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Pubnlic Health care in Spain  guaranteed to persons who hold the status of insured person

Who are insured persons?

Those who are:

- Employed or self-employed worker affiliated to Social Security
- Pensioner of the Social security system.

- Beneficiary of any other periodic provision of Social Security,  including the provision and the allowance for unemployment or other of similar nature.
- Already exhausted the benefit or allowance for unemployment or other benefits of a similar nature, are unemployed, does not credit his  condition of insured by any other title and reside in Spain.

Foreigners with permission to reside in Spanish territory have the same legal regime than community or assimilated foreigners.

Foreigners not registered or authorized as residents in Spain, are entitled to receive medical assistance only in the following ways:

- In emergencies related to serious illness  or accident,  until the situation of medical discharge.
- In assistance to pregnancy, childbirth and postpartum.

In any case, foreigners under 18 years of age receive health care under the same conditions as Spaniards.

Country house, beside the Guadalentin river, through the provinces of Almería and Murcia, south eastern Spain

Check our two new websites to help you fully--- and at great prices—when renting or relocating to Spain

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A nice house in Canela Island, Ayamonte, Huelva, Costa de la Luz, South western Spain

LEY 57/1968 WON CASE in SUPREME COURT AGAINST CAJA INSULAR DE AHORROS DE CANARIAS (now BANKIA) FOR OUR CLIENTS WHO PURCHASED TWO OFF-PLAN PROPERTIES FROM THE DEVELOPER CONSTRUCCIONES LUAYRA S.L. AT THE ‘EL SOBRAO’ DEVELOPMENT IN TRIQUIVIJATE, FUERTEVENTURA

We were extremely pleased to inform our clients today that we had won their case against BANKIA in the SUPREME COURT.

The clients paid their off-plan deposit to the developer’s account at CAJA CANARIAS (now BANKIA).  The clients did not receive an individual Guarantee for their off-plan deposit from the developer, Construcciones Luayra S.L. or from CAJA CANARIAS, the Bank that received the off-plan deposit and also advanced a construction mortgage loan to the developer.

The purchase contracts were signed in November 2006 and the off-plan deposit was paid in February 2007 by bank transfer to the developer’s account, designated in the contracts, at Caja Canarias.

In 2009 we filed a Lawsuit on behalf of our clients, against the developer for breach of contract.  In 2010 the First Instance Court issued a Sentence cancelling the purchase contracts and condemning the developer to return the off-plan deposit plus interest from the date of the court summons.  We enforced the Sentence, however due to its financial situation the developer did not pay.

In April 2011 we then filed a Lawsuit on behalf of our clients, against the developer’s Bank – Caja Canarias – asking for conviction of the bank according to its liability under Article 1.2 of LEY 57/1968.  The Bank opposed the Lawsuit on the grounds that it had not opened a Special Account for the developer, had not issued the individual guarantee to the buyers and just because it had given a mortgage loan to the developer did not make it liable for the off-plan deposits paid by the buyers.

In September 2011 the First Instance Court dismissed the Lawsuit and absolved the Bank of all responsibility.  Costs were imposed on our client.  We filed an appeal and in September 2013 the Provincial Appeal Court dismissed the Appeal, confirmed the First Instance Sentence and imposed costs of the appeal on our client.

In October 2013 we drafted and filed a Cassation Appeal to the Supreme Court which was accepted into procedure in October 2014. 

The Supreme Court has now upheld our Cassation Appeal, revoked the First Instance & Provincial Appeal Court sentences and condemned BANKIA to refund the off-plan deposit plus interest at the legal rate from the date the off-plan payments were paid to the developer’s account.  Costs of the First Instance Procedure are now imposed on the Bank.  In accordance with article 398.2 of the Civil Code costs of the Provincial Appeal Court procedure and the Supreme Court procedure are not imposed on any party.  Therefore, each party will pay its own costs for the Appeal procedures.

The Supreme Court has now fixed jurisprudential doctrine regarding Banks liabilities and obligations according to LEY 57/1968 as follows:

‘In house sales governed by Law 57/1968 credit institutions (banks) that receive income from buyers in the promotor’s account without requiring the opening of a special account and the corresponding guarantee or warranty, shall be liable to the buyer for the total amounts paid by buyers and deposited in the account or accounts the developer has opened in that entity’

This is a significant achievement for our clients and for the Costaluz Lawyers/DeCastro legal teams.  We began writing and posting about Banks liabilities according to LEY 57/1968 in 2009 when there was very little case law to support our arguments.  In the period 2009 to 2012, not only did we have virtually no support for our legal arguments but we were at times criticised in the public domain by other Lawyers.  Now the Supreme Court has fixed doctrine regarding developer’s Banks liabilities according to LEY 57/1968 using virtually the same words that we had repeatedly written more than 5 years ago.

