Irish property investors to recoup cash lost in Spanish crash
Irish investors who lost millions in the Spanish property market crash are finally beginning to get their money back, after more than a decade of setbacks and legal wrangling.
A ruling by the Spanish supreme court in December 2015 paved the way for an estimated 60,000 Irish people to claim directly from the banks rather than property developers, most of whom were not worth pursuing as they had been declared bankrupt.
Last November, an elderly couple in Galway became the first Irish investors to win a case they took against the Spanish bank that took their deposit on an off-plan development in the Costa Del Sol. Final judgment was granted in January when the Spanish court awarded them their full deposit of €54,000, plus interest and costs.
A second case, which involved a man from Dublin, was due in court on January 23 but was settled by the bank four days before the hearing. Another six cases involving Irish investors have been won outright in the courts and those people can expect payment within weeks. Five more investors have received preliminary judgments in their favour.
According to investor Ollie Reel, who, along with his brother John, lost over €200,000 in an off-plan development, the Spanish banks are now beginning to settle cases.
The Reels are consultants for Reclaim in Spain, a Louth-based case handling agency they helped to establish, working with a lawyer in Spain.
“Between now and June there are another 30-plus Irish cases with hearing dates with combined losses of over €3m,” said Ollie.
“Our Spanish lawyer, Martin de la Herran, is confident of success in all of them.”
Reclaim in Spain is also handling almost 400 other cases which are at various stages of court proceedings.
“The average loss would be around €70,000, so the combined loss would be in the region of €25m plus.”
Reclaim in Spain works in tandem with a UK operation, The Claims Bureau, and its title reflects the fact that it is only banks in that country that are being held liable for lost deposits. This is due to a specific law introduced in 1968 during the dictatorship of General Franco.
The legislation was mostly forgotten until 2012 when Mr de la Herran and six of his colleagues sought to apply it to cases being taken by investors against developers.
In 2015, the Spanish Supreme Court ruled that the banks had an obligation to safeguard buyers’ deposits and stage payments lodged with them.
Both the Reels and their Spanish lawyer are confident many more Irish victims of the property crash will get their money back in the coming months.
“We also have another three cases which had hearing dates in the last few weeks and the judge has ruled in their favour in each case,” said Ollie. “They will also be paid in the coming weeks and will be receiving deposits back of approximately €99,000, €58,000 and €40,000 respectively.”