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El blog de Maria

Your daily Spanish Law reporter. Have it with a cafe con leche.

Legal tip 1396.LEY 57/1968 Won Case in First Instance Court against Banco Sabadell for our client who purchased an off-plan property from the developer Casa Mediterranea Construcciones at Residencial Pinada del Rio
19 July 2016 @ 12:46

LEY 57/1968 Won Case in First Instance Court against Banco Sabadell for our client who purchased an off-plan property from the developer Casa Mediterranea Construcciones at Residencial Pinada del Rio

We were extremely pleased to inform our client recently that we had won their case against BANCO SABADELL in the First Instance Court.

The client paid their off-plan deposit according to the Purchase Contract to the developer’s bank account at Banco Guipuzcuano (now Banco Sabadell).  The client did not receive an individual Guarantee for their off-plan deposit from the developer, Casa Mediterranea Construcciones or from the developer’s bank.

PO xxxx/2012

Please find attached Sentence number xx/2016 from the First Instance Court No.11 in Alicante.

Your case against BANCO SABADELL has been won.

The final paragraph of the First Instance Sentence delivered on 21 June 2016 and notified on 22 June 2016 states:

“Fully upholding the Lawsuit filed on behalf of xxxxxx against BANCO DE SABADELL S.A. and condemn the defendant, BANCO DE SABADELL, to pay the plaintiff, xxxxxx, the amount of xxx,xxx€ plus legal interest from the date on which the amounts were paid to the account.  Costs are imposed on the defendant as per article 394 of the LEC”

So BANCO SABADELL is sentenced to refund the total amount of xxx,xxx€ plus interest at the legal rate from the date on which each amount was paid to the developer’s bank account.

Costs of the First Instance procedure are imposed on BANCO SABADELL.

Interesting statements from the Judge in the Sentence were:

“The claimant signed a purchase contract with the entity Casa Mediterranea Construcciones S.A. on 10 August 2004 for the purchase of a home in the development Residencial Pinada del Rio.

The off-plan deposit was paid to the Special Account of the developer at Banco Guipuzcuano (now Banco Sabadell).

The Bank argued that it was not a Special Account.  However, during questioning at the Trial the developer confirmed that the Bank had knowledge that the account was used for the receipt of off-plan funds.  From documentary evidence relating to the account it is clear that payments into the account were referenced as being for specific housing types at Pinada Del Rio.

Therefore it is clear that the funds were from buyers for off-plan purchases.  If the Bank did not make adequate efforts to manage control of the said account then it cannot claim that lack of diligence against a third party”

BANCO SABADELL S.A. has 20 working days from the date of notification of the Sentence, which was 22 June 2016, to comply with the Sentence or to file an Appeal to the Provincial Appeal Court of Alicante.

Although any appeal must be submitted strictly within the 20 working day deadline, we may not receive notification of an Appeal or of a firm sentence from the Court for a few weeks after the deadline due to the workload of the Court.

If an Appeal is filed by BANCO SABADELL S.A. it will be necessary for us to file an Opposition to the Appeal on your behalf.

Like 0


Spanishpunter said:
19 July 2016 @ 13:53

and so it goes on-the Banks continue to lose sometimes the cost go in their favour, although one wonders why buyers have to go to Court to establish Spanish Law which has been on their Statute Book for years!
Must surely be at the point when the Banks just pay out on the production of evidence of a deposit being paid
I'm sure that an objective observer now sees that the Banks are moving into 'embarrassment' territory!

mariadecastro said:
19 July 2016 @ 14:53


Different facts and law application to them are the reason these cases are still being played. Anyhow, I agree with you that Banks are moving into embarrassment territory!

ads said:
19 July 2016 @ 23:34

How many of these cases that no longer demonstrate "different facts" but where principles of law have already been clarified are still subjected to appeals, Maria?
Are the banks in this regard challenging the principle of legal certainty in Spain?

