- This topic has 55 replies, 16 voices, and was last updated 14 years, 9 months ago by
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Hi everyone – just seen this through a google alert. In light of a recent thread regarding illegal builds thought this is something you should know about. It isnt light reading and those of a nervous disposition should be seated first
Regards
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Well I never – this just came through – encouragiong signs indeed for those of you affected by illegal bilds. As I mentioned before estate agents have as much a duty to the client for the final product as the developers do. Looks like now someone is doing somethng about it. Feel sorry for those affected though.
“The Valencian Government yesterday announced that it was issuing embargo orders on all the bank accounts of all real estate promoters and builders in Catral in order to be able to compensate those people who acquired the 1,200 homes that were illegally built in the municipality and which led to the Valencian Government removing some powers from the Town Hall earlier this week. In announcing these measures, Esteban Gonzalez Pons, the Conseller for the Territory added that his department was setting up a specials independent investigative body to examine what had happened in Catral. The members of this body are expected to be named following a Valencian Cabinet meeting tomorrow.”
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Oh for God sake! bloody idiots.
I especially liked this part:
Expat Dennis Archer, who has bought a home near Catral with wife Pat, said: “Our house was finished on time and was very nicely built. “The problem our solicitors failed to notice was neither our home or the the others on the complex had planning permission.
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😯
Drakan, I’m glad you see this as a problem that the Gov’t should tackle as a priority. It’s something I’ve been harking on about for ages, that Spain’s Gov’t COULD and SHOULD prioritise issues regarding their often ‘corrupt’ property market, including proper regulation of the cowboy estate agents and developers that are still operating there, you know the ones I mean, and some lawyers too, those that always crop up on this site!
The industry needs ‘steam cleaning’ to regain it’s image.
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“You know what someone should do.
Stand infront of the realestate agencies stands at the airport and hand out a “do’s & don’ts for off-plan”, for those that actually want to buy”
So who will pay them to do it?
The developer, think not.
The agents, think not,
The lawyers, think not.
I think what should be done, is every purchaser be given a test to see if they have a brain or not. If they do, so be it, let them purchase and face the consequences if in the evnt things turn sour. -
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Hi Vince,
I know the area in Catral that is affected and I know people that have bought there (not from me) and have big problems. These people have come to exhibitions to speak to a solicitor that comes with us and offers a free legal clinic to get advice. Of those that have come, not one had used a solicitor in the first place and one couple have now had their house demolished.
The solicitor has had long discussions with the council in Elche but to no avail. It makes no difference about “life savings lost…no home….pensioners” etc etc. The council are determined to demolish and restore the area to its previous condition.
The problem with
“The Valencian Government yesterday announced that it was issuing embargo orders on all the bank accounts of all real estate promoters and builders in Catral in order to be able to compensate those people who acquired the 1,200 homes that were illegally built in the municipalit
is that many of these builders were very small and have either made a run for it or have nothing anyway. I know of two builders ( 1 english and 1 dutch) that have been held in custody but are now building in Almeria. I assume they have covered all this with limited companies or wives names etc to escape prosecution or compensation.
I think getting compensation from someone with nothing is going to be hard no matter how hard the council come down on these builders.
Best wishes
Bernard
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Hi Bernanrd – I agree with you that compensation will be at best difficult to obtain. My comments were mainly related to the fact that at least the government are starting to take a stand agianst such practices and this in turn may lead to more stringent controls prior to building (for example sending inspectors round to stop buildings without a licence)
What I find incredible is that in Oliva anyway, if you have a skip outside the house you can guarantee that within one hour the town hall will be round asking for your permissions. Yet major developments can apparently be undertaken in some areas without anyone noticing. I find this incredible. One rule for some and another for others.
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Hi Vince,
I quite agree with you that its about time to get these things under control.
I have the same situation in the area where I work. The council actively look for a piles of sand, bricks and skips outside a property and query what the owner is doing. In many cases they have been to properties and told the owners that, for example, they dont have a building licence for a pool or a wall extention.
The planing authority in my area is also Elche, the same as Catral!
How these builders managed to build there and not get noticed is a mystery to me.