The rest as they say is history and in the last 4 years we have won well over 150 cases for our clients against developer’s banks including the landmark Finca Parcs Action Group case in June 2012.

Re: YOUR CASE AGAINST CAJA INSULAR DE AHORROS DE CANARIAS (BANKIA S.A.U.) – PO-898/2011

Please find attached Sentence number 174/2016 from the TRIBUNAL SUPREMO (Supreme Court).

I am very pleased to advise you that your Cassation Appeal has been upheld and the Provincial Appeal Court Sentence and First Instance Sentence have been reversed.

The final paragraph of the First Instance Sentence delivered on 12 September 2011 and notified on 16 September 2011 stated:


“I dismiss the Lawsuit filed on behalf of xxxxxx & xxxxx and absolve CAJA INSULAR DE AHORROS DE CANARIAS (BANKIA S.A.U) of all claims against it with the express imposition of costs on the plaintiff”


The final paragraph of the Appeal Court Sentence delivered on 24 July 2013 and notified on 27 September 2013 stated:


“That dismissing the Appeal filed by xxxxx & xxxxx against the Sentence of the First Instance Court No.16 of Las Palmas dated 12 September 2011 in ordinary procedure 898/11, we confirm that Sentence and impose the costs of this appeal on the appellant”.


The final paragraphs of the Supreme Court Sentence delivered on 17 March 2016 and notified on 21 March 2016 state:

“1. - Uphold the appeal for cassational interest brought by the applicants xxxxx & xxxxx, against the sentence delivered on 24 July 2013 by the 4th Section of the Provincial Appeal Court of Las Palmas in the appeal No. 69/2012.

2. - Settle the sentence under appeal, leaving it void.

3. - Reiterate the following jurisprudential doctrine: ‘In house sales governed by Law 57/1968 credit institutions (banks) that receive income from buyers in the promotor’s account without requiring the opening of a special account and the corresponding guarantee or warranty, shall be liable to the buyer for the total amounts paid by buyers and deposited in the account or accounts that the developer has opened in such entity’

4.- Consequently, upholding the appeal filed at the time by the said plaintiff against the judgment delivered on 12 September 2011 by the head judge of the Court of First Instance No. 16 of Las Palmas Gran Canaria , to revoke and instead:

A) Fully uphold the lawsuit filed by the appellant against the entity Caja Insular de Ahorros de Canarias (now Bankia SA).

B) And condemn the defendant to pay the plaintiffs the amount of 107,800 euros increased with the current legal interest rate since the off-plan payments were made in the developer’s accounts at Caja Insular de Ahorros de Canarias until the date of repayment.

5. - Not to impose the costs of the cassation appeal or those of the second instance (provincial court appeal) on any party, but impose on the defendant the costs of the first instance.

6. - And return to the appellant the deposit paid for the cassation appeal”

So your Cassation Appeal has been upheld by the Supreme Court.

The First Instance Sentence and Provincial Appeal Court Sentences have been reversed and rescinded.

So your Lawsuit against Caja Insular de Ahorros de Canarias (now Bankia) is now fully upheld.  Bankia is condemned to pay you 107,800€ plus legal interest from the date you paid your off-plan deposit to the developer’s bank account until full repayment.

Costs of the First Instance procedure are now imposed on Caja Insular de Ahorros de Canarias (Bankia).

There is no express imposition of costs relating to the Provincial Court Appeal procedure or to the Cassation Appeal in the Supreme Court.  So each party will pay its own costs in respect of the Provincial Court Appeal and for the Cassation Appeal.

Interesting statements in the Sentence from the Supreme Court Magistrates are:


”The First Chamber of the Supreme Court has seen the appeal brought by the plaintiffs xxxxx & xxxxx, against the sentence delivered on 24 July 2013 by the 4th Section of the Provincial Court of Las Palmas in the appeal No. 69/2012, arising out of ordinary procedure No. 898/2011 from the Court of First Instance No. 16 of Las Palmas on reclaiming of amounts paid.  The party sued is the entity Bankia, S.A. (successor of Caja Insular de Ahorros de Canarias).

