Rough justice yet again!

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13 Aug 2009 5:29 PM by Gillespie Star rating in Costa Calida Area. 608 posts Send private message

Gillespie´s avatar

" I am quite sure that ALL the agents knew that it was illegal to take deposits from clients before a developer had the licence to clear the ground "

Just a technicality on that comment smiley. I don't believe the deposit for a property is seen as such until the developer has recieved the funds in exchange for a purchase contract and receipt.

Which in that instance, it is the developer receiving the deposit and not the agent.

This is an important point to remember as agents do not sell anything. The agents do not own the goods, they only advertise the product in the same way Channel 4 would do in a property program or for that matter advertise Mars Bars.

If an agent is aware that a project is, at the time of advertising it, not yet legal, they are still not breaking the law if they explain to clients that in the future it will be.

I have in the past built a database of buyers for projects that were awaiting licenses, this was perfectly normal and as and when the project produced it's licenses we would contact the clients, who were eagerly awaiting to be told they could go ahead. Most would usually be speculators and investors. Also it is important to mention that many of those investors sent money to me in advance so they could get the best units in the best positions.

I am well aware that there were people in the industry who were only too happy to get some of these investors to pay before the project was confirmed legal, but as I have always said, to me, they were not proffessional property agents, they were crooks and scammers, they were just as likely to turn up selling illegal DVD's the following week but that didn't make them Amazon or Blockbusters.



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13 Aug 2009 5:30 PM by ads Star rating. 4122 posts Send private message

Thanks for your informative responses, but sorry but you're missing the point Gillespie (and to a point Smiley, although thanks for clarifying things).

In the cases where breach of contract for off-plan purchases have occured the "Spanish system" to appoint a notary to witness the off-plan purchase contract signing appears just as vulnerable as the lawyer route (I won't call it the British system) as things stand now.

I'll repeat for fear of being misunderstood, without proper legal procedures (legislation) in place the Banks will continue not to honour their commitments for return of monies (via valid BG's), developers will continue to employ delaying tactics to avoid swift return of monies in the hope that the clients will either run out of monies during the long process to complete their legal battle or will lose the will to live! (Sorry couldn't resist some humour). Scrupulous lawyers will continue to collude with developers by providing for example invalid BG's or none at all etc etc. As I understand it now, according to Maria the notary does no checks regarding these instances, or any legal follow through, so clients would still have to seek out good lawyers in the end anyway.

Changes are required to the legal system to solve such abuse , no matter which route you were to take under these circumstances, and those changes would prove beneficial for Spanish or foreign investors alike, no?

All of this applies to off-plan purchase and where I agree with Smiley is that this may well be the demise of such but in the meantime............... I rest my case!





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13 Aug 2009 5:34 PM by goodstich44 Star rating in northampton. 1648 posts Send private message

Smiley

I'm sorry, I just don't buy that. I don't believe the average spaniard would understand enough about legal issues to risk not using a lawyer. They would simply be taking a huge gamble that would be naive in the extreme.  Same answer to Gillespie, re: your example to me. Could you really take the word of any developer as being so genuine, you could go straight to the notary with him, trusting all the issues the notary doesn't cover are checked and verified by the said developer. You say he's honest, I want that verified by a good lawyer. Who is being naive?





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13 Aug 2009 5:47 PM by Gillespie Star rating in Costa Calida Area. 608 posts Send private message

Gillespie´s avatar

Goodstitch, you must remember that when notarising the off-plan purchase contract, that in the days leading up to the notary appointment, the notarys office will request a copy of the contract and the builders "legal pack", much in the same way they will draw a Nota Simple prior to the signing of a resale property.

The notary will not conclude the signing without a legal pack, just as they will not conclude the signing without a Nota Simple.



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13 Aug 2009 6:03 PM by goodstich44 Star rating in northampton. 1648 posts Send private message

Gillespie

yes, I see what you are saying, but if the notary is not required to check all details are in order as stated by Maria today, then surely you would leave yourself open to possible  (and being Spain quite probable) abuse by choosing not to use a lawyer?