Best wishes
Bernard
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@Paul wrote:
😯
Drakan, I’m glad you see this as a problem that the Gov’t should tackle as a priority. It’s something I’ve been harking on about for ages, that Spain’s Gov’t COULD and SHOULD prioritise issues regarding their often ‘corrupt’ property market, including proper regulation of the cowboy estate agents and developers that are still operating there, you know the ones I mean, and some lawyers too, those that always crop up on this site!
The industry needs ‘steam cleaning’ to regain it’s image.
There has been no misunderstanding Paul, don’t worry. 😉
I agree with you.
70% of problems would stop if REAs were regulated in Spain and those laws were correctly implemented and enforced. No use having laws that are not enforced. They are just wet paper.
Unfortunately the ex-ruling political party PP abolished these laws. The huge British REA which act along Spain’s coasts and spend fortunes on marketing are acting in a legal limbo because they are not regulated at all in Spain. There are no legal limitations to his activity and frankly the Government hasn’t been too keen either in regulating this, either PSOE or PP because they have their own vested interests in Spain’s economy. A 21 year old UK REA can be making even more money than a 47 year old lawyer. It’s that crazy but that’s how it is working now. A completely lawless sector unlike for us lawyers or other professionals. Free Market some would say.
They are not required to have professional indemnity insurance, they don’t need college degrees, they don’t need a Bar Association. Just sell, sell and sell.
The Government should clamp down on them (=the rogues) sooner or later by means of passing a law that regulates the sector. We’ll see how long this takes.
In my humble opinion I see many professionally run REA in Spain which are small to medium-sized that just cannot compete with brutal and unscrupulous market tactics of the large ones which do not abide by any law because there simply is no law to abide by currently.
Despite of all the above I think that REA are completely essential in the buying process in spain, only that they should be regulated like the rest of the parties involved in the process.
Anyway all the above is very discussible and very off the point, it’s just my personal opinion.
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From today’s online Telegraph re more affected buyers in Catral.
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“Even if we do get compensation, which I imagine will be a long and tiring process, we will only get the amount the house was valued at when it was built,”
Yet another warning about undervalueing.
In England everyone overvalues their property thus incurring massive rates then when in Spain,where rates are much lower ,the opposite applies .
Funny old world -
I have never sold illegal houses in the Catral/Dolores area, and I have tried to warn potential buyers via mywebsite, advertising in CBNews and Euro Weekly News, displaying newpaper articles in my office window in Almoradi, and of course, personal warnings to property seekers who contacted us.
This is not a buying off plan problem – the houses were built without planning permission in an area where at best a minimum of 10,000m2 was and still is required, and at worst no building whatsoever was allowed.
Quite simply,all that was required was sight of the planning permission or if still a plot, the Cedula Urbanistica which would have shown if building was allowed, the size and type of structure, and minimum size plot required.
Some people were totally duped by agents and solicitors, and those people should send full details to the EEAU (http://www.eeau.eu) who will at the very least blacklist the offenders, and if feasible, take legal action.
Unfortunately, many people chose to ignore our warnings and are now suffering the consequences.
Those within the El Hondo natural park area are almost certain to see their homes demolished, but most of the remainder will probably be legalised via an urbanisation plan which will bring the area up to standard with mains drains etc.The owners will have to pay for this, and possibly give up land for road widening etc. No doubt we’ll hear cries of “Land Grab” when that happens, but I’d like to put on record now that
THESE HOUSES ARE ILLEGAL AND SHOULD NOT BE THERE, AND THE ALTERNATIVES ARE URBANISATION OR DEMOLITION -
Sorry,but I have to make a comment about this as well.
Estate Agency was strictly regulated until 6 or 7 years ago. Only APIs could sell property,and they had to be Spanish as well as have qualifications. In response to EU pressure, the occupation was opened up to other professionals. The monopoly of the College of APIs failed partly on the argument that a person could sell their property without an intermediary, so it was illogical that only an Agente de la Propiedad Inmobiliaria (API) could introduce a buyer to him.
Unfortunately, we now see how wrong that theory is.
I understand that at the moment,new API members need a university degree in law or a subject related to property, and to take an internal examination. There are very few Brits who would be able to join. There are other professional associations which insist on members taking some sort of course (in Spanish).