Keith110 said:
20 July 2016 @ 10:27

Ads......most cases have 'different facts' albeit very small differences. Sometimes buyers pay direct to the developers bank account as stated in the purchase contract. Sometimes buyers pay to an agent or other third party who then transfers on their behalf to the developers bank account. Sometimes buyers pay to a developers account at a different bank to the one listed in the purchase contract. Sometimes buyers pay via a money transfer company who does not include the plot reference etc in the transfer document. There are many different scenarios and banks will use any argument, however small, to try and avoid liability.

Although many cases are being won against banks in the First Instance Courts it is still very common for the Banks to appeal to the Provincial Appeal Courts.

The bank will appeal the whole sentence including the awarding of interest and the imposition of costs. Recently we have some cases that have been won in First Instance with full interest from the date of payment and costs imposed on the bank/insurer. The bank/insurer then appeals to the Provincial Appeal Court - the main appeal is lost but on the subject of costs, the Provincial Appeal Court reverses the part of the First Instance Sentence that imposed costs on the Bank/Insurer. So the First Instance Sentence against the Bank is confirmed but costs are no longer imposed on the bank. So each party will then have to pay its own costs of the First Instance. And....because this is then considered as the appeal being 'partially won' by the Bank/Insurer (due to the imposition of costs being removed from the First Instance Sentence) the costs relating to the Appeal are then not imposed on any party. So each party also pays its own costs for the appeal.

So the buyer ends up with Principal & interest from the date of payment as per the First Instance Sentence, but has to pay its own costs of the First Instance and of the Provincial Appeal.

You can see an example of this in María's Legal tip 1395.

The reason for this as the Provincial Appeal Court Magistrates explain is due to the fact that when the Lawsuit was filed and the bank/insurer filed its defence, there was legal uncertainty relating to LEY 57/1968 due to the fact that the various Supreme Court sentences clarifying aspects of LEY 57/1968 were only issued in late 2015 or 2016. This is how the Magistrates explained in the case I refer to:

"With regards to costs of the First Instance, the appellant (SGR) alleges infringement of article 394 of the LEC (Civil Code). The Lawsuit was admitted into procedure in 2012. The appellant (SGR) filed its defence in time on 14 February 2013. The Supreme Court Sentence which mainly supports the condemnation of SGR according to the General Guarantee it issued is dated 23 September 2015, so at the time that SGR filed its defence in February 2013 that Supreme Court Sentence had not been issued. Therefore, it is true that in February 2013 there existed legal doubts regarding the liability of the General Guarantor in these types of cases. Therefore, we must reverse the imposition of costs of the First Instance. Therefore in accordance with article 394 of the LEC, each party will pay its own costs of the First Instance procedure.

Regarding the costs of this Appeal, the truth is that the Appeal filed by SGR has been partially successful in the sense that the part of the First Instance Sentence relating to the imposition of costs has been reversed. So pursuant to Article 398.2 of the LEC costs of this Appeal are not imposed on any party. Therefore, each party will pay its own costs in respect of this Appeal”

ads said:
29 August 2016 @ 02:26

Thank you Keith.

Once again we appear to be witnessing the Banks exploiting every instance where SC rulings have not yet been achieved as a cynical purposeful ploy to avoid imposition of costs on the Banks, in full knowledge that their continual ongoing challenges directly exacerbate delays within the court and judicial system which in turn ironically delays the advancement of SC clarification upon which imposition of costs appears dependent.

Doesn't this apparent purposeful ongoing exploitation of the system by the Banks, to deny clients rightful return of costs during increasingly lengthy interim periods, now call for the judiciary to review the wider perspective and demonstrate moral authority by consistently increasing the interest payments by "sufficient" points, to act as adequate compensation for non impostion of costs?

This "default" position with failure to impose costs on the Banks in these lengthy interim periods appears increasingly morally indefensible and unfairly "weighted" to the benefit of Banks and sadly does little to act as disincentive for Banks to continue with their manipulative ploys to cause maximum disruption to the court and judicial system which in turn ironically delays essential SC clarification.

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