A British expat has doggedly pushed a case through the Spanish courts to force a bank to return £1.3 million investors paid for off-plan homes that were never built.
Thousands of British property investors paid developers for off-plan homes at the height of the Spanish property bubble, only for the companies to go bust when the bottom fell out of the market.
Since then, property prices have plunged by up to 50% in some areas and are still falling.
Many Spanish towns and cities are scarred by swathes of unfinished, boarded up developments.
Keith Rule handed almost £46,000 as the first down payment on two villas due to be built on the luxurious Finca Parks development in Hellin – a two-hour drive inland from Benidorm. The plans were for an estate with more than 600 villas; many with pools, but only a handful were built.
Old law uncovered
The property company went into liquidation and the bank underwriting the development refused to repay the deposits to Rule and 46 other off-plan investors who had handed over £1.3 million in deposits.
Rather than accept the rebuff, Rule spent his time on his computer going through online Spanish legal archives and translating them into English with a Google program.
Eventually, he found a law from the 1960s that confirmed a bank was equally liable to repay guaranteed deposits on unfinished properties in Spain.
The case was pushed home through the courts, where Rule and the other investors won their case.
They are now going back to court to ask for costs and interest on their money.
Rule’s diligence and application impressed a firm of lawyers so much that they have offered him a part-time job.
Meanwhile, the case could open the floodgates for thousands of other investors who lost money to the Spanish banks and bankrupt developers who never completed homes for which they had taken deposits.
Landmark ruling
“Everyone said I was mad when I kicked this case off,” said Rule after the hearing.
“I’ve proved them all wrong and this case is now a landmark ruling that lawyers are picking up all over the country to help property buyers get their money back.”
The case has been through an initial hearing and an appeal by the bank, both won by Rule and his lawyers.
Now a second group of property buyers who lost money on the same development are preparing a case for court which they are likely to win.
“I can only assume the bank wish they had given me my money when I asked because this ruling is going to cost them and other Spanish banks millions. The judge has already ruled they broke the law by refusing to refund my money,” said Rule.