FACTUAL BACKGROUND

FIRST. - On 2 May 2011 a Lawsuit was filed by xxxxx & xxxxx against Caja Insular de Ahorros de Canarias, currently Bankia SA, requesting the sentencing as follows:

"a) To order the return of the amounts paid on account and deposited in such financial entity amounting to 107,800€.

b) plus statutory interest at 6% per annum, Article 3 of Law 57/68.  Alternatively interest at the legal rate.  In any case, from the date of delivery of the funds in current accounts of LA CAJA DE CANARIAS until full repayment.  Alternatively, from the date of filing of the Lawsuit.

c) and the costs"

SECOND.- The Lawsuit was admitted to the Court of First Instance No. 16 of Las Palmas, leading to ordinary trial No. 898/2011.  The defendant Bankia SA was located and answered the Lawsuit opposing it in full and stating the Lawsuit should be dismissed entirely, with the express imposition of costs to the claimant.

THIRD.- The Court of First Instance gave judgment on 12 September 2011 dismissing the claim, absolving the defendant and imposing the costs to the claimant.

FOURTH.- The applicant then appealed against the First Instance Sentence. The Appeal was dealt with under appeal No. 69/2012 in the 4th Section of the Provincial Court of Las Palmas, who issued a sentence on 24 July 2013 dismissing the appeal and imposing costs to the appellant.

FIVE.- Against the sentence of the second instance the plaintiff-appellant appealed under Article 477.2.3. in conjunction with Article 477.3 of the LEC.

The appeal was based on two arguments:

"First Argument – Erroneous application of the fundamental legal facts that are declared proven.  Violation of the provisions of the 2^nd Rule of Article 1 of Law 57/1968, which determines the subsidiary responsibility of the financial institution that opens the current account, without requiring the developer to obtain guarantees in favour of the buyers, as said in that article "for the opening of these accounts or deposits, the bank or savings bank, under its responsibility, will require the guarantee referred to in the above condition"

"Second. Erroneous application of the fundamental legal facts that are declared proven. Violation of Article 1.902 of the Civil Code, which determines the extra contractual subsidiary responsibility of the financial institution that opens the special current account for the promoter without requiring the guarantees for buyers under Articles 1, 3 and 7 of Law 57/68, whose content is imperative and indispensable to the buyer. These articles provide "for opening these accounts or deposits, the bank or savings bank, under its responsibility, will require the guarantee referred to in the above condition"

SIX.- The Cassation Appeal was accepted by an order dated 7 October 2014. The respondent did not file notice of opposition to the appeal.

SEVENTH. - By an Order of 12 February 2016 the head magistrate was appointed and it was agreed to resolve the appeal without a hearing.  The meeting of the Magistrates to decide the Appeal took place on 8 March 2016.

The Magistrate Mr. FRANCISCO MARÍN CASTÁN says:,

LEGAL BASIS

FIRST. - The plaintiffs, buyers of two off-plan houses under the regime of Law 57/1968 of 27 July on receiving of advance quantities in the construction and sale of housing (hereinafter Law 57/1968), resort to cassation appeal against the sentence of the Provincial Appeal Court that confirmed the First Instance Sentence, which dismissed their claim for reimbursement of the amounts advanced and not guaranteed, plus interest.

The decision on the appeal must be based on the following facts:

1. On 28 November 2006 xxxxx & xxxxx, signed with the developer Construcciones Luayra S.L. two contracts for the sale of separate houses with pool that were to be built in the real estate complex "El Sobrao" in Aljibe Blanco, Triquivijate, municipality of La Antigua de la Isla de Fuerteventura, at prices of 297,500 euros and 296,500 euros respectively plus VAT (5%).

2. The purchaser gave to the developer, on account of the price of both houses the total sum of 118,000 euros, of which 107,800 euros was paid through bank transfers on 2 February 2007 (61,500 euros) and 9 February 2007 (46,300 euros) to the account 2052 8148 6949 0001 5705 designated in the contracts, that the developer had opened in the office of the Caja Insular de Ahorros de Canarias in Puerto del Rosario (Fuerteventura). Repayment of those amounts was not guaranteed by the developer, neither with a Bank Guarantee or Insurance.

3. Construcciones Luayra S.L. had obtained a mortgage from Caja Insular de Ahorros de Canarias (now Bankia S.A.), as amended by public deed dated 2 October 2007. The initial amount was 360,000 euros. The mortgage was for, among others, the houses subject of the purchase contracts of the plaintiffs.

4. In a judgment of 30 March 2010, handed down in ordinary proceedings No. 91/2009 the Court of First Instance No. 1 of Puerto del Rosario declared the resolution of both sales contracts for breach of the seller Construcciones Luayra SL of the obligation to deliver the property in a timely fashion, condemning the developer to return the sum of 118,000 euros plus interest accrued from the date of delivery of the court summons to the developer.