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13 Aug 2009 6:15 PM by Gillespie Star rating in Costa Calida Area. 608 posts Send private message

Gillespie´s avatar

Whilst not wishing to be seen to disagree with Maria, I can only confirm that the Notarys in my area do insist on all the documents, they do read them out before the signing and they do ask the buyer "if they are happy to sign for an illegal property" with a wry smile on their face before they send you away with an unsigned contract.

This may vary in other provinces, but I doubt it very much.

A Notary is far too diligent to allow someone to sign for an illegal property, they would be Notorising a fraudulant act which would be not only suicidal to their career, but also the end of a pleasant standard of living.



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13 Aug 2009 6:54 PM by Smiley Star rating in San Pedro de Alcanta.... 2502 posts Send private message

Smiley´s avatar

OK Ken - forget the semantics - if Aifos (or A N OTHER) received a deposit whether it be via an agent (in most cases) or direct and they did not have licence to break ground then it was illegal. This is what was happening here on the CDS - I cannot speak for your neck of the woods - although I hear there is a large development in Murcia where on certain phases this may indeed have been the case (but it is only a supposition voiced to me at the moment and not confirmed).

Ads I would agree with you but until the Spanish legal system (slow even in good times) has a chance to catch up with the introduction of a system of home purchase that previously was completely alien to them but introduced by foreign bodies that protective legislation will not come about. Until the legislation is enforced (not simply introduced - somewhat like the Spanish smoking ban) that developers are required to fund the cost of the BG and that lawyers start acting like lawyers instead of administrators and that off plan investors/purchasers (assuming that part of the market survives) start adopting buyer beware and treading with caution (and please believe me everyone, I am not laying blame at the unsuspecting buyers feet) and not assuming their new best friend is telling the truth then the off plan market will be flawed - but then I have believed it always was!

Sorry Goodstictch but they do. This is a different country - the Notary is built into their life from the day they are born. If you want to borrow money for a car you go to Notary for it to be legalised, wills are recorded at Notary, I think I have even seen a sale of chickens at Notary. The Spanish trust the Notary far more than they would trust a lawyer. Similarly they dont trust estate agents - they generally buy direct or via the local (cant remember the official title but Ken will) bloke in the village who knows what and where is for sale. Neither do they trust the banks (possibly with just cause) - there is no system of Telegraphic Transfer here for house purchase - hence on completion day at Notary there is a series of bankers drafts to pay the various costs and developer, lawyer etc. SWIFT is in operation but on property purchase it is always cash itself or a bankers draft (except for the odd rare exception when a personal BG is used and funds transferred into a vendors account from a foreign country).

While a few (better off) Spaniards would retain the services of a lawyer most of them DIY. Possibly not many on this thread will know but it is recognised there is no conflict of interest for a lawyer to act on behalf of both buyer and seller in a house transaction - I have to say that is something I have always queried - who is he going to represent most when a conflict arises - the seller or the buyer??? Maybe thats why the Spanish generally dont bother.



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13 Aug 2009 6:57 PM by Smiley Star rating in San Pedro de Alcanta.... 2502 posts Send private message

Smiley´s avatar

Think the final remark about illegality might be a new one (ish) mate. Its the situation here now as well but in 99 I had a mate buy in Torrevieja - illegal construction and passed by the lawyer and Notary - that being said I agree with you that we are talking about the present and recent times and confirm the legal pack is correct.



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13 Aug 2009 6:58 PM by goodstich44 Star rating in northampton. 1648 posts Send private message

Gillespie

I think with due respect you are disagreeing with maria. We need to know, is it safe for anyone to buy without a lawyer or not?  If you are saying the notary is checking everything a lawyer would, therefore protecting your investment then fair enough, but that says Maria is wrong? 