Whilst honesty and integrity are the important “qualifications”, estate agents need training to enable them to exercise due diligence. The excuse “I didn’t know the houses were illegal – I just gave the papers to our/the solicitor” isn’t good enough. A professional should be able to spot a suspect property and investigate, and if he can’t, he shouldn’t be in business!
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Thanks for the reply Drakan, it explains very well what many of us think about the larger rogue agents often run by Brits who give the property business such a bad reputation in Spain.
If Spain would act quickly to regulate them (little chance I think), it would nip most of the problems in the bud. They should be just as guilty of the original mis-selling as the Developer is in most cases.
Why do you think the Gov’t there is slow to act? Is it because the revenues are too large to lose re taxes etc on property deals?
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Hi Paul
Responding to your comment
“They should be just as guilty of the original mis-selling as the Developer is in most cases”
I think you will find that (unless I am mistaken) an estate agent is just as liable as a developer for mis selling. In fact any party that is involved in the chain is as liable. Perhaps I am wrong but that is my understanding.
Regards
Vince
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I’m not sure, exactly,of what mis-selling is, but I do know that agents have been convicted in Spain for selling land/property making false claims as to their legality.
As I said on the EEAU post,I spent about four hours with the Telegraph reporter in Catral on Friday and although the owners of the houses almost all claimed not to know the houses were illegal, no-one would point the finger at the agent they bought through, or the solicitor!
I’m not sure why – we thought maybe they did know, but didn’t want to jeopordize any chance of compensation. Some must have known. Who knows why they are being so secretive? I really expected a flood of accusations! -
As I have rattled on about for the Marbella problems, Catral must be the same in that the only ones who did not know the building was illegal were the poor souls who bought both Spanish & foreign.
Nobody is going to convince me that lawyers, developers and estate agents did not know that Catral was illegally built. It’s in a nature reserve for Gawd’s sake. They did not want to derail the gravy train.
If you started knocking up houses in Hyde Park I think you might have a visit.
You should see the horror stories we receive of at the Costa del Sol Action Group. -
Many British purchasers are also to blame for what is going on in Spain, they are not all “poor souls”.
I’m sick and tired of explaining to clients not to purchase without a LFO or other basic legal requirements. Even so they insist and insist and keep on insisting that they want to complete despite me highlighting the illegality of some developments.
They will buy knowing very well that they are buying something illegal but they still hope Spain is different and that the laws here are more relaxed and that the Authorities will turn a blind eye on the illegality and after a couple of years their houses will be legalised…Would they behave like this, completely ignoring their UKs solicitor’s advise, buying in England I wonder ?
So it’s not only Estate Agents, developers and lawyers who are to blame here. Many, many, many UK and Irish clients push and push and keep on pushing us to complete despite us telling them not to do so or to wait for the LFO. Regardless of the advise they still go on ahead.
Curiously, in my experience the last person whom clients listen to is their spanish lawyer. Many think they know best … 🙄
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Drakan,
I have dealt with the general public all my life and people and media ,the world over, only ever tell the part of the story that suits them .
When one actually delves more deeply into a situation, which one should do in order to give the correct advice, it becomes clear that either they have been irresponsible or have been cleverly defrauded.
Unfortunately for many the former is the truth but getting to folk to admit they might be in anyway accountable for the predicament they are in is like getting blood out of a stone.
We all have the right to assume agents and lawyers will be honest but , in any financial arrangement, nothing should ever be left to chance. -
I don’t agree with what you are saying Drakan, They may be foolish but the blame still lies with the developers/agents etc. and manyof these people are losing their only home. There seems to be some perception here that people are investing with a bit of spare money they have hanging around but many sell everything to live the dream here.
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We are dealing with a case where the agents in Fuengirola in cahoots with the lawyer in Arroyo de la Miel they recommended sold a British couple a project of land plus house built. The lawyer assured them all was in order. There never was any planning permission or building licence and now a road is going through the property. 250,000 euros paid over for nothing. Total conspiracy to defraud and presumably the corporate vendor was in on it.
