Breach of Contract - Off Plan Success Story

Published on 10/13/2009 in Buying Process

Like many people in the UK, we were excited about pursuing the dream of having our own property in Spain.

We had spent time looking at various places along Spanish coastline and decided on the Costa del Sol in Puerto Duquesa, near Estepona.  Having looked at old property and new, we decided to buy off plan, a 2 bedroom, 2 bathroom apartment on the sea front, within walking distance to restaurants and bars.

The Builder was well known in the area and we were comfortable and happy with their other finished developments. The materials were high quality and the finish luxurious. The plans looked superb, and we'd asked many questions along the way. We knew we had a 2 year wait for completion, but we felt it would be worth it.

Spain constructionWe visited the site regularly during the build phase.  But each visit we were refused access to the shell of the building (the reasons for this were cited as being a health and safety issue). We also met with the Developer on these visits to ask questions that seemed to keep arising. Each visit something in the build had changed.  We quickly realised that this was the way of Spanish Builders and we were just told to accept these changes.

However, some of these changes were fast becoming quite critical. There was now only 1 pool, not 2. The scale on our diagrams was misleading and when accurately checked, we were amazed to find some of the internal rooms were now much smaller than we had been led to believe, and quite frankly unusable in some cases. The pool area was in the shade, we could go on, but this sets the scene.  The questions we now had were either being dismissed or skirted around.

Our trust and excitement were quickly waning. The cost of this apartment was more than our home in the UK, so not an insignificant amount of money. We were beginning to realise that not only would we not want to holiday in this apartment ourselves as it really wasn't fit for purpose, our hopes of renting this luxurious, quality apartment out were dashed when we spoke to a local rental company who said they wouldn't even take the apartment on for rent.

The comments I received when pressing the rental company for a direct answer were. "Really nicely finished apartments with lots of gadgets; but very cramped, with little or no view, or sun. They will be unrentable because people would be disappointed with the rental and would never return". To add to that the rental company told me that there were some serious design flaws, and stated that in the winter months the heavily shaded pool area would receive very little sun.

Clearly this was a devastating revelation. We realized that we had been kept out of the apartment block specifically to stop us appreciating the actual size and aspect of the apartment. I was suspicious of the developer's reasons for keeping us out of the building, as we had visited lots of other building sites with this company and others; but had never had an issue gaining access. Now our nightmare was really starting to come together!

The stress this was now causing us was terrible. Sleepless nights, worrying about financing the purchase of something that was not what was sold to us was hard to stand. We thought we were trapped and had decided that we were probably better to walk away from our 140k + deposit rather than taking on such a terrible property. We could not believe how we could have been so naīve.

We strongly felt the Developer was in breach of their contract on a number of issues, however discussions with our existing lawyers left us feeling flat and that this was an almost impossible task in Spain. That would cost us the earth to do anything about. Lots of protocol, the law was complicated and rarely did a customer take a Developer on in this way. In other words, give up.

Given the technical inaccuracies of the build, we thought we'd try one last avenue and decided to seek the help of a British surveyor who worked in Spain. This was extremely useful as they thought our case was strong and passed on the name of a number of solicitors but one name, a Consumer Rights Specialist in Algecerias Maria Del Castro; sounded just the ticket.

Maria del Castro is a family business Costaluzlawyers  thier web site:  and they do much of the work without even meeting with their clients. This made it extremely easy to do business as it saved us countless trips to their offices in Spain, but not only that their charges were very competitive anyway. They were much cheaper than our previous solicitors.

During one of our visits to the Spain, we met with Maria at their offices in Algeciras. She understood immediately the problems we faced. She had vast experience in matters just like ours and her knowledge of consumer law was phenomenal. Her English language was good, which made life very easy for us.  Whilst we knew there was risk, she did very firmly believe we had a case for breach of contract. She also informed us that we had a bank guarantee that may be exercisable if the developer was late with obtaining the occupation license.

This bank Guarantee was an insurance policy put in place to protect our money in case the builder should go out of business before finishing the project. It was the one smart thing we did, we insisted on that being in place.  It also had an expiry date and conditions requiring the builder to meet there completion deadline. This gave us an automatic right to break the contract if they were late.

Once we'd instructed Maria to act on our behalf, a weight was lifted from our shoulders. She was tenacious, reliable and delivered on all her promises. She was a positive force; and a force to be reckoned with if you were the Developer!

A year later, the developer missed their promised completion deadline. Maria executed our bank guarantee in a timely fashion and was able to return all our deposit back to us.  Maria had to take the developer/ insurance company to court to force them to pay us the monies.  And ultimately we expect to get back our legal costs and interest. So we were very foolish and eventually lucky.

We learnt some very valuable lessons. We committed many of the sins:

  • Don't assume you have the same rights in Spain as you do in the UK.
  • If you buy off plan, inspect the site very carefully. Check the height of the structure, the Sun position throughout the day etc.
  • Only buy off plan when the structure is built, and you can clearly see and measure what you're buying.
  • Never buy on holiday, go back, sleep on it for a week when back home then review your decision so you don't make a big mistake.
  • Don't pay too much; so many properties were overvalued for what you get.
  • Always insist on a bank Guarantee, it should help keep your developer on his toes. If they go bust you will get your money back.
  • Use a good solicitor; I would without doubt recommend Maria Del Castro to anybody buying in Spain. No Matter where we purchase in Spain, we will use Maria in future.
  • Never rush in; the English sales people that the developers often use to gain your trust are desperate to sell to you. Don't trust them; make up your own mind.
  • Make sure that you can break the contract for an agreed sum, so if they ultimately make a hash of the project or change things in a way you can't live with, you can walk away without loosing too much money.  Get their contracts checked by Maria with the cancellation terms clearly stated and agreed!

We would never have been able to work the Spanish Legal system in this way. We would have been unaware of our rights. Maria del Castro and her team made this complex process uneventful and hassle free for us as is possible.

Best of luck

Written by: Emma & Simon Dart

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normansands said:
Friday, November 6, 2009 @ 11:37 AM

Great Stuff,
extremely well explained
cannot agree that you were foolish in not knowing in advance the tricks that even the "good" developers play or how crooked the lawyers are.
Well done Maria

******** said:
Tuesday, October 13, 2009 @ 6:20 PM

Dear Emma and Simon

I am so pleased for you. You were very lucky to be referred to such a good lawyer as Maria. She is unstinting in her help for anyone that asks. I just wish I had come across her earlier. Our purchase caused us years and years of stress and heartache. Our lawyer was independent but useless. If only there were more Maria's !

Congratulations on your win.


Surveyor said:
Tuesday, October 13, 2009 @ 5:23 PM

Dear Emma and Simon,

As the RICS Surveyor who referred you to Maria, I'm delighted, but not altogether surprised that she was such a force for your benefit.

Campbell D Ferguson

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