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13 Aug 2009 7:14 PM by Gillespie Star rating in Costa Calida Area. 608 posts Send private message

Gillespie´s avatar

As I said in an earlier post on this thread goodstich, by introducing a lawyer, you are adding another level of beaurocracy/cost to the proceedings.

I am not saying don't use a lawyer, I am saying until clients began to ask for them, I and my early clients got along without a single hitch.

I will say there are some excellent, even brilliant official, certified Notary translators, when I took out my first mortgage, my translator was so disgusted with the interest rate that she cancelled the whole proceedings and took me to another bank ensuring I didn't have to pay €3500 employment protection fees and also reduced my payments by €100 per month.

I used her for all my clients and even paid for and funded her office, one of the best investments I ever made in Spain.

Lets look at another example. If you were to take out a will and not notorise it, the lawyers would enjoy a long and protracted legal battle for several years, whilst submitting spiralling legal bills on either side. If you notarise your will, it's an open and shut case.


 



This message was last edited by Gillespie on 13/08/2009.

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13 Aug 2009 7:50 PM by goodstich44 Star rating in northampton. 1648 posts Send private message

Gillespie

I would say according to maria's info' , people buying without using a lawyer or advising anyone to do so is at best being far more naive to what they are risking than probably anyone cheated by doing they could, doing homework and taking advice to use a good lawyer. Even taking advice from people like maria only works if those in system have integrity, and we know the answer to that one!  The alternative?, risk going it alone with the notary who we have learned is not obliged to protect all your interests.

It clearly doesn't work which is why so many have been cheated. Change is needed and fast, or as Suzanne says, EU funding corruption and  a hopeless justice sytem should and probably will be stopped.





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14 Aug 2009 7:43 AM by mariadecastro Star rating in Algeciras (Cadiz). 9402 posts Send private message

mariadecastro´s avatar

 Some ideas out of recent discussion: very interesting thoroughly.

- There IS conflict of interest for a lawyer to act on behalf of both buyer and seller in a house transaction.

- Notaries would pay a great role if they custodied funds along the conveyancing process.

- For a developer not to provide the required Bank Guarantee in an  off-plan purchase used to be a crime in the past. I think it was a major mistake to overturn this. 

- Bank needs to be liable of not issuing the corresponding Bank Guarantees for the money they are lending for off-plan purchases. As liable as developers should be: criminally. 

- Contract and Consumer protection is enforceable now.

- Off plan purchasers are, according to the Creditor´s meting Act, preferential in a procedure of creditor´s meeting. No much Case Law is still in placew regarding this, but it will come.

.


 



_______________________

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Lawyer

Director www.costaluzlawyers.es

El blog de Maria



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14 Aug 2009 10:01 AM by goodstich44 Star rating in northampton. 1648 posts Send private message

maria

thanks for that info' ,some intersting points. 

On your last point about Off plan purchasers getting preferential creditor treatment, that's good news indeed if implemented?  Will it help my case I wonder when its all sorted out in months/years?

Something I feel should be changed is the embargo rulings. I had an embargo agreed through the court, but the case was delayed for 12 months, and at the hearing ,the developer made a small offer before the court, but not in any way acceptable so the case went ahead and 4 months later we still await sentence and are not likely to get it until at least September.  The developer has now gone bust, but it seems wrong to me that my embargo is now useless through no fault of mine!  It's the courts that have ruined our embargo through their delay, so surely they should be responsible for the loss they have caused me?.





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14 Aug 2009 10:10 AM by ads Star rating. 4122 posts Send private message

Goodstitch your posting sounds like a common theme where the developer had been allowed to employ delaying tactics yet again! Plus the court delays are definately a major contributing factor to the eventual problem regarding swift recovery of monies, hence my suggestion for some enforceable timescale constraints to be placed upon both the developer and courts.

Thanks for your replies Maria.

 



This message was last edited by ads on 14/08/2009.



This message was last edited by ads on 14/08/2009.



