it that's really sad. They complete, thinking they can put it right afterwards and it's to late!. Once you complete in Spain, the law is very unlikely i think , to help you put things right, even when the developers are obviously very much in the wrong! Bad advice from some agents and lawyers can and does make matters worse.

Have been checking out all replies and we are now convinced that we are definately going to have to bale out if we are ever going to have a retirement home?? Time is running out now, but the ball is starting to roll!! I realise I dont contribute anything, but then I don't know anything that would be of help, but watch this space when I get there he!he! Thanks a million for the support and help on this forum x