La Reserva de Marbella S.A. suffers another setback

February 12th, 2012

A recent Court judicial pronouncement by Court of First Instance 17 in Malaga tightens the noose on La Reserva de Marbella. Although the reading of the ruling can be tedious, save for if you are the claimant , the acting lawyers (us) or an avid reader of boring Court rulings, it is remarkable in that when typing up his conclusions the Judge, Mr. Antonio Valero González, has managed to extend the length of one sentence, with no full-stops, to…5 full pages (please help me find one (PDF))!!  The findings of the Court can be summed up as follows:

  • Older case law where a party was to be found deliberately obstructing fulfillment is now replaced by a less severe breach of contract: the standard now in off-plan property construction is one where the breach frustrates the legitimate aspirations of the buyers, preventing them from reaching the economical aims pursued.
  • La Reserva de Marbella S.A. obtained the license of occupancy on the 1st of June 2010, and on the 28th of October 2011 the Administrative Court 2 in Malaga ratified the right of the developer to retain the license, a ruling that is not firm. Mr. Valero points to the irrelevance of this item, given that termination was instigated well before.
  • High litigation activity on this development has meant that La Reserva de Marbella S.A. has created case law of its own, in the Malaga Courts. The judging magistrate concludes that an almost identical court case ruled on the 14.10.10 already deals with the issues surrounding the delay: lack of proper or legitimate planning compliance. Quoting the cited ruling, the magistrate delivers a fatal blow: it is clear that the defendant and seller is obliged to deliver a property in an able condition, to be used and lived in, being obliged to adapt the construction to current planning regulations to the extent that, if this is not in place, the property is not susceptible of being occupied and in fact, could even be demolished.
  • The sale of a property without an occupancy license represents a serious breach of contract, and property buyers are notforced to sustain the vicissitudes of an administrative nature i.e. build license, that was only achieved 5 years after completion was agreed to.
  • Counsel for La Reserva de Marbella S.A. argued, not without reason, that obtaning the license of occupancy was not instrumental in attaining full legal compliance, an allegation based on two Supreme Court rulings of the 10 of October of 1987 and 1989. Luckily, Magistrates at this very High Court in Madrid also get replaced and antiquated viewpoints also get replaced by more modern opinion (Supreme Court 24th of May 1991, 16th of March 1995, 28th of May 1996 and 23rd of October 1997).

Now straight on to the tricky stage of enforcing the ruling!

9 thoughts on “La Reserva de Marbella S.A. suffers another setback

  1. Amarjit Dohil UK

    Have the developer started to pay back money awarded to them by the courts or this going to another long drawn out exercise?

  2. antonio Post author

    Dear Amarjit, this will not be easy considering how La Reserva avoids paying winning consumers (a few represented by our firm but far more by other colleagues), which means that enforcement of the award is not an easy task.

    Also, there has been a recent ruling by the Administrative courts in Malaga that has found licenses granted by occupancy silence valid, from a legal point of view. This now means that property owners that want to now file against the developer will find it harder to succeed.

  3. Amarjit Dohil UK

    Antonio,

    We won our litigation (case started 2005) against this developer in May 2011 but they appealed the ruling? We waiting for the appeal courts. What does all mean now in light of the recent ruling?

  4. antonio Post author

    Amarjit, matters are in the air now as La Reserva de Marbella S.L. won a case with the administrative Courts in Malaga, in relation to the validity of the license of habitation.

    If you are waiting for a ruling, your lawyer should ideally be checking if the developer has submitted as new evidence such ruling, and contest it as he sees fit, in his professional judgement.

    If the Court of Appeal upholds your ruling, you will need to then enforce it.

  5. joy evans

    dear sir
    some years ago we placed a considerable deposit on a penthouse apatment at marbella de reserva (off plan) due to legal wranglings, the first occupancy license was not granted so we were not able to continue the purchase at that time. I know occupancy rights have now been granted but the developer is saying that completion did not go ahead because we failed to get a mortgage. We no longer wish to proceed as my husband and I have now separated. I am told by my husband that he employed a spanish lawyer who won the case but that the developer appealed. I have contacted the developer who state that they cannot comment because it is sub judice. As my husband and I are not in contact can you give me any update? 93,000 euros are involved.
    Joy Evans

    0i

  6. antonio Post author

    Dear Joy,

    I don’t understand the sub-iudice thing, this is only pertaining to criminal matters and only if the Judge orders it, so it is a load of rubbish more so in Spain, where leaks from judicial cases are commonplace. DIfferent thing is that them being the “enemy”, they would obviously not want to provide you with information relating to a Court case where you are the claimant. I would suggest trying to get in touch with the lawyer dealing with the matter.

  7. Angela

    i have won the case and then also the court appeal and now it is a matter of trying to get the money from the developer. has anyone actually managed to do this?

  8. antonio Post author

    Dear Angela,

    La Reserva de Marbella has chosen not to repay the sums that the Court has ordered them to return. On the contrary, they contend that they will go all the way to the European Court of Justice, we believe that to seek the justice that Spanish Courts understand has already been delivered.

    That said, enforcement of the ruling is now the name of the game and different firms are using varied strategies: registering liens on property, bank accounts, rental income from apartments they own etc.

    If you wish to join the group we represent kindly advise.

  9. Angela

    Thank you for your reply. As I understand it, it seems that the European Court of Justice only accepts questions from national courts and not from individual parties so how can they appeal to the European Court of Justice?

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