Real estate financing
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Non-existence of abuse when the IRPH clause is valid and transparent
The Supreme Court (TS) has ruled on a case of two consumers who signed in 2007 two mortgage loans with a financial institution. In both cases, the variable interest was calculated using the IRPH Cajas as the main index (and as a substitute index, the IRPH Entidades). In addition, the contracts included a late payment interest of 18%.
The clients sued the institution requesting, mainly, the nullity of the IRPH clauses (firstly for "defect in consent" and, subsidiarily, for "abuse" linked to the lack of transparency). In short, they argued that they had not contracted with sufficient information and that, therefore, that reference to the IRPH should be eliminated. They also requested the refund of amounts and, as an alternative, that the IRPH be replaced by the Euribor (without a spread, as they indicated).
In the first instance, the court did annul the clause annulled the clause IRPH clause IRPH clause Upon reaching the Supreme Court, the plaintiffs insisted that, according to the
European case law they referred to, if a clause like the IRPH is not transparent that should lead to considering it abusive abusive lack of transparency may be a requirement requirement is not sufficient on its own is not sufficient on its own significant imbalance significant imbalance contrary to good faith. Finally, the Supreme Court dismisses the appeal, upholds the validity of the IRPH clause.
If you are thinking of carrying out any operation or business that involves formalizing a real estate credit contract, our professionals can advise you on defending your interests-
Elevator maintenance
Nullity of duration clauses and excessive notice in successive contracts This case deals with a typical contract for “preventive maintenance” of elevators, which are not fulfilled in a single day, but are provided month by month (what is called in law a successive contract). A maintenance company sued a community of owners because it decided to terminate the contract before the agreed term expired. The company claimed two things, on one hand, that unpaid invoices were paid; and, on the other, compensation for “breaking” the contract early. The conflict revolved around two clauses of the contract where one set a duration of 3 years and the other required a notice of 180 days (six months) in advance if one wanted to terminate the contract. The community argued that these conditions were abusive in the case of a consumer (in this case, the community itself). In the first instance, the court ruled in favor of the company, ordering the community to pay both the compensation for early termination and the outstanding invoices (in addition to interest and costs). However, on appeal, the Provincial Court of Málaga changed the criterion, declaring the 3-year duration clause and the 180-day notice clause null and abusive. What is the practical consequence? If those clauses are invalid, the company cannot rely on them to demand a penalty or compensation for having terminated the contract early. Nevertheless, the community must pay what it actually owed, the outstanding invoices for services already rendered. The Supreme Court confirmed this outcome, the duration and notice clauses are considered null, no compensation is due for ending the contract early, and only unpaid invoices are owed.
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Urban leases
Does a reversible work by the tenant give the owner the right to terminate the contract?
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Urban Leases
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