Breach of Contract by Developers

Good afternoon, thanks for having me on your forums, this is my first post so here goes!
I wish to describe a scenario which appears to becoming more and more common and get some general thoughts.

In July 2007 I agreed to purchase an off plan apartment in Spain with a completion estimation of mid 2009. In accordance with the contract I made payments equal to 40% of the cost of the property which have been sat in the accounts of the developer earning interest! I anticipated that I would be completing any time around now so was surprised last week to receive an email from the developer to say they hadn't started to build any of the properties on the 'complex' yet and nor did they have any plans to start building. They also said they didn't even know if it would be built!
They have contacted me and offered me alternative properties on different complexes but I do not want an alternative, my confidence in the developer has now gone and therefore I want to retrieve my monies. The contract actually states that the apartments must be built within 18 months of the building work commencing but surely under Consumer Law if they can't even tell me if it is to be built or when it is to be built I must be entitled to the refund of my monies, they surely can't jsu operate on endless timescales?
I only raise this thread as there seems to be conflicting lawyer advice at the moment and I just wanted some general thoughts.
I would suggest under Consumer Law the developer is in breach of the contract and can't simply hold on to peoples money indefinitely?
Any Views gratefully received!

Dave

Dear Dave,

You are welcome to our forum. Feel free to post your legal queries.

Do you have a bank guarantee securing your stage payments for the 40% already paid?

My article below explains what they are in detail:

Bank Guarantees: All That You Ever Wanted to Know but Were Afraid to Ask - 12th of November 2008

If you had them you could actually execute them to retrieve your deposits as the property hasn't even been startred after 2 years time.

If you do not have bank guarantees then your options are either to swap to another development which is key- ready and has a Licence of First Occupation or else withdraw from your contract and litigate for a full refund of your deposits.

The 18 months are counted as from the time the Building Licence was granted. In truth such clauses are not legal as they leave to one of the parties their fulfillment. Under Consumer Law a deadline for delivery of the proeprty must be specified such as "the property will be delivered on March 2010" or else "in the first quarter of 2010".

I suggest you contact us on your matter so that we may examine your Private Purchase Contract (PPC) in more detail free of compromise. We will lay out clearly your legal options and you decide which option is best for you.

Yours faithfully,
Raymundo LarraÃ*n Nesbitt

Raymundo,

Many thanks for taking the time to reply. In answer to your question, I have a Bank Guarantee for the first two payments totalling 26,500.00 euros but have never been issued one for the last payment which is a further 15,500.00 euros. My contract does also state that...
'The seller shall deliver bank guarantees to the Buyer securing the return of installments paid by the buyer to the seller prior to the execution of the sale and deed.'

Unfortunately I have lost all confidence in the developer who in this case is a very large and well known multi national company and do not wish to transfer to another property. I have begun makin representations to them as I feel I have a very strong case, if litigation is the only way then so be it! I believe that I am entitled to a ful refund plus interest as under the Civil code it is covered under 'Loss of the Proper Thing / Contract Object. One thing is for certain, they've had my money for two years already and not even started building, I will not let others fall into the same trap if I can help it. If that means standing outside of the Sales Office for days on end and involving UK or Spanish press then so be it.
Many Thanks again for your help, I may end up calling you as you have mentioned in your reply.

Regards
Dave

Dear Sir,

Please contact us on your matter, thank you.

Yours faithfully,