Our lawyers have now issued denuncias and are working to put a stop to the roadworks. It’s a nightmare and these people did absolutely nothing wrong except believe what ”professionals” they were paying told them. -
Actually that is debatable Katy. If the clients complete and they have previously signed a document by which they recognize they are buying without, for example, a LFO being granted against the legal advise of our law firm, they are held responsible and not us.
We duly warned them of the legal risks implied and they still insisted on completing on an illegal dwelling.
It is not about being foolish or not, it is about who is to be held responsible at a later date. If a client has acknowleged this on writing then it’s his problem for being so stuborn.
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For once Katy, I don’t agree with you ( 😉 xx ).
If Drakan so thoroughly and blatantly advises his clients not to purchase/complete because of illegalities, no LFO’s etc. and they insist to go ahead against his advice – then I do feel they only have themselves to blame. How I wish we had had that advice from our original lawyer three years ago.
On the other hand, for first time purchasers in Spain who have only had experience with their UK lawyers and therefore had no reason to question the honesty and integrity of their Spanish lawyer, I feel they are not to blame for assuming he/she is honest.
I have been with my English lawyer for over thirty years, and (obviously wrongly) thought all lawyers were as straight, honest and as decent as he is. Lawyers’ code of ethics and all that.But hindsight is a wonderful thing – and so is learning from experience.
I couldn’t imagine three years ago, before my buying-experience in Spain, that I would now be saying to people make sure your lawyer is totally independent because he may be corrupt and in cahoots with the developer.
So yes, if you go against your lawyer’s advice when warning you of the dangers – that is up to you.
But for the ‘newies’/first-time buyers in Spain who haven’t been exposed to what is going on, I don’t think they can be blamed at all for assuming their lawyer is honest and for putting their full trust in them.One soon learns, I did. But no-one has the gift of hindsight.
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Yes Draken, I agree that in these cases their legal representative is not responsible but not the concept that blame is shifted from the rogues. Being foolish does not mean that you deserve to lose your money.
Gwlymrj…The costa del action website is very useful. Speaking to a friend last year who said he had just deposited a cheque for over a million euros with one of the Advisors on the blacklist…told him to read the site and he managed to stop the cheque.
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Nonsense.
You pay money to your lawyer in the UK on the basis of his/her professionalism and qualification and would expect to do the same in any civilized country. He has been instructed as a professional knowing full well that you do not speak the language and you are paying him to guide you through the process.
Our lawyer thought it was as blatant a case of fraud as she had encountered. -
You stated “they were assured………..” .
It might well be a blatent fraud and if so hope they get hung drawn and quartered. It is just my opinion to what you wrote and in my book an “assurance” is not a good enough reason to hand over so much money to anyone anywhere.
For even a fraction of that amount of cash I would have insisted on the documents being seen by a third party of my choice.
Comprehending legal jargon in English is hard enough without the added disavantage of a foreign language.This isn’t hindesight but logic.
Obviously more to the case than has been stated if my posting is “nonsense”.
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Surely Melosine, one can only use logic in a situation if you are armed with knowledge and facts. We base our logic, and the ability to apply it, on what we have already heard, seen, learned and experienced in our lives.
Unfortunately many of us were first-time buyers in Spain, and had not at the time seen a forum like this one to learn from. As you know, many purchasers are retirees – and probably in their lifetime have only ever previously used their UK ‘family lawyer’ they’ve known and trusted for years.
Were we all naive to trust our Spanish lawyer?
Being ignorant of the facts, and not knowing what was going on in Spain – no.
Not using our ‘logic’ in this situation in my opinion is the wrong word…gwilymrj wrote:
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“You pay money to your lawyer in the UK on the basis of his/her professionalism and qualification and would expect to do the same in any civilized country. He has been instructed as a professional knowing full well that you do not speak the language and you are paying him to guide you through the process”.
unquote– thank you for posting some good plain commonsense.
That was exactly my ‘logic’ too back in 2003 – I didn’t think I needed to have a lawyer, any lawyer, double-checked as I had never in my life ever heard of a corrupt lawyer.Sadly many of us have learnt too late that your words do not necessarily apply ‘across the board’ in Spain.