This message was last edited by ads on 14/08/2009.



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14 Aug 2009 10:29 AM by goodstich44 Star rating in northampton. 1648 posts Send private message

ads

yes, what else could cause such a long delay when the courts were only to aware of the fact the developer was about to go under any day.  Clogged up court rooms is no excuse for a delay that long, and even if it was, how does that make it my fault?. Unless the courts admit they are to blame for rendering our embargo useless, they have clearly cheated me!

In cases where unreasonable delay by the court allows a company to go bust, then in any fair system, the cout should compensate with the loss they caused. Yet another clear example of being cheated by those who are trusted to provide justice!!  Without question this is at best very wrong, at worst, it's corruption from the so-called highest powers in the land, and as far as I can see leaves the victim with nowhere else to turn, with the exception of EU human rights?





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14 Aug 2009 10:32 AM by ads Star rating. 4122 posts Send private message

Absolutely Goodstitch. Until these abusive aspects are resolved it really is a case of buyer beware unfortunately.

By the way Maria, I don't know if you saw my point re your suggestion for increasing the opportunity for arbitration with the developer, lower down the thread, but I'll repeat it here:

Unfortunately arbitration has been used as a delaying tactic by some developers who have no intention to settle and have made false promises which at the last minute are dropped. For instance I understand that there have been cases where they offer to pay if the client renounces the legal costs and interest, only to find that the same developer appealed the court decision although it was its own porposal!!! How can you trust a developer's commitments? Surely better to demand the whole amount?

Do you have any suggestions to stamp out this abusive practice?


 



This message was last edited by ads on 14/08/2009.



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14 Aug 2009 11:01 AM by goodstich44 Star rating in northampton. 1648 posts Send private message

ads

buyer beware indeed. The message is ''don't buy'' until the justice system becomes one that can be trusted?  No amount of research, or homework can prepare you for being cheated by the courts.





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14 Aug 2009 11:22 AM by mariadecastro Star rating in Algeciras (Cadiz). 9402 posts Send private message

mariadecastro´s avatar

Goodstich:

In your case, if the developer has entered into creditor´s meeting  and if the payment they owe you is due to a refund or compensation obligation arising from  voluntary cancellation/ cancellation due to breach by the developer, you have got a top first class credit against the developer, whose claim possibilities are not restricted by the rules of the creditor´s meeting.

Good luck and please keep us posted.

Maria



_______________________

Maria L. de Castro, JD, MA

Lawyer

Director www.costaluzlawyers.es

El blog de Maria



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14 Aug 2009 11:29 AM by Suzie Star rating in England. 121 posts Send private message

Hello Goodstich,

It probably won't help you feel any better but AIFOS 'clients' aren't being treated any differently than many others.  Court delays are only adding to all our problems, particularly when developers go into Admin in the process.   I was talking to a lady recently who started litigation in 2006.  She's had two dates for her first hearing but the developer has postponed both times; I believe they are allowed to do this three times.  So, she is expecting that the next date set for 2010 will also be postponed.  You can imagine her anxiety, anger and frustration - and this is also a developer with criminal charges who still has this route legally available to him to stall as much as possible. 

When the developer's appeal comes up in my own case, it will be 22 months after I 'won'.  The Judge would not grant me an embargo in the meantime, & not a penny back so far.   The Law and Justice are often so very far apart.

Regards, Suzanne X

 





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14 Aug 2009 12:23 PM by goodstich44 Star rating in northampton. 1648 posts Send private message

maria

thanks for that reply. In theory it sounds like I should have a good position on the creditor list, but this doesn't excuse the courts for ruining my chance of real justice by delay tactics. I feel they are directly responsible for my embargo being useless and should compensate accordingly.

Suzie

so true.  It's sickening, and  just makes a mockery of those wronged by crooks. How anyone could defend a system so wrong defies belief. The laws are there, but what is the point of them if abused by the very people trusted to carry out justice?





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