5. The buyers urged the execution of the judgment, which resulted in the execution process legal title No. 591/2010 in which, by order of 17 December 2010, implementation was dispatched against Construcciones Luayra S.L. to address the payment of the principal of 118,000 euros plus 35,000 euros budgeted for interest and costs of enforcement. That enforcement has not been successful.

6. On 2 May 2011 the buyers filed a Lawsuit against Caja Insular de Ahorros de Canarias, which is the Lawsuit subject of this present case, asking for condemnation of the credit institution to the return of 107,800 euros plus interest at 6% per year, or alternatively at the legal rate of interest, in both cases from the date of payment in current account of the developer until full payment or, alternatively, from the date of filing of the Lawsuit. In support of its claim they alleged that the Bank, despite knowing the existence of the off-plan housing promotion and the origin and destination of the amounts received in the current account, were aware that the promoter had not demanded the guarantees imposed by Law 57/1968, due to which arose the legal responsibility of the Bank.

7. Bankia S.A. (successor of Caja Insular de Ahorros de Canarias) opposed the lawsuit alleging the following facts: a) lacked standing to be sued for not having delivered collateral to guarantee repayment of advances and even assuming that it issued a Global policy or General guarantee would not be obliged to refund the amounts paid for failing to issue individual policy or guarantee certificates; b) that it did not open the special account for the developer; and c) the fact that they had advanced mortgage funds to the promoter did not make it responsible for the repayment of the off-plan amounts paid by buyers.

8. The Sentence of the First Instance Court dismissed the Lawsuit because the developer-seller did not sign any guarantee with the defendant bank or any other entity mentioned in art. 1 of Law 57/1968, and that there was no trace of the guarantee or insurance that the developer must arrange, and that buyers demand, as security of the amounts paid to the account.

9. The above sentence was appealed by the plaintiffs and the Court of Appeal dismissed their appeal.

10. Against that judgment the buyer-appellant has lodged a Cassation Appeal under item 3 of Art. 477.2 LEC, which was justified by the contradictory jurisprudence from the Provincial Appeal Courts regarding the responsibility of the bank which opens the account without requiring promoter to obtain guarantees for the repayment of advance payments.

SECOND. - The Cassation Appeal (common to both reasons, which are therefore considered together) focuses on the responsibility of the financial institution in which the promoter has opened an account, which does not appear to be the special account as required by Law 57/1968, in which buyers made off-plan payments for the purchase of housing or off-plan construction whose return was not secured by insurance or guarantee.

The issue has already been resolved by this Court, in its judgment of 21 December 2015 (rec. 2470/2012), with the following legal doctrine: "In house sales governed by Law 57/1968 credit institutions (banks) that receive income from buyers in an account of the promoter without requiring the opening of a special account and the corresponding security shall be liable to the buyer for the total amounts anticipated by buyers and deposited in the account or accounts that the developer has opened in that entity"

More recently still, the judgment of 9 March 2016 (rec. 2648/2013) has reiterated the same doctrine in a case where the entity receiving the amounts advanced by buyers in a current account of the developer, not titled as a special account as required by Law 57/1968, had only endorsed a portion of those amounts and opposed to respond to the remaining amount due to the absence of a special account or guarantee.

THIRD.- Consequently, the contested sentence opposes the jurisprudence of this Court, because the responsibility to the buyers for control over the accounts of the promoter legally corresponds to the credit institution where the promoter has one or multiple accounts.

In this case, moreover, the defendant obstinately denied the reality of the off-plan payments made by the buyers, who were not the only ones to pay off-plan amounts to the said account, until that reality was incontestably established.  Its legal duty to control the buyer’s funds was hardly debatable as it was precisely the entity that had granted the mortgage loan to the developer for the construction.

FOURTH.- According to art. 487.2 LEC, ruling on the case must be done in the sense of upholding the appeal of the applicant and overturning the ruling of the First Instance as the Bank has violated article 1 of Law 57/1968 and is fully responsible to the buyers for failing to require the developer to obtain the mandatory guarantee.

We must therefore fully uphold the lawsuit and condemn the defendant Bank to pay the plaintiffs the amount of 107,800 euros, the total sum of the amounts advanced and deposited in the account opened promoter in that entity, together with legal interest accrued from the date of payment, but not at the rate of 6% per annum as set in article 3 of Law 57/1968, as requested primarily, because this rule must be understood to have been repealed by the Additional 1st Provision of the Law on Construction Planning, which sets "legal interest on money in force until such time as its return is effected"

Finally, uncertainty about the execution of the original sentence won by buyers against the promoter in a previous case cannot prevent the upholding of the lawsuit against the Bank, because the insolvency of the promoter is alleged and the defendant bank has not contested this fact, and in any case, the execution of this Supreme Court judgment will prevent the applicant being paid twice for the same concept.

