European Court of Justice rules Spanish Eviction Laws are illegal
lawyers in spain

The European Court of Justice ruled last March 14th, that property repossession laws in Spain violate European Union laws on consumer protection. Also stating that the Spanish legislation infringes EU law as it does not allow courts to halt eviction orders on the basis of possible unfair terms in mortgage agreements. until the case around the lawfulness of the mortgage is solved. This court ruling will oblige Spain to amend its law and will also be taken into account by judges handling eviction cases.
Over 350,000 citizens have received eviction orders since 2008 because they were unable to make mortgage payments, although in the majority of cases in accordance to Spanish law they were obliged to continue paying after their property was taken away, as the debt follows the debtor until the whole owed amount is paid.

This ruling protects consumer rights.

A summary of the Luxembourg court´s main criticism to the Spanish foreclosure system:

  • in practice the debtor can only challenge an eviction if the creditor has miscalculated the owed amounts;
  • judges cannot stay an eviction in cases involving alleged abusive lending;
  • The Spanish law offers less consumer protection than European Union law;
  • the judge can only find a contract abusive once the eviction has already taken place, and only a limited compensation is provided to the debtor by the law;
  • With the application of EU laws, the judges will be able to consider abusive “unbalanced” clauses that have not been individually negotiated, while with the spanish law, the “good faith” of the lender is assumed
  • The Court considers disproportionate the current regulation which allows the lender to demand the payment of the entire outstanding principal as soon as there is one missed payment.

Ada Colau, a spokeswoman for the Stop Evictions platform that has worked doggedly to halt evictions across the country, welcomed the ruling and stated

“We are very happy with the news because it’s a clear show of support for what we have been demanding and denouncing for the past four years, that the procedure is illegal and violates fundamental rights,” . She also recognized that the government “has no other option now” but to make amendments.

It was Judge Jose Maria Fernandez Seijo who sought the European tribunal’s opinion on an eviction case taken by a bank against a man from Morroco who was unable to pay off the balance of a €138,000 mortgage.

Fernandez Seijo said the European Court ruling gives “judges a much more powerful tool” with which they could at least suspend evictions.

The Luxembourg court decision, still, did not deal with one of the main request by anti-eviction lobbyists, which is for an insolvency law that would allow those who have defaulted on their mortgages to simply hand over the keys to their homes as they do in countries such as the United States, freeing them from mortgage debt.

Spain is one of the only countries in Europe which has such laws.

If you are a victim of an unlawful eviction process or have been notified that you will soon be evicted, call our office and talk to one of our expert lawyers. Make sure you have a strong defense against the bank.

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