Hindsight would have been a Godsend…… -
@Drakan wrote:
Many British purchasers are also to blame for what is going on in Spain, they are not all “poor souls”.
I’m sick and tired of explaining to clients not to purchase without a LFO or other basic legal requirements. Even so they insist and insist and keep on insisting that they want to complete despite me highlighting the illegality of some developments.
They will buy knowing very well that they are buying something illegal 🙄
Drakan,
Whilst I read many of your postings to the forum and try to understand most points of view, I do have a question..
I cannot help wondering –Why do you complete the purchase if you feel so strongly about the illegality.Surely it is the lawyers job to ONLY COMPLETE WHAT IS LEGAL ??
At least my ex-lawyers, ME, did advise NOT TO COMPLETE until the LFO was assigned to the development. ( They may well have fallen down in several other areas .)
Are you adding fuel to the fire or perhaps the account not being paid up is a worry ??
If lawyers explained what they WILL or WILL NOT do for their clients at the start of their client/lawyer contract then your problem would not arise.
I have no doubt that most lawyers provide an excellent service for us ” foriegners ” but a refusal to complete an illegal purchase would surely bring an insistent purchaser to their senses. After all they are liable to put at risk their hard earnt cash.. and that will hurt !!
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One can complete without a LFO Mr Dorrel and the property can be registered in the Land Registry under the name of the client, so it is legal.
Albeit it it is not correct. Because if a LFO has not been granted for a number of months or even years then there is a very serious planning issue or perhaps some other issue. The clients could have trouble at a later date because the propspective purchaser’s lawyer will refuse to buy if they had no LFO. Or else they might not be hooked up to the utilities. Or else…
So it is legal but professionally it is not correct. And for your information I have told clients to go and find some other lawyer if they kept on insisting in for example buying problematic rustic land which I refused to complete on.
I earn a salary, bonuses and perks, so I get paid just the same regardless if the client completes or not. I take no percentage -yet-.
Only this week I have two cases of such stubborn clients. Thre is no LFO yet, because the developers have just applied for it, not because there are illegal issues, and even so the clients are just not capable of waiting whatever it takes for it to be granted.
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Precisely Charlie,
Having read and heard about so many financial “scams” in England ,albeit not with lawyers, that caution would go into overdrive in another country if being persuaded to invest large sums of money with anyone
It is not that I think people are niave or gullible more so that the predators are very skilled in their art and slick operators.Therefore logic to me means not proceeding with any sale, even if it means losing out on a property, without first being allowed to have the contract checked out independantly.
Perhaps caution is my middle name .
Just my opinion -
Maybe that is exactly just the problem.
In the UK everyone has heard about dodgy estate agents/stories about their back-door dealings. And as for builders……It is just that no-one seems to hear about corrupt lawyers.
Am sure word will eventually soon get around as to what is happening in Spain, I just wish some naming/shaming and action could take place re. the (probably very few) rogue ones so they can’t continue without, it seems, immunity.
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I hope so as well.
If the predators , in any country, were faced with stiff sentences and fines then maybe the problems would deminish. This however is far from the case .
In many cases people don’t have the fortunate outcome you had albeit the stress and extra costs has not yet be accounted for.
Your problem started a few years ago when everything in Spain seemed legit.
Now cases of scams everywhere are highlighted constantly and on every medium so my problem is being unable to understand how folk can still get into predicaments.
Money is the root of all evil …. and it’s true….. whatever their occupation.In the meantime people have just got to be very cautious of anyone in a financial dealing ,anywhere, particularly when more than one “associate” is involved.
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@Drakan wrote:
One can complete without a LFO Mr Dorrel and the property can be registered in the Land Registry under the name of the client, so it is legal.
Albeit it it is not correct. Because if a LFO has not been granted for a number of months or even years then there is a very serious planning issue or perhaps some other issue. The clients could have trouble at a later date because the propspective purchaser’s lawyer will refuse to buy if they had no LFO. Or else they might not be hooked up to the utilities.
So it is legal but professionally it is not correct.
Draken
How can it be ¨legal¨ to complete on a property which does not meet all the legal requirements i.e. have planning permission?
I dont understand your explanation at all.