FIVE.- According to art. 398.2 LEC, we should not impose on any party the costs of this appeal, because it has been upheld, nor those of the second instance, because the appeal of the plaintiffs should have been upheld.

Pursuant to art. 394.1 LEC, be imposed on the defendant the costs of the first instance, as the lawsuit is now fully upheld even though the claim for interest was at 6% per year because it was followed by an alternative request for interest at the legal rate which itself has been upheld”

Fuerteventura, Canary Islands, South of Spain

WON CASE in PROVINCIAL APPEAL COURT AGAINST CAJA GRANADA (now BANCO MARE NOSTRUM) FOR OUR CLIENT WHO PURCHASED AN OFF-PLAN PROPERTY FROM THE DEVELOPER PROMOCIONES INROAL S.L. AT THE RESIDENCIAL MEDITERRANEO III DEVELOPMENT IN ROQUETAS DE MAR

We were extremely pleased to inform our client recently that we had won their case against BANCO MARE NOSTRUM in the Provincial Appeal Court.

The client paid their off-plan deposit to the developer’s account at BANCO POPULAR.  The client did not receive an individual Guarantee for their off-plan deposit from the developer, Promociones Inroal S.L., BANCO POPULAR or from CAJA GRANADA (now BANCO MARE NOSTRUM), the Bank signed a Guarantee Line with the developer.

In November 2014 the First Instance Court in Roquetas de Mar dismissed our Lawsuit and absolved Caja Granada of all claims against it.

Under instructions from our client we submitted an Appeal to the Provincial Appeal Court of Almería.

The Provincial Appeal Court has upheld our Appeal, revoked the First Instance Sentence and condemned BANCO MARE NOSTRUM to refund the off-plan deposit plus interest at 6% per annum from the date the Lawsuit was filed in 2013 plus the costs of the First Instance Procedure.

Re: YOUR CASE AGAINST CAJA GENERAL DE AHORROS DE GRANADA (BANCO MARE NOSTRUM S.A.)
PO xxx/2012

Please find attached Sentence number xx/16 from the Provincial Appeal Court of Almería Section 1.

I am very pleased to advise you that your Appeal has been upheld and the First Instance Sentence has been reversed.

The final paragraph of the First Instance Sentence delivered on 28 November 2014 and notified on 28 January 2015 stated:

“I dismiss in its entirety the Lawsuit filed on behalf of xxxxx xxxxx against CAJA GENERAL DE AHORROS DE GRANADA now BANCO MARE NOSTRUM S.A. and therefore acquit and absolve the defendant of all claims against it with the express imposition of costs on the plaintiff”


The final paragraph of the Provincial Appeal Court Sentence delivered on 11 March 2016 and notified on 16 March 2016 states:


“Upholding the Appeal filed by the legal representation of the plaintiff, against the Sentence of 28 November 2014, issued by the Judge of the First Instance Court No.3 of Roquetas de Mar, we reverse and revoke that resolution, and instead, fully uphold the Lawsuit filed by xxxxx xxxxx, condemning the defendant Banco Mare Nostrum S.A. to pay to the plaintiff the amount of xx,xxx Euros plus interest calculated at 6% from the date on which the Lawsuit was filed; and to pay the costs arising from the First Instance.  Without express order for costs of this Appeal”


So your Appeal has been upheld and the First Instance Sentence has been reversed and rescinded.

Banco Mare Nostrum is now condemned to pay you xx,xxx€ plus interest at 6% per annum from the date the Lawsuit was filed in 2013.

Costs of the First Instance procedure are now imposed on Banco Mare Nostrum.

There is no express imposition of costs relating to the Provincial Court Appeal.  So each party will pay its own costs in respect of the Appeal.

Interesting statements in the Sentence from the Provincial Appeal Court Magistrates are:

“The present case highlights the problem that arises in house purchases, when this is done before construction work begins or during it, and amounts are paid on account of the final price.  The protective legislature in case of work not starting or not completing, for whatever reason, imposes a legal obligation to the promoter to have guaranteed the amounts paid on account by the purchaser as provided in Article 1 of Law 57/1968 and additional provision of the law of construction management by the relevant contract of insurance or guarantee to ensure such repayment.

In short, we insist that, LEY 57/1968 applicable to the case before the Court, establishes general preventive rules ensuring both the real and effective protection of the amounts paid by buyers of homes.

