August 29, 2006 at 5:25 pm #52172
My contract prepared by my lawyers says that
“delivery of the property is due by the 30th October 2006”
Then it adds
“Penalties for the developer: In case Arenal does not fulfill it’s obligation of delvering the property on the closing date,the buyer may opt between a.) making the developer to deliver the property or b.) cancelling the purchase contract and claiming for the refund of the sums already paid plus 10% legal interest.
Can I ask any of our legal experts if they think this agreement will stand and if, to use a silly example, Arenal could not deliver the property by 1st November then the action in b.) above could be taken….or do they, the developers ,have some leeway regarding delivery/completion dates.
Does “delivery of the property” mean that it is completer AND has a habitation licence or merely that the building is completed.
I hope these questions do not seem silly to our experts but probably a lot of contributors would be interested in the answers
Thanks a lot for your attention so far.
August 30, 2006 at 7:45 am #65299
In answer to your question, what is on your contract is enforceable.
By saying that you can force the developer to deliver the property I think they are paraphrasing the legislation (Ley 57/1968). What they mean is that you can grant an extension (as an additional clause in the contract) to give the developer extra time to deliver and finish the property.
As for opting to cancel the contract and get monies refunded with a 10% interest this can also be done. However, I am not so sure that the developers would be willing to comply with the clause without going to court! 😉
Usually, courts grant a ‘grace’ period of 2-3 months to developers from the deadline mentioned in contracts. For instance, in your case, if the property is not ready by October 31, 2006 and you decide to go to court then the judges would consider the legal action ‘premature’. I am pretty sure that our legal eagles will clarify this fine ‘unwritten’ legal point.
A new property is considered to be ready for escriturar when it has the Licence of First Occupation (Cedula de Habitalidad/Licencia de Primera Ocupacion). Some developers are saying that if it has the certificate of end of works (Certificado de fin de obras) then the property is finished. It is not so. It may be finished structurally but without the LFO it is not legal for habitation! And without an LFO you cannot get connected to services (water, electricity etc). Also, do not accept an LFO that the developers say they got by administrative silence. Follow the threads on LFOs for more info on the subject.
Anyway, if I were you I would be very careful with Arenal. see excerpts of articles from spanish papers on Arenal and illegal developments:
Las 82 promociones que siguieron su curso, pese a la paralización del TSJA, fueron denunciadas por desobediencia en una primera demanda, que afectaba a 37 promociones, y en una segunda, que implicaba a las restantes 45. “El número de empresas denunciadas es sensiblemente menor al de 82, ya que algunas fueron muy activas y reincidieron. Otras muchas, en cambio, son filiales creadas ‘ad hoc’ para entrar en el menudeo”, afirma Javier de Luis, representante de Ecologistas en Acción Marbella, asociación que ha presentado una de las denuncias. Otras firmas denunciadas, de menos nombre que las anteriores, son Ávilas Rojas, POVISA (de un concejal del GIL), Construcciones Salamanca (de capital ruso), Arenal 2000, Obarinsa, Renta 95, Nuevos Aires 2002, Nesgar, etcétera.
Las Maravillas de Elviria, promoción de la empresa Arenal 2000 en la zona marbellí que le da nombre, está paralizada. Dos grúas y gigantescos socavones muestran lo que iban a ser 363 apartamentos y áticos de lujo que se vendían a entre 297.000 y 369.000 euros. “Toda Marbella está parada. Sólo puede reservar si entrega la fianza a un abogado ajeno a nuestra empresa”, explica la vendedora. “Nos ha afectado como a muchos otros”, señala Miguel Navarro, secretario de la empresa en Córdoba.
The social impact of this second part of the investigation has been just as great as the first, not just because of the former councillors involved, but also because of the big names in construction now behind bars. The chairman of Arenal 2000, Rafael Gómez Sánchez, originally from Cordoba, has made a name for himself on the Costa del Sol through a number of developments as well as his purchase of Tivoli World and the construction of the Xanit hospital in Benalmádena. The man who started out as a goatherd and now owns a mansion in the style of the White House, appeared before the media in May to stress that he had never laid a single brick in Marbella and only played poker with Roca.
August 30, 2006 at 10:28 am #65301
Oliver – In case you don’t know about it, if you click below – you’ll see a huge thread going on about your development on the manilvalife forum (no disrespect, Mark 😉 )
August 30, 2006 at 12:26 pm #65305
Thank you Charlie and Katarina for your words of wisdom.
I do follow proceedings on Manilvalife and also contribute to it but unless I have missed it (and thats highly likely) I have not seen anything that answers my questions
Thanks again > Most welcome
August 31, 2006 at 10:52 pm #65383
Hi I was told by my solicitor that the clause could be invoked if they do not deliver on the day on the contract.
I did see a web posting of a letter to Arenal Golf customers (from a year or two ago), it was advising of late completion and offering the option to dissolve contracts in the manner of this clause – I’ve had a search but can’t find it now. I think that delay was 8 months or so though.
Be interested to see an opinion from one of the legal experts.
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