The Supreme Court: Civil Section: Ruled on the return of the advance payment for the purchase of housing for urban causes

Recently, the Civil Chamber of the Supreme Court extends the risk covered by the guarantee on payments made to the developer and establishes that a home buyer can recover the deposit given to the promoter, if the contract is cancelled for having hidden the seller planning irregularities.

The recent judgment of the First Chamber of the Supreme Court has set a doctrine that “legal guarantees of advance payments for purchase of housing governing law 57/1968 and additional provision of the LOE extend to cases in which the contract purchase does not come to fruition, by invalidating declared invalid for lack of consent to have hidden the promoter-seller to the buyer the existence of defects in the construction of urban nature. “

It also indicates that: sic: “the existence of urban illegalities can not be regarded as something beyond the scope of Law 57/1968, as it is closely related to the obligation of the promoter-selling start and deliver housing, meeting the physical and legal conditions to be inhabited without fear of future and frustration of expectations, which is the object of the contract “.

Initiated the case before it is due to this judgment, brought before a court of First Instance of Seville, it annulled the contract and ordered the seller to refund the advance payments, and pay a certain amount of euros, claimed for damages but rejected the responsibility of the insurer to understand that in this case was first occupation license, guarantees issued by the insurer or guarantor were cancelled, according to Article 4 of Law 57/1968. This article states that “the certificate of occupancy issued by the Provincial Delegation of the Ministry of Housing and accredited by the developer housing delivery to the buyer, the guarantees provided by the insurer or guarantor will be cancelled”.

The Provincial Court of Seville, confirming the aforementioned ruling of the Court of First Instance of that capital confirmed that ruling, arguing that the circumstances of this case is not foreseen in the law 57/1968, “which would only cover from booting or ended construction, delay in delivery or lack of license of first occupation. “

By contrast, the new judgment of the Supreme Court considers the appeal brought by the company concerned, and demanding, and condemns the insurance company, thus departing from both the ruling of the Provincial Court of Seville, as dictated by the instance court, which acquitted the only appreciate the responsibility of the promoter-seller.

The discussion focused on determining how far reaches the risk covered by the guarantee provided by law 57/1968 on advance perceive quantities in the construction and sale of homes, in cases where the sales contract is cancelled, because not attributable to the buyer.

The judgment shows that there are provincial courts that consider the guarantee in this law only covers the lack of start or completion of construction of housing and ancillary administrative obtaining licenses to be delivered and used as such. Conversely, another group of judgments, cited by the appellant, admit other events of default other than above: when the house comes in currencies other than the agreed conditions, with a mortgage burden exceeds the amount of the outstanding subscription price, when delivered with an embargo for a construction company, when there was no effective delivery it has been sold to a third party. Another assumption is that equates lack of physical delivery of housing to their lack of legal delivery, for the purposes of the law 57/68, when he attends an urban problem, as in this case, which involves the demolition of homes.

Given the disparity of criteria of the Provincial Courts, as left said, the Supreme Court, feel the new approach on the matter and determined that: sic: “the obligation of delivery by the seller presents two aspects: physical or material, consistent in putting in possession of properties that can be understood cases produced by the granting of the public deed; and other legal, which refers to compliance with those conditions is guaranteed for legal and peaceful possession of the thing to the buyer “.

The judgment indicates that what is important for the buyer is that: sic “the delivery of housing occurs when the property is able to be enjoyed by purpose,” adding irrefutably that “the obligation of the seller to deliver housing It is “the delivery of those in a position to be inhabited no legal impediment, making possible its occupation in a definitive way without obstacles or administrative or urban obstacles”.

Therefore I is established by this judgment of TS: sic, “the seller responds not only the delivery of housing, but also to perform it with useful for their own destiny, or what is the same, with the condition of habitability” .

The judgment of the fact that there was a “certain and serious danger” demolition of housing, based on previous final judgment, so the above situation, you could not ignore, with the modification of the Municipal General Plan had been cancelled, and thus establishes the Supreme Court that: sic: “so essential is the error caused by the concealment that made the promoter-seller to the buyer of urban illegality, which has led to the rescission of the contract by defect in consent, so it is clear that the contract has not come to fruition because the physical delivery of housing to be completed was feasible, but it suffered from legal conditions that would ensure the peaceful use of future, without fear or startle by urban illegalities “.

To finally determine the sentence to the insurance company, the Supreme Court stated that: sic, “if it had fulfilled its obligations, (the insurance company), among which is the delivery of a skillful housing for your destination by being covered with the planning regulations, “it would have been detected, being professionals in the field, urbanistic difficulties that existed when concluded the insurance.” Consequently, it is precisely because of this lack of “diligence” by which the developer is condemned to return to the buyer the amounts paid on account of the price of the house plus interest collected on demand.

Our office has filed lawsuits, successfully, in this regard, and in one case, class action, which was upheld at first instance and is, at present, pending judgment on appeal, but certainly being a similar case which gave rise to this important new Supreme Court ruling, we will be very useful, if we had to appeal to the Supreme Court on appeal.

If you are facing similar situations, do not hesitate to contact our office where we will custom and professional way in solving your case.

Saenz & Associates, Attorneys.

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