18 Sep 2024 8:54 PM:

My question was a more generalised point Maria.

Given that the SC have adopted "an extremely restrictive and formalistic interpretation " in their rulings, does this mean that these rulings are now being applied as SC doctrine for all high court judiciary to adhere to?

Its difficult to comprehend how these SC rulings will impact outstanding claimants going forward, and the worry is that the Banks will now use these rulings in their ongoing legal defence to deny their legal responsibilities to effectively manage and safeguard monies according to Ley 57/68, preferring to make conveyancing lawyers and agents responsible.

It's becoming increasingly difficult to comprehend why the SC are taking the stance they appear to be taking, if it results in innocent purchasers being compromised in this way.

 

 In terms of comprehending the detail the following observations and questions remain....

The funding Banks presumably were legally bound according to Ley 57/68 to establish nominated developer accounts from the outset of their funding of the offplan development. Is this a correct assumption?
And these accounts in themselves would have provided the mechanism to ensure that all associated offplan purchasers deposits would be invested into these accounts and would thereby be safeguarded.

The developer nominated accounts by their creation would automatically  have established that these accounts related to offplan developments. So it's difficult to comprehend why the Banks are now suggesting they have no means of identifying which developer accounts are linked to offplan developments? 
 

Whose responsibility is it to identify where any offplan purchaser's deposit is to be effectively safeguarded? 

Is the sequence of events such that the Bank has the legal obligation to notify the conveyancing solicitor ( or agent) of the details ( I.e the nominated developer account) where all subsequent deposits are to be secured for any given offplan development?
How do deposited monies get flagged up by the Bank as being offplan deposits associated with any given developer? Have electronic transfers not had the detailed facility to cross reference offplan deposits in this regard?

Was this transfer mechanism (presumably devised by the Bank in the first place) not sufficiently robust to ensure that effective detail was in place to subsequently safeguard all deposited monies associated with offplan purchase ( to differentiate between general developer banking activity and specific offplan deposits?)

 

 

 

Thread: Bank´s liability on custody of off plan funds

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18 Sep 2024 10:41 AM:

Thank you Maria,

 

In layman’s terms….

 

Did the Bank in question provide the funding to the developer of the offplan development, and was that developer named in the purchase contract? 

 

Is it correct to say that the purpose of Ley 57/68 is to safeguard all purchasers’ deposited monies, such that in the event of developer breach of contract these monies remain protected?

 

Is it correct to say that from the outset, the Bank funding the developer of the offplan build would have been subjected to law Ley 57/68, and it would have been for them ( not the purchaser) to ensure that effective mechanisms were in place, such that all off plan purchasers’ deposited monies thereafter would be  safeguarded and placed into NOMINATED developer accounts?

 

Is it correct to surmise therefore that the burden of proof would appear to lie with the Bank, I.e. to prove that they HAD in full knowledge established nominated developer accounts linked to the offplan build, thus ensuring the required safeguarding mechanisms were being effectively managed and adhered to?

 

Is it correct to conclude that the Bank by its actions to date appears to be denying their safeguarding responsibilities ( with all that entails in the due diligence and management and acceptance of offplan deposited monies into their care), and are endeavouring to place the burden of proof onto the purchaser, which can only be interpreted as a callous disregard for a law intended to protect offplan purchasers’ inalienable rights?

 

Isn’t this conclusion by the SC ignoring the fact that the Banks’ safeguarding mechanisms and management thereafter, in place to protect have FAILED and thereby placed purchasers at undue risk? 

 

In effect it would appear that this SC ruling in favour of the Bank has inexplicably undermined the protective basis upon which Ley 57/68 was first formulated….. 

 

Is this too simplistic a conclusion to the management and safeguarding issue relating to Banks’ responsibilities that are now being challenged by this SC ruling?

 

Are the Bank exploiting loopholes which require closing once and for all, and doesn’t the SC have the power to rule and protect the rule of law from abuse with regard to an existing safeguarding law intended to make Banks fully accountable if their financial mismanagement is brought into question, as appears the case in this instance?

 

Is another appeal against this SC ruling allowed? If not, would this become the basis upon which the European Court could reevaluate their admission of an appeal?

Thread: Bank´s liability on custody of off plan funds

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17 Sep 2024 1:17 AM:

Thanks Maria.

But returning to Banks liabilities....

Could it be argued that whenever a Bank agrees to establish a subrogated mortgage system with promissory note systems in place for any developer building an offplan development, that this evidence in itself would be sufficient to establish that the Bank already had knowledge that associated developer accounts must be legally bound by guarantee law? And wouldn't this evidence in itself overide any suggestion that obstacles could prevent the Bank from knowing all associated developer accounts were linked to offplan purchase?

Could this be a legal route to countering the latest SC ruling?

Thread: Bank´s liability on custody of off plan funds

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16 Sep 2024 2:31 PM:

Dear Maria,

More questions I'm afraid....

Would this require a joint and several claim against the Bank and conveyancing lawyer? Would the claimant have to have already proved that the Bank were not able to be made accountable due to the latest SC ruling?

The point has previously been made however that no Spanish lawyer would be willing to do this, I.e. take action against another Spanish lawyer, so realistically how could this be implemented?

Would the claim in effect be against the conveyancing lawyer's legal indemnity insurance? And wouldn't this be counter claimed by the insurer as being part of the Banks liability? Catch 22 scenario with the claimant being exposed to yet more years ( and costs) whilst the liability issues remain unresolved?

So frustrating!

 

 

 

Thread: Bank´s liability on custody of off plan funds

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04 Sep 2024 1:02 AM:

Do you still have the pre-copy of the contract Deeleys?

It would be interesting to know from Maria where would this pre-copy of the contract stand in the eyes of the law? Would this be deemed sufficient evidence to prove the Bank's original obligation to act as guarantor? Or would timeframes of this nature now exclude any possibility to pursue the claim against the guarantor Bank anyway?

Well done nevertheless for your partial win Deeleys.
 

Also it would be interesting to know who would be deemed legally responsible ( under the NEW law relating to BGs ) if the conveyancing lawyer did not ensure that the building licence was made available prior to offplan deposit being made? 

This all begs the question where does due diligence and care on the part of the conveyancing lawyer lie in the eyes of the law in Spain with regard to adherence of all necessary documents being made available to protect the client under purchase contract law?

This is so confusing Maria, as does the latest SC ruling now imply that ultimately the conveyancing lawyer becomes legally responsible if they have not ensured all required documents associated with safe offplan purchase are not made available prior to contract signing?

Will all continuing claims against the Bank(s) in the event of developer breach ( those without links to subrogated developer mortgage and promissory notes, as proved partially successful in Deeleys case ) now be at risk following this latest SC judgement? Will they be left having to make claims against the original conveyancing lawyers as an element of last resort ( I.e. being denied the opportunity to claim against the Bank)? 

P.s. In terms of Banks lacking in EFFECTIVE regulatory structures and Bar Assiciations requirement to ensure adequate sanctions are in place to protect and enhance trust in the Spanish system of justice, it is useful to reflect on Maria's legal tip back in 2020, which endeavoured to educate those who continue to be rightfully concerned by outstanding exposure to risks and the need for a wider perspective to achieve mutually beneficial solutions going forward.

https://www.eyeonspain.com/blogs/costaluz/20442/legal-tip-1475--a-forum-conversation-on-banks-and-lawyers.aspx

This message was last edited by ads on 9/4/2024.

This message was last edited by ads on 9/4/2024.

 

This message was last edited by ads on 9/4/2024.
Thread: Bank´s liability on custody of off plan funds

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