There are many ways to acquire property in Spain, and not all of them involve paying in exchange for ownership! Solicitor Raymundo Larraín Nesbitt explains.
By Raymundo Larraín Nesbitt
Lawyer – Abogado
8th of September 2011
You may have heard recently in the news the anecdote on how a homeless acquired, without compensation, a million dollar McMansion in the US through an obscure and long-forgotten law known as “Adverse Possession”.
This legal figure sinks its roots deeply in Roman law and is known as “usucapio”. The Spanish Civil Code knows it as “usucapion”, or “Prescripción Adquisitiva”, and is ruled in arts 1.930 et seq. Usucapio is a perfectly acceptable way of acquiring property in Spain with the same legal validity as, say, an exchange of contracts before a Notary Public. Adverse possession can also be found in England and Wales’ laws.
The purpose of this article is to divulge adverse possession, giving a sweeping overview on how it works in Spain. I will purposely cut out complex technicalities which are of interest to no one, except us lawyers.
Adverse possession is the legal procedure whereby title to another’s real property or royal rights are acquired, without compensation, by holding the property for a statutory time period.
In Roman times, ongoing wars were taxing on population and frequently land and farms were left abandoned after their owners perished on the onslaught. The Roman Empire, ever expanding, ever hungry, could not afford fertile land sitting empty without anyone laboring it. Usucapio was the jurisconsults’ answer to this riddle. Romans, ever pragmatic, devised a legal figure whereby citizens could, after a stipulated period of time had elapsed, take full ownership of these derelict lands to work them and make them productive once again for the good of the Empire.
Fast-forward a couple of millennia and we are in the midst of a post real estate bubble. We are witnessing how entire developments, tallying hundreds if not thousands of units, are sitting empty in countries such as Ireland, USA, Spain and worst of all in China as a testimony to Man’s folly. Shrewd opportunists are taking advantage of this legal figure to gain ownership on some of these units (mind you, I wouldn’t risk trying it in China).
Before you fret, picturing hordes of unemployed workers crawling over you Spanish overseas villa walls to break in and ransack it, Hannibal ad portas scenario, let me reassure you by telling you that this procedure in Spain is far from easy and normally spans decades to take effective ownership of the property (and this normally must be unchallenged to top it off). But you do risk losing material and legal possession of a property in the interim whilst the case is being heard at court, which may take quite a few years, bearing in mind how clogged Spanish law courts are as of late.
To further understand this I am forced to previously explain what are meant by “good faith” and “just title”. The former is when you acquire real property from someone you believe is the rightful owner, whether true or not. By just title is understood the legal procedure of handing over a property in a legitimate manner. Good faith is always presumed albeit just title is not and must be proved i.e. farmer selling you unregistered rustic land or a beneficiary inheriting it.
1. Movable property
i) With good faith, it’s 3 years. Possession of movable assets with good faith is equivalent to just title. i.e. someone selling you a bicycle.
ii) Without good faith, it’s 6 years. This possession must be uninterrupted.
Example, let’s say you borrowed, not stole, your neighbours’ lawn mower and have used it thereafter, unmolested, for the following six years. After this time limit you have become the rightful owner to it.
2. Immovable property (Real Estate)
i) With good faith and just title, 10 years if the owner lives nearby.
ii) With good faith and just title, 20 years if the owner is absent. By absent it is understood the owner lives abroad or overseas.
iii) Without good faith and just title, regardless of whether the owner lives nearby or is absent, 30 years.
With over a million properties standing empty in Spain, national unemployment (youth unemployment worst of all) soaring to unprecedented new levels, credit shut off, looming bank repossessions set at all-time record-highs, increase in taxes, the combination is ripe to leave the door ajar for social unrest to slip in. Some may take advantage of adverse possession (or even go further, starting social riots as has been the case of England).
Adverse possession is one of many legal ways to acquire title in Spain. Remember that squatters in Spain also have legal rights, which often involves having to fight them off at court. Do not take law onto your own hands. Always seek legal advice if you believe you’ve fallen victim to it.
“Possession is nine-tenths of the law”. Scottish expression
“Possession isn’t nine-tenths of the law. It’s nine-tenths of the problem” – John Lennon. Outstanding English musician, singer and songwriter.
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2011 © Raymundo Larraín Nesbitt. All rights reserved.