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I thought my post was clear.
You may complete and register a property under the name of the purchaser without there being a LFO granted. So it is legal to complete in such a way.
The point is that from a legal point of view it is not recommendable for all the reasons everyone already knows and that I have posted many times over in this forum.
One thing is if completing is illegal or not , which it isn’t, and a different matter being if the property has planning issues. 0K ?
An unprofessional lawyer with vested interests would say go ahed and complete. An independent lawyer would advise his client not to complete. And that is what I do. But some pesky clients are far too stubborn to heed my advise. In these cases they sign a document by which they fully acknowledge they are completing against the advise of my law firm (with a full written report). The responsability will be theres not ours.
I’m sure they would never do this back in the UK. Somehow they think they know best because “Spain is different”.
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@Drakan wrote:
One thing is if completing is illegal or not , which it isn’t, and a different matter being if the property has planning issues. 0K ?
.I’m sure they would never do this back in the UK.
Draken
I dont know what happens in the UK I am not English however
if what you say is correct that in Spain it is ¨ legal ¨ to complete on a property which is by definition ¨ illegal ¨ e.g. an illegal build, how can the buyer reasonably expect reparation in the future when he is the legal owner of an illegal property?Jude
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That is not my problem.
A client hires me to protect his interests. If I’m giving my professional advise in a full written report, plus emails, faxes, phone calls and even so he decides to complete as you may well understand I am not to be held responsible for that.
Perhaps nothing occurs and the LFO is granted months after without any problems.
Perhaps the technical survey from the town hall’s technicians decides that the development is illegal for whatever reason and they will not grant the LFO until the situation is rectified etc…
That’s a risk that the client assumes solo. He has been duly warned by us. It should have been a reasoned decision with all the legal facts at hand.
“reparation” is a different matter. What I’m talking here is that the client on doing this will not be able to point his finger at me and hold my law firm responsible should there be a problem later on. They were warned not to complete or to at least wait to do so.
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Drakan – there is one grey area that I am not absolutely clear on, it’s something pertinent to a development I know….
I’ve read that:
Utility companies are not permitted to supply homes before the Licence of First Occupation has been granted by the Town Hall.
Homes that have been hooked up to public utilities including water and electricity without this LFO is a clear violation of Spanish law.
Despite this law, we all know that utility connections are going on with new developments without LFO’s.However:
Town halls are obliged to issue the ‘cédula’ (LFO) before they allow homes to be occupied. It is this issue that prompts my question.Which is: If someone moves into their property (even though it has not been certified as ‘legally habitable’ by the Town Hall i.e. no LFO), where does the occupier legally stand if the developer goes bankrupt.?
If the developer built the development using bank loans, which they nearly all do, who would have the legal right over the property?
The bank because it was its collateral for the loan, or the purchaser because despite no LFO, he managed to register it in his name?And doesn’t this make a nice change from a question about Bank Guarantees 😉
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Ha ha ha ha. Yes its refreshing to be asked something different. One ends up being nackered replying the same questions all the time. 😉
No don’t worry Barbara, once the property is under your name at the Land Registry (after completion) it doesn’t matter if the developer goes bankrupt because the property is legally yours so there is no problem. The LFO has nothing to do with it.
The asset is only a collateral until completion at which moment the property is passed on to you legally.
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Well – that clears that one up!
That was an incredibly lucid reply from a lawyer…..I understood every word first time and didn’t have to re-read ten times. 😯
What’s happening Drakan – ??
(do you remember in the ‘old days’ you had to re-explain yourself three times minimum…).
Who’s improving – you or me? -
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Money! As I suspected Drakan, but I wonder who, if anybody, within Gov’t or legal circles or otherwise, is actually raising the issues there so that laws can change sooner rather than later, and rogues either booted out or sent to prison etc etc?
Vince, I totally agree that the mis-selling agents are as much to blame as the Developers re the ‘dodgy’ developments, the trouble is as we all know, they seem to go unpunished and are ‘still’ operating there after years of mis-selling often employing the same sales tactics, ie scamming the purchasers. Their after-sales service goes awol and they don’t want to know once they’ve sold and I wonder how many people actually get redress from the agent?
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