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Home > Legal Practise > Can Communities of Owners Chase Unpaid Fees Through Foreign Courts?

Can Communities of Owners Chase Unpaid Fees Through Foreign Courts?

December 19th, 2014

Some days back, an interesting legal matter was raised by a customer who had received, in his Liverpool home letterbox, a letter from UK-based solicitors demanding payment of unpaid “Community Fees”, on behalf of the administrators of a Fuengirola Urbanization.

On reading the content of it, it was clear that the 2nd class-delivered letter raised an important legal question: Can a Spanish Community of Owners legally pursue such debts through any EU-Court?

One of such law firms seemed to have to answer to this:

[…] Where defaulting owners are resident in the UK or Ireland, we avoid the delays and difficulties described above by recovering the debt directly in an owner’s country of residence.  This we do by relying on the European rules permitting debt to be recovered throughout the European Union, no matter where that debt was generated within the European Union.

European rules referred to by the debt-recover firm are none other than the REGULATION (EC) 1896/2006 CREATING A EUROPEAN ORDER FOR PAYMENT PROCEDURE, and the lawyers would have invoked article 2, which says:

[…] This Regulation shall apply to civil and commercial matters in cross-border cases, whatever the nature of the court or tribunal. It shall not extend to…claim arising from non-contractual obligations, unless…they relate to liquidated debts arising from joint ownership of property.

A simple answer to a fairly simple question then? So we thought until Spanish Judges got involved to upset the EU consensus in a recent seminar held on the matter. Out of the 8 participating magistrates, only one accepted that both the Spanish and EU debt recovery procedures can coexist and therefore, be alternatively used by Communities of Owners. The dissenting judges argued that, although the EU Regulation specifically deals with this, Spanish laws and tribunals should take precedence inasmuch as:

i)                    The debt is classified as “ob rem” i.e. attached to a property, thus necessarily connecting the matter to the local Court where the dwelling is located in.

ii)                   According to art. 9 of the Horizontal Property Act, all owners are obliged to designate a Spanish address for notifications, thus impeding the application of foreign Courts and laws.

The matter is of great interest as once again, the Spanish judiciary clash with EU pragmatic law makers always keen to harmonize diverse legal systems. But then, can Spain be allowed to cherry pick the scope of application of EU laws when it has adhered to them, formally, as opposed to countries –such as Denmark- who have opted out?

And will English Courts (or for that matter, any other Court in the EU) not just consider, but even get to know that a group of Spanish Magistrates have ever expressed an opinion different from the official position? No chance.

About Antonio Flores

Antonio Flores is the head lawyer at Lawbird, a Spanish law firm specialised in property and litigation. More on .

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