Indebted Spanish home owners may get some relief

Posted on Posted in Property Law, Publications
The Court of Justice of the European Union(“ECJ”) in its judgment of 14 March 2013 (C-451/11), has determined the breach by the Spanish law of Directive 93/13/EEC of 5 April 1993, because, on the one hand, under the foreclosure proceedings the owners cannot submit to the Judge their reasons to object the eviction  based on the unfairness of a contractual terms that is the basis of the enforcement. They must start a diferent process to do so, but the judge hearing this new legal action, whose purpose is to assess the unfairness of the underlaying contract, cannot adopt any precautionary measures to ensure the full effectiveness of his final resolution. For instance, he is not entitled  to order  the suspension of foreclosure proceedings .
The ECJ judgment requires urgent changes to the rules on foreclosure in Spain, which could solve the serious problem today on evictions in our country. The new legislatation should allow home owners challenging the fairness of a loan agreement to request the Judge to suspend the foreclosure proceedings until resolution of the main action is taken.