The legislation is clear and transparent, Article 1 of Law 57/1968 states: ‘Individuals and legal entities that promote housing construction of a home or family residence, with either permanent or seasonal use and seeking to obtain advances from buyers before construction begins or during it, must meet the following conditions: 1st. Guarantee the repayment of the amounts paid plus 6% annual interest by insurance contract awarded with an insurance entity registered and licensed in the Register of the General Department of Insurance or joint and several guarantee provided by an entity registered in the Register of Banks and bankers or savings banks, in the event that construction does not start or does not reach a successful conclusion for any reason by the agreed deadline.  2nd. Receive the amounts anticipated by the buyers through a bank or savings bank, which must be deposited in a special account with separation of any other kind of funds belonging to the promoter and which may only be used for the construction of housing. For opening these accounts the bank or savings institution, under its responsibility, will require the guarantee that the above condition refers to’.  Article 7 of the Act states: ‘The rights that this Law grants to the buyers shall be considered irrevocable’.  First Additional Provision of Law 38/1999 of 5 November on Construction Planning, states that: ‘The receiving of sums advanced for building by promoters will be covered by insurance indemnifying breach of contract to the provisions of Law 57/1968’.

The first argument of the First Instance Court to reject the Lawsuit is the lack of personal guarantee that was never delivered to the buyer by the developer, in addition to denying the existence of a special account. The jurisprudence from the Supreme Court leads to failure the aforementioned reasoning, the failure of the promoter or guarantor to deliver the individual guarantee can in no way harm the buyers, who are unaware of the relationship between promoter and credit institution.

The same is true about the lack of delivery of the sums advanced by buyers to the special account, since this is also an obligation of the promoters, the account opening and depositing the amounts.  The contract states that the advance payments will be guaranteed by bank guarantee granted by Caja Granada office 0503 Calle Benizalón # 1 of Almería and there is a Guarantee Policy and Guarantee Line signed on 17th October 2005 between the entity and Promociones Inroal.

Finally, as to the fact that the Bank did not participate in the financing of the promotion where the plaintiff purchased; we must say that the law does not require this to lead to an obligation to guarantee. Conversely Article 1 of Law 57/1968 provides for the assumption that future buyers payments delivered before construction work begins or during construction and Article 2 requires repayment in the event that construction does not start or complete by the agreed time.  We reiterate the obligation to open the special account is that of the promoter as well as ensuring the funds received are paid into the special account.

The fundamental test, according to the First Instance Court is that the defendant is not bound by any General Guarantee it has provided because there is no record of the buyers payment in the account linked to the General Guarantee.  This Court does not share the reasoning of the First Instance Court because it is clear that there is a general policy issued by the bank in favour of the promoter to guarantee amounts paid by buyers and the fact that advance payments have been deposited in accounts specified by the promoter but no individual guarantees have been issued, is the responsibility of the bank.  The bank was aware of the operations of its client – a housing promoter whom it had guaranteed and of several buyers of this promotion.  As to which account the buyers funds were paid is the responsibility of the developer because the buyer follows the vendor's instructions.

As the old aphorism says things are what they are and not what the parties say they are, as rightly pointed out by the appellant, the evidence must be assessed as a whole, and although the policy has a definite end, the documents precisely reveal the facts.  In short, the payment obligation arises clearly; to no avail the objections raised because relations between the developer and the bank can not harm the buyers.  The need for individual endorsement and approval of the bank to grant it, are matters that affect the contracting of the policy, but not the buyers.  We must not forget the last sentence of the second paragraph of Article 1 of Law 57/1968: ‘For the opening of these accounts or deposits the bank or savings bank, under its responsibility, will require the guarantee referred to in the above condition’.  Responsibility is born from the moment that the special account is opened and the buyers amounts are accepted into the account”

BANCO MARE NOSTRUM has 20 working days from the date of notification of the Sentence, which was 16 March 2016, to comply with the Sentence or to file a Cassation Appeal to the Supreme Court.

If a Cassation Appeal is filed by the defendant it will be necessary for us to file an Opposition to the Appeal on your behalf.

Roquetas de Mar, Almería, South eastern Spain

QUICK STARTING A BUSINESS IN ANDALUCIA: LIABILITY DECLARATION SUBSTITUTES  OPENING LICENSE

A Law dated 2014 established a mechanism by which liability declarations of business owners substituted the corresponding Opening Licenses by  Local Councils in Andalucía.

Now, in January 2016, it has been necessary to pass rules for making easier  the  application of the legal text and define the cases in which the liability  statements have the same effects as the license it replaces. Local Authorities may approve a model.

Through the liability declaration , the interested party  manifest under its responsibility,  that the business meets  the requirements of current legislation in addition to being in possession of proof of payment of the tax when this is  mandatory.

This document, once it is duly sworn and  filed with the competent authority, provided that the activity takes place in the consolidated urban land, have the same effect that the license it replaces .

Fincahotel, with 18 rooms and restaurant, 20,000 square metres, for sale (850,000 Euros). In Huelva, Costa de la Luz, South western Spain.

Along several posts we are walking through Spain Rental Law in simple words….

Are you walking with us?

We are explaining applicable rules for the renting of urban properties intended for housing or uses other than housing.

Previous chapters:

Chapter one

Chapter two

Chapter three

16. Determination of the rent

Rent will be the one freely decided by the parties

 Unless there is an opposite agreement, the payment of the rent will have to be done monthly during the first seven days of the month. In no case the landlord will be allowed to require the prepayment of more than one month's rent.

 The payment will be done at the place and by the procedure agreed by the parties or, failing it, in cash and in the rented housing.

 The landlord is obliged to give to the tenant a receipt of the payment, unless it was agreed that it is carried out by proceedings that prove the effective fulfillment of the payment obligation by the tenant.

The receipt or proving document that replaces it will have to contain separately the amounts paid by the different items that form the entire payment and, specifically, the rent in force.

 In the renting contracts it will be allowed to be freely agreed by the parties that, during a specified period, the obligation of the payment of the rent can be replaced wholly or partially by the tenant’s commitment to reform or rehabilitate the property under the terms and conditions agreed.

At the end of the renting, the tenant will not be allowed to ask for in any case an additional compensation for the cost of the works done in the building.

The breach by the tenant of the fulfillment of the work under the terms and conditions agreed will be allowed to be a cause for termination of the renting and it will be applicable the provisions of paragraph 2 of Article 23.

17. Updating  of the rent

 During the validity of the contract, the rent will be allowed to be updated by the landlord or the tenant after every period of one year, under the terms agreed by the parties.

In the absence of an express agreement, the contract will be updated applying to the preceding annual rent, the percentage change of the  Competitiveness  Guarantee Index in a period of twelve months immediately previous to the date of each update, taking as reference month for the first update the one corresponding to the last index that was published at the date of the conclusion of the contract, and successively ,the one that  corresponds to the last one applied.

 The updated rent will be required to the tenant since the month after the one in which the interested party notifies it to the other party by writing, stating the percentage of applied change and accompanying it , if the tenant so requires, with the appropriate certification from the National Institute of Statistics. It will be valid the notification done by a note in the monthly receipt of the previous payment.                                                                                                                         

18 .   Increase of the rent because of improvements

The carrying out by the landlord of improvement works, within three years of the contract will entitle him, unless there is an opposite agreement, to increase the annual rent in the amount that results from applying the capital invested in the improving work, the legal interest rate of the money at the time of the end of works plus three points, without exceeding the increase twenty percent of the current rent at that time.

For the calculation of the invested capital, the public subsidies obtained for the realization of the work will have to be discounted

When the improvement affects to several properties of a building in horizontal property regime, the landlord will have to distribute proportionally among them all the invested capital, applying, for this purpose, the installments of participation that corresponds to each one of them. In the case of buildings that are not in horizontal property regime, the invested capital will be distributed proportionally among the affected properties by agreement between landlord and tenant. In the absence of agreement, it will be distributed proportionally according to the surface of the rented property.

3. The increase of the rent will take place since the month following to that in which, the works already finished, the landlord notifies by writing to the tenant the amount of it, detailing the calculations leading to its determination and providing copies of documents from which the cost of the works can be confirmed

 19. General and individual services expenses

The parties will be allowed to agree that the general expenses for the proper maintenance of the property, its services, taxes, charges and liabilities that cannot be individually allocated and correspond to the renting housing or its accessories, are paid by the tenant.

In buildings under horizontal property regime such expenses will be those corresponding to the renting property based on its share of participation

In buildings that are not under horizontal property regime, such costs will be those assigned to the rented property based on its surface.

To be valid, this agreement will have to be written and to determine the annual amount of such expenses to the date of the contract. The agreement that refers to taxes will not affect the Administration.

During the first three years of validity of the contract, the amount that the tenant has to pay for the item referred to in the previous section, with the exception of taxes, it will only be allowed to be increased by an agreement of the parties, annually, and never in a percentage superior to double than that in which the rent can be increased as provided in point 17.

The expenses because of services that the rented property has, individualized by using counters equipment will be paid in all cases by the tenant.

4. The payment of the expenses referred to in this Article, will be proved as provided in point 16.                                                                                                                                              

El Gastor (named "The Balcony of the White Villages"), Cádiz, South of Spain

WON CASE in PROVINCIAL APPEAL COURT AGAINST CAJA GRANADA (now BANCO MARE NOSTRUM) FOR OUR CLIENT WHO PURCHASED AN OFF-PLAN PROPERTY FROM THE DEVELOPER PROMOCIONES INROAL S.L. AT THE ANDARAX DEVELOPMENT IN TERQUE

We were extremely pleased to inform our client today that we had won their case against BANCO MARE NOSTRUM in the Provincial Appeal Court.

The client paid their off-plan deposit to the developer’s account at CAJA GRANADA (now BANCO MARE NOSTRUM).  The client did not receive an individual Guarantee for their off-plan deposit from the developer, Promociones Inroal S.L. or from CAJA GRANADA, the Bank to which their off-plan deposit was paid and the Bank that signed a Guarantee Line with the developer.

In January 2015 the First Instance Court in Roquetas de Mar dismissed our Lawsuit and absolved Caja Granada of all claims against it.

Under instructions from our client we submitted an Appeal to the Provincial Appeal Court of Almería.

The Provincial Appeal Court has upheld our Appeal, revoked the First Instance Sentence and condemned the Bank to refund the off-plan deposit plus legal interest and the costs of the First Instance Procedure.


Re: YOUR CASE AGAINST CAJA GENERAL DE AHORROS DE GRANADA (now BANCO MARE NOSTRUM S.A.)
PO xxx/2012

Please find attached Sentence number 54/16 from the Provincial Appeal Court of Almería Section 1.

I am very pleased to advise you that your Appeal has been upheld and the First Instance Sentence has been reversed.

The final paragraph of the First Instance Sentence delivered on 19 January 2015 stated:

“I completely dismiss the Lawsuit filed on behalf of XXXXX & XXXXX against CAJA GENERAL DE AHORROS DE GRANADA now BANCO MARE NOSTRUM S.A. with the imposition of costs on the plaintiff”


The final paragraph of the Provincial Appeal Court Sentence delivered on 16 February 2016 and notified on 3 March 2016 states:


“Upholding the Appeal brought against the Sentence of 19 January 2015 in procedure PO XXX/2012 from the First Instance Court No.2 of Roquetas de Mar and therefore we must reverse and revoke that resolution, and in its place:

First – Condemn the defendant Caja General de Ahorros de Granada (now Banco Mare Nostrum S.A.) to pay to the plaintiff the amount of XX,XXX Euros plus legal interest on that amount.
Second – Impose the costs of the First Instance on the defendant
Third – Without express order for costs of the Second Instance”


So your Appeal has been upheld and the First Instance Sentence has been reversed and rescinded.

Banco Mare Nostrum is now condemned to pay you XX,XXX€ plus legal interest.  We are seeking clarification from the Provincial Appeal Court as to when the interest will accrue from. 

Costs of the First Instance procedure are now imposed on Banco Mare Nostrum.

There is no express imposition of costs relating to the Provincial Court Appeal.  So each party will pay its own costs in respect of the Appeal.

Interesting statements in the Sentence from the Provincial Appeal Court Magistrates are:

“Document 3 provided by the plaintiff is a Guarantee Line Policy signed between the developer and said financial institution dated 16 October 2007.  When the plaintiffs contacted the Bank in March 2011, before starting this litigation, the Bank replied and did not deny that a Guarantee Line Policy was issued but in respect of the claimants it stated that the Bank had not been requested to issue an individual guarantee in their favour.  Consequently the bank advised the claimants that any questions related to the purchase contract should be directed to the developer, Promociones Inroal S.L.

It is established that the plaintiff’s off-plan deposit was entered into the developers account in Caja Granada (now BMN).  All entries in that account are referenced as income from individuals or as named expenses & loan repayments.  Therefore it follows that the Bank was aware of business of the developer and the off-plan promotion and therefore it operated as a Special Account.

Jurisprudence states that a General Guarantee Policy should cover all amounts paid on account by buyers even if the policy establishes a lower maximum amount, because otherwise Article 2 of LEY 57/1968 would be infringed.

The defendant cannot hide behind the non-issue of the Individual Guarantee when it operates the account opened by the developer and is aware of the purpose of the funds being paid into the account.

We must therefore revoke the First Instance Sentence”


BANCO MARE NOSTRUM has 20 working days from the date of notification of the Sentence, which was 3 March 2016, to comply with the Sentence or to file a Cassation Appeal to the Supreme Court.

If a Cassation Appeal is filed by the defendant it will be necessary for us to file an Opposition to the Appeal on your behalf.

If the defendant fails to comply with the sentence then we will enforce the sentence against it.

La Alhambra and Sierra Nevada, Granada, South